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USD/INR: Higher Move Correlates and Political Shadows Loom

by with No Comment AMT MarketsAssetsFeatured Highlights

USD/INR: Higher Move Correlates and Political Shadows Loom

The USD/INR is near the 82.8150 ratio as of this writing the 9th of August, on the 25th of July the currency pair was near the 81.6500 level momentarily. Upwards movement of the USD/INR did produce price volatility in the last week of July, and on the 1st of August the Forex pair was near the 82.1700 ratio. Another dose of upwards momentum quickly occurred on the first day of August, and by the 2nd the USD/INR was trading around the 82.7650 mark.

From Wednesday of last week the USD/INR has essentially taken on a consolidated framework, speculators who are gambling on the USD/INR and need big movement to occur in order to facilitate profits have likely found the currency pair difficult to manage. Yesterday a high of nearly 82.9500 came within sight briefly, this as global risk adverse conditions arose because of the Moody’s rating agency downgrade of some U.S mid and small size banks regarding their fundamental ‘soundness’ and credit worthiness.

Rising interest rates from the U.S Federal Reserve have made it harder for many U.S banks to conduct their business, and loans have become more expensive for their clients struggling to keep up with the rising payments. Particularly if borrowers have the unfortunate position of holding ‘variable’ loans which cost more when interest rates are going up. This has also affected the housing sector in the U.S and in the U.K, as mortgages have become highly priced due to the Federal Reserve and Bank of England having aggressive interest rate policies which are affecting the cost of new home purchases.

The question USD/INR traders may be asking is what does this have to do with them?

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USD/INR One Month Chart as of 9th of August

The USD/INR Doesn’t Trade in a Vacuum

The USD/INR has risen in value the past two and half weeks as many other major currency pairs have suffered a similar fate. Nervous sentiment abounds in the global markets because financial institutions are wary of what the major central banks will do next. U.S economic data has been mixed recently, but this perspective depends on time frames regarding outlooks.

Short and mid-term viewpoints continue to point to complications regarding growth and inflation expectations and interpretations of U.S data. The ratings downgrade of some U.S banks from Moody’s yesterday, and early last week Fitch’s downgrade of U.S Treasuries all is related. Rating agencies are getting nervous, perhaps because they do not want to be blamed and held liable if the proverbial ‘fluff’ hits the fan over the mid-term. Rating agencies largely ‘missed’ the financial crisis of 2007 in a famously bizarre manner. The sudden emergence of rating agencies warning investors has made the USD stronger as global investors have become risk adverse temporarily. Yes, this might feel illogical, but the USD remains the world’s safe haven.

The USD/INR also certainly trades because of economic conditions affecting its value from within India. The Reserve Bank of India has a large hand in managing values and is known to be rather active regarding interventions. Yet the USD/INR is being ‘allowed’ to continue to trade near all-time highs. This as India’s status as a growing economic power has taken shape in the global financial markets the past year. The India government has not been aggressive regarding its interest rate policy, and has allowed inflation to seep into the domestic economy via a weaker Indian Rupee for a number of complex reasons. Purchasing goods from India abroad and the ability to invest in India by global financial institutions may be more attractive to those holding USD and needing to convert into INR only when the time is necessary.

Politics and the USD/INR Price Level as 2024 Elections Start to Lurk

From a political perspective too, let’s acknowledge a general election will take place in India in April and May of 2024. Economic decisions being made today and for the mid-term are certainly being affected by the ruling Indian government’s outlook and desire to remain in power. Having come off of yesterday’s highs in the USD/INR the currency pair does remain within sight of highs.

The 83.0000 level likely remains a key barometer for the USD/INR and the Reserve Bank of India is likely watching this value carefully. While it seems unlikely the India government wants the USD/INR to trace much higher because of the psychological implications, global risk adverse sentiment are making the higher values of the currency pair sticky. Tomorrow’s inflation data from the U.S will affect Forex and the USD/INR via the Consumer Price Index. Friday the U.S Producer Price Index will be published. A slight rise in the broad CPI results tomorrow is expected, while Friday’s PPI outcome is expected to match last month’s numbers.

If risk adverse trading remains evident today and the USD/INR holds its ground over the next 20 hours, the currency pair could find that its consolidated price movement from the past week suddenly changes. A higher tick in U.S inflation could be enough to cause the USD/INR to challenge the 83.0000 ratio. Speculators who are wagering on the USD/INR are cautioned to be pro-active regarding their risk management the remainder of this week.

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Business Success Techniques Used by the Amish Communities

by with No Comment BooksBusinessFeatured Highlights

Business Success Techniques Used by the Amish Communities

Book corner: Success Made Simple, An Inside Look at Why Amish Businesses Thrive, written by Erik Wesner

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Success Made Simple

Can old stereotypes disappear? That’s the question one faces when reading Success Made Simple, An Inside Look at Why Amish Businesses Thrive, by Erik Wesner. Wesner, a sales and management professional who has done business with the Amish in several states, plus interviewed and studied them, changes our perspective of the Amish as he sets out to explain a staggering statistic: 95% of Amish businesses succeed as opposed to 34% for the remaining population.

A few words about the Amish. A U.S based Anabaptist Christian community with roots in Switzerland, the Amish are closely related to Mennonites and have traditionally believed in simple living, pacifism and non-violence, rural life, manual labor, Bible study, and the eschewing of modern technology. Easily recognized by their traditional clothing, they speak a form of Old German between themselves. They are literate (and speak English, which they learn at school) but their education stops at the eighth grade, where they begin working full-time. Perhaps the most well-known portrayal in the media is the 1985 crime drama Witness, starring Harrison Ford as a Philadelphia police detective seeking shelter with the Amish from corrupt rogues on his force. A major success, the movie cast into the public’s consciousness a rigid community of simple farmers and craftsmen who minimize all encounters with the outside world and look at the English – their word for all non-Amish – with extreme suspicion.

