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120110 cc final

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  • 1. Wednesday 1 December 2010 www.blackswantrading.comStop and catch your breath; maybe even enjoy a croissant.JR here ... when I read over Jack’s lineyesterday about “wine-sipping and croissant 459 PIPs Profiteating” it made me wonder if I am, in fact, a“big-government socialist.” It also made me Last Week!think of McDonald’s disgustingly delicious See the note from David Newmanbacon, egg and cheese croissant-wich. at the end of this article for more information ...It also elicited a few good responses from ourreaders. Here is one: “I was disappointed to see the reference to “croissant-eating big government socialists.” Surely, you are aware of the Siege of Vienna in 1683, when the Ottoman Turks failed to defeat the Austrians. In celebration, Austrian bakers invented the croissant. Thus, how can you belittle a food that has such a good origin. “Otherwise, your analysis was spot on.”Ah, those were the days ... when Germany would put its support behind its neighbors inAustria. Times have changed. Now German support, despite the official economic andmonetary union, comes via the IMF and EU. But we won’t get into that again – Jacknailed it yesterday.Traders are taking a breather, perhaps enjoying a croissant, and the euro has bouncedsharply today. Overhead resistance at the 72-hour moving average is in play, and isslowing the euro’s climb.EURUSD Hourly:
  • 2. A selling opportunity? Quite possibly. Look at what’s transpired today in the headlines(it’s not good news, so today’s jump seems more like a technical correction – a muchneeded break in the onslaught of selling):S&P says may downgrade Portugal in 3 months (Reuters)Italy no longer quite so safe in euro debt crisis (Reuters)Trichet hints at bond purchase rethink (Financial Times)The Disastrous Consequences of a Return to the Deutsche Mark (Spiegel)Eurozone unemployment edges higher (Financial Times)This from another reader of ours yesterday: “The employment charts made me laugh.”But then again, Portugal’s Prime Minister may have calmed FX traders’ nerves by sayingsuggesting there is no pressure or need for Portugal to seek a bailout.Though that may not really mean much -- here is a priceless piece from Michael Pettis’latest article: Its official – Spain and Portugal will need to be bailed out soon. How do I know? In one of my favorite TV shows, Yes Minister, the all-knowing civil servant Sir Humphrey explains to cabinet minister Jim Hacker that you can never be certain that something will happen until the government denies it. So check out this article in Tuesday’s Financial Times:Black Swan Capital’s Currency Currents is strictly an informational publication and does not provide personalized orindividualized investment or trading advice. Commodity futures and forex trading involves substantial risk of loss and may not besuitable for you. The money you allocate to futures or forex trading should be money that you can afford to lose. Please carefullyread Black Swan’s full disclaimer, which is available at http://www.blackswantrading.com/disclaimer
  • 3. Spanish and Portuguese leaders, with reinforcements from Brussels, are fighting a rearguard action to convince investors that there is no need for further eurozone bail-outs after the €80bn-€90bn ($109bn-$122bn) rescue agreed for Ireland at the weekend. “Absolutely not,” said Elena Salgado, Spanish finance minister, when asked in a radio interview on Monday whether Spain needed help from the European Union. “Spain is doing everything it has promised to do, with tangible results.” Portugal is regarded by bond market investors and economists as next in line for a rescue after the bail-outs of Greece and Ireland. But José Sócrates, Portuguese prime minister, was adamant that there was “no connection” between the Irish rescue and Portugal’s problems. “Portugal doesn’t need anyone’s help and will solve its own problems,” he said, insisting that the country had a clear strategy to cut its yawning budget deficit. Was Sir Humphrey exaggerating? Perhaps, but I do remember that Dublin was pretty adamant just a week or so ago that there would be no restructuring of Irish debt.It doesn’t make sense to believe official commentary can alone stem the eurozone-inspired risk aversion in the markets. But that doesn’t mean the market can’t find somecorrective footing here. After all, the headlines are saturated with commentary of animplosion of the eurozone, the falling value of the euro, Ireland, Portugal, Spain,Germany, etc.Let’s broaden our view to a daily chart – EURUSD Daily:Black Swan Capital’s Currency Currents is strictly an informational publication and does not provide personalized orindividualized investment or trading advice. Commodity futures and forex trading involves substantial risk of loss and may not besuitable for you. The money you allocate to futures or forex trading should be money that you can afford to lose. Please carefullyread Black Swan’s full disclaimer, which is available at http://www.blackswantrading.com/disclaimer
