AUD/EUR V EUR/AUD: Levels, Ranges, Targets

 

What drove EUR/AUD higher was a serious overbought AUD/EUR. The Pair EUR/AUD saw lows at 1.4137 which translates to overbought AUD/EUR at 0.7073. AUD/EUR had to fall therefore EUR/AUD had to rise. While AUD/EUR was overbought to extremes, EUR/AUD was severely oversold. EUR/AUD Friday saw highs at 1.4484 and translates to AUD/EUR at 0.6904.

EUR/AUD closed at 1.4445 while AUD/EUR closed at 0.6915. EUR/AUD close at 1.4445 translates to AUD/EUR 0.6922 so 10 pips are missing. At the open, EUR/AUD comes down 10 pips or AUD/EUR rises by 10 pips. Each side must meet its equilibrium to begin its next journey.

AUD/EUR from 0.6915 has solid bottom at 0.6880 or EUR/AUD top at 1.4534. EUR/AUD bottom is located at 1.4372 or AUD/EUR 0.6957. The bottom of the AUD/EUR channel is 0.6934 or EUR/AUD 1.4421.

AUD/EUR big break points are located at 0.6862 and 0.6826 and factors to EUR/AUD 1.4573 and 1.4649. Big break point for AUD/EUR above is located at 0.6742 or EUR/AUD 1.4832.

EUR/AUD big break points are located at 1.4576 and 1.4650 from current 1.4445. EUR/AUD 1.4576 and 1.4650 translates to AUD/EUR 0.6860 and 0.6825. EUR/AUD from close at 1.4445 is approaching significant breaks above while AUD/EUR faces significant supports below.

Most vital bottom for EUR/AUD overall is located at 1.4073 or AUD/EUR at 0.7105. AUD/EUR becomes severely overbought at 0.7105 and EUR/AUD severely oversold.

AUD/EUR is allowed 35 daily pips while EUR/AUD is allowed currently 73. AUD/EUR 2 times its range equates to 70 pips so EUR/AUD is off by 3 pips. Both pair’s daily allowable pip movements are extraordinarily low. Currency pairs overall are moving closer and closer to each other’s prices.

Total EUR/AUD movements are 70 pips but encompasses 35 for AUD/EUR and 35 for EUR/AUD.

Took 4 days from EUR/AUD 1.4137 to 1.4445 so 70 X 4 days equals 280 but EUR/AUD closed at 1.4445 or 308 pips. Why slight miss is due to EUR/AUD as 35 maybe current allowable but some days its slightly higher or slightly lower. Why 4 days is because starting day prices for currency pairs and daily candles are never accurate and always off. Never do daily prices and  daily candles  meet properly to render a full accurate trade assessment therefore all candles are off by X amount of pips. And this includes all currency pairs. AUD begins at 1:30 am EST time while EUR begins at 5:00 am EST therefore a 4 hour interval difference exists.

 

Brian Twomey, Inside the Currency Market, btwomey.com

 

 

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AUD/USD CPI and AUD Pairs

Australia CPI last 0.4 Quarter V Quarter and 1.7 year over year is expected. The point at 0.4 is perfect while 1.7 is viewed as coming down a notch.

For  Core at 0.4 is derived from the range between a low of 0.36 to highs at 0.47. The average of target prices is found at 0.41 and 0.40 to factor the Core prices. Both look perfect.  If Core is found from  0.36 to 0.47 then headline year over year factors to a range from 1.44 to 1.86 with an average at 1.60 to 1.64.  Overall, I see 0.4 and 1.60’s as the final release.

Why averages are considered as final results is because Australia Trims their means in relation to their CPI release, its traditional Australia and a unique methodology because the Trim Means factor between Trade Ables and Non Trade Ables. Reason why Australia allows for a medium term Inflation target of 2 to 3% is because Inflation hovers from 2 to 3% inside its Trade Ables V Non Trade Ables.

Current quarterly changes in Trimmed means from September 2015 to June 2016 runs from lows at 0.2 to 0.6 highs. Core at 0.4 is again found direct center. What drives Australia Inflation and why lower rates is due to low and lower wages, falling commodity prices ( 20% drop in Australia over 2 years), and what Lowe stated in his first speech, excess economic capacity. What Lowe refers for Australia year over year to June 2016 is the Output Gap based on the latest OECD number is running at negative 1.76%. Supply of Goods outweighs the demand and is traditional deflationary. Low Inflation is the result of economic slack brought on based on Lowe, Debt overhang from the 2008 crisis. Confirmation of self inflected wounds from stimulus yet Australia historically is never the cause but traditionally rides through the changes since its founding in the early 1900’s.

