Stock Ideas arrow Investing Ideas arrow Is the Loonie Ready to Rumble… or Tumble
Rating
Click for Help

Market Watch

$130 Oil Signals Doom for the Transports
It seems like the most intuitive of trading theorems: Shippers use fuel to move goods and people around the world, so when oil skyrockets, the cost of shipping shoots up, too.
More...
 

Login Form






Lost Password?
No account yet? Register
Is the Loonie Ready to Rumble… or Tumble
User Rating: / 0
PoorBest 
Thursday, 10 January 2008
The Canadian dollar (aka “the loonie”) has enjoyed a remarkable run-up over the past 12 months, driven by skyrocketing oil and gold prices. (Canada’s got great big bunches of both hot commodities).
But Canada is also one of the U.S.’ biggest trading partners, and as such is not necessarily immune to the financial diseases afflicting our banks, economy and markets. As the contagion spreads across our northern border, you can expect the loonie to continue to peel away much, if all, of its 2007 gains.

Canadian Dollar Trust When we look at chart for the Rydex CurrencyShares Canadian Dollar Trust (FXC), we see an obvious top in early November at $113.02. But the true sell signal -- a move below the 11-week moving average accompanied by a reversal in the Money Flow Oscillator -- only hit last week.

While a complete breakdown to 2006 levels is possible (but not yet highly probable), you can expect this ETF to drop as low as $94.52 over the next six to eight weeks, with an extension to $92.14 quite possible.

My recommendation: Purchase FXC March 100 Puts (FXC OV), currently available for $270 with a delta of 0.52. Should the FXC drop to $94.52, you would be looking at gains of 90%. A drop to FXC$83.11 would push those gains to 310%.

Adam Lass
Market Analyst, WaveStrength Options Weekly
Source : Taipan Chart of the Day This e-mail address is being protected from spam bots, you need JavaScript enabled to view it

China Infrastructure: God or Country

By Andy Carpenter Dear Reader, The concept of impermanence can drive a man crazy.  It can cause him to lay awake each night and wonder which thought will be his last. Add that to a biological...
+ Full Story

Tuesday is Fat with Economic Reports

By Rick Pendergraft Everyone will have their eyes on the Fed tomorrow, as another 50 basis-point rate cut is expected.  The more important part will be the policy statement going forward. ...
+ Full Story


  • We endeavor to decipher analysis of this Teaser/News Letter to distinguish the thoughts of Authors/Editors.

  • Please post your Review/Comments, your rating helps other users gauge the value of an article ...

  • Was this service a Ripoff ? Click Here To Post Your Ripoff Story !


Bookmark and Share




RSS comments

Write review Your rating helps people guage value of an article
Name:
E-mail
BBCode:Web AddressEmail AddressBold TextItalic TextUnderlined TextQuoteCodeOpen ListList ItemClose List
Review:

I wish to be contacted by email regarding additional comments
Sorry but! We have to make sure that you are not a bot Please solve this simple math before you submit:
5L9         N43      
1 Q    2    X P   47L
J D   KPF   OHJ      
4 C    G    B 9   1O8
SW2         X9E      

 
< Prev   Next >