Covered my Bund short position as technical analysis leads me to the conclusion we are on the tale end of an exhaustive rally. Began buying out of the money puts on Equities towards the end of today’s closing day. These markets are rallying and the Nikkei seems to think it is part of the herd. One sunshine does not make a summer, neither one rally a bull market.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Jordan Kellner often said ”50% of life is luck, the other 50 is mazel. I would rather be lucky than right”. Having got caught yesterday and lamenting at the slow sell off the Bund futures, I doubled down my shorts on them and doubled my longs on Dow futures and Swiss Market Index. I had actually planned to close these longs yesterday at the market close, then because of the upcoming Labor day weekend, as markets tend to rally around holidays I decided at the last minute to hold them. Well Bunds have dropped fruther down to 131.50, Dow Futures which I bought at average fills of 10100 are at 10430, and Swiss Market Index touched 6430. I have more than dug myself out of the hole in a single trading day! Tightened stop positions.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Bund shorts helped limit the damage over night. Bunds continue selling off down to 132.71 and profits from shorts are helping to mitigate the damage from the draw down I took yesterday.
I got hit on the Forex markets as dollar gave up the ghost, while GBP.NZD also sold off, USD.SGD. Reduced positions on all fronts and have to dig myself out of a hole again. What it shows is my positions were too correlated. I was short significantly on the IPC and the SPI. These move in tandem and inversely to US Dollar. Hence Having positions on all three of these was tantamount to carrying and over leveraged single position.
By Andrew Shawn – Recursive Investments in Global Financial Markets
My Hedge of shorting the Bunds was not as expedient as hoped. Bund only dropped by 100 from 134.50 down the 133.28, however during this movement IPC Mexico rallied from lows of 31300 to 32400 whipping away large chunk of profits and forcing me to cover my large shorts at a loss. I had reduced my shorts significantly going into the 1st of the month but had left IPC Mexico short position on as I figured it would be dead cat bounce having rallied 400 points the day before. BIG MISTAKE.
I bought Dow futures at 10100, Swiss Market Index futures at 6265 average fills. Movement of Bovespa seems to point to Equities rallying in this fourth quarter.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Went from just out of the money puts on Bunds to outright selling Bund futures short as short term trend develops. At 133.68 points to a further rally in Equities today
By Andrew Shawn – Recursive Investments in Global Financial Markets
JGB Futures touched 14308 less than 200 points away from proverbial 14500 level. Likewise YEN soared against US Dollar to 84.125 ( Over 400 pips from 79.750) with Nikkei dropping to 8780. We are closely approaching the moment of truth.
Sold out my in the money put options on DAX futures. Bought out of the money puts on Bund futures. I am weary being heavily short on the 1st day of the month. Markets have a tendency to rally. Puts on Bunds provide a hedge to my short exposure.
Patience: I consider the iteration of JGB Futures, Nikkei Futures and USD/JPY cross rates to providing the opportunity of a lifetime. Patience As the warriors would say, hold, hold, hold. Wait for the signal. We are close but not there yet
By Andrew Shawn – Recursive Investments in Global Financial Markets
Bund
Began accumulating out of the money put options on December Bund futures.
Corn:
Error I made in trading corn futures brings to mind a quote by Gregory Bateson. “The Fallacy of misplaced concreteness !!” Here I was having been long corn and accumulated a handsome profit, going against the trend with the heuristic of an iterated pattern. Although Pattern was clearly violated with the D’ breaking the B’ I continued holding on to hope for a retracement. Movement of corn futures on Friday (Shooting past previous temporary highs to 442), brings new perspective. A move past 450.00 should make me go long and become a large buyer
By Andrew Shawn – Recursive Investments in Global Financial Markets
Bund September futures exhibiting French curves at 134.35 (having touched highs today of 134.54), anything above 134.76 will have me buying out of the money puts on Bunds.
JGB Futures / USDJPY / NIKKEI
The major threes in determining movement next Japan wave.
- JGB futures at 143.03 are 200 points away from 145.00.
- USD/JPY at 84.72 (having touched lows of 84.250) still 400 pips away from proverbial 80.00 level
- Nikkei crossings still no signs of bottom , without the above two.
My biggest bet when above iterate and hit the confirmed points would be to take on Massive shorts on JGB’s, longs on USD/JPY and longs on NIKKEI.
SHORTS:
Continue holding large shorts on Mexico IPC, NIFTY 50 (India) SGX, SPI 200. (Bovespa shows no bottom yet)
FOREX:
US Dollar Index rally appears to have stalled at the 83.00 level. Tightened my stop positions. Expected larger rally from USDSGD but it hasn’t produced expected movement.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Began selling Bund short at 134.15 with stops at 134.30 (just three ticks from previous highs of 134.26)
14:36 Update:
Wow Bund futures short past the 134.26, triggering my stops with fills at 134.31. Bunds now trading at 134.70 !!! Looks like markets are going to crash
17.04 Update
Bund continues to touch 134.20. For a market reversal I need it trading below 133.50 for a positive signal.
19:55
Bund futures show no valid signals, however VIX continues to point to interesting times. Remained short Equity Markets
By Andrew Shawn – Recursive Investments in Global Financial Markets
JAPAN
I continue looking at the Japan position as a trade of a lifetime with a convolution of all three instruments. JGB and USDJPY providing the meta signals for Nikkei
- Currency: USD/JPY cross rates touching 79.800 level
- Nikkei dropping to the 8500 level
- JGB Futures completing mirror image formation
Mirror heuristic shows Point F and F"
Cross rates target 79.80
Purchase target value vague and dependent on above two metasignals
EUROPE:
Movement of Bund is showing hints of an end to rally which looks positive for the Equity Market. Having hit 134.260 it closed at 133.90 opening today at 133.75. Reversals of the Bund have an uncanny way of predicting rallies in Equities. Covered short term puts on the DAX.
GENERAL TRADES
Continue holding out of the money puts on December corn futures as fractal has not been negated. Short position on IPC and SPI 200 have provided excellent numbers for NAV. I did however miss out on the MSCI Taiwan Index futures as I covered at the 280.00 level only to see them drop in the last two days to 270.60.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Financial Markets | RefCapGroup | 
Yesterday 7:05 am | 
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