Why Inflation is a pertinent and  enormous number for Australia is because CPI in relation to Trade Ables and Non Trade Ables explains the vast majority of the current Australia economic environment. Again to quote Lowe, “Australian exports are down 35% over the past 5 years because Australia Commodity prices dropped 50%.”. Inside the Trade Ables V Non Trade Able relationship is found this export deviation and again its an explanatory factor to current CPI as lower exports is a drag on CPI, GDP and the overall Demand /Supply relationship.

AUD/USD big break lines below current 0.7647 are located at 0.7596 and 0.7594. Both lines held for many months. Until both lines break, AUD rises. Overbought for today begins at 0.7665 while the major break to go substantially higher is 0.7801. AUD/USD overall is middle range but caught between the variations of its cross pairs.

AUD/CHF remains overbought from lines at 0.7400. Current 0.7602 begins overbought from 0.7621 and more overbought as price rises.

AUD/EUR is another far overbought currency pair and its price should be located at easily far lower 0.6900’s. Why overbought for extended periods is because EUR/AUD is far oversold.

AUD/CAD should be located between 1.0061 to 1.0102 to relieve overbought conditions.

 

Brian Twomey, Inside the Currency Market, btwomey.com

Trades: Levels, Ranges, Targets

 

USD/CAD. Sell from 1.3387 remains, target 1.3280’s to 1.3270’s. Short yesterday stopped at 1.3400. Stop was 25? pips. Currently running 77 pips profit.

Trades today

AUD/USD looking at sell 0.7659, most vital 0.7628, 0.7637, 0.7645 and 0.7647.  Shorts must get below 0.7630 and 0.7628. Not thrilled about this trade.

AUD/CHF. Overbought from 0.7400’s. Looking at sell 0.7625 if I can get it. Target at least 0.7595, and below 0.7685 then more profits to follow.

GBP/JPY. Sell points 127.92, 128.19 and 128.47. From 128.19 target 127.90 easily. Not alot of thrills here either.

GBP/USD. Must see at least 1.2279 to 1.2309 to sell. 1.2252 is a big line to crossi n order for GBP/USD to go higher. Hope I catch it.

EUR/CAD. Sell higher if seen below 1.4547 and 1.4567. may not see it.

All quick trades looking at today so far. More trades will post. Statements as well. Using 20 pip stops provided I can get perfect entries.

 

Brian Twomey, Inside the Currency Market, btwomey.com

 

Trades: Levels, Ranges, Targets

For interested friends and followers. A more detailed Trade Plan approach. Actual trades and statements will post here, same as last month.

 

USD/CAD. This pair is Richter Scale overbought from vital support lines at 1.3123 and 1.3069. I’m short this morning from high 1.3380’s.  A 25 pip stop was hit Friday and again the stop was hit this morning at 1.3400 because I couldn’t change the location fast enough. The target so far is 1.3224 to 1.3200. I will ride this trade to target and ride all week if I must. I see Friday US GDP coming in not so thrilling, so may assist USD/CAD lower. Why USD/USD? Its a terrific currency pair, has wide ranges at 66 daily pips, and is highly reliable.

EUR/CAD. I’m watching 1.4552 and 1.4565. My feeling here is short but current price is just below both resistance points.

EUR/GBP. I’m looking for higher 0.8950’s to 0.9000’s then short.

AUD/USD. Major supports at 0.7594 and 0.7592 should take AUD/USD higher from current 0.7602. Target is middle 0.7600’s. If supports break then short immediately.

GBP/JPY is a quick day trade, its not worth much more. Top of the channel is 127.51 and 128.71. But I’ve had many quick day trades in GBP/JPY  and all valued from 30 to 50 pips.

GBP/USD. As well a quick day trade and nothing more but always valued at quick 30 to 50 pips. GBP/USD is oversold yet its middle range. Top points above: 1.2454, 1.2357, 1.2270 and 1.2244. If USD/CAD goes lower then GBP goes higher.

GBP/CAD

GBP/NZD

AUD/CHF

 

Gotta run, more pairs posted upon return. The goal on these trades is at least 50 pip trades, hopefully more  with ? 20 ish pip stops.

 

Brian Twomey, Inside the Currency Market, btwomey.com

 

USD, GDP: Levels, Ranges, Targets

 

Almost 30 days into last month’s trades, the end result was 46 trades for about 1225 pips. The overall portfolio increased by 30%. The Win rate was about upper 80%. The average Stop loss was 70 pips. Many trades could’ve run for many more pips but I chose 50 pips as targets then exited for profit. The first month was complete with “Impressive Results”. This from those who scored the trades. A small loss occurred on the 3 GBP trades when USD CPI reported far higher than expected. I had to allow the trades run to the end so the overall stats reported weren’t severely skewed. Overall, the Scorers were impressed so now I graduate to the next level.  I highly recommend Pepperstone in Australia because of the many impressive Stats provided on trades.

