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AMT Top Ten Miscellaneous Wonders for the 12th of April 2024

by with No Comment AMT MarketsArtificial IntelligenceFeatured Highlights

AMT Top Ten Miscellaneous Wonders for the 12th of April 2024

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10. Free Press: Brazil and the Lula de Silva government are cracking down on dissent in social media. ‘X’ – formerly Twitter – led by Elon Musk is fighting back and refusing to cooperate as Brazilian ‘leadership’ attempts to intimidate the ‘loyal opposition’ in the legislature.

9. GROOT: Nvidia is working on ‘humanoid’ robotics. Project GROOT was presented by Jensen Huang at the GTC Conference. The synergy between machine learning, semiconductors and robotics is an evolution taking place before our eyes. Tesla is involved in similar research as it works on Optimus.

8. Hot Chocolate: Speculation in Cocoa has brought the commodity above 10,400.00 USD per metric ton as of this writing. Questions about gravity and hypersonic speculative values are logical at this juncture.

7. Seclusion: Do humans still need each other? People are relying on their mobile devices for social interactions. Robotics with AI capabilities will make our existence potentially more lonely. Open source software DOBB-E will be part of this future as household chores are taken care of by ‘machines’.

6. Iran: Those with holiday excursion plans which include Teheran this weekend may need to check on ticket availability due to the possibility of flight cancellations.

5. Fed Liberty: President Joe Biden this week spoke about an interest rate cut coming from the Federal Reserve this year, yet Consumer Price Index statistics are demonstrating escalating expenses. Current U.S government leaders may want to spend less on ‘vote buying’ via student loan forgiveness and think about conservative fiscal practices. Why should Americans who choose not to attend universities pay for those who did via higher taxes? Are Fed and Treasury officials still independent?

4. Risk Averse: Gold is within sight of 2,400.00 USD this morning. In the meantime U.S bond yields have inverted completely except for the 30-Year issue. Financial institutions are showing nervous behavioral sentiment.

3. USD Centric: Forex has seen reactive trading this week as financial institutions begin to conclude the U.S Federal Reserve’s monetary policy ‘over time’ will remain disturbingly difficult and full of doublespeak.

2. Caution: Mixed results are flourishing in the major U.S stock indices as the Nasdaq 100 and S&P 500 touch late March values, and the Dow Jones 30 has returned to February levels. Higher than anticipated interest rates are causing turbulence.

1. Energy Illusions: As the prices of food, transportation and housing escalates isn’t it time governments start to question their ‘green’ policies which are making the costs of energy production more expensive? We all want a clean planet, but logical strategies must be applied to create efficient use of resources.

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Risks Ahead and Turkey as the USD Gets Speculative Attention

by with No Comment AMT MarketsAssetsFeatured Highlights

Risks Ahead and Turkey as the USD Gets Speculative Attention

The USD stumbled last week as inflation numbers via the Consumer Price Index and Producer Price Index both came in slightly below expectations. Yes, inflation is still dangerous in the U.S, but an erosion of momentum has certainly been hoped for by financial institutions, and they clearly took advantage of the CPI and PPI reports and helped a selloff of the USD build momentum.

The Federal Reserve is now highly anticipated to begin lowering the noise of its aggressive rhetoric, and actually start to sound more neutral when December’s FOMC Statement is delivered. Yes, this is speculative and things can change, but financial institutions like speculators position their assets based on outlooks.

Equity markets in the U.S also showed that there is growing risk appetite which wants to be part of the moves higher in the major indices. The NASDAQ 100, the Dow Industrials 30 and S&P 500 have all sustained upwards movement and are at three month highs with additional upwards targets clearly in sight. However, before day traders try to hop onto the higher trajectory they should remember the speculative timeframes of institutional investors are different than their own. Fear of missing out could feed into buying momentum, but caution is needed.

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GBP/USD Six Month Chart as of 20th November 2023

The GBP and JPY look to be intriguing opportunities for traders with a capacity to hold positions over the mid-term. Having struggled since July of this year, financial institutions are likely looking at these two currencies as having been oversold. Many other major currencies are all rather speculatively attractive at this time, but again, day traders should not wager blindly and keep realistic targets for their short-term wagers.

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USD/JPY Six Month Chart as of 20th November 2023

The U.S will celebrate its Thanksgiving holiday this Thursday. Volumes across the broad markets will begin to drop significantly on late Wednesday, and full trading will not return until Monday or Tuesday of next week until the U.S turkey meals have been digested. Meaning that while risk appetite has certainly begun to creep in the broad markets again, forecasts this week should be treated carefully. Day traders should watch momentum today and tomorrow, if the USD remains weak going into Wednesday, this could signal further weakness in the USD is anticipated. Yet, the dangers of near-terrm reversals exists and speculators should not get over confident.

