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India Insider: Reserve Bank of India Intervention is Limited

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

India Insider: Reserve Bank of India Intervention is Limited

After weeks of steady appreciation due to Reserve Bank of India intervention on the 15th of October, the Indian Rupee has now returned to the same 88.72 levels against the USD before the policy action was enacted. The RBI’s recent offensive against speculators may have calmed the market temporarily, but it reflects a reactionary and short-term approach to deeper structural pressures facing India’s external administrative policies regarding the USD/INR.

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USD/INR Three Month Chart as of 5th November 2025

Despite the Reserve Bank of India’s efforts to influence the cash forward market, where Dollar shorts rose by 6 billion USD in September to $59 billion, fundamentals suggest that Rupee weakness is not purely speculative. It is a rational market adjustment due to rising trade barriers amid U.S tariffs on India’s merchandise exports. The added uncertainty regarding trade caused the Rupee to naturally absorb external shocks. Merchandise exports to the U.S fell 12% in September year on year, according to official India data, prompting some calls for government relief.

India’s Foreign Remittances & H1-B Visa Fee Hike

According to World Bank data, India received about 137.7 billion USD in personal remittances from abroad in 2024. From that amount, around $40 billion is coming from the United States. The Trump administration raised the cost of H1-B visa fees from below 10,000 USD to nearly $100,000. And there is now also an increased likelihood of measures aimed at limiting digitally delivered software services to the U.S from India. These combined measures would substantially reduce Dollar receipts via exports of technology driven software and IT services, as well as remittances from a reduction of workers on temporary U.S visas providing on site services to U.S clients. USD inflow has been crucial for India’s balance of payment’s stability.

Reduction of USD reserves when the trade deficit is already rising because of hikes caused by tariffs on India’s exports would widen the current account deficit. Concerns about a decrease in remittances leading to a potentially significant decline of India’s USD reserve ability is possibly discouraging the India Reserve Bank to voluntarily expend reserves to support the Rupee.

Service Exports Cushion India’s Balance of Payments:

India’s total service exports touched 400 Billion USD over the past year with a predominant amount coming from the U.S. In other words, India has had a $202 billion in services trade surplus over the last 12 months, which covered almost 114% of India’s merchandise trade deficit in 2024-25.

India’s goods trade deficit is matched by a services surplus, plus net foreign personal remittances. This USD equation is under threat because of prolonged paralysis from stubborn US and India trade negotiations debating Russian Oil usage and the U.S demand to allow agricultural products into India.

Foreign Investors Selling Indian Equities

In addition, the Indian Rupee is not getting support from investment portfolio inflows. A shortfall of AI related avenues in the nation’s tech sector, and perhaps because of valuations considered too rich, foreign Investors have pulled 17 billion USD so far this year. This sum is more than any other emerging market, which is eating away at the Reserve Bank of India’s FX reserves too.

Global and India-specific uncertainties spurred by the Trump administration’s actions are setting off a retreat of footloose portfolio capital invested into India’s equity and bond markets. If the Reserve Bank of India was confident that inflows of foreign capital would replenish reserves it would likely help the Indian Rupee, and thus investor confidence coming from abroad.

Policy Irony and the Limits of Intervention

The U.S. remains India’s largest export market, but new levies of 50% tariffs are hurting labor-intensive sectors such as textiles, leather, footwear, and gems & jewelry.

While concerns about imported inflation are valid, the benefits of a weaker Rupee should not be overlooked. A mild depreciation could boost India’s service exports, improve the balance of payments, and partly offset the effects of U.S. tariffs on merchandise exports.

A material improvement in U.S and India trade relations is needed. Until a restoration is achieved in relations and a merchandise surplus is possible, alongside healthy services and remittance inflows occurring again, the Rupee’s weakness is likely to persist. In the meantime, Reserve Bank of India interventions could prove to be a short term tactic that proves vulnerable mid-term to the influence of market forces known and unexpected.

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India and the U.S Govt Shutdown: Quick Market Thoughts

by with No Comment AMT MarketsAssetsFeatured Highlights

India and the U.S Govt Shutdown: Quick Market Thoughts

President Trump has been ramping up his claims that India is no longer going to buy Russian oil, he made a statement regarding this belief yesterday once again. As the White House threatened to initiate tougher sanctions against India, there seems to have been some movement towards a reconciliation between the two powerful nations.

