Inside the Currency Market: AUD/USD

Our EUR/USD target at 1.1195 hit 1.1171. Targets are perfect. Yesterday’s EUR at 1.1119 was 1.1124, the ECB pulled another slick one on the market But they also gave traders the hesitation we saw. Why 95% failure at currency trading if that number is believable is due to severe lack of understanding. It is severe in its lack of understanding. Plus understanding requires lightening speed because the 5% running prices are expert with true 100% knowledge. 95% can’t compete against this crowd. Its impossible. Not even hedge funds have the capacity to trade these markets and they have computers. Its evident in their list of winners and losers. What good is a computer if one doesn’t have understanding. They come with these math formulas and claim expertise yet they lack understanding. They fail to understand tying the knot on shoes assist in keeping the shoes on the feet. A chart doesn’t have the answers needed to trade these markets unless, unless one has the proper information in front of them. But if one has the info in front of them, why look at a chart. So the need for a CMT designation only allows a deeper understanding of nothing. My views are respectfully written as my interests are as much academic as much as practical. Greeks call this term Praxis, how to meld theory to practice and employed in Public Administration in the early 1900’s. Understanding of currency markets is actually the same understanding hundreds and thousands of years ago. Nothing ever changed. What changed is the generation that grew up in the modern day with a computer and a few dollars and ready to tackle the world. Money first, understanding secondary. If understanding fails then the vast majority of info out there is wrong, melding markets for a trade is wrong. A company that hires these analysts must assume the analysts have understanding so are trusted with the money and clients to write and trade accurately. That’s a dangerous relationship and it doesn’t work so its why the analysts are allowed to roam and write freely all their wrong trades, false info, broad statements that can’t be verified. Here’s 2 from My Little Boy Weller. A chart of Oil and CAD that says the correlation is breaking down. Another statement that says Australia and Copper correlations are breaking down. No explanation, no numbers, no facts to back the claims. How about Monday afternoon Long NZD at 0.6600. No explanation just long NZD at 0.6600. This trade was in the water all week and as much as 50 pips. Interesting though is the companies that stand behind these analysts types. That’s the danger. The other side of the coin is a guy named John kicklighter at FXCM. This guy is smart, knows his stuff and is consistently smart over many years.

Reading the Fed minutes reveals the same old story I’ve mentioned for eons. The Fed is scared witless to raise. If Inflation goes out of control under their massive balance sheet then they risk a disaster that can’t be repaired, German 1930 Hyperinflation will hit us faster than anyone would know. The difference in their story this time is they have excuses upon excuses why not to raise, China, Greece, the Dollar, exports. Whatever. The Devil killed his grandmother when she ran out of excuses.

AUD/USD/ Bottom. 0.7284. Range break above 0.7346, 0.7395. Below 0.7297, 0.7272, 0.7248. Overbought sell point 0.7344. Strategy shorts below 0.7321, target 0.7303 then bottom at 0.7285. This trade will update around 9 am EST

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