The collision of global markets and social mood

Friday, April 8, 2011

Back At The Top Of The Range

Futures have climbed back to the top of the range. We'll likely have another gap open unless they correct between now and the open.

I view this to be constructive, and it has me looking for continuation over the next few days, possibly in a thrust higher. If the market was ready to head down, yesterday was the ideal day. It didn't happen.

I was trading the 6C against the USDCAD again when the aftershock hit Japan. I had just hedged the USDCAD with a long position on 6C and even added to it as it retraced. Suddenly there was no bounce. It was just straight down, and taking me with it.

The news about the aftershock came out and the market stabilized then bounced. Luckily what could have been a huge loss turned into a near-even loss -$20 on the whole position. I went flat and reassessed.

This morning, risk is back on as the US dollar has broken down, USDCAD is in a lower buy zone near .95200, while 6C has rocketed higher. My plan is the same. Add more and hedge. 6C is helping create a cushion for my speculation that USDCAD is near a significant low.

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