How do those big Chinese institutions deal with the Euro/USD trade?
First, through currency exchange trading just as our group does.
Secondly, there are lots of RMB in Europe so there needs to be a buffer to keep the value of RMB vs. Euro constant just as in the US dollar traded equities, e.g. OIL as everyone can see today from the rise in oil exactly consistent with the decline in the US$.
But how do US equities and dollar-traded commodities rise from the Euro rise at the exact same rate?
Because institutions, super-computer-assisted, can use a rise in the Euro/US$ to effectively "repatriate" the US$ they have risked in the Euro Zone. The Euro can be directly sold at a relatively high price that produces more US$ because of the exchange ratio - or - through the use of derivatives like puts, calls, futures, etc. And the US$ need to go somewhere immediately (in a nanosecond or so) and they go into US equities. There is no place else today.
Could there be any other reason for BAC day-trading to exactly copy semi trading?? Probably not. Banks and semiconductors, no real relation except the algorithms.
None of us believe what CNBC is paid to tell us, right?
Thursday, October 27, 2011
When to Short Euro/USD = NASDAQ and SP?
As we said, the next trading day in the US may be a good time; however, do not forget these facts:
1. No one wants the Euro/US$ to super-crash on a Friday, that's why 'good' news has been abundant once again leading into a Friday.
2. But no self-respecting European would in fact be working on Friday, especially having to work a couple days previously in the week.
3. End of day? Nothing. Trade later. Often, the best trade is no trade at all. Just watch the supercoms do their low volume Friday work. The programmers are off.
1. No one wants the Euro/US$ to super-crash on a Friday, that's why 'good' news has been abundant once again leading into a Friday.
2. But no self-respecting European would in fact be working on Friday, especially having to work a couple days previously in the week.
3. End of day? Nothing. Trade later. Often, the best trade is no trade at all. Just watch the supercoms do their low volume Friday work. The programmers are off.
Super Euro/US$ News Last Night - NASDAQ to be Shorted?
Super announcement.
The good news:
Major European banks will only lose 50% (half) of their investments in 'Grease' !! Stupendously terrific!
Because of the continuous algorithms on the super-computers, the US equities markets kept exact nanosecond pace with the Euro/US value as usual! (Don't forget, currency is traded with a 50:1++ leverage. You are smart folks, so you can work out the % math for yourse... well, you know.)
The bad news? Well:
Those banks will need to raise about 25% of the assets they just lost by sometime next summer... oh oh. You may want to "withdraw" from your account.
The American banks are already reviewing their losses-du-jour but don't have to tell you until later.
Oh yeah, the 4T "euros" to bail out the rest of So. Europe? Don't worry, lots of private investors simply cannot wait to get into that deal!! ha ha ha ha ha ha ha!
The good news:
Major European banks will only lose 50% (half) of their investments in 'Grease' !! Stupendously terrific!
Because of the continuous algorithms on the super-computers, the US equities markets kept exact nanosecond pace with the Euro/US value as usual! (Don't forget, currency is traded with a 50:1++ leverage. You are smart folks, so you can work out the % math for yourse... well, you know.)
The bad news? Well:
Those banks will need to raise about 25% of the assets they just lost by sometime next summer... oh oh. You may want to "withdraw" from your account.
The American banks are already reviewing their losses-du-jour but don't have to tell you until later.
Oh yeah, the 4T "euros" to bail out the rest of So. Europe? Don't worry, lots of private investors simply cannot wait to get into that deal!! ha ha ha ha ha ha ha!
Prediction for Asia Euro/US Trading Overnight
Since some technical lines are coming together, we expect no currency move overnight.
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