Saturday, 9 August 2008

Currency Update

At last! The strength in the US dollar that I have been waiting for has begun. This is the beginning of a major move, that will last for some considerable time. It has already impacted sharply on the major and minor currencies around the world.

I am long 3m USD (see previous posts!) against the euro at an average of 1.5160, which has at last moved into profit, with this pair closing this morning at 1.5000.

I was long 1m USD against the yen at 106.30 and added another USD1m on the break above 108.50 at 108.70 this week. So am now long USD2m at an average of 107.50, with this pair closing this morning at 110.20.

Gains to date actually banked are NZD369,000.

Looking to buy NZD and sell AUD1m on open on Monday, as this cross is moving higher, with a target of 0.8500 in the next few months.


Russ said...

Mate, not sure if I prefer your trades or your blondes, both not too shabby
What's your thoughts on NZDJPY? Quite a bit of press on record long NZDJPY positions by Japanese traders.. reckon if uridashi buyers start switching to Brazilian & SA bands this cross is gonna get smacked..

Kiwi Trader said...

I quit my long NZD short JPY position at 87.30 and 85.00, back in February, see earlier comments under trading. Took about NZD110,000 out of the trade, so a good trade.

Right now, the Yen itself is not really weakening against the USD much, whilst the NZD/USD is dropping, result is the NZD/JPY has dropped into the 77 region.

On balance this cross goes lower, but probably not too much more, as the interest differential is still so good. Given the fall in the NZD, Bollard has an issue lowering interest rates much more, so this cross may find a base around 75.00.

Still like being long this cross, as the carry trade works so well, but need to see it stop falling for a while befoere I take a hand again.