Thursday, August 7, 2008

Despite Adversity, Patience wins out! --IFCN Wk 35 -Thu- Equity: $755.34.

"He that can have patience can have what he will."

Benjamin Franklin

Most don't remember that Benjamin Franklin was our nation's prime mover helping to establish the paper currency system in America. His early currency exchange provisions enabled our flegling country grow to the behemoth it is today. Whether for an ultimate good – or bad result, time will tell; he did understand economy and the proper use of money. He considered it a tool to be used adroitly and at the right time.

This was the right time to be involved buying the dollar and selling almost all other currencies.

Concerns about growth of world economies slashing demand for commodities are prompting traders to sell most currencies vs. the U.S. dollar. Countries such as Australia and Canada export many major commodities, such as oil, natural gas, and base metals. This drop in commodity demand and prices makes their currencies vulnerable too.

At the same time, weakening global growth and softer oil prices have led European investors to return to the greenback as a safe-haven currency.

Because of these forces, this has turned out to be a very good week for FirstStrike.

We are still in 2 FirstStrike trades that are profiting nicely. The only way things could be better would be if we still had the Usd/Jpy trade working for us, and of course a short in the Euro. Finally the world has come to a realization that the dollar should not have been sold as deeply as it was.

That is the nature of free markets. They overdo and then correct themselves, usually at the expense of the most irrational. The key to profiting is having robust methods for determining reasonable entries in the (temporarily) unreasonable market.

The following are this week's remaining FirstStrike entries:

  • Gbp/Usd: Short @ 1.9686, stop 1.9746. Trade in progress.
  • Usd/Chf: Long @ 1.0530, stop 1.0470. Trade in progress.

Note: Any FirstStrike trade not stopped out before Friday gets exited on Friday just before 15:00 CST.

Current equity is $755.34.

I do have serious concerns about the profitability of any OneNightStand trades that might be executed tomorrow. With the extreme moves that have taken place already this week, the likelihood of most of the markets energy being spent is great. I'll still take the trades.

See you tomorrow.

Have a good evening.

Joel Rensink

PS: To receive the FREE! trading rules for the Infiniteyield Forex Challenge ($499 value) and the semi-monthly newsletter about this challenge, send an email to: and tell me to which address you would like it sent. Please do not use AOL, Yahoo or Hotmail addresses. Nothing personal, but they've been known to filter out more good mail than actual spam. Try a Gmail address. It's free, simple and perfect for traders!

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