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An Expanding Axis – Will Egypt and Pakistan Become Members?

by with No Comment Behavioral SentimentBusinessFeatured Highlights

An Expanding Axis - Will Egypt and Pakistan Become Members?

Opinion: The following article is commentary and its views are solely those of the author. This article was first published the 26th of May via The Angry Demagogue.

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China seems to be taking advantage of the transition from the Obama-Biden appeasement based foreign policy to the Trump commercial based system. Whereas Obama-Biden had no problem punishing allies that dared to oppose the US-EU appeasement and woke revolution, Trump is looking to create alliances based on commerce – and threatens allies that don’t go along. While the Obama-Biden policy failed utterly and arguably caused the wars in Ukraine and the Middle East, the Trump administration seems to be playing for time as it restructures the global security order.

China however does not seem to care to wait and are stretching their sway not only in the South China Sea but westward towards the Middle East. The four member Axis – Russia, China, Iran and North Korea seems to be expanding to other countries with strong military dictatorships. Egypt and Pakistan will be the next members of the Axis. While much of China’s belt and road policy deals with bankrupting poor, weak countries, they seem now to concentrate on strong military dictatorships. Egypt and Pakistan are being pried from the western camp as we speak.

Pakistan has, for awhile not been firmly in the western camp. It was a cold war U.S ally as India, while democratic, sided with the Soviets on most international issues. While the US was busy in Afghanistan, the Pakistanis played double agent. Now that the U.S is not in the region and the U.S and India have become closer, Pakistan is now firmly in the Chinese camp.

In addition to Pakistan, Egypt becoming the next major member of the Axis.

Let’s take a few steps back and examine the burgeoning relationship between Egypt – a military dictatorship and Communist China. As we have written China and Egypt had joint military maneuvers that included deliberate violations of the Egyptian-Israeli peace treaty guaranteed by the United States. Egypt, in thumbing its nose not only at Israel but at the United States, allowed Chinese planes to approach the Israeli border in order to test Israeli reaction to a possible invasion. Multiple Chinese military cargo jets flew in undisclosed hardware in the days leading up to the maneuvers.

Three more Chinese Y-20 cargo planes landed in Egypt last week again, carrying unknown hardware. At least one of these planes came from Pakistan. Egypt also seems to be signing major arms deals with France as Macron reeks of desperation in his attempt to remain relevant – but a de Gaulle he is not, and he will not be able to create a force or policy independent of the U.S. Egypt will be glad to take advanced French weaponry while it creates a stronger alliance with China.

Back to Pakistan one has to wonder if the Pakistan-Indian flareup a prelude to what can happen in other theatres – or worse, a purposeful conflagration to test Chinese weapons systems in actual combat and keep the West on its back feet? According to most reports they were able to shoot down between 3 and 5 of France’s most advanced Rafal fighters without even entering Indian territory. The confrontation started with a heinous terrorist attack against Indians in Kashmir by a terror group associated with the Pakistani armed forces. India claims that Pakistan is directly involved in the attack. If so, this would not have been the first one.

The downing of the Indian French built Rafal fighters by Pakistan’s Chinese produced 10-C was, according to expert reports, not just or even mainly superior piloting but with a Chinese strategy and technology that includes all aspects of air power – including recognition of the target, locking on and attack from distances in what an American air expert called a perfect air based killing machine. This would seem to be the first real test of Chinese advanced air-power and it something that needed to be done before any invasion of Taiwan. This may not test their own pilots but it does test the strategy and the technology.

China has a main medium term goal here and it is not a secret. They are planning to take Taiwan by force and need to make sure their soldiers, sailors and hardware are up to the job. They have seen how poorly the Russian army has performed and have seen how Israel has dismantled Iran’s defenses and swatted away Iran’s offensive attacks. China has not fought a major war for decades and for all the advances they say they have made – all have been untested. Until now.

China will not risk a war with India itself but would be more than happy to have its proxy involved. Chinese fighters and their new “over the horizon” missiles are key in their plans to deter the U.S from defending Taiwan – or in defeating U.S naval airpower if the U.S does get actively involved. However, as close as French technology is to America’s it is not the same and the one country that seems to have taken U.S technology to the next level is Israel. How would Chinese weaponry due against American arms in the hands of an air force equivalent in skill and bravery to the American air forces? That has yet to be tested but that brings us back to Egypt. Is it in China’s interests for Egypt to make a major break with the U.S at China’s urging much as they made a break with the Soviet Union at America’s urging? Of course. Would that mean that China might help Egypt provoke a military confrontation with Israel in order to test Chinese arms and relieve pressure on Iran? Maybe.

On to Iran then, where it does not seem that the Americans or Israelis understand the nature of the Iranian-Chinese relationship. Not only does China get the bulk of its oil (subsidized) from Iran but they have just completed a rail link from Xinjiang, China to Teheran, Iran – running through four countries. This rail line can ship oil as well as other cargo, cutting into the American (and Indian) naval superiority around the Persian Gulf and Indian Ocean. The assumption by military planners has always been that the U.S can cut off Chinese access to oil, if necessary. That is no longer the case.

China is not standing still – they are expanding their axis of dictatorships to countries in which the army is in control. Pakistan and Egypt qualify. Iran, while a theocracy is controlled by the Iranian Revolutionary Guards. No matter the “deal” that the Trump administration negotiates with Iran they will not be pried away from Iran. China has more to offer an ideological dictatorship then commercial deals with the United States. What the alleged realists in foreign policy refuse to understand is that dictatorships have no interest in commercial success if it weakens their grip on power. They are interested in deals that enrich their regimes since that also strengthens their grip on their people.

