Nikkei broke the proverbial 9000 level in tandem with the US Dollar Yen (USD/JPY) cross rates breaking the 84.810 level. At 84.35 Yen is racing towards the 79.780 level with gusto. The heuristic is that USDJPY will hold at the 79.780 level (Last touched in 1995) and this will coincide with the Nikkei at the 8480 level. Having abandoned Nikkei longs with break below 9000, I am betting on heuristic that forex will provide meta indicator for next move upwards for Nikkei. Placed very large limit buy orders for USD/JPY at the (79.800 – 80.000) level.
By Andrew Shawn – Recursive Investments in Global Financial Markets
The movement of the Bund based on hermeneutics would indicate a crash is eminent. Although I am short Equity markets through puts and outright shorts on Mexico IPC, SPI (With the exception of the Nikkei where I buy everytime we test the 9000 level) there is another heuristic coming to mind. What if China is causing a bifurcation in these markets. China could be seriously buying up the Bund, negativing its indication of a market crash. Put options and tight stops allow me to continue betting on Equities dropping. The movement of the VIX gives such a position further currency. An increase in NAV’s could give me further conviction.
By Andrew Shawn – Recursive Investments in Global Financial Markets
I have been active heavily on the Forex side of Markets. GBP/NZD replicates movements of Equities with almost a 1:1 correlation. Likewise AUDJPY has been prescient. My biggest bet is on a rallying dollar and Pound. There is something in the air on the US Dollar. Could talk of the Israeli / Iran issue be moving forex markets.
By Andrew Shawn – Recursive Investments in Global Financial Markets
F.T Quote: “Hedge fund managers have piled into the US government bond market this year in an attempt to profit from growing volatility and pricing inefficiencies arising from the US Federal Reserve’s unorthodox monetary policies. Hedge fund managers now account for one-fifth of all trading volume in the $10,000bn US Treasury bond market, up from just 3 per cent in 2009, according to a comprehensive investor survey by consultancy Greenwich Associates”
Signs of herding are growing louder by day. On a reversal we could see an excessive drop. For now however those treasuries are pointing upward. However I know have screen up showing the charts every tick.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Markets have seen me trading around the clock, carrying some of my largest positions to date. Longs on the US Dollar produced very expedient returns for my NAV. I sold out EUR/CHF at 1.3740 as it broke upward trend. It has proceeded to trade below the 1.3500. Put options on DAX that I considered a lottery play brought in positive returns. Went short my instruments of choice (IPC and SPI 200 (Australia)). It appears they listened because they have been giving up the ghost accelerating lower.
Corn:
I prematurely dismissed fractal of Corn futures. It continues to hold. Bought out of the money dec corn puts at the 400.00 level as I anticipate Corn dropping down to the 380.00 level before another move.
Nassim Taleb:
I have been fascinated with Nassim Taleb’s thinking and always found his books of great insight. He commented a while back that shorting US Treasuries was a no brainer. I have kept looking out for technicals that would point to a reversal of US treasuries but see nothing but bullish trends. Lately however the FT had an article that showed Hedge Fund buying of US treasuries had grown to a 1/3 third. This shows the herd mentality and crowding. I have began in earnest looking at them really closely for any signs. Might turn out to be the trade of the decade when they rush for the exit.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Kept pyramiding long position on Forex trades. Carrying largest position money management can allow. (Heavily long US Dollar Index, USD/SGD and EUR/CHF). If USDX crosses 81.23 will double position again.
- Crude: A soaring dollar will be negative to Crude oil futures.
- USD/JPY: Key levels on Yen of at 85.00 appear to have held. If Dollar can rally past the 87.00 level it would bode well for the Nikkei. Would then be buying Nikkei (Movement today, is moment of truth)
By Andrew Shawn – Recursive Investments in Global Financial Markets
Will be accumulating US Dollar Index futures as I bet on rebound of US Dollar. Any trade above 81.230 will have me pyramiding long position
By Andrew Shawn – Recursive Investments in Global Financial Markets
DAX gives key reversal signal selling off to 6264 putting my strike price puts of 6300 in the MONEY. Further Bund Futures hit 130.00 !!! Dow confirms by selling off with a key reversal as well. SPI 200 futures selll off. o.k Kept selling short with technicals stops set at previous highs set by these indices. Will increase depending upon how these markets close. Should they confirm key reversal days, I will be selling heavily on Monday. If they fail to confirm key reversals will remain on sidelines.
US Dollar Index hits 85.32, looking to start buying at the 85.200 level
By Andrew Shawn – Recursive Investments in Global Financial Markets
My trades of late have become too fixated on the short term causing me to use too tight stop positions that get me out of trades. Most of the stops have violated the daily volatility of the derivatives I have been trading giving a high probability that I will get stopped out even as a trend is forming. Not happy with current returns at all. At such times It has been to my advantage to get out of all positions and then look at them from a fresh set of eyes. Like a chess board, you see moves better when not in the middle of a move. The only positions I will leave on are those out of money puts. I consider them, simply lottery tickets or insurance.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Corn futures factal broke with Corn trading past the 425 level, forcing me to reverse and go long.
The drastic movement of Corn futures past the 420 level all the way to 438 and then back down to 415 had me reverse my shorts at 425 go long only to get stopped out again at 425.0 as it broke back lower to 415. On the sidelines watching to see if pattern still conforms or considering heuristic as void.
By Andrew Shawn – Recursive Investments in Global Financial Markets
Financial Markets | RefCapGroup | 
August 24, 2010 (2 weeks ago) 1:21 am | 
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