My short is still open and waiting.....patiently..
..
Sam--I agree that given this pattern it could go up...but I'm counting on a SHORT here..(obviously
). But really it could go either way in the pattern... FWIW, I think the short is the better more logical play based on the charts and data for the UK.. However if it should tag me out at 210.70 I will *consider* a reverse on the trade to go long..but we'll see what happens... These pairs keep acting wierd I may not trade again til after July 4th and just take the rest of this month off..
For the GBP--I don't see the boost that can carry it up there right now and I'm not sure what has driven it this high so far... The UK is facing its own forecast 4% + inflation right now...and the data is showing the prices increasing. Plus the RICs data for housing this week showed the lowest number of transactions for homes in 30 years...nobody is buying anything.. here is a snippet from Thompson Financial in London...
Quote:
LONDON (Thomson Financial) - The number of chartered surveyors reporting falls in house prices fell slightly during May, but the quantity of transactions completed fell to its lowest level for 30 years, the Royal Institution of Chartered Surveyors said today.
In its monthly survey of the sector, RICS said 92.9 percent more of its members reported house prices fell rather than rose in the three months to May. This was a slight improvement from April's record low of -94.7 percent and beat analysts' expectations for a reading of -97 percent.
However, it still indicates the market is struggling with surveyors in East Anglia and the South East unanimous that house prices area falling.
The average number of transactions per surveyor over the last three months stands at just 17.4, the lowest level since 1978 and down on April's 18.5.
RICS spokesman Jeremy Leaf said the deterioration in the housing market is likely to spell trouble for the wider economy.
'The property industry will not be the only casualty in the fall out from the credit crunch, with the high street and purveyors of a range of household goods, including furniture and white goods also feeling the pinch,' he said.
'Construction workers such as plumbers and bricklayers will start to see employment opportunities dry up as the pace of housing transactions continues to abate,' he added.
However, RICS said that until unemployment starts to rise significantly, a drop in the number of homeowners putting their property on the market should prevent a major house price crash.
'The lack of new instructions to sell property continues to provide the market with some support in the near term,' it said. |
Technically, The Pound is hovering between various 200EMA's on Monthly, weekly and Daily charts which have formed a nice range for it to slide between..but this is still acting a bit wierd. While I could see it hit 216.60's based on a Daily 200 EMA--cause the hourly and daily 200's LOVE to be stroked on swing moves...I see it more likely to test the 207.60 area hourly 200EMA before it tries for a daily or longer time MA...but your guess is as good as mine..
Right now the GBP is shrugging off a lot of data issues...and thats gonna bite them later if it doesn't correct and reverse off these highs IMO.. So I can't figure out what would drive it higher given the strong potential for severe inflation, the strong potential for unemployment to rise, and higher prices faced in the UK sharply slowing in their economy... If anything its lots of speculators thinking the UK banks are gonna do some fancy interest rate thing because of the high PPI and forecast inflation etc and they may be driving the pound higher to try to boost the economy..but its a temporary fix and its giveing several key banking folks a good position to short the Pound right now..
If anything--the BOE will most likely HOLD on their rates til the Fed decides to do something or gives further sign of how they will handle things--the Fed and other central banks are not gonna cut or boost rates before the summer...things are still too new and too wishy-washy with he oil price issues to determine how to respond right now. Even the CAD--which was expected to cut another .25bp but they held their rates firm at 3% in spite of forecasts and in spite of concerns..
Its like a small bubble is forming here and across the board on many currencies..lots of eager anxious speculators driving things opposite..and its bizarre... The pre-summer wierdness... This is JMO....
-w
