CHINA FIREWORKS

 

“You can’t even do frickin’ I.N.S.A.N.E. right …  now can you!?”

You know to leave it alone, when the first M1 out of the open has almost a 100 

point range … you know to leave it alone when M1’s are clocking 40 - 70 point 

range moves … FINALLY, you know to leave it alone when you get a 550 point 

range in 19 minutes, and the week’s 20 Day MA is around 475 points 

… “where the hell does it go now? How do I capture an expanding range now”?

Of course, the “Chicoms” pulled a fast one last night … allowing USDCNH to 

go up approximately 500 PIPS [Yuan lower] in about 35 minutes around the 

open, then letting it stabilize somewhat until Lunch … and then after the 

1 hour market Lunch break, the Chinese state owned banks come in and 

pound the living hell out of USDCNH [Yuan higher], as it promptly goes about 

900 PIPS lower, in as grand of  style “Thelma & Louise” as you are likely to 

ever see, in around 4 hours. “Talk about getting “played”, traders now know 

what violins sound like when they get carried out toes up”!

It is critically important, you understand the “dynamics” of “meth addicted, 

bat shit crazy, criminally insane markets”! The daily range, and more 

specifically, the 20 Day MA value of a market’s range, play two [2] crucial 

functions you have to understand and use to your advantage when trading this 

market.

Each Sunday night, I’ll be giving before the Hang Seng Asian open, the 20 Day 

MA values for our primary market, the H33HKD, and the other 5 market I’m 

covering in a secondary capacity … primarily, this number is important, cuz it 

gives us a roadmap of the “insanity” this market travels along during its 

trading day. “Come hell or high water, somewhere around this value, the market 

is gonna see this value of a range at some point during the day … on its way to 

that range, there are gonna be buy/sell signals [hopefully], and when you find 

yourself up in a position and the market is trending in your profit direction, it’s 

vitally important to know where price is potentially heading according to the 

20 Day MA … this is how you get “pony rides”!

The second function is one of pure volatility to help make back early trade 

losses, should they occur … “when the ranges are extraordinarily large, you 

pretty much always have the potential for rallies and breaks, that come out of 

nowhere and trap longs/shorts, and thus can give you ‘OPPORTUNITY” to 

make profitable trades and recoup losses … where do you stand a better chance 

of recouping losses, than a market that has, on average, almost a 500 point range 

every day? Do you get this in other markets”? … Short Answer: “You sure as 

hell don’t, except on rare occasions”!

Turning to today’s Hang Seng market … “well, that escalated quickly didn’t it”? 

I’m watching the first hour, and we came within 2 frickin’ minutes of a sell 

signal that would have gotten us short, right before the “Thelma & Louise” epic 

waterfall that went lower 550 points in 19 minutes … “Oy vey, comes to mind, 

but I’m reminded throughout my many years & decades of trading, that shit 

happens and not to let it bother me … still, “Oy” in spades”!

“So, now what? … we just saw the 20 Day MA range in 19 minutes, with no 

signal … where/how do I make money in this with any signal coming up? … if 

it’s on the upside, where’s it gonna go, given the damage done already, and the 

low probabilities of a reversal [which of course, we did see!] … and from the 

downside, new lows put us down over 900 points from Friday’s close, so I’m 

supposed to believe “a thousand & something” is in the cards, and 2X the 20 Day 

MA”?

Trust me, there isn’t a damn thing you can do here … leave it alone. We got the 

dual problems of 1) catch up cuz Monday the market was closed, and 2) “we’ve 

all become Yuan traders now”! Neither is an option that appeals to profits, 

simply cuz the reward /risk profile is as “F’d UP” as it’s ever going to be in 

trading, at this moment … touch a button, you’re going to regret it!

Only one trade today … PAMM up a few pennies, “scratch city”.

I want people to realize just what happened today … first up, USDCNH 

[Reminbi] rallied 500 PIPS, and then got slammed 900 PIPS! “When’s the last 

time any of you EURUSD or USDJPY traders ever see a 900 PIP range in 4 to 5 

hours, and more importantly, would you be around the next day or headed back to 

the “Pudding Biz”, with some deep emotional scars for the effort”? Secondly, 

prices in the Hang Seng are moving so fast, they look like the meter in a 

New York taxi … don’t like the price? … wait 30 seconds and it’ll be at least 50 

points in some direction … rinse, repeat the first few hours, and this shit makes 

“insane” look very respectable.

Fact is folks, when markets get like they were last night, they come very close 

to “tilt status”, and then the frickin’ system breaks down and everything goes to 

hell in a handbasket … we were almost there. Forget profit, this is for survival!

