Monday, November 19, 2007

Market's looking for a Rate cut....

So the WSJ says no to a rate cut but it seems the market has other ideas. Today as has been the case for the last week or so:

1. Stocks were under pressure
2. U.S. dollar interest rate futures rallied
3. Short term dollar rates were very bid.

Today though something was a bit different.....EM currencies were under pressure. Led by Turkey,South Africa and Brazil EM currencies gave up considerable ground. With holiday's in the States later this week I see no way the trader will be adding risk to their portfolio's. I think there is real opportunity to be long dollars against just about any EM currency. I have gone long dollars against:


I will add others to the fold tomorrow (I was long dollar's against Mexico and Brazil all day but covered those positions on the close). I am also short Euro's.

I went home short Euro's over the weekend and got stopped out on the move to 1.4685 O/N. I resold today, a smaller position , and will only cover on a move to new highs. Be nimble and do not fall "in love" with any positions right now. These markets are to volatile and momentum changes very quickly.

Good Luck ans Good Forex Trading.

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