RMB & USD impression

Fundamental for today:
Jan 30, 15:00 GMT United States !! Consumer Confidence 109.00 p 109.50 p
Jan 31, 00:00 GMT Australia ! New Home Sales -5.30 %

I won't expect something specticular like a move of 100 pips... except on the FOMC Minutes and the NFP. The fate of the USD, all depends on the results. :)

Ahh... Forex market is in it's mood swing... What better way to do is to surf the internet, and start reading up, revealing the hidden mystery to my question.... It might be boring, and not worth the time to read...

I came Rob Kirby latest article on question on the possible answer to the big China / USD questions: How can China continue to add to its hoard of US bonds without ending up with giant worthless piles of paper as the dollar depreciates? How can the dollar go into freefall without seriously damaging the foreign (US Dollar) reserves of China? I really love the done up summary on the China USD stuff, which is well done up by Robert Chamber's Blog.

What Robert said in his blog had truth in it. Using bonds as margin to purchase future commodities, passing risk to commodities manufacturing companies, and converting this raw material into value added finished goods. Having a long term vision, reducing currency risk and ultimately having the power to monopolise and control the market.

But, i don't think RMB is going to appreciate fast, as it still needs it's manufacturing product to be exported out. If RMB appreciated too fast, just like the Euro dollar, we will be seeing more China workers being layoff, due to cutting of cost of production.

After reconsidering all this elements, what the Fengshui Master Khoo said might be true, in the metal industries in China will grow. Hmmm..... Interesting indeed.

NFP this Friday

There are not much fundamental to look and analysis this week... Except for the preparation of the NLP. No much movement for today, hoping that tomorrow will be better...

Barclays, Standard Chartered Are Yen Bears on Rates
Yen Falls as Government Report Shows Waning Consumer Spending
Bloomberg Currency Survey Says to Sell Yen, Euro Versus Dollar

Malaysia Scam

Wow, look at this....

Job seekers lose thousands of ringgit in elaborate scam
Lure of quick money behind forex scams

This is how bad in Malaysia... :(

S'pore inflation rate increase

Singapore Dec. Inflation Rate Climbed to 5-Month High Finally, someone wrote about this, regarding GST hike, raise in housing, veggies increase due to flood and reduce in corporate tax to encourage foreign investor. I wonder how i am going to survive without any salary increase. :(

Forex update
BOJ Minutes was announced today, I was expecting some movement, getting ready to do some trading. To my surprise, volatility is very low, ended up not trading during Asian. There were no fundamental for USD, EUR and GBP, yet, after Euro session, volatility picked up. Sometimes, i wonder, does this volatility has to do with political issue regarding US and Iraq; or maybe just a investor's sentiment towards the currency; or because of the slight increase in the commodities "Oil Rises on Heating Demand, Kidnappings by Nigerian Militants" ; or Bush Confronts `Political Reality' in Tonight's State of Union. All the above are a possibility.... :)

Interesting news for today
Germans get by without the euro
Petraeus, U.S. Commander in Iraq, Will Test Doctrine He Wrote
FOREX-Sterling at multi-yr highs on carry buying spree
US STOCKS-Futures point flat; heavy slate of earnings

FED on the move

After last week of Ben Bernanke speech which is hawkish, supported with positive reinforcement from fundamental. I guess everyone is clueless regarding the next step of action. Today's market is a very narrow market with those trader who trade, holds their position overnight.

Ok, this is FED summary conclusion, which of course leaves me with a USD negative impression:
Moskow Sets Retirement, Leaving Fourth Fed Opening
Fed's Hoenig Says Inflation Too High; Interest Rates May Help
Bernanke Warns of Possible `Crisis' From Budget Gap

Market Sentiment

Ok, this is an important index showing the current market positioning in the long term. Good to do some cross referencing once in a while: Sterling Shorts Make 77% of the Open Interest :D

Fundamental news

17/01/06

BOJ maintain it's interest rate after a 6-3 vote. Current rates are .25% for o/n and .40% for the Lombard rate. Based on the 6-3 vote many analysts are expecting the rate change to occur at the February 20-21 meeting. Have to wait for next month to see any changes. If you seriously looking at the USDJPY chart, it is moving towards 2005 high as compared to 2006.

This is a very wonderful special report being written: Bank of Japan to Raise Rates? Currency Traders' Views Diverge. Really love this report. The speculative sentiment index for the whole week was a sell jpy, and I even have rumours that despite the increase in interest rate, it would be a sell jpy and buy jpy. Even though the report stating that majority economists predict this rate hike, hey, economists don't trade, only investor's do. Am i right? ha ha....

Based on the 6-3 vote many analyst are now expecting the rate change to occur at the February 20-21 meeting.

