EUR USD - Fixed Stop Strategy ( 9th update)
Issued on June 04 2012 par Gilles
1.24355 for Sept,21's Forward Contract on EURUSD, P&L $ + 1724.90, it's time to close that trade !
Target has been reached, 1.2290 at low on the EURUSD spot.
It's now time to close this trade.
I - The situation :
According to Reuters, "The intensifying euro zone crisis and uncertain global growth outlook have raised hopes for a policy response from major central banks but, while it could be a close call, they are likely to resist pressure to act in the coming week.
The European Central Bank, the Bank of England and the Reserve Bank of Australia are all due to meet as data emerges on the euro zone's service sector, and the manufacturing and trade performances of the big German and U.S. economies.
The main focus will be Wednesday's ECB meeting, and whether dramatic selling of peripheral European government debt by investors in May and a flight into safe-haven U.S. Treasuries and German government bonds will prompt it to act.
One reason to doubt a major shift in policy is that, even after U.S. Treasury 10-year notes hit yields not seen in more than two centuries of record keeping, and investors began paying the German government for the right to hold its debt, the move across all markets may not warrant it.
"The stresses appear not yet to be big enough across all asset classes for the policymakers to react," said Richard Batty, global investment strategist at Standard Life Investments.
"It all seems to be playing out in investor's appetite for triple-A government bonds and for the dollar, but there doesn't seem to be the volatility or sharp falls in equity markets or other stresses in the system, such as the funding market."
In Europe, the spread between three-month Libor rates and overnight rates, seen as a measure of health of the banking system, has been stable throughout May - mainly due to the more than one trillion euros of cheap funds injected into the system by the ECB in December and February.
And while May was a bad month for equity markets everywhere and Spain and Italy in particular, the widely watched Dow Jones .DXY and S&P 500 .SPX indexes remain in positive territory for the year to date."
II - Chart :
III - Stratégy :
We sold short forward contract on EUR USD that is currently worth :
Our net price is 1.301253, that leads to a P&L of :( 1.301253 - 1.24355 ) . 30000 - 6.20 = $ + 1724.90
IV - Stop Orders
Stop Orders :
Buy 30000 forward's 2012 Sept 21 at 1.24355 and close the trade
Previous : EUR USD - Fixed Stop Strategy ( 8th Update)
Original Strategy : EUR USD - Fixed Stop Strategy
Possible Early Closing :
EUR USD - Fixed Stop Strategy ( 5th Update)
EUR USD - Fixed Stop Strategy ( 6th Update)
$ + 808.20
EUR USD - Fixed Stop Strategy ( 7th Update)
$ + 1071.30
EUR USD - Fixed Stop Strategy ( 8th Update)
$ + 1580.10 Gilles
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Five-years credit default swaps on the German Government Bonds