The trillion of so dollars in deals that the U.S has now made with the Persian Gulf states ensures that America remains a player in the middle east. Those who think that the Mideast is a tertiary region at best – after Asia and South America – need to rethink their strategies. As China closes in on control of the world from the Pacific to the Mediterranean the U.S is left with just two military powers it can depend on – Israel and India – to help defend its old/new commercial interests. It is not only oil – it is not Boeing jets, Nvidia chips and many other products that are moving from the US to the Gulf as opposed from the Gulf to the U.S. The U.S is no longer a commercial client of the Gulf states but the country who needs to protect its clients. The relationship has changed but the security relationship has only gotten more important.

The addition of Egypt and Pakistan to the Axis means that the Chinese threat has expanded. They are not giving up on Taiwan, nor are they giving up on South America and the Pacific Ocean but rather, China is using its experience as a dictatorship to strengthen ties with other freedom hating countries. We can all pretend that values and culture don’t matter, but that doesn’t mean that they don’t. This Axis is one where the interest of each member is to stay in power, force its will on its people and enrich itself at the expense of its people. This is an Axis, not only of the unfree, but of those who need to eradicate freedom to “thrive”.

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/ 

post244

High Level Antics as Trump Battles Institutions over Economy

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

High Level Antics as Trump Battles Institutions over Economy

Late last week Moody’s downgraded U.S debt, and the 10 Year Treasury yields as of this morning are near 4.50%. Yet, the Chicago Volatility Index is around the 17.25 level which is actually a small victory and shows that sentiment has improved quite a bit the past month. Let’s remember the VIX was near 60.50 in early April.

Wall Street had a handful of rather positive trading days too last week. Complexity remains a fixture for investors as they navigate their sentiment which is being generated by a rather stormy mix of perceptions. Day traders continue to face a tough betting environment via trends. The S&P 500 and other stock indices are showing signs of life, but how will they react to the Moody’s downgrade with a full weekend of consideration?

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10 Year U.S Treasury Yields Six Month Chart as of 19 May 2025

Last week’s U.S inflation numbers via CPI and PPI were weaker than expected, which raises the curious and obvious question as to why the Federal Reserve remains overtly cautious and refuses to cut the Federal Funds Rate by 0.25% basis points? Short-term traders still have difficult days ahead and those anticipating a fast and powerful bullish run in equities among the bigger indices need to remain vigilant. Sustained higher price action has likely not arrived quite yet for overly optimistic endeavors.

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S&P 500 Six Month Chart as of 19 May 2025

Let there be no doubt that there is a coming collision between the U.S White House and the Federal Reserve. The high level of yields the U.S Treasuries are accountable for are unsustainable and costly for the economy. President Trump will be in no mood for polite conversation with Fed Chairman Jerome Powell. Now that Trump is back from his Middle East trip he will likely turn his attention to the U.S debt downgrade and blame not only his predecessor in the White House but Powell too. Treasury Secretary Scott Bessent will likely address monetary policy too in the coming days.

The lower costs of WTI Crude Oil seen the past few months is helping fight inflation. As of this morning $61.70 is the vicinity for early trading. The price of energy appears to be within a solid lower range and likely has little ability to raise significantly. If the price of WTI remains under 70.00 USD this will help global inflation remain rather polite.

But this doesn’t take away from the threat of tariff pressures which do remain unknown. However, it can be argued the Federal Reserve is being far too cautious in the interim. Yes, the U.S central bank faces uncertain economic forecasts because of the potential of U.S tariffs hitting manufacturing and consumer prices, but there is a chance also the Trump administration will actually achieve better than anticipated trade agreements.

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EUR/USD Six Month Chart as of 19 May 2025

Gold as of this morning is slightly above $3,200.00 per ounce, which shows that speculators and investors have backed away from the buying power the precious metal created in the third week of April when the $3,500.00 price was challenged. The USD remains in a dog fight against major currencies in Forex as financial institutions look for equilibrium and try to decide if they should gamble on the Fed cutting interest rates in July. The USD has lost value since early April and remains in weaker mid-term territory. However, the EUR/USD has given back a lot of its gains made throughout April, but financial institutions may now look at current levels as viable support and become buyers again.

Day traders remain in a difficult spot. Wagering on daily market gyrations via interpretations of behavioral sentiment is sensible, but the problem is the quickly shifting winds that still remain a danger. Folks participating in the markets should use the 10 Year U.S Treasury yields as a barometer. Having fallen to lows below 4.00% in the first week of April, investors are again demanding more incentives to buy U.S debt, highlighting murky mid-term outlooks.

U.S Manufacturing PMI numbers will be released this week on Thursday, but this will not influence the markets too much. Instead investors will keep their eyes on the White House as media focus turns from Middle East politics to U.S economic policy. While there have been ‘green shoots’ emerging in the SP500, Nasdaq100 and Dow30, traders should keep their leverage at conservative levels if they merely intend on making short-term wagers.

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Market Volatility Shelf Life Doesn’t Have an Expiration Date

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Market Volatility Shelf Life Doesn't Have an Expiration Date

Updated: Apr 11

An associate in the financial world just wrote to me that “all bets are off”. Perhaps that is a solid way to think about the present speculative and investment situation. The tumultuous wave of hysteria in equity indices, Forex, commodities and U.S Treasuries are evident to everyone. President Trump’s tariff policies released last week lacked precision via perspectives for many investment institutions who suddenly had their mirage of calm destroyed. The realization that President Trump was undertaking what he had promised caught many by surprise who thought he was bluffing. Trump’s ‘Art of the Deal’ tactics are now being confronted by middlegame chess strategies from opponents.

