Winning Trades Update – USD, Gold and Silver

Obviously the short USD trades are now in the money as The U.S Dollar continues to weaken. The mining trades have been on fire with GPL, IMG and now NUGT ( purchased yesterday ).

It may at first appear boring to just sit around and watch a single asset  / asset class ( currencies and USD ) but one has to consider “just how much revolves around the value of USD” – as U.S equities and global commodities trade in this currency.

Correlations can always be found with respect to the “value of USD” and the price of “things” on planet Earth. Thus far we’ve really only seen the beginning of a much larger and expected fall in USD.

Perhaps this is where some of you stock traders can find a solid reason to follow currency markets closely. Also with consideration that JPY ( the Japanese Yen ) trades “in tandem with risk”. When JPY value moves lower – stocks move higher. JPY moving higher ( on repatriation of currency flooding back to Japan ) – stocks move lower.

That’s just how it is!

You can easily check currency pairs at www.stockcharts.com by typing the symbols like this: $usdjpy, $audusd, $cadjpy etc… just dont forget to add the “$”.

I will now focus on JPY as a turn in “global appetite for risk” will soon see JPY on the rise against nearly every other currency on the planet. That means “shorting” currency pairs such as AUD/JPY ( meaning….I a shorting the value of Aussie Dollar “vs” the value of JPY) where in AUD will fall and JPY will rise.

Hope it helps everyone!

Forex Kong Winning Trades

 

 

 

 

Canopy Growth Corp – Marijuana Soon Legal in Canada

Canada has recently released it’s plan to formally legalize the sale of Marijuana. The Marijuana related stocks have already taken off, but there are literally “opportunities abound” here in coming months. I strongly recommend that you start doing some company research NOW as these things are set for “stellar growth” through 2017.

Canopy Growth Corp being the largest player in the sector.

Canopy_Growth_Corp_Chart

Canopy_Growth_Corp_Chart

These companies ( and stocks ) are currently on fire, with the initial rush now over….providing a fantastic pullback and entry opportunity coming here soon.

Start getting a watch list together / ask me for further suggestions as these things should shoot for the moon as Canada finalizes it’s plan.

This is happening. This will happen in 2017.

Markets Extended – Dow Most Overbought In 20 Years

The Dow Jones Industrial Average is now “the most overbought it has been” in something like 20 years.

Dow_Most_Overbought

Dow_Most_Overbought

As markets looked ahead for the Federal Reserve (Fed) to confirm a widely expected 25 basis point hike in interest rates at 2PM ET (19:00GMT) Wednesday, attention was more likely to focus on the updated economic forecasts and particularly the “dot plot” showing policymakers’ expectations for the future path of interest rates, along with the follow-up press conference by Fed chief Janet Yellen, in an attempt to extrapolate how many more increases could be expected in 2017.

Fed fund futures currently put the odds of a hike at this meeting at 100%, according to Investing.com’s Fed Rate Monitor Tool.

Additionally, all 120 economists surveyed in the latest Reuters’ poll agreed that the U.S. central bank would opt to tighten policy, while a Wall Street Journal (WSJ) survey returned similar estimates.

Though there is always a possibility that the markets could be surprised by the lack of a move or a larger 50 basis point move, most experts think the chances are extremely slim based on what the Fed has communicated thus far.

2017 rate hikes

Looking further down the road, markets have priced in the next tightening to occur in June 2017 with odds standing at 61.6%. That is the first policy meeting where the probability passes the 50% threshold.

According to the WSJ poll, economists on average expected the Fed to hike rates three times in 2017, a slightly more aggressive path than the median outcome of two increases that policymakers themselves penciled in with the last dot-plot released in September.

Strategists at Brown Brothers Harriman believe that the Fed will stand pat on expectations for two rate increases in 2017.

“While this is twice as fast as the pace in 2015 and 2016, it fits any definition of prudent and cautious,” they said.

Too early to speculate on possible new fiscal policies

Since the U.S. elections, markets have speculated that incoming President Donald Trump would embark on fiscal policies including infrastructure spending that could serve to not only foster economic growth, but also to usher in inflation, placing additional pressure on the Fed to tighten monetary policy to avoid falling behind the curve.

Several Fed officials have indicated that his election had not changed their outlook because there were too many unknowns with regard to what policies Trump would implement and what their overall impact on the economy would be.

