Getting my mojo working again

Just returned from a brief vacation and getting back into the markets -- I'm getting my mojo working again, so to speak. Not much has changed since my last post a week ago, so this quick review of my EURUSD position must suffice for the time being. Still feeling comfortable with this trade. The pair hit the 50% Fibonacci retracement around 1.08 in early February and has been in a solid downtrend since then. Next stops -- ideally -- 1.0454 and 1.0341.

EURUSD Daily 22/02/2017Open positions as of 22/02/2017 8:39am CET:
EURUSD short from 1.0795, unrealized return: +2.78%

Realized YTD return: +4.34% from 3 trades
Total YTD return: +7.12% from 4 trades

Fed on track to hike: USD long

Expectedly, Yellen didn't provide anything enlightening yesterday. The market realized the Fed is still on track to hike rates this year, with March being a "live" meeting (although the hike probability is not high by any means for that meeting). Perhaps traders are still remembering 2016 when the Fed didn't hike as often as had been expected. Traders should forget all about 2016! The Fed entered its rate hike cycle, and it will hike again. Traders should also pay less attention to Trump statements. Let's wait for actual implementations of his promises instead. Regarding his USD rhetoric, it's meaningless. If his administration will deliver on his stimulus promises, which I think it will, that will be inflationary and ultimately positive for the US economy, i.e. it will give Yellen & Co. even more reason to continue hiking rates. It will also be important for the Fed to prove it is an independent institution; the US president has no business pressuring his nation's central bank. Everything is playing into the USD long story at the moment. Don't let Trump noise fool you into thinking anything else.

EURUSD Short 15/02/2017

Quick look at NZDJPY: After I chickened out of putting on a NZDJPY long trade post-RBNZ, the pair is looking constructive again. Trendline support still valid. On hold but definitely interesting.

NZDJPY Daily 15/02/2017Open positions as of 15/02/2017 10:19am CET:
EURUSD short from 1.0795, unrealized return: +2.37%

Realized YTD return: +4.34% from 3 trades
Total YTD return: +6.71% from 4 trades

Expect nothing new from Yellen today

Fed chair Janet Yellen will deliver her semi-annual congressional testimony before the Senate Banking Panel today. I expect nothing new from her today. It's too soon since the latest Fed meeting on 1 February to change course, and the dollar is too strong to hint at a March rate hike, in my opinion. I maintain my EURUSD short position. By the way, US National Security Adviser Michael Flynn's resignation is a non-event for FX, ignore it.

DXY Index 14/02/2017Open positions as of 14/02/2017 08:45am CET:
EURUSD short from 1.0795, unrealized return: +1.77%

Realized YTD return: +4.34% from 3 trades
Total YTD return: +6.11% from 4 trades

Closing my EURTRY short trade

Since EURTRY failed to break through the 50% Fibonacci retracement at 3.9083 on Friday and RSI is back in neutral territory, I closed my EURTRY short trade at 3.9354 this morning. Having opened the position at 4.0524 on 23 January, this translates into a quick 3.64% spot+carry return. I still like the pair for shorts, but considering the sharp TRY recovery since January I'd rather watch from the sidelines until a new selling opportunity presents itself.

EURTRY Daily 13/02/2017Open positions as of 13/02/2017 08:44am CET:
EURUSD short from 1.0795, unrealized return: +1.51%

Realized YTD return: +4.34% from 3 trades
Total YTD return: +5.85% from 4 trades

Peter Green: A Fool No More

It's Sunday, and Sunday is blues day! This week with the slow blues A Fool No More by Peter Green. It is off his 1979 album In The Skies. Having founded Fleetwood Mac in London in the late 1960s, Green used to be a preeminent blues rock guitarist during the British blues movement. Even audiences not listening to the blues will probably recognise some of his songs, such as Black Magic Woman, which was later covered by Santana. Peter Green began taking larger doses of LSD around 1970, leading to him leaving Fleetwood Mac. Succumbing to mental illness, Green underwent treatment for schizophrenia in psychiatric hospitals in the mid-1970s. Although he reappeared on the music scene sporadically towards the end of that decade, he has mostly remained in obscurity from 1980 onward.