I'm irreversibly lost...

I'm irreversibly lost...
来源: Lq2004 于 06-11-30 16:22:57 [档案] [博客] [旧帖] [转至博客] [给我悄悄话]


Today is a bloody, shitty, painful and disastrous day for me. I lost tremendously in the FX market. Everything has been gone and over, although I'm still reluctant to recognize the unfortunate aftermath. What just happened? I tried to figure out the path but it appears so obscure and becomes even more...

USD has been hit since early last week, primarily due to long-term worry or expectations that Euro-zone and Japanese economies are getting stronger and countries like China may diversify USD into other currencies as a portion of their trillion-dollar foreign reserves. Of course, all the info are USD-negative. However, considering the dollar high pushed by excessive speculation weeks earlier, certain reversals are quite reasonable. But those reversals theoretically shouldn't be overwhelming, in light of the primarily healthy fundamentals of U.S. economy.

However, see what happened in the real: the market has been continually hammering down USD in the past two weeks, forming a clear downturn trendline which is extremely unusual. Up to early this week, USD has reached the lowest against other major currencies over the past 2-3 years. So, should that be an inviting entry point? I believe so! Indeed, I've been patiently waiting for the bottoms since two weeks ago and didn't move at all. I started to buy dollar (or short other currencies) slowly this week and accumulated positions at historical USD lows. By last Wednesday, I felt the speculation against dollar is almost in the end and bet large amounts on dollar rebound. And as expected, dollar did come back nicely yesterday and I had decent unrealized gains in my account. I even hesitated: should I close the positions and catch the birds in hand? Finally, my judgment and the market concensus convinced me that: I should hold the positions and wait for today's bigger dollar reversal.

Surprisingly, this morning the market overreacted to a few unfavorable U.S. economy news and speculated the dollar to another historical low not seen in the past years! I was hit most by cable, which is like flying against dollar. I made all efforts to maintain my positions, in hope of breakeven later on by giving out a smaller portion of loss. But very unfortunate, the cable seems like being added four engines and can't stop. Finally, all my margins were used up and I have to cut off all positions! I, as a fighter, stood in the battlefield till last minute, but retreated almost dead. It's bloody, cruel and unbelievable...

What did I wrong? I'm wrong because I over-estimated the market, I thought the market should be efficient enough to adjust imbalances. I'm wrong because I under-estimated the speculators, I thought their greed against dollar can't last long. I'm wrong because I'm over-confident about myself, I thought my patience with timing of entry and cautious optimism about dollar should be rewarded. I'm completely wrong!!!

In one word, I'm lost because I failed to discern how long the market irrationality can stay. I'm out of the market because I'm not irrational enough. Is that insane?!


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