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Trading Optimism for 2024 and Pursuit of Castles in the Air

Trading Optimism for 2024 and Pursuit of Castles in the Air

Traders may feel like horses being kept in their stables right now. The desire to run freely in Forex and other markets is certainly being felt, this as many analysts have jumped onto optimistic bandwagons and are pointing to the U.S Federal Reserve and its rather dovish outlook for 2024. Gold in early trading this morning is lingering near highs and the USD remains within weaker territory when technical charts are inspected via one month results.

Gold Three Month Chart as of 2nd January 2024

Yet, thin holiday trading is full in effect. Light volumes will continue to be seen early this week after the New Year’s celebrations. Financial institutions will open their doors today, but their corporate clients around the world will have plenty of employees who will remain on vacation until the 8th of January. Thus, while day traders may feel enticed to wager in the markets with various CFDs, they should be careful and understand unbalanced positions may cause temporary chaos. Risk taking tactics should be carefully considered.

The desire to dream about castles in the air is a source of comfort for many new day traders. But remaining realistic about potential results, while not getting overly ambitious about targets is an important aspect for all speculators. While trends may look attractive in Forex, commodities and equities a well planned approach regarding risk taking is a practical road. Castles in the air tend to vanish.

Optimism will be a word frequently heard in the coming days and weeks, and here’s to wishing everyone a prosperous and peaceful 2024. The potential of a more dovish U.S Federal Reserve regarding monetary policy and declining Treasury yields sparking more risk appetite in equities as investors seek solid returns is alluring, however risks remain on the table. The economy of China continues to worry analysts and tensions in the Middle East are still a long way from being solved.

However, the biggest cause for speculative concerns during 2024 may come from elections in Taiwan, India, South Africa and the United States. Taiwan’s presidential vote is on the 13th of January. China will certainly be watching the results, and traders should expect to hear swords rattling afterwards and then hope the noise calms down.

USD/ZAR One Year Chart as of 2nd January 2024

Tranquil voting results in India will be welcomed by investors. India is becoming a noteworthy economic giant, its rapid growth and ascension as an important investment vehicle needs to remain stable. South Africa remains troubled domestically by concerns regarding corruption and inefficiency, its upcoming spring election results may not solve the problems it faces. There will be many elections in Africa this year, which could spur on considerations regarding geopolitical alliances and the price of commodities.

The U.S election late in 2024 will start to grow in noise as the months progress and by early this summer behavioral sentiment will begin to become nervous regarding the outcomes for the White House and Congress. The U.S appears to be braced for an election between Joe Biden and Donald Trump and this will certainly cause skittish storms.

Traders should feel confident about risk appetite in the global markets improving, but they should keep in mind that impetus coming from many different spheres can affect the financial world.

Tuesday, 2nd of January, U.S Final Manufacturing PMI – today’s Purchasing Managers Index is expected to show a slight improvement, but the results may fall on deaf ears because many market participants will not be around to react due to the fact they are still on vacation.

Wednesday, 3rd of January, U.S ISM Manufacturing Prices – this inflation survey from purchasing managers may be given a bit of attention, but its effect may be limited because of light trading volumes still being exhibited.

Thursday, 4th of January, Germany Preliminary CPI – the inflation data from Germany will get some consideration, and the result is expected to show a slight increase. Services PMI data will also come from European Union nations, the U.K and U.S.

Friday, 5th of January, U.S Non-Farm Employment Change and Average Hourly Earnings – the jobs reports will get the notice of financial institutions. The results for employment and wages are expected to be slightly weaker than the previous month’s outcomes. Typically these numbers would cause a stir, but unless there are surprises, most financial institutions may not react massively to the reports because it remains a ‘holiday’ week. If the numbers come in weaker than expected this could cause interesting reactions on the 8th of January and weaker USD sentiment.

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Thin Holiday Markets Await FX Speculators

Thin Holiday Markets Await FX Speculators

Traders who want to pursue speculative positions this week need to understand that market conditions will be extremely thin. While the USD has certainly taken on a ‘softer’ dimension and financial institutions are demonstrating solid risk appetite, this week’s trading could produce lackluster choppy conditions.

Economic data will be light this week due to the ongoing Christmas celebrations, and the New Year’s holiday which will come next Monday. Forex markets can produce trading opportunities in the near-term for folks who want to wager on changes of direction, but some of the trajectories may be dubious and reversals could loom. Entry orders are urged for participants because spreads between bids and asks will likely be wide.

Gold Three Month Chart as of 26th December 2023

Gold remains within its higher price boundaries as the USD produces weakness, but betting on the precious metal this week could also be dangerous. Gold has certainly been trending upwards, but short-term speculative positions by large players could make the commodity agitated the next handful of days if they try to take advantage of light volumes. Day traders without significant bankrolls should be careful.

While economic data will be released, it is doubtful how much impact the reports will have on the broad markets. Active traders should monitor the coming statistics, but they should stay ‘more’ alert for possible outside influences which could shake confidence and shadow the rather optimistic behavioral sentiment which is currently being demonstrated.

News via international shipping should be given attention as the Houthis and Iran rattle their swords. While experienced traders will not be flustered by noise, the potential for escalating violence should be given attention.

USD/JPY Three Month Chart as of 26th December 2023

Tuesday, 26th of December, Japan Core CPI via the BoJ – inflation data from Japan has been published today and the Consumer Price Index came in below expectations. The USD/JPY remains on a downwards trajectory and should be given consideration.

Wednesday, 27th of December, U.S Richmond Manufacturing Index – this report being ‘highlighted’ shows the minimal amount of data being published this week. A decline versus the previous month’s negative outcome is expected. The likelihood that significant trading will be ignited via the results of this publication is almost nil.

Thursday, 28th of December, U.S Pending Home Sales – the data is expected to show a gain of 1.1%. However, it is next month’s report which will get more attention, this as investors look to see if the Fed’s soft monetary policy stance which was heard in mid-December, helps boost the housing market in the coming weeks. This immediate report however is likely to be met with a rather quiet reaction.

