Johanes
Long

JLS: GBPJPY Target Zone Trading - 2000 PIPs

FX:GBPJPY   British Pound / Japanese Yen
Estimated target zone 2000 PIPs
Average monthly price fluctuation 400 PIPs, time to complete 5 months
Current reached, 800 PIPs, balance 1200 PIPs (3 months)

Target Zone Trading Strategy:

Long below the current monthly lower ceiling
Stop loss below entry rate, 100-150 PIPs, to be managed overtime to risk free
Target 1200 PIPs, plus price correction

Monthly Target Zone Trading Strategy:

Long below the current monthly lower ceiling
Stop loss near entry rate, 100-150 PIPs, to be managed overtime to risk free
Target 400 PIPs, plus monthly price correction
Feb 28
Comment: I am waiting for the right levels to trade. I miss this current monthly ceiling
Mar 01
Comment: The current economic performance to suggest the long on JPY-pegged pairs to be repeated from their new lows of monthly bands/ceilings
Mar 02
Comment: The price drop on the CADJPY will impact other prices. By interest rate differential pricing, the NZDJPY, AUDJPY, GBPJPY, EURJPY and CHFJPY will be pressured down may be as much as the pressure experienced by the CADJPY, except carry traders adding more buying on CADJPY to slower the pressured prices by interest rate differentials. However, the impact on USDJPY will not as much as other due to the interest rate differetial of USDJPY is higher than CADJPY. All those pressures could be seen interior their "monthly bands/ceilings" and to provide new opportunity to re-long/re-buying.

The most accurte mearusement however is to long CADJPY at her equivalent weigthed rates to CADCHF, EURCAD and USDCAD interior their monthly bands, similar to NZDJPY, AUDJPY, GBPJPY, EURJPY and CHFJPY.

I will continue t long/long/long the interest rate differential prices of the USDJPY, CADJPY, NZDJY, AUDJPY, GBPJPY, EURJPY, CHFJPY, and at the same time to long/long/long the interest rate differential prices of the CADCHF, NZDCHF, AUDCHF, GBPCHF, EURCHF, and at the same time to short/short/short EURCAD, EURNZD, EURAUD, EURGBP. After completion on the long/long/long JPY-pegged pairs, long/long/long the CHF-pegged pairs and short/short/short the EUR-pegged pairs and closed as their interest rate differential prices already reached then followed by the short/short/short for the NZDUSD, AUDUSD, GBPUSD, EURUSD (long USDCAD). At such, interest rate differential prices trading is a "non-stop trading operation" around the clock. This is likely could be identified by "interdays technical charting".
Mar 02
Comment: By rule of thumb mutually agreed by the global economists and the monetarists, the FX prices to move from equilibrium exchange rate at economic fundamental (disequilibrium) to equilibrium exchange rate at interest rate differential (equilibrium) according to equilibrium exchange rate theory. However, the global currency pairs interest rate differentials are mixed by the interest rate policy of the global banks. The mixed interest rate differentials of the global currency pairs to pressure the global monetarists (central banks) to mutually agree to certain levels by the target zone theory and result the agreed policy of Plaza Accord, Louvre Accord, EMS Treaty by developed nations.

Emerging markets, developing and under developing nations may not qualify for Plaza, Louvre and EMS treaty and result the introduction of global monetarists consensus on target zone, thus target zone theory endorsed by four policies, the Plaza, Louvre, EMS and monetarists.

dificulty faced by the equilibrium exchange rate theory on the measurement at what exchange rate the equilibrium exchange rate at economic fundamental (disequilibrium) and at what exchange rate the equilibrium exchange rate at interest rate differetials (equilibrium) by the mixed interest rate differentials of the global currency pairs ?. This is resolved by the introduction of currency band theory, the tool to be used for measuring the lower and the upper ceilings/bands of the target zone at mixed interest rate differentials. Thus, there are two currency bands, (1) the time series currency band for measuring target zones (medium and short target zones), medium term target zone also known as medium term directional trend and short term target zone also known as short term directional trend. The short term directional trend is the result of sterlization interior the medium term target zone (sometime called large pullback or large rebound), (2) the time series interest rate differential-based currency band as the baseline for measuring the interest rate differential prices on annually, semi-annually, quarterly and monthy at current interest rate differentials. Monetary policy on interest rate usually made public on monthly thus monthly is the shortest period for FX price measurement by currency band.

Thus, time series interest rate differetial-based currency band is the tool to measure what is the equivalent price of AUDUSD, AUDJPY, AUDCHF, EURAUD and other at lower ceilings and at upper ceilings, to include all developed nations, emerging market countries, developing and under developing countries currencies. This equivalent rates are also called weighted rate or average weghted rates or relative prices (do not mixed with the weighted prices measured by central banks in relation to global trade on export-import, they are different).

Interdays is interior the monthly ceilings/bands the terriitory of trading for FX prime dealers to trade. They are also measured by their interest rate differential prices by their weighted rates. Technical traders seem to indetify this interdays by using 15M and 10M technical charts interior the monthly ceilings/bands. The risk of this interdays however can only to be mitigated by accurate measurement of their weighted rates interior their monthly ceilings/bands.

THUS, currency band not Bolinger band. Bolinger band introduced by Bolinger and currency band theory introduced by Paul Krugman. Equilibrium exchange rate theory introduced by Williamsons, and the target zone theory introduced by Williamsons and endorsed by the policy with Plaza, Louvre and EMS. Global monetarists endorsed the theory by global monetarists consensus, specifically for non-developed nations.
Mar 03
Comment: RBA, BoC and the ECB are projected to hold the current interest rate. Despite of slowing inflation risk, the BoC is projected to hold interest rate at 1.75 %. Therefore, long JPY-pegged pairs resumed and will be resumed.

The weigted rates to USD-pegged pairs, CHF-pegged pairs and EUR-pegged pairs are in harmony and sligthly mixed therefore risk on prices adjustment may not exceeding 100 PIPs price elasticity.
Mar 03
Comment: The Bank of Japan left its key short-term interest rate unchanged at -0.1 percent at its January meeting and kept the target for the 10-year government bond yield at around zero percent. At the same time, the central bank revised down inflation forecast for fiscal 2019 to average 1.1 percent from an earlier projection of 1.6 percent, mainly due to a decline in crude oil prices and worries over global economic outlook.
Mar 03
Comment: Bank of England policymakers voted unanimously to hold the Bank Rate at 0.75% and indicated that there would be fewer increases in borrowing costs in 2019 as the UK economy faces the weakest economic growth in 10 years amid persistent concerns about Brexit and a global slowdown. The central bank lowered its 2019 economic growth forecast to 1.2 percent from its previous estimate of 1.7 percent while inflation is expected to decline to slightly below the MPC’s 2 percent target in the near term, largely due to the sharp fall in petrol prices.
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