The Trump administration is clearly trying to limit the amount of purchases of Russian oil by India to increase economic pressures on Russia, and reportedly India may be starting to actually buy less oil. India has certainly not stopped buying Russian oil in a maximum ‘fait accompli’, but if the nation continues to show a willingness to purchase less energy resources from Russia, this will go a long way in preserving a good U.S and India association. A stronger relationship between the U.S and India can achieve a vital economic and military correlation for the both nations. Improved friendlier tones from New Delhi and Washington D.C appear to have reassured investors in the Indian equity markets via highs currently being seen on Nifty 50, which are now within sight of apex values from late September last year.

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Nifty 50 One Year Chart as of 23rd October 2025

India is a vital and important part of U.S policy as it attempts to also create pressure on China too. By maintaining political and business dealings with India, the U.S can and should look upon this joint relationship as a vast long-term strategic interest. India understands this as well. The ability of India and the U.S to remain ‘friendly’ allies, and the prospect of creating a vigorous economic and military partnership should be one of the U.S government’s essential missions.

India does have strong connections to Russia the past handful of decades politically and economically via its non-aligned status. India will certainly maintain its dialogue and sometimes cooperative dealings with Russia. However, if India and the U.S maintain a solid relationship with the prospect of increasing their economic and political ties this could substantially change dynamics on the Asian continent.

U.S Government Shutdown Since the 1st of October

The U.S government has now been shutdown for over three weeks as Republicans and Democrats remain stubborn about compromise. Both sides have made the shutdown a political game. While each party claims they are doing what is best for the nation and preach to their collective voting bases, the stalemate could start to have uglier effects regarding wages not paid for many U.S employees on the 1st of November.

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Dow Jones 30 One Year Chart as of 23rd October 2025

A lack of government salaries not being dispersed will cause an economic hit via consumer spending and create at a minimum some temporary damage for GDP numbers. Remarkably, and to be clear about this potential impact, Wall Street hasn’t seemed to care yet, but this could start to change. As the U.S economy rumbles powerfully forward without a major downturn in the major equity indices, politicians appear to be comfortable acting like spoiled children on both sides of the aisles engaged in accusing the other side of misdeeds.

Likely to start changing attitudes among Republicans and Democrats in the next two weeks are the coming Federal Reserve’s FOMC Statement during the end of October, and voting results via key political races in the first week of November.

Wall Street wants clarity regarding interest rate outlooks for November, December and early next year. Investors might not get a clear picture from the Fed next week, taking into consideration the Federal Reserve will not have up to date official U.S economic data because of the government shutdown. Meaning the Fed will likely issue a 25 basis point rate cut on the 29th of October and say it is uncertain about the coming few months because it does not have enough inflation, employment and GDP information to form a concrete opinion. The joke of coarse being the Fed seldom seems to have a strong opinion, but now can use the government shutdown as an excuse.

And now for contemplation, let’s look at the election in NYC for Mayor. A bona fide socialist may get elected in New York City who carries the historically misguided and dangerous wisdom of a Marxist. The economic and social practices of Marxism have proven utter failures for over one hundred years consistently. If NYC suffers a victory from the socialist candidate running as a Democrat, Wall Street and many financial institutions based in the city will not react favorably.

In the meantime, U.S equity indices remain elevated, cautious and within sight of record highs. The Nasdaq, Dow Jones and S&P along with other financial assets are producing choppy dangerous conditions for day traders who are attempting to wager on daily changes and suffering from the cautious behavioral sentiment being generated. Investors who look towards the mid and long-term are likely more comfortable, but are certainly keeping an eye on what is going to transpire over the next two weeks. Gold and Silver have come off their speculative highs. Forex continues to create volatile conditions as financial institutions appear unready to make bold predictions about what the Federal Reserve will do into January 2026.
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India Insider: Speculation, IPO Mania, and Capital Erosion

by with No Comment AMT MarketsFeatured HighlightsIndia

India Insider: Speculation, IPO Mania, and Capital Erosion

A speculative frenzy is reflected nowadays via India social media around quarterly results and IPOs. Animated talk about investment potential in India can be compared in some respects to the Dot-com bubble in the U.S which grew in stature into the late 1990’s and peaked in March of 2020 before imploding. Retail speculators in India rush into untested technology stocks hoping for quick profits, often without understanding the businesses. Avoiding a Dot-com like crash is important.

