FX Grail Trades

Looking at the forex charts tonight I see numerous opportunities setting up. There are a few nice Grail set-ups that we will be monitoring. We only trade forex when the charts tell us to. No need to force a currency trade as opportunity comes when it comes. The key to forex trading is patience and a plan. That is it.

We have issued this warning before and will do so again. *Please be careful forex trading during the holidays as there are some quick and violent swings due to lack of liquidity in the forex markets. At the very least make sure you have your stops set.

Dollar Strength

A little bit of greenback strength the last couple days. What do we make of it? Who cares. Trade it as you see it and make the pips. The carry trades have been very kind to The FXGrail as the holidays approach. Will be happy holidays for all Grail traders as the carry trades presented us with some beautiful trades. Like taking candy from a baby!

Very Interesting

As you know we at The FXGrail like to keep your brains thinking all the time. Here is an interesting take on the Bear Stearns free fall. Makes you think doesn't it?

From RollingStone
Oct.14, 2009

Wall Street's Naked Swindle

A scheme to flood the market with counterfeit stocks helped kill Bear Stearns and Lehman Brothers — and the feds have yet to bust the culprits

MATT TAIBBI

On Tuesday, March 11th, 2008, somebody — nobody knows who — made one of the craziest bets Wall Street has ever seen. The mystery figure spent $1.7 million on a series of options, gambling that shares in the venerable investment bank Bear Stearns would lose more than half their value in nine days or less. It was madness — "like buying 1.7 million lottery tickets," according to one financial analyst.

But what's even crazier is that the bet paid.

At the close of business that afternoon, Bear Stearns was trading at $62.97. At that point, whoever made the gamble owned the right to sell huge bundles of Bear stock, at $30 and $25, on or before March 20th. In order for the bet to pay, Bear would have to fall harder and faster than any Wall Street brokerage in history.

The very next day, March 12th, Bear went into free fall. By the end of the week, the firm had lost virtually all of its cash and was clinging to promises of state aid; by the weekend, it was being knocked to its knees by the Fed and the Treasury, and forced at the barrel of a shotgun to sell itself to JPMorgan Chase (which had been given $29 billion in public money to marry its hunchbacked new bride) at the humiliating price of … $2 a share. Whoever bought those options on March 11th woke up on the morning of March 17th having made 159 times his money, or roughly $270 million. This trader was either the luckiest guy in the world, the smartest son of a bitch ever or… Read the rest.........click here.......

A Weak Dollar

We are all aware of the weak dollar. Do we know the ramifications? It is good to know who wants a weak USD and why they want it. Great article in the USA Today. Read it!

http://www.usatoday.com/money/markets/2009-10-12-dollar-earnings-drop_N.htm


Dow closes above 10,000. This is big news as the bears were looking at the less than stellar numbers released in the last few days as a reason for a correction. Looks like the Bulls are going to run a bit longer!

Like What I See

Taking a quick look at the charts and their are a few pairs setting up nicely for Grail trades.  Particularly interested in GBP/USD and AUD/JPY.  Should be a very nice month for The FXGrail.

Forex And You

Why are we successful at forex trading when so many are not? It's easy, we stick with our system. We have a plan and we do not deviate. Sometimes we go days and days without a trade. We want to trade as much as the next guy but we learned our lesson. It was an expensive forex lesson. We have learned the art of trading. We trade when the trades present themselves. Simple.

Do you get a rush out of currency trading? Do you get excited when you "win" a trade? Are you depressed when you "lose" a trade? If so then this business is not for you. Emotion is the root of all forex evil. Every trade we place will either make pips or lose pips. We know that don't we. If the set up is strong as is all of our trades then in the end we will be profitable. No if, ands, or buts, we will be succesful. This is how to make a career in forex. It is not gambling therefore no wins or losses. Just solid Grail trades!

The Week Ahead

Here are some events to look for this week as you prepare your forex trades:

Monday: The Conference Board's index of leading economic indicators is due in the morning. LEI is expected to have risen 0.7% in August after having risen 0.6% in July, according to a consensus of economists surveyed by Briefing.com.

Tuesday: The Federal Housing Finance Agency (FHFA) releases its July home price index after the start of trading. The index is expected to have risen 0.5% after rising 0.5% in June.

The Federal Reserve begins its two-day interest rate policy setting meeting with a decision expected Wednesday afternoon.

Wednesday: Treasury Secretary Timothy Geithner is set to testify before the House Financial Services committee on regulatory reform, starting at around 9:30 a.m. ET.

The Fed is widely expected to hold the fed funds rate, a key short-tem interest rate, at historic lows near zero on Wednesday, with an announcement due at 2:15 p.m. ET. But investors will be more focused on what the bankers say about their "exit strategy" as they seek to wind down programs that pumped trillions into the economy to cushion the blow of the recession.

