Greenzone update 23-01-2015 So guys it is going towards the end of this week. I guess we all for once appreciate a little break , as it has been more than hectic !!. Draghi did his thing, as we all expected and a little bit more in fact. The last estimates before his speech on Thursday, indicated a QE of 50 bill a month . It came out close, but a bit higher than expected, namely at 60 Billion a month, which should for now run until September 2016, which means a total of 1.1 Trillion, so the previous estimates which most expected at around 500-750 billion were exceeded. Immediatley after the speech there wasn´t a too aggressive response, guess the big guys first had to let it run through their minds, but when it finally did move we saw a 500 pip drop. Reaching a low of 1.1115 today, before we saw it retracing back to the 1.1280 level, now descending a bit again towards 1.1250 . However should it rise a bit more, then there should be an increasing selling interest around 1.13 . So where are we heading ? . It basically depend on a lot of factors. Short term of course the Greek elections on Sunday where if the Syriza party will win, we should expect a decent drop again !. And as soon as the EURUSD again drop below 1.12 , it should keep going downwrds towards 1.11 at least which is currently the immediate support. However despite retracements and consolidations which should come as we descend, we have to expect a further slide of the EURUSD towards 1.08-1.05 at the end of the year. The only thing which can hold this would be that the USD starts to post some really bad numbers , as even now should the rate hike be postponed towards the end of 2015, it won´t change much in the current trend. There is of course a chance that the QE will have a positive effect on the EURUSD, which might then push it a bit higher !. But for now expect further slides. However be careful also as we are at such a low level that should something dramatic happen, and the Euro should gain strength or the USD lose strength ( big time ) , it is not likely we again will see this level for many years to come. So it is all a matter of where the rate will turn ! If it goes as anticipated and not many changes in market conditions are seen, we could indeed long term see the EURUSD going towards parity !. However for now , lets wait and see !!. Is the QE going to have any effect in the EZ then? . Of course it will, but the question is which ? Is it too late and too little or too late and too much? as you need to remember that the QE has weakened the Euro for now, so should the QE have negative effect then , we are likely to see some countries abandoning the Euro, just like the Swiss did when they unpegged themselves from the Euro . It cost them 60 B USD to do so. So they must see that the Euro will suffer so much damage, that this would be cheaper than keeping themselves pegged to the Euro !!. But be very careful out there !. We have now lowered the balance between buys and sells on ur Euro positions, just until we see where it is safe to sell again !. Actually adding a few smaller buy positions to keep the pair more balanced !. The Cable also took a major hike down the ladder, nothing like the Euro of course, but still a drop of more than 230 pips. Going below the psychological level of 1.50 being at it´s lowest level since summer 2013 . It did manage to fight its way up above 1.50 later in the session today , but only slightly, just clinging to the 1.50 figure. Chances are we might see a further descend towards 1.48 , despite the UK figures did improve, but they were followed by some dovish statements by Carney and Co. However I do not expect to see it lower than 1.48 , as the UK figures are improving and also the expensive USD is hurting exports , tourism etc !. So it could mean we will see some weakness in the USD medium term !: So for now also wait and see here, will it manage to stay around the 1.50 level , we might see it starting to move upwards again, however do expect it to be very sideways as usual !. In regards to the USDJPY , well then for the past week we have seen it pending between 117 and 119 . Of course with all the turmoil going on, it did benefit from its safe haven status, but so did the USD as well of course, but in a lower scale as the JPY does come cheap nowadays !: However we do expect that when all the news are out and the market can assess all the damage , that we again will see the USDJPY going north towards 119 first and then trying for higher numbers. But always careful with this pair as it´s known for its very big ranges and we could see it taking a further drop towards 116 before going upwards again !!: Also Abe was pretty neutral in his last speech, so it did balance the JPY a bit, but further weakness is expected to be seen !. But for now we are trading in mid-range around 117.80, so sideways medium term bullish here ! As you might have noticed then we did post a few Milestones this week, however since we are on extreme levels, we will be trading very carefully as not to get stuck with positions too low, so need to wait for stabilisation and consolidation , especially in the eurusd before we will again tip the balance too heavily !. So this is how the market goes, sometimes it´s better to act and sometimes you benefit more from taking a wait and see position !. Apart from that all I have left is first and foremost to thank the Greenzone team for their outstanding performance and tenacity this week ( yet again ) and for keeping up the good spirits and a cool head throughout the haywire we have seen recently. Making all accounts benefit and keeping the Milestones coming !: Also I wish to thank both new and old investors for their continued trust in us and for the followers for their interest in what we are doing here!!: You all have been really awesome and we thank you for the hundreds of messages and likes we have received during just this week. Now go and relax and have a fabulous weekend and no matter what your plans are, make sure you have fun. See you all when the forex gates open again in 2 days !! --- greenzone-invest - The serious investment company of unlimited opportunity!
Posted on: Sat, 24 Jan 2015 12:55:56 +0000
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