Hedge funds and institutions with their superior supply of capital often speculate across stocks, bonds, Forex and commodities as part of their strategies. However, retail investors should only purchase individual corporate stocks like pieces of businesses which they want to own when they have the ability. Market fluctuations lower can be used to buy quality companies when intrinsic value has been discounted allowing investors with limited funds to take advantage of stock volatility.

Charlie Munger, the right hand man of Warren Buffett, when asked what the secret of running Berkshire Hathaway Inc. was replied, “Warren likes to say, just tell us the bad news, the good news can wait. So people trust us in that (decision making process), and that helps prevent mistakes from escalating into disasters. When you’re not managing for quarterly earnings and you’re managing only for the long pull, you don’t give a damn what the next quarter’s earnings look like.” And this has proven to be advice that all investors can learn from.

Lessons from Yes Bank and Ola Electric:

Many speculative investors rely on technical charts using support and resistance patterns for trading decisions. This frequent buying and selling enriches brokers but rarely investors. Technical trading entices because it often is easier to look at a chart and feel that by glancing at past results you are able to predict the future, but this frequently proves to be incorrect. Fundamentals should always be a large part of investment decisions.

Yes Bank is a classic example. Investors assumed strong fundamentals in 2018, but allegations against founder Rana Kapoor revealed critical issues which proved to be damaging. The Reserve Bank of India stepped into the mess, forcing a consortium of banks to inject equity. Small investors who bought the dips blindly learned the cost of ignoring fundamentals and were hurt financially.
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Yes Bank Share Value from 9th of August 2018 to 9th of August 2019 in India Rupees

Another example unfortunately is Ola Electric Mobility Ltd which highlights a similar trap. Ola’s 2024 IPO raised 75 billion Indian Rupees ($900 million USD) at a value of 76 INR per share. It was hailed as a ‘BYD of India’, and despite high valuation warnings, investors pushed share value towards 160 INR. Predictably as cash burn mounted and with no operating profitability, Ola Electrical Mobility value soon fell below the IPO price and speculators who dreamed big soon began to feel like they had lost. The Yes Bank and Ola Electric Mobility cases demonstrate the dangers of investing outside one’s circle of competence.

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Ola Electric Mobility One Year Chart as of 17th September 2025

Valuations and Investor Behavior:

From October 2022 to October 2024, Indian markets moved significantly higher, stretching valuations beyond earnings. Even after U.S. Liberation Day tariffs triggered a pullback in India, investors continued pouring money into mutual funds through SIPs (Systematic Investment Plans), ignoring glaring fundamental problems. This raises concerns and creates doubts about whether SIP passive investing is wise without understanding individual businesses.

Investment becomes more intelligent when it is done with a business like approach. As Warren Buffett said, “the stock market is a device for transferring money from the impatient to the patient.” But patience should not mean overpaying for growth stories. Predicting future earnings is difficult, and paying lofty prices for stocks in the EV, battery, and micro-processing chip sectors based only on expectations can be dangerous.

When competition or innovation shifts, stock prices collapse as Ola Electric Mobility has shown. True investing is businesslike. It requires understanding, discipline, and buying below intrinsic values. Chasing hype, speculation, and every new IPO can lead to erosion of capital. Smaller investors can do better and they should desire to study fundamentals in order to make good decisions.

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India Insider: Working with the West as it Deals with Others

by with No Comment AMT MarketsFeatured HighlightsIndia

India Insider: Working with the West as it Deals with Others

India’s Prime Minister Narendra Modi visited Tianjin, China for the 2025 Shanghai Cooperation Organization Summit in early September, which was attended by over twenty nations. Before India visited the conference in August, Washington D.C had already imposed a 50% punitive tariff on India’s exports. The initial tariff was a 25% duty, but included another 25% penalty because India purchases a large amount of Russian Oil, which the U.S seeks to reduce. An uneasy trade dilemma looms for India.

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Many Western analysts quickly concluded that Prime Minister Modi was tilting India towards a stronger relationship with the Russian and Chinese camps, by potentially embracing warmer associations with Presidents Vladimir Putin and Xi Jinping, and defying Washington’s previous warnings.

