Hey folks! There are two comments I would like to make in concerns to the USD/HKD. The first is that it is October 20th, 2008. Look at the initial post ... October 21, 2007! Now I dont know about you ... though I dont believe this is coincidence. I wasnt aware what date I made this thread, I just have been keeping an eye on the HKD. Perhaps it is simply by chance and I am just tapping into theories that I shouldnt, but this is by far (considering the allowed range) the closest that this pair has gotten to the boundary the entire year. The spike that occurred in March of this year was too fast, I didnt catch it. This is more significant.
The second comment I would like to make is that I checked my own link from a year ago and the HKMA still has it as its policy to not allow the Hong Kong Dollar to go beyond the 7.7500 barrier. This means, just like last year, when we make a trade around this point we really do have a 3:1 R to R ratio. This is fairly good, clearly. If you have a positive, or at least near neutral swap on this pair ... TAKE THE TRADE! You dont get a government backing too often in this market, the HKMA is telling you what they will do.
Further, if you lose the trade that means that the boundary has been broken and the HKMA cant do anything about it. This means that you are in essence watching a MAJOR breakout occur. Not a technical breakout, you are watching a government financial institutional relinquish its strength. Could we then see the HKD move all the way to the CNY level? Theories are abound, no point in over speculation, though it will surely be a moneymaking opportunity either way.
The Trade
I use Oanda and the rates are pretty close to even. Spreads lately though with the broker are worth ____. I will purchase at 7.7575 (roughly) and set a SL for 7.7450 with TP of 7.8000.
Good trading,
The second comment I would like to make is that I checked my own link from a year ago and the HKMA still has it as its policy to not allow the Hong Kong Dollar to go beyond the 7.7500 barrier. This means, just like last year, when we make a trade around this point we really do have a 3:1 R to R ratio. This is fairly good, clearly. If you have a positive, or at least near neutral swap on this pair ... TAKE THE TRADE! You dont get a government backing too often in this market, the HKMA is telling you what they will do.
Further, if you lose the trade that means that the boundary has been broken and the HKMA cant do anything about it. This means that you are in essence watching a MAJOR breakout occur. Not a technical breakout, you are watching a government financial institutional relinquish its strength. Could we then see the HKD move all the way to the CNY level? Theories are abound, no point in over speculation, though it will surely be a moneymaking opportunity either way.
The Trade
I use Oanda and the rates are pretty close to even. Spreads lately though with the broker are worth ____. I will purchase at 7.7575 (roughly) and set a SL for 7.7450 with TP of 7.8000.
Good trading,
The market is my nation. Traders, my family. Hello, brothers and sisters!