Institutional Technical Analysis

Libero wrote: Folks,

Some interesting T/A from Credit Suisse on the following Forex Pairs for today:

1. EUR/USD

2. USD/JPY

3. GBP/USD

4. USD/CHF

5. AUD/USD

6. NZD/USD

7. EUR/JPY

8. EUR/GBP

Not sure if members here feel that I've over done it with materials from the big banks. Let me know if it's all too much!

Definitely not 'too much' Libero. Keep 'em coming: whether you agree or disagree with their conclusions is not important - to know how they're thinking is the important bit
Good on ya mate!

Folks,

Further T/A from the following:

1. CommerzBank (Bullion) - Their take on gold is bearish.

2. UBS Metals - There are no charts, but there is technical commentary. There outlook on Gold is bullish.

3. Credit Suisse's top five trades (a good, if slightly longish read with T/A starting on page :

a. Number One: Short The “Little Aussie Battler”

b. Number Two: Short Yen

c. Number Three: Buy the KRW

d. Number Four: Fade The ZAR Rebound

e. Number Five: Short EURUSD – Riding The Range


4. Standard and Chartered's F/X Strategy


EUR-USD
We remain bearish on EUR-USD as technical indicators argue the
recent rebound is likely to reverse.

USD-JPY
We remain neutral on USD-JPY and expect sideways consolidation
to continue in the near term.

AUD-USD
We turn bearish on AUD-USD as we expect negative momentum to
resume.

USD-SGD
We remain neutral on USD-SGD, though a minor consolidation
could temporarily correct prices lower.

GBP-USD
We remain bearish on GBP-USD as technical indicators argue
further weakness is in the offing.

XAU-USD
We remain bearish on gold as the medium term trend remains to
the downside. The recent rebound is likely to be temporary.

.............

Massive day, so good luck folks!

Hi Libero,

I'd appreciate a translation of this if you could.....

 Buy AUDUSD 3m RKI 1x2x1 put butterfly struck 0.86 – 0.83 – 0.80, where the 0.83
strike puts the investor sells knock in only if 0.80 is touched. The structure is
indicatively offered for 0.5% (spot ref 0.9050), close to a 40% saving to the vanilla
0.86 – 0.80 put spread.

Cheers,

Diver

Options Language. Dont have a clue what it means

diver993 wrote: Hi Libero,

I'd appreciate a translation of this if you could.....

 Buy AUDUSD 3m RKI 1x2x1 put butterfly struck 0.86 – 0.83 – 0.80, where the 0.83
strike puts the investor sells knock in only if 0.80 is touched. The structure is
indicatively offered for 0.5% (spot ref 0.9050), close to a 40% saving to the vanilla
0.86 – 0.80 put spread.

Cheers,

Diver

Cricky Diver!

You're not asking for much are you!

R/C is of course correct. This is Options speak.

*AND* this trade isn't for everyone either (aimed without any disrespect).

I'm not going to go through the trade, but I'll try to explain some terminology if it helps any.


A Butterfly (no, not that kind of butterfly!), is a non-directional strategy used by options traders when the underlying volatilty < the implied (i.e. a future looking view, rather historical, against historical inputs, through pricing models such as Black-Scholes which is popular); and this usually (i.e. a good chance but not always) yields an artibtrage trade.

I never said this was easy!

Vanilla is more straight forward, and in this context, it is the most basic 'version' of an option; i.e. a 'normal' put / call with no fancy (i.e. exotic) features.

The above trade is suggestive of a non-vanilla options put, where the probability of a successful trade is higher, perhaps implied by a narrower spread when dealing with an exotic vs vanilla options variant.

If you don't have knowledge of options or mathematical models (such the monte-carlo method, or black-scholes), I'd stay well away from this stuff - unless you have an interest, in which case, try to get hold of a copy of John Hull's seminal book on options, furtures first.

Disclaimer: I'm not advocating trading options or any other trade for that. I think I have to add DYOR as per Remo, because this stuff can lose you not just your shirt, but your soul too!

Maybe in the future CV will host other derivatives to trades, but for now, there's enough risk with conventional T/A!

HI Libero - please can you re attach the latest equity market TA update? I tried opening a few attached files but they all relate to metals or FX...

cheers matey