Erik Wesner’s book, written in 2010, presents a very different, or rather changed, group of people. Wesner interviewed fifty Amish small to medium business owners, some who he already knew personally. They were accommodating, friendly and content to discuss their success stories and business philosophy, although true to Amish form, they were modest in their achievements and strict about not coming across as showing off or bragging in any way.

Wesner explains that as the twentieth century drew to a close, the Amish realized that their high birthrate and limited remaining available farmland left farming as an increasingly unrealistic option for newer generations. They also realized that they can maintain their way of life and values while benefiting from the increasingly unavoidable interactions with the English, so they began turning to creating businesses that serve the outside world. As Wesner explains, what they lack in education – there is not a high school graduate or an MBA among those interviewed – they make up for with a hardcore work ethic instilled in them since birth. (Just a note – a few of the those interviewed have attended business lectures and seminars.)

Wesner divides his findings into eight chapters, with each chapter explaining a different business concept and containing personal stories as to how the Amish run their businesses and embody that concept. I was surprised to learn that although modern technology plays no part in their homes (for example, their home lighting and dairies are powered by gas), those who maintain offices, stores and workshops outside the community are completely well-equipped, with computers, internet, phones, etc.

The common sense wisdom espoused by the interviewees is powerful. The Amish wisely believe in staying with what they know and what they are good at, such as crafts, construction, restaurants, supermarkets, furniture, etc., and will not stray beyond the sphere of familiarity. Wesner credits this homey approach to producing a more quality product. This is just the beginning. The book describes their wise, old-school approach to, for example, customer service. They believe in honesty and integrity with their customers (their religious beliefs forbid them from any dishonest dealings anyway) and giving excellent service. They are always eager for constructive feedback from their customers, and strive for a good reputation and repeat business.

Additional subjects are hiring/firing (they tend to give lagging employees chances at success), nepotism (they believe in family businesses but are just as demanding with their families as they are with their other employees), job training (their lack of book education gives them a natural inclination and leg up in using “hands-on” approaches to training), leading from the front (Amish bosses will do the most menial tasks when needed), staff relations (they are quick to praise their employees), expense control (their frugal background gives them a natural advantage at controlling what goes in versus what goes out), and employee benefits (they have summer campouts, picnics and paid breakfasts for their teams).

 

So can old stereotypes disappear? With the Amish, they certainly can. An absorbing and interesting read.

If you want to read another Book Corner article, please visit this review by Evan Rothfeld: https://www.angrymetatraders.com/post/ten-more-ok-now-twenty-finish-thirty-next-run-the-hill

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Anxiety and Surprising U.S Data for Day Traders to Consider

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Anxiety and Surprising U.S Data for Day Traders to Consider

Global central banks stayed in their anticipated lanes last week as the Fed and ECB raised their key lending rates. The BoJ has admitted it is allowing its yield curve to increase, meaning the Japan government is cutting back on purchases of Japanese bonds. Forex produced anxiety and choppy results for day traders.

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Gold 6 Months Chart as of 30 July 2023

Economic data from the U.S last week provided a strong Gross Domestic Product result on Thursday, and followed with weaker than expected Personal Consumption Expenditures and Personal Income statistics before going into the weekend. Meaning the U.S economy appears to be surprisingly solid, while inflation pressures do indicate they are in decline. The Forex market turned volatile on Thursday and Friday, gold which traded at nearly 1980.00 USD on Thursday went into the weekend near 1959.00.

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VIX Index 1 Year Chart as of 30 July 2023

Stock markets in the U.S via the major indices continue to incrementally rise and folks waiting for a big sustained selloff are having their patience tested. Perceived volatility in U.S markets is very low and the VIX (Volatility Index) indicates many investors are not taking the time to hedge with options because their confidence is remarkably high. A cautious reminder for traders, one bad day could change all of the optimistic sentiment.

In the cryptocurrency world, folks should continue to keep their eyes on the Binance exchange and its Binance coin. Many digital assets seem to be suspiciously close to important support levels as this week begins and appear vulnerable.

Monday, 31st of July, China Manufacturing PMI – while U.S data surprisingly improves, China has not begun to show signs of a positive turnaround quite yet, and this reading is expected to be below last month’s outcome. China data is a solid barometer of global economic health and traders should give these results proper attention.

Monday, 31st of July, E.U Consumer Price Index Flash Estimates – the European CPI numbers are expected to come in slightly below the previous month’s reading. If for some reason these inflation numbers are higher than expected, this could cause some chaos briefly for the EUR/USD. A weaker number however offers no sound wagering basis for short-term day traders either. Behavioral sentiment appears to be ruling the EUR/USD landscape for the time being, and technical levels should be watched.

Tuesday, 1st of August, Australia Reserve Bank Cash Rate – the RBA is expected to follow in the footsteps of the Fed and ECB and raise its lending rate by 0.25%.

Tuesday, 1st of August, E.U Manufacturing PMI – Germany and France are anticipated to produce similar results to last month’s outcomes. Recessionary pressures are a concern in the E.U and better than expected numbers would be welcomed, but this may prove difficult to demonstrate as economic conditions remain challenging.

Tuesday, 1st of August, U.S ISM Manufacturing PMI – the results from the manufacturing sector in the States should be watched. A slight improvement is expected, but the reading is not expected to produce a wildly optimistic result. An outcome which slightly beats expectations, but is not too strong might make the USD slightly weaker. Global investment institutions are likely hoping for any signs that the Federal Reserve will have to become less aggressive. A lackluster to ‘fair’ ISM Manufacturing PMI result could be evidence larger Forex traders want to see if they are aiming for bearish momentum in the USD.