  • 4. There are a couple things going on here suggesting a lasting, long-term move lower:1) The 200-day moving average (purple) has been penetrated.2) The slope of the 50-day moving average (orange) is turning negative.And there are a couple things going on here suggesting a quick, near-term correction isdue:1) The drop beginning on November 22 now makes up 100% of the prior drop (Nov 5 –Nov 17).2) The price has outpaced the 22-day and 50-day moving averages, suggesting that gapmay need to close (correction or consolidation) before further downside commences, assimilarly seen in the two-month period of December 2009 and January 2010 ...EURUSD Daily (Dec 2009 – Jan 2010):Black Swan Capital’s Currency Currents is strictly an informational publication and does not provide personalized orindividualized investment or trading advice. Commodity futures and forex trading involves substantial risk of loss and may not besuitable for you. The money you allocate to futures or forex trading should be money that you can afford to lose. Please carefullyread Black Swan’s full disclaimer, which is available at http://www.blackswantrading.com/disclaimer
  • 5. John Ross Crooks IIIBlack Swan Capital LLCwww.blackswantrading.comWe’re On A Roll, So…Why are Jack & JR leaving money on the table?Answer: Because there’s so much more to come. That’s because ...“Risky Business” is what the markets are saying… and we’re trading that theme to thehilt to ring up profits as we ring in the New Year.Last week we closed out four trades (3 winners, one loser) at an astounding +459 PIPProfit in the space of 5 days.BUT ... Jack and JR still have 2 open positions this week with about 130 PIPs of profit.Why not cash in those trades NOW and break out the 18-year-old scotch?Because Jack and JR believe there is still a lot more money to be made. And it is not toolate for you to get in on the Holiday cheer.Black Swan Capital’s Currency Currents is strictly an informational publication and does not provide personalized orindividualized investment or trading advice. Commodity futures and forex trading involves substantial risk of loss and may not besuitable for you. The money you allocate to futures or forex trading should be money that you can afford to lose. Please carefullyread Black Swan’s full disclaimer, which is available at http://www.blackswantrading.com/disclaimer
  • 6. In fact, if the major moves they’ve meticulously laid out in the daily issues of CurrencyCurrents Professional unfold as foretold, last week’s Vegas-style streak will look likepeanuts compared to what could well happen over the next couple of months.Here’s the question for you: do you want to cash in or miss out… again? If you’re notalready a Pro subscriber, it’s all laid out for you – the trades, the rationale, the bigpicture stuff that makes it possible to anticipate big swings—and bigger profits.You need to get in position now for these major moves. So don’t sit on your hands. Getthe specific trades, analysis, commentary, and charts that will make it possible for youto break out the bubbly (or whatever your beverage of choice) as Black Swansubscribers continue to make money in spite of everything Obama & Company are doingto make good old fashioned capitalism obsolete.Sign up now risk free at Currency Currents Professional.It could be the best decision you make all year.David NewmanDirector of Sales & MarketingP.S. Too busy to trade your own account? Call me at 866-846-2672 for information onour exclusive Managed Money service.P.P.S. A year’s subscription to Currency Currents Pro is one of the most unique andprofitable gifts you could give in this crazy economic environment. Call me (DavidNewman) and we’ll start a subscription for a friend, colleague, or family member andsend them a personal holiday card signed by Jack and JR. You will get a $100 AmericanExpress gift card for every paid subscription you give!Black Swan Capital’s Currency Currents is strictly an informational publication and does not provide personalized orindividualized investment or trading advice. Commodity futures and forex trading involves substantial risk of loss and may not besuitable for you. The money you allocate to futures or forex trading should be money that you can afford to lose. Please carefullyread Black Swan’s full disclaimer, which is available at http://www.blackswantrading.com/disclaimer

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