Saddam captured = $ strength?

[MISH]

I am going short on the EURO. My data shows the Euro against the USD in a sharp downward trend. This was the news I was looking for! Its very interesting the news and capture came out on the weekend...
Happy trading all


Mish

[peteuk]

Originally posted by jasonjm
I was also thinking between usd/chf and eur/usd

the reason I went with usd/chf long is:

1) USDCHF is the safe haven play, on political news it moves the most out of any currency
2) USDCHF has a negative interest yield, less incentive for big 1:1 players to hold onto longs, whereas eur/usd is positive


anyone feel free to comment on their reasons or whats wrong with my logic!

I go with that, a lot of players hold CHF in uncertain times, looks like (in the short-term anyway) the dollar will come back into favour and shorts will be squared.

Maybe for the coming week and next week, very little data from the US, this news will be the main event and is undoubtedly dollar positive before the Christmas holiday. Then with a stock market rally as well we might be hearing noises about interest rate rises from the Fed in the New Year........all good $ stuff and not a time to be short

Pete

[bearprofits]

What's the Dollar going to do on it's current elevator ride? Good news for the Dollar on the capture of Saddam, Going Up? Whoa!!! My opinion, current administration likes a cheap Dollar, no need for tariffs, all in a sudden US exports cheap on the world market, Going Down? Whoa!!!! EU can't come together on new constitution, Going Up? Talks of EU intervention against Dollar. Uncle Alan OK with Dollar's slide.......

Watch out Come Monday Morning, think the best play is no play for now.

Just a Newbee's thoughts

[blanca]

Go long usdchf in asian session, nice to hear saddam was finally captured, regards.

[Mizzer]

Originally posted by bearprofits
What's the Dollar going to do on it's current elevator ride? Good news for the Dollar on the capture of Saddam, Going Up? Whoa!!! My opinion, current administration likes a cheap Dollar, no need for tariffs, all in a sudden US exports cheap on the world market, Going Down? Whoa!!!! EU can't come together on new constitution, Going Up? Talks of EU intervention against Dollar. Uncle Alan OK with Dollar's slide.......

Watch out Come Monday Morning, think the best play is no play for now.

Just a Newbee's thoughts

I agree, Saddam is still but a small part in a big world picture...the asian open has already provided huge gaps with most pairs, while obviously positive initially for the dollar, it hasnt changed a lot of other fundemental problems. Im waiting it out and will just enter when my system indicates a secure trade, up or down.

[GeoffreyTransom]

I agree too, Mizzer. The capture of a second-rate CIA-implanted dictator is not going to change the US' massive external imbalances, nor will it slow the rate at which Greenspan is printing USD. Nor will it slow the runaway government spending (one half of the reason for the US having an unprecedented string of budget deficits - the other half being the "target the GOP donors" tax cuts). Federal spending now approaches 30% of GDP (and the US claims to be even remotely interested in free markets!!). The USD is weak because of economic mismanagement of the public sector and irresponsible monetary policy, not because of Saddam Hussein.


This downward blip - which will be the countersign of an upward blip in equities and a downtick in bonds - will just enable smart money to re-short both US equities and the USD at higher levels. And of course Gold has been smacked a little overnight - "real" things will suffer for the next session or two, while "fiat" things will go for a little bit of a romp... however with the VIX at its lowest level IN HISTORY, this is one of the best times to think about shorting US equities...

[eternalfuture]

I must agree that the capture of Saddam did led to USD rally.
However, if you take a good look at the charts, it's gapping more than 50 pips on EUR/USD. And the duration of the price below 1.2200 was not even pretty long enough.

Another argument is that USD woes lately has not been primarily attributed to Saddam. The major problem is the twin deficits and souring sentiment. True. Right now the USD is basking a bit on the sunshine. But, when the market discount all of the Saddam's news, it's all over for the USD rally.

Even after the capture of Saddam, 2 car bombs exploded in Baghdad. This means that the insurgences in Iraq is not solely caused by Saddam.

I will look very cautiously as the situation develops. Eur/USD still has room to rally later.

Good Luck, Good Trade.

[GeoffreyTransom]

Originally posted by GeoffreyTransom
This downward blip - which will be the countersign of an upward blip in equities and a downtick in bonds - will just enable smart money to re-short both US equities and the USD at higher levels. And of course Gold has been smacked a little overnight - "real" things will suffer for the next session or two, while "fiat" things will go for a little bit of a romp... however with the VIX at its lowest level IN HISTORY, this is one of the best times to think about shorting US equities...

There... now that wasn't too hard, was it? AUD new high today, GBP new high today, EUR new high today. If the Dow closes RED after this, with every news media organ pumping out "Saddam Capture to Boost Stocks, Dollar" drivel, then we are in for a new leg down in equities and a new bout of USD weakness.

Find out which direction the mindless herd is likely to run, and bet against it.


That's the reason that herd animals tend to be eaten by "small pack" animals and solitary predators. After all, if lions ran in prides of 20,000 there would not be enough antelope around to feed more than a few packs.

Of course in financial markets it helps to let the herd get up a bit of a head of steam so that insiders can maximise the amount of fat they can get off the herd's carcass. I don't remember who said it (I think it was Marc "Doktor Doom" Faber) but it stands to reaon that the market MUST NOT EXIST TO MAKE EVERYBODY RICH... it is a machine for re-concentrating wealth which has dribbled away from the insiders!