That takes us to Lunch, and an hour break, and right out of the gate, here 

come the Chinese state owned banks, and USDCNH goes redux  

“Thelma & Louise”, only with a much bigger cliff … 4 hours and 900 PIPS 

later, the damage is immense and widespread, not only in FX, but in the 

Hang Seng as well … add it all up, and the wild rides = approximately 1300 

points, on a massive reversal day, that once reversed went nowhere … “kill the 

longs, kill the shorts, then go back and take the rest from the longs, call it a day”!

Leaving the day up a penny … anything, cuz it doesn’t matter … just surviving 

the insanity and moving on to tomorrow, is a victory. This market, and the 

USDCNH when it gets going, make everything else on the board look like oat 

spreads. Would have been nice to get an algorithm sell signal early … didn’t 

happen … not the last time this market sees these kinds of moves … hell, 

tomorrow is only hours away … “just another average day in the trading insane 

asylum”.

No U.S. markets tomorrow, but that isn’t gonna matter to Asia … more  

“rock & roll” on the way tonight, although I would expect things to settle down 

somewhat, and see early moves more restrained than what we saw last night 

… we’ll see, BUT the more restrained “insanity” should make for some good 

algo trades, when we get ‘em. The algorithm today did a fantastic job of 

keeping donkeys out of trouble, and bypassing “false positive” Cloud breaches 

for loss … sure, some of them were good, but they only paid for the ones that 

weren’t. So, on to another day … and with that, I’m outta here … until 

tomorrow mi amigos … “the future’s so bright for us in Hong Kong, I gotta 

wear sun tan lotion to bed in the Caribbean, not to get burned”! 

... Onward & Upward!!

PAMM spreadsheet directly below.

 

Have a great day everybody!!

-vegas

OUR TURNKEY FOREX “PAMM/MAM” IS NOW OPEN AND

OPERATIONAL; SEE “PAMM/MAM MONEY PROGRAM” IN

“DOWNLOAD LINKS” SECTION IN RIGHT HAND COLUMN

FOR DETAILS [VIEW ONLINE AND/OR DOWNLOAD] AND

START YOUR JOURNEY FROM WHERE YOU ARE AT TO

“ESCAPE TO SUCCESS”!

 

 

A MALIGNANT INDIFFERENCE TO YOUR PLIGHT

 

The insane asylum called the LP’s; “get your FX clowns outta here NOW!”

 

It’s Thursday; as everybody who’s a regular reader here knows, Christmas morning [Monday] saw the biggest theft of money in FX by an LP bank in trouble, specifically EURUSD, since October 6, 2016 when GBP got “mugged & held up”, and saved a bunch of FX execs a ton of mistress trouble going into the Holidays. And seeing the action in EURUSD since the 7-11 FX robbery, it’s been straight up the flagpole to the 1.19500 area. “Anybody besides me find all of this just too convenient a coincidence? Cuz in my eyes, it’s plain theft, pure and simple”.

Of course, we won’t hear anything more about this for a while … I’m guessing 3 – 5 years … but a day will come when the headlines break yet again of LP bank criminality … of course, nobody goes to jail or wants to see it end, cuz that means the “gravy train” is over … “for heavens sake, what’s a poor Schmuck regulator in Germany or the U.K. supposed to do with a “gold digger wife” that demands the “high-life” but his piddly regulator salary just isn’t cuttin’ the mustard? C’mon man, I need the cash”! … yea, sure you do … however, I’m sure there are some corporate & large hedge fund types ready, willing, & able to “go to war” with what happened to them, and I’m pretty sure the appointments at the law firms have already been lined up come 1/2/2018. And it’ll be “deny, deny, deny, … and then during discovery … we, in senior management, had no idea this was going on … after we pay the $100 million dollar fine, we can assure the public this won’t happen again”! Round up the usual scumbag LP bank suspects, namely Vampire Squid [Goldman], JPM, Wells Fargo, Deutsche Bank, Barclays, HSBC, & Bank of Tokyo for starters and start throwing some of these management shitheads in jail, cuz this just keeps happening over and over again with these scumbags.

Which brings me right to today’s trading … cuz the only … and I mean only, thing going on is LP banks “front-running” corporate order flow, necessitated by year-end accounting. And while the FX “whiz kid” on the desk is smooth talking the corporate exec on the other end about XYZ, Inc.’s need to buy a billion EURUSD, he’s frantically signaling others to front run the trade coming in about 30 – 45 seconds … when they’ve all loaded up, the FX “whiz kid” cuts to the chase and says, “right now … I mean NOW … I can do the order for you at 1.19410 [everybody is already long at 1.1936-ish with sell orders at 1.19410 … markets at 39 … only a 2 PIP premium … I’m takin’ a real risk here Jimbo, giving you this kind of deal, but you’re a good client … gimme the OK, and it’s done”. And after the “Ok”, our “whiz kid” forces some unfortunate orders through that show the market just traded at 42 or 43, so he can say to Jimbo, “Ok, filled 1 Yard [that a billion stuff] at 41, market last traded 43 … you got a great deal man”! “Hey, thanks whiz kid, talk later … bye”.  Then, of course, it’s time to pop the Bollinger and divvy up the $50 K they stole from XYZ, Inc. and laugh their collective asses off … until next time, which knowing these assclowns the way I do, could be in about 10 minutes.