Friday, 29th of December, U.K Nationwide Home Price Index – this economic report like yesterday’s U.S housing numbers is destined to have little influence on short-term trading results. The GBP/USD will not be affected by this report in any great manner.

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Leverage and the Holidays Often Leads to Costly Volatility

Leverage and the Holidays Often Leads to Costly Volatility

This may seem like an unfriendly reminder for this time of year, but holiday trading can lead to dangerous storms for traders. Keeping a realistic viewpoint regarding your ambitions during Christmas and New Year’s is important.

Most day traders cannot afford to have an outlook that is beyond the short and near-term. This is an ugly fact many speculators with less than deep pockets have to acknowledge if they are new to speculating. While large traders and financial institutions can maintain mid and long-term outlooks, day traders who do not have the funds to keep overnight positions need to operate in an entirely different fashion.

Trends via technical charts and fundamentals are crucial for all traders. Behavioral sentiment is a key ingredient too for all participants chasing assets. However, day traders also need to understand unique risk management limitations. The use of leverage is a vital dynamic, and can cause devastation fast when too much money has been wagered. The use of leverage by day traders effectively raises the probability that a trade will lose money.

Incremental changes in value to a Forex pair, commodity and equity share being traded on a brokers platform by a speculator using ‘borrowed’ money via an account that allows for margin often leads to quick outcomes that fail. Many brokers offer traders ‘polite’ leverage ranging from 10% to 100% in extra funds, this while enticing the speculator to the potential of profiting in a quicker and more robust manner. It should also be noted that when a broker is offering vast amounts of leverage, they are knowingly increasing a traders likelihood of losing. The use of leverage beyond 10% leads to plenty of expensive mistakes.

Unfortunately, the simple truth is if you can make fast money trading, you can lose fast money while trading. The use of the word speculating is simply a gentle way of not using the word ‘gambling’.

Traders tempted to pursue wagers during the next couple of weeks should remember a lack of normal volumes make many asset classes more volatile, meaning the use of leverage by speculators often leads to dangerous gyrations within their accounts.

Risk appetite has taken on a optimistic tone globally because of the upside U.S equity markets have been producing, while U.S Treasury yields are decreasing, but dangers still lurk. Day traders need to remain realistic regarding their pursuit of quick hitting trades during the holiday season, and make sure they use solid tactics while pursuing their outlooks. The trend may appear to be your friend, but short-term reversals in the wrong direction can cost money.

No one wishes for bad things, but speculators should also note that if risk adverse events occur during the holidays, that ‘negative news’ can often become amplified this time of year and cause more volatility. Speculative positions in Forex, Crude Oil and gold can produce rather wild results, and thin trading volumes can add to the swift changes in values.

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Forex Calm After the Storm? Volatility and Coming Holidays

Forex Calm After the Storm? Volatility and Coming Holidays

The weakness of the USD was anticipated last week, this as the Federal Reserve essentially admitted its aggressive interest rate hikes policy has come to an end. While Fed Chairman Jerome Powell tried to sound neutral, most financial institutions reacted to the FOMC Statement and the Fed’s Press Conference last Wednesday with a rather demonstrative amount of USD selling, largely showing they were prepared to react.

The EUR, GBP and JPY all gained, and many other currencies added value against the greenback too. Gold flourished upwards and even WTI Crude Oil came off its lows. However, after producing strong gains late Wednesday and into Thursday, gold and major Forex pairs did reverse slightly lower on Friday as the USD gained some footing.

Gold Five Day Chart as of 17th December 2023

Risk appetite likely has enough positive behavioral sentiment influence to continue its desire for dynamic buying on U.S indices. The Dow Jones Industrials will start Monday at record heights, the S&P 500 and Nasdaq Composite are approaching one year highs.

Yes, potential headwinds can develop, so day traders should not bet blindly on bullish gyrations to mount without reversals being expected too. As the GBP and EUR gave back some of their gains on Friday, financial institutions may have been reacting to the notion price velocity higher had been too robust in the near-term. Speculators received another reminder that one way trends tend to meet with reversals that can still cause harm.

Risk adverse traders who have their eyes on global affairs should monitor the situation in the Red and Arabian Seas. Houthi extremists continue to fire at international ships sailing in the areas, and this may generate a reaction at some point from allied navies which are supposed to protect vessels and commerce. If the U.S Navy reacts to the Houthis in a strong manner this could deliver a cold short-term shiver into markets.

Speculators also need to understand this is the last ‘full’ week of trading before the Christmas and New Year holidays, which can cause a massive decline in volumes. This Thursday’s trading will begin to decrease from norms, and Friday’s price action will likely be affected by offices around the world starting to shutter as employees disappear for extended vacations. Day traders who want to participate in Forex, commodities, and equities via CFDs should be prepared for the emergence of quiet markets the end of this week with occasional volatility disrupting technical charts.

However, this Monday and Tuesday will pose questions regarding possible reactions to the weaker USD which has emerged, and U.S equity indices showing signs of speculative zeal. U.S Treasury yields continued to trend lower last week, and U.S bonds should be watched early to see if market participants continue their optimistic paces, or show signs of becoming more passive as the holidays approach. Traders with strong convictions regarding directions may feel inclined to remain active throughout this week and cannot be blamed, but some caution should be practiced.

EUR/USD Five Day Chart as of 17th December 2023

Monday, 18th of December, Germany ifo Business Climate – the reading is expected to show a slight improvement over the last month. EUR/USD traders may believe they should react to the results from this report, but the EUR is likely to stay within a USD centric mode driven by existing outlooks. The ability of the EUR/USD to hit the 1.10000 level late last week confirmed positive mid-term bullish outlook. The reversal lower on Friday may ignite speculative buying positions early this week, but day-traders may want to be conservative.

USD/JPY One Month Chart as of 17th December 2023

Tuesday, 19th of December, Bank of Japan Monetary Policy Statement and Press Conference – the BoJ is not expected to raise their interest rates quite yet. However the end of the BoJ’s negative monetary policy may be coming to an end in 2024. The BoJ bet on the notion that inflation would come down eventually, even it maintained a negative interest rate policy – this seems to have been proven correct. The USD/JPY has reacted the past month with a rather incremental decline. Perhaps Japanese financial institutions have been positioning for a stronger JPY over the mid-term. The USD/JPY trajectory lower remains intriguing for speculators.

