Today morning When I was back in office, I was up another 9% due to my overnight open position which was again short EUR. I closed the same and opened a long EUR at 1.4629, which turned out to be the worst possible timing as right after my long the euro crashed and I was able to get out of the trade at 4584 which caused a significant loss. that being said, I tried to capture the down move that was on and went short 1000 EUR at average price of about 4669. which I covered at 4554 and opened another short of 1000 EUR at 4539 which I wish to cover at 4477.

My trade book today is as follows

Closed at 307

Has some work and needed to move out so I closed my -150 at 1.46307. I had also initiated another 50,000 short at 365 which I closed at 307

waiting for next trading signal..I believe its sell at below 1.46 and sell at above 1.4672 and a buy if it consolidates and moves sideways for some time and moves up again near 1.4618 levels...it did that but I wasnt around

Currency Trading Adventures

I have started trading EUR:USD pair with equity of 10,000 Euros since 4th of December. On day one I was up 30% and since then had a roller-coaster ride and at one point was down almost 28%

here is the chart of my results



at this point I am up 14% with one open position of Short 150,000 EUR and have decided I will start off keeping a trading log on this blog itself. so now on the blog will act as both, My opinion board and my trading log.

So here goes:

Given the current chart and my open position of Short 150,000 EUR which I entered at average price of 1.47589 I have decided to exit this position at 1.46251.

If this position is closed as planned I will be up 2007 USD after considering all costs.

I am hoping to make this move and then move forward on other trades.

A look at the 10 min chart



My Order book and open position as of this moment

My views are being stolen??

Ok, not really, just a catchy title to the post. But my views on gold have been reaffirmed by none other than Jim Sinclair, chairman at Tanzanian Royalty Exploration (who BTW is one of the most informed individuals when it comes to gold)

"According to Jim Sinclair, chairman at Tanzanian Royalty Exploration, the price of the yellow metal could reach as high as $1650 by the end of 2010 and moving into the beginning of 2011. But, the man admits that, given recent happenings, this could be a bit of a low estimate."

full article on mineweb. http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=93428&sn=Detail

Negative Interest Rates Again!!

Regular readers will recall that I had posted about this unheard of phenomenon in past as well. This time it's "window dressing" by banks that is to be blamed for not only free but actually profitable borrowing by US govt.

From FT:

Short-term US interest rates turned negative on Thursday as banks frantically stockpiled government securities in order to polish their balance sheets for the end of the year.
On Thursday, Treasury bills maturing in January traded below zero per cent, traders said. Three-month bills traded at 1 basis point and six-month bills fell to a record low of 13bp – compared with 14bp at the height of the crisis last year.
Investors looking for some return piled into two-year notes, driving their yield down to 0.68 per cent, a year low

http://www.ft.com/cms/s/0/38f71676-d56a-11de-81ee-00144feabdc0.html

Gold at $800 or $1500 ??

A lot of people have been asking this question of late. I hear that Marc Faber has recently said that gold will move down to US$800 in the short term. However if I look at gold from a 1 yr perspective, I believe gold is headed up all the way to about $1300-1500. the reasons are many but biggest of all is the dual pressure of falling dollar and a move towards reserves other than dollar by most central bankers around the world. a recent IMF paper has this very interesting graph



The fact that US$ share of reserves has been falling can be seen but what is heard now is an indication that not only is the share falling, its falling faster than it did in the past. Recently RBI also bought a large chunk (US$200 bn worth) of gold to replace the dollar reserve. And increasingly all the national reserves that are loosing dollars and searching for alternatives, will find it in precious metals (mostly gold).

Hence I am a big bull on Gold

One of the best songs

I usually don't analyze music as I believe there are some things that should simply be enjoyed. but given how much I like this song I couldn't help but ask why do I like this one so much?

The song I am talking about is 'Aj din Chadeya' in the movie 'love aajkal'. This song, I have realized, is liked so much by me because it is a perfect package of everything.

The rhythm is undoubtedly amazing, hats off to Pritam Chakraborty, but it is complemented perfectly by the really soothing voice of Rahat Fateh Ali Khan and the really touching lyrics by Irshad Kamil.

So you see, this song is an amazing blend of perfectly complementing music, lyrics and voice. All three are individually enough to make a very good song on their own and they have come together in this song. No wonder I am such a big fan of this.

Be careful, your bank statement may not be correct

It was recently reported by Wired that a new technique employed by cyber criminals actually changes your bank statement to hide the fraudulent transfers from your bank account, this means that potentially you may be out of money for long enough and not know about it if you rely solely on your online statement and dont transact too much

link: http://www.wired.com/threatlevel/2009/09/rogue-bank-statements

This is the most troubling article I have read this weekend.

Every regulator should read this

http://generationbubble.com/2009/10/03/dupe-deluxe-the-suckers-market-for-financial-innovation/

Unless regulators play a role in this game, the outcome as defined cannot be changed

CRISIL Concall:-

Ok, I got in late but had the opportunity to hear the Q&A round.... so here goes

after a little bit of ada..beep..ada..boop.. Tarun says Crisil is now more confident that govt. will infulse cash into PSU banks if need be so they are now more comfortable with the banks. and hence upgrades eight public sector banks. UBI and BOI are now AAA for Tier I, Hybrid and lower Tier II bonds. I guess the market would have (or atleast should have) thaken this into account quite some time back.

As Aside: S&P did something amazing and unbelievable

From Blooomberg:
Standard & Poor’s backtracked on ratings cuts issued last week and raised the ranking on commercial mortgage-backed debt from three bonds sold in 2007.

The securities, restored to top-ranked status, had been downgraded as recently as last week, making them ineligible for the Federal Reserve’s Term Asset-Backed Securities Loan Facility to jumpstart lending.

S&P lowered the ratings on a class of a commercial mortgage-backed bond offering from AAA to BBB-, the lowest investment-grade ranking, on July 14. The New York-based rating company reversed the cut today, S&P said in a statement. In a related report, S&P said it adjusted assumptions on the timing of projected losses on the mortgages.

“It is a stunning reversal and certainly raises questions concerning the robustness of their revised model,” said Christopher Sullivan, chief investment officer at United Nations Federal Credit Union in New York. “It may engender further uncertainty with respect to ratings outlooks.”