USD/HUF - (massive) Long; Highest conviction trade since 2020!
Updated
This is a no-holds-bared, unmitigated, lock-and-load - and do it now! -, scenario. It does not get any easier than this, not even in the EUR/USD.
The Hungarian Forint is staring at a massacre, with immediate effect.
(... despite the fact that I applaud Victor Orban, the Hungarian Prime. Nevertheless, he has nothing left to work with. Simultaneously, he (still) is public enemy #1 for the EU - as member states go -, as well as in the eyes of the Biden administration. Now, the only remaining friendly country to Hungary, in Europe, is the Vatican. Orban courageously fought the good fight, all along, but, at least economically: "It's been nice signing with you Koko but ..." - It's over.)
p.s. Everything the western media had been spewing about Orban for the past 12 years lacks a single iota of truth. - Bet on it! The guy won 3 democratic elections with 2/3 majority which, even the communist slime-run EU, was forced to admit.
I will forgo the long version here and provide in lead words what matters here;
- Hungary is a tiny economy (10 million people), one of the smallest EU members; (IBordering with Ukraine and taking in the second largest number of Ukrainian refugees - after Poland - while the Kyiv continues to prosecute it's large, Hungarian minority.)
- They built the first wall on their southern border, which the EU never paid for - as they remain obligated to do so but likely never will;
- Hungary is 72% agricultural, lacking any and all energy (or other, primary) resources. E.g. It is 100% dependent on Russian energy - regardless how it gets there (indirectly from Russia at a major markup, very likely in the near future.)
- Hungary categorically refuses to support the EU madness or to go along with US demands to join the fight for the Ukraine; (Orban is no friend of Putin but he is also unwilling to crater Hungary's economy on a US/EU whim.)
- The Hungarian National Bank recently spent a significant portion of it's reserves to buy gold. The unfolding USD rally will likely temper any related enthusiasm;
- The EU is currently (punitively) the portion of EU funds due to Hungary for fiscal 2023;
-The Biden administration recently made it a point to go after Hungary (Orban specifically) "to enhance a regime change". (Wasn't that illegal, at least on paper? ...)
- Sunday's State of the Union by Orban is a potential call to arms in the West.
(One could write a book but) Long story short: The combined Western Alliance is about to lean into Hungary which is most unlikely to result in any economic, monetary or any other, miscellaneous national - or monetary - benefits.
Bottom line: There is blood in the water here so, start taking very big bites! - Long!
The Hungarian Forint is staring at a massacre, with immediate effect.
(... despite the fact that I applaud Victor Orban, the Hungarian Prime. Nevertheless, he has nothing left to work with. Simultaneously, he (still) is public enemy #1 for the EU - as member states go -, as well as in the eyes of the Biden administration. Now, the only remaining friendly country to Hungary, in Europe, is the Vatican. Orban courageously fought the good fight, all along, but, at least economically: "It's been nice signing with you Koko but ..." - It's over.)
p.s. Everything the western media had been spewing about Orban for the past 12 years lacks a single iota of truth. - Bet on it! The guy won 3 democratic elections with 2/3 majority which, even the communist slime-run EU, was forced to admit.
I will forgo the long version here and provide in lead words what matters here;
- Hungary is a tiny economy (10 million people), one of the smallest EU members; (IBordering with Ukraine and taking in the second largest number of Ukrainian refugees - after Poland - while the Kyiv continues to prosecute it's large, Hungarian minority.)
- They built the first wall on their southern border, which the EU never paid for - as they remain obligated to do so but likely never will;
- Hungary is 72% agricultural, lacking any and all energy (or other, primary) resources. E.g. It is 100% dependent on Russian energy - regardless how it gets there (indirectly from Russia at a major markup, very likely in the near future.)
- Hungary categorically refuses to support the EU madness or to go along with US demands to join the fight for the Ukraine; (Orban is no friend of Putin but he is also unwilling to crater Hungary's economy on a US/EU whim.)
- The Hungarian National Bank recently spent a significant portion of it's reserves to buy gold. The unfolding USD rally will likely temper any related enthusiasm;
- The EU is currently (punitively) the portion of EU funds due to Hungary for fiscal 2023;
-The Biden administration recently made it a point to go after Hungary (Orban specifically) "to enhance a regime change". (Wasn't that illegal, at least on paper? ...)
- Sunday's State of the Union by Orban is a potential call to arms in the West.
(One could write a book but) Long story short: The combined Western Alliance is about to lean into Hungary which is most unlikely to result in any economic, monetary or any other, miscellaneous national - or monetary - benefits.
Bottom line: There is blood in the water here so, start taking very big bites! - Long!
Comment
A Long entry anywhere here ...... provides effectively tight Stops. (Hence, my contention to "to load on this one", and to do it here.)
Comment
As I was pointing to;tradingview.com/news/reuters.com,2022:newsml_L8N32Q323:0-eu-approves-hungary-s-recovery-plan-but-withholds-cash-moves-to-freeze-other-funds/
I.e. Only expenses and no EU funds coming into Hungary - for the foreseeable future, if ever. Hardly conducive for a "monetary boom".
Comment
Just how much more of a cozy, superbly padded launching pad could one expect?! ...... For real.
Comment
ImportantMost recent Hungarian economic data;
- Inflation - annual rate: 15.48%;
- GDP: Q3 & Q4 (2022) was -0.7% and -0.4%, respectively = Recession;
- Housing prices - YoY: -20% (While listed but unsold units are up +50%, YoY);
- Employment: 0% change
Most importantly, Hungary had the tightest energy and food price caps in Europe, since the beginning of the Ukraine war. (All of Europe shops in Hungary due to the lowest price controls - Gov. price caps - in the EU.)