Wednesday, 20th of December, U.K Consumer Price Index – the BoE sounded more dovish than many folks expected they would this past Thursday. Inflation numbers coming this week should be watched. The British economy remains lackluster, but sounds about ‘weaker’ inflation have been heard. The data from the CPI is expected to be slightly lower than the previous month. The GBP/USD could react to this report. The British Pound has delivered upwards momentum since late October. Traders should be careful regarding potential short-term reactions from the GBP/USD, and understand Forex volumes may start to decrease on Thursday and Friday which could affect results.

Thursday, 21st of December, U.S Final Gross Domestic Product – growth in the U.S has been better than most anticipated. While many analysts are still predicting a slowdown, the GDP number is expected to show a 5.2% gain. The inflation report via the GDP Price Index is anticipated to be 3.6%. While the broad markets typically would react to these statistics in a strong fashion, trading might be somewhat muted as financial institutions begin to focus more on the coming holidays.

Friday, 22nd of December, Canada GDP – a slight gain of 0.2% is expected regarding the growth statistics. Markets will be quiet and while the USD/CAD could see a momentary increase in trading, behavioral sentiment from earlier this week will likely have had a bigger effect.

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Dynamic Forex Conditions Expected via Inflation Data and Fed

Dynamic Forex Conditions Expected via Inflation Data and Fed

Day traders may have experienced difficult results the past few days as Forex produced choppy conditions. The USD proved rather strong on occassion and likely whipsawed technical speculators, particularly if they were looking for sustained trends to emerge with bearish perspectives regarding the USD. The EUR, GBP and JPY have demonstrated rather turbulent values. More challenging days are likely ahead for speculators, this as inflation reports from the U.S and the Federal Reserve are on the horizon.

EUR/USD Five Day Chart as of 11th December 2023

Curious economic data was published at the end of last week, this as the broad markets turned in a rather convulsive five days of results via financial assets. U.S jobs numbers came in slightly higher than expected for the Non-Farm Employment Change figures and the Average Hourly Earnings. Following the employment data, the Preliminary University of Michigan’s Consumer Sentiment reading came in much stronger than anticipated, and its inflation data found that people are less fearful of inflation looking forward in the States.

On Saturday, China released its CPI and PPI statistics and they continued to show a downwards path. China has taken on a rather sticky deflationary track and this signals that consumers and producers in the nation remain burdened by harsh economic considerations.

Gold One Month Chart as of 11th December 2023

U.S equity indices were rather jerky, but finished last week’s trading higher than they started. U.S Treasury yields finished the week higher, except for the 30 Year Bond which came in with a result slightly below its starting point for the five day period. Gold has seen its price come down from highs and this may be interpreted as a reaction to the stronger USD. The precious metal may be in for volatile days ahead.

The risk appetite flame has apparently been turned lower, but is still simmering and this is due to financial instiutions waiting to see if the U.S Federal Reserve delivers a neutral monetary policy rhetoric this coming Wednesday. The USD which had been getting weaker across the board for a handful of weeks, suddenly seemed to hit ‘support’ and reversed higher as questions regarding ‘fair market value’ may have been considered. Larger players in Forex are likely waiting for their outlooks to be confirmed via the Federal Reserve or dampened considerably. The higher Average Hourly Earnings data on last Friday was a reminder inflation data continues to be stubborn, even if many analysts believe the Fed’s higher interest rates will begin to have an impact in 2024 and slow the U.S economy.

Monday, 11th of December, U.S Ten Year Bond Auction – the results of the auction will be studied by financial institutions, particularly as investors debate the necessity for interest rates to be kept high, against those who are arguing for the need to cut the Federal Funds rate by late spring 2024.

Tuesday, 12th of December, U.S Core Consumer Price Index – the inflation numbers will be critical for behavioral sentiment and certainly affect the attitude of financial houses and their trading positions before the Fed steps into the limelight on Wednesday. The Core CPI numbers are expected to be slightly higher compared to last month’s outcome. Perhaps last Friday’s higher U.S earnings data will pave the way for a calm reaction if the CPI is strong. Forex markets will respond to this report and day traders should be braced for price ranges and spreads to get wider.

Wednesday, 13th of December, U.S Producer Price Index – the PPI numbers will be released early in the States, five and a half hours before the Fed’s Federal Funds Rate publication. Traders need to be ready for volatility before the Producer Price Index figures are reported. The inflation numbers are expected to be higher than the previous month’s outcome.

Wednesday, 13th of December, U.S Federal Reserve – the last interaction of the year for the U.S central bank and financial institutions will be an important affair. The Fed’s Federal Fund Rate, FOMC Statement and Press Conference will get full attention. The Fed is expected to hold interest rates in place, the question is what ‘vocabulary’ the central bank will use as it lays the groundwork for its 2024 outlook. While talk of a more neutral Fed, one that isn’t as aggressive has been envisioned, financial institutions want to see a ‘softer’ tone become the reality.

Depending on how the U.S Federal Reserve talks about inflation and its monetary policy insights for the next few months to come via this FOMC Statement, the USD will take center-stage and Forex conditions may become rather violent as Wednesday concludes. Day traders are advised to be very careful if they plan on trying to surf the waves caused by the Fed’s storms which will certainly be stirred.

Thursday, 14th of December, E.U European Central Bank – the ECB will release its Main Refinancing Rate, Monetary Policy Statement and conduct its Press Conference. The last ECB event proved to be rather mundane. While some talking heads may try to make this coming event into must see television, many financial institutions likely expect the European Central Bank to say, “the E.U economies remain lackluster, there are glimmers of growth in some spheres, but recessionary problems are still evident”, this while also mentioning inflation is observed to still be too strong, but showing signs of erosion. In other words, the EUR/USD is likely to remain USD centric according to existing behavioral sentiment that has been triggered earlier.

Friday, 15th of December, China, Industrial Production – the report is anticipated to show a better outcome than last month’s figure. China skeptics will examine these reports carfully, as well investors with ‘skin in the game’ in the nation.