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NZD/USD 3 Months Chart as of 30 July 2023

Wednesday, 2nd of August, New Zealand Employment Change – the jobs statistics are expected to show slightly weaker results from the nation. The NZD/USD remains within the lower elements of its long-term price range. There are many NZD/USD bullish traders waiting for a sustained reversal higher, but it is unlikely to be produced from these New Zealand jobs numbers.

Thursday, 3rd of August, U.K BoE Monetary Policy Summary and Official Bank Rate – the Bank of England remains in a difficult spot and it will likely raise interest rates by another 0.25%. Criticism of the Bank of England has been loud in Britain, but the BoE likely feels it has to remain in line with the Fed and ECB. Recessionary pressures continue in the U.K and inflation remains problematic. Concerns will be heard regarding property mortgages for home owners if the BoE hikes. The GBP/USD will certainly move depending on the rhetoric from the Monetary Policy Summary and talking points delivered by BoE Governor Andrew Bailey.

Friday, 4th of August, U.S Non-Farm Employment Change and Average Hourly Earnings – the jobs data parade will climax at the end of the week, this after starting on Wednesday via the ADP jobs numbers. Investors will watch the Non-Farm Employment Change data carefully and correlate them to the better than expected GDP results from the 27th of July. The wages data from the Average Hourly Earnings is expected to come in with a slight decrease. A weaker inflation result from the wages statistics could cause additional softness in the USD. However, recent data from the U.S has been hard to predict correctly, and day traders may want to sit on the sidelines until all the jobs numbers are digested.

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USD/INR: Consolidation Might Come to an Abrupt Conclusion

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

USD/INR: Consolidation Might Come to an Abrupt Conclusion

The USD/INR is trading near the 81.9750 ratio as of this writing and its price action since the 13th of July has produced a tight price range. On the 12th of July the USD/INR was trading around the 82.3000 region, this after being able to incrementally decline when a high of nearly 82.7900 was reached on the 6th of July.

Prior to the apex value of July, the USD/INR had traded in a rather consolidated mode from the middle of June until the first few days of July, essentially within a price realm the currency pair now lingers. Speculators must constantly fight the slightest of reversals if they are using too much leverage, but the USD/INR over the mid-term has produced interesting behavioral sentiment and this can be seen on technical charts.

While day traders may believe the current price ratios will hold and the potential interest rate hike from the U.S Federal Reserve has been digested into the USD/INR for this coming Wednesday, they might want to reconsider their thinking. No, the world is not coming to an end, Forex has dealt with U.S central bank decisions before and experienced traders understand the sudden potential of the USD/INR changing direction. The rather tight price range of the USD/INR could vanish in the coming days if the Federal Reserve begins to change their tone within the FOMC Statements.

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USD/INR One Month Chart as of 24th July 2023

U.S Federal Reserve is Likely to Raise the Federal Funds Rate but Perhaps Shouldn’t

The USD/INR may not get hit too hard when the U.S Federal Reserve delivers the anticipated 0.25% addition to the Federal Funds Rate. However, the FOMC Statement which talks about the Fed’s outlook might cause a change to what have been calm seas recently in the USD/INR. Recent U.S economic data has been rather troubling, but inflation does actually seem to be creeping lower. The Fed has been pretty adamant in their recent ‘whispering’ about raising interest rates in July, and the potential of raising again later this year.

Time for the U.S Federal Reserve to Start Sounding Dovish

Yet, recent data suggests the Fed should likely not even raise rates on the 26th of July and continue its pause. But having expressed plenty of verbiage on the subject, the Fed may not want to surprise financial institutions and may have to raise, even if they do not really have to this week. And here is where it gets interesting – the FOMC Statement may have to express this notion of becoming more dovish. Think of this potential hike to the Federal Funds Rate this week as the last dose of medicine for a patient who already feels better, the doctor (the Fed) is insisting that to make sure the ‘sick’ is cured another teaspoon consisting of an interest rate hike is necessary.

If the FOMC Statement sounds more dovish than expected the USD/INR might start to see selling ignite and a downturn generate. There are no guarantees and certainly the Fed’s actions this coming Wednesday are not known. Yet, if the Fed hints that it will not raise interest rates over the mid-term and wants to see if inflation continues to lower that it may consider the potential of no more hikes, the USD will start to get weaker across the board. In other words, this last dose of medicine from the Fed may give them the feeling to tell the patient (U.S economy) that they no longer need to visit the doctor’s office for a while.

Other central banks are watching too. Inflation in Europe and elsewhere remains high. The complications of weaker domestic currencies against the USD have hit many economies including India where inflation has been rather strong. If the Fed can now start to become less aggressive, the effect will be quick and start helping the USD/INR trade lower if healthy economic mechanics allow this to happen.

Support levels for the USD/INR near 81.8000 to 81.7500 should be watched, if these levels begin to see challenges and sustained prices remain nearby, the USD/INR may be signaling that another downturn is about to happen. If the U.S Fed delivers a cautious, but more optimistic FOMC Statement this coming Wednesday, the USD/INR may deliver a new cycle of selling.

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Federal Reserve Bank Decision and FOMC Statement Wednesday

by with No Comment Central BanksEconomic CalendarFeatured Highlights

Federal Reserve Bank Decision and FOMC Statement Wednesday

Monday, 24th July 2023, E.U Flash Manufacturing and Services PMI – a slew of Purchasing Managers Index readings will come from European Union nations including Germany and France. Projected outcomes are expected to show slight improvement in the Services readings and mixed results from the Manufacturing sector. The EUR/USD may get a momentary nudge from the published numbers.

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EUR/USD 3 Month Chart as of 23rd July 2023

Monday, 24th July 2023, U.K Flash Manufacturing and Services PMI – the British economic reports are anticipated to come in below last month’s readings. The U.K did report slightly better Retail Sales numbers last week, but a Consumer Confidence outcome was weaker than expected. The GBP/USD might react briefly to the U.K PMI data.