While the broad markets have boiled and folks look for calm to return, the prospect that current volatility has the potential to carry a long shelf life with no expiration date has to be considered. Yes, the financial world will become serene again. The return of semi-tranquil trading has been seen in the Nasdaq, S&P 500 and Dow 30 the past couple of days – only because the losses and gains depending on the index have been moderate compared to last Thursday’s and Friday’s results.

Yet the shadow of more violent trading remains crystal clear. China and the U.S are now exchanging loud threats which include higher tariffs and retaliatory measures. The USD/CNY is under scrutiny as devaluation by China appears an evident threat. And U.S Treasuries are being watched as some contemplate that China is undertaking a selloff of U.S bonds. Higher U.S yields on long-term Treasuries will create pressure via the amount of debt the U.S will be obligated to pay.

Vice President J.D Vance’s peasant comments about China were not helpful on Tuesday. Why must a hornets nest must be stirred up? China has now been hit with a 104% tariff from the U.S, this while China has vowed to ‘fight till the end’ in its media. Asian markets are selling off cautiously this morning as tensions reignite. Forex pairs such as the USD/SGD, USD/ZAR and USD/BRL should be watched as a barometer not only by currency traders, but by those who want metrics regarding how global economic sentiment and credibility of policies are being contemplated. Risk adverse trading in emerging markets will cause harm and has the earmarks of looking like a stiff penalty for nations trying to develop and raise their standards of living.

While the start of this week has been smoother in relative terms compared to last week, the lack of a comprehensive end game is still missing. There is merit to treat current circumstances with cautious respect. The mid-term outlook remains highly questionable as President Trump and his negotiation gambits are tested publicly.

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Gold One Month Chart as of 9th April 2025

Gold has stumbled back to the 3000.00 USD level, WTI Crude Oil is down and these two commodities are intriguing as a looking glass into the hearts of large players. Are people selling gold short-term because they believe inflation will lessen because of a recession which some are forecasting, or is it merely a speculative move? Gold certainly carries an important risk adverse power and its lower move showed be looked upon skeptically.

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WTI Crude Oil One Month Chart as of 9th April 2025

Is WTI Crude Oil selling off because there is a belief there will be less demand due to fear tariff policies will influence a stumbling global economy? This viewpoint is plausible, the price of the commodity falling below 60.00 USD is a warning that large players are not comfortable with their outlooks and view downside risks as legitimate. The energy selloff in the past couple of hours is a negative barometer for what potentially is in store the remainder of the day in the broad markets.

The lack of finesse exhibited during these tariff negotiations is not palatable, the taste in the mouths of financial institutions has them worried. And outlooks via talking heads and analysts must be treated carefully by traders, this as they try to digest the onslaught of information and complex economic scenarios. Importantly, day traders should avoid getting caught up in the deleveraging talks surrounding the notion that large financial institutions will now pull money out of their U.S based investments in companies via stocks and Treasuries. Traders need to consider the bias of the people they are listening to and reading, and consider the scope and might of the U.S economy mid and long-term. There will be value found after the massive selloffs.

As a side note Warren Buffett has let it be known for a while he is sitting on a large amount of cash via Berkshire Hathaway. And folks should note that the annual meeting for Berkshire Hathaway is on Saturday the 3rd of May, which means people should get ready for insights from Buffett and his legions of admirers in the coming weeks. Certainly, Buffett’s comments and potential actions will be watched carefully.

The U.S Federal Reserve has taken a wait and see approach to the Trump tariff implications. Calls for an immediate cut of the Federal Funds Rate have not caused Fed Chairman Jerome Powell to shift his cautious stance yet. The coming days could bring a different attitude from the Fed if equity markets and U.S Treasuries perform badly. In the meantime some central banks have said they might become more proactive – the Reserve Bank of New Zealand cut its interest rate by 25 basis points this morning to 3.50% and said it will continue to cut their Official Cash Rate if tariff policies create more negativity.

The consideration by financial institutions regarding the beginning of a paradigm shift of the global economy is justified. However, the ramifications of the Trump tariff policies have a long way to go before these present days will be able to be pointed to as the moment the world decided that it no longer wants to participate in the U.S marketplace. That notion seems farfetched. The USD remains the world’s reserve currency, its corporations remain extraordinarily large and valuable, and U.S Treasuries as they absorb current volatility and see yields moving higher in the 30 Year bonds cannot be viewed as an economic apocalypse – yet. Yes, the warning signs are meaningful and the Trump White House will need to respond diligently.

Again, the past week of trading has seen vast disarray, but we have been here before. It is important to recognize that current circumstances however do remain dangerous, this because we are still in the midst of the crisis. At some point, egos will have to be put to the side. The Trump White House will have to negotiate with China. China may be vulnerable, but so is the U.S. Why be belligerent and show no respect to each other? The remainder of this week’s trading will produce more whipsaw results. Selling looks to be in vogue once again this morning. Behavioral sentiment and understanding its power need to be contemplated as folks await sunnier days.

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Examination Time: Nasdaq 100 and Trump Behavioral Sentiment

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Examination Time: Nasdaq 100 and Trump Behavioral Sentiment

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Nasdaq 100 Six Month Chart as of 25th March

Near-term trading in the Nasdaq 100 will face an examination of behavioral sentiment today and the remainder of the week. The stock index finished yesterday’s trading around 20,180.44, essentially traversing near levels directly before the U.S election results were known on the 5th of November. When trading reopened on the 6th following Donald Trump’s victory, the Nasdaq 100 jumped higher and began its trading near the 20,560.00 vicinity.

On the 29th of October 2024, the Nasdaq 100 also tested the 20,560.00 ratio, before reversing lower and finding choppy conditions leading up to the election date. Behavioral sentiment was certainly a factor in the outcome of these results. It cannot be proven, but can be asked and guessed that financial institutions may have started to bet on a Donald Trump victory before the election. Big trading influences may have turned anxious in the immediate days preceding the vote, then after the results were known returned the Nasdaq 100 to highs seen the week before on the 29th of October. By the 7th of November the Nasdaq 100 was trading above 21,100.00 and this was likely a result of optimistic outlooks.