Now month 2 just began on Thursday OCT 20. The goal for this month is to tighten stops and bring down the average from 70 pips. My goal is 20 ish pip Stops and this requires perfect entries. Then I will allow minimum 50 pip targets but I will also allow good trades to run. Secondly, the focus and goal is Money Management. What I want, what I need is a good Risk/ Reward Ratio in relation to how well money is managed. Then the Scorers apply further Stats to issue an average number. The overall objective is I’m going to work with these guys.

Thursday began with 3 trades, GBP/JPY and GBP/NZD. Those trades were exited with profits at 17 pips, 18 pips and 27 pips. I’m using a different system this month so wanted to get acclimated to the new buttons. Friday I profited 68 pips on GBP/JPY. So far 4 trades are + 130 pips. I will post my trades before as time allows. I’m currently short USD/CAD. I’m interested in trading this month, GBP/USD, USD/CAD, GBP/JPY, GBP/CAD, GBP/NZD and EUR/GBP. I like AUD/CHF as well but haven’t jumped yet this month.

 
Why low GDP readings from a technical perspective is because a significant cross over occurred in the averages. Averages 3, 4 and 5 year crossed below the 1 and 2 year. More importantly, 3, 4 and 5 year averages are now located below all averages from 1 to 10 years.
GDP Averages at 3, 4 and 5 year from 1.30, 1.76 and 1.80 must cross higher in order for GDP to rise further. Only then does GDP target 2.08, 2.12 and 2.15. Then begins the upper targets from 2.22, 2.30, 2.43, 2.45 and 2.55. The entire GDP range runs from 1.30 to the 10 year average at 2.55. GDP 1.30 is the first point to cross to begin entrance into averages from 1 to 10 years. Current GDP for the past 2 quarters traded below every average from 1 to 10 years.
Consensus estimates reveals 1.30 and a further indication the averages will continue a further drop for the upcoming 4th quarter. Low GDP is hardly US dollar positive. What is revealed in GDP is more of the same low, low readings year over year. As GDP averages continue to drop and as GDP fails to rise then the averages will take GDP lower over coming quarters. What is reported is Real GDP yet its the slow increase as a percent change quarter to quarter contributes to low Real GDP drops.
What drove GDP last quarter was higher PCE, Non Residential Fixed Investments and exports. More importantly is the drop in Private Inventory Investments as goods sold failed to see a replenishment in supplies.
The best GDP targets for the averages are highs at 1.68 and 1.72 and lows from 0.3 to 0.93.

 

Brian Twomey, Inside the Currency Market, btwomey.com

 

 

