Thursday, August 21, 2008

How High can the Euro go?--IFCN Wk 37 -Thu- Equity: $830.60.

Now that the dollar has gotten significantly stronger-- and quickly over the last few weeks, now the questions being asked are, “how far can currencies like the Euro or British pound rally against the dollar before succombing to weakness again?”

We have achieved a bit of softening to the dollar over the last few days. It took a lot of news about oil prices going up, struggles with Russia, uncertainty of the US economy, coming elections. A whole bag of things--- just to get a small rebound in the other currencies.

We will be watching.

The important thing to remember is, the path of least resistance demonstrated by currencies is for the dollar's continued strength.

Even with literal saber-rattling from Russia, ultimately the world knows that the US is the one to bet on. Russia has too much to lose from playing hardball.

They've gotten used to Western products and have little capacity to make their own. Since the major economy in Russia is profiting from professional hooligans, international trust issues towards Russia are fading fast where financial matters are concerned.


It is unlikely that we will have any OneNightStand trades for Friday. But the orders will go in as usual.

We lost the short Gbp/Usd trade for a loss of 60 pips. That means we have 2 FirstStrike trades going into Friday.

The following is the status of this week's FirstStrike entries:
  • Eur/Usd: Short @1.4695, stopped at 1.4755 for 60 pip loss.
  • Gbp/Jpy: Short @205.32, stopped at 206.22 for 60 pip loss.
  • Gbp/Usd: Short @1.8639, stop 1.8699. Trade in progress.
  • Usd/Chf: Long @ 1.0985, stopped at 1.0925 for a 60 pip loss.
  • Usd/Jpy: Short @ 109.77, stop 110.37. Trade in progress.
Any FirstStrike trade not stopped out before Friday-- exits on Friday just before 15:00 CST.

Have a good Friday.

Current equity is $830.60.

Joel Rensink

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