Friday, 15th of December, E.U, U.K and U.S Manufacturing and Services PMI – these reports will be watched from the European Union nations, the United Kingdom and U.S, but the results will be filtered into existing sentiment which has been generated on Wednesday and Thursday from the Fed and ECB. Behavioral sentiment in Forex will likely look at the PMI results with vague interest levels. Traders should note that as the weekend approaches, there will be only one full week of trading left before the holiday season gets underway and financial markets begin to experience thin volumes.

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AMT Top Ten Miscellaneous Thoughts for the 8th of December

AMT Top Ten Miscellaneous Thoughts for the 8th of December

10. Book: A History of Venice by John Julius Norwich.

9. Music: Gram Parsons (featuring Emmylou Harris) playing Ooh Las Vegas.

8. Artificial Intelligence: Speed and processing advances will continue to make AI a buzzword in 2024, this as quantum computing looms in the distance.

7. Trading Volumes: Speculators should note there are about two full weeks of trading left before ‘thin’ holiday markets will begin to be seen. Meaning financial institutions while being cautious, will also start to position their assets according to their outlooks for early next year.

6. Energy Sector: WTI Crude Oil, Brent, Natural Gas and Unleaded Gasoline continue to challenge support levels as long-term lows remain in sight.

5. China: Important inflation numbers via Consumer Price Index statistics will come from the nation early Saturday, negative results are expected.

4. Risk Appetite: Optimism continues to be encouraging within behavioral sentiment, this as U.S equities remain near highs, the USD leans towards a mid-term outlook with potential weakness, and gold stays above 2000.00 USD per ounce.

3. USD/JPY: Bearish momentum continues in the currency pair, price velocity built speed yesterday and this morning’s trading has been dynamic.

2. Data: U.S jobs numbers will be released today, the Non-Farm Employment Change and Average Hourly Earnings reports will create reactions. However, unless the results are surprising, this data may simply work as an affirmation for existing risk appetite.

1. Federal Reserve: The Fed’s next FOMC Statement will be on the 13th of December, this knowledge will shadow the broad markets today and early next week.

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AMT Warning: Many Brokers Do Not Care if you Lose your Money

AMT Warning: Many Brokers Do Not Care if you Lose your Money

Sounds like the title has been written wrong doesn’t it? Reads as if the editor clearly doesn’t understand the nature of the financial markets and how they work. Certainly anyone who offers their services to you would like to see you make money, or so you would like to think if you are an idealist who remains innocent and trusts all people.

Unfortunately, the title of this artcle which has lured you into reading this WARNING is not wrong. It has been written as cautionary advice for new and even experienced speculators. Many of the ‘financial’ websites and people you are considering to engage with via their day trading platforms and ‘expert’ systems are not worthy. Many do not care if you make money and some in fact are planning on ripping you off.

Blackjack Betting and Sitting at the Table with Too Much Leverage

Volatility is in the eye of the beholder, brokers like when day traders without deep pockets use leverage, because they expect their ‘clients’ to get wiped out. Yes, brokers are not your friends in many cases, in fact they are rooting against you in the back rooms of their trading operations. Why? Because they are not actually putting your trade into the cash markets, they are allowing you to trade virtuallly. Think of it as entering a casino.

The casino wants you to bet outrageous sums of money, because they know statistically most gamblers will lose. Again, you have been warned. Your use of leverage is music to the ears of your broker, because they know the volatility of the market will knock you out of a trade if your margin trading is too high and the slightest of technical reversals will produce a losing position for you. Then they will ask you if you want to make another wager. You can continue to sit at the ‘blackjack’ table or walk away.

Learn To Trade Without Getting Ripped Off

The first thing you might want to ask and acknowledge when you begin to trade is how much money can be lost? The answer is all of your money. If the answer being given to you is that there is minimal risk and that you are guaranteed profits – immediately close the website you are looking at and find another. Guaranteed profits equates into assured losses for unsophisticated traders most of the time.

If you are speaking to someone on the phone and the person keeps asking you how much money you want to make, please hang up the phone and speak to someone else. Self proclaimed gurus should be shunned. As someone once said, people tend to use the word guru, because the word charlatan takes too long to spell.

Yes, even in the most reputable and best of companies who provide trading platforms, you are going to lose money sometimes. The art of speculating and successsful trading is a delicate balance between losing money and making money. It is probable if you are a new trader, that unfortunately you are going to lose money and you will become uncomfortable. Sure you could get lucky or be a prodigy who is supremely talented, but you should understand many folks lose money in the beginning. There is a learning curve for day traders and you need good teachers. You also need a calm emotional state of mind.

Finding a Pro to Trade for You

You might want to consider letting someone that you trust and who has a proven track record with verifiable clients you can authenticate to invest your money. However to have a pro trade for you, the amount of money as a minimum you will need for them to consider trading your cash is likely sizeable. It doesn’t seem like a fair question from a social perspective, but are you wealthy enough to allow someone to trade for you?

If you find a person that is reputable to trade for you, make sure they have explained their modus operandi and you agree with their outline. In other words have them discuss their plan of attack and how they perceive complexities within the markets. What sectors do they invest in, what is the break down via percentages regarding the amounts of money they put into various financial assets? Asking questions may seem a bit impolite, but reputable fund managers and family offices should not get flustered by your questions, and they should have answers that are easy to understand. Do not let them talk over your head with fancy words and equations. Clear and concise language is necessary.

You shoud ask how often they rebalance their portfolios and if they issue a quartertly report. Importantly, ask for an example of transparent accounting which shows transaction fees that will be charged in full, including services they are charged by other financial providers within your account. Commission and banking fees can add up quickly. And then ask the magic question regarding drawdowns, and what are the allowable losses in a trade and in an account that can happen before they have to stop trading. You should get clear explanations regarding all of your inquiries.

But You Likely Still Want to Trade for Yourself

If your emotions do not let you take into consideration that there are going to be negative days, perhaps declines for weeks and bad months – simply put, trading isn’t for you. Learning to handle your money and investing should not be a speculative adventure, this is not about having fun. Oh you will certainly experience thrills, but you should try your best to limit crises. Risk management is a way to curb the elements of gambling which every day trader is undertaking.

