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USDCHF SELL TARGET 0.95700Good evening from the UK. As there is alot of economic volatility it is good to know a few good tips about the markets and how investors react. Currencies can become very volatile is there is a threat on specific economies. the dxy can be impacted negatively due to the iran gestures and drama.This could see investors pull investments out of US assets/stocks/currency and place their capital into assets of solidarity. These could be aspects such as commodities like Gold & Oil where prices could rally to the upside against the dollar or short the dollar against certain currencies. In this case this is what I have as a bias today. We have had 5 bearish weeks for the US Dollar. Investors see the Swiss franc as a safe bet as the thrive of the Switzerland's fantastic economical infrastructure and stability. With threats on the USA looming we could see a continuation of this. Linking it to the Daily technical timeframe, I see price rides underneath the EMA and a slight pullback/retracement the end of last week possibly ready for more sell positions from investors. We will need to see how price opens after the weekend to determine this but a break below the monthly support could be possible. This is a strong support level so a double bottom could form. Price has not closed below 0.96600 since September 18, could the time be now? A great pair to keep an eye on.
Short
by Travis_duncz
USDJPY trade planAfter unprecedented attack from USA sanctioned by Trump the week turned into quite roller coaster. War threats with Iran have created a fearful first week in the market as safe havens surged with gold and silver gaining around 2.4% and 2.7% respectively since the start of 2020 as investors are trying to protect their capital from exposure in risky markets. JPY of course was a massive gainer, USDJPY fell through the channelled resistance and now found key support level just below 108. This weekend we are waiting for the new development between US and Iran to understand the next direction of this pair. A fall through support would indicate continuation of a short trade. Looking at 1 hour time frame in comments section a down trend line and small resistance zone show potential level for reversal and a buying opportunity. This trade will be largely determined by fundamental news from Iran and White House and I will update whenever news come out. Good Luck!
by Antonio_trader
ORBEX: US Air Strike Sends Oil and Gold UP!A US airstrike at the Bagdad airport killed Iranian General Qassem Soleimani’s. Not only this is going to increase geopolitical instability in the region but it also questions the legality of the President's decision as he acted without Congressional approval! US-Iran relations are taking a sour turn early in the year following an “extremely dangerous” attack that could set off a war. See how oil and gold have been affected so far and how they are likely to perform in the short-term. Timestamps WTI 3H 01:50 GOLD 3H 04:15 Trade safe Stavros Tousios Head of Investment Research Orbex This analysis is provided as general market commentary and does not constitute investment advice
FX_IDC:XAUUSD
by Orbex
ridethepig | DXY Market Commentary 2019.12.18A timely update to the Dollar chart in time for the NY session, with most of G10 FX trading at the bottom of the short term range markets are preparing for the final flush in USD before killing the year off on the FX board. Lets start by reviewing our long-term map: Here we are tracking the Monthly chart in Dollar from an Elliot Wave perspective; after 15 years of the previous bullish USD cycle we are reaching the end of the road. For those tracking the USD devaluation you will know we are trading the final leg in the 5 wave sequence: On the technical chart the channel support is holding on by a thread: Best of luck all those looking for cheaper entry levels in the Dollar short leg, uncertainty around US growth is not going away. Even if the impeachment expectations fall we should see USD coming under significant pressure. Thanks for keeping the support coming with likes, comments, questions and etc! And as usual jump into the conversations in the comments with your views.