Yet, the trade composition and the underlying reality highlights a different story. Despite India being positioned in the global South politically, the nation recognizes its higher value exports – which include textiles, gems and jewelry, apparel, and pharmaceuticals are primarily sold to the West. The United States clearly remains India’s biggest consumer. In essence President Trump holds a trump card.

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In contrast, China’s total exports to the global South (excluding Western Europe, Australia, New Zealand, and North America) has doubled since 2015. Chinese exports to the U.S were $525 billion USD in 2024, but to the global South, China’s exports grew to nearly $1.3 trillion USD.

As Professor Michael Pettis accurately points out, “countries with expanding trade surpluses with the U.S, use their higher revenues to fund deficits with the rest of the world.”

India Exports More to the West:

India’s trade surplus with United States, the European Union and U.K stands at $72.18 billion USD. If India wants to be competitive with China in terms of manufacturing, it should affiliate more astutely with the Western camp.

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Dependence on Anti-Western Countries Hurts India’s Trade Balance:

India’s combined trade deficit with Russia and China is approximately $158 billion USD, which demonstrates how much less India exports to these two countries. India’s overall merchandise trade deficit is $282 billion USD, with a deficit of almost 56% in total attributed to Russia and China.

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Service Exports a Crucial Metric in India’s Balance of Payments:

India’s services exports stood at $383 billion USD in financial year 2025, earned primarily from the U.S and other Western countries. Washington has imposed tariffs on India’s tradable goods sector, while the nation’s non-tradable sector has been operating without much stress.

India’s overall trade deficit stood at minus $94.26 billion USD in financial year 2025. Without service exports (predominately from the software services sector), India’s current account deficit would be much larger and the Indian Rupee would face greater depreciation pressures.

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India’s economic stability is precarious, equilibrium needs to be found. Solid domestic outcomes for manufacturing and a stable Rupee, including exchange rates, could be achieved with a well-defined calibration that looks West but does not weaken India’s stance as a non-aligned nation. New Delhi should focus on maintaining neutrality and strategic autonomy.

While India may shake hands with Presidents Vladimir Putin and Xi Jinping, an important economic lifeline runs firmly through Washington, Brussels, and London. Crucial negotiations are said to be taking place between Prime Minister Narendra Modi’s team and President Trump’s White House behind closed doors. New Delhi could become vulnerable if it does not find adequate solutions. President Trump has recently reiterated his friendship with the Prime Minister Modi, perhaps an agreement can be produced in the mid-term.

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China’s Economic Future: Speculation & Transparency Question

by with No Comment Economic CalendarEquitiesFeatured Highlights

China's Economic Future: Speculation & Transparency Question

China’s economy has been underperforming for a handful of years. Growth has not only stagnated but has experienced a downturn, deflation has been experienced. Strong leadership from Xi Jinping has led to a firm approach regarding the management of China’s political and economic affairs. Until this year, Xi’s grip on power had grown significantly since he took office as the President and General Secretary of the Chinese Communist Party in 2012, but his control appears to be waning. Yet even as lackluster Chinese economic data has persisted, the Shanghai Composite Index (SSE 000001) has mirrored many global equity indices and done remarkably well since April of this year.

The SSE is near 3,826 currently. In early April the SSE was around 3,080, and in the middle of September 2024 the Shanghai Composite Index was close to 2,700, which was clearly within sight of long-term lows. The current heights of the SSE have not been seen since August of 2015. Yes, the Shanghai Composite Index was over 5,000 in April of 2015 and also in 2007. The point being that highs being traversed have not been seen in a long time. But is the positive speculation in the SSE a sign that economic conditions and political considerations in China are positive? Where is the transparency?

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Shanghai Composite Index Five Year Chart as of 24th August 2025

China’s ability to create significant growth over the past four decades has transformed the nation into a global powerhouse economically and militarily. Yet, the past few years have begun to show cracks in the single handed approach to centralized decision making regarding the economy, government data presented has become suspicious. Rampant speculative forces in the SSE have been seen before. Is now the time to buy more Chinese equities or is it time to become cautious? Reliable statistics remain a troublesome aspect for investors.

China’s real estate market collapsed under the weight of too much building and speculative buying of apartments. Yes, inflated property and sudden deflation has been seen in capitalist countries in the past and will be witnessed again in the future. But the bubble in Chinese real estate and its crash also points out problems regarding a lack of transparency. While the Chinese government has tried to fix the fiscal problems caused by the real estate implosion, it has also created significant fractures within its banking system, which are confronting the Chinese government and public, and sometimes feels like a coverup trying to hide bad news. When will there be a recovery in the China real estate sector, is the worst of the crisis fixed?