Will you become a professional investor? What is a professional investor? Nothing like semantics and flattery to get the juices of a prospective investor going. Do not be fooled by flattery. Do not be fooled by the fact that you have a degree. There are folks who do not have high school graduation certificates looking to take advantage of you, some of them are great traders and will eat you alive. Education at the best of colleges or universities is no guarantee you will become a good trader. There is a difference between paper trading and having skin in the game.

The marketplace is waiting for you to enter and anticipates taking your money. Brokers are trying to get you to come to their trading platforms because they want to make money from your transactions and wagers if they are not reputable. These brokers actually do not believe you will make money. Until you prove you know what you are doing you will be treated like a ‘mark’. When you do prove you know what you are doing you will be treated differently in more ways than one, and it might prove difficult to withdraw your winnings.

Trust is Important, but Facts and Regulations Help

You must deal with people and companies you trust. Make sure to do a deep examination of the folks you are about to forge a trading association. Trading virtually via digitalized CFD and Forex houses that are not regulated can lead to financial disaster. And ask where your broker is regulated, and then check on the mandates of the entity and government which has written the rules for brokers – are they legitimate supervisors and who do the regulations favor? There is a lot of work involved before you trade, you must practice due diligence.

AngryMetaTraders wants you to understand the game of trading. We talk about sports often because the world of trading can be closely compared. If you are good and lucky, perhaps the world of investing awaits your success. If you suffer a learning curve like many, you can compare yourself to an athlete that must train to beat the best. You will need patience and dedication. Surround yourself with reputable firms and people to asssociate your speculative endeavors with in order to get solid results long-term.

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FOMO Potential Could Fuel FX and Equities with Calm Winds

FOMO Potential Could Fuel FX and Equities with Calm Winds

Traders should not run towards their trading screens as the week begins, steady attitudes and risk taking tactics will be needed. Yet, there may be reasons to get excited. The return of full market volume as U.S financial institutions open and employees get back in their offices after the long holiday weekend needs to be monitored. The term ‘FOMO’ – fear of missing out – may be heard this week if U.S equity indices continue to shine, Forex demonstrates additional USD weakness and U.S Treasury yields decline further. There will be a whirlwind of economic data and opportunities for ‘official’ rhetoric in the days ahead.

Day traders should ask questions about the results which were seen technically via their charts last week, assets all struggled to find momentum last Thursday and Friday. And earlier in the week many Forex pairs produced choppy results. But here’s the thing, behavioral sentiment was rather muted as large speculators and financial institutions understood that trading volumes would be light – this caused strong bursts and sudden reversals early – but by the end of the week rather calm waters.

Many trading houses could increase their speculative positions this week based on their outlooks. Financial institutions clearly have believed the USD had been overbought and the ability of the GBP, EUR and JPY to gain in the past two weeks are possible signs large ‘players’ remain positioned for further USD weakness.

Equity markets have done well in November, but the major indices including the Dow 30, S&P 500 and the NASDAQ Composite all started to garner strength in the last week of October. Mid-term highs are being achieved in U.S indices. The parade of buyers may not be done quite yet.

Economic data results are vital for day traders to understand because they provide insights into the thinking of financial institutions regarding their outlooks. It is not the trading of small speculators that moves markets, it is the power of large cash positions which drives results. Questions regarding where the cash is going and the allotments financial institutions are pursuing is a key to understanding how the markets are going to react. This information is not readily available for day traders, instead smaller speculators need to try to comprehend outlooks regarding positioning and timeframes of larger players.

Part of the FOMO factor could develop as financial institutions begin to question how much money they will hold in money market accounts for their clients. While the practices of large investors are always comforted by the notion they are making guaranteed returns, the pursuit of better results and the desire for risk appetite does drive behavioral sentiment when bullish markets are being exhibited.

This week will be intriguing as full volumes return to the marketplace today and tomorrow. From today until the 13th of December FOMC Statement from the U.S Federal Reserve, results in the financial markets could be speculative. Financial markets are starting to signal that optimism is creeping back into the mindsets of large investors who may believe mid-term economic scenarios have improved.

EUR/USD Six Month Chart as of 27th November 2023

Monday, 27th of November, E.U. ECB President Lagarde – the European Central Bank leader will deliver thoughts regarding monetary policy to the European Parliament. While the E.U still is sufferning from recessionary numbers, economic data last week came in slightly better than estimated. However, the EUR/USD remains in a USD centric mode and this will continue this week.

Tuesday, 28th of November, U.S Consumer Confidence via the Conference Board, the numbers are expected to be slightly weaker than last month’s outcome. U.S economic data has been showing signs of being weaker than expected, last week’s Core Durable Goods Orders report followed this trend.

While this may be read as bad news by some people, day traders should note – particularly Forex speculators – that slightly weaker U.S economic data currently is music to the ears of many financial institutions because they believe the Federal Reserve will have to shift their rhetoric from aggressive to neutral.

Tuesday, U.S Federal Reserve Officials – a slew of FOMC members will be speaking at various events during the day. The Fed likes to give clues to the financial markets regarding their outlooks and perceptions regarding interest rates. The Federal Reserve has certainly paused their interest rate hikes.

The question now is if the U.S central bank will start to say while they remain diligent regarding inflation, that they now see signs of a ‘soft landing’ emerging within the U.S economy. If the Fed speakers begin to sound not only neutral, but offer hints of becoming potentially dovish by the spring of 2024 regarding monetary policy, this could spur USD selling.

Wednesday, 29th of November, Germany Preliminary Consumer Price Index – the inflation results are expected to be slightly weaker than last month’s outcome. German economic data has been recessionary, financial institutions know this, what large traders would like to see is stable results that are not wildly surprising.

Wednesday, 29th of November, U.S Preliminary Gross Domestic Product – the growth numbers are expected to show a slight increase. Equity markets, Forex and commodity markets will react to these results. The U.S economy has been surprisingly strong regarding growth. A slight slowdown regarding the GDP numbers would not be the worse thing, if growth numbers did come in below the estimate this could fuel additional USD weakness.