And so, you’re looking at your MT4, and the market rockets up to 41, and then spends 20 minutes crawling down to 36 … and then BOOM! … within 3 seconds it’s hitting a new high at 43, and you’re saying to yourself, “WTF was that”? Now you know Skippy!

And, it’s been like that since I flipped the screen on at slightly before 3 A.M. EST … 3 -5 PIP spikes alternatively up & down, that happen in less than a second before reversing … it’s simply an endless “mugging & holdup” from all the usual suspects in thin Holiday markets, where they are taking extreme advantage of year-end corporate order flow from the likes of morons like “Jimbo”, who took a course at the JC on the company’s dime and thinks cuz he knows what a PIP is, that somehow he is “connected” to the FX trading world via our “whiz kid”. So, when you start seeing M1’s that make no sense, think Jimbo getting bent over the proverbial railing, cuz that’s what’s happening in real time.

Holiday markets this year are the worst I’ve seen them in at least 6 – 7 years; it’s not unusual, but the absence of anything out of Europe lately … with everything coming in New York … is a little strange and worth watching; I’ll be interested to see if this continues in 2018, cuz if it does it means heightened volatility. “Trust me, nobody screws institutional & retail orders better than New York banks … and given the chance, they will take the challenge, grab the ball, and ram the rock down your throat … count on it”.

I made one trade today for small profit … once I saw what the action consisted of and how the order flow was being handled, I didn’t need convincing to click the liquidate long button on a new high for the session at 1.19411 … fill was excellent, as I hit the button on the way up to 1.19414; when it backed off I executed … literally 2 seconds later market is at 1.19380 … yea, it’s that kind of day; utter “bat guano”, but it is what it is and there’s nothing we can do about it. I’ve been here now about 9 - 10 hours, and from the European open it’s been 10 – 12 lower and 15 higher … regular readers should recognize that tiny ranges like this mean total havoc with the algorithm … you got signals all over the place; half the time they are on top of each other … some work, a lot of them don’t, simply cuz there is no intraday volatility to play off of and take advantage. It’s just a bucket of hog slop. As we now work our way into the New York afternoon, EURUSD is nothing more than a coin flip, and quite frankly, I can’t see a helluva lot of action worth hanging around for and risking money … for what exactly? Cuz the way the market is right now, your reward is 2, your risk is 10; at some point somebody is gonna get disappointed, and like yesterday after hours of a crawling market higher, it’s all gone in 7 minutes. And if they keep rallying this market, come next week there’s gonna be a “reckoning” with the ECB, who unless they’ve changed their collective mind via Super Mario, they most definitely don’t want to see a 1.20+ EURUSD … so, even if they click off a few stops, where does it go in the NY afternoon? I just don’t see any upside here that warrants a long position, cuz I don’t think the market has any place to go in this Holiday market atmosphere. Anyway, this is/was my rationale for limited trading today.

I get done with outside cleanup yesterday, get to my computer after dinner, and what refuses to open? “Of course, why should anything work now? The whole day has been “FUBAR-ed”, why should this be any different”. So, I picked up the phone, called the “Geek Squad” over at Best Buy, and today at 6 P.M., I’m gonna let the techie over there fix it. He says he knows what the problem is, and fixed it before for others, so it should be Easy Peezee. So, PAMM spreadsheet tomorrow in the blog post. “I just shake my head anymore about stuff like this … it’s like the universe is saying I don’t have enough BS in my life at the moment, here take some … apparently, it hasn’t been paying attention”. Ok, I’m officially outta here for the day … I simply can’t take any more of this “tenth of a PIP” bank LP meat-grinder. Until tomorrow mi amigos!

Have a great day everybody!

-vegas

OUR TURNKEY FOREX “PAMM/MAM” IS NOW OPEN AND OPERATIONAL; SEE “PAMM/MAM MONEY PROGRAM” IN “DOWNLOAD LINKS” SECTION IN RIGHT HAND COLUMN FOR DETAILS [VIEW ONLINE AND/OR DOWNLOAD] AND START YOUR JOURNEY FROM WHERE YOU ARE AT TO “ESCAPE TO SUCCESS”!