Chinese political questions and some evidentiary circumstances point to intriguing considerations. There is evidence in China that a change of leadership is progressing. In the past couple of months small hints have been allowed to be published via China’s state media, the Xinhua News Agency. Rule changes have been made regarding decision making processes in the Chinese Communist Party, this was published by Xinhua in late June and republished by the South China Morning Post of Hong Kong in early July. While paraphrasing, both news entities expressed that rule changes meant Xi Jinping would officially have to delegate more decision making.

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USD/CNY One Year Chart as of 24th August 2025

Speculation is growing beyond a mere whisper that the Chinese military has become a wildcard and a source of power that is potentially ready to help remove Xi Jinping. The military apparently is not supporting Xi and wants a more collective approach to decision making via the Chinese government. Yes admittedly, this information can be described as being from news services and podcasts that do not favor the Chinese government, but they seem to be singing in unison. It appears that China’s People’s Liberation Army have decided it is time for a change and is ready to play a role in the selection of new Chinese leadership.

The 80th Anniversary Victory Day Parade in Beijing will be held on the 3rd of September, what role will Xi Jinping play in the show of military force? Will it become apparent that Xi is merely a figurehead until an official decision is made on how the Chinese Communist Party will be led? Importantly, the 15th Five Year Planning Conclave for the Chinese Communist Party will be held in October and this is where a leadership change could take place including the official removal of Xi Jinping.

There appears to be – yes, via the dissident information heard, two factions within the Chinese Communist Party vying for power – hardliners and reformers. The army still hasn’t made it clear if they are backing the hardliners or the reformers. What is evident however via many publications, is that China’s PLA has decided along with other important leadership circles in China’s Communist Party that Xi had too much control and they want a more collective leadership.

Regarding the Chinese economy which has undergone a period of stagnation and lackluster results the past handful of years under Xi’s strong centralized approach, something big is about to happen which will have ramifications for the next five years. Who will lead China? The hardliners who are true believers in ideological communism or reformers who want China to move towards more of a market economy? This is a huge question. This type of political infighting has been seen in China during the past four decades and played a role in key leadership changes. It is not a conspiracy plot which is being sounded, it is the possibility of a transfer of power which happens cyclically in many nations when changes are warranted.

China’s Shanghai Index has done well recently. Perhaps this is a correlation reflecting optimism being sparked globally in equities in recent months. Or is it also possible that some folks in the know are betting on the reformists to take control of the Chinese government? Tariff concerns have seemingly been brushed to the side in China and something bigger is certainly at play. President Donald Trump is not the story here. Investors participating in China need to pay attention to the political changes that seem to be brewing. While speculation has certainly brought the Shanghai Composite Index to long-term highs, transparency from China is a concern economically and politically and there will be an impact if changes to leadership occur.

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Trading Thud Ending Last Week and Early August Insights

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Trading Thud Ending Last Week and Early August Insights

The EUR/USD is near 1.15650 early this morning. The USD/JPY around 147.850. Forex has provided fast reversals and most major currency pairs are within well established known realms, but caution prevails. Friday’s U.S jobs numbers before going into weekend provided additional mud to filter through for those seeking clear outlooks. Were the employment numbers rigged by the Bureau of Labor Statistics?

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EUR/USD Three Month Chart as of 4th August 2025

Questionable economic statistics have become an open sore spot for some analysts in the U.S, this has been a problem since the financial crisis of 2007/08 and ensuing years when politically expedient numbers were rumored to be in use so the Federal Reserve and U.S Treasury could work in a more comfortable manner. Let’s just say there are actual reasons why and how economic statistics could be used to hurt and help policies. For some evidence take a look at the art of revisions that has been practiced with key economic data the past handful of years. Financial institutions now need to consider the possibility that numbers cannot be trusted, interpret reports, try to decipher reality and consider impact.

Effect on the Federal Reserve is a big question. Fed Chairman Jerome Powell continues to preach uncertainty and say a wait and see approach is needed because of implications regarding tariffs. However, conspiracy theories are also somewhat blown out of the water regarding the recent jobs numbers, because the lackluster results will actually put pressure on the Fed to cut rates in September in order to help spur on a better jobs market. So in other words, financial institutions, big investors and day traders are back to square one.