AUD/USD and Cross Pairs: Levels, Ranges, Targets

The commonalities in AUD/USD to its cross pairs are all sit on vital supports and includes AUD/USD. All cross pairs are overbought yet AUD/CAD and AUD/USD are oversold. AUD/CAD in the last report negatively correlated to AUD/USD at minus 59% but now correlates solidly at + 85%. AUD/JPY in the last report negatively correlated to AUD/USD at minus 67%, now negative 90%. AUD/CHF and AUD/EUR are most overbought in relation to all cross pairs. AUD/USD primary drivers are AUD/CAD and AUD/NZD because its ranges are far wider than AUD/USD and remainder cross pairs.
AUD/EUR is overbought almost to uppermost extremes. AUD/JPY and AUD/NZD remain negatively correlated to AUD/USD at minus 90% and minus 56%. AUD/CHF, AUD/CAD and AUD/EUR positively correlate to AUD/USD at +85%, + 85% and + 87%. AUD/USD positive correlation to AUD/EUR is responsible for AUD/EUR overbought extremes.
A correlation is a market indicator to send a message in regards to current prices are misaligned, misplaced, mis located and must eventually align to their rightful underlying pair. AUD/JPY and most JPY cross pairs except GBP/JPY align to USD/JPY. In range markets, mis aligned prices and correlations has potential to last for many months and under-perform in price moves as seen in the examples of AUD/JPY and AUD/NZD. In AUD/USD and cross pairs, more range bound markets are expected as has been the order for AUD over many, many months. Range markets hardly change a correlational effect or price under-performance until price breaks a significant point.
AUD/USD. Why AUD saw corrections in the low 0.7700’s and high 0.7600’s is because of the failure to break above 0.7801, a line dated not only to 1999 but a stasis line due to its inability to move over AUD’s range bound markets. The point at 0.7801 remains the big break level in order for AUD to move significantly higher to target easily 0.8100’s. The line at 0.7801 however lacks any expected break anytime soon because far overbought becomes the reality on any approaches to middle 0.7600’s and low 0.7700’s.
Current overbought and sell points from the 0.7612 close begins from 0.7628 to 0.7650’s. Any price above 0.7650 begins overbought extremes. Vital in between 0.7628 and 0.7650’s is current 0.7642 because this point is a range level . Range points are more important than market level.
On the downside is found supports at 0.7569 and 0.7578 and must breaks to see AUD achieve 0.7534, 0.7524 and 0.7520. Most important supports for AUD are located at 0.7486 and 0.7520. Why 0.7520 is because its a range point. A break of 0.7520 would see AUD far lower over time. The points at 0.7569 and 0.7578 decides AUD’s fate over coming days as both lines will travel higher as AUD rises to provide supports much higher than current. AUD/USD above 0.7569 and 0.7578 remains oversold.
AUD/CHF. From current close at 0.7542, AUD/CHF is far overbought from MA’s, from price distributions and any perspective viewed. A correction could easily take AUD/CHF back to 0.7470’s. What drives AUD/CHF are lines at 0.7399 and 0.7410. First short targets are found from 0.7507, 0.7503 and 0.7501. The upside in AUD/CHF is not only limited but longs not recommended but an overall sell rally approach to the week.
AUD/CAD. From current 1.0004, AUD/CAD was traditionally the primary driver to AUD/USD but has since experienced revolving negative to positive correlations therefore AUD/CHF constant positive correlations informs more superior to AUD/USD direction. AUD/CAD is oversold to middle range overall because 1.0004 lies just above most vital break points at 0.9962, 0.9935 and 0.9894. A break at 0.9864 targets overall 0.9611 yet far far down the road as traditional AUD/CAD was never a big market mover but is a traditional range currency pair. To see a run to 0.9962 and 0.9935 then breaks must be seen at 1.0004, 0.9976 and 0.9970.
On the upside, overbought and sell points begin at 1.0020 to 1.0049 to 1.0068. Sell point targerts back to 1.0005, 1.0000 and 0.9976.
AUD/NZD. From current 1.0745, AUD/NZD is overbought and any drops targets first 1.0700’s then 1.0680’s to 1.0660’s and 1.0648. The current and most immediate targets is 1.0697. The main break point to see lower is located at 1.0669. AUD/NZD sits on base of supports at 1.0510, 1.0569 and 1.0611. AUD/NZD will struggle to break lower at 1.0621 to 1.0636.
On the upside , AUD/NZD will struggle to break higher at 1.0812 and 1.0820’s to 1.0835 because 1.0871 continues to drop lower on AUD/NZD and its the main driving line. For the week, AUD/NZD is a sell rally strategy.
AUD/JPY. From current 79.44, AUD/JPY is trapped between vital break points at 81.19 above and 78.56 below. A break below 78.56 targets 77.66 in the immediate term. A run to 78.56 must see breaks at 79.05 and 78.81. Below 79.05, AUD/JPY enters a most dangerous neutral zone as 79.05 must clear to go higher while 78.56 provides solid support.
Intraday, AUD/JPY is overbought and sell on rallies for now is recommended. Most important points are 79.45, 79.63 and 79.71. AUD/JPY has potential to travel far higher but a correction is warranted. Above 81.19 comes next 81.32, 81.64, and 82.48.
AUD/EUR. The close at 0.6943 in AUD/EUR is highly overbought. Most important supports are located at 0.6794 and 0.6786. Why AUD/EUR is overbought and why its correlation of 90% to AUD/USD is because EUR/USD lost its correlation to EUR/AUD. Further AUD/EUR is far overbought because EUR/AUD is far oversold.

The close of AUD/EUR at 0.6943 is actually EUR/AUD 1.4402. The supports in AUD/EUR at 0.6794 and 0.6786 is actually EUR/AUD resistance at 1.4718 and 1.4736. AUD/EUR for the week will travel lower while EUR/AUD will travel higher.

AUD/EUR is far more overbought than is EUR/AUD oversold and the difference is about 100 pips. The side issue is once Asia trading ends and shifts to Europe, EUR/AUD is a most vital pair to AUD/USD and many times EUR/AUD due to its wide ranges drives the AUD/USD and EUR/AUD relationship.
The bottom most vital in EUR/AUD is located at 1.4066 and translates to AUD/EUR 0.7109. Upper targets for EUR/AUD are located 1.4581, 1.4598 and 1.4604. EUR/AUD targets translates to AUD/EUR 0.6858, 0.6850 and 0.6847.
EUR/AUD travels higher by breaks at 1.4424, 1.4450, 1.4474, 1.4493, 1.4516 and 1.4521. All translates to AUD/EUR 0.6932, 0.6920, 0.6908, 0.6899, 0.6888 and 0.6886.
Downside most oversold in EUR/AUD at 1.4399 and 1.4390 translates to AUD/EUR 0.6944 and 0.6949. The strategy is buy dips in EUR/AUD.