TVC:DXYShort
by ridethepig
The truth Your I.B. doesn't care about you.. (exposing C.O.I.)The times have changed for the retail trader, and in essence scalping and day, trading has, in essence, become a complete waste of time for the average person looking to make even a small gain in the FX market. In the last 6 years, day trading and scalping have become worthless strategies, only done by those who are ignorant to the situation behind the scenes that makes of a huge negative feedback loop full of conflicts of interest with one goal; to take the retail trades money. As swing traders, we are the only type of trader that is left. We let the market tell us what to do, not the other way around. It is obvious that a market that is stuck in a range, is impossible to trade for a profit. The biggest mistake one can make, is only trading one asset class, and only 1 timeframe. This is the most obvious mistake that most new traders make. Learning to trade the timeframes that are significant to volatility in the market and by diversifying to multiple asset classes. Volatility is a traders lifeblood of a trader. Since 09', volatility has been absolutely crushed. Without volatility , there is no risk and opportunity (sides of the same coin). This means returns peter to 0. The question is, why has volatility been crushed? There are a few reasons: quantitative easing, the advancement of algos, and expanded participation. The monetary policy introduced by the FED after the 08' recession was quantitative easing QE ). Essentially, QE means that central banks increase the supply of money by buying government bonds and other securities. What does this mean? It means a guaranteed buyer of bonds, which suppresses yields permanently, feeding over into other asset classes since the market begins to look for other opportunities (chasing yields) which ironically only suppresses yields further. Technology: Volatility has been suppressed by the advancement of algos and automated trading stations. An increase in algos over the last 8 years has dramatically increased the number of market participants. How does this affect volatility? It's simple: more willing buyers and sellers mean that the equilibrium in price is considerably more stable, thus decreasing the natural fluctuation in the price of an asset at every single price. Dec 08 Comment: Now how exactly is the market rigged against the retail trades? I'll explain every dynamic. I'm going to assume you understand what a CFD is and how a margin call is determined through an over-leveraged exposure to the market with your accounts equity (google these if you are new). Now how exactly is the market rigged against the retail trades? I'll explain every dynamic. I'm going to assume you understand what a CFD is and how a margin call is determined through an over-leveraged exposure to the market with your accounts equity (google these if you are new). Let's think about the problem that an international broker has as a business. Keep in mind, over 90% of their clients losing all of their deposited funds within 3-4 months, how does this business even grow? If you own the brokerage company, you have to spend a significant amount of money (between 30-50%), towards customer acquisition. This is the only way you can stay at the same level. Now, this is where conflicts of interest begin. What do you think happens when a broker has access (backend) to 90% of let's say 10,000 traders who always are losing money? You take the opposite side of their trade. Why? You would have a 90% win ratio. With an average balance of a few thousand dollars, most retail traders tend to blow up in just a few days when trading over 100x. The way that the brokerage industry works, is that it is built around major conflicts of interest. This creates a scenario because all players are aware and build the infrastructure for their benefit not yours. A retail trader has one simple objective, to make money through profitable trades in the market. Wallstreet's intentions are to take retail traders money. There are 4 main conflicts of interest I will discuss. Spread. What is spread? The spread comes from the guaranteed purchase or repurchase (short) of an asset, through a profit in the difference of market value and the price. The cost of guaranteed liquidity is through the broker being offered a price that they can make a profit on. If a broker has two clients, the client a is relieved of their position at $1, and client b is then sold that position at $2, making a profit of 1$ by providing the liquidity. This is called "taking a turn". Commission: A percentage of a trades price to enter in and out. The two most obvious conflicts of interest here is that the amount of volume is dependent on the amount of profit for the brokerage. Brokers want the retail trader to trade in the biggest position possible as much as possible. Now the answer to the question as to why a brokerage would lend you 100x to trade with becomes obvious; they get paid. The next two are not so obvious. Over the counter contracts are unregulated. When a losing contract is provided liquidity from the broker to a losing retail trader, taking the other-side of this contract is called "OTC Gain". "Financing Turn" is the money made from the percent difference between borrowing from creditors (banks, investors) to finance leveraged grading and the percent charged to clients. IN essence, this is the ability to charge 100X of commission for an account with X dollars. Who finances a brokers ability to lend money, comes from an investment bank. Through collateralized debt, a revolving credit facility can be formed and thus farmed for credit from retail traders. The only reason this makes sense is through the deposited funds from retail traders themselves. These funds are again collateralized and used by the investment bank. IN essence, retail trades deposit money, which sponsors the broker to be lent money by their investment bank at a % higher. Retail traders essentially finance their own financial demise. With over 90% of traders losing money, a brokerage is incentivized to borrow as much money as possible to profit from the financing turn of their clients. This is where the introducing broker (IB) comes into play. A brokerages revenues come from the addition of spread, commission, financing turn, and the OTC gain. Retail brokers are incentives to create a narrative that increases you changes of losing money. They are heavily invested to make retail traders believe in scalping and high volume trading strategies, so that you can get rich quick. Let's break down the chart. -Investment Bank: Provides credit and clearing to the brokers. Order-flow is created here. -Broker: Providing access to platform and software, access to credit, and fulfilling liquidity (that you wouldn't get as a retail trader anywhere else). This means that a retail traders has to use a broker; necessary evil . -Educator (introducing broker): Educators are paid by a broker commission on every trade you take. They will glamorize the lifestyle of quick and easy money, becoming a millionaire from a $600 account. Providing a simple strategy using 4 indicators, with a simple buy and sell execution plan around it. -Retail Trader: Dumb money. They believe everything that their educator and broker tell them. They pay spread and commission, and provide the demand for financing/leverage, losing trades, and for a false narrative. -Smart Money: Believe none of the participants in the entire market who have conflict of interest. Who are the biggest clients of exchanges? Investment banks. Smart Money (professional traders) -understand how the market works -understand that conflicts of interest exists -avoid trading in the way that anyone with conflicts of interest want them to trade do everything in the opposite way to the how retail traders do things. Dumb Money (retail traders) -believe everything they are told and rely on the infrastructure provided to them by market participants with conflicts of interest. -believe the infrastructure has been built and designed to benefit THEM. -they do everything in the opposite way to professional traders. Smart money requires dumb money to exist. Smart money predicts the future (whisper numbers). Dumb money reactions to the present and wealth is thus transferred. The biggest payers of feeds to exchanges are investment banks, hedge funds and pension funds.
