Some long-term forex ideas.....
Those of you who follow my blog will be aware of some of my spectacularly unsuccessful forex trading forays! Well, all I can say is that all of these experiences contribute to my knowledge of currency trading. I have been looking at some of the forex charts this past week, and some of them have caught my eye:
This is a graph of the Japanese Yen versus the US Dollar. You can see that it has been falling since last summer 2012. There have been a couple of mini-reversals over the past few months, but it is now more definitively above the average for the year. (the green line). I take this as a sign of a possible trend-reversal, and have made a 'long' trade (I have bought). Previously, I have done my currency trading via a spread-bet, but this one I have done differently, by buying an ETF called JPYP. This is a 'synthetic' ETF, produced by ETF Securities, that is designed to reflect the changes in relative value of the two currencies. It is a surprisingly thinly traded product, with only 110 units traded daily over the past 10 days. Whether this has been a prudent trade, only time will tell. I will exit the trade when the weekly price closes below the yearly moving average, either next week , or in a few weeks or months, depending on the markets! I have done two similar trades, one with the Swedish Krona versus the GB Pound (GBSK), and another with the Euro versus the US Dollar (EURP). I'll let you know how these get on in due course!
If the above trading strategy works well, then I may be tempted to use forex trades as a seperate category in addition to my existing categories which are currently: stocks, bonds, property,commodities and gold.
Stocks: Both of my stock graphs are showing the weekly close price to be above the yearly average. The international general investment trust graph has been a bit up and down:
and the smaller UK companies graph is still well and truly above its MA: 
I am not yet invested in these investment trusts, but plan to drip feed purchases in over the next few months, if the BUY signals persist.
Bonds: My bond ETF is still showing a SELL signal, that is to say, its closing price is below the yearly average:
As I suggested in a previous post, bond graphs do not appear to 'trend' very well, and I may be better to simply buy and hold bonds. I do not plan on buying into this investment while it is falling in price.
Property: This has been on a SELL signal, but at the end of trading this week, the price of this ETF had risen back up to the average for the year. So, technically it is neither a sell, nor a buy!
I shall watch and wait and see what happens over the next couple of weeks. I guess that one could say that Christmas and New Year weeks are hardly 'normal' trading weeks.
Commodities: This investment trust is still on a SELL signal, but I suspect that it is now rising from a low back in October.
I shall hold back from going long until the price rises above the average for the year. Will this happen during 2016? I think so!
Gold: I have marked this graph with the 104MA ie, the 2yr weekly MA. This is the trigger that I plan to use to decide when to enter and exit my gold trade.
I plan to use a physically-backed ETF for this trade, with the gold kept in Switzerland!
So that's about it for this week. Next time I am in touch it will be the New Year and there will be new opportunities.
Don't forget: this blog is just about what I am doing, and should not be taken as financial advice. Regard it as 'entertainment' if you will. If in doubt, have a read of my disclaimer!
This is a graph of the Japanese Yen versus the US Dollar. You can see that it has been falling since last summer 2012. There have been a couple of mini-reversals over the past few months, but it is now more definitively above the average for the year. (the green line). I take this as a sign of a possible trend-reversal, and have made a 'long' trade (I have bought). Previously, I have done my currency trading via a spread-bet, but this one I have done differently, by buying an ETF called JPYP. This is a 'synthetic' ETF, produced by ETF Securities, that is designed to reflect the changes in relative value of the two currencies. It is a surprisingly thinly traded product, with only 110 units traded daily over the past 10 days. Whether this has been a prudent trade, only time will tell. I will exit the trade when the weekly price closes below the yearly moving average, either next week , or in a few weeks or months, depending on the markets! I have done two similar trades, one with the Swedish Krona versus the GB Pound (GBSK), and another with the Euro versus the US Dollar (EURP). I'll let you know how these get on in due course!
If the above trading strategy works well, then I may be tempted to use forex trades as a seperate category in addition to my existing categories which are currently: stocks, bonds, property,commodities and gold.
Stocks: Both of my stock graphs are showing the weekly close price to be above the yearly average. The international general investment trust graph has been a bit up and down:
and the smaller UK companies graph is still well and truly above its MA: I am not yet invested in these investment trusts, but plan to drip feed purchases in over the next few months, if the BUY signals persist.
Bonds: My bond ETF is still showing a SELL signal, that is to say, its closing price is below the yearly average:
As I suggested in a previous post, bond graphs do not appear to 'trend' very well, and I may be better to simply buy and hold bonds. I do not plan on buying into this investment while it is falling in price.
Property: This has been on a SELL signal, but at the end of trading this week, the price of this ETF had risen back up to the average for the year. So, technically it is neither a sell, nor a buy!
I shall watch and wait and see what happens over the next couple of weeks. I guess that one could say that Christmas and New Year weeks are hardly 'normal' trading weeks.Commodities: This investment trust is still on a SELL signal, but I suspect that it is now rising from a low back in October.
I shall hold back from going long until the price rises above the average for the year. Will this happen during 2016? I think so!Gold: I have marked this graph with the 104MA ie, the 2yr weekly MA. This is the trigger that I plan to use to decide when to enter and exit my gold trade.
I plan to use a physically-backed ETF for this trade, with the gold kept in Switzerland!So that's about it for this week. Next time I am in touch it will be the New Year and there will be new opportunities.
Don't forget: this blog is just about what I am doing, and should not be taken as financial advice. Regard it as 'entertainment' if you will. If in doubt, have a read of my disclaimer!
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