But traders should not get overly ambitious and bet against the GDP numbers. If the expected outcome of 5.0% is delivered, equity markets could use this as additional fuel. The number is sure to be a talking point, but unless their is a massive divergence it may simply be a way to create noise for ‘talking heads’, when in fact behavioral sentiment regarding risk appetite remains optimistic.

Thursday, 30th of November, China Manufacturing PMI – the result is forecast to show a slight improvement. China economic numbers remain a concern, particularly from the real estate sector which is suffering and is causing cascading troubles on other sectors within the nation. Global demand for products, as an example from European countries, that are suffering recessionay pressures also is slowing China’s manufacturing. A slight improvement would be welcomed by global investors participating in China financial assets.

WTI Crude Oil Six Month Chart as of 27th November 2023

Thursday, 30th of November, OPEC and JMMC Conference – the oil producers will certainly make their policies known and energy markets will react to the news and rumors. Commodity traders should note that WTI Crude Oil, Brent, Natural Gas and Unleaded Gasoline markets have been under price pressure and important mid-term cash support levels are in sight.

Thursday, 30th of November, U.S Core Personal Consumption Expenditures Index – this inflation reading is important and should be watched. The result is expected to be weaker than the previous month. If the outcome matches the anticipated reading of 0.2% or less, this could spur additional USD weakness. The Core PCE Index is an important reading for the U.S Federal Reserve regarding its inflation insights.

Friday, 1st of December, U.S Fed Chairman Jerome Powell – the Fed leader will be speaking at a college event in Atlanta. Traders should remember that about ten days before the Fed’s pause in November regarding its FOMC Statement, Powell delivered a large hint regarding monetary policy. The Fed Chairman’s comments will come late on Friday and could cause a reaction early next week if Powell’s remarks fuel more Forex speculation.

Additional note – the U.S jobs numbers will not be released this Friday, the Non-Farm Employment Change and Average Hourly Earnings results will be published on the 8th of December.

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Behavioral Sentiment: Sports and Trading a Key Correlation

Behavioral Sentiment: Sports and Trading a Key Correlation

In order to be an effective day trader a speculator needs to be able to control their emotions. A person can have years of market knowledge, the best schooling, read the world’s greatest books, be able to quote the leading financial experts and still be a bad trader. While it is important to understand the complexities being generated via technical and fundamentals and the power of behavioral sentiment, again it doesn’t guarentee you profits.

CBOE VIX Index six month chart as of 17th November 2023

When a day trader initiates pursuit of position, long or short, they can even be right about the eventual direction and still lose their money when the trade is complete. The missing link for many speculators while trading is their inability to control their emotions.

Many sports fans know that there are teams that have some of the highest paid athletes, but frequently have lackluster results because the team is not able to handle the bright lights of the stadium, they let crowds affect them. Some teams simply prove over time they are not prepared to really compete in the most important games; trading results frequently are similar when a speculator is not ready for the financial market they want to compete within.

Unless a market participant can handle their anxiousness, nervousness, frustration, assaults from value gyrations (reversals of price), doubts and the noise of the crowd (news being generated from the media that is mere hyberbole) and other challenges that can affect their emotional state – a trader is unlikely to have success.

Sports and trading are very similar sometimes. Professional athletic competitions between the world’s best are often a contest of ‘wills’. In many sports the top athletes are almost equally matched regarding their physical ability. In trading many speculators have the same perspectives regarding potential market directions, yet they produce different outcomes.

The difference maker in sports and trading when it comes to positive results – winning, is the ability to control their emotional state. Remaining calm and focused, knowing the goal and tasks that must be accomplished to achieve victory in sports and trading is often the result of keeping tranquil psychologically in the middle of battle.

You can have all the necessary trading skills needed to pursue a position within Forex, equity indices, commodities via the cash market, CFDs and futures, but if you do not have control of your emotions you are likely to lose.

Day traders also need to understand that one day of results, winning or losing, does not mean anything regarding future prospects. Like the best athletes, traders need to enter every trade as if it is a new game. Discipline, tactical objectives are important in trading. Being able to walk away from a losing position and leaving enough in your account to pursue the markets, for the next time you feel there is a potentially profitable objective that is attractive is also important.

You must know yourself to be a good trader, you must understand your own emotions and work on weaknesses. The ability to be profitable over a long time is not as simple as merely entering your online trading platform and opening a position which has been recommended or that you think is a winner.

It is one thing to understand the positive movement of a potential trade, but you must be ready for the negative possibilities when a trade is not going your way and the ability to navigate through the storm. Is your stop loss in place? Does the amount of leverage you are using allow you to walk away from a losing trade and still have enough ammunition (money) for other trades? Can you handle the volatility that is likely to ensue in potentially choppy conditions?

You need a solid gameplan. One of the greatest risks a trader is confronted by is their lack of emotional fortitude. Successful speculators embrace their trading positions because they are attractive, but they also manage their expectations and have a plan of attack in place before they enter every trade. Good traders can block out the noise of the crowd and enjoy the competitive nature of battling the financial markets.

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AMT Top Ten Miscellaneous Musings for the 17th of November

AMT Top Ten Miscellaneous Musings for the 17th of November

10. Book: The Art of War by Sun Tzu.

9. Music: Pablo Casals playing Bach’s – The Six Cello Suites.

8. Cricket: India and Australia will meet in the World Cup Final this Sunday in a match between two of the world’s best squads.

7. Gold: The precious metal is trading within sight of its October highs and may find speculative buyers looking for potential upside via wagers.

6. Commerical Real Estate: WeWork bankruptcy knock on effects will cause additional strains in U.S market, this as the sector struggles with vacancies in this era of ‘remote’ employees.

5. Risk Appetite: U.S equity indices are at three month highs, U.S Treasury bond yields at one week lows as optimism grows in the outlooks of long-term investors.

4. Data Watch: Retail Sales numbers from the U.K, and U.S Housing Starts and Building Permits statistics will be released today.

3. USD: Dollar Index futures are trending lower and near values last seen in the third week of September as financial institutions brace for a weaker USD mid-term.

