Buying the Dollar on Tax Reform NewsRefer to my EURUSD trading plan for my rationale to be bullish the Dollar.
Brunei
Shorting AUD against the USDThe rationale for this trade is to take advantage of the vanishing Australian Yield spread, the slowing growth, the expectancy of holding the interest rates by the RBA tomorrow.. thats my bearish rational for the Australian Dollar. My bullish rationale for the USD is ofcourse the tax reform news.
Risk for this trade to be nullified (for the dollar) is as mentioned here in my EURUSD trading plan :
Pricing in Brexit (Divorce Deal) Progress via GBPUSDI am looking at Market pricing in the Brexit talk at 1.3500. Rationale for bearish USD (I am actually neutral USD today) is market waiting for a development on Tax Reform debate.
GBPJPY Trading PlansRationale to trading plan (Long GBPJPY one) :
1. There was a news release that claim UK and EU have struck a Brexit Divorce deal which will be confirmed next Monday. UK officials denied this however but further reports after that "reconfirm" about the divorce deal
2. Equities Market have been up, signal potential Risk-On (hence Yen will be less demanded)
*The Short GBPJPY Plan is a technical rationale. The idea is price is going back to Demand level around 147.00 (which potentially a good price to buy Sterling against Yen)
Risk to the trading plan :
1. News that confirms that there was no brexit deal have been secured, which will shift market's mood from positive into uncertain
2. Escalated North Korea missile test issue which will potentially shift market's mood from greedy into fearful (Safe Haven - Yen Demand)
Long USDJPY Trading PlanRationale for the plan :
1. 'Hawkish' statement from Powell
2. Equity markets as of now is positive. Potential Risk-On mode today.
3. Technical Sentiment is bullish USDJPY as price making higher-highs /lower lows since testing 110.900 handle
R isks for the plan (that could invalidate the plan) :
1. Poor U.S Prelim GDP numbers later (Forecast 3.3%, Previous 3.0%).
2. Escalation of North Korea Missile test issues, which would potentially shift the market into risk-averse (Safe Haven flow - Yen will strengthened)
3. Any negative language came out from tax reform news
Short EURUSD Trading PlanRationale to short EURUSD :
1. Market pricing in the positive progression on German politics (coalition), lack of fresh news coming out of it, I am neutral on Euros right now (but keep my eyes peeled for the German CPI)
2. The "hawkish" statements by Powell, it should make the dollar supported for the day at least.
3. Technically, EURUSD making a lower-low price structure, so technical sentiment for me aligns with the fundamental sentiment today.
RISKS for this plan (which could invalidate the plan)
1. Germany Prelim CPI numbers is stronger than expected (Forecast : 0.3%, previous 0.0%). Even if the number 0.1% (more than previous), it could move the Euros upwards.
2. Any negative language came out from tax reform news
3. OPEC meeting today. USD can be pressured if oil price rallying (ripple effect from USDCAD)
4. and sooo many things we could never foresee...
USDJPY Trading PlanRationale to be bearish USD :
1. Tax Reform uncertainty
2. 10Yr Yield still weighed down
Rationale to be bullish YEN :
1. Least greedy market today , safe haven flow
2. Oil been down, market offload risky assets
Long EURAUD PlanRationale for Bearish AUD :
1- Is there are a reason to be bullish AUD today? (I could be wrong!)
EURUSD trading plans for MondayBy default I am bullish the Euro as economic data shows growth/positive in the past weeks and positive development on the German political issues (Merkel and co). I am somewhat Bearish on the USD with bets that investors still thinking off the inflation worries stated in FOMC meeting, the tax reform uncertainty. Though this is at least for Monday as plenty of U.S related risk events and data coming this week (Prelim GDP, FOMC members speaking)
Brent OIL - The fundamentals..With the fundamentals looking bullish, I am looking at a price rally reaching $70.00 by the end of Q1 2018 or mid Q1 2018
Shorting GBPJPY Trading PlanRationale to be bearish GBP :
1. This is short term trade (at least that is my plan), news feed suggest that market shift their attention to Brexit (UK PM May meeting in Brussels on Friday), so until a confirmation, there is uncertainty and that usually pressures the Sterling. Plus this is a range dip trade
Rationale to be bullish Yen :
1. Currency correlation. USD seems to be weak as well as GBP. It won't make sense to trade GBPUSD at this point. Yen seems to strengthened when both Sterling and Dollar weak
2. Equities market is a bit down now, usually signals least greedy market (risk on)
EURUSD - Trading planI am not exactly bullish on the dollar with issues that US Special Counsel Mueller has issued a Subpoena for Russia-related documents (lead to potential risk-off sentiment / bearish USD). But there is also a fresh bearish driver for the euro (and the market seems react that way.. so far anyway)
Rational for bearish EUR :
Germany coalition talk over the weekend. Failure to agree could lead to new elections. Wolfgang Kubicki, a member of parliament and deputy leader of the liberal Free Democrats (FDP) said the deadline for decision is on Sunday 6pm (before asian open kah tu?).. and he said kalua nada progress.. “talk will be dead” (no signs of agreement will potentially effect bearish EUR) *potential political concerns
Short EURAUD Trading IdeaRationale for Bullish AUD :
1. Hawkish comment by RBA's Lowe yesterday, stating that change of rates in the future will be likely raising rates instead of cutting it
Rationale for Bearish EUR :
1. Germany coalition talk over the weekend. Failure to agree could lead to new elections. Political uncertainty
Shorting EURGBP Trading IdeaRationale to be bearish EUR :