18/01/06

Consumer prices climb in December

December housing starts up 4.5 pct

Jobless claims post surprising drop last week

Martin Luther King day

It's Holiday today in USA. So far, volatility is expected to drop as compared to a normal trading day. Should be boring eh... It's a good day to read up all the reports, and analyse on the next movement and wave in tomorrow's market. That's include remembering as below, once in a while:

DENNIS GARTMAN'S NOT-SO-SIMPLE RULES OF TRADING

1. Never, Ever, Ever, Under Any Circumstance, Add to a Losing Position... not ever, not never! Adding to losing positions is trading's carcinogen; it is trading's driving while intoxicated. It will lead to ruin. Count on it!
2. Trade Like a Wizened Mercenary Soldier: We must fight on the winning side, not on the side we may believe to be correct economically
3. Mental Capital Trumps Real Capital: Capital comes in two types, mental and real, and the former is far more valuable than the latter. Holding losing positions costs measurable real capital, but it costs immeasurable mental capital
4. This Is Not a Business of Buying Low and Selling High; it is, however, a business of buying high and selling higher. Strength tends to beget strength, and weakness, weakness
5. In Bull Markets One Can Only Be Long or Neutral, and in bear markets, one can only be short or neutral. This may seem self-evident; few understand it however, and fewer still embrace it
6. "Markets Can Remain Illogical Far Longer Than You or I Can Remain Solvent." These are Keynes' words, and illogic does often reign, despite what the academics would have us believe
7. Buy Markets That Show the Greatest Strength; Sell Markets That Show the Greatest Weakness: Metaphorically, when bearish we need to throw rocks into the wettest paper sacks, for they break most easily. When bullish we need to sail the strongest winds, for they carry the farthest
8. Think Like a Fundamentalist; Trade Like a Simple Technician: The fundamentals may drive a market and we need to understand them, but if the chart is not bullish, why be bullish? Be bullish when the technicals and fundamentals, as you understand them, run in tandem
9. Trading Runs in Cycles, Some Good, Most Bad: Trade large and aggressively when trading well; trade small and ever smaller when trading poorly. In "good times," even errors turn to profits; in "bad times," the most well-researched trade will go awry. This is the nature of trading; accept it and move on
10. Keep Your Technical Systems Simple: Complicated systems breed confusion; simplicity breeds elegance. The great traders we've known have the simplest methods of trading. There is a correlation here!
11. In Trading/Investing, An Understanding of Mass Psychology Is Often More Important Than an Understanding of Economics: Simply put, "When they are cryin', you should be buyin'! And when they are yellin', you should be sellin'!"
12. Bear Market Corrections Are More Violent and Far Swifter Than Bull Market Corrections: Why they are is still a mystery to us, but they are; we accept it as fact and we move on.
13. There Is Never Just One Cockroach: The lesson of bad news on most stocks is that more shall follow... usually hard upon and always with detrimental effect upon price, until such time as panic prevails and the weakest hands finally exit their positions
14. Be Patient with Winning Trades; Be Enormously Impatient with Losing Trades: The older we get, the more small losses we take each year... and our profits grow accordingly
15. Do More of That Which Is Working and Less of That Which Is Not: This works in life as well as trading. Do the things that have been proven of merit. Add to winning trades; cut back or eliminate losing ones. If there is a "secret" to trading (and of life), this is it
16. All Rules Are Meant To Be Broken.... but only very, very infrequently. Genius comes in knowing how truly infrequently one can do so and still prosper

Interesting Stuff

Wow, China's Foreign Currency Reserves Top $1 Trillion, just imagine, $1 Trillion being pumped. Would be a pretty interesting sight... he he..

Hedging funds is on the move: Canadian Dollar Falls Prey to Hedge Funds as Crude, Copper Drop

I find this article interesting and good as well: 25 Year Stock Market Top

What's Next?

Quoted from Euro (EUR) Traders Insecure Ahead of ECB Rate Decision
The long awaited European Central Bank interest rate decision is tomorrow morning and the Euro is weak going into it, which means that should there be any upside surprises, the EUR/USD has plenty of room to rise. The main question the market is contemplating at the moment is not how much the ECB will move but whether ECB President Trichet will stick to his hawkish stance since no rate changes are expected. Recent economic data suggests that even though growth in the Eurozone economy is improving, the improvements have been limited to certain sectors. The drop in oil prices has also been helping to lower inflationary pressures but at the same time, recent Euro weakness is keeping it from falling too far. Trichet surprised the market in December by remaining extremely vigilant and to date, we have not heard any differently from other ECB officials. The ECB is not a central bank that likes surprises which means that if they were to change their stance, they would have most likely let the market know by now. Therefore it is quite clear why the market is so insecure going into this rate decision. Insecurity only means one thing in the currency market and that is, volatility. Meanwhile the Eurozone data released this morning was softer than expected. Both French industrial production and the French trade balance deteriorated in the month of November while the German wholesale price index remained flat in December.

BOE MPC hikes repo rate 25 basis points to 5.25%. Strong bulls in on the move here. No surprise for me as it was announcement last year. Everything is pretty in prospective. As expected ECB leave rate the same as it it.

HAPPY NEW YEAR 2007

YeS, it's here again... A whole new year, with new resolution and new plans and target....

With internet is not fully operational with some slow internet speed, will check back on this Friday, that's the Non-Farm Payroll January 2007... YAHOO....................