Chicago Fed president Charles Evans said last Monday that it was “still early to have a good idea of what fiscal policies and other events are going to mean.”

“As policies actually are enacted as opposed to just talked about, I think the appropriate thing to do will be to respond to them as they unfold,” Dallas Fed president Robert Kaplanalso said.

New York Fed president William Dudley, known for being the policymaker most aligned with Fed chair Janet Yellen’s way of thinking, also judged last week that “it is premature to reach firm conclusions about what will likely occur.”

However, Dudley did admit that if market expectations for fiscal policy becoming more expansionary were realized, then market participants could be right that the Fed “will likely respond by tightening monetary policy a bit more quickly than previously anticipated.”

In that sense, Yellen is widely expected to take a “wait and see” attitude at the post-decision press conference at 2:30PM ET (19:30GMT), stating that the Fed’s future movements will be data dependent.

Goldman Sachs did point to the fact that their U.S. economists expect a “more sizeable tightening cycle than the market” which could lead to further strength in the dollar as the market re-prices expectations.

“That said, we also think that chair Yellen will continue to emphasize that monetary policy is not on a pre-set course and that the data will dictate the future path of interest rates,” they added.

 

p.s I ripped this article from investing.com

Spot Silver Getting Close – Area Of Support Identified

The spot price of Silver is now reaching an area of considerable support.

The near term “five month fall” from 19.50 – some 20% drop…now looking like a great place to start thinking about buying.

silver_chart

spot_silver_chart

Start “thinking about buying”  –  not taking out a second mortgage and going all in (this would be ridiculous) as you can’t really argue with the chart. If you’ve been patiently waiting (as I have ) to see the precious metals not only bottom….but actually start moving higher….you can’t argue with the chart.

Maybe 15 bucks is the low, who can say for certain but the “area of price” is starting to look attractive for longer term buy and hold on Silver.

It’s boring I know. ” Hey guys I just picked up some silver, and it hasn’t moved in price forever!” – Nice work Kong. You really rocked that silver trade.

Gimme a break………

Take it for what it is….as you’re too lazy to pull the chart yourselves, just sitting and waiting for your broker to call you. Stick it. He’s too busy counting his commissions.

Spot Silver opportunity – something to be aware of.

 

 

Dollar Top – Tomorrow On Follow

One can only wonder how “positive for markets” a 7.5 Earthquake off the coast of Fukushima will be ( no sarcasm there )

Regardless…..USD topping out for the long plunge over the next several weeks.

I’m jumpin on board here shortly, and will likely get picked up sub 99.00 with tonnes of room for lower.

 

usd_topping_out

usd_topping_out

I like the short side, as people freak out and movements are so much bigger.

Steady as she goes…..

 

USD/JPY – Risk Off – Trade Accordingly

The currency pair USD/JPY ( U.S Dollar vs Japanese Yen ) is a bellwether for “risk appetite” in markets. Simply put, when  the currency pair rises…..risk is ON. When the currency pair falls – RISK OFF.

Risk ON meaning……the general investing community is in “buy mode”. Risk OFF meaning – “sell mode”.

USD/JPY – Weekly Chart.

usd_jpy_topped_out

usd_jpy_topped_out

I’ll let you be the judge….as “per always” – you can lead a horse to water – but you can’t make’em drink.

This chart looks terrible. After months of consolidation( June, July, August, September ) and now with the recent run up into “and after” the U.S election, USD/JPY finds itself at an interesting junction. You don’t see this in equity/stock markets as they only give you a tiny glint into the real world economy ( if any insight at all, considering the money printing and Wall St. corruption ) but…..currencies don’t lie.

USD/JPY will very soon turn. Global stock markets soon to follow so I challenge you to consider….

Are your assets currently protected? Stop losses? Mental stop losses? Greed got you by the balls? Any notion “what so ever” that…..tides may turn?

I’ve softened over these past years as….the Central Banks have made it impossible for the average “at home investor” to even consider things moving lower. I’ve “sung to the choir” at least a handful of times over the past years…encouraging my followers to exercise caution. I’ve been right at times….and horribly wrong at times.

This is another one of those times.

Caution warranted. Nothing more.

 

 

USD Topping Out? – Place Orders Underneath

The U.S Dollar has now reached “another” serious area of resistance here around 100.00 / 99.85

 

usd_topping_out

usd_topping_out

Inversely gold and silver mining stocks ( and likely the entire metals complex ) look to be putting in a serious low here ( as suggested in my previous post ).