Monday, 24th July 2023, U.S Flash Manufacturing and Services PMI – the reports from the States are forecast to be below last month’s numbers. U.S data produced nervous and weaker economic insights last week from the Housing sector. The Federal Reserve will certainly give some attention to the PMI data as they try to gauge the strength of the U.S economy while likely preparing to hike the Federal Funds Rate on Wednesday. The PMI statistics could factor into the Fed’s outlook, which is the crucial ingredient that financial institutions want to understand and still have skepticism about while considering the Federal Reserve’s potential actions later this week.

Tuesday, 25th of July 2023, Germany ifo Business Climate – the results are expected to be slightly weaker than last month, showing businesses in Germany are not optimistic about current conditions and outlooks.

Tuesday, 25th of July 2023, U.S CB Consumer Confidence – the report is anticipated to show U.S consumers are feeling more confident about their spending habits. If this report is stronger than expected, it could be one final clue before the U.S Federal Reserve springs into action the next day.

Wednesday, 26th of July 2023, U.S Federal Funds Rate and FOMC Statement – most financial institutions are prepared for a hike of 0.25%, which would bring the key borrowing cost to 5.50%. This number has been anticipated for a handful of weeks and any deviation would cause volatility. Forex has largely priced in the rate hike. Speculators need to pay attention to the FOMC Statement regarding outlook regarding comments on inflation, growth and what the Fed is prepared to do moving forward.

Because U.S inflationary price pressures showed a decrease recently, many financial institutions are likely betting on a slightly more optimistic sounding FOMC Statement. The question is if the Federal Reserve will risk sounding dovish, or continue to voice disciplined rhetoric about its ability fight inflation as needed and keep a middle ground. For all the criticism of the U.S Federal Reserve if it can raise interest rates without causing a credit crunch on mid and small sized banks the remainder of the summer, that would be a victory – particularly if it is perceived the U.S central bank will not raise hike the Federal Funds Rate the remainder of the year. However, that remains to be seen.

Thursday, 27th of July, E.U European Central Bank’s Main Refinancing Rate and Monetary Policy Statement – the ECB is expected raise their key lending rate by 0.25% and back up their recent ‘tough’ and heightened rhetoric regarding inflation. Again, day traders should understand the interest rate hike to 4.25% has been anticipated and largely digested into Forex. The question is the ‘voiced’ concern from the ECB within its Monetary Policy Statement. Financial institutions will react to the ECB Press Conference led by Christine Legarde, which comes about half an hour after the release of the Monetary Policy Statement.

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USD/JPY 3 Month Chart as of 23rd July 2023

Friday, 28th of July, Japan BoJ Policy Rate and Outlook Report – the Bank of Japan is the one global central bank that marches to its owner drummer and this will not change in the near-term. The BoJ is expected to keep its policies of low interest rates in place, voice concern about inflation and likely say their ‘boat’ remains steady on the water. The USD/JPY will have reacted before to the rhetoric from the Federal Reserve in the middle of the week. Yes, the USD/JPY could see a flourish of volatility on Friday, but most of it will have likely been seen already on Wednesday and early Thursday.

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Profits: Business Ethics in an Age of Subjective Expediency

by with No Comment AMT MarketsBusinessFeatured Highlights

Profits: Business Ethics in an Age of Subjective Expediency

This article was originally written in the summer of 2006, Jeremy Blatch suggests current business governance remains shadowed by the same concerns.

Most of us in business today, be we entrepreneurs, professionals or key employees, recognize that our customers, clients and staff require us to act in their best interests and that our actions should reflect this.

A code of practice or some kind of ethical standard or guideline will be needed to ensure some degree of accountability and consistency. In this we encounter the first hurdle, as the degree to which corporate and governmental governance is superimposed by regulatory bodies on business, varies between industries, businesses, professional sectors and political divides.

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The effectiveness to which this is policed in reality depends on the will of those in supervision, and the willingness of those in business to conform to requirements. Many areas are of course not covered by statutory regulation and getting on with the daily running of a business requires constant decisions which often involve a degree of ethical consideration. In reality any ethical stance is at best subjective and open to subversion and expediency in the quest for profitability, which after all is the main reason for being in business in the first place.

Service providers that fail to make a profit irrespective of the quality of service that they offer will inevitably cease to be able to provide that service. But at what cost do we surrender integrity for the expediency of justifying a decision on the grounds of corporate strategy or profitability. And at what point does adopting a rigid ethical stance become a statement of moral judgment? Moralizing about the world and the problems faced by modern society has never been wise. Morality is also a subjective term, often influenced by personal experience and strongly held beliefs, but not necessarily shared.

When some of the world’s most successful entrepreneurs met recently in Monaco at the invitation of the BBC World Service and the international accountants, Ernst Young, to debate how to ‘feed the starving and save the planet’, there was broad agreement that amongst most people there is a distrust of corporate motives and skepticism of Corporate Social Responsibility, currently a trendy buzz word amongst the business elite.

Is not the sole responsibility of companies to make money, but at what costs? Does it really matter how they make money, after all is a woman with a starving child going to refuse a plate of food because it has been purchased with money from the sale of narcotics? If we have a view against investing in armaments, are we prepared therefore to open our borders to anyone who wishes to attack us for any reason, or do we wish for a society in which the strongest take all and those with weapons will be strongest?

Someone receiving a pension has strong views on the tobacco or gambling or arms production or certain drugs, and whilst they are quite happy to receive the pension income and rejoice at the level of payment, are they also prepared to self-select how the investment is managed? Business is fraught with hypocrisy in this area.

