Weekly review.

I began the week starting Monday 30 August with a bias for 'risk on' trades. And the JPY weakened on Monday, although it was in 'low liquidity' due to labour day. But by Tuesday, the tide started to turn and negative sentiment started to creep in, which was compounded by 'soft' US manufacturing ISM data. And the market once again began to worry about a US recession and that the FED is 'behind the curve'.

The apprehensive environment remained for the rest of the week, which meant even 'soft CPI' data from Switzerland didn't weaken the CHF. Similarly, the CAD didn't weaken, even after a BOC rate cut and disappointing data.

On Friday, the NFP headline number was a little lower than forecast. But all things considered, I thought it was an all round decent report that not long ago would have been deemed 'Goldilocks data' suggesting a 'soft landing'. But after taking time to make up it's mind, it appears the market once again want to 'fight the fed' by suggesting a 0.5bp rate cut is needed rather than 0.25bp. and it seems the sour mood is set to continue as the new week begins.

On a personal note, it was a week of just one trade, a 'risk off' AUD JPY short. And I'll begin the new week taking cues from the VIX and the S&P. being aware of the seemingly weekly changing sentiment as the market is extremely sensitive to US data.

Feel free to email any questions: johnelfedforexblog@gmail.com

Results:

Trade 1: AUY JPY +1.5%

Total since start of blog = +27.6% (risking 1% per trade).