1. I still expect the Germany Coalition political issue going to weigh down the currency today.
Rationale to be bullish GBP :
1. Good news on the Brexit deal
*For more details on my rationale, checkout my trading plan for EURJPY, EURUSD, GBPAUD
Long GBPJPY Trading IdeaRationale for bullish GBP :
1. Market took the latest development on Brexit divorce bill as positive. UK Fin Minister Hammond was confident of a deal will be strucked before EU Summit in December
Rationale for bearish YEN :
1. Potential Risk-On sentiment (Equities market Europe closed with all green yesterday and Asian Equities market now is Up)
2. Not to mention BOE is so deep in QE and happily so...
Long : GBPAUD trading ideaRationale to be Bearish AUD :
1. Dovish undertone of the recent released RBA monetary minutes (you can also check my AUDJPY trading plan, detailed rationale why I am bearish AUD). SO this minute strengthenes my personal conviction AUD is Bearish
Rational to be bullish GBP :
1. Apart from the economic data (bullish for GBP), there some positive news regarding the BRexit negotiation. UK Fin Minister Hammon was very optimistic. The market (the banks particularly) liked it apparently.
Short AUDJPY Trading PlanRationale of Bearish AUD :
1. Last week, the risk-off sentiment did not help Aussie one bit (During risk off mode, AUDJPY always trading heavy : bearish). If the risk-off continues, I am expecting atleast a choppy AUD move on Monday, if not continuously pressured due to the next point – (bearish AUD)
2. RBA meeting 7th November 2017 was deemed as Dovish by the market, AUD have been pressured ever since. Ada second release on the meeting minute, usually doesn’t tell us anything new (bearish AUD)
3. No Chinese economic data as well this week (what?!)
4. Lack of significant economic data and fundamental drivers this upcoming week (potentially bearish AUD)
5. Gold have rallied this December but somehow last two weeks correlation a bit off (Gold up = AUDUSD up). My best guess of this "mis"-correlation of the Gold rally is a safe haven move) instead of anything else. (-)
6. Wages number is less than positive (bearish AUD)
7. Yield apparently down for Aussie 10-yr bond (bearish AUD)
Rationale of Bullish Yen :
1. Risk Off Sentiment Safe haven play, SUPER loose monetary policy
NZD JPY - Trading IdeaRationale to be bearish the NZD :
1. The ANZ-Roy Morgan consumer confidence index eased to 123.7 from 126.3 in the previous month. A reading above 100 shows optimism, while a level below that indicates pessimism. (bearish NZD)
2. The Bank of New Zealand-PMI (PMI) fell 0.4 points from the previous month to 57.2 (bearish NZD)
3. Concerns over the policies dari govt New Zealand bary yg banyak kan buat reform to RBNZ (bearish NZD)
Rationale to be bullish YEN
1. Risk Off, Safe Haven
Shorting GBPJPY - Trading IdeaRationale to be bearish GBP :
1. Ongoing uncertainty on UK and EU over the brexit divorce bill – (bearish GBP)**major concern for the market
Rationale to be bullish YEN :
1. Risk off sentiment, safe haven
Shorting EURJPY - Trading IdeaRationale for EUR bearish :
1. Germany coalition talk over the weekend. Failure to agree could lead to new elections. Wolfgang Kubicki, a member of parliament and deputy leader of the liberal Free Democrats (FDP) said the deadline for decision is on Sunday 6pm (before asian open kah tu?).. and he said kalua nada progress.. “talk will be dead” (no signs of agreement will potentially effect bearish EUR) *potential political concerns
Rationale for JPY bullish :
1. Risk off sentiment. Safe Haven