Google have weakened their ethical case by caving in to the demands of China for expediency. Brands like Nike and Gap are having their reputations challenged by allegations of sweat shop labor despite spending millions on marketing a different image. Yet people still keep buying their trendy brands. Walmart the most successful US retailer attracts more shoppers than any other store despite allegations of a poor record of employee relations. Does anyone care? Shoppers go where they can find the best quality at the keenest price.

One can make a difference in society without trying to gain the ethical high ground or slipping into moral judgment by simply giving away something you don’t need, to those who most need it. We have witnessed this last week two instances of philanthropist ‘walking the walk’ not just ‘talking the talk’ with Warren Buffet, one of the most successful investors of this century, donating much of his personal wealth to the Bill and Melina Gates Family Foundation. This injection of cash now gives the Gates Foundation around USD 30 billion, more than three times the total amount of charitable donations in the U.K, putting them with Andrew Carnegie, Henry Ford and John D Rockefeller, as the hitherto best known philanthropists of modern times.

A few days after the very public announcement of Warren Buffet’s donation, a U.K hedge fund has emerged as one of the U.K’s most generous philanthropists with a donation of around GBP 50m to charity assisting children in poverty. The Investors Forum, registered in Gibraltar, was created to give a highly professional service to investors covering the wider investment process. It comprises of an association of firms and banks committed to acting professionally, whilst giving something back to those most in need.

A unique investment concept called the “Solidarity Fund” will hopefully be launched from Gibraltar, which will give both corporate and individual investors the opportunity to make money whilst directly helping those in need. In today’s business world making a profit is essential for survival, but how we make it and what we do with it will determine what sort of people we are, and ultimately what legacy we will leave behind.

Jeremy Blatch is the Founder and Consultant of Ein Harod Family Office. You can find more of his articles at www.ehh.gi

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China and U.S Data Early and Important as Central Banks Fret

by with No Comment Behavioral SentimentCentral BanksFeatured Highlights

China and U.S Data Early and Important as Central Banks Fret

Monday, 17th July 2023, China GDP and Industrial Production – the economic numbers coming from China have shown steady signs of a downturn. Gross Domestic Product figures however are expected to increase this month, but some analysts may question transparency issues regarding the reported statistics. Industrial Production numbers are expected to fall, which on the surface may cause people to question any positive results from the GDP. Retail Sales will also be published on Monday. The housing market in China remains critically important in the nation and some borrowers appear to be suffering financial stress. While many global retail traders might not be invested in China, the nation serves as a good barometer for the world’s economy, particularly regarding consumer demand.

Monday, 17th July 2023, U.S Empire State Manufacturing Index – the New York based report is expected to have a negative reading. It should be noted June’s data came in stronger than expected. Another positive surprise outcome would continue to show economists are finding it difficult to gauge the U.S economy. Last Friday’s solid Consumer Sentiment reading from the University of Michigan highlighted the rather complex results from the U.S, weaker than expected inflation numbers are also factoring into a muddled sentiment. However, the Federal Reserve is still believed to be leaning towards another interest rate hike on the 26th of July. Day traders should remain alert.

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USD/CAD 3 Month Chart as of 17th July 2023

Tuesday, 18th July 2023, Canada Consumer Price Index – the inflation numbers from Canada are expected to show a slight decrease in the velocity of rising prices. The numbers are likely to affect the USD/CAD which is trading near lows last challenged in September of 2022.

Tuesday, 18th July 2023, U.S Retail Sales – considering last week’s improved Consumer Sentiment numbers recently from the States, demonstrating better retail results compared to last month will not be a surprise. Earnings season on Wall Street gets underway this coming week and solid Retail Sales numbers may help mid-term outlook regarding equities. However, behavioral sentiment is fragile.

Wednesday, 19th July 2023, U.K CPI – the inflation numbers from Britain are expected to show a slight decrease in the rate of price expansion, but any result above 8% via the broad data will not make many folks feel better. GBP/USD speculators should monitor the reports.

Thursday, 20th July 2023, U.S Existing Home Sales – the rising costs of mortgages in the States is having an effect on the marketplace. Signs of stress in housing is an intriguing barometer regarding the outlook for the American economy. Better Consumer Sentiment and Retail Sales mixed with less than glowing numbers from the housing sector could make for a troubling diet for traders to consider and act upon.

Friday, 21st July 2023, U.K Retail Sales – recessionary results are shadowing Britain. Poor results from the retail sector would not help behavioral sentiment, particularly if inflation numbers have continued to show they are unrelenting two days before. The Bank of England is in an uncomfortable spot, this as the GBP/USD trades near highs it last saw in April of 2022.

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Summertime Behavioral Sentiment Game: Who Do You Trust?

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Summertime Behavioral Sentiment Game: Who Do You Trust?

Have we started to reach a polite equilibrium within Forex, gold, equities and bonds for a moment? U.S CPI data just came in below expectations, the decrease of inflation pressures in the U.S will be welcomed. Price ranges are starting to show signs of polite trends in Forex and equities – there seems to be a recognition of basic ideas which are perhaps serving as factors that are ‘accepted’ in the broad markets. Please do not close your eyes for long, because conditions can change in a moments notice, but for the moment the USD is weaker.

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Gold One Month Chart as of 12th July 2023

The Federal Reserve could still raise its Federal Funds Rate at the end of July, though today’s CPI data outcome will create headwinds against that notion. There has been a wide voice given by folks who say the Fed shouldn’t raise rates again, and that real inflation will start to come down and that it is doing so now. The CPI has shown a decrease in U.S inflation – a larger drop than anticipated, which will certainly spur on USD weakness today. This confirms – momentarily – many analysts inflation outlooks who work in financial institutions not related to the U.S Federal Reserve and have been saying price pressures will recede. Yet, inflation is not dead yet and may still be heard. Stagflation is a genuine concern.