2. U.S Treasuries: Yields are incrementally declining, helping push the USD lower, and creating positive equities momentum, this as U.S bonds appear ready to sustain a cycle lower if investors can remain tranquil.

1. Federal Reserve: Inflation data via the CPI and PPI were weaker than anticipated, and the U.S Fed’s December FOMC Statement should begin to sound less agressive.

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Preventing WWIII: Part 2 – Reviving Western Deterrence

Preventing WWIII: Part 2 - Reviving Western Deterrence

Opinion: The following article is commentary and its views are solely those of the author.

Aggressive Western Action Can over-extend China and Revive Needed Deterrence.

Some cliches are just correct, in spite of their being cliches – “if you want peace, prepare for war” is one. But really it should be “if you want to avoid war, deter war”.

Therefore, it is not clear to me why there is opposition by some in the Republican party to fighting Russian aggression in Ukraine. For some, I guess it is a knee jerk reaction against Biden administration policy while for others it seems to be a general loathing of American involvement in the world. 

Each is understandable on its own but does not take into effect the appeasement of Russia will have on Western deterrence around the world – including in the Western hemisphere and the Indo-Pacific. While most Americans understand that Russian control of Ukraine threatens the main Western European countries, the key to Russian imperialism really is in the south. Historically, Russia has always tried to find a warm water port to call its own. For nearly four centuries Czarist Russia fought Ottoman Turkey so that Russia could expand its territory southward and have a warm water presence in the Mediterranean. Currently, a Ukrainian presence in the Black Sea denies Russia even the opportunity to pressure modern Turkey to abide its wishes.

A Russian victory in Ukraine would mean dominance of the Black Sea by the Russian Navy and directly challenge Turkey to appease Russian power by giving them free passage through the Dardanelles to the Mediterranean. That in itself would not be worth much to the Russians without a port in the Mediterranean, which they currently have. That they have one goes back to the disastrous decision by the Obama administration to invite Russia back into the Mideast in order to take care of Syrian chemical weapons. This came, we all remember, when the Syrians laughed at Obama and crossed his “red line” about using chemical weapons against its own people. We might also remember when then Secretary of State John Kerry (the one who was never right on a single foreign policy issue ever) who, first demanded that Syria turn over all chemical weapons in a week, then reassured them that even if we attack it will be “unbelievably small”.

In 1973-4, Henry Kissinger brilliantly took advantage of the Israeli-Arab War’s outcome with Israel’s surrounding the Egyptian 3rd Army in the south and controlling the road to Damascus in the north, by brokering a cease fire on both fronts. This led directly to the expulsion of Russia/Soviet Union from the Middle East. While Russia continued friendly ties with the murderous Assad family – first Hafez and then his son, Bashar, they did not have a military, air or naval presence there. Due to this longstanding relationship with Assad’s Syria, Obama and Kerry thought it a brilliant idea to have them come in and do the dirty work that they didn’t want to do – prevent Assad from gassing his own people. 

As Russia came in and established air and sea bases in Syria and introduced the infamous Wagner group to carry out its brutal ground operations, Russia slowly started to strengthen its position in the region. While slyly allowing Israel to attack Iranian arms shipments meant for Hezbollah while pretending to be its ally, Russia formed a close  relationship with Iran. Wagner, which fought hand in hand with Hezbollah in order to prop up the Assad regime (and attack American forces fighting ISIS) is now rumored to be training Hezbollah in the use of Russian anti-aircraft systems. 

In addition, reports last week that an Iranian Ilyushin 76 cargo jet has now landed in one of the Russian air-bases they established after Obama’s kind invitation to return to the Mideast. This plane, filled with Iranian arms destined for Hezbollah has been unable to land in regular Syrian airports or bases because Israel continuously puts them out of service. Knowing that Israel would never attack a Russian base – this is a safe haven that Russia gladly supplies. 

When free countries unite in warfare there is usually one joint goal  – that they are all united to defend freedom – that is why they fight together.  While autocratic and totalitarian regimes fight together it is usually a combination of a negative goal – disturbing or destroying the current world or regional order – as well as the goal for each power in itself. Currently, the joint goal in the Mideast (of Russia, China, Iran and North Korea) is to hurt the main ally of the US in the region – Israel, in order to weaken and embarrass the US. For Iranians, they also want Israel destroyed. For Russia, they want Israel weakened so they can replace the US as the power broker in the Mideast. For China, it is to dismantle America’s control of the flow of oil and, eventually, the replacement of the USD in the global economy with the Yuan.

Ukraine is important in this calculus because, as we said above it gives Russia complete control of the Black Sea and will pressure Turkey – whose NATO membership is uses only to its own advantage – to break permanently with the West. While the Chinese theory is that the two fronts the US is supplying arms to, Ukraine and the Mideast, are tying it down and expending its resources it would otherwise use in the Pacific, in truth, an aggressive strategy on both fronts would be to over-extend Russian and Chinese resources in order to keep China from moving on Tiawan. A credible threat of destruction or even marginalization of the Axis allies in the Mideast – including (besides the soon to be gone Hamas) Hezbollah, Shiite-Iranian proxies in Iraq and Syria, as well as Iran itself combined with a major offensive in Ukraine will tie down Axis resources and possibly prevent a Chinese blockade or attack on Taiwan.   If its two main allies need full supply and full readiness to be able to respond to credible and massive attacks by Ukraine, Israel and the US, China itself might have to expend resources to prop up its own allies. 

Add to that a major show of naval force in the Indo-Pacific by Japan, India, Australia and South Korea combined with US forces will give China the choice of destroying their own wavering economy by attacking or blockading Taiwan or in maintaining peaceful Pacific trade routes while trying to prevent the collapse of its Axis allies. 

An immediate and radical change in policy can restore Western deterrence quickly.   Re-arming Ukraine and leaving Israel to do its job without pressure to stop in Gaza and to respond forcefully in Lebanon will send a strong message. Biden brought two carrier groups to the Mideast and told Hezbollah, “don’t”. But they did.  

In spite  of that  US Secretary of Defense Austin told Israel that its response to Hezbollah aggression in the north is “provoking” them.  

