My position in Japanese Yen has made a return so far as I am still short in Yen and will stick to my position for some time till I see a turnaround in the market. Haruhiko Kuroda – Bank of Japan of Governor said that the bank will not stop bond purchases which should give support for weakening yen. Furthermore, rising oil prices have an adverse effect on Yen as the country being the huge oil importer. I will be waiting for the next BOJ meeting on Nov 1. ECB furthermore will probably keep its bond purchases as it will announce in December. As the Union is still in trouble by low inflation, high unemployment and lower economic growth.
However, my put options contracts for S&P 500 ended worthless as market rallied in the past 7 days. I think as Presidential Election is coming close ( 8 Nov 2016), market is staying optimistic about the election. The past few weeks have been hard on Trump as many allegations have come forward against him on women issues, his chance of winning has declined substantially. As Clinton is ahead in the polls, the market will accept her presidency as a stabilizer. Few weeks ago, it would be hard to judge the winner but now I think it is more obvious. However, a bit doubt needs to be in place. I did not expect Brexit in the summer at all, as neither did polls, media, political leaders , 52 % voted YES to leave. So, if more Trump supporters get and vote his chance of winning can not be ignored. Therefore, I will be cautious on US stocks these days. I will buy SP500 futures however at a portion that will not hurt my portfolio.
I made a return on my Crude oil futures as oil inventories fell and Crude oil was at 1 year high.
I wanted to do a trade on Pound sterling by going short, however, few days later I realized my orders have not gone through. I was lucky though, after pound falling rebounded straight up.
Saudis issued debt around $17 bln and still investors are optimistic about OPEC deal. November OPEC meeting will reveal everything – either oil will sink or go up. Despite oil being at 1 year high, I will increase my positions in oil (my contracts have expired) . But not too much as there is still uncertainty about the meeting.
My thesis has changed slightly from a week ago, as I will reverse my positions on US stocks and in pound sterling. I will keep Yen short and be bullish on Oil.