Weaker Dollar Coming Now?

On March 29 I posted an entry titled “Stronger Dollar Coming?” suggesting that the Dollar would gain strength as the consumer spending lessened. At the time the Eur$ was at 1.3440 and it did reach a low of 1.1875.

Today with the Eur$ in the 1.2660 area I see reason to believe that the reversal has begun with the information that follows in this posting.

As you are probably aware the Federal Reserve has a new program called Quantitative Easing, whereby the Fed purchases the securities of the government by printing money. Now that the mideast and fareast countries are no longer buying our securities as before, we are now buying our own.

The article referenced below is a must read for those of us who trade the Forex. The author makes a strong case for a weaker dollar. What this means to me is that the bias that occurs when the market drifts between major announcements will be in the direction of a weaker dollar. I will also trade any technical indicator in that direction even if the technicals are weaker than I would like.

Here is a quote from the article. “this second round of quantitative easing appears likely to continue. Unfortunately, the unintended side effect of this policy shift is likely to be an abrupt collapse in the foreign exchange value of the U.S. dollar.”

Here is the link for the full article http://www.hussmanfunds.com/wmc/wmc100823.htm

Elimination of OTC Forex?

Now that this bill is law, I bet the brokers are going nuts today. The blogs are going crazy with this news. You can be sure that the CFTC will get a ton of complaints from the brokers. I cannot imagine that the retail Forex market will be shut down for the retail trader who has no Series 3 or 34 license. But here is the most popular blog content on the Internet today.

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Effective 90 days from its inception, the Dodd-Frank Act bans most retail OTC forex transactions. Section 742(c) of the Act states as follows:

“…A person [which includes companies] shall not offer to, or enter into with, a person that is not an eligible contract participant, any agreement, contract, or transaction in foreign currency except pursuant to a rule or regulation of a Federal regulatory agency allowing the agreement, contract, or transaction under such terms and conditions as the Federal regulatory agency shall prescribe…”

This provision will not come into effect, however, if the CFTC or another eligible federal body issues guidelines relating to the regulation of foreign currency within 90 days of its enactment. Registrants and the public are currently being encouraged by the CFTC to provide insight into how the Act should be enforced. See CFTC Rulemakings regarding OTC Derivatives located at the following website address, under Section XX – Foreign Currency (Retail Off Exchange). As this provision is potentially devastating to the forex industry, affected readers are encouraged to voice their opinions to the CFTC directly. To do so commentary should be forwarded to via email to:

Secretary@cftc.gov
Attn: David A. Stawick, Secretary
Commodity Futures Trading Commission
Three Lafayette Center
1155 21st Street, NW
Washington, DC 20581

More Euro Instability Due This Week

Today’s Financial Times reports that “Banks across the eurozone, but in Spain in particular, have found it hard in recent weeks to secure liquid funding in the commercial markets, with inter-bank funding virtually non-existent.”

Effective tomorrow the ECB will no longer give 12 month loans to Spain, but will only give 90 day loans.  International capital markets are now closed to most spanish banks and businesses. so the crisis continues as expected.

See full articles at:

• Financial Times
• Business Week

EuoDoo Radio is live!!!

I am really proud to announce that a new page in Euodoo’s history is here.  This project has taken a little longer to get off and running then we expected but it is finally here.

Today starts a new feature for EudooTrading.com and that is the addition of Euodoo Radio and our radio show “Trading Places”.  This week our first interview will be of @FaithMight.  Lydia has been a great source of information on Twitter and through her personal blog and StockTwits, that we could not wait to interview her.  Here is the link to the interview and throughout the coming months you will be returning to hear other interviews that are soon to hit the ‘airwaves’.  Please let us know what you think.  I think you are going to love what you hear as much as I enjoyed doing the interview.

May I just say that I am deeply honored that these individuals would allow me and EuodooTrading to interview them.  Thank you Thank you Thank you.

TraderCisco

Here We Go Again – Is Japan Next?

Naoto Kan, Japan’s new Prime Minister while making his first speech to parliament last week said that “Our public finances have become the worst of any developed country.”

Japan’s public debt stood at 218% of gross domestic product last year, according to the International Monetary Fund – the highest in the industrialised world.

See a full report at Guardian.co.uk

As speeches are made, policies debated and bonds are sold, the market turbulence continues and almost every technical trading system benefits.

Now we can count on the Yen to move on its own to help our overnight ‘sleeper’ trades.

What a great summer is shaping up….This is almost as good as vacation.

Maybe we should call it TradeCation!!

Euro Instability To Grow This Week?

Spanish civil servants have now gone on strike, which is threatening to disrupt government functions. This is not surprising, but, as we trade the Forex today, we are expecting political comments from european leaders to affect the market.

Comments from the financial sector regarding bond ratings for Spain, and comments from spanish officials can move the Euro in the days ahead.

We are looking for any technical signs that smart money is, once again, moving away from the Euro, so we can follow the Euro down to its next support level.

See full article at cnn.com

See our earlier posts for reference at EuoDooTrading website.

HUGE SHORT CALL – ALERT FOR FOREX DAY TRADERS

Morgan Stanley is bearish on the Pound because of the election results and because of the wolf-pack that might attack Britain next.

They have a 1.3500 target for the Gbp/Usd.

To read the article Click Here.

FOOD INFLATION SPIRALING OUT OF CONTROL – BUT WE DON’T CARE

MarketSkeptics.com reported last Friday that U.S. fresh food prices have increased 56% in the past 12 months. The increase during the past month is the largest in over 26 years.

The Retail Sector will be the next to experience inflation as the gov’t increases its debt.

Their report states that “The U.S. government is now paying out more to Americans in benefits than it collects in taxes.”

They reported that the February 3.85% increase in retail sales (year over year) that was hailed as such a good number was so good only because of the increase in food and gasoline prices during the same period, which were 58% of the increase. So, more stuff was not purchased, just more dollars for the same stuff. That does nothing for productivity and job creation.

We are pleased to report that many of our friends are offsetting these price increases with the profits gained while trading the Forex with Tim Chandler. Tim’s daily webcast continues to assist with the identification of good market entries and continues to amaze the retail traders in the chat room.

If you have not yet tried it out, then you are missing a real financial benefit.

Check out the testimonials at http://www.investimonials.com/search.aspx?phrase=Tim+Chandlers+Trading+Room
Hey, U.S. Government, “Bring It On!”

What if Keynes was wrong?

“Fear The Boom And Bust” a Hayek vs. Keynes Rap Video from YouTube

This is great!!

WHEN IS 61 BILLION NOT ENOUGH?

Answer: When bailing out Greece.

Yesterday one of the German Central Bank Governors said that the amount needed might be 80 Billion.

We keep trading the Euro/Dollar Down with wonderful results, and the best might be yet to come.

See the full article here http://www.bloomberg.com/apps/news?pid=20601100&sid=a4Bm6ypa.pNw