Tomorrow’s U.S Producer Price Index will be another opportunity to stir sentiment. Remember folks, outlooks are often adjusted according to facts. But what are facts? Can we really trust them. What are leading indicators, what is data that looks forward instead of backwards – numbers are often offered as evidence but randomness often rules interpretations of data. How do acceptable outlooks really develop when data management and outlooks can change within split seconds depending on the team looking over the quantified math. Humans are naturally optimistic, even when the data is negative, this can lead to bias.

We are in an age when trading software is doing a majority of the large volume transactions, and has been coded by algos processed by quant teams in financial institutions. Do retail traders even have a chance in this type of environment? Yes, retail traders can still manage to find opportunities, but they need to combine technical perceptions with fundamental knowledge of data, and combine the two into a behavioral sentiment outlook depending on their time horizons.

Market dynamics and situations change a lot in the broad markets. Assets move depending on the bias of incoming data. Preconceived notions being acted on and then changing according to need can be done in microseconds because of existing trading technology that financial institutions use. Larger players have an advantage and they are not about to give this up. Timeframes are also different for big trading houses compared to small speculators. It is also important to stress institutional traders could care less about day traders in Forex.

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GBP/USD One Month Chart as of 12th July 2023

We have finished nearly a month of summer trading and seem to be confronted by a question of who do we trust? Do we trust the U.S Federal Reserve and its decisions and outlooks? In my opinion, you shouldn’t. But you should also remember the old adage, do not fight the Fed. The U.S central bank is bigger than you and I.

Central banks work together and often coordinate their combined outlooks, while shadows cast from the ‘oversight’ of political leaders rhetoric are frequently given consideration by the Fed, BoE, ECB and BoJ officials even if they claim they are not listening. Inflation is not welcomed by central banks, but because they are largely reactive and not proactive the Fed and others sometimes look uncaring and like fools, while the public sometimes suffer.

Thus we sit and wait for central bank pronouncements, but for the moment we seem to have a good grasp regarding what they will say. And perhaps – for the moment, maybe that is why Forex, gold and equities are trading rather politely. We seem to think we know what is going to be said moving forward for the next few weeks and remainder of the summer – more of the same warnings and interest rate correlations sprinkled in via central bank diatribes.

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Ten More, OK, Now Twenty, Finish Thirty, Next Run the Hill

by with No Comment Behavioral SentimentBooksFeatured Highlights

Ten More, OK, Now Twenty, Finish Thirty, Next Run the Hill

Book Corner: Living with a Seal: 31 Days Training with the Toughest Man on the Planet, written by Jesse Itzler

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Living with a seal | Jesse Itzler

We all have had days where we couldn’t get out of bed to exercise, whether it be going for a morning run or hitting the gym at opening time. What would you do if you had a former Navy SEAL living with you and training you twenty-four hours a day, seven days a week for an entire month? And with the agreement that you had to do everything he said – every gym rep, every run, push-up, pull-up and burpee?

In Living with a SEAL: 31 Days Training with the Toughest Man on the Planet, a true story, that’s exactly what happened to author, former rapper, and entrepreneur (part owner of the NBA’s Atlanta Hawks) Jesse Itzler.

Itzler met the SEAL at an ultramarathon where the latter dominated. Itzler refers to the man only as “SEAL” and never reveals his identity, although it has become known since the book’s publication and SEAL has become a well-known fitness celebrity and author in his own right. Impressed by his astonishing physical shape, steely-eyed grit and laconic demeanor, Itzler inked a deal for SEAL to move into the Manhattan apartment where he lived with his family and train him for one complete month in the only way that SEAL knows – hard and nasty – where your limits are constantly pushed to the maximum.

Despite being a fitness buff, Itzler is yanked out of his comfort zone and challenged from day one. This begins a month of exercise sessions on a level that Itzler previously never experienced, such as grueling runs in and around Central Park with endless hills and thigh-splitting sprints in the frigid NYC winter. Other times, SEAL would command Itzler to do endless sets of upper body work comprised of weights, machines, and military-style calisthenics, sometimes on a moment’s notice or little to no sleep. And with SEAL, failure was not an option.

Itzler kept a diary during this month and the book is formatted as such. Additionally, each chapter begins with a SEAL quote. One of my favorites was, “you can get through any workout because everything ends.” And then there are thoughts on people and interaction gems like, “I don’t like to talk to strangers. Actually, I don’t like to talk, period.”

Despite the tortuous sessions that he endured, Jesse Itzler relates it all with humor and of course pride: his fitness level improved tremendously. He treats SEAL with great respect and admiration, something that we, as readers will share. SEAL comes across as a man of integrity who is true to his word. And how can one not admire a man who talks little, eats little, needs very little to get by in life, and runs in five-degree Fahrenheit weather wearing only gym shorts and a T-shirt?

The book is quick, light, and enjoyable. It’s also quite motivating. After reading it, you’ll be laying out your running clothes and setting your alarm clock for five in the morning.

If you want to read another Book Corner article, please visit this review by Evan Rothfeld: https://www.angrymetatraders.com/post/the-despair-of-ice-and-ability-to-lead-people-through-storms

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Week Ahead: Inflation will be the Crucial Word for Investors

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Week Ahead: Inflation will be the Crucial Word for Investors

Last week finished with another reminder that inflation cannot be easily scoffed at by investors who continue to believe higher prices will eventually slowdown. Average Hourly Earnings last Friday came in above the expectation and this was enough to rattle Wall Street again, which saw the major equity indices decline and bond yields incrementally rise. Inflation ‘talk’ will remain important this week because of coming U.S data.

Real Estate including REITS becoming a Topic of Discussion as Mortgages Rise

Market watchers should also pay attention to news regarding mortgages on residential homes, and listen for troubles from the commercial real estate market, as these sectors deal with rising interest rates in the U.S and U.K. Increased nervousness within these markets could have an affect on behavioral sentiment. Let’s remember the catalyst for the financial crisis of 2007 was the real estate sector.

