Back To Trading in 2009!

Hello dear readers, it is good to be in the trench again, after a long break.

As i had told most of my folks, the last 2, maybe 3 weeks have been pretty low on volume and will have been rather irrational to trade on. With some brokers like IBFX, slapping crazy pip spreads on trades just didn’t make sense! Remember, the market is always there, whether you are there or if it is suitable for you or not is the main question. It wasn’t suitable for me, so i stayed out.

This is the good thing about the market. It forces you to take “leave” every Sat and Sun and now year end as well. I have been taking such year ends off for the last 2 years. It is like your company forcing you to clear your leave entitlement, only problem is that you are not paid in this situation.

Well, back to our forecast today. I don’t see any immediate trends or bias towards any of the majors. Market has been rather quiet for the holiday period and there are mixed sentiments for which i will not put my money on the line.

The overal USD sentiments are still bearish. The last US consumer confidence report release showed that confidence is worst in over 41 years. This really means trouble as more consumers are going to cut down spending. Under the keynesian model, more savings would mean longer recessions and more spendings will mean quicker recovery. We don’t know how this will shape up but we will have to wait and see. The Automobile industry is still hanging on a lifeline.

The immediate crisis between Israel and Gaza is causing unstability in middle east and is causing oil prices to trickle upwards. You can look at my charts section, that at the point of writing, it has gone up about 1.84%. Our friends at OPEC will be surely happy but this might cause impending bearishness towards USD with CPO having very high correlation towards it as wel. I am not sure if this will cause immediate onslaught against the dollar, but it is more reasons to consider a downtrend for the USD.

Bottomline

I am undecided about the market today. I will need more data and sentiments to kick in before i can point in any direction. I might stay out of the market and see where the trend is going.

Asian stocks and equity markets are doing well, and the Yen is still surging forward. I might consider short term sells on GBP/JPY, EUR/JPY. Stay out of USD/JPY.

All the best,
Seeni

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