fair post, but I'd like to throw another thing into the ring: The FED and BOJ are at war (so to speak) to devalue their currencies at the moment. When intervention occurs, fundamentals hit the fan.
I know this thread is effectively a charting thread, but I'd like to throw in some fundamentals here.
Why would the USD rise? There is no reason that the value of a USD will increase. The value of a USD is a function of the monetary base and the aggregate credit of that monetary base (which is also a function of the former). The monetary base has not only been exploded by the US central bank, following Keynesian monetary policy (Bernanke believes, and you can read his original paper, that the great depression was caused by the central bank failing to expand the money supply), but is still being expanded - and will continue to be so until at least mid-year. The value of a USD is also a function of the demand for USDs - which a function of the health of the US economy. There is no evidence that the US economic structure is more sound now than it was prior to the crash. Sure, economies do recover (to varying extents) following a crash, as resources re-consolidate back to more efficient uses, but this depends on the extent to which a free market exists - and the US is moving further from a free market, not closer.
If nothing politically changes, the future of the USD is very clear - it will not be worth very much. Maybe even as much as a Won.
Regarding AUD, sure, one could argue that there are risks that the AUD will fall. When China has a blow off, for instance, the AUD will plummet. But until then we are in a commodity boom - and fundamentally this is increasing the value of an AUD.
Hi Frank. Would be interested in any reasoning for your take of some US dollar recovery.
Well the fed did actually intervene recently to sell the yen, which it wouldn't do in a devaluation war with Japan.fair post, but I'd like to throw another thing into the ring: The FED and BOJ are at war (so to speak) to devalue their currencies at the moment. When intervention occurs, fundamentals hit the fan.
From a technical point of view, it is due a correction after such a huge rise.
That was the GFC crash, yes? I can never understand how you techies think you can predict financial crises and earthquakes by looking at a price squiggle.Yeah. And it happened.
That was the GFC crash, yes? I can never understand how you techies think you can predict financial crises and earthquakes by looking at a price squiggle.
Some techies, and I have witnessed this clear as day, have performed analysis on certain price moves, and indicated that their analysis somehow explains these moves. All very well - except that the moves in question were the plunge of certain uranium's stocks. No, the move was not explainable in anyway by tech/a - it was caused by the Fukushima incident.Predicting earthquakes and financial crises'? You're kidding aren't you. Do you have any idea how t/a works? God I don't even know why I'm wasting my time on this post. Back to staring at the charts.
Some techies, and I have witnessed this clear as day, have performed analysis on certain price moves, and indicated that their analysis somehow explains these moves. All very well - except that the moves in question were the plunge of certain uranium's stocks. No, the move was not explainable in anyway by tech/a - it was caused by the Fukushima incident.
If you will read the posts above, tulip says aud/usd is due for a correction after such a large rise. I then point out that could be said half way up the said rise. He then said 'yeah and it happened', and included a chart. The said chart contains a snapshot of the AUD/USD plunging after rising a lot. The implication being that this was evidence that such tech analysis was well founded.
The plunge happened to be during 2008.
I swear most of you techies are inches from playing aeroplane in public.[/QUOTE]
hahaha
I totally agree with your points regarding stocks and forex. People often ask me about stocks and I can say to them with all honesty I know nothing about them. Forex is a totally different beast.
Forgive my ignorance, but what are you referring to when you mention F/A? And for that matter T/A?
Your story about the 'expert' reminds me of this clip explaining efficient markets:
Yes F/A is harder. However, it requires patients more than anything else. A fundamental trader who saw BOE printing and the Fed printing, but the RBA not printing, is a good example (e.g AUD/USD). Yes, FX is completely different to stocks.My theory is Forex Trading using F/A is just so too hard for the majority of ASF forum users (myself included). The market moves too quickly and the lack of interpretation of any fundamental news just requires too much time for the average trader to analyse and make a move before a major investor or broker jumps in on it. Stocks and Forex are completely different - you're kidding yourself if you apply the same strategy towards both.
Depends on position sizing. If one is scalping one will use a large position. If one is trading 'I think usd is going to sink over the next 3 months', one will use a smaller position.The point I'm trying to make is too many people confuse FX with CFD equity trading. It's completely different, the rules for one do NOT apply to the other. FX is fast and in my opinion, too fast to use F/A! Use a chart, find support and resistance - trade well within it using a high contract size, high stop in the direction you expect it to go and low stop within the position you want out!
Oh I hate the efficient market theory. The idea that all market agents are equal and that some cannot process information better than others, apart from being fatalist and flying in the face of evidence, is illogical. 'Bargains' in stocks (or perhaps currencies even) are not as simple to evaluated as 'bargains' in shoes and groceries. A shopping queue has one 'value', one 'input' and one 'output' - hardly a valid model for a stock, which has a huge number of inputs, outputs and values.Your story about the 'expert' reminds me of this clip explaining efficient markets:
Oh I hate the efficient market theory. The idea that all market agents are equal and that some cannot process information better than others, apart from being fatalist and flying in the face of evidence, is illogical. 'Bargains' in stocks (or perhaps currencies even) are not as simple to evaluated as 'bargains' in shoes and groceries. A shopping queue has one 'value', one 'input' and one 'output' - hardly a valid model for a stock, which has a huge number of inputs, outputs and values.
Financial firms always get the information first. You can at best get it just after that.Say if you were to try to digest fundamental FX market information and trade a position based off this, where would be the best source/s of immediate market release information? ('immediate' being the operative word here as publishing fundamentals 2+ minutes too late means the market has potentially already moved)
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