Monthly Thread: May 2004

[rezo_s]

Hello Everyone.

Been away from the forums for some time. Lots of working with creating a company with my US partners, and market was not so good to me (or I was not that good on the markets) lately, so I had a lot of work with the history and my past trades (I think it was worth it).

My focus now falls on USDCHF. It looks good and may easily show lower levels. I also concentrate on Euro and JPY crosses, but I would like to post on USDCHF. I think it MAY be the beginning of the end of the lately seen USD strengthening. Best signs are coming form USDCHF, loosing 400 pips from Friday (its trading 1.2760 at the moment).

We saw sell off of the 1.31570 levels in the end of the April - 61.8% retracement of November 2003 - Jan.2004 move and this may be the beginning of the retest of this year lows around 1.2100.
I will be watching this pair and I think this week, if confirmed, I may sell it on consolidation/small retracement if such occurs. My medium target would be 1.2200. I will post a live call on that one.

 

[Welshmal]

Good to see you back!

 

[rezo_s]

thanks

Good to see you back!

 

[rezo_s]

Follow up on CHF

Good Afternoon.

Ok, we have seen some consolidation on USDCHF after a bounce back from 1.2680-1.2720 support area. This is a strong support,
- first seen as a resistance in January and then as a support in the beginning of March;
- then repeatedly seen as a buying area in the choppy market till middle of March;
- and then seen again as a support on 8th of April;
- and now twice in a raw: on 05. May and yesterday.

Having this kind of support which is repeating itself so many times in couple of months means this level is strongly in mind of market participants. Those who were thinking to buy will try to buy there and those who sold earlier will be taking profits or part of profits in that area thus once again supporting the area.
This area also keeps sellers away from opening new positions when price is there, and that is exactly what is needed in order to break the level and take the price to other range of prices.

But with all that said, every support area/every support line is by its nature meant to be broken sometime. When? is the question. Lets take a look at the multiple times this area occurred, and then keep on the discussion.

 

[rezo_s]

As I said, every level can be broken and in this case, if you ask me, on scale of 1 to 10, chances are at least 6 or 7 that this area will be broken this week. Maybe even today-tomorrow. My indications are that we will at least retest it once again for a break below.
Lets take a look at 240 min chart and see the facts:

- acceleration on the last up swing to 1.3080 high was stronger than of the previous one (the angle)
- but the high on the last swing was lower than the previous one. Previous was 1.3225 on 26th of April.
- bottoms of both swings down was same 1.2690 level (which is the area mentioned on the previous chart).

This makes the picture on charts make look very much like descending triangle which is a bearish formation , but for now its not exactly the same.
Partially my target 1.2200 which I mentioned yesterday is due to the similarity of the current situation with triangle.

My Strategy

I am looking at this pair to sell, and I think it would be good to sell in 1.2870-1.2900 area, but anything above 1.2850 may be also ok. Its hard to predict where will I sell exactly - it may be even below 1.2850 - will see. I am not planning to wait and see the break, because I do not usually trade the breaks. If my indications are good, I usually trade for the break.

This is still not definite if I sell, but I will post a live call once/if I do.

Another 2 pairs are the EURUSD and EURJPY - to buy. I will also try to post if I enter any of those, but I do not promise. However, I do promise to post on the Swissy.

Good Trading Everyone.

Rezo Shmertz

 

[Welshmal]

Great stuff! With the market at 12830/12770 what would you suggest?

Thanks - you posted the answer as I was sending this!

 

[rezo_s]

Hi Mal,

I mentioned what my strategy is. I guess you posted before the last post of mine

 

[rezo_s]

Sorry all for how the last chart looks like , but I just wanted to show everything I write in post on charts, so it will be easier to see what I am talking about.

Ok, couple words on EURJPY:

its currently trading at 136.40 after being as high as 137.90 in early Asian session and as low as 135.80 in mid European session.
I think there is more consolidation/correction to be seen here before/if the price can move further (higher). I am considering to buy this pair for a retest of this year 139 high and maybe the last year >140 high.
I believe there is a chance for further consolidation due to the recent rally, and maybe it will get to 135.50 area and maybe even 135.00, where it may become very attractive for buying. Will see.
I don't think I will trade it today. Tomorrow is a new day and we analyze it once again.

Good Luck!

 

[kjb]

Does anyone else use FXCM?

I just got this message from them 'Market orders only during volatile times please' which I take to mean don't place market entry orders around any data releases. Surely they cannot prevent anyone using what is, after all, a legitimate trading opportunity?

Kev.

 

[rezo_s]

Hi Kev,

I think its some king of a mistake. I dont usually trade by orders nor do I trade the news, but I use refco which is basiclly the same as FXCM and I got no such message. I recommend you to call them or use the online chat and ask them about it. I agree that this is not reasonable and I think its some kind of mistake.
If you do chat with them, please let us know.

cheers

 

[kjb]

Re: FXCM and that message .......

False alarm on my part

Had a chat with them and it seems some people have had probs with orders not being filled during the overlap when data is released. They cannot guarantee fills during these periods, which seems pretty fair when you look at some of the spikes at such times. They also advised me to use firm stop-losses if I planned to trade data releases, very considerate I thought!

Kev.

 

[rezo_s]

I am sorry for using this kind of language, but its total BS!