The ISM Services Purchasing Managers Index stats will be published tomorrow for the U.S, but this report is likely to be a mere ingredient that affects the marketplace. Behavioral sentiment will remain the cornerstone in Forex, equity indices, Treasuries and commodities. August is typically a rather calm month of trading taking into consideration that holidays are being taken by many market participants, but as the S&P 500, Nasdaq 100 and the Dow 30 remain elevated and capable of achieving new record highs, the USD creates chaos regarding outlook influenced by a Federal Reserve that is now in a difficult spot, and tariff implications are contemplated it would be wise to keep an eye on all near-term outcomes.

Technical trading and computer generated algos will factor into conditions as psychological levels are challenged and perceptions are debated. Has the global marketplace grown comfortable to the tactics used by President Trump? While it is easy to say yes, there are still plenty of reasons to remain concerned, this because White House policy seemingly has the ability to shift without notice.

Which has helped produce what may be the golden rule that develops under the current circumstances. Stay alert, stay optimistic but practice caution. Financial institutions have always practiced the art of realpolitik behind closed doors to chase profits, but they must remain vigilant to fast reactions caused from the potential sudden fear of shifting doctrine. President Trump’s rather swirling mix of laissez faire enterprise, and his stark ability to express anger at those who stand in his way or disagree with him do make for a new trading reality. Cautious optimism is likely to rule the world of investment and speculation going forward.

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Unpredictability of President Trump and the Markets

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Unpredictability of President Trump and the Markets

Everyone wants to know what will happen in the future in the financial world. Most everyone also knows that this is impossible. However, clarity about the mid-term is a legitimate focal point that financial institutions strive. Risk managers define their considerations on assorted perspectives depending on their backgrounds.

While some may like him and others clearly are are not fans, President Trump has a reputation for wanting to get things done. His calling card for a long time has been an ability to make business deals. President Trump however has put himself in a rather difficult position and the next two weeks may prove to be an important milestone. One in which those who like the President and those who don’t will be given more credence to debate.

The Federal Reserve will announce their FOMC decision on the 30th of July. Tariff deadlines will supposedly come on the 1st of August. President Trump has made it clear he does not like the lack of aggressiveness which Fed Chairman Jerome Powell is displaying. Trump has called for the Federal Funds Rate to be cut and Powell has not acquiesced.

President Trump has openly spoken about trying to replace the Fed Chairman, but at this juncture the Trump White House knows this will be difficult unless they can prove Jerome Powell has done something maliciously. Not lowering the Federal Funds Rate because of a fear inflation will develop because of potential effects due to tariff fallout is a legitimate reason not to act. Even if the Fed Chairman is wrong, he appears to still be working on a basis which is based on an economic interpretation.

For the next two weeks the broad markets will hear about the Trump and Powell disagreement. It has been argued the Federal Reserve should have lowered the Federal Funds Rate a few months ago, clearly this was not done. However, the USD did trade with weaker sentiment in Forex from early April until the beginning of July. In the past few weeks the USD has garnered some strength, but remains within the lower part of its long-term realms via the U.S Dollar Cash Index. The weakness in the USD was likely due to financial institutions betting on rate cuts to come over the mid and long-term, and which they still believe will happen.

The upwards momentum generated recently by the USD has put the greenback in a position that seems to indicate financial institutions are transacting their cash forward orders cautiously for the moment, while waiting on the next round of impetus. And that is where Federal Reserve clarity and tariff threats now shadow mid-term outlooks.

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U.S Dollar Cash Index Five Year Chart as of 21st July 2025

We have entered an unpredictable window and President Trump apparently doesn’t mind allowing a little danger into the mindsets of the financial markets. It is one thing to proclaim tremendous results and great, magnificent prospects, but how long will investors tolerate a lack of clarity regarding tariff agreements? President Trump has postponed the tariff deadlines several times and what should be considered is the potential that at some point he will have to take action to prove he means business. If the August 1st deadline is extended again this may not cause much of a shock, but it will not be met with optimism.

Instead, the main interpretation from financial institutions may be that Trump is struggling to get agreements done as he had promised. While that might lead to the idea that global commerce will continue on as is, this will certainly not help create the positive impetus which President Trump desired. At some juncture President Trump may begin to be perceived as the little boy that cried wolf. No one will pay attention and the markets will proceed without him. But President Trump will not likely let that happen, he does like attention.

