Winston
27-09-08, 02:42 PM
Had friends ask me about my opinion on the 2mth promo for AUD at 7.25% for some banks.
I said: Your RM will probably give you a whole bunch of "economic facts" why taking the FD is good. So, I shall not dwell in that. (doesn't mean i agree or disagree. some are logical, some are not.)
But, lets take a look at the charts. (charts belong to netdania.com. They provide some really good free stuff there.)
Top Chart
General outline of the Aussie in Weekly Candles.
What does it look to you?
I think even non-traders would be able to see that we are in a nice bouncy zone. Like the pinball machine. Each line looking candle is 1 Week (so a 2 month forecast would take 8 of those candles.
Bottom Chart
The Zoom in Version.
1) Charting Price Action looks like a nice rebound, especially when the shortening shadows and it resting on the floor. I would look at least the "UP 1" or "UP 2" range.
2) As expected, the MACD looks shows an up-turn.
3) The ONE worrisome thing is the shadows downwards are very long. So, in the next 2 months, it could actually hug the floor line with the shadows reaching down, and still have it as a valid picture. So, you might be stuck with an FD that needs to be exchanged at 1.1200 on the downside.
Hence ....
I think the AUS/SGD picture is quite fine, if you have other reasons besides plain capital appreciation. I.e. children's education, aussie property repayment.
The only thing worrisome is the long shadows.
heh... For a simple FD capital appreciation play, this is not a good high probability pair with its current volatility.
cheers,
Winston
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Remember, markets change every 2 candles! What I say is only valid for the next 2 candles.
Be an independent trader, join the best in Forex Education in Singapore - www.ForexForRetirement.com
=====
I said: Your RM will probably give you a whole bunch of "economic facts" why taking the FD is good. So, I shall not dwell in that. (doesn't mean i agree or disagree. some are logical, some are not.)
But, lets take a look at the charts. (charts belong to netdania.com. They provide some really good free stuff there.)
Top Chart
General outline of the Aussie in Weekly Candles.
What does it look to you?
I think even non-traders would be able to see that we are in a nice bouncy zone. Like the pinball machine. Each line looking candle is 1 Week (so a 2 month forecast would take 8 of those candles.
Bottom Chart
The Zoom in Version.
1) Charting Price Action looks like a nice rebound, especially when the shortening shadows and it resting on the floor. I would look at least the "UP 1" or "UP 2" range.
2) As expected, the MACD looks shows an up-turn.
3) The ONE worrisome thing is the shadows downwards are very long. So, in the next 2 months, it could actually hug the floor line with the shadows reaching down, and still have it as a valid picture. So, you might be stuck with an FD that needs to be exchanged at 1.1200 on the downside.
Hence ....
I think the AUS/SGD picture is quite fine, if you have other reasons besides plain capital appreciation. I.e. children's education, aussie property repayment.
The only thing worrisome is the long shadows.
heh... For a simple FD capital appreciation play, this is not a good high probability pair with its current volatility.
cheers,
Winston
=====
Remember, markets change every 2 candles! What I say is only valid for the next 2 candles.
Be an independent trader, join the best in Forex Education in Singapore - www.ForexForRetirement.com
=====