U.S Treasury yields remain near their five day lows. The price of gold is range trading below its highs made late last week, this as the USD has shown weakness and risk adverse global concerns have also become more calm. Trading results later this week should be viewed suspiciously, price velocity when unbalanced positions are executed often leads to spikes during the Thanksgiving holiday, like the Christmas holiday which will follow in a little more than a month.

Monday, 20th of November, Germany PPI – the inflation data has already been published and the Producer Price Index came in at minus -0.1%, which was below the estimate. Global economic data the remaider of today will be rather light, and behavioral sentiment being generated from U.S markets should be watched.

Tuesday, 21st of November, U.S FOMC Meeting Minutes – this report which will be published late on Tuesday for many global traders, may provide evidence to previous thoughts regarding the outlook for the U.S economy regarding inflations impact on monetary policy. Meaning that if there are signs that FOMC members were already talking about the notion that inflation was eroding last month and was expected to continue to decline further – this could feed into weaker USD outlooks mid-term.

Wednesday, 22nd of November, E.U ECB Financial Stability Review – this report will have limited impact because Forex will remain USD centric. The EUR, like the GBP and JPY, is showing signs of a recovery based on the notion of having been oversold. Traders should be cautious about the EUR/USD later this weeek because of the U.S holiday and expect volatility.

Wednesday, 22nd of November, U.S Core Durable Goods Orders, and Revised Consumer Sentiment via University of Michigan – both these reports may fall on a U.S marketplace that is preparing to escape for the long holiday weekend. Last week’s weaker than anticipated Retail Sales numbers will combine nicely with the Consumer Sentiment reading, but again its affect may be muted. If the Core Durable Goods Orders number meets expectations or comes in with a slightly less than expected statistic, this could help continue to create weaker USD outlooks.

Thursday, 23rd of November, U.K and E.U Flash Manufacturing and Services PMI – the reports from Great Britain and the European Union are expected to show stable results, but also that purchasing managers remain unimpressed by the prospect of future demand over the mid-term in Europe.

Friday, 24th of November, Germany Business Climate via ‘ifo’ – this report is expected to be better than last month’s outcome. If the result is stronger than expected this could help the EUR/USD going into the weekend.

Friday, 24th of November, U.S Flash Manufacturing and Services PMI – both reports are expected to be slightly weaker than the last month’s numbers. U.S trading will be limited before going into the weekend. Yes, many markets will be open but volumes will be sparse. This could set the table for a reaction early next week if financial institutions believe they can take advantage of Forex, equity and commodity markets that became unbalanced during the Thanksgiving holiday celebrations.

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Trading Tactics to Add to Your Risk Management Knowledge

by with No Comment Behavioral SentimentFeatured HighlightsRisk Analysis

Trading Tactics to Add to Your Risk Management Knowledge

Retail traders seeking quick speculative positions are not the masters of the financial world. Institutions which day traders are hoping to reflect are the real shakers of the markets. Understanding your actual place in the world of trading is crucial, accepting this point and putting ego to the side will create a better grasp of behavioral sentiment as you interpret combinations of fundamentals and technical perceptions and merge them into your risk taking.

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Making your decisions with the acknowledgement of your place in the trading world is important. Your 10,000.00, 50,000.00 and 100,000.00 USD value based positions are very small fish in a large ocean. Your trades are very unlikely to affect market direction in any meaningful manner. The more leverage you use makes your available ‘margin’ prone to failure.

Risk analysis is vital for day traders, guarding you money should be a fundamental aspect of your tactical decisions. Deep pockets are not luxuries most day traders have.

If you happen to have a solid amount of money to speculate with it will assist you, but you will still need to practice solid risk taking strategies.

Plenty of rich folks have lost all of their money trading, that isn’t written to make you feel better, it is written as a warning and highlights that speculating is dangerous when not done with a solid plan of action. Once a trade is placed your work than immediately doubles via responsibility, because you have ‘skin in the game’ and need to manage your emotions and thinking as the markets move.

Metallgesellschaft and Barings Bank are two prime examples of two institutional traders who made vital mistakes with risk management and lost everything in the 1990’s. Protecting cash reserves are vital for all. Metallgesellschaft and Barings did not supervise their traders and ‘hoped’ that all things would work out in the end, because they had the false notion institutionally that their capacity to hold onto positions that were not profitable would eventually turn into positive results. Their losing trades caused the destruction of their enterprises.

Most speculators by nature are optimists. After all day traders are gambling on the movement of assets they believe they have a correct perspective regarding future direction of value. In order to wager a trader needs to feel confident regarding their outlook, otherwise they would not pursue currency trading. The same can be said for equities and indices, commodities and all other financial assets. False hope can destroy the efforts of all traders and they must be alert to perspectives which can lead to detrimental results as they trade.

Too much leverage, no real insights about direction, and trading based on ‘noise’ that influences and causes you to make unwise decisions are dangers. It might be boring to constantly be told to be careful, a bit like a parent warning you when you were little to act in a certain way. Good risk management while day trading is vital for surviving and finding success.