They started out with guaranteeing orders and stop loss fills no matter what plus immediate fills: "what you click is what you get". Now there is no click-get - if price moved, you get a message that price moved despite the fact that you already pressed ok in the price pop up window. Now they start with no guaranteed fills of orders during the releases? last time I spoke with them (Refco/fxcm - same), they said entry orders are guaranteed up to 10 million size and stop losses no matter what size.
I heard that they said that if you put an entry order at least 5 mins before the release, then its ok. Now its also canceled?
What's next? they will take away the guaranteed stop losses? well, then the only thing that will differ them from the interbank market is the constant spread, which I think is not enough reason to stay with them. On interbank market spread may vary in volatile market, but on regular market you have 1-2 pip spread and you know you work with a bank if you want a confirmation of price/trade.
FXCM/Refco started out very nicely and gave it all as they claimed, but now they are taking it all away little by little... Its a shame if this is the case...

 

[rezo_s]

We are seeing some more correction coming on USDCHF as expected, and this may push the price to the area I was talking about - above 1.2850 (we are almost there; as I am typing, we have reached the high of 1.2845). EURJPY is going slightly up and is at 136.60 right now, but I belive we can still expect the correction later. Lets see how CHF handles the levels above 1.2850 and to 1.29...

 

[darktone]

hello rezo / kjb

Does anyone have the text of this report? i havent had an email from them and i wasn online for chat message.

I shadow your thoughts rezo, i hope this is not the case as a new customer, good execution was the prime reason for me to move accounts. I might add that it certainly wasnt the case when i went to Lombard street and spoke in person a/the CEO

 

[rezo_s]

Hi DT,

well, I too certainly hope its not the case, but now seeing them singing a different song with the orders and executions...I start to wonder...

I agree. executions with Refco/FXCM are the best I have ever seen, but with this kind of tendency, when I practically get requoted...its not looking so good.

I had a talk with the chief dealer in Refco in Us, and when I was mistakenly claiming that I was requoted couple times. He denied. He was right, I didn't get requoted. what I mean is that my price was rejected and I wasn't offered a new price.

Now lets define what requoting is (which FXCM/Refco claims not to have and that its providing instant executions).
Requoting is when you want to buy/sell, you press the appropriate button, choose the volume -> everything is set, and when you press the "ok" button, instead of execution of the trade on the price you see, you receive a message that price has changed and you are offered a new price... Everything the same started happening on Refco/FXCM platform couple months ago except for the last part - you don't get an offer of a new price; you just get a message that price has changed. So what choice does it leave you? right, enter by the new price. Basically the same thing.
The dealer was arguing with me that there was no requoting, and finally I understood that he meant I didn't get a new price offer...well, it doesnt make a difference for a trader, does it...?

now I hear that they don't guarantee fills during the news releases...

so I wonder...what's next? no guaranteed stops? I am worried. Of course I am worried. I work with them, most of my clients hold accounts in RefcoFX... if after all they will be working on real interbank conditions, then I really will prefer real interbank and not the retail solution...

That's why I say they started things very nicely, but now...little by little they start becoming like any other? no good if you ask me...

 

[darktone]

We dont requote!

we just dont quote!

u goto be kiddin me!

 

[rezo_s]

no, I swear. That was the conversation over the phone. about 20 mins he was prooving me that they do not requote untill I finally understood that he meant I didnt get an offerof a new price... I dont think it makes a big difference... after the trade is set up and I press the final "ok", I should get filled by the price I saw in the window, but they can do whatever they want... thats why I am talking about interbank market - out there you know you bought a price, who you bought it from and all the details are there.

Here is another thing: lets say you doubt the price your stop loss or any other order was executed at. You want a confitmation from the broker. Can you get anything except for their quotes data? no. That was another problem I had. I called in and said: my order was executed. It means one of the providers of your quotes; i.e. one of the banks you claim you work with or some other institution had a deal on that price, right? I mean if you give a quote and claim that was your price at that moment , it came from some place. They claim its from several banks who provide the data. So, if bank provides you with a quote, it menas that very bank had the last ticket executed on that very price...And so, if you try hard enough, you can request a confirmation of that very trade at that very moment at that very price...right? wrong.
We, as their clients agree not to dissagree on any price we are offered. They are the market makers, and therefore they can quote us at any price... thats the way unrequlated markets work. Sad story.

 

[rezo_s]

But still, I have to say that Refco is the best of the brokers I have worked with till now, and therefore I am ready to give up on those guys only if things will become really ugly. Till now these are the small things that are starting to show new tendency of Refco/FXCM not to give that much to the clients as they were from the start. Obviousl they think: why give that much while other brokers dont give a half of what we do...

Well, will see. At least overall they are much much better then others and the customer support is as good as it gets... once again, lets see how far it goes.

 

[Welshmal]

Well back to the business and the Swiss Franc is looking interesting once again.

 

[Buk]

been away from the screens past couple day's, but rec'd a call along the same lines from another trader this p.m.....hmmmm, as you say Rezo, we'll have to wait & see...........

http://www.ac-markets.com/

I stick majority of my short strat deals thru these guy's anyway, preferring FXCM for the swing trades, but agree, it's a tad worrying if they're going to start playing silly beggers!