Thursday, August 19, 2010

8/19 Forex

  • USD/JPY shows bear phase; blasts through lower pivot.

ppspps openupper pivotlower pivot
EUR/USD US$1.29 US$1.32 aug11 US$1.34 US$1.25
USD/JPY¥84.92 ¥85.44 aug19 ¥88.41 ¥83.96
GBP/USD US$1.56 US$1.59 aug11 US$1.60 US$1.51
EUR/JPY ¥109.34 ¥113.50 aug10 ¥115.86 ¥108.62
USD/CAD C$1.04 C$1.04 aug17 C$1.06 C$1.01
USD/MXN M$12.68 M$12.66 aug17 M$13.00 M$12.24

Any time the yen strengthens against the dollar, the Japanese press puts up the big headlines about "En-daka" -- the high yen, with dire predictions about the demise of Japan's export-driven economy.

But "En-daka" isn't new news.

The yen has been stairstepping downward since 1998. The top of the most recent step was inn June 2007, and since then the yen has lost 32%. So a bear phase on the dollar against the yen is just the status quo.

Today's signal comes after a four-day bull whipsaw that brought the price down 0.5% -- some bull phase!

The price pushed through the first monthly lower pivot, at ¥85.20. The next pivot is at ¥83.96.

Reuters with a touch of stupidity headlines the move as the yen dipping against the dollar about the chance of a Bank of Japan stimulus package. But that's not right.

A currency pair tracks the first currency in term so of the second currency. So, USD/JPY is dollars in term of yen -- how many yen does it take to buy a dollar?

Back in early June it took ¥92.88 to buy a dollar. Today (now) it takes ¥84.98 to buy a dollar. Fewer yen to buy a dollar means the price of a dollar is cheaper.

Ergo, the dollar fell against the yen or the yen rose against the dollar.

Are you listening, Reuters???

The analysis uses the daily Person's Proprietary Signal, developed by John Person, and the monthly Person's Pivot, which he also developed.

These are black box signals -- the "proprietary" means that Mr. Person knows how they work under the hood, and I don't. But they have shown a fair degree of success in identifying good entry and exit points, and I find them useful.

On the glance, "pps open" means the price at the start of trading in the United States on the day the signal appeared.

Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

No comments:

Post a Comment