This had negatively impacted 55% of the state budget while, simultaneously, EU funds were frozen.
The country is now in Stagflation (1972-73 US style) that is rapidly gaining momentum. The double digit inflation shows no signs of leveling off - let alone subsiding.
E.g. While the EU (led by Germany) is in the process of committing Hara Kiri - in a spectacular fashion - Hungary is it's weakest member, leading the way for the rest of the EU. (I.e. Expect a 16% drop in the EUR/USD in the immediate future!)
Consequently, while the Euro is also "finished", for all practical purposes (for the long run), Hungary (an EU and NATO member state) is the practical example what to expect continent-wide, as of right now!
(That is what's meant by: "blood in the water".)
Comment
Chances are ...Comment
This is likely to double-tap the indicated support area before take off!In any case, this ought to happen rather swiftly (pin par?) then, off to the races - Long.
Trade active
Good Long Entry hereComment
Continue to be very Looong!!Trade active
Buy it up!Long
Trade closed: target reached
FLAT - for now.
This is only the first (of many!!) leg up!
(However, this one made the year, already. :-)
Trade active
Loading,loading, loading ... Something fierce! LONG
Comment
BOOM!! - Right on schedule. :-) Get ready to pare back on those Longs, for now.
Trade active
An absolutely massive LONG!!
Trade active
Here is the Entry Point - LONG;Trade active
The EUR/HUF ...... has finally arrived onto it's massive support - for a second time - for the retest. LONG!
Trade active
LONG
Comment
One would want to be careful here because of this;
It is quite possible that at the current, rampant 21.4% inflation rate the MNB (Hungarian Central Bank) could come out with a "surprise" rate hike, in which case this could spike down - Chart - to that major Stop Hunt, just below current levels.
There is massive support in the 325-328 area which will undoubtedly hold but it is also too close for comfort where major players (like the MNB) wont gun for it!
It's a wait-and-see at least for the balance of this week.
Comment
If, for some reason, one isn't Long, yet ...... this would be a place to establish some Longs - or to add to existing Longs -, with narrow stops and a favorable R/R Ratio!
Trade active
An excellent spot to ...... get LONG (if one isn't yet) or to add to the position, all with narrow stops here. (No need to risk much as this is a 1:12.5 R/R, here. Keep that ratio going at least until >252.50, even if this is just an addition to existing Longs)
Comment
Comment in the chart;The EU continues to (illegally) withhold development funds fro Hungary - continuously moving the goal post. At this point (9 months into it) chances
for the release of those funds are 50:50, no different as they were all along.
Note: A correction to the chart/comment above;
Where it says Keep that ratio going at least until >252.50 ..."
that reference number is clearly [u]352.50[/u] (Not 252.50)
Comment
This chart/pattern (EURHUF)... is also supportive of an upcoming Forint (HUF) weakness.
Comment
One wants to take this trade;LONG - This is a 1:12 R/R with correct, minimal stops!
Trade active
Definitely a massive LONG here!Nowadays; "Poland gets it for a prize what Hungary gets as a punishment."
Both are well despised by the European Union, except now Poland cares precious little with all the shiny new Dollars keep rolling in, as America's newest and best friend - and ally in the Ukraine war. (While the EU continues to withhold development funds from Hungary.)
Trade active
Massive LONG!! (1:24 R/R)
Comment
Trade active
This is one of the most promising ...... NAFTA vs. EU ("periphery", if you like) pairs, I've been watching for quite some time. LONG
The days of "just load up and collect the carry!" are coming to a rapid close. Central European central banks have already started to cut back (100 basis points at a time!) on their stellar rates, brought into effect to combat the similarly stellar inflationary pressures. It is a close call to favor this one over the USDHUF (both very LONG) but if you held a gun to my head I would have to go with this one, the CADHUF. Buy it up - LONG
Comment
Here is the closeup on the CADHUF ...... for a LONG Entry.
These pairs are rather volatile at this point due to the tendency of the Central European central banks to cut their rates by 100 basis points at a time - often twice in a month! Nevertheless, Buying this pair off of the 258 level is as close to optimum as it gets under the circumstances.
Trade active
If this pair closes anywhere in that (yellow) box within the next hour ...... it is very likely to go on a massive tear! - LONG
Comment
Fully loaded here ...LONG, especially versus the CAD; As in CADHUF (massive) LONG.
Comment
There is a really good chance here ...... for a long term Double Bottom! - LONG
Trade active
This is now also a massive LONG!!
Here is the 4 hr.;
Comment
Continue LONG and lean into it! (Add to Longs off of either Stop Hunt and move Stops up to 0.17% of the position thus, locking in even-money)
E.g., This should be a "free ride" from here (if you were Long from the original entry) including up to tripling the original position here!
Comment
Boom!!... and now, just move those stops under those Longs inline with the channel width, which is 0.74%. Easy-peasy.
Trade closed: target reached
FLAT, for now.
Comment
This move is far from over!Considering that recent numbers point industrial production down 7% and retail sales down -12.5% while inflation is still running at an eye-watering 20% ...
... the future of the HUF (Forint) looks precarious, to say the least. It will not be shocking to see a quick rise above the 400 HUF / 1 USD level (+20%).
E.g. we'll keep loading LONG in here for the foreseeable future, especially considering that >$13 Billion stuck short in here that will continue to be squeezed until it can be squeezed no more. ("Bulls make money, bears make money, pigs get slaughtered!")
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