 

Brian Twomey, Inside the Currency Market, btwomey.com

TRUMP: DXY V EUR/USD, Yields, S&P’s

If Trump is a true William Howard Taft Capitalist / Republican in the spirit of Warren Harding, Calvin Coolidge, Herbert Hoover and Ronald Reagan and if he can overcome the Fabian Socialist tendencies of the current majority of Teddy Roosevelt Republicans / Democrats then prosperity will reign from 2016 to 2020. Many questions exist to the Trump/Taft scenario.
Trump’s economic plan not only advocates a slash of personal and corporate taxes, high GDP and pro growth scenario but the architects of the document are Taft Republicans from the Reagan administration. Most prominent names include David Malpass, Arthur Laffer and Stephen Moore. With Malpass, Moore and a pro growth agenda, economic conservatives from the Reagan era such as Larry Kudlow joined the Trump bandwagon to advocate Trump’s presidency. Advocacy for Trump is found more inside the philosophical economic agenda rather than strictly in the name of Trump.
America began as an idea, an ideal, a thought, a philosophy to represent a chosen group of people whose desire was independence as people as they fled heavy handed government. The 1912 election between Teddy Roosevelt and William Howard Taft split the independence agenda into left thinking big government as solution to political, social and economic problems by Roosevelt or Conservative small government and independent capitalism under Taft.
The small government conservatism under Thomas Jefferson merged with the Radicalism big government agenda under Andrew Jackson and formed the modern day Democratic Party. William Jennings Bryan’s 1896 Cross of Gold speech sealed the Democratic Party’s fate as permanent big government as solution. Trump and the Taft wing of the Republican Party now stand as a minority view particularly under the economic agenda.
Proposed Corporate taxes drop from 35% to 15% while individual tax brackets cut from 7 to 3 with lower tax rates to 12%, 25% and 33%. The idea is 1.2 million jobs are created for every 1% of higher GDP with an overall goal of 4% GDP and 3.6 million jobs created. Job creation assumes conglomerate US companies leave locations in Ireland and other tax friendly havens and return home as well as agree to repatriate monies to employ inside the US economy.
Since all revenue and tax bills by constitutional Article 1, Section 8 originates from the House of Representatives and a clear majority of Republicans will continue its House dominance as well as small majority in the Senate, Trump’s plan has every ability of easy passage. From an economic perspective, Trump could easily become not only a Taft Republican to lead prosperity but has every ability to switch back to Reagan’s winning Supply Side economic system from the current hocus pocus, tool box tricks of Obummer’s Keynesians.
Trump’s first hurdle is elimination of stimulus in order to allow interest rates to free float and to understand where true real and nominal rates of interest rates are located. The current yield curve is suppressed from 2 to 5 year maturities as the vast majority of stimulus bonds are reinvested from 2 to 5 years. This created a yield curve steepener from 10 to 30’s. Fed Funds Effective is purposefully held at 0.40 to allow the artificially created corridor from 10 to 20 to hold Fed funds in place.
If stimulus is rescinded, not only will yields rise but yields travel higher because economic data will materially improve as stimulus and economic data negatively correlate. Stimulus and interest rates also negatively correlate. Add lower tax rates to the equation then the US sets up to become an economic powerhouse with yields and interest rates leading the way.
The risk to the current yield curve scenario is higher GDP, lower taxes, higher interest rates must see the short end 2 to 10 year maturities rise. If short maturities lead an economic expansion then the longer 10 to 30’s generally fall. The short end rise over time threatens a flat yield curve and flat yield curves warn of recessions ahead.
The current 2 to 10 spread runs 0.88 V the 10 to 30 at 0.73. The 10 to 3 month rate runs 1.32 and just below the 20 year Natural Interest Rate at 1.64 yet 1.32 is 90 basis points higher than the 0.40 Fed Funds rate. The 10 minus 3 month typically equates to the domestic interest rate and in the caee of the US its 0.40 so 90 runs high yet overall the yield curve message is the Trump economic plan has ability to implement and run over time without recession threat.

The 2 year yield must break 1.170 to experience an upward trend . The point at 1.170 is a level last seen in monthly averages exactly 8 years ago and at the time of the 2008 crisis.