And the US hesitates even against Iranian proxies. Just now, the NY Times has reported that Biden-Blinken have turned down a Pentagon plan to be more aggressive in response to Iranian attacks against US forces in Syria and Iraq for fear of “provoking Iran” (this seems to tell us that the Austin complaint from Austin to Israel is really from Blinken).  

Iran never seems to fear provoking the US.   

Israel fooled itself by thinking Hamas was deterred by its destruction of an arms factory or two (as the US is doing now in Iraq/Syria) when proper deterrence would have meant them knowing we can and will go into Gaza and destroy their underground city as Israel is doing now. Instead, media fear mongers, backed by Israeli ex-Generals on the payroll of the US progressive left (via cushy think-thank jobs) combined with policy directives by successive governments have told us and Hamas time and time again that Israel cannot destroy Hamas as the cost is too high. I don’t want to speak too early, but that seems to have been as wrong as their assurance that Hamas is deterred since they want to drink white wine in the evening overlooking the Mediterranean while watching their children play innocent video games.

It is time to stop calling for cease fires and repeating UN hypocrisy and to start being aggressive and provocative in the defense of freedom. 

Disclaimer: the views expressed in this opinion article are solely those of the author, and not necessarily the opinions reflected by angrymetatraders.com or its associated parties.

You can follow Ira Slomowitz via The Angry Demagogue on Substack https://iraslomowitz.substack.com/ 

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To Risk or Not to Risk that is the Speculative Question

To Risk or Not to Risk that is the Speculative Question

Last week U.S equity indices demonstrated a rise in value. The highs achieved in the Dow Jones Industrial Average, the NASDAQ Composite and the S&P 500 by the end of last week only touched values seen in the middle of October. And while their ratios remain below the highs of early August and falling values seen in September, the move upwards was certainly welcome by financial institutions and day traders who hold optimistic viewpoints.

U.S Treasury yields declined last week. While incremental decreases were made through Thursday, the U.S Non-Farm Employment Change and Average Hourly Earnings reports both coming in below expectations on Friday, created a stronger dose of lower yields. The 5, 7, 10 and 30 year U.S Treasuries are now trading near mid-September values. The 2 and 3 year notes are moving around early September numbers.

Gold One Year Chart as of the 5th November 2023

The USD grew weaker in slight movements against many major currencies last week, but upon the weaker jobs numbers found increased selling price velocity. Gold however remains suspiciously strong, which brings up the notion that risk adverse ‘insurance’ is still being held closely by investors who remain nervous.

The Middle East crisis is ongoing in Israel against Hamas and to a limited extent Hezbullah, but financial institutions have seemingly been able to digest the news and remain tranquil and vigilant. Another sign of calm coming into the global financial markets is the price of WTI Crude Oil which finished the week under 81.00 USD per barrel.

Economic data will be relatively light this coming week, and behavioral sentiment appears to be the potential larger factor until Friday regarding impetus for day traders and financial houses. Certainly loud global developing news could suddenly erupt and cause nervous investors to falter, but last week’s trading results showed signs of improving risk appetite.

The U.S Federal Reserve met expectations last Wednesday and didn’t raise the cost of borrowing. The mid-term seems to indicate interest rates will remain high, but that the U.S central bank will not raise the Federal Funds Rate anytime soon. The lower than expected inflation report via the Average Hourly Earnings before going into the weekend helped highlight this thinking, although it remains a consideration that is still speculative.

Officials from the major central banks including the BoJ, BoE and Fed will be speaking this week and could cause turbulence with their rhetoric. However, no major surprises will likely come from their mouths. Although the Bank of Japan may rattle the prospects of intervention to keep USD/JPY traders on their toes.

Monday, the 6th of November, Germany Factory Orders – the result is expected to be negative and highlight the nation remains within recessionary conditions. The Sentix Investor Confidence reading will also be released slightly afterwards for the European Union and a worse number than last month’s outcome is anticipated. But the EUR/USD is likely to remain mostly USD centric, even though these reports could cause momentary fluctuations.

AUD/USD Six Month Chart as of the 5th November 2023

Tuesday, the 7th of November, Australia Cash Rate – the Reserve Bank of Australia is expected to raise its interest rate by 0.25% to 4.35%. Will the RBA take a gamble and not raise the interest rate due to other major central banks holding their rates in place, or will the increase go ahead to fight stubborn inflation while trying inspire some confidence in the AUD? A hike seems to be the direction the RBA will decide upon, having said that, the Australian central bank have surprised financial institutions before.

Wednesday, the 8th of November, U.S 10-year Bond Auction – the results from this sale and the yields that develop within U.S Treasuries will have an affect on Forex. Lower yields than anticipated could signal a weaker USD. However, risk adverse elements will need to be calm for the bond auction to produce tranquil results.

Thursday, the 9th of November, China CPI and PPI – the data from these inflation reports will be watched closely. Chinese economic numbers has shown some signs of stabilization the past few weeks, both of these publications are expected to have negative outcomes. Concerns about the financial pressures domestic consumers are facing regarding housing market values in China and the way in which they spend due to lackluster prospects are concerning. The USD/CNY will be affected in the wake of these statistics, and the USD/SGD could see momentary volatility too if the results prove to be a surprise.

GBP/USD One Month Chart as of the 5th of November 2023

Friday, the 10th of November, U.K Gross Domestic Product – last month’s number came in with an unexpected positive gain of 0.2%, this GDP report is anticipated to show no change. The GBP/USD jumped in value on Friday and financial institutions will be geared towards behavioral sentiment most of this week, but the British GDP data could cause a reaction before going into the weekend.

Friday, the 10th of November, U.S Preliminary Consumer Sentiment via the University of Michigan – the reading is expected to be slightly below last month’s outcome. U.S consumers remain a strong point of light for the U.S Federal Reserve. American consumers have remained spenders, although they have seemingly curtailed purchases of large ticket items such as cars and big appliances. If this data comes in weaker than expected it could propel more selling of the USD. A stronger number than anticipated could spook financial institutions and cause a slight surge in buying of the USD.