forex trading

Spot Silver Getting Close – Area Of Support Identified

Forex Kong 3 Comments

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

Forex Kong 1 Comment

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

Forex Kong 6 Comments

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

Forex Kong 2 Comments

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

Forex Kong 8 Comments

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

Forex Kong 3 Comments

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.

 

Why Are Markets Trading Sideways?

Forex Kong Got something to say?

In a general sense……you can’t do shit when markets continue to trade sideways.

It’s very difficult for new traders as……you still feel that you “must keep trading” in order to keep money coming in. Trades go nowhere, you get frustrated…..then you make mistakes. Costly mistakes.

Taking a quick look at the Dow ( going back a few months ) we can see at least the past 8 weeks as virtually “unchanged”. Marketing stuck in the mud a full 8 weeks now.

 

dow_trading_sideways_for_months

dow_trading_sideways_for_months

You can’t “really” trade this, as this small amount of movement leaves little room for profit – and timing entries becomes paramount. You need to recognize it for what it is….and accept it. Then your trades / trading will improve.

I don’t really expect this to change until AFTER the U.S Election / Gong Show finally winds up in November, and will be planning trades accordingly. Smaller orders…lower expectation. More planning for the larger moves expected post elections.

It is what it is…..you’ve just got to learn to recognize it sooner.

 

 

 

 

Understanding USD/JPY – You Know You Need To

Forex Kong 12 Comments

With Japan now out of the way….we can clearly see that markets don’t dig it. The Yen is powering higher which is the absolute last thing Japan would like to see.

A strong Yen is terrible for Japan ( as a strong currency is for any nation these days ) and suggests that money is actually flowing “out” of markets – back to the place where it was originally borrowed at 0%.

asimo-is-selling-his-u-s-stocks

asimo-is-selling-his-u-s-stocks

Think about it.

Let’s say you went nuts and borrowed thousands of dollars when the interest rate was 0%, then invested it in U.S Equities hoping you could make a buck. Months later your U.S Equities trades are flat at best, but even more likely sitting at a loss. Then you figure out……hey wait a minute – if we get an interest rate hike here in The States…this market is gonna tank! You sit there thinking…..man I better get the hell out of here, or I am gonna get killed.

Imagine if they actually DO raise rates in the U.S today? You are hooooooped!

How will I pay back all that Yen I borrowed??

So you unwind your trade. You sell your U.S Equities likely at a loss…..then you have to convert the U.S Dollars “back” to Yen ( at a new rate that also hurts ) and finally pay back your loan. This is the fundamental driver behind movement in the currency pair USD/JPY. This is why it’s been tanking since markets “actually topped” back in late 2015. Everything else has been pure distribution as the big boys and heavy hitters unwind their Yen Carry trade, and it’s taken more than a year to quietly do so.

You can see it on the charts  so clearly, and now that USD/JPY is at parity……things could get pretty ugly.

Clear signs that markets have more or less topped out – and have been distributing to retail “hopefuls” for the past full year.

Little mining stocks on fire….just getting started in the larger macro trend people so……go grab a couple!