Post Fed Reflections and Strategy

GENERALLY SPEAKING - Just as a reminder, bouts of Dollar demand are still expected and should continue to come as we move forward, but overall, if the US administration is serious about paying down the deficit and making some real change on that front, it will be very motivated to continue to push forward with its protectionist agenda. This means overall, the Dollar should continue to be well capped into rallies against the major currencies. I have also said that all of this could come at a time when US equities have finally at long last begun to really reverse course, which means that we very well could see a scenario where the more risk correlated commodity bloc and emerging market currencies weaken against the Buck despite the soft Dollar policy, with the safe haven demand too much to ignore for these currencies.

STRATEGY - As I look at things right now, I've tried to take the bigger picture view, though with such an outlook, one needs to know how to ignore the noise along the way. The plays that I love most I have positioned for as per the updates and I will continue to look for the Pound to eventually start moving back up and will continue to look for opportunities to sell USDJPY into rallies. The only other play out there right now that looks compelling is the AUDNZD play that we love so much and that has been so good to us over the years. Still, it isn't quite there again yet and I will wait patiently to see if it comes our way again. I'm think a long position in the 1.0700 area is making sense and will happily jump on it if the price action is right. Today we get another central bank event risk, this time by way of the ECB decision and as a reminder, there is room for fireworks here with all of that talk making the rounds about the ECB officially announcing the end to QE. Let's see what happens.

IMPORTANT NOTE: Trading forex, futures or futures options carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. This website and its information does not take into account your investment objectives, financial situation, or needs. Before deciding to trade forex, futures or futures options you should you should carefully consider your investment objectives, level of experience, and risk appetite, as well as obtain advice based on your unique situation before making any investment decision based upon this forum or any information contained within. This forum and the information provided here should not be relied upon as a substitute for extensive independent research before making your investment decisions. JKonFX is merely providing this website for your general information. Past performance is not necessarily indicative of future results. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. JKonFX will not be responsible for any losses incurred on investments made by you as a result of any information contained in this website. You should be aware of all the risks associated with forex, futures, and futures option trading, and seek advice from an independent financial advisor if you have any doubts. In addition, the information contained on this website is not intended to be investment, legal, accounting, tax or other professional advice. If such advice is sought, or other expert assistance is required, the services of a competent professional should be sought.