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Trades 09/08/07

Posted on 08/09/2007 08:38:13 | Link | Post Comment
Long on a break of cluster resistance + interest rate rise. Not currently the most convincing move in the world, and I'll be watching to see if it falls back into the consolidation area if this resistance-become-support breaks. I'm targeting the 61.8 fib firstly and will see what it does when it gets there. If it gets moving with any speed I'll target 8850. You can almost sense that people are too busy licking their wounds from last week to have much enthusiasm for anything. It seems to be very much a case of emotions over real fundamentals to me - no wonder. Probably a lot of people lost a lot of money last week, and the last thing the masses probably feel like doing after that is going long again.

I've also made a decision to not trade crosses until I feel quite confident trading the majors. Under normal circumstances, you'd have the USD interest rates on hold, AUD interest rates rising, and possible resumption of the the carry trade and in such a case trading the AUD/JPY would make more sense than going long on USD/JPY and AUD/USD - but I consider this to be advanced trading and I currently don't want to get so fancy. Trading crosses means you have to factor in the economic situations of 3 currencies rather than 2 as with the majors, because of the fact that the crosses are mathematically derived from the majors, so even in the case of AUD/JPY the USD is still a bedfellow.

AUD/USD * USD/JPY = AUD/JPY


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