Trading Blog Update

Trading Blog Update

Although the purpose of this trading blog isn’t to have people buy everything I’m bullish on and sell everything I’m bearish on, many seem to find it useful to keep track of what an author’s trading views are at that time. Therefore I always try to list a couple of things I’m buying or selling at the moment (or looking to be), but I try not to include size of positions, risk element, profit expectations etc – just a broad overview to be taken as hearsay and nothing more. Regardless, I thought it might be good to take a quick look back and see how some of the early calls have gone, and where they might be heading:

28.12.11 – Short 10 yr US Treasury Notes

The yield was 1.9% at the time of recommendation (blog went live 28^th), is now at 1.84% and has ranged between 1.84% and 2.07%, giving profit taking opportunities for those short (prices fall when yields rise) despite a the loss seen on the position for those that are still short. The Fed’s announcement rates will stay at zero through 2014 is no surprise, and inflationary spikes are likely to see this rate form a floor around 1.7% with a whole lot of long term upside (prices to fall). Down 6 basis points.

28.12.11 – Long gold mining stocks whilst short gold bullion

Newcrest mining is up 12% and Kingsgate has made a massive 31%, relative to the 10% upside seen in the gold price. Newcrest (Australian) and Newmont (US) still have upside relative to gold, as they are still pricing in a gold price around $1300 an ounce, but profits should be taken on those that have excelled, such as Kingsgate, locking in the 20% gain on around half the trade’s capital. Up 11%.

3.1.12 – Short USDJPY

The entry was around 76.7, with the current quote sitting at the same level. It does seem a technical floor is being formed around here, hence the position is no longer recommended and any holding the trade would be advised to exit flat. Flat.

6.1.12 – Long XJO

A short term trade, entered around 4109 and exited a few of days later at a similar level. It was aimed at capturing a short term, risk on movement, but markets were relatively flat. Flat.

9.1.12 – Long WOW.AX

This consumer staple was recommended at 25.3 and was only held for a few days, being exited at 25.65. It was held as a pair with the short AUDUSD position (below), helping to offset the loss below slightly. As the risk on trade has been witnessed this past week, the defensive Woolworths has weakened, but short see medium term strength at these prices. Up 1.3%.

9.1.12 – Short AUDUSD

This was a short term trade, entered around 1.024 and only held for a few days (not recommended in the next post). The exit would’ve been around 1.032, resulting in a medium size loss considering the time period. The currency is benefiting from comparatively high Australian rates, but will suffer if the risk off trade is put on in size. Down 0.8%.

13.1.12 – Long Shanghai Composite and Australian mining stocks

A medium term trade seeking to benefit from China relaxing its monetary policy to boost growth. The Chinese index is up 2% so far, BHP.AX around 2.5% and RIO.AX another 6%. The trade should be held on to, despite the volatile road, as these stocks will benefit most from the eventual recovery and could rally early if China looks to boost GDP. Up 4%.

As always please leave any comments or feedback that you may have, and if you’re looking for a more simplistic guide to trading, try www.tradingpimm.blogspot.com.