Last week's action of Forex market was largely overshadowed by looming G20 meeting in London in a few days. Most of the week prices remained largely in a range, until Friday, when USD rebounded strongly. Nothing unusual about it, considering sharp sell off of dollar in preceding weeks.
Other developments of note included continued strength on NZD. It appears that money is slowly flowing towards interest paying currencies, carry trade of sorts. Norges Bank cut rates for NOK, which resulted in immediate sell off for the Krone. Let's remind that over last year currencies tended to be rewarded, not punished, when their respective central banks lowered the rates. News from UK about unexpected jump in inflation will put pressure on currencies around the world, bringing similar fears everywhere else. Most telling, perhaps, are results of U.K. Treasury bond auction on Wednesday morning. It came short of target, failing to sell all of the 40 year Gilts. This indicates that governments might have to start paying more for their offerings, considering just how much money will have to be borrowed over coming years. Matter of currencies will also be present during London summit, when China is going to push for International Monetary Fund's Special Drawing Right (SDR), a currency basket comprising dollars, euros, sterling and yen, to become a super-sovereign reserve currency. Replacement of the dollar in this role.
We updated our detailed results pages, including performance graphs. You can reach them by following the link below. Also, see how our systems did last week. They continue good run in 2009.
(Sunday 03.29.2009).
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Here are the results for last week:
- Daily Pound made 38 pips ;
- Daily Euro gained 308 pips;
Follow the link on the right to view details.
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Last week's results.
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We have been following EUR-GBP for couple of weeks now. As described in last update, first trade resulted in a loss. We placed another order to sell this pair at 0.9350. It was taken out early in a week and reached our target of 0.9250 very fast, for a nice gain of 100 pips.
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Trade of the week from last update was a buy in USD-JPY. Move came soon after weekend, filling our order at 96.75. Price continued to move strongly and reached target of 98.15 very fast. Excellent trade with 140 pips gain. Hopefully we can spot more situations like this.
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For a few weeks now New Zealand dollar has demonstrated considerable strength. By some accounts it is the return of the carry trade. Other people claim that inflationary pressures are starting to show up and this is reflected in strength of currencies like NZD. As for us, we see it as an overdue rally after extreme sell off since last summer. At this point the move is probably overextended and we will look for a short trade, correctional move.
We placed a sell order 0.5656. If price breaks through this level, our target is 0.5570.
We want to wish everybody great trading week!
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Once again we must stress that the trades highlighted here are only a small sample of our trades. If you have any comments or would like to obtain more information please contact us at info@spectrumforex.com .
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Risk disclaimer:
Substantial risk is involved. Forex trading has large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the Forex markets. Don't trade with money you can't afford to lose. Nothing in our website shall be deemed a solicitation or an offer to Buy/Sell futures and/or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on our site. Also, the past performance of any trading methodology is not necessarily indicative of futures results. Trading involves high risks and you can lose a lot of money.
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