The Nasdaq 100 and the S&P 500 are near record highs, so there isn’t a lot to complain about by index investors. The U.S economy has shown signs of green shoots regarding better retail sales and the recent Philly Fed Manufacturing Index. The grey area for many remains inflation, which has been coming in rather well behaved although the most recent report showed a slightly higher outcome with the yearly CPI reading. However, the Federal Reserve actually has evidence that inflation has been tame. Yes, there are questions regarding the coming influence of tariffs on the U.S economy, but for the moment inflation has not risen.

The lack of clarity and not having a mid-term comfort level which is unperturbed may be problematic for small U.S business owners that face tariff concerns on their imported goods. And the bigger picture remains unclear for large U.S corporations – but they certainly continue to try being optimistic. And this is where it gets more dangerous, plenty of perspectives are being driven (inspired) by analysts who have confirmation bias. For instance the downturn in the USD from April until early July was amplified by many who saw this as a sign the USD was being punished by foreign governments opposed to President Trump. This in fact was highly unlikely, traders need to remain alert to false narratives.

The next two weeks need to be treated carefully. There will be a running monologue among many analysts that changes daily as behavioral sentiment moves depending on what is being spoken about the Federal Reserve and tariffs. However, until there are actual answers the financial markets are likely to remain rather choppy. Self awareness will be crucial for speculators. Also, a large factor in the financial markets will be played by the U.S White House regarding how incoming results are presented. Until then day traders may want to watch technical charts and try to figure out where programmed trading lurks regarding support and resistance levels. Price velocity in Forex, bond yields and gold should be monitored.

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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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Trump: Will He or Won’t He Day and Uncertainty for Investors

by with No Comment AMT MarketsAssetsFeatured Highlights

Trump: Will He or Won't He Day and Uncertainty for Investors

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EURUSD One Month Chart as of 2nd April 2025

Liberation/Tariff Day will blow onto the global financial shores this morning. President Trump and his team are certain to take a victory lap as they announce their decisions regarding actions being imposed on commodities and products. Nations who are on the other end of the drama will be braced for the rhetoric and policies. Investors, trade ministers, financial institutions will have to sift through the pronouncements and consider their outlooks amidst uncertainty.

Trading today will be rough for smaller speculators. Choppy conditions should be expected as behavioral sentiment twists according to shifting winds and interpretations. President Trump is likely to announce aggressive penalties, but he may also try to soothe those who have worried about being punished. As an example, Trump has said recently that India has acted upon many of the White House’s wishes. Mexico, Canada, the European Union and China are likely to be mentioned as the U.S President speaks later today. Will a public scolding take place again?

Equities have faltered the past month, Forex has been volatile and commodity prices have also reflected fragile sentiment as outlooks became grey. The tariff policies announced today will affect all aspects of the financial world. Day traders thinking about wagering on the outcome should be patient and wait for the reactions which unfold from Asia, Europe, Africa, and the Americas. Wall Street will certainly be a barometer, along with the EUR/USD, USD/MXN, USD/JPY, GBP/USD, USD/SGD and gold.

While President Trump declares this is a great and magnificent day for the U.S, it will be of keen interest if an olive branch is offered to trading partners. After talking tough the past few months, financial institutions would like to hear words of optimism from the White House. If belligerence is heard and punitive actions are enacted, which are considered unproductive by investors and financial institutions the broad markets will show their disdain promptly.

President Trump’s skills as a negotiator will be judged today. The White House must play towards its constituency and show they are putting America First, but will the President also display he is cognizant that international trade provides benefits? Trump will point to his claim that he is merely putting tariffs on those who have treated the U.S unjustly and use levies against U.S goods.

It will be an important day for the Trump Presidency, because in many respects the global audience watching will decide whether or not the U.S sees itself as part of the global fabric or seeks a position which is isolationist. Brazil will look on the tariff theater intently, its position as a trading center may find increased demand from a host of nations.

Predicting the results: On the 3rd of February a fast and dangerous Forex market developed which witnessed USD centric strength exhibited with spikes in many currency pairs. In early March reactionary trading was displayed in equity indices, Forex and bonds too. Today will see wide spreads emerge in Forex with near-term resistance and support levels proving vulnerable.