As I’ve suggested time and time again….the absolute best way to play these “potential turns” is to place your orders some 50 – 100 pips “below” current price action….or in the case of “getting long EUR/USD” some 50 – 100 pips “above”. This way…..you don’t get picked up if price moves against you ( nothing ventured nothing gained right? ) OR you do get picked up on momentum moving in your direction.

Another way to do this is to place your order “above or below” the previous days high/low ( as seen by the bottom or top of the candle of the previous day ) – keeping yourself out-of-the-way of intra day fluctuations, but still leaving you tonnes of room for profit – should price action  move in your direction. The key is to get into the trade “on momentum” and not get caught in the daily volatility.

You can’t pick an exact price. You never can. No blog, no investment consultant, no snake oil salesman can call it that close – it’s impossible when you consider we are talking about moves in a currency as small as 1/100 of a cent!

As well…..if you are looking for further confirmation / theory that perhaps things are ready to turn lower….take a look at Apple ( AAPL )

If the entire planet is so “hell-bent on buying U.S Equities” – How come industry leaders like Apple look like shit?

1H Chart – Big Volume in Gold and Euro

This isn’t easy by any means but……after doing this for so long –  confidence builds.

You need to trade “so small” for “so long” that you still have some kind of an account balance left – once you finally figure this out. Most traders bet the farm within the first 3 months, lose everything, get super bitter and never return.

That´s not how I roll.

Boring as hell at times…( as trading should become – once you understand it ) but….one can´t really complain while sippin a cold one in their undies.

You wanna trade for a living? Calm the f”$k down……plan your trades, and TRADE SMALL when getting started!

In any case…I digress.

As per the post on Gold, USD and Eur back like….8 days ago……everything moving according to plan.

USD taking a pounding today……gold surely holding it´s own and EUR looking very close to bottom – if not already.

Hope you’re all doing great.

 

Forex_Kong_Ready

Forex_Kong_Ready

 

 

EUR/USD – USD And Gold – Alien Knowledge

A simple correlation – the price of commodities and the U.S Dollar.

Gold being priced in USD obviously.

As the “value” of The U.S dollar rises – Gold price goes down. When the value of USD falls….one would expect the inverse in gold. Gold moves higher as USD falls. All good?

So you should find it interesting then, that over the past few days ( since giving the green light to buy gold ) The U.S Dollar has remained strong. Suggesting to myself at least…..that “even with a relatively strong dollar” the price of gold and silver related stocks have not only remained buoyant, but have made some pretty sold gains over the past few days.

I bought IMG at 4.68 a couple days ago –  Now sitting at 5.29 – All the while USD has continued to move higher.

So what gives Kong? How can the value of the U.S Dollar keep rising AS WELL as Gold and related names?

Answer: An intermediate bottom in Gold.

I’m not talking about a nice little dip to buy, or a quick little stock tip to make you a couple extra bucks for beer….I’m talking about a large scale “fundamental shift in money flow” where the big boys are already well in position. Fully prepared for the U.S Dollar to fall – just that couple of steps ahead of you as…….you still see relative strength in USD even while the big money keeps scooping up Gold.

These large-scale “intermediate turns” don’t play out in a single day.

This will be short-lived, and here is why:

The Euro only further confirms the move currently in play as……it’s now very VERY close to bottoming as well.

Currencies don’t lie. You can’t have EUR and USD going up at the same time!

eur_bottoming_at_1-09

eur_bottoming_at_1-09

So the trade at hand is as follows. Long Gold / Silver and the miners NOW…….and short USD ( long EUR ) here in coming days…once this turn shows itself to the masses.

These “big turns” take weeks and even months for the big boys to build positions, so you don’t always see typical correlations playing out “minute to minute”. It’s my firm belief that the entire year of 2016 has essentially had the big money distributing stock to retail investors….while they quietly and patiently unload USD and scoop up Gold.

Make no mistake. It’s “Dollar Short Time” again here soon, with large gains planned in EUR longs, and a solid investment in Gold.

You think it’s backwards. You don’t think it makes sense but…….haven’t you been reading / lurking here long enough to know better by now? Once you throw currencies into your watch lists, and basket of tools to draw from…you can see things much clearer.

Big moves coming post election.