Well I know that some of you may be wishing that I’d talk about something other than $USDRUB but its been another couple of amazing days in the currency pair. (See here for my earlier posts on USDRUB) Yesterday was a 10% drop which caused the Russian Central Bank to increase interest rates from 10.5% to an eye-watering 17% overnight. This is usually unheard of. And is normally associated with stopping any further depreciation in the asset and in fact an accumulation of capital into that instrument.
However for whatever reasons its had the exact opposite effect today with a move of approximately 2000 pips in one day and a drop (I reckon by my dodgy rule of thumb) of around 20%. Such was the weight of selling Rubles that they had to halt trading at one point. I don’t necessarily think it was dollar strength as opposed to more Ruble weakness. Was the interest rate jump enough to spook the markets? Was it enough to spook people to get their money out of Russia as quickly as possible? Only time will tell. (As I write this I see Apple have closed down sales in their online Russian store due to the Ruble trouble.)
So what happens tomorrow? Well to be honest it could be up 10% or it could be down 10% tomorrow. No-one really knows. I certainly wouldn’t be a buyer of Ruble just because I thought the selling was over done. It strikes me that this is a concerted attack on Putin.
I can’t help but think that Vladimir Putin is sat in the Kremlin this evening, head in hands, silently sobbing into his vodka as he sings the Elvis Presley song “It’ll be lonely this Christmas….”. He is as the photo suggest now to be known as ‘Sadimir Poutin’ (sorry, I couldn’t help myself.)
To be serious (for a moment) it does worry me that this guy is getting battered right now. He’s sitting on a great deal of personal wealth and quite a stockpile of weapons. I did wonder whether the failure of the NATS Air Traffic Control system in the UK last Friday might have been a cyber attack based on his petulance. (Please feel free to set me straight on that – happy to be corrected.)
On the upside it also made it an interesting day in indices and yen pairs. To paraphrase a good Trader friend he said “it was a real risk-on-risk-off-roller-coaster kinda day”.
I add in a photo of my Dax trades from this morning (just to show I’m not totally obsessed with USDRUB!) Two quick Domino Candle Longs after the false break of yesterdays low. (Part of the updated Wallachie Fan playbook that my clients will be getting as their Christmas present from me.)
Lets see what tomorrow holds!
Trade well….and try and get some sleep Sadimir!
Paul
FXTraderPauls Trading Adventures 
December 16, 2014 at 9:19 pm
Thanks for sharing your comments here Paul! I have to say – that must have taken some bravery to go long on the DAX at the bottom there, after the way it has been tumbling the past few sessions. Would you be happy to mark your entries and exits on the chart?
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December 17, 2014 at 3:55 pm
Hey George – thanks for the comment. It was always a quick reversal ‘jab’ of a trade. Here’s what I’ll do I’ll do a whole page on that trade detailing all the entry and exits levels as part of the updated Wallachie Fan Playbook which you should get before years end. Will that help?
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