What determines direction to markets is the DXY and EUR/USD relationship as both currencies were designed as polar opposites. Currently, both DXY and EUR/USD sit together exactly on trend lines from 2 to 10 year monthly averages. The market message is not only refrain from long term positions but uncertainty is evident as to overall direction. A break will and must occur and this break informs other currency pairs, commodities, stock markets and whether markets enter risk on or risk off mode. Further, a break informs the success or failure to the next president.
Assume DXY breaks higher and EUR/USD travels lower then commodities will head lower and includes WTI because of negative correlations DXY generally shares against a vast majority of commodities. A lower DXY, higher EUR/USD imparts the message USD yields and interest rates trade lower. A higher DXY is the first sign to a vote of confidence in a Trump economic plan and overall administration. Viewed from the Hillary Keynesian perspective and increased tax rate policy, a higher DXY, interest rates and yields offers a vote of no confidence to an economic recovery.
DXY along the curve to 10 years must break lower at 95.32 then 90.70, 88.37, 86.70, 85.61, 84.41 and 84.21. Then next 83.18 nd 83.08. Overall, DXY began at the 2008 crash at 78 and 77.00. Once broken above, DXY traveled to 105.’s to current 95.00’s.
The current S &P 500 Price / Earnings Ratio is 24.59 and ranged historically to a high of 45 as an average to its historic average at 15 lows dated to the  1900’s. Overall, 24.9 is high yet it represents a fairly rangebound, non trending market and representative to the DXY V EUR/USD dilemma. What drove the S&P’s higher since 2008 was the Price in PE in a low inflation and low interest rate environment against a low PE Ratio near its 15 lows. What will drive the S& P’s in a Trump Administration is a number of factors.
Lower corporate taxes and higher GDP will send the S&P’s higher because the E as Earnings for corporations will expand to drive the P higher as well. Add higher yields and interest rates then the stage is set for higher S&P’s. The perfect example is found under Reagan in the 1980’s.
The overall question and main driver to the S&P’s historically is Inflation. Higher Inflation drives PE Ratios and S&P’s lower and the best evidence is seen in 20% Inflation rates in the 1970’s.
The overall higher or lower Inflation question in a Trump Administration should be a lower Inflation rate if stimulus is rescinded and this will drive the S&P’s higher. Higher Inflation is not worth the added premium expense factored to a stock or index price in profit return. Under Hillarious as is the term for Hillary Clinton, not an ounce of confidence exists to consider higher S &P’s due to a higher Tax plan and more of the same Keynesian policies in higher Inflation rates. Add current 24.59 PE Ratio then long S& P’s becomes a risky investment. Why 2% Inflation is because it supports the higher money supply. Further, 2% meets the bottom 10 to 20 basis point and artificial corridor inserted under the current 0.40 Fed Funds rate.

 