The ability to climb back above the 20,000.00 mark yesterday and sustain the level was important. Yes, if the mark fades and another downturn now occurs it will show financial institutions are still leaning into negative outlooks as they consider the implications of tariffs and potential knock-on effects from the unknown.

However, if financial institutions have decided that they have priced in maximum risk premium and the selloff of the Nasdaq 100 to the level of nearly 19,150.00 seen on the 11th of March, which tested ratios last seen in early September 2024, was extremely oversold. We then have evidence that yesterday’s results back to values seen on election day, set the table for an important examination of behavioral sentiment.

There is plenty of room to traverse from 20,180.44 to 20,560.00. Yet, if financial institutions have decided that they once again want to test optimistic mid and long-term outlooks, the price level of 20,560.00 is where they will likely aim. Day traders should not get overly ambitious and remain cautious while looking for upside momentum if that is their chosen direction.

U.S economic numbers will be light today. Tomorrow the monthly Core Durable Goods Orders data will be published, the results will be of interest because they will show manufacturing sentiment and the statistics are considered a leading indicator. Thursday will also be noteworthy because the Final GDP results will be brought forth, but because this data is based on quarterly factors, the data may not be as important as tomorrow’s opening act – the Core Durable Goods Orders.

While the economic data will be important, President Trump will remain the focus. Behavioral sentiment obviously is being swayed by the winds circulating from the White House. This is not going to change until financial institutions begin to believe the threat of rhetoric can be dismissed without fear. The 2nd of April is now being counted down and in the sights of financial institutions as they consider the implications and outcomes of tariff negotiations. The word ‘agreement’ is sought as a salve by financial institutions. Whether a soothing ointment will be provided remains unknown.

The near-term will provide a test for traders which may be quite a bit like the week before the U.S election from late October and into November 5th when the voting results were still being counted. The Nasdaq 100 has room to traverse upwards and test values from the 29th of October and after Donald Trump was elected President. The 2nd of April is next Wednesday, and trading up until then will reflect on the outlooks financial institutions have regarding tariff negotiations.

It is examination week. It is not a coincidence that the price levels of the Nasdaq 100 are treading water while waiting for impetus. Speculating on the outcome before the 2nd of April needs to be undertaken carefully. An important question each speculator (including financial institutions) taking this test must answer is this: How good is President Trump as a negotiator and will he be able to claim a victory on the 2nd of April?

post235

Predicting the Federal Reserve and President Trump’s Rhetoric

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Predicting the Federal Reserve and President Trump's Rhetoric

Financial institutions have grown accustomed to the rather fierce rhetoric from President Trump in the early days of his second term. Financial institutions have also become quite used to the recent overly cautious statements from the Federal Reserve. This Wednesday the Fed’s FOMC Statement will be delivered and there will be no change to the Federal Funds Rate. The current ‘main’ borrowing rate offered by the Fed is 4.50%.

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US Dollar Index Five Year Chart as of 18th March 2025

This Wednesday Fed Chairman Jerome Powell will speak about the recent CPI and PPI numbers which came in below expectations. This typically would be a good signal regarding weaker inflation. And Powell might also mention that energy prices in the U.S have started to erode. WTI Crude Oil is now trading in a sustained manner below the 70.00 USD threshold, and this will influence the potential of less inflation. It is a good development for the U.S and Federal Reserve.

However, Powell is unlikely to express the unease and anxiousness the Federal Reserve has regarding President Trump, this because the Fed certainly doesn’t want to get into an open confrontation with the White House.

The U.S Treasury is now being run Scott Bessent who was selected by President Trump. Bessent ran the Key Square Group and is well respected in financial circles, which includes vast experience in top financial institutions. Powell though perceived as pragmatic by many analysts, may not be within President Trump’s trusted inner circle like Bessent and Commerce Secretary Howard Lutnick, the former Chairman and CEO of Cantor Fitzgerald. Lutnick is perceived as a workhorse who get things done and is smart.

The Fed’s likely cautious FOMC Statement will not be enough to appease President Trump this week. While some may think Trump’s attention will be elsewhere, those who have come to understand Trump know his capability to react quickly to events should be taken seriously.

What will Bessent and Lutnick think about the Fed’s FOMC Statement and stance? Powell is not a trained economist, do Bessent and Lutnick trust Powell? One thing for certain is that Janet Yellen who served as the Fed Chairwoman before Powell, and the Treasury Secretary before Bessent is not part of the inner circle in the White House.

Powell’s loyalties may be questioned, and eyes should be kept on Trump later this week to see how the President responds to the rather cautious Federal Reserve. The Fed will certainly not want to say aloud it is waiting like everyone else regarding the effects of tariff negotiations and their implications. Powell wants to keep his job. Trump certainly wants lower interest rates. Bessent and Lutnick certainly want lower interest rates too, but like Powell these two may prove pragmatic and know inflation needs to erode further. The Treasury and Commerce secretaries may want to test chicken and egg questions. Will these two gentlemen push Trump to proactively push for lower interest rates in a louder fashion?

Day traders will have to wait to see how financial institutions react to tomorrow’s FOMC Statement – which has already been accepted as being a ‘no interest rate cut event’. And it is probably being discussed in the White House that the Fed may want to wait until early this summer – June? – to consider another interest rate cut. Which means the Fed may not be cutting interest rates mid-term, while the ECB and BoE may have to be more dovish and remain active via interest rate cuts if their economies continue to show recessionary trends.

