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Author: @faithmight

Lydia Idem is an investment advisor who has been an investor and trader for 23 years. She has been a special guest on TD Ameritrade Network and Benzinga’s #PreMarket Prep Show; featured in FORBES Magazine and CNNMoney; and co-author/contributor to The StockTwits Edge and Trading: The Best of The Best. In 2014, she launched FM Capital Group LLC, a registered investment advisory firm serving people of color. Lydia was recently named #22 of the Twitter Accounts Investors Need to Follow in 2017 and #3 of the Top 10 Women To Follow In Finance for 2015. Lydia has a Master of Science in Management (Georgia Institute of Technology) and a Bachelor of Science in Computer Science (Vanderbilt University). Follow me on Twitter: @faithmight Follow me on Instagram: @faithmight Follow me on Facebook: fb.com/fmcapitalgrp
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Sterling Digest, May 10 2012: NO QE4

The Beautiful British Pound Sterling
Beautiful trend in sterling continues on

The euro sank this week as the Eurozone became unhinged in political elections that ousted leaders who led the charge for austerity. $GBPUSD followed in sympathy but today’s BoE decision to hold off on another round of quantitative easing (QE4) has lifted sterling across the board. As with any strong trend, the contrarians are circling. Many bears are out looking to short sterling especially in $EURGBP and $GBPUSD. But this bull trend in sterling is not one to step in front of. Don’t fight the flows!

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Sterling Digest, May 4 2012: NFP preview

JOB Toulouse
Jobs remain important catalyst for markets

The spotlight event of the month for the forex markets is today’s US NFP release. As USD sentiment seems to have shifted to fundamental flows rather than risk flows, a disappointing number could weaken the USD. $GBPUSD has found support at 1.6160 all week. US NFP should be a catalyst for further correction or a continuation of the bullish trend.

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Sterling Digest, May 2 2012: European dealings

collage of the economist covers featuring the euro
Euro woes benefit sterling

$EURGBP has broken to new yearly lows in today’s trading as sterling continues to gain against the euro. UK economic data continues to come in mixed but, despite the consensus, PMI numbers above 50 suggests the economy has signs of strength.

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Sterling Digest, May 1 2012: the doves rally sterling

The rather dangerous, The Economist cover
The political reason the ECB turns dovish

Everybody knew that the RBA was set out to cut interest rates. But the RBA surprised the market with a much bigger than expected cut of 50 basis points. $GBPAUD rallied hard after the announcements and remains over 100 pips above its pre-RBA levels. The ECB also delivers an announcement on interest rates this week. The ECB is also expected to be dovish as the central bank shifts its focus off the banks and on to their economies. The $EURGBP remains below 0.82. Can sterling continue its rally on dovish sentiment from other central banks?

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Sterling Digest, April 29 2012: bears want in

One pound coin
One pound coin

After such a bullish close to the week, it seems almost natural that sellers and sterling bears start piling into the market looking for their next opportunity at these higher levels.

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Sterling Digest, April 28 2012: weak sectors can’t stop sterling

House and UK Pounds
UK housing market may still be weak but sterling sure isn't

$GBPUSD slaughtered bears today as it charged to new yearly highs to close the week above 1.6250. That’s a bullish statement. The nice thing about this trend is that there have been corrections along the way so it is hardly overbought. And while this rally started in the midst of UK QE3, now that the central bank has turned hawkish there may be no stopping this sterling rally. Despite what you may think about the UK economy, it is the central bank’s turn in sentiment that strengthens sterling right now. And that makes this rally for real.

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Sterling Digest, April 26 2012: double-dip musings

UK : 20 Pounds : Reverse
Manufacturing written on the money. It's that important.

There is so much commentary about the British economy following the release of official data that revealed the UK economy is in a double-dip recession. Traders, however, look ahead to the Bank of Japan rate announcement for whether the $GBPJPY remains supported above its major psychological level at 130.00.

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Sterling Digest, April 25 2012: market follows central bank not economy

Mark Prisk, UK Business Minister
UK companies are backing a new Government campaign to highlight the best of modern British manufacturing at an exhibition during the Olympic Games. Will it work?

It was the hawks versus the doves of the BoE and today the hawks won. Even with the UK falling into a double-dip recession, the BoE has already told the market that the economy is actually stronger than the number would reveal. They are ignoring today’s GDP release. And the market followed suit with new yearly highs. We noted yesterday that any sterling weakness on the back of a disappointing GDP number would be temporary. Coupled with Bernanke keeping the door open for QE, $GBPUSD bulls remain well supported above 1.60.

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Beware Trade Tips

Especially when it comes from Goldman Sachs:

The mighty Goldman Sachs has apparently recommended selling EUR/GBP at 0.8210/20 with a tight stop of 0.8250 and targeting a move back down to 0.8150/60

Since Goldman Sachs wants to make trade recommendations, why don’t we all make some? Here is mine:

GOLDMAN SACHS IS LONG EUR.

Do what you will.

 

screen shot of my twitter stream at 2:20ish am pacific time
I LOVE my Twitter stream

 

Source: Trade Recommendation… (Forex Live)

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Sterling Digest, April 24 2012: the moment of truth

Is another recession on its way?

Wednesday may be a moment of truth in this sterling rally that has taken hold since the beginning of the year. Though the Federal Reserve announces its decision on monetary policy tomorrow, sterling traders have their eyes on the UK GDP release earlier that morning. But the Bank of England has already dismissed the GDP release. The BoE gives inflation trends more weight than the economy when setting monetary policy. So on disappointing GDP expect sterling to weaken, but that move lower may only be temporary as the market discounts GDP much like the BoE already has.

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