Now Reading
Coiling Currencies
44

Coiling Currencies

by The MoleOctober 6, 2016

In the end it’s all about the money and more specifically what happens on the currency side. Although Forex trading has effectively been turned into a small sideshow in the United States, due to stringent Dodd Frank regulation that mainly affected retail traders, it would be a mistake to not pay attention to what’s happening on the currency side. And what I’m seeing across the board, on a long term basis, is rather disconcerting.

2016-10-06_eurusd_lt

Frankly the overall theme does not require much explanation and I will let the charts do the talking. Here’s the EUR/USD which is probably the most salient representation of what’s going on here. This thing is so tightly wound that I’m afraid it’ll snap any moment.

2016-10-06_usdjpy

The USD/JPY may actually be the first one to go as it just breached upside resistance and is nibbling on a weekly NLBL. Maybe it’s pointing the way?

2016-10-06_usdcad

USD/CAD looking rather bullish but also coiling up, most likely awaiting the November election.

But wait, there’s more…

evil_separator

It's not too late - learn how to consistently bank coin without news, drama, and all the misinformation. If you are interested in becoming a subscriber then don't waste time and sign up here. The Zero indicator service also offers access to all Gold posts, so you actually get double the bang for your buck.

Please login or subscribe here to see the remainder of this post.

Bottom Line:

It’s entirely possible that the smart play here is being long the USD. It’s the least smelling fish in the barrel and if it all comes crashing down – what’s the alternative? The Euro? The Renmimbi? The fickle Swiss Franc or worse, the Yen with those kamikaze pilots at the helm? Cash is a position, especially if it involves the U.S. Dollar.

100_dollar_treasury_note

Maybe I’ll even live long enough to see one of those again.


About The Author
The Mole
Mole created Evil Speculator amidst the chaos of the financial crisis in early August of 2008. His vision for Evil Speculator is a refuge of reason, hands-on trading knowledge, and inspiration for traders of all ages and stripes. You can follow him and his nefarious schemes at the usual social media waterholes.
Enjoyed this post? Consider a small donation to keep those evil deeds coming!

BTC: 1MwMJifeBU3YziDoLLu8S54Vg4cbnJxvpL
BCH: qqxflhnr0jcfj4nejw75klmpcsfsp68exukcr0a29e
ETH: 0x9D0824b9553346df7EFB6B76DBAd1E2763bE6Ef1
LTC: LUuoD6sDWgbqSgnpo5hceYPnTD9MAvxi6c

  • OJuice

    Coiling up for Brexit Part 2: Trump does The White House. It’s been mostly character attacks from the liberal media so far. I’m sure they will fire up some commentary on the impending economic doom that will result if he is elected.

  • Mark Shinnick

    The “what do you have to lose” argument was pretty good. Show home ownership graph past 8 years should help make the point. “Hope” “Change”

    https://uploads.disquscdn.com/images/7cd41a29be2134b7dd59cdd882965deec3908cef01051d3e074ca3ac2bf9630e.jpg

  • http://evilspeculator.com Sir Mole III

    That is fucking depressing.

  • http://evilspeculator.com Sir Mole III
  • http://evilspeculator.com Sir Mole III

    Strangely enough (given recent headlines) we have gun homicide rates at all time lows. Nevertheless the sentiment among the populace is very negative – people are arming themselves.

  • OJuice

    I work in manufacturing and most all of the guys that work for me are voting Trump. For fun we all took surveys to see where we fell on the left vs right population distribution. Most all fell slightly center left or center right. The general consensus is “fuck DC and fuck the fortune 100. If they all dislike Trump then he’s our man.”

  • Mark Shinnick

    “The Peacekeeper”

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    ..almost worthy of a down vote.
    why?
    1) ZeroHedge tag on the bottom of it. 😉
    2) Chart is zoomed into a range of 62 to 70% – zoomed charts are unnecessary drama IMHO.