Meaning that risk premium which was factored into the stronger USD centric buying since the Trump election on the 5th of November until the peaks in mid-January and early February, and have now reversed lower – needs to be watched technically and weighed in combination with behavioral sentiment.

Intriguingly the US Dollar Index is around levels it stood at on the 5th of November (Election Day 2024). It is also near values seen on the 15th of October. (Did financial institutions start to bet on a stronger USD around this time because of a more cautious Fed outlook and the potential Trump was going to win the election?) Raising the question, if financial institutions envision the USD can technically be weaker and attain values seen in late September and early October when the US Dollar Index was testing support levels which have held since April of 2022. The US Cash Index which stands around the 103.070 level now, was trading near 90.00 in the spring of 2021.

Trump wants lower interest rates, the Fed wants to wait on cutting the Federal Funds Rate until they have clarity regarding the results of tariff negotiations. There will be a collision between Jerome Powell and Donald Trump, the only question is when it will happen. The US Dollar Index has been lower historically. Trump, Bessent and Lutnick may not want to say it out loud, but a weaker USD in the global economy would help U.S exporters. A weaker USD may not convey the strong populist rhetoric of MAGA, but it may be economic hardware the Trump administration actually seeks. To sustain a weaker USD, inflation levels will have to erode, and interest rates will have to be lower (and another myriad of complex events have to happen), until then rhetoric and risk premium will factor into USD Forex trading for financial institutions and speculators.

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New Alternatives for Regional Alliances & Global Effects?

by with No Comment Behavioral SentimentBusinessFeatured Highlights

New Alternatives for Regional Alliances & Global Effects?

post234

Opinion: The following article is commentary and its views are solely those of the author. This article was first published the 14th of March, 2025 via The Angry Demagogue.

There is so much going on that it really is difficult to keep up. Israel is at the center of many of the regional developments, as would be expected. But it is not just Israel as Israel, but Israel as an ally of the United States that is interesting. The Syria problem we have written about and it is still not clear what the Trump administration’s policy is there as they look skeptically but hopefully at Al-Julani’s Syria. In our opinion that decision will be made for them, since the chances that Al-Julani has changed his stripes to a Western democrat is small and even if we are wrong there – the armed Jihadist groups that he needs to control seem more interested in ridding Syria of ‘heretics’ than stabilizing the country.

Lebanon has changed enough for the United States and Israel to take chances. While it is too bad that Israel did not do more in ridding the country of Hezbollah, the fact that Syria is no longer part of the Shiite crescent means that they are isolated and not able to get funding and arms from Iran with the same ease. What is important about the current Lebanese government is that Hezbollah is not a part of it. That does not leave them powerless, but it allows the government to act more independently. The Lebanese Shiites, under Hezbollah and the less but still militant Amal, will have to rethink their loyalty to these two organizations. At the least, it should move Amal away from their stronger partner.

Iran now has no land route to Hezbollah and will have a harder time arming the Houthis, too. But it is in Iraq that they are facing problems which could cause as much damage to their projection of power as did the loss of Syria. Due to US pressure, Iraq has stopped buying Iranian electricity although they can still buy gas. It seems that the US is giving Iraq some time to find alternatives to Iranian gas and the Iraqi government is moving away from Iran on other issues too and are trying to get rid of Iran’s Shiite militias.

But the most interesting thing to happen is Israel’s attempt to strengthen America’s relationship with Azerbaijan, a country that Israel is in close contact with regarding Iran. Israel has always been rumored to plan to use Azeri air force bases in a possible attack on Iran. The Azeri official responsible for regional development was in Israel last month and is trying to bridge differences between Israel and Turkey. The Azeri’s next stop after Israel was to Turkey. Steve Witkoff is reported to have stopped in Baku after his visit to Moscow.

An Azeri company has also bought rights to Israel’s Tamar gas field. Israel currently gets oil from Azerbaijan via a pipeline that goes through Turkey so the energy relationship is strong and longstanding between Israel and Azerbaijan. It seems that Turkey’s relationship with Azerbaijan is more important to them than their animosity towards Israel – probably because the Azeris and Armenians are enemies. It seems that sometimes not only friendships have to be ranked but enemies, too.

Trump’s game with Ukraine is not necessarily to my taste but it could be that there is something much bigger going on here and that is connecting Israel, Russia, Central Asia and Turkey to a grand alliance with the United States. I don’t think that Trump will succeed in pulling Russia away from Iran and China and that Erdogan’s Turkey will not give up their dream of destroying Israel. But what if the Iranian regime falls after a combination of harsh sanctions, economic collapse and Israeli military attacks? What if Iran is pulled away from the alliance leaving Russia with just China? What if a Russian base in Syria is dependent upon their moving away from China?

Last year the Axis held a near continuous land bridge from the Pacific to the Mediterranean. China was moving into Russia’s “sphere of influence” in the “Stans” of Central Asia with their economic bear hugs. This was something that the Biden administration ignored, but could be a bigger headache for Putin than a well armed but non-NATO Ukraine with American businessmen instead of soldiers as a tripwire.

Are we giving too much credit to Trump and his foreign policy team and to Israel’s influence in the expanded region that reaches beyond Syria? Is there more going on than we know or less?

On October 7 and the days that followed, the Biden Administration was sure that Israel was in such a panic that it would agree to anything, and they could force the Obama Middle East of a hegemonic Iran and a Palestinian state down Israel’s throats – and overthrow Netanyahu as an extra. None of those things happened.

Only a fool would predict what will be in a year, but what we have discussed above is one scenario no one would have considered even six months ago. The post WWII world looked nothing like the world of 1937, and the post WWIII world (the one we wrote about a year ago and may or may not have happened!) will look nothing like September 2023 – no matter how hard the UN yells and screams.

