The overstretching of the fx markets in the month of Jan has left the world now vulnerable to a mega move.
That EURJPY has appreciated 10% in the month of January is surely not a feat for the faint hearted and there are many a heart burnt soul out there whom I can potentially empathise with for I have initially long the EURJPY move but faded it too early.
Table of Changes from 3 Jan 2013.
So I called the former trader chap and asked for wisdom for I am suffering from mild concussion.
He says this.
50-50 chance now for trades.
* USDJPY setting up for strong move, either up or down 150-200 pips before week close.
* USDSGD stay long. 1.2822 by May.
* AUDUSD stay short.
* 10Y UST stay short.
And I am thoroughly disgusted by the reckless behaviour I am witnessing right now. People tripling up on their USDJPY, turning long now for 3-4 times their usual size because they were wrong.
That certainly warrants mega moves.