Update: 20th January 2016

Today had mixed results for us:

1.) As expected, the NZD fell today after inflation was weaker than expected. Inflation declined 0.5% quarter on quarter.
Resulting in renewed sentiment that the RBNZ will have to cut rates further , contrary to Wheelers comments after the last
cut. Expect NZD softness to persist for the time being.

2.) More positive UK data today showed that unemployment has fallen to 2006 levels. This in combination with inflation
being better than expected yesterday re-affirms my conviction that the UK economy will outperform the market this year,
much like the US did last year. Naturally the market is panicking today (will get to this in a moment) and nervous markets
ignore fundamentals, but the data exists to prove that the economy is in a MUCH better position than believed last week. I
was considering cutting our GBP positions if today’s data dissapointed, but today’s data reinforces my belief that these
positions will do well and I am now more determined to hold them. As I wrote yesterday though, i did not expect good news
to have an effect today following Carney’s contradictions yesterday that have everyone confused. Literally.

3.) Why is the market panicking today? Well oil keeps hitting new lows and is pulling equities with it and in addition we
had some terror attacks take place in Pakistan. This makes people turn to the haven JPY. Can not really see this lasting
for ever and feel that we are near the bottom and this is a phase like in August. With ever major economy reporting
improving employment and GDP (except Japan), I refuse to believe that we are in a recession, just a temporary crisis. To
that effect I purchased for us 300,000 units of USDJPY on Hotforex at 116.80 today with a target of 123 in Q1 2016. I
believe fundamentally that this trade works, and many of the large institutions forecast similar results (those of you who
follow me on twitter would have seen the photo i uploaded earlier from my Bloomberg terminal.) It is highly possible that
on the 28th of this month, the BOJ increases stimulus. Their strong Yen is killing Japanese exports to the Eurozone and
elsewhere and the Japanese know it. Earlier today, officials made comments that they are watching the exchange rate and
will not hesitate to act.

For now, I intent to soldier on, try to survive this temporary turmoil and hope to profit when the market stops acting
like a scared child and risk appetite returns. I really hope it passes sooner rather than later, so I can actually not
dread looking at my balances every morning.

In the next 30 mins, we await inflation data from the US which will be crucial to determining whether a March move by the
FED is on the cards or not. Given strong employment, I feel that slightly positive data today will give the fed incentive to raise rates a second time,



  1. Thanks for the updates as always very much appreciated, unfortunatly I had to close the gbpchf trade manually this morning as my sl was very close, just about hanging in there at the moment.
    Still have complete and utter faith in you and your analysis, and will finally be joining you on hot forex later today hopefully, will your newly opened gbp jpy position be automatically opened on there or have I now missed out on that trade?
    Thanks again

  2. Thanks for the update Mo. Seems the Ninja quite strongly rejected the 115 level that was insight so hopefully we can start heading back up.

  3. Thanks again Mo 🙂
    I was stopped out and will recopy you, but is it a good idea to Copy open trades now since everything is in red?

  4. Unfortunatly most of my own GBPJPY trades hit SL at 164.00 and 165.00 🙁 80% asset gone, but again all my own fault martingale your trades with even more money. I trust your judgement and maybe the 10% left into copying you can be turned back to 100% end of the year and I have learned again a very valuable lesson. Keep up the good work and updates! I trust your judgement.

  5. Hi Mohammed, thanks so much for the updates. I had the honor to join you on HotForex this weak. My account is in red right now, but I believe this was because I entered when you already had a good long open positions and I entered at a high price point so I didn’t benefit from the current open positions. Today I can see you have a new open long positions of 3 lots USDJPY, so I consider today as the first day. I am still not familiar with HF, so I want to make sure that my account is fully linked to yours, do you have right now 4 open postions 3 of them are long and 1 short?

    Thanks Mohammed and Have a great day =)

    Best regards,
    Mohamed Abdelhadi

  6. Thanks for keeping us up to date.
    I’m always looking forward to your daily analysis.
    It’s reassuring and makes me confident in the future.
    All the best

  7. Thanks for the update Mo,

    It gives me hope. Something that was deserting me…. This morning I was trying to work out which losses on my account to cut to help save my account, a very depressing experience. Lets hope oil doesn’t screw us again. Do you thinking all the Euro news tomorrow will have much of an effect on our trades?

  8. Hi Mo, I got csl’d on etoro from copying you this morning. It’s a shame but I’ll live :). Was just wondering if you are definitely leaving etoro as I would like to re copy you as I Think you have taught me a lot. It’s a shame etoro can’t let you block the negative people.

  9. Another drops of Mo’s balsam against stress. Thanks for your updates. I can read that i Am not the only one that is waiting your letter. Thanks again.

  10. Good stuff, thanks for your update! I’m still with you on EToro, sadly can’t join you on HotForex because I’m living in Malaysia, otherwise I wouldn’t hesistate. Keep up your good work, thanks again.

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