Which brings us back to inflation and the growing acceptance among investors the U.S Federal Reserve may be ‘forced’ to hike the Federal Funds Rate on the 26th of July, if price data continues to come in ‘hot’. Some investors will likely be heard saying an increase of 0.25% has already been factored into marketplace, but the prospect of another hike in late 2023 could be problematic. Forex, gold and bonds dynamics will tell us a lot when this week concludes regarding outlooks.

BNB/USD Price Should be Monitored as Binance Trembles

An outside source of financial and speculative news is likely to come from cryptocurrency. If you are gambling on this asset class (or should we say commodity based on hot air) and like the adventure of wagering, please continue to pay attention to Binance which is showing signs of duress. If the Binance cryptocurrency exchange shows additional signs of pressure on its BNB (Binance Coin), trading waters within the world of crypto could trigger additional drowning victims. If you thought the Sam Bankman-Fried story made interesting news last year regarding fraud and other criminal activity, the FTX saga could prove to be only the tip of the iceberg.

Data Events Ahead to Watch

Monday, 10th of July, China CPI and PPI – the inflation data could prove important for investors who correlate economic statistics from China into their global forecasts. Traders within India should pay attention to these Chinese price reports, because global investors are starting to shift their assets into the Nifty 50 and other NSE equities because of risk and reward equations.

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GBP/USD One Month Chart as of 9th July 2023

Tuesday, 11th of July, U.K Claimant Count Change and Average Earnings Index – the numbers need to be watched by GBP/USD speculators. The results from the U.K will be intriguing because of employment results, but more importantly for inflation concerns and the knock-on effects. Bank of England Governor Andrew Bailey is speaking a few times this week, and this includes Wednesday the 12th of July, when he will talk about the Financial Stability Report. The GBP/USD has moved towards monthly highs recently.

Wednesday, 12th of July, New Zealand RBNZ Official Bank Rate – NZD/USD day traders will want to pay attention to the central bank’s Rate Statement. While no increase of interest rates is predicted, the Reserve Bank of New Zealand at a minimum will likely have to admit inflation remains a concern.

Wednesday, 12th of July, U.S Consumer Price Index – the inflation reports from the States will have all eyes on the outcomes of the monthly and annual comparisons, including the Core numbers. The results from these inflation statistics will certainly cause momentary volatility within Forex with the USD as the focal point.

Wednesday, 12th of July, Canada BoC Overnight Rate – the Bank of Canada is expected to hike its interest rate by 0.25% to the 5.00% mark. USD/CAD will react to the BoC Rate Statement based on its outlook.

Thursday, 13th of July, U.K Gross Domestic Product – the ‘growth’ numbers are not expected to be positive. A drop of minus -0.3% is the expectation. Talk of recessionary pressures in Great Britain will be heard. Unfortunately, the discussion about a struggling economy, mixed with stubborn higher prices for consumers and mortgage rates that are rising will not make for calm stomachs. U.K equity results via the FTSE 100 Index should be monitored.

Thursday, 13th of July, U.S PPI – the Producer Price Index figures will be the last cog within the important inflation data for the week. Stubborn prices for wholesale goods are a concern, because the costs to consumers becomes more expensive when there are higher price pressures.

Friday, 14th of July, U.S Consumer Sentiment via the University of Michigan – if the Consumer Sentiment readings from the UofM report improves, and the U.S inflation data which was released earlier this week has proven stubborn, this could become a source of pain for investors who may be forced to consider the Fed will not only raise the Federal Funds Rate late July, but later in 2023 also. Short-term traders should monitor this report accordingly.

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Risk Friday: Fear is a Terrible Thing to Waste

by with No Comment AMT MarketsCryptocurrenciesFeatured Highlights

Risk Friday: Fear is a Terrible Thing to Waste

Behavioral sentiment in the broad markets took a turn for the worse yesterday among many major equity indices. This as financial institutions seemingly came to the short-term conclusion the Federal Reserve may actually have to raise interest rates again on the 26th of July, and possibly beyond. Meaning, the Fed might actually back up what it has been saying.

Yes, investors have been warned many times already by some analysts that the handwriting was on the wall regarding additional increases to the Federal Funds Rate, but it seems a fear of losing out has kept many market participants actively running forward with blinders on not cognizant of the Fed’s rhetoric.

Day traders should always be mindful of their emotions. While it is not good to trade based on emotions when involved in an active position, intuition and gut instinct sometimes can save you money when you decide to simply sit on the sidelines and watch the market action instead of participating. In other words, if you are nervous and your instinct is bothering you – do not attempt to enter the trade.

U.S Data Remains Rather Strong even as Inflation Boils

Yesterday’s better than expected jobs report via ADP helped create sparks early regarding U.S economic data continuing to show it is robust, but the ISM Services PMI threw gasoline onto the fire with a much better result of 53.9 compared to the estimated reading of only 51.3. While inflation simmers in the U.S, signs of limited growth abound too making stagflation a real danger.

Investors can now attain a yield around 4.995% on 2-year U.S government Treasuries. A gain of nearly 5% that is almost assured with very little costs regarding commission rates needing to be spent, looks like a solid short-term investment to many. Equity markets have a reason to feel spooked. If the U.S Fed raises the Federal Funds Rate which is now 5.25% to 5.50% at the end of July, and at the same time continues to speak in an aggressive manner about other potential hikes later this year, summer may lose its sense of tranquility for financial institutions.

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Gold Five Day Chart as of 7th July 2023

Gold which was trading at nearly 1925.00 USD yesterday, suddenly fell to around the 1900.00 briefly in the wake of the better U.S economic data, showing investors are worried the USD has some additional strength to display potentially. Again, the results of intraday gyrations may not mean a lot to mid and long-term investors, but day traders speculating on the outcome of quick hitting results frequently get hurt by the bursts of volatile storms.