SP:SPXEducation
by TayFx
23
Thin market and statistical arbitrage in safe-haven assetsThe period of the Christmas holidays is traditionally characterized by low liquidity in the financial markets (so-called “thin market”). So you can increase the level of aggressiveness in trading to the maximum due to the relatively insignificant volatility. But at the same time, the probability of flash crashes and sharp inexplicable jumps in volatility during such periods is maximum. We have not noticed any flash crashes on this Christmas, however, strange movements were present. Dynamics of safe-haven assets during Christmas week, for example. Gold has been growing steadily that day and consolidated above 1510. At the same time, the Japanese yen is under pressure and buyers tried to break through the resistance level at 109.60. Well, yen rate dynamics could be explained by Trump’s announcement that an official ceremony of signing an interim trade agreement between the United States and China will be held soon. But the growth of gold, in this case, is illogical. Who is right in the end: gold or the yen - we will see. And we have a trading idea about this. This is the so-called statistical arbitrage. The correlation level between gold and the Japanese yen in 2019 was quite high. That is, statistically, they should change synchronously. Now there is a desynchronization (divergence). It can be eliminated either if gold drops sharply, and the yen remains unchanged, or the yen rises sharply with gold remains at the same level. Both of these options guarantee earnings if you simultaneously sell gold and buy the Japanese yen. And finally, another excellent trading opportunity - sale of the Russian ruble. For those who are already in the pair's purchases, we would recommend adding twice the volume.
Long
by Trade24Fx
Why Governments and Banks will be KILLING their currencies!Before I begin my discussion on Inflation and Deflation, I want to preface by saying I still expect the US Dollar will be going higher, and this will exacerbate the world's problems. This is linked below. Of all the questions I receive regarding economics and monetary policy, the question on what is inflation and deflation, and why it is important, is at the top of the list. This blog post will dissect what inflation and deflation really are, and why governments and central banks love inflation…while hate deflation (albeit discreetly perhaps). Remember, now a days, inflation and deflation have a lot to do with the funny money policies of the mercantile/keynesian school of economics…which are socialist in nature as they encourage big government and government playing a large role in the economy, to a point where they manage it and we get no true free markets. So, the common definition of what people are taught about inflation and deflation are: Inflation is when cost of living and prices of things go up. Deflation is when cost of living and prices of things go down. What are inflation and deflation really? Inflation is when the currency of a nation weakens, that it now takes more of the weakened currency to buy something. Deflation is when the currency of a nation strengthens, that it now takes less of the stronger currency to buy something. This is actually pivotal right now for the US-China trade war. According to Keynesian economics, a weaker currency is great for exports, while a stronger currency is bad for exports, since nations will look to buy from the cheaper nation. China likes a weaker currency, which they actively manage, as a way to boost their exports. What they really are doing though is they are importing inflation, making it look like their economy is growing, while exporting deflation, making the other nation, in this case America, appear as if their economy is not growing. This is why China is labelled a currency manipulator as the Chinese want to keep the currency weak compared to the US Dollar. To be honest, every nation does this although they do not say they actively intervene with their currency like the Chinese. So why inflation? Why do central banks (western) want to target 2% inflation a year? Why do they want to raise living costs by 2% a year? First and foremost: Inflation is Taxation. The more expensive things get, the more tax revenue can be collected by way of sales tax and property tax etc. Something your politician that says they want to lower costs will not tell you…especially when government is large and bloated and has many social programs to pay for which requires tax revenue. Inflation is also largely psychological in nature. It can get to an extreme point where people lose confidence in the government, banks and fiat money where we get hyperinflation as people distrust the further and extreme devaluation of the currency they are supposed