Equities which sold off in March via the Nasdaq 100, S&P 500, Dow 30 and the Russell index are certainly hoping for a dose of cheer. The question is if Trump will deliver a positive message. The likelihood is that today’s events will not be the last of the tariff tirades and some proposed actions remain under deliberation. Today is unlikely to produce final results and the broad markets are probably going to be choppy as outlooks stay mitigated and absent of clear resolutions.

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Gold Three Month Chart as of 4th April 2025

Day traders should think safety first today. Gold remains within record territory. If unpredictability rules near-term and the reactions of investors and financial institutions create fast conditions, the precious metal and bonds will find takers. Uncertainty breeds cravings for risk adverse assets.

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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?

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FX Trends: Brutal Months for Day Traders and Happy Brokers

by with No Comment AMT MarketsAssetsFeatured Highlights

FX Trends: Brutal Months for Day Traders and Happy Brokers

The past few months for day traders have likely not been pleasant experiences for many. Forex, equity indices and other assets have experienced plenty of volatility and finding a trend has not been easy. While speculators who are wagering on the ups and downs in the marketplace have been getting crushed, their brokers likely have not been getting hurt.

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USD Cash Index Six Month Chart as of 7th of March 2025

Day traders need to understand that CFDs are virtual. Your broker is merely placing a wager for you on chosen direction, in most cases they are acting as ‘the house’ and know the volatility is going to knock you out of your trade. They pocket your losses as their winnings in many cases. The brokers are not only making money from the differentials from the bids and asks (the spread), they might also be charging you a transaction fee.

If a broker feels less confident about their ability to make a profit off your poor results (I am not kidding about this), then they sometimes insure your wager via a liquidity provider who in many cases is literally betting against your broker, because the liquidity providers believe your broker is likely being overly cautious. (A vicious circle). In other words brokers allow your trades to work virtually (not in the real marketplace) on something many risk management rooms in Forex call the B Book. If the broker is not certain if you will lose money, they put your trades into something called an A Book. And, yes, many liquidity providers (the A Book providers) are betting against their clients (who are brokers seeking to mitigate their risks).

Again, the brokers and the liquidity providers do not believe you will make money most of the time. They are allowing you to bet and they are happy to take your wager, because historical evidence shows retail bettors in Forex tend to lose money via their trading accounts at least 85% over long durations. Depending on what source you look at regarding CFD statistics, speculators tend to do a little better against their brokers but still lose money more than 50% of the time. Some statistics claim up to 75% of the CFD outcomes via trading accounts equate into losses for speculators.

And if all of this sounds like sour grapes, it is not, it is a warning to you the bettor. Brokers in many cases are glorified casinos that provide you an opportunity to wager. You need to acknowledge the above before your start trading. Speculating on Forex and CFDs ( via equities, indices and commodities) is like betting on a horse. The racetrack doesn’t lose money, they know most bettors simply enjoy the thrill of gambling and don’t mind losing. Racetracks are happy to pay the occasional winner. If you choose to wager on Forex and CFDs you need to practice risk management.

You probably didn’t come here to be reminded about risk management, you have heard it before – conservative leverage, price targets, timeframe parameters, entry – stop loss – take profit orders are standard warnings. You want to read about trends, you want to know which direction you should take, yet there are no guarantees and that is why speculating is gambling. You are wagering.

If you intend on improving your odds, by following solid risk taking tactics – including trying to understand behavioral sentiment via the financial institutions you are trying to emulate, you might find better results. And still, speculating will be tough.

The U.S will release Non-Farm Employment Change numbers today, but traders should pay attention to the Average Hourly Earnings report which will give insights about inflation too. However, the jobs numbers may prove to be a false narrative, because more importantly, whether you like him or not, there is the Trump Effect to ponder.

Tariff mantras and fears, negotiations regarding the fate of Ukraine, and a myriad of other concerns have financial institutions anxious as they try to seek clarity. Equity indices have been a mess. Yet, the USD Cash Index has given back a lot of its gains since February the 4th – this after the Forex bloodshed caused by nervous reactions to fear of tariffs being implemented. And now, not so coincidently the USD Cash Index is traversing values it saw on the 5th of November 2024, yes, U.S Election Day. Speculators and financial institutions have returned full circle to big unknowns.

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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.