Let’s ask ourselves a few very simple questions. On a fundamental level…
What do you think would benefit the Trump presidency / program more? A strong U.S Dollar or a weak U.S Dollar? And why? ______________ (comment please).
Would you say that the world at large currently views the Trump train as a stable and positive contributor to international trade and global economic development…or as a negative? ___________ (comment please).
In the advent of some “international conflict” involving The U.S, Russia, China, Japan and/or any country in Europe would you expect this to be a positive or a negative for USD? ___________ (comment please).
What do you think the probability is of further escalation of conflict between The U.S , Russia , China , Japan , Korea , ISIS etc? _____________ (comment please).
Throwing around a bit of “geo political analysis” is always great, as it can help provide a viewpoint that isn’t centered on one’s own “local situation” not to mention a break from the math and charts.
Remember…fear and greed are what moves human beings to do the crazy things they do so…. keep this in mind while formulating your answers.
I’ll tell you what I’m doing.
Wait……let me show you.
Kong heading for The Arch in Cabo
Dollar fading……Eur solid…..Gold just took a $10 buck “rinse” on the weak handed.
I’m outta here for the day.
One of the fantastic things about trading forex is that it trades 24 hours a day.
You can have your charts and indicators running ( mine rings a bell when hit ) and choose to place a trade anytime of the day or night. The Japanese Nikkei is in full effect right now as it’s 2:10 p.m in Japan.
I’m in Mexico. You are in Poland. Dorothy is in Kansas. My Dad is in Canada. Who gives a rat’s ass where you are..Boom!
Kong buys EUR/USD at 1.0580. Right here……right now.
EUR/USD On A Japanese Afternoon
You’re going to want to buy EUR before Tuesday.
This trade fits into the exact same framework we have been working with…with respect to The U.S Dollar taking a very large nose dive – very, very soon. You can see in the chart below that EUR/USD has now put in an absolutely “classic swing low” right at the 50 day moving average…after completing only the first daily cycle of this new “intermediate cycle”. This suggests that we’ve got several more daily cycles to go ( lasting somewhere between 30-35 days each) before this upswing completes.
I would imagine the 200 day moving average ( marked in red ) should be the next target. That’s some 350 – 400 pips!
Buy EUR Before Tues Afternoon
These correlations with The Euro, USD and Gold are batting near 100% right now….as you can’t have The Euro rise without USD moving decidedly lower. The same thing goes for Gold, and if you really want to nail this…feel free to get long The Japanese Yen ( JPY ) as well. Yen chart looks exactly the same as EURO.
So…only one more asset class to consider here right? U.S Equities.
I can’t stand the stock market right now, as it’s continued rise goes against just about every fundamental principle I can drum up. There are too many indicators and factors to list – all suggesting this thing tops out soon…or at the very least – makes a serious correction. The stock market is cyclical and there is not a single thing “any acting president” can do to change that.
Trump has certainly “empowered the common man” with the talk of bringing jobs back, and I can certainly appreciate that but…..it won’t last. Unfortunately for stock buyers – foreign exchange leads the way and the message is painfully clear.
This thing needs a complete and total reset before some incredible turn around in the U.S economy will be realized.
Wash rinse repeat people. You know this. Has it ever been any different?
You don’t EVER buy pre-market…and I rarely buy anything in the morning.Period.
This is when Wall St. “sells to you”……where as in the afternoon….Wall St. “buys for themselves”.
You should file this away as another great tip / something to incorporate into your trading….as a mis-timed entries tend to keep you up at night.
And we all need our sleep right?
Resist the temptation to buy in the mornings….this will help a lot.
I told you I would be re buying gold right around the time I saw The U.S. Dollar bounce completed.
Well………The U.S Dollar bounce will end tomorrow so one can’t get to picky about “the perfect entry” but….
I’m re buying NUGT here at 12.35. Right here…right now.
The U.S Dollar has now breached the low from the previous daily cycle….confirming that this “next cycle” will also manifest as a “left translated cycle” and take the dollar decidedly lower.
But first we bounce.
We bounce higher in a confirmed downtrend so…you don’t go buying this dip in USD bonehead. You wait 4-6 days ( 6 at most I imagine ) and “sell the rip” as we are in a downtrend. Patience is everything when trading, as you’ve got to fight that “urge” to get in there…and be involved every minute of the day.
I can honestly say that these days ( having long since been through the emotional torment experienced when learning ) I spent more like 85% of my time plotting / scheming / observing markets than I do “actually trading”.
Magically…..the less I trade – the more money I make…but don’t confuse this with “investing”. Yes I believe that gold and silver have bottomed, the Euro will rise and USD will fall…JPY will surge and U.S equities will soon take a substantial hit so….
Investing is 100% totally / absolutely / without question OUT! I trade…..and I trade assets I believe to be in longer term trends. I don’t consider it investing.
Most of the standard correlations are looking pretty good right now ie…USD down has The Euro and commodities ( priced in USD ) moving higher…and The Japanese Yen flying cuz money borrowed some years ago is now repatriating to the place of its origin. Yen up = U.S equities down.
The fact that this thing has traded sideways for this long must have many of you looking at your portfolios and wondering – why haven’t I done so well this past year?
How much “higher” can you really expect anything to climb in the face of a dramatically waning “appetite for risk”.
The planet is completely freaked out about Trump. Good or bad….I have no opinion, but I can tell you this….markets hate uncertainty, and the future looks “more than uncertain” to say the least.
Wouldn’t you agree?
It’s always nice to look back and say “man I really nailed that trade”. But it’s the “knowing why” that makes the big difference between being a decent trader….and a professional trader. Was it just dumb luck? Was it a once in a lifetime “tip” from some guy dressed up as a gorilla?
Was it the hours of planning? Months looking back at longer term charts and trends….factoring in “macro global factors”, plotting areas of support and resistance and working thru best practices in money management?
Obviously the latter, with a few “ringers” in there, generally providing me with the information I need to make good decisions and trades.
I look at Japan, and I see a stock market that likely topped out a full year ago…and is just about to put in a “lower high” on long-term monthly chart. This lower high ( once confirmed ) should lead to a large-scale move lower in both Japanese and “global equities” as well the continued demolishing of The U.S Dollar. ( How many days ago did I make this call based in currency market movement?? ( a full week ago while many analysts are just now coming out with the news ).
We have arrived at the turn.
A large-scale turn on long-term charts suggesting that indeed….gold and silver ( now very much confirmed ) will begin a new yearly cycle and that USD will also do the same ( these assets moving in opposite directions ).
Stay sharp people. Book some profits at the very least.
Many gold market analysts focus on irrelevant, but catchy factors, such as mining production or jewelry demand. Others think gold is a simple inflation or stock market hedge. It is a bit strange that the relationship between the bond and gold markets is not commonly examined, given that bond market is much bigger than stock market, while real interest rates are one of the main drivers of the price of gold.
If you have even the most basic understanding of bonds, bond pricing, interest rates and how these are reflected / seen in financial markets as a whole have a quick read of this article at Gold Switzerland which quite accurately outlines my general feelings about gold, usd, bonds and our current set up heading into 2017.
Over the past 2 days. I’ve sold GPL, IMG and NUGT for a 28% return on the trades.
I’m still holding short USD/JPY as well long EUR/USD.
I expect this to be a “shallow dip” with respect to the gold and silver related stocks, so I will be scaling back in to these and more here shortly. On this next entry I am going to do my best to actually “buy and hold” something for at least a couple of weeks / if not months but then again…….we’ll see how that goes.
The larger macro turn in both USD as well commodities is slowly making its way…so there is still plenty of time to start building positions.