Market Curiosity: Exploring Markets And Systems

February 11, 2009

Short march Yen (update 1)

Filed under: Futures Trades — Tags: — Jeff Fitzmyers @ 5:26 am

I wanted to short March yen around point A because:
– For the past 2 weeks or so, price usually ended up closing significantly below the highs. (point c)
– The monthly blue CCI got pretty high is in now declining.
– The weekly magenta CCI is below the blue CCI and declining.
– The COT strongly suggests to me that commercials are bearish.
– The price dip below the yellow 34 EMA suggests that was a 4th wave retracement and the 5th wave up was very weak (as it turns out — I did not know until the last 2 down candles).

But decided to wait because:
+ Price was above the yellow 34 EMA.
+ The up sloping trend line B had not yet been broken.

Looks like a top is in. So it is time to patiently wait for price to to kiss the underside of the yellow 34 EMA, or kiss the underside of the trend line.

UPDATE February 10th: I am not looking to short anymore. I am getting very uncertain about events and wonder if things can get really volatile quickly. And the post How The World Almost Came To An End At 2PM On September 18 is the final straw. If anything, the situation is even more stretched. If the USD goes down a lot will JPY follow or be a safe haven? I don’t want to find out the hard way. If I just treaded the chart I am sure things would be fine. But I am pondering this scenario and so not really clear. If I did trade JPY, which I am not, it would be buying options: Risk is very limited.

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