Wednesday, February 26, 2014

Price Action Snap-shot:

Mid-week Insight: The overall market data recently released has been mix to disappointing for the USD as the index has already been priced-in with its recent decline to 80.05 basis point psychological support price that has held with short-covering rally that we are currently seeing in the USD movement.

This has been what we were referring to as a possible follow-through short-covering contrary to the variable trend touching 80.05/10 levels mentioned from our previous market view analysis dated back to Feb 09 - targeting the 80.05/10 as a critical key support level. How close can we get to this target has come true to form.

PRICE ACTION SNAP-SHOT

Tuesday, February 25, 2014

Insight: Capital Flight From USD

Following a record high on Wall Street, the Chinese Reminbi or better known as the 'Chinese Yuan' have plunged to its biggest drop in over three years which was mainly due to its contracting economy and talks of credit-tightening that have pressured china's stock market at the same time.

The market conditions would be ripe to also trigger real estate prices to move initially lower for now while the market tries to steady investors behavior moving forward this week's market activities. Meanwhile, the positive mood among US and European stock investors has somehow helped spill-over interest in Asia with Japan's Nikkei moving by a 1.4% and going beyond the 15,000 key price level, which in turn has provided the US Dollar / Yen to move better to the 102.56 USDJPY to this writing.

Capital Flight From USD

Monday, February 24, 2014

How significant is an 'Interest Rate & Currency Swap' for a forex investor?

More important aspect for an investor or a company that is dealing in financial instruments is the significance of the interest and currency swaps affecting cash flow and assest management in the overall portfolio. This maybe considered to be in an institutional level but can be applied to main-street investors. A better understanding can only assist other investor-traders the relevance of including 'Swaps into the equation' whenever dealing with foreign currency trading.

More often swaps may have been over-looked at times or even neglected, since most FX trades nowadays specially from retail or main-street investors have only been taking speculative trades. Instead of enhancing investment funds with dynamic strategies that effectively improve cash flow and asset protection in the portfolio. Trader-investors loose their grip and are not properly guided that these applications do exist.

Interest Rate & Currency Swaps

Thursday, February 20, 2014

Insight to market expectations: USD EUR GBP

The highlight of Facebook acquiring WhatsApp for 19B has been considered the biggest acquisition ever by the media giant that would place FB in the forefront in messaging directly to its clients. A mild corrective move today can be seen but the overall outlook would still be positive.

As the rest of the pack like Twitter, Google, and Apple has followed through on the higher side of the trading price as of this writing. Having walked through this game changing acquisition strategy was indeed a welcome treat in shifting and diversifying investment funds into stocks half way through 2013 other than the FX market. Obviously this was well planned by FB and has provided a shift of market sentiments for stock valuation to continue its upward momentum. And in spite of the relief recovery that the US Dollar has made coming out from its lower levels of 79.90 basis point for the index while making a considerable daily high @80.23 initially in the early trading session.

Insight to market expectations: USD EUR GBP

How Capitalizing on the 'Challenge' of Currency (FX) Trading can be useful for a new trader

Even In the recent 5 years, trading the Currency Market has evolved so much that the building blocks of technical analysis have often been over-shadowed by more fundamentally driven market price action and by weighing investors / sentiment & behavioral characteristics of the market.

Market orientation in particular has been focused on trading the currency market on the merits of technical trading platforms that had its fair share of improved trading mechanism in place over the past couple of decades alone. However it may seem, these technical based analysis derived from the tools of the trade have contributed much to how new traders have learned the mechanics of trading the foreign exchange market.

Capitalizing on the Challenge of Currency Trading

Monday, February 17, 2014

What is a 'Variable Ratio-Risk Analysis vs. Event Driven Risk Analysis for an investor?

First we do need to define what a'Variable Ratio-Risk Analysis (VRRA) mean to an investor. The VRRA as we termed it is the study of price changes similar to Price Action analysis, but goes deeper to the understanding of the statistical relationship among variables that make up the building blocks of the investors asset exposure.

The investor's portfolio either in Foreign exchange or related financial instruments that has in some form or another is influenced by global market conditions.in  prices. This also includes certain currency hedges that can be structured to control the total amount in currency holdings, stocks, treasuries, interest rates and other forms of instruments affecting the price fluctuation..

Please take note that there at least 5 Event Driven Risks for this week's trading activity.

VRA vs. EDR Analysis

Variable Ratio Analysis: Cable & UK Gilts vs. US Treasuries

Fundamental breakdown
Changes in Foreign Exchange rates can influence market sentiment and affects US Treasury risk as compared with the UK Gilts in this case; which has seen wider spreads in this current market conditions.

In understanding the risk characteristics of an investor in the GBPUSD currency related market, we need to know the risk factors in relation to the variation in the economic conditions of the financial markets.  Identified here is the variable difference where the European sector has been adapting a favorable stance versus the recent decline in the US Dollar market. Thus the US treasury is at risk from a declining US value contrary to its European counter part.