Brian Twomey, Inside the Currency Market, btwomey.com

Brian Twomey: Trade Results

  In Aussie dollars
  Net Profit = Total = 40.56, Longs= 9.09, Shorts = 31.47
 Profit Factor = Total 170.00, Longs = 38.88, Shorts = ?
 Commission = Total = Minus 1.20, Longs = minus 0.34, Shorts = minus 0.86
 Drawdowns = 0
 Total trades = 19. Longs = 5, Shorts = 14
 Winners = 18. Longs = 4, Shorts = 14
 Max consecutive Wins = 11, Longs =3 , Shorts = 14
 Largest winner = 5.05, Longs = 3.17, Shorts = 5.05
 Largest loser = minus 0.24  GBP/NZD minus 2 pips. 
 Avg Trade = 2.13, Longs = 1.82, Shorts = 2.25
 Sharpe Ratio = Total = 1.68, Longs = 1.32, Shorts = 1.78
 Sortino Ratio = Total = 3.81, Longs = 1.77, Shorts = ?
   Total Pips  Banked 700 ish, 3 GBP long trades outstanding from CPI, Friday USD/CAD and AUD/USD appeared below from Friday? Not sure. That was 50 pips total for both. Hitting only 50 pip trades then out. This week, maybe we shoot for more higher per pip trades.
  file:///C:/Users/Brian/Downloads/cT_3165406_2016-09-30_10-12%20(1).htm  Full Statement.
ccount Statement
Pepperstone
Account : 3165406 30/09/2016 14:11:42.556, UTC +0
Currency : EUR
History
Totals ID Symbol Opening Direction Closing Time (UTC+0) Entry Price Closing Price Closing Quantity Closing USD Volume Swap Commission Gross EUR Net EUR Balance EUR Pips
DID10444331 USDCAD Sell 15/09/2016 16:16:12.169 1.31965 1.31460 0.01 $ 1 000.00 -0.03 -0.06 3.42 3.33 10 003.33 50.5
DID10444332 USDCAD Sell 15/09/2016 16:16:20.492 1.31684 1.31449 0.01 $ 1 000.00 -0.03 -0.06 1.59 1.50 10 004.83 23.5
DID10444334 USDCAD Sell 15/09/2016 16:16:25.225 1.31683 1.31450 0.01 $ 1 000.00 -0.03 -0.06 1.58 1.49 10 006.32 23.3
DID10454856 USDCAD Buy 16/09/2016 10:28:12.123 1.31489 1.31969 0.01 $ 1 000.00 -0.01 -0.06 3.24 3.17 10 009.49 48.0
DID10473589 GBPCAD Sell 16/09/2016 13:16:11.317 1.74091 1.73619 0.01 $ 1 311.10 -0.08 3.19 3.11 10 012.60 47.2
DID10500893 USDCAD Sell 19/09/2016 02:52:05.628 1.32092 1.31562 0.01 $ 1 000.00 -0.01 -0.06 3.61 3.54 10 016.14 53.0
DID10547534 USDCAD Sell 21/09/2016 12:16:23.223 1.31817 1.31421 0.01 $ 1 000.00 -0.02 -0.06 2.70 2.62 10 018.76 39.6
DID10566989 GBPNZD Buy 22/09/2016 02:36:45.087 1.77300 1.77602 0.01 $ 1 303.70 -0.47 -0.08 1.98 1.43 10 020.19 30.2
DID10587740 AUDUSD Sell 22/09/2016 22:19:29.286 0.76628 0.76450 0.01 $ 764.50 -0.05 -0.04 1.59 1.50 10 021.69 17.8
DID10587741 AUDCAD Sell 22/09/2016 22:19:35.703 0.99847 0.99742 0.01 $ 764.50 -0.05 -0.04 0.72 0.63 10 022.32 10.5
DID10621243 GBPCAD Buy 23/09/2016 12:30:02.055 1.69229 1.69683 0.01 $ 1 296.87 -0.08 3.09 3.01 10 025.33 45.4
DID10658037 GBPNZD Buy 26/09/2016 12:58:38.044 1.78231 1.78206 0.01 $ 1 294.30 -0.08 -0.16 -0.24 10 025.09 -2.5
DID10680358 EURGBP Sell 27/09/2016 12:24:01.352 0.86892 0.86449 0.01 $ 1 121.69 0.01 -0.08 5.12 5.05 10 030.14 44.3
DID10712324 GBPNZD Sell 28/09/2016 12:10:52.017 1.79686 1.79287 0.01 $ 1 301.28 -0.08 2.58 2.50 10 032.64 39.9
DID10714462 GBPNZD Sell 28/09/2016 13:34:41.032 1.79612 1.79305 0.01 $ 1 301.29 -0.08 1.99 1.91 10 034.55 30.7
DID10722406 USDCAD Sell 28/09/2016 18:32:18.996 1.31389 1.31069 0.01 $ 1 000.00 -0.03 -0.06 2.18 2.09 10 036.64 32.0
DID10723148 USDCAD Sell 28/09/2016 18:55:28.025 1.31195 1.30871 0.01 $ 1 000.00 -0.03 -0.06 2.21 2.12 10 038.76 32.4
DID10744428 AUDUSD Sell 29/09/2016 17:14:08.426 0.76608 0.76577 0.01 $ 765.77 -0.16 -0.04 0.28 0.08 10 038.84 3.1
DID10762226 AUDUSD Buy 30/09/2016 12:47:13.566 0.76179 0.76376 0.01 $ 763.76 -0.04 1.76 1.72 10 040.56 19.7
Totals -0.91 -1.20 40.56
Positions
Totals Symbol Volume Direction Entry Price T/P S/L Created (UTC+0) Last Modified (UTC+0) Label Comment Pips Gross EUR Net EUR
GBPJPY £ 1 000 Buy 132.426 20/09/2016 09:15:58.757 29/09/2016 21:04:04.743 -90.2 -7.94 -7.78
GBPUSD £ 1 000 Buy 1.31581 1.31901 16/09/2016 12:36:37.582 29/09/2016 21:02:10.804 -181.2 -16.17 -16.55
GBPUSD £ 1 000 Buy 1.31090 16/09/2016 13:22:07.390 29/09/2016 21:08:11.529 -132.1 -11.79 -12.17
USDCAD $ 1 000 Buy 1.31075 1.31375 30/09/2016 13:14:24.722 30/09/2016 13:20:35.112 0.7 0.05 -0.01
Totals -36.51
Orders
Totals ID Direction Order Type Submitted Time (UTC+0) Symbol Current Quantity Current Volume Submitted Price Distance T/P S/L
– No Orders –
Transactions
Totals ID Time (UTC+0) Type Amount EUR Note
TID9868062 13/09/2016 15:20:37.707 Deposit 10 000.00
Summary
Deposit 10 000.00 Equity 10 004.05 Margin 11.00 Balance
Withdrawal 0.00 Unrealized P&L -36.51 Free Margin 9 993.05 10 040.56
Total Net 10 000.00 Realized P&L 40.56 Margin Level 90 947.27%