Do not be stubborn. In trading no matter if it is Forex, CFDs with equities, indices, commodities or cryptocurrencies you should not ‘marry’ your position blindly. If your trading position begins to show signs of potentially failing and you have concluded you are wrong – end the trade asap.

However, at the same time do not make your decisions based on emotions which may create whipsaw reactions regarding your choices. Having solid goals before going into a trade will help you eliminate emotional stress.

Have price targets and a strategy for getting in and out of trades. If the trade is going in your direction, then protect your profits by either cashing out of the trade, or raising your stop loss to a place that you are actually still going to make money. Some trading platforms may allow you to raise your stop losses – this is called a ‘trailing stop’. If you are lucky enough to catch a trend at the correct time and it is being sustained, using a ‘trailing stop’ is a solid risk management tactic and can protect your profits.

If the trend in your position starts to reverse against you, do not cancel your ‘trailing stop’ because you think the reversal is a momentary cycle. Trading floors are littered by people who had substantial gains and then watched them vanish, all because they thought the market would reverse in their chosen direction again. Folks dream about owning a castle when all they need is a comfortable home. Cancelling stop loss orders is a sure way to the poor house.

Immodest ambitions can ruin your trades when you become stubborn, unrealistic and emotional. Make sure you stay ‘grounded’ and are pursuing trades because you believe in them, and not because you are looking for price action to fill up a boring day with wagers than make no sense.

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Friday Barometer Regarding the BoE Decision and Gold Prices

by with No Comment AMT MarketsAssetsFeatured Highlights

Friday Barometer Regarding the BoE Decision and Gold Prices

The Bank of England’s rate hike of 0.50% cements the notion that global central banks remain steadfastly locked on inflation, and understand politically the implications on the public regarding higher consumer prices which are being experienced. The Bank of England ‘met’ before its Official Bank Rate announcement with corporate bank executives it was whispered, to discuss their concerns regarding the knock on affects of higher mortgage rates to come. However, this did not stop the BoE from being aggressive.

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GBP/USD Three Month Chart as of 23rd June 2023

Is the BoE Move a Sign Regarding the Fed’s Next Decision?

The move by the BoE also is intriguing because the larger than expected hike puts into play the notion the U.S Fed may be raising the Federal Funds Rate in July. The reasoning is based on the idea the Bank of England wants to protect the British Pound from another interest rate hike from the Fed, thus ‘securing’ the value of GBP/USD Forex mechanics.

The U.S Federal Reserve, the BoE and ECB finally seem to have a grasp on import inflation implications. Although higher costs and dynamic pressures on exporting countries like China, India and others that face the gauntlet of these challenges remains critical, because these nations need to raise the costs of manufactured goods internationally when they sell.

Smart Money and the Value of Gold

Let’s talk about ‘smart money’ for a moment surrounding Gold – and please try to hold down your laughter – but the price of the precious metal is interesting and should be monitored even by folks who do not trade the commodity. Gold as of this morning is near the 1915.00 USD ratio.

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Gold Six Month Chart as of 23rd June 2022

On the 4th of May the price of the precious metal momentarily challenged the 2080.00 level. On the 1st of June the price of the commodity was near 1985.00. Do you see a trend here? Please note, Gold isn’t going to zero.

The point to be made is that the build up in the price of the precious metal from the 22nd of November 2022 when Gold was around the 1625.00 USD per ounce level, until early May anticipated the U.S Federal Reserve was going to become more dovish regarding their interest rate polkicy. For consideration look at the price of the USD during this time too, against many major currencies – the value of the USD also started to come down.

‘Smart money’ is showing signs of nervousness certainly since the start of June that more hikes are feared from the Federal Reserve. However, the price of Gold and the USD are not correlating well at this moment. This is a potential sign that Gold and the USD are both within speculative trading zones in which financial institutions are seeking ‘true’ equilibrium and are not comfortable. Fragility in the financial marketplace is likely to be seen until the Federal Reserve Federal Funds Rate announcement late in July. Expect financial institutions to price in their outlooks respectively depending on their outlooks.

Gold and U.S Treasuries: Inverted Interest Rate Implications

Gold definitely fluctuates within daily trading conditions, it is a speculative commodity, but it is also a solid barometer of risk management among the elite. If financial institutions are in favor of buying items like U.S bonds because of their guaranteed short term interest payments (look at the fact U.S Treasuries are mostly inverted – meaning shorter term bond interest rates are paying higher returns compared to longer term bonds) instead of buying Gold as an investment tool.

The Gold and USD Forex dynamics tells us that investment institutions are still very nervous about the Fed potentially raising interest rates a couple of more times this year. July and late this year appear to be reasonable bets. This Fed consideration and concern remains legitimate while looking forward as long as inflation remains elevated in the U.S. However, the Federal Reserve must also feel comfortable they will not kill mid and small sized banks, which by now should have shifted their business practices allowing for slightly higher interest rates to be delivered.