6/2/2014
There many ways to analyse traders’ performance and prospects. As history has shown, traders have cycles just like any other asset or pair, like EUR/USD or Gold , for which technical analysis could provide an interesting perspective. Today we focus on one trader who experienced a negative cycle, but when technical analysis is applied looks far more interesting. This trader is Anas Sleiman , a trader from Ireland that is mostly positioned on the Dollar arming the currency to ride vs its peers. What is at stake and what could allow Sleiman to recover?
Sleiman and the Double Bottom
So who is Anas Sleiman ? Certainly he is not an anonymity; not with more than 5,000 followers. Sleiman had been remarkably successful but then crashed, i.e. boomed then busted. During the boom, Sleiman had a 50% + return for the year then crashed all the way to a -43% return, a very painful bust that is typically the result of his high risk high leverage style. Yet, as seen in his performance chart below, technically Sleiman has performed a double bottom. In the FX space, this pattern in a pair is treated as an indication of a rebound. But the question is what pushed Sleiman to rebound? Unsurprisingly, his position; Sleiman is heavily positioned for a Dollar gain against the GBP and the CHF meaning if the Dollar recovers, Sleiman could recover as well and rebound from his double bottom. The question is what could affect his position?
The Events that will Impact Sleiman
So which events could impact Sleiman ? Next week, markets will spotlight on two key events; the European Central Bank rate decision due on Thursday and then on Friday, the U.S. Labor Department’s release of non-farms payrolls data. Investors’ expectations continue to grow that the ECB will put in place some form of easing, either it will be announced outright or Mario Draghi could later hint at a likely policy change at the next ECB meeting. Draghi has been dropping numerous hints in favor of easing recently, but that doesn’t suggest any certainty given that the ECB council decides monetary policy, together. If the ECB council does decide to ease, that will effectively weaken the Euro but only to the extent that such an outcome hadn’t already been priced in. On the other hand, an easing reprieve could spur a resumption of Euro demand.
For the Non-Farms Payroll data, the Dollar’s value ahead of the data will depend largely on the ECB decision and the markets’ reaction to it. Afterward, whether it moves higher or lower will depend on the NFP results. If the numbers surprise to the upside, say above 280,000 new jobs, that would be dollar positive as an indication that the U.S. labor market’s recent uptrend is stabilizing further. Meanwhile, a disappointment in the data would have a negative impact on the greenback, suggesting that the jobs trend wasn’t as solid as previously ...
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