Canadian Dollar CAD FXC HDD HDU

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#1 Sat, Jun 25, 2011 - 3:17pm
humahuaca
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Canadian Dollar CAD FXC HDD HDU

CAD broke decisively below 1.02 during NA trading, finally, after many attempts. It had broken lower in euro trading a few times, but always roared back as soon as NA trading started.

I covered some of my short CAD position at 1.02, as that had always worked before, but not this time!

Since then, I have continued buying slowly, and will buy some more on Monday if we get under 1.01, and I would back up the truck at par.

This is just a short term trade, and my plan is to sell my CAD at 1.02 on the rally I expect once Greece passes the austerity program on Tuesday.

Since CAD follows oil and the S&P, depending on the day, I also play around with HOU and HOD on the TSX. I had bought oil (via HOU) at 6.03, but since sold that and reversed, am now short oil (via HOD at 7.42) It's just a small position, and I expect I will lose on it on Tuesday as oil rises with the Greek news, but I now see that as a great chance to short oil, I think we'll see $85 easily.

I'll add to HOD from 7.42 to 7.00

I don't expect CAD to break below par anytime soon, but it's possible if S&P crashes, as it might. I just don't think it happens yet. The Greek event has been pushed back another 3 months, so lots of time to rally before the inevitable crash.

Edited by: humahuaca on Nov 8, 2014 - 5:15am
Sun, Jun 26, 2011 - 8:16pm
CK
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Good to see you back on here 

Good to see you back on here Huma, finally someone to talk CAD with.

Last time it went around 1.01 it shot right back up... this time is a little different. End of QE2/ Rising dollar is at the forefront now. We will clearly have somewhat of a bounce back up soon, but not as strong as the recent times. 

The next few days I think we'll see the dollar continue up, then it will come down and all commodities/currencies will rally for a small time period. This is what I'm hoping for. Very bullish on dollar for the rest of the summer. Sort of expecting a much weaker CAD by mid August.

The S&P will definitely get destroyed. Any big jump/ loss in the USD will be a great chance to start shorting for the summer. Just my 3 cents.

We're not trading against the market, we're trading against ourselves.
Sun, Jun 26, 2011 - 9:01pm
HappyNow
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What are your thoughts on

Where the Cdn gov't wants the CAD to sit?

I believe that anytime it goes above 105 actions will take place to move it back and frankly anything above 103 will be at least 'bumped' back in the right direction. The cost to Canada is just too large to break further from the largest trading partner. OTOH anything lower than 102 won't be addressed and global traders determine the outcome.

Not saying Canada is strong enough to force their dollar anywhere except a lower value compared to USD. eg. can't 'force' it higher without drastic domestic implications.

Swing trade indexed ETFs. Long physical gold, silver, and 1 miner.
Mon, Jun 27, 2011 - 10:13am
humahuaca
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@ CK and Happy

CK. I pretty much agree with you, I will definitely sell the CAD I have on the rally I hope to get in the next few days.

After that, I think we will could test par anyway, somewhere down the road. I am well long USD, and only taking profits here and there, always trying to improve my average, but I am not used to being patient to buy CAD, now I am learning to be.

Happy: I don't think anyone in canada wants the loonie over 1.05, and certainly not Carney, but if we get more inflation here Carney may have his back against the wall. If inflation eases off, then yes, we could see a much weaker loonie .

I think the general consensus is 91 cents is about right...but I have serious doubts that we will see that, UNLESS we get a global financial collapse, which certainly is a possibility.

Mon, Jun 27, 2011 - 10:25am (Reply to #4)
CK
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So you're ready to ride it

So you're ready to ride it back to 1.02 from here.. probably the right play.

We're not trading against the market, we're trading against ourselves.
Mon, Jun 27, 2011 - 12:28pm
humahuaca
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yup I think I'll get a chance to sell at 1.02

might even see that tomorrow?

It will be interesting to see if it goes above 1.02....I hope not, but it could happen if we get the expected good news from greece.

Still, longer term I feel good being short CAD, as I think the odds of financial collapse go up over time.

Wed, Jun 29, 2011 - 2:54pm
humahuaca
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sold all my CAD

Just sold off the last of the loonies I bought on monday and tuesday at a much better level than I thought I would get.

Now I'll sit out and wait for 101 area again to buy in. I will be tempted to buy at 102, but going to try and be patient and really load up at 101.

Wed, Jun 29, 2011 - 7:43pm (Reply to #7)
HappyNow
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Nicely done! This is getting

Nicely done!

This is getting to be more reliable than the silver trade for sure.

Swing trade indexed ETFs. Long physical gold, silver, and 1 miner.
Thu, Jun 30, 2011 - 10:19am
humahuaca
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thanks Happy

but in hindsight I sold too soon!

what else is new...

Looks like that dip in the loonie was all about Greece and the oil price drop, both of which seem to be 'over ' for now, so we'll probably see the loonie run back up to 1.05. Should have very good resistance there though. 

I'm not going to buy CAD here, I'm stepping away for a while and going to enjoy a little vacation. I'll wait for either 1.05, where I will sell some calls on FXC, or for the next crisis, where I'll buy CAD at 1.01.

You're right, sure is a lot easier than silver! Moves are not as big, but you can take bigger positions to get the same result. I avoid silver as I really don't understand it (it's the nat gas of the metals if you ask me). I dabble in gold sometimes, just not recently.

If I can just be a bit more patient I won't have top do much else than trade CAD, but easier said than done, and I get bored, so I dabble in the S&P and oil, a few stocks.

Hope you made a few $$ too this week.

Cheers.

Fri, Jul 1, 2011 - 4:02pm
humahuaca
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just sold some FXC calls

I can't believe how quickly CAD has risen, wow. I thought we could see 103 or maybe 104 easily enough once that vote passed and everyone got all bullish again, but it sure happened a lot faster than I expected.

I just now sold 10 FXC 103 calls, not a big position, just thinking we should get a little pullback next week as we get closer to the employment report.

I'll wait for CAD to get to 1.05 to add to that position, or I'll buy some deep ITM calls on a pullback.

Fun times. I am more convinced than ever that volatility will continue, and you are better off to wait for 2,3 or 4% swings, no matter what you are trading, it's all crazy now.

Tue, Jul 5, 2011 - 3:35pm
HappyNow
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Anybody trading it today?

I was all over silver and enjoying a sunny day. Forgot to pop up the CAD/USD chart for a peek until now.

Still a great trade wish I hadn't put all the money I'm willing to risk right now on silver shorting.

Swing trade indexed ETFs. Long physical gold, silver, and 1 miner.

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