EUR/USD V DXY September 2016: Levels, Ranges, Targets

EUR/USD and the US Dollar Index, DXY, every month since October 2015 traded between 1 and 2 year monthly averages and on the 1 year anniversary in October 2016, EUR/USD and DXY again will trade between 1 and 2 year monthly averages.
DXY’s range last month at 166 pips was the lowest range since I first reported the DXY V EUR/USD relationship every month from October 2015 but then came October 2016. DXY’s range for October 2016 at 118 pips graduates to the lowest monthly range and factors to 5.9 pips per day in a 20 day trading month. September’s 166 pips factored to 8.3 pips per day and actual was 176 as DXY traded between 94.41 to 96.17.
EUR/USD range for September was 258 pips and traded actual 228 or 11.4 pips per day from 1.1100 to 1.1328. EUR/USD range for October 2016 factors to 188 pips or 9.4 pips per day and the lowest monthly range since first reported from October 2015.
Ranges for EUR/USD and DXY began a serious compression since January 2016 as DXY topside began at 100 and dropped every month to current 96.70 while EUR/USD’s range began January 2016 at 1.1600 to October 2016 at 1.1294. Range compression for September and October 2016 account for bottom rises rather than further topside drops in the averages.
DXY September range was 96.79 to 95.13 while October factors to 96.70 to 95.52. The topside dropped 9 pips while the bottom rose 39 pips in an overall 118 pip range. The top of the monthly range at 97.46 translates to EUR/USD 1.1080’s. DXY will seriously struggle from 97.01 to 97.46 upon a 96.70 break. To travel higher, DXY must cross 95.51, 95.62, 95.86, 96.48 and 96.62. Then begins 97.01, 97.05, 97.20, 97.30 and range top at 97.46.
DXY bottom average at 95.13 is reinforced by 95.18 and 95.10. A break of 95.10 targets next 94.70, 94.66, 94.51, 94.25 and begins 93.00’s at 93.98. DXY 94.00’s translates to EUR/USD upper 1.1300’s.
EUR/USD September’s average was located from 1.1364 to 1.1100 while October is found from 1.1294 to 1.1106, a 188 pip range. The October topside dropped 60 pips from September while the bottom rose 6 pips. EUR/USD brick walls for October above 1.1294 are located at 1.1307, 1.1394, 1.1435, 1.1469 and 1.1554. EUR/USD travels higher by breaks at 1.1226, 1.1237, 1.1279 and 1.1282. Top of the channel at 1.1801 is down 83 pips from September’s 1.1884.
EUR/USD downside is solid at 1.1101, 1.1095, 1.1081, 1.1028, 1.1016, Then begins 1.0924 and 1.0871.
To repeat from last month and viewed from the 1 year trend line, the line is almost completely horizontal and both DXY and EUR/USD trade below. Any price rises and even exhorbitant rises is a correction for both DXY and EUR/USD. DXY and EUR/USD trade below the 2 year descending trend line and each hug middle portions of the lines from 2 to 10 years and every year in successive order.
Most important is topside trend lines for both DXY and EUR/USD in monthly averages 1 to 10 years continues to drop slowly every month and contains price rises. Because both DXY and EUR/USD trade below or hug trend lines, bottoms rise due to oversold price conditions . If a bottom line drops then the topside must rise and as this continues month to month, trend lines are heading to complete vertical. At some point a reversal must be seen but its not evident anytime soon.
Further problem to the EUR/USD story is correlations run negative 52% to EUR/JPY, negative 38% to EUR/AUD, negative 59% to EUR/NZD while EUR/GBP runs best positive correlations at + 60%, + 11 to EUR/CAD and +27% to EUR/CHF. EUR/USD on its own volition lacks ability to run on all cylinders to its cross pairs.
Intraday and for the week, most important lines to watch are 1.1174 and 1.1210. Both must break to see EUR/USD downsides to 1.1095 and 1.1080’s yet both lines as support takes EUR/USD higher. What is seen for the month is more of the same ranges and not a breakout.

 

Brian Twomey, Inside the Currency Market, btwomey.com