Cable & UK Gilts vs. US Treasuries

Wednesday, February 12, 2014

Insight: Market Update ll - EURGBP AUDJPY CROSSES

This market update is a follow-through analysis as a result of our February 5th - 9th outlook where the focus was with the AUDUSD, EURGBP and the AUDJPY cross rates respectively. The movement today confirms our market call.

EURGBP CROSS RATE
The EURGBP cross rate has indeed top-out at the 0.8350 high and we would like to reiterate that the price action and analysis based on our previous market view dated the 5th of February clearly stated that the limited gains would be made while the price levels corrective move to its high is still part of a bearish trend for the EURGBP.

Click to continue

Tuesday, February 11, 2014

Combining Old School with New Technology has its Advantages

With SAC ousted from the hedge fund line,  George Soros’s Quantum Endowment Fund made the strongest gains out of any other hedge fund in 2013. This is according to a tally sheet made by LCH Investments while, John Paulson’s - Paulson & Co. hedge fund came in at 4th place. And Moore Capital, Louis Moore Bacon, $2.5 billion came in at the tenth place finisher for the year.

Those who invested in equities coming out ahead — 70% of total gains in 2013 were made from stocks. This is the same transition period that has cleared our way into shifting most of our trades in mid-June and July towards equity stocks. Particularly in social media, Technology and financial in line with stock valuations  as against reported earnings; as compared to US Dollar value with a hedge position in the precious metals market.

We at Megatrade101 had taken this macro-economics outlook from Keith Anderson, who runs the $25.5-billion Quantum Endowment Fund for George Soros Fund Management, has seen enough of choppy global markets specially the Foreign Exchange market.

Monday, February 10, 2014

Weighing Jobs Data vs. Price Impact

This video highlights the price impact seen in the market from the mix data of a disappointing jobs figure of a mere 113k that drove the USD Index decline to as low as 80.60.  Where we can find the key support price nearest to the 80.05/10 basis point of price reference as a critical area.

And whenever persistent negative bias remains with investors trend sentiment further declining interest for the USD would prevail. However, the drop in unemployment figure at 6.6% thereafter resulted into a mix signal that provided the closing pullback for the USD.  The decline in the USD likewise lifted Stocks and the SP that provided a better valuation for a declining USD value which out-weigh any further decline in stock prices and supporting the precious metals @1267.15 along side crude oil recovering back to its December price levels @100.10 ; respectively.

Thursday, February 6, 2014

Insight: Market Update on AUD EURGBP AUDJPY

Most US Dollar technical analyst would view the markets ability and strength to be wavering between how the USD Index have performed its price movements in recent days until Friday's NFP and the upcoming ECB rate decision.

The relative correction phase for stocks after coming from its highs have clearly showed how bullish sentiments have already simmered down investors sentiment index to negative territory, while the S&P again have become the benchmark for market sentiment trends. Therefore, technical indicators may well lag behind when market prices move before and after such event. The level of trading based simply on technical chart parameters may well be insufficient for the past fundamentally motivated markets. As prices have been well within its daily corrective price range after the recent decline on the Euro and Pound. While the Canadian Dollar has stayed well within its higher band while waiting for some fresh incentives from the market.

Insight Market Update


Sunday, February 2, 2014

Tug of Bar Cluster

The start of the year was positively influenced by the European dominated market sentiment while these shifted more towards a US Dollar dominated flow with FED Tapering having to end the month for a sustainable rally.

With the US Dollar index registering a full length recovery near its level of objective towards the 81.50 basis point.Correspondingly, the decline for the European majors have continued its secondary correction phase with wider swing declines as reflected with the Euro and Cable prices reaching a 1.3484 and 1.6415 low respectively. We did mention last Jan 07 on Cable, that this is part of their cyclical start of the year decline as a struggle between proper market positioning amongst commercials and institutional have been in the making. With barely a small portion of which would be accredited to speculators with variying degree of exisiting contracts.Click to continue.

Saturday, February 1, 2014

MegaTrade One-on-One Mentor Training Program



MegaTrade One-on-One Pro Mentor on Demand is an inter-personal, multi-level approach either direct-online and/or on-site workshop in real time designed specifically to guide qualified investor/traders their own unique trading methodology of trading the foreign exchange market. The workshop and mentors' program is specifically designed for clients / traders individual trading objectives based on specific levels of assessment.

The primary focus of the each designed program is to define the strengths & enhance the traders' knowledge and timing skills on the ‘Mechanics of High Probability Trades’ with certain levels of Trading Confidence. That delivers trade consistency and skilfully timing the market more often than not!  

"It’s not how good MegaTrade101 mentors are, but it is how good a dedicated trader can be when trading the Foreign Currency Market, which should be reflected in each trading accounts’ bottom line! 

Click to view the One-on-One Slide Summary on YouTube