Could Israel and Azerbaijan be the keys to a realigned world?

It is against my nature to be optimistic, especially since Israel is still not done with Gaza, the hostages are not yet home and the internal politics are reaching levels that border on a soft coup.

However, while we don’t know where the aces are, we know that the Obama-Biden jokers are no longer in the deck.

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/ 

post231

Bitcoin Lower after White House Crypto Summit Led by Trump

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Bitcoin Lower after White House Crypto Summit Led by Trump

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BTC/USD One Month Chart as of 8th March

Yesterday’s Crypto Summit at the White House didn’t meet the hopes of those who desire the U.S to be a proactive Bitcoin buyer. Baby steps accomplished for exchanges perhaps, but not a gamechanger for influencers looking to spark another rally higher.

Bitcoin is lower in early trading this Saturday, after the White House cryptocurrency summit essentially said it would hold onto Bitcoin that has been seized by the government, but did not express other impetus which would have driven the price of BTC/USD upwards.

While President Trump did sign an Executive Order creating a Strategic Bitcoin Reserve, it is important to note the holdings of Bitcoin and other cryptocurrency will consists of digital assets seized by the U.S, it doesn’t guarantee purchases of Bitcoin by the government.

Cryptocurrency backers may be unhappy with the White House’s lack of desire to engage in proactive cryptocurrency buying, including Bitcoin, which may have sparked the downturn being seen for the moment. One important statement in the Executive Order states:

“The Executive Order begins to resolve the current disjointed handling of cryptocurrencies seized through forfeiture by, and scattered across, various Federal agencies.”

A careful reading of the above and other declarations in the Executive Order, makes it clear that the Trump administration wants better oversight of previously seized Bitcoin and cryptocurrencies. The Executive Order while suggesting the government sold some of its Bitcoin in the past and other cryptocurrencies too early, can also be viewed as political statement proclaiming poor management – but this is an assertion which uses hindsight – which is always easier.

If the U.S government is holding substantial Bitcoin now, perhaps this may be the time to cash out considering the BTC/USD market is still rather highly valued. In other words, if the U.S government decides to hold onto Bitcoin too long it could simply prove to be just another speculator.

The Executive Order signed yesterday may create less restrictions and greater freedom for legally established U.S cryptocurrency exchanges that already exists. However, more flexibility for new enterprises trying to enter the sphere need opportunities they can pursue in what is already a competitive landscape. Bitcoin did trade above 91,300 yesterday, but after the Crypto Summit outcome began to see a selloff and as of this writing is hovering near 86,000 USD.

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Market Volatility Concerns While Deflecting Noise From Afar

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Market Volatility Concerns While Deflecting Noise From Afar

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S&P 500 Six Month Chart as of 27th February 2025

The phrase if it bleed it leads is a fixture regarding the world of media. People and their companies want your attention. The addition of Donald Trump to the White House helps those that are content to see him in office, but it also helps those who oppose him because it gives his detractors a centerpiece to a lot of their ‘insights’. Perspectives abound and while watching the financial markets, we are bombarded with loud opinions formed by folks vying for our time. In many cases they are also trying to attract our money.

Wall Street has seen choppy results the past week, but speculators need to remain objective and not allow distractions to destroy their ability to gauge the marketplace. When looked upon with a mid-term reference it is rather easy to define the results upwards in the stock indices from the U.S have been rather good. There is no guarantee you are going to make money speculating. Losses occur and they do not only happen to speculators but they happen to investors too.

Timeframe speculative management and separating the noise from facts is difficult enough under normal circumstances. However, because of the notion if it ‘bleeds it leads’ which is dominating media for the moment, we are within a cycle when influencers can use headlines to catch our attention. Perhaps they believe what they say, perhaps they are trying to guide us towards a product, or perhaps they simply enjoy predicting misfortune.

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EUR/USD Six Month Chart as of 27th February 2025

Yesterday during President Trump’s cabinet meeting when asked about the E.U, Trump stated a proclamation of love for Europe, but then added that the E.U was a special economic case and has been getting away with a lot of things like expensive tariffs on the import of U.S cars. He also said the E.U was created to compete with the U.S – though this needs to be taken into context and that Trump meant this only as a trade competitor.

Nearly as quickly as Trump made his statement, some began to use this loose remark as a narrative that the EUR/USD was struggling because of these new worries. Fears about a massive trade war were sounded from some legitimate but overly contrived media sources. Yet, a trade war between the U.S and E.U isn’t going to happen ladies and gentlemen.

The fact is that the EUR/USD has been struggling for a handful of months and is starting to show signs that support levels are durable. The greater likelihood is that financial institutions believe the EUR/USD is oversold and have a bullish perspective for the currency pair over the mid-term. Yes, Europe continues to produce lackluster economic data, but a lot of the value in the EUR/USD has had risk adverse concerns priced in already. Looking for upside from the currency pair around its current levels is not farfetched. Downside risks look limited compared to upside potential.

Once again the financial media who want your attention were given click bait material to get you to react. Day traders need to understand they are constantly being sold not only false narratives but false opportunities too. Speculators looking for profits with quick hitting trades can make money, but many times they lose money because they are working in conditions in which they do not have enough control of their emotions. Day traders should clearly understand they are operating within a gambling universe when they attempt to trade Forex, equities, Indices, commodities and needless to say cryptocurrency.

Traders must work on improving their decision making process. They need to take into consideration their perceptions of the financial landscape, but also understand what their counterparts are thinking too. Financial institutions certainly trade for short-term results, but they are also operating with mid-term outlooks. The likelihood that they are worried about an onslaught of tariffs from the Trump administration is contained by the realization that the current President of the U.S negotiates using tough methods. The bombastic hyperbole of President Trump’s business techniques are not loved by everyone, but they often get the job done regarding his intended desires.