The weekly crude oil inventories report is also due in the morning.

Thursday: The existing home sales report from the National Association of Realtors (NAR) is due shortly after the start of trading. August sales are expected to have risen to a 5.33 million unit annual rate from a 5.24 million unit rate in July. July sales were up 7.2% from the previous month, the largest monthly gain on record, going back to 1999.

The weekly jobless claims report from the Labor Department is due before the start of trading. 550,000 Americans are expected to have filed new claims for unemployment, versus 545,000 claims the week before. Continuing claims, a measure of people who have received benefits for a year or more, likely fell to 6.188 million from 6.230 million the week before.

Also Thursday, the G-20 summit in Pittsburgh gets underway. The Group of 20 leading developed and emerging countries will discuss the ongoing efforts to stabilize economies after the financial market meltdown.

Bull Market to continue?

Great article on cnn about the stock market and the economy that I thought I would share. These things play a big part in our forex trading business. All news in the financial markets is important news!

NEW YORK (CNNMoney.com) -- With little on the docket to challenge investor optimism, the defiantly bullish stock market is looking to extend its staggering run in the week ahead.

And why not? Wall Street has shaken off pervasive calls for a September selloff and warnings about the still-struggling economy, managing frequent, fresh 2009 highs of late. The Dow Jones industrial average, the S&P 500 index and the Nasdaq composite have all ended higher in 9 of the last 11 sessions.

The petering out of certain government programs in the last two months of the year and the possibility that third-quarter financial reports will disappoint are real concerns -- so is the reality of a still-brutal job market and change in consumer attitudes toward spending versus saving. But these longer-term worries aren't likely to dominate in the week ahead.

"As long as the economic news keeps pointing up, the market is likely to post more gains in the near-term," said Michael Sheldon, chief market strategist at RDM Financial Group.

"However, given the rate of ascent in recent days, investors should be prepared for a pullback before too long," he said. "Anything that could disrupt the positive outlook could spell trouble."

Since bottoming at a 12-year low March 9, the S&P 500 has gained 58% and the Dow has gained 50%. Since bottoming at a six-year low, the Nasdaq has gained 68%.

The advance has been driven by extraordinary amounts of fiscal and monetary stimulus and a growing sense of optimism about the economy.

But that optimism may be misplaced, said Robert Loest, portfolio manager at Integrity Funds, and he said stocks could be in for a bigger selloff a few months out. "I don't think we've seen a rebound of this magnitude following a crash and I'm suspicious."

"This is not the time for investors to be getting into stocks but to be taking profits," he said. "I think this rally can go another five weeks or so, but not three months or six months."

Bernanke

So Mr. Bernanke says it looks like the recession is over. Everybody must rejoice. The forex trading world should rejoice. Just kidding. Big Ben sure likes to state the obvious doesn't he.

The question all forex traders should be pondering is what will the US Fed do with the interest rates? Will they start gradually raising them? Will they leave them alone? Where will the currencies go? The next year or so should be quite interesting to those of you that pay attention to the world feds and how they read and react to the improving economy. Growth in the economies of the world is not going to blow anybody over but we should start to see steady but slow growth. Watch how the feds of the world react to the new world economy. It should be interesting and probably quite comical. Forex traders get ready, should be an interesting next 12 months.

Oil

Oil jumps 3%. Nothing to worry about right? As I have said before the oil bubble was caused by oil traders and not tied to consumption, production, etc. The speculators are back at it again. They see the economy getting a bit stronger so what happens? Oil starts jumping up again. $100+ a barrel here we come again! It's like a vicious cycle. Do I care? No. I trade currency. I trade forex and it doesn't matter if oils up or down, if stocks are up or down or even if the economy is in the tank or flying high. Currencies move every day. The FXGrail trades when it trades and I make more currency. Simple folks!

Recession

Looks like the great recession is drawing to a close. Summer is coming to an end. It is time for us to get back to what we do best-Make Pips! As we have not even looked at a chart in quite sometime (holiday baby!) it will take us a few days to get rolling again. The Forex world has missed us and we have missed it. In the coming days look for us to post a FXGrail trade or two to get everyone back into the flow. While on our sabbatical we ran across something that may interest some of you. Incredible MLB sports handicapping going on at Gold Coin Sports. The Monarch is ridiculous. He picks 1-2 games a day and is up something like 30 units since he started posting his picks. If you gamble on sports this is a must see. See his picks here!

Summer

The dog days of summer are here. It was an uneventful week @ The FXGrail. Typical of the summer months. Throw in the is it or isn't it US economic recovery and you have not much of anything. Sitting back, drinking Margaritas and waiting for the trades to come.

Uneventful Forex

It was an uneventful end to the forex trading week. We at The FXGrail are looking at a couple of scenarios for the beginning of the week. Could be a profitable forex week. Just waiting patiently as the trades make their way to us.



