18.12.2013

<span style="text-decoration: underline;"><strong>1. INTRODUCTION:</strong></span>

It is a huge news event later today so I wanted to place my thoughts on paper.

My gut feeling is that there will be NO TAPERING announced to day, but I do think that there will an announcement of when it will start and with this alone  it represents a huge change in FED monetary policy.

The initial response from the markets if my scenario plays out is that the USD will weaken. After the news hits home, the realization that TAPERING will start soon will then result in the USD strengthening. Basically, there will be a "Knee Jerk" reaction then a reality pill will be absorbed.

My "FLASH" trades below are based upon the reality pill being absorbed!

FLASH TRADES are trades for which there is no limit order placed with my brokers but these are trades I want to enter if the entry prices detailed below are hit. I will tweet my entries as soon as possible after entering trades.

<span style="text-decoration: underline;"><strong>PLEASE NOTE: If no forward guidance on TAPERING is given I will NOT take these trades, except possibly the "NO TAPERING" long AUD/USD trade.</strong></span>

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<span style="text-decoration: underline;"><strong>2. FLASH TRADE SET-UPS FOR USD MAJORS:</strong></span>

<em>Any trades I enter based on the set-ups below will be small to establish initial positions. If the FED announces a major policy decision change today, this should set up USD strength for the foreseeable future and therefore this will allow us to build trades. Do not be too aggressive take your time and build a trade or two for the long haul.</em>

<strong>EUR/USD:</strong> I think after the initial statement release we may see this pair rally above 1.3800 towards 1.3830. Basically, the higher the better. I want to short this pair above 1.3830. If the momentum move above 1.3800 is very strong I want it to let run the stops above 1.3830.  If it breaks 1.3950 heading to 1.4000 on a massive momentum move, which I strongly doubt, my whole fundamental view on the market has gone in the trash.
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY SHORT: 1.3830-1.3850</strong></span></p>
<p style="text-align: left;"><strong>GBP/USD</strong>:  Again, after the move up I am looking at as close to 1.6465 as possible to possibly short. I am NOT a major fan of this pair and after excellent Unemployment Data this morning, plus Carney's quote of low rates until middle 2015, I may just shy away from this pair.</p>
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY SHORT: 1.6450-1.6475</strong></span></p>
<p style="text-align: left;"><strong>USD/CHF</strong>: This pair represents great value on a risk / reward basis if picked up around key support at 0.8840.</p>
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY LONG: 0.8830- 0.8850</strong></span></p>
<p style="text-align: left;"><strong>USD/JPY:</strong> Not interested in this pair at all.</p>
<p style="text-align: left;"><strong>USD/CAD:</strong> Last night unfortunately it stated to come up from much lower levels. So this is a "Buy the Dip" trade. 1.0650 should hold it prior to FOMC and then an initial dip to buy and then we should be off much higher through 1.0700 if scenario plays out.</p>
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY LONG: 1.0580 - 1.0620</strong></span></p>
<p style="text-align: left;"><strong>AUD/USD</strong>: Do not fight the RBA. I really want to get short this pair today. But it has to be on my price. If my scenario does not play out today and this pair rises though 0.9000 it looks on the daily chart that we could be in a triple bottom measured move to 0.9470 or thereabouts. A 500 pip or so move. Therefore we have a double option trade with this pair.</p>
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY SHORT: 0.9030-0.9060
</strong><strong>IF NO TAPERING AND WE BREAK THROUGH 0.9000........possible triple bottom long trade in play to around 0.9500</strong></span></p>
<p style="text-align: left;"><strong>NZD/USD</strong>: On the daily chart we are in wedge pattern that is getting tighter each day we move forward. The breakout levels are 0.8200 to 0.8280. These levels would be great for a normal day but after the "Knee Jerk" are the levels that I am interested in and today we could create a false breakout to the long side.</p>
<p style="text-align: center;"><span style="text-decoration: underline;"><strong>TARGET ENTRY SHORT: 0.8320-0.8350</strong></span></p>
<p style="text-align: left;">Just because I have listed levels across all the USD majors except the USD/JPY above, it does NOT mean that you should take or attempt top take ALL the trades. Pick just the pair or pairs that you are used to.</p>
<p style="text-align: left;">I will tweet all my entries as soon as I can and I will summarize my set-ups towards the end of the trading day. Please take it easy and be careful, as we are entering some very thin trading days, you will need wider stops to start with.</p>
<p style="text-align: left;">Good Luck, if you decide to trade.</p>
<p style="text-align: left;">Scott Pickering
The Pip Accumulator
Wednesday 18th December 2013</p>
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