Hello traders.
This is my first trade since last week.
Trump is ripping through the markets like a tornado.
First, the made for TV moment of dressing down Zelensky in the White House. We all know, the meeting just prior to that behind closed doors must have been a screaming match because he did not get his way. I'm surprised he did not yell at Zelensky, "You're Fired"! :))
The UK, France and other European leaders picked up the baton in this frightening battle of egos to prevent World War 3. The Euro responded as expected but retreated from the familiar 1.05 level.
Today, new tariffs are announced-again. The stock market responded with all three major indices shedding significant value.
Tomorrow night, Trump's address to Congress. What is going to transpire in that speech is well known ahead of time: inflation, immigration, America First, tariffs, that ungrateful Zelensky blah blah blah
However, it is the unknown that he may come up with that gave me pause to reassess risk appetite. I am not opposed to the USA demanding fair trade but why bother with the pretense of trade agreements?
Folks, it is not looking great. He took crypto on a wild ride with his "reserve" announcement. Bitcoin ripped higher from $78K to 94 and back to 82 in no time.
Gold is turning up.
The VIX was up to 24 today from a sedate average of 14 since the FOMC December 2024 rate announcement when it spiked up to 29.
I was still considering trading my favorite instrument EUR/USD(be careful) until I searched for an answer as to how legal the tariffs are under the USMCA (Old NAFTA) trade agreement and found this article.
cepr.org/voxeu/columns/chaos-theory-assessing-legal-validity-trumps-tariffs
I encourage you to read the whole article. The take away for me is that the use of the 1977 USA International Emergency Economic Powers Act (IEEPA) as a pretext(think fentanyl) to raise tariffs on Mexico and Canada, is not only diabolically devious(good job Peter Navarro), there is not much point for any organization or individual in the US to challenge it in court.
China has already filed a complaint with the World Trade Organization during February although the foregone conclusion is that even if they prevail, the US will appeal and a whole lot of nothing will happen.
There is the ongoing opinion that Trump is using all these tariffs as bargaining tools but when one considers his outburst with Zelensky, supporting Putin in public, risking WWIII and then apply that reckless mindset to trade, I am truly terrified of the global economic pain that may follow.
I have shorted the CHF/JPY since these are the safest global currencies.
The fundamentals are simple. The SNB cut rates by 50 bps in December 2024, will meet on March 19th but will probably stay put.
The BOJ is on a different path. They are raising rates. So while both currencies are at 0.50%, the JPY seems to be the clear winner, also because of the size of it's economy and no clear threats of more tariffs-yet.
The pair is below the 100 W MA and has a long way to trend down. This could be a great set and forget trade.
This is risk off environment and I wish everyone the best.
This is my first trade since last week.
Trump is ripping through the markets like a tornado.
First, the made for TV moment of dressing down Zelensky in the White House. We all know, the meeting just prior to that behind closed doors must have been a screaming match because he did not get his way. I'm surprised he did not yell at Zelensky, "You're Fired"! :))
The UK, France and other European leaders picked up the baton in this frightening battle of egos to prevent World War 3. The Euro responded as expected but retreated from the familiar 1.05 level.
Today, new tariffs are announced-again. The stock market responded with all three major indices shedding significant value.
Tomorrow night, Trump's address to Congress. What is going to transpire in that speech is well known ahead of time: inflation, immigration, America First, tariffs, that ungrateful Zelensky blah blah blah
However, it is the unknown that he may come up with that gave me pause to reassess risk appetite. I am not opposed to the USA demanding fair trade but why bother with the pretense of trade agreements?
Folks, it is not looking great. He took crypto on a wild ride with his "reserve" announcement. Bitcoin ripped higher from $78K to 94 and back to 82 in no time.
Gold is turning up.
The VIX was up to 24 today from a sedate average of 14 since the FOMC December 2024 rate announcement when it spiked up to 29.
I was still considering trading my favorite instrument EUR/USD(be careful) until I searched for an answer as to how legal the tariffs are under the USMCA (Old NAFTA) trade agreement and found this article.
cepr.org/voxeu/columns/chaos-theory-assessing-legal-validity-trumps-tariffs
I encourage you to read the whole article. The take away for me is that the use of the 1977 USA International Emergency Economic Powers Act (IEEPA) as a pretext(think fentanyl) to raise tariffs on Mexico and Canada, is not only diabolically devious(good job Peter Navarro), there is not much point for any organization or individual in the US to challenge it in court.
China has already filed a complaint with the World Trade Organization during February although the foregone conclusion is that even if they prevail, the US will appeal and a whole lot of nothing will happen.
There is the ongoing opinion that Trump is using all these tariffs as bargaining tools but when one considers his outburst with Zelensky, supporting Putin in public, risking WWIII and then apply that reckless mindset to trade, I am truly terrified of the global economic pain that may follow.
I have shorted the CHF/JPY since these are the safest global currencies.
The fundamentals are simple. The SNB cut rates by 50 bps in December 2024, will meet on March 19th but will probably stay put.
The BOJ is on a different path. They are raising rates. So while both currencies are at 0.50%, the JPY seems to be the clear winner, also because of the size of it's economy and no clear threats of more tariffs-yet.
The pair is below the 100 W MA and has a long way to trend down. This could be a great set and forget trade.
This is risk off environment and I wish everyone the best.
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The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.