Fooled by Confucius

Never have I thought the roots of confucianism was so deeply embeded in my way of life and thinking. Maybe I was wrong, maybe I did not realise this soon enough, maybe it was just a way of life that I got so used to growing up.

One cannot deny that humaneness(仁) is a central theme of confucianism, using "a" as what the central theme actually is is still open to interpretation of many. Being humane means to be able to consider ones actions as to not cause harm to others. This reminds me of an anecdote I heard when I was young.
If somebody slaps you in the left cheek, what would you do? Jesus would ask you to turn the other cheek around so your right cheek will get the same equal treatment. In current standards, that would probably wage a war, let alone allowing the opposition to give you another slap.

What if?

What if you are the one slapping instead of being slapped, lets say by accident (just because you believe in confucianism) ?

Do you wait for retaliation (in which you are inviting the opposition to break his believe in confucianism)?

Do you slap him in the right cheek (in which you break your believe)?

Do you apologize profusely or just walk away quietly? (which I believe should be the best solution but again is up for interpretation)

Putting this in a political context, a ruler who acts inhumanely will lose their mandate to rule. If confucius is right, then those who attack oppositions or those inviting oppositions to retaliate should already lose this mandate.

Then again, only time will tell if confucius is right, or was I fooled by confucius?

Day 1: Fundamental Analysis

My plan is to stick with EUR/USD and try to get something from there. I currently have a system which I will reveal when I have the time to do so. So let's start with fundamental analysis for Europe and US.

First of all, the biggest news yesterday was the 50 points Fed cut which spurs equities to rally upwards. Sad to say it is bad news for the USD as it EUR/USD (from hereon called "euro") soars. Markets are currently in consolidation on uncertainty after the rush yesterday. As can be seen here on the USD/JPY (from hereon called "gopher").
Look at the latest movements. The sudden spike was due to yesterday's rate cute of 50 points and then it cools off with a little of correction before moving sidewards with no clear direction of where to go. I am of course not trading on gopher but looking at how both stochastics and RSI linger around the midpoint is a clear sign of market consolidation.

I suspect all we need is a good news for the price to suddenly go up or down. I suspect that global equities rising leads to weakening of the yen but we'll see the full extent with a bit more time to come.

Back to the euro, now that we know people are uncertain about how the USD is relative to the JPY, we could say people are uncertain about whether the USD is overpriced or underpriced. It all depends on the euro. Let's look for signals, from fundamentals (i.e. news articles).

Here are some which I think might be relevant.

1. Belgium break-up fears.
   With no new government for 101 days after their general election(good grief), concerns are growing that the country will finally split up. Uncertainty is not good for euro right now, as it casts doubts of a "united europe". No doubt about this.
   
2. Greenspan casts doubt on publication of inflation goals
   "They will have to go through a tricky process of explaining if inflation deviates from target" Quite true, but I don't see how this affects the euro.
3. US housing market outlook worsens
   Tricky this one, since the crash is not yet evident. It's going to be bad for the US economy as builder sentiment fell for the 7th consecutive month. Bad, but still waiting for the crash to actually happen.
4. Clouds gather in Germany as sentiment sinks
   New data added to evidence that the best of Germany's economic revival was over, although economists did not expect a sharp decline in performance. Bad for euro, since they are still uncertain whether Germany's recover was TRULY over.
5. Dollar plunges to new low versus euro
   Reasons: fed cut on interest and discount rates, UK inflation fell below BoE's target in august, Northern Rock crisis to have lasting effects on consumer confidence.
   

I think those are the relevant news. Nothing really significant but it shows a probably weakening euro in the long run and an unpredictable USD.

Day 0: Beginning of a new trade

So I've been talking about forex for a while now. Since the investment club plan is put on hold for the moment until the preliminary meeting, I've decided to explore trading in the forex market.

I'll try to explain what I've come to understand so far.

Forex = Foreign exchange

Forex trading is done by trading on a pair of currencies. The big 5 currencies traded are USD (US dollars), GBP (Great Britain Pound), EUR (Euro), JPY (Japan Yen) and CHF (Swiss Franc). There are some other traded currencies as well but because of the size of their economy to be comparatively smaller than the above mentioned, I shall for the time being avoid them.

In layman's term, forex trading is more or less like trading the economies of a country compared to the other. For example, I would buy (go long) on GBP against the USD if i think the british economy is progressing, or the american economy is regressing, or both.

It is not always this simple though, as there are many factors that can determine the strength of the currencies.

If you are interested at this point, simply head to BabyPips to learn more. It's a lovely and informative site, take my word for it if I say it's the BEST forex site for beginners.

Let's get started right now as I start a strict trading regime. But before all that, just a little comic to calm the nerves.


He is in fact wrong, money can buy happiness, but that depends on what type of happiness it buys. If you're talking about fast cars and the adrenaline rush then you have an idea of what I'm thinking. So the aim of my trade is of coz to make money (fake money but still as important nonetheless, it's my pride)

So here's the brand new account with USD1000 and a leverage of 1:100, which means I have USD100,000 to trade but could lose money A LOT faster than a 1:1 account, double-edged sword this is.

I shall talk about my plan next.

Euro Yen Power

Did I say 159.85? It's going towards 161.00 now.

13 Sep 2007 14:19 GMT

BULLET: EURO-YEN: Breaking through tech resistance at MNI....

EURO-YEN: Breaking through tech resistance at Y159.97/00, MNI Techs
suggesting a close above this level would be a positive sign. Stops
going off now, with little seen on the orderboard until offers around
Y161.00.

Looks like I can cover my losses today, not a bad trading day I would say. So many things learnt, still it never ceases to amaze me the market can move on absolutely "NOTHING".

Forex, Khairy

Started doing a little demo trade on the forex market in 2 eventful days. DEMO only, hehehe guess I don't have that much confidence in trading real money. And I can see why people always say try it on a demo account first, it's really risky, much riskier than equities.

First, Oil barrel reaching US$80 per barrel, and second, EUR/USD hitting the wonderful 1.39 mark, seems like it's going to hit 1.4 soon.

Also, fingers crossed for EUR/JPY to hit the 115.85 mark so I can earn some more $$$.

Anyway main news today is this.

Love him or hate him, he's a daddy now. Congratulations.