Analyst picks for 20 November 2012


My pick: Long dollar-yen, short Aussie-New Zealand dollar.
Expertise: Fundamental and technical analysis.
Average time frame of trades: 1 day to 1 week.

Last week’s trades (short Aussie-dollar, long sterling-yen, long dollar-yen) worked well. However, heavy fundamentals and the Thanksgiving holiday make for confusing times ahead. To curb risk, I will stick with the long dollar-yen based on my fundamental views. Aussie-New Zealand dollar may break a head-and-shoulders pattern. For a more risky trade, going long euro-yen may work well, based on holiday hours and a Greek aid program.


My pick: Short euro-dollar and Aussie-dollar.
Expertise: Global macro.
Average time frame of trades: 1 week to 6 months.

I sold euro-dollar at $1.2982 on 31 October after prices broke a rising trend line support. This hinted that the euro would continue to decline. As traders flirt with $1.27, I will continue holding the trade. I expect the woes of the debt crisis to push the pair toward my target of $1.2619. I went short Aussie-dollar on 15 November at $1.0381, as a bearish trend shift in the S&P 500 was likely to sink the the pair. I will hold this trade with a target price of $1.0181.


My pick: Long Aussie-dollar, euro-dollar, and gold.
Expertise: Fundamental and technical analysis.
Average time frame of trades: A few hours to a few days.

I added to these positions on Friday. However, with thin trading conditions expected this week, due to the Thanksgiving holiday in the US, active trade management will be required. The long Aussie-yen trade from ¥82.08, discussed last week, was closed at ¥84.10 for a 202-pip profit. For the most part, this has to do with yen’s weakness due to the political posturing in Japan, which may continue for several weeks to come.