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#72 The Central Banker’s week

The Central Banker’s week

US drone downed in Iran – Central Banker ready to provide extra accomodation – Protests at Hong Kong continue

12 minutes read report, 8 pages

To help speed reading blue is used for new arguments, forecasts are underlined and found at the beginning of each page, hyperlinks are marked.

 

 

 

How the forecasts did:

Despite the fact that my readers have not received last week’s report, they were forewarned to turn their attention to an upcoming rate cut since the 8th of June report. We are no longer inside the tightening cycle. Markets are currently pricing in a 31st of July FED rate cut and I have been directly pointing to that scenario at the title of the 70th issue of this report.

Eventually, that has been the most crucial development of the previous week and shorting USDindex at 97.11$, as it was proposed at the 10th of June report, proved to be a very rewarding entry point.

The long EURUSD trade at 1.1171 was missed by 9 pips, shorting the GBPUSD was not triggered, going long EURJPY is 22pips in the green and going long AUDUSD is 4 pips in the red.

I keep favoring the short USD, long equities-oil–EUR–AUD-CAD scenario for 2H2019.

Major events of last week:

Major events of next week:

JPY

Long EURJPY at 121.65

 

Strengths of JPY:

Weaknesses of JPY:

Watch / New Releases:

AUD

Keep the long AUDUSD trades until 0.7111

 

Strengths:

Weaknesses:

Watch / New Releases:

CAD

No forecast for USDCAD

 

Strengths of CAD:

Weakness of CAD:

Watch / New Releases:

USD

Short USindex trades at 96.11$, 96.43$ and 96.58$,

Strengths of USD – Risk off points:

Weaknesses of USD –Risk on points:

Watch / New Releases:

EUR

Long EURUSD at 1.1264

 

Strengths of EURUSD:

Weaknesses of EURUSD:

Watch / New Releases:

GBP

Short GBPUSD at 1.2934 and 1.2958

 

Strengths:

Weaknesses:

Watch / New Releases:

Disclaimer

Issued by Labis Michalopoulos, CFA

labis@quantomental.com

https://quantomental.com/

https://dxml.wordpress.com/

For the readers of the report:

Redistribution is allowed as long as the author and his contact details are referenced.

This material is for Qualified Investors and Professional Clients only and should not be relied upon by any other person.

Past performance or past accurate forecasts is not a guide to future performance and the accuracy of future forecasts and should not be the sole factor of consideration. All financial investment decisions involve an element of risk.

This report is for information purposes only and does not constitute an offer or invitation to anyone to invest or trade and has not been prepared in connection with any such offer.

Any research in this document has been independently produced by Labis Michalopoulos, CFA for his own purpose. The views expressed do not constitute investment or any other advice and are subject to change. The author has an interest in the currency pairs, indexes and any other security disclosed in this report, as he is an active trader.

Reliance upon information in this material is at the sole discretion of the reader.

 

Opinions expressed in the report do not represent the opinion of Zulutrade and do not constitute an offer or invitation to anyone to invest or trade.

 

 

 

For qualified perspective clients of the advisory service:

GIPS standards are all about full, fair, consistent and comparable presentation of actual returns of the past. No models, no back-testing, no promises. I am doing that. I am publishing in real time, via a 3rd party, my actual returns since inception where one can see the most strict, comparable, revealing metric of the industry: the monthly Sharpe ratio.

My current monthly Sharpe ratio stands at 0.27 as can be found at www.forexfactory.com/dxmix

My current annual Sharpe ratio is 0.27 multiplied by 12 = 0.27 x 3.46=0.93 Annual Sharpe Ratio

The numbers used to stand at 0.5 monthly Sharpe ratio and 1.73 annual Sharpe ratio up until the August of 2019 for 45 consecutive months. On 24 August 2018, I mistakenly ordered to open a position 10 times bigger that I am used to. My equity level is currently back on track, but my statistics are no longer as impressive as they used to be. My 54 months, since inception, monthly Sharpe Ratio (that includes the leveraged AUDUSD trade) stands at 0.27, equal to 0.93 Annual Sharpe Ratio.

I cannot claim that I will be performing with the return of my best months, but I can tell that I will hover around my average returns. Claiming with a 95% confidence, that my next month* return will be within my average monthly return ± 2 standard deviations is a well educated statement I can make anytime.

My average monthly* return ± 2 standard deviations is from -16.54% up to 20.49%

My average monthly* return ± 2 stadard deviations becomes -5.74% up to 9.47% , excluding the 4 months effect of the one time mistake trade.

 

* the monthly returns are the actual returns within a month. They are not presented on annualized basis.

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