    -GG

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    Price may be hanging in there…but sentiment? speaks volumes.
    [BPSPX]
    http://stockcharts.com/h-sc/ui?s=%24BPSPX&p=D&yr=0&mn=6&dy=0&id=p02855803153
    😉

  • randomuser6789

    Yes, Zero Hedge is a strike against it.
    But I took note of the scale, and it is still relevant and significant data. [Always take note of the scale!]

  • Mark Shinnick

    Yeah…just needs some convenient excuse for a trigger. Oh wait…that’s in more normal times ;/

  • OJuice

    The graph starts in 1965 so I would have to say the scale adjustment is acceptable. Zerohedge does have bias like all media outlets, but I appreciate all the data and info that it does disseminate.

  • Yoda

    Yeah, can’t argue with the bullish looking DX chart.

  • Mark Shinnick

    The vols seem to be basing relatively well. The boyz could be loading-up on the options… I know I am. Went short oil too.

  • Yoda

    GC hit the 200 d sma today. A fall below that would be psychologically very depressing for the bugs.

  • Mark Shinnick

    Yeah, this $ thing could change some minds.

  • http://evilspeculator.com Sir Mole III

    hehehe

  • Mark Shinnick

    Hopefully we can get some equity rally to blow out some bears.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    disseminate, or inseminate?

    ok, let’s not go there.
    LOL.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Yoda

    Wow an algo just went into overdrive

  • OJuice

    A little foreplay for tomorrow maybe. NFP and maybe even an announcement from the Justice Deprtment on the DB fine…

  • http://evilspeculator.com Sir Mole III
  • Yoda

    I think I reached my puke point already with this tape. Considering taking a break from trading until Nov 8th.

  • Mark Shinnick

    You would not be alone, big time I believe. That might be the best reason to stay; the best moves often seem to happen when no one is watching.

  • kudra

    any love out there for GDX? or is no one touching that before gold hits 1200? where’s Riding? he was hot for the miners.

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb

    no love from my corner.
    given the big move, I discern to the weekly chart. tried and true.

    another few bucks red, is not far from sane prognostications.

    [GDX weekly]
    http://stockcharts.com/h-sc/ui?s=GDX&p=W&yr=3&mn=0&dy=0&id=p36285666041

  • Yoda

    You may be correct, but the feeling is there nonetheless

  • http://evilspeculator.com Sir Mole III

    Yes – I’m split between these two perspectives myself.

  • Yoda

    FWIW, it has now retraced a 50% fib from the up move that started in Jan 2016

  • http://gerb-reloaded.blogspot.com/ Gold_Gerb
  • Mark Shinnick

    Quite helpful.

  • Mark Shinnick

    My impression is that gold is oversold for the time being as may be the $ a bit overbot….but respect whatever you perceive is the trend.

  • Billabong

    You’re on target … It’s all about the $$$. USD/JPY and DX have been climbing for the last 8 trading days. For PM traders, I would wait for the $ to begin rolling over (and it will because this is a global currency debasement issue). I noticed no much being said about the petrodollar trade … CL has been flying the last 7 trading days (really think this is about a cut in global production) 😉

  • Yoda

    Given how loud the drums of war in Syria are beating I wonder how deep the PM correction will be.

  • Billabong

    Maybe we should be looking at weapon manufacturers … lots of money in small arms, bombs and bullets ….

  • Billabong

    Already past 50% on some of the miners and closing in on 62% … Trend sell-offs can be vicious.

  • http://evilspeculator.com Sir Mole III

    Are we going to churn like this into the election? I may just take the month off then…

  • ZigZag

    We have a day with 5 10 point es swings in a row, then we get like 12 2 point swings in a row after a somebody-something-something jawboning rally. This bothers you? 😉

  • http://evilspeculator.com Sir Mole III
  • http://evilspeculator.com Sir Mole III

    Oh noooo – it’s just so much fun! I actually enjoy watching it all day while I stick needles underneath my fingernails.

  • OJuice

    Looking good so far.

  • http://evilspeculator.com Sir Mole III