U.S Official Jobs Numbers Today and Anticipation

Adding another dose of intrigue to the day are the upcoming official jobs numbers from the U.S, including the Non-Farm Employment Change and the Average Hourly Earnings reports. The inflation data via the earnings statistics are anticipated to show a gain of 0.3%, if for some reason it comes in stronger than expected this could create more fireworks. Having said that, the Wall Street Journal reported yesterday that Americans appear to have stopped quitting their jobs in order to switch to similar competitive positions as much as they had been the past couple of years. Perhaps this signals wages are starting to cool or least will in the near-term.

Let’s also remember that yesterday’s selloff in equities may have been anticipating better Non-Farm Employment Change results today based on the ADP outcome Thursday, and other solid U.S data before like last week’s GDP gains. Day traders betting on quick hitting CFDs via their brokerage platforms should be careful today and listen to news regarding the U.S bonds market. Inexperienced speculators should try to understand the adage – buy the rumor and sell the fact. Meaning ‘smart money’ often acts before others and takes advantage of their outlooks regarding data.

Quick Warning on Binance and Cryptocurrencies for Gamblers

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BNB/USD Three Month Chart as of 7th July 202

In a non-related subject, cryptocurrency traders seem to remain rather steady but should be nervous – if anyone is actually really trying to speculate in this endeavor besides Larry Fink of BlackRock currently, news regarding Binance remains troubling on the surface as legal clouds grow. Folks involved with the BNB coin should be careful. As one of the most ‘important’ crypto exchanges Binance’s legal problems moving forward could affect the prices of cryptocurrencies significantly. As of this writing BNB/USD is at nearly 233.00, and it should be noted Tether’s USDT appears to remain rather solid for the moment at 1.00. A look at the current three month chart of BNB/USD highlights its latest value struggles.

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USD/INR: Bounce Higher Ignites a Return to High Water Values

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

USD/INR: Bounce Higher Ignites a Return to High Water Values

The USD/INR is trading near 82.4350 as of this writing, which is a value the currency pair has not touched since the second week of June. While some analysts may say the move to higher ground yesterday and early this morning is based on the U.S FOMC Meeting Minutes, Wednesday’s report from the Federal Reserve likely only reinforced the bullish momentum which started earlier this week. The world of Forex can feel fickle, particularly when so many of the internal dynamics are hidden from a large segment of people who are trying to speculate on the results.

If the mechanics of the move higher which started on Monday are examined a couple of points should be considered closely, the low of the USD/INR was around 81.7300 on the 3rd of July. This low took place as most U.S financial institutions were on holiday in preparation for Tuesday’s 4th of July celebrations.

Fears of U.S Economic Prospects: Behavioral Sentiment and Stagflation Potential

The reversal higher since the 3rd of July has been pronounced, but before going into last weekend the USD/INR was largely trading within a consolidated manner near the 82.0000 level with a test of this mark having been displayed forcefully since the middle of June. A range of nearly 81.8500 to about 82.1500 largely has played out the past three weeks of Forex trading.

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USD/INR One Month Chart as of 6th July 2023

Monday’s dip in value to lows around 81.7300 took place when there was very little volume in the USD/INR market. The depths challenged marks not seen since the first week of May.

The reversal higher the past few days is certainly part of more transactional volume starting to be pumped into the USD/INR as U.S financial institutions have returned, but they are also likely being caused by an underlying nervousness within the Forex markets which may be factoring in the notion the U.S Federal Reserve seems to be on a path which will increase the Federal Funds Rate on the 26th of July.

The behavioral sentiment being generated regarding a Federal Reserve which stays in an aggressive stance started before yesterday’s release of the FOMC Meeting Minutes. Nervous conditions have been on the surface of the broad markets because U.S inflation remains rather resilient – but also importantly because last week’s Gross Domestic Product numbers published on the 29th of June, came in stronger than anticipated. From a troubling perspective some analysts could point to the moderately improved growth and combination of stubborn inflation as a sign stagflation is starting to shadow the U.S, which would certainly be a troubling predicament.

USD/INR Move to New Highs this Morning could Ignite more Nervous Reactions

USD/INR speculators may believe the move higher in the currency pair is overdone and that values need to be lower. However, the current price of the USD/INR is one that has been experienced quite a bit since October of 2022. A look at a one year chart shows the USD/INR has returned to higher ratios of its price range which it has experienced since breaking upwards in the middle of September 2022. And to make things more interesting for technical traders, the USD/INR has actually produced a rather stable range between 81.6000 and 82.9000 since February of this year.

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USD/INR One Year Chart as of 6th July 2023

While traders are certainly trying to anticipate what will happen next in the USD/INR to gain an advantage, they should remember the currency markets are almost impossible to time on a daily basis, but a look at mid-term prices does offer plenty of insights. If the USD/INR climbs too high, perhaps to the 82.5000 level the Reserve Bank of India could get a bit nervous and consider some type of intervention which it supposedly has done a few times over the past handful of months – but perhaps at higher price ratios.

USD/INR Mid-Term Considerations and the Current Price Range

However it is more cost efficient and reputably less damaging for central banks to not intervene if they do not have to, and simply let market dynamics effectively create a price for the USD/INR based on supply and demand. Meaning the current prices of the USD/INR look to be rather high, but taking into consideration the range of the Forex pair the past five months the values are not new. The prices in fact have been rather established, meaning the USD/INR may trade slightly higher, but then a lower wave of downward momentum could be anticipated.

Day traders who are gamblers may be tempted to sell the USD/INR if the currency pair finds more upwards mobility in the near-term. Trading volumes should be back to normal now that U.S financial institutions have returned from their holidays, and traders should be ready for the potential of fast price velocity developing. Risk management on wagers regarding the USD/INR are essential as always.