So what should you do? First of all relax with a deep breath. The world is not coming to an end. The financial landscape is not facing a cataclysmic scenario. Many volatile financial events have been seen throughout time. Traders need to understand that the market action on the SP500, Dow30, and Nasdaq are vulnerable to selloffs occasionally that can last for unknown durations which makes daily speculative wagering prone to significant cash losses. This is why investors who have different perspectives regarding timeframes and take a slow and steady approach often come out better than folks who are merely gambling.

Day traders need to eliminate as much noise as possible. This is done with solid risk taking tactics using methods which involve knowledge gained through experience, and knowing that not everything they are hearing is meant to help. Practice a trading mantra by having realistic price targets, chosen timeframes, conservative leverage; using entry orders helps, adding stop loss and take profit orders to get out of positions are vital too.

The mid-term outlook for the EUR/USD and the stock markets likely remains bullish in the eyes of financial institutions. There are many factors in trading, and the virtues of patience and knowledge help considerably. Again, remain calm because while the financial markets often react to shortcomings via human fallibility, they frequently become optimistic once again.

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EUR/USD and German Elections: Saying Quiet Thoughts Out Loud

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

EUR/USD and German Elections: Saying Quiet Thoughts Out Loud

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EUR/USD One Week Chart as of 23rd February 2025

The German Federal Election is taking place today and an expected shift to the right is being anticipated via the German voting public. The EUR/USD will react to the trading results tomorrow on Monday, and speculators who do not have deep pockets may want to remain on the side and simply watch the volatility as it develops.

After touching highs late last week which brought the 1.05000 vicinity into focus, also challenging the highs seen in the previous week, traders started to sell the EUR/USD going into this weekend. Financial institutions will react to the results from the German vote and if the Christian Democratic Union wins with strong results, and the AfD (Alternative for Deutschland) takes more seats than some anticipate this will cause an immediate reaction in the EUR/USD.

Voting publics in the U.S and elsewhere are showing signs of voting for more conservative leadership. Germany has seen lackluster economic results manifest for a long time and their public is certainly yearning for more GDP growth and less inflation. It is no secret that in nations such as Canada, Australia and countries in Europe that conservative voices are becoming louder when unbiased polling is conducted. Prime Minister Trudeau of Canada has already admitted his defeat via his decision to step aside.

The United States saw a very strong election result for Donald Trump and Republicans in November, and it would not be a surprise to see a similarly strong outcome for conservative candidates in Germany as results are announced late tonight and tomorrow. Voters seem to be expressing frustrations they feel they are not allowed to say out loud in polite circles. The results from Germany will likely mirror this consideration.

So what will the EUR/USD do if the voters in Germany elect a vastly more conservative government? Early results will be choppy, but a logical wager is to believe financial institutions will begin to look at the EUR/USD with a more bullish attitude, this if they believe a government is going to take power that is business friendly. Day traders should not bet blindly on EUR/USD upside. But looking for the 1.05000 level and higher to become a focal point for buyers is a legitimate outlook near-term.

The selloff in the EUR/USD this past Friday may have had a bit to do with financial institutions believing the upside had been overdone before the results of the German election were known. But that is likely a false narrative.

There is a better chance the sudden selloff in the EUR/USD on Friday which developed and saw fast velocity downwards, happened because Wall Street equities produced declines on its open and the selling continued going into the weekend. Forex is never easy, many complexities exists for speculators to consider.

The results from the German Federal Election today will influence major currency pairs this coming week and the EUR/USD will be centerstage. If Wall Street begins to show signs of stability this will also help the EUR/USD. Day traders should be extremely careful early tomorrow as financial institutions start participating and react to the results from Germany.

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USD/CAD Risk Premium Shifts from Ultra to Prudent Nervousness

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

USD/CAD Risk Premium Shifts from Ultra to Prudent Nervousness

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USD/CAD Six Month Chart as of 16th February 2025

The USD/CAD has experienced a bullish trend the past six months which has seen risk premium factor into the highs seen on the 3rd of February when the 1.48000 vicinity briefly witnessed a flirtation. The currency pair will enter this week near the 1.41800 area. It appears financial institutions are shifting from being ultra nervous about the rhetoric between the U.S and Canada to merely prudent.

On the 5th of November the USD/CAD was around 1.39000. The currency pair is now traversing values seen on the 10th of December. Economic data certainly factors into the USD/CAD value, but the move higher has definitely been a product of the rather raucous relationship between President Trump and Prime Minister Trudeau. The drama is not completely over and Forex traders who are looking for a sustained downturn in the USD/CAD should remain cautious regarding their wagers.

Consumer Price Index data will come from Canada this Tuesday. U.S inflation data released last week showed prices remain stubbornly above the target the Federal Reserve uses as a benchmark. Canadian inflation will likely demonstrate the same type of price pressures upward. However, these forecasted results from the Canadian CPI have likely been priced into the USD/CAD already by large players.

Which leaves us with the Trump/ Trudeau saga. And while Canada may feel like it is being unfairly pointed to as a villain by the White House, the problem for financial institutions is that Trump is firmly in power and Trudeau is about to vacate his office. The Canada Federal Election will be held on or before the 20th of October, and it is worthwhile to take into consideration the Liberal party is probably going to lose its leadership role to the Conservatives and Pierre Poilievre will be at the helm. Rest assured that financial institutions are taking this into consideration as they consider their mid-term outlooks.