FREE MLB WINNERS FROM THE MONARCH

Patience

The charts are looking quite nice today. I see a few very nice grail trades setting up. To be a success in this business you must be patient. Everybody wants to trade forex, but trading to trade is the quickest way to be not trading forex. Every forex system or set-up requires the same thing to be successful. Patience. Without patience you will fail. Wait for the trade to come to you!

Publish Post

China

So China is rattling their swords again about a new world currency. Nothing to see here folks, move along. Fortunately for the USA the Chinese government has a tremendous amount of US dollars in reserve and a huge amount of our debt. Do you really think that they are going to let the buck become the peso. Nope, will not happen. China needs a decently priced dollar or they will be holding a ton of useless debt.

Nothing more to see!

Lets Roll

Hope all had a wonderful little summer break. Unemployment still sucks, the stock market still sucks, the economy aint rebounding to fast, and Forex still makes me money.

Funny thing how that works. The world goes in the crapper and we still make scratch. Excellent gig, this currency trading thing. Take a look at the EUR/USD, easy range trading since mid may. Very profitable. GBP/USD-same thing. Easy pickings my friends, easy pickings.

On a more somber note it is sad to see Michael Jackson go!

Yeah

It has been a very profitable early summer. Starting after the holiday we will get back to updating this blog on a regular basis. Hope you all enjoy it!

Easy Money!

Simple trading, easy money. It really doesn't get much easier than the EUR/USD and USD/CHF so far this year. EUR/USD has been in a nice range as some may call it for most of the year enabling low risk high reward trades to be executed. Trade the range traders! The USD/CHF has also been giving up some good trades. Where has it gone since the first of the year? Up...UP...UP. With a few brief pullbacks this pair has gone up. The USD/CHF has been text book, enabling The FXGrail traders to make very nice profits. Congrats to all that have been Grail trading these pairs, low risk, high reward, just the way we like it. Discipline and patience pays off....big time!

After digesting the new stimulus bill I have to say I am not a huge fan of it. Common economics say that if you want to stimulate the economy the fastest way is to cut taxes, put the money into the hands of the consumer and they will spend it. Although there is some of this in the new plan, I don't feel it is a big enough chunk. A lot of $$$ is going to save homeowners from foreclosure. Don't get me wrong, I don't want anybody to lose their home but somewhere the individual or individuals have to take responsibility for making the mistake of signing a mortgage they could not afford. We bailed the banks out because they took too much risk, now we bail the homeowner out because he/she took too much risk, yet we (the government) wants all kinds of restrictions on any money given to the big three automakers. I guess I don't quite understand that approach.

Who does the government think is the middle class? I will tell you who made (notice I said made) up a large part of the middle class. The autoworkers and all those tied to the auto industry. Who do you think bought the cars that the big three manufactured? The guys that built the cars, made parts for the cars, etc. Without them this country is going to have a hard time getting nback on track. Seems this is the industry we need to bailout. Is there problems in the auto industry? Yup. Can they be fixed? Yup. Will it help the economy? Manufacturing has been the backbone of this country for over a century. What happens when you tear the spine out of something? It dies....period!

For another day: The wonderful SEC and the scam artists.....Don't get me started.

Stimulus=838 Billion

$838 Billion. That is a chunk of change. Will the stimulus work? It sure will help. After clearing a few key hurdles in Congress it looks like Pres. Obama will get this thing passed. I believe it is a mute point whether you are for or against this massive plan. It has become increasingly apparent that the core of the economy is in danger and something must be done.

There are many good things in this stimulus package and of course, in my opinion, some nonsense. We are of course talking about Congress after all. I tip my hat to them as it does, on the surface, appear that the pork has been kept to a minimum and that's no small feat.

What to look for as a forex trader? You should see the greenback strengthen against the majors, especially on the heels of the Eurozone not cutting rates. Look back over the past year, traders like currencies when their respective governments have enacted policies to stave off this recession. Look at recent history, Bank of England cuts rates, currency jumps, Eurozone doesn't, currency suffers. Look for the same thing this week if the stimulus package gets through the Senate.

Barack Obama

Mr. President. President Obama! I have to say after watching the inauguration of the 44th President of the United States Of America I have a sense of renewed optimism in this country. I believe the new administration will tackle the economic crisis with fervor, I believe the change in foreign policy will be of great benefit to this country. If we can get back to the core values that this country was founded on this country has a chance.

As for the forex market, who took a long dollar position due to the inauguration? We did. No grail trade but a little bet on the optimism that President Obama would bring to the markets. It paid off. We sold two lots EUR/USD @ 1.3300 and closed a bit ago @1.2936. Not a bad little profit.

Enjoy the optimism and happiness and get ready for some Grail trades. There are a few set-ups that are starting to look good.