The USD has shown some signs of less strength in recent trading across Forex. Financial institutions are perhaps factoring less risk premium into currencies as they anticipate tariff negotiations to provide answers and somewhat calmer conditions. Somewhat being the keyword. USD/CAD traders looking to target support levels in the near-term may try to anticipate the 1.41100 ratio as a goal. Looking for the USD/CAD to go below the 1.41000 level may be too much wishful thinking for the moment. Reversals higher in the currency pair will still be seen.

The USD/CAD will likely start to show a downturn, the question is when. Timing a sustained bearish trend in the USD/CAD for the moment remains gambling. The notion that the USD/CAD will see lower values in the mid-term however may be the right conviction, but deep pockets and patience will be needed.

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Apolitical Doesn’t Mean Blind to the Trump Forex Reality

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Apolitical Doesn’t Mean Blind to the Trump Forex Reality

Has everyone stopped panicking in global Forex? It appears financial institutions are showing signs of stability and perhaps even optimism, this as USD centric strength appears to actually have begun giving back the outlandish gains made on Monday when spikes higher were seen across Forex.

The nervous buying of the USD early on Monday morning erupted after President Trump’s ultimatums were not taken seriously by financial institutions late last week. Outwardly it appears that the targets consisting of Mexico and Canada going into the past weekend also wanted to make believe all would be fine. The only nation to say that it would negotiate with Trump prior to Friday was China. And now Mexico and Canada have largely fallen into line.

Speculators may want to be apolitical. They may want to believe Forex has nothing to do with politics. And some traders may not like President Trump and what he represents. However, Forex participants need to make sure they put their biases to the side and understand that economic rhetoric and actions from the U.S do effect the Forex reality.

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USD Cash Index Six Month Chart as of 5th February 2025

We have seen a vast example of this the past couple of weeks, in fact the past few months. Financial institutions have braced for and wagered on their outlooks since early November when the results of the U.S election became known. A strong USD centric element has been demonstrated as they prepared for President Trump to take executive power in the U.S again.

This past week has seen vivid Forex results and demonstrated why it is important to pay attention to international news flow, even when some may want to disregard what they are hearing. The price action in Forex particularly the USD/CAD and USD/MXN this week highlight the significance of not turning a blind eye. The highs seen on Monday followed by the reversals lower have brought support into view. Near-term and mid-term considerations will be fought over by financial institutions and retail traders may find technical opportunities to take advantage of nervous behavioral sentiment.

China which has dealt with President Trump before, appears to have handled the tariff bluster and negotiations better than Mexico and Canada. China has also been laying the groundwork to deal with the new White House administration based on having dealt with President Trump before. The USD/CNY has remained stable and China has set the table to deal with developing economic discussions in a calm manner.

It is not a question of liking or disliking Trump, it is a matter of understanding the reality and being ready to trade the circumstances that are seen across Forex. Bias when trading Forex can lead to bad decisions, it is not about betting on who you like, it is about wagering correctly on the results you believe will happen and managing your risks.

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A More Aggressive Sounding ECB Could be Wishful Thinking

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

A More Aggressive Sounding ECB Could be Wishful Thinking

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EUR/USD Three Month Chart as of 30th January 2025

Will an interest rate cut by the ECB spark near-term buying in EUR/USD today? Financial institutions want news they have anticipated, day traders need to understand this dynamic.

The Federal Reserve stood in place yesterday almost acting as if it is afraid of its own shadow. No one was surprised the Fed did not cut the Federal Funds Rate. The Fed insisted inflation remains slightly elevated, it also said it thinks most of the worst employment data has been seen. What it did not say was that it remains in a quandary regarding the potential affects of President Trump’s policy on the U.S economy. The Fed wants to stay away from this debate. They also likely understand Donald Trump will bring up the subject himself. Trump wants the Fed to cut U.S interest rates more.

On the other side of the coin today stands the European Central Bank, which is anticipated to cut their Main Refinancing Rate by another 0.25, this to the 2.90% level. Financial institutions have certainly factored an interest rate cut from the ECB into the EUR/USD already. If there is no cut, this would cause an immediate reaction and likely a bad one against the EUR.

However, if the ECB acts as expected and cuts their rate this might actually spur on some near-term positive thoughts about the EUR and create some buying momentum. But for the move to be sustained and stronger, as outlandish as it might seem, what financial institutions will want to hear is that the ECB understands the E.U faces ongoing tough economic conditions and will remain dovish.

The problem with an overly aggressive attitude by the ECB today is that this is not anticipated. Yes, the rate cut of 0.25 is being counted upon, but the ECB and Fed are not exactly bastions of pro-active policy change. The ability of the EUR/USD climbing above the 1.05000 ratio last Friday and into Monday of this week was a signal financial institutions believe the EUR/USD is oversold, but they want to see more concrete steps taken. Doubts about what the ECB will say today has likely led to the 1.04000 level again being tested.

It may seem counterintuitive to believe that interest rate cuts from the ECB and a overly cautious Fed will help the EUR/USD achieve a bullish footing, but behavioral sentiment regarding mid-term outlook is crucial. Carry trade folks may say that if the ECB were to promise another cut today after their actions taken now, that this would create too large a difference between the ECB and Fed borrowing rates. This may be correct, but pro-active policy is something financial institutions would like to see. Day traders should be very careful today.

The EUR/USD hovering near 1.04000 is a signal that financial institutions will certainly react, there will be volatility in the coming hours. A rate cut from the ECB today will be the first ray of hope regarding a stronger EUR. However, unless the European Central Bank sounds like they will remain vigilant and are considering another potential cut sooner rather than later, the EUR/USD could quickly start to become choppy again.

The EUR/USD is essentially occupying a price range right now that it traded one month ago. Sentiment remains jittery. And President Trump will be watching and his comments which could come at anytime regarding the Fed, interest rates, potential tariffs and sanctions will create vulnerabilities for Forex and financial institutions in the days ahead.