to use. When a central bank sets up an inflation target, they expect that people will say “oh man, I need to spend money now otherwise things will get more expensive next year and going forwards”. This is a way to encourage people to spend money and boost the economy. It gives the impression the economy is improving so people and business’ will spend money. Interestingly enough, at the most recent Fed meeting, Fed chair Jerome Powell talked about aiming for 3% inflation targets…attempting to spur people and business to spend money. Inflation is great for business’ (and government) because they can borrow money to invest and payback with cheaper dollars. Let’s say rates to borrow are at 3%, and inflation is at 2%. In real terms, rates are 1%. Going forward, you will be able to payback your debts with cheaper dollars. Western governments have a lot of debt. They want to use inflation to handle their debt loads. This is part of the reason why western central banks are cutting interest rates. To weaken their currency (inflation) so people and government can payback their interest payments with cheaper dollars, and service their debt. You can read my reasons on why central banks are cutting rates here. This of course really has not have the effect it was supposed to have. A lot of people and business’ know the real economy is not improving. It really has all been financial engineering. It is a better bang for your buck as business to borrow money for share buybacks than investing it into the real economy by building factories and hiring new workers. All funny money. So deflation. Why, might you ask, do government and central banks not want to make living costs and costs of things cheaper? Very simply: Because government has not found a way to tax lower living costs….although the socialists are saying this can be done with the green taxes: tax for breathing, km driven, empty rooms, and quite frankly, a tax for just being human. Psychologically, deflation makes it appear the economy is worsening. It can be a self fulfilling prophecy. If people know things will be getting cheaper going forward, they will wait for things to get cheaper before they purchase it, especially assets and real estate. People do not spend money, business lose money and cannot make profits, and you get a recession. We have seen this recently in Japan and Europe. Where they have had constant deflation, where in Japan, many have become renters because they get no equity in their home, and the home loses value or stays the same year by year. To get some sort of inflation, they have resorted to negative interest rates, forcing people to pay the banks if they save money rather than spend. They thought people would spend since they are losing money in real terms. The central banks cannot admit their funny money policies have failed, they say they have not cut deep into the negative enough, nor did they devalue the currency enough. Digital money will be coming as it will force you to keep money in the banks and pay them monthly for doing so. One can say that the people of Japan and Europe have lost faith in the central banks and their funny money policy. Once again, this is all to do with the mercantile/keynesian soft money regime of economics. With soft money, government and banks can devalue currency for policy purposes while it generally hurts the citizen in the end. We are at a period where central banks have run out of tools…besides lowering rates further negative and adopting digital money. When central banks received this power to devalue post 1971, central banks became powerful, and the press conferences have turned into the media circus’ they have evolved into today. They are rock stars and have immense influence. Just want to end with a quick thing regarding Paul Volcker who was Fed chair between 1979-1987 and passed away at the age of 92 a few weeks ago. Before central bankers became rock stars, and we did not have funny money. Mr. Volcker had to rent an apartment in Washington when he took the Federal Reserve Chairman job…his previous job as New York Fed Chair paid more than the post in Washington. His wife had to go back to work in order to live comfortably. A true civil servant. When money and producing money becomes easy, you get people flocking to finance and banking. Banking then becomes the largest part of economies. Pre-1971 and in a hard money system, most bankers and traders needed multiple jobs to support themselves.
COINBASE:BTCUSD
by Uncharted-FX
3
Christmas Trading, Fed & Aussie BreakthroughThe pound had dropped below 1.30 earlier in the week. AUDUSD gained a foothold above the resistance level of 0.6900. If this breakdown turns out to be stable, then a wide space opens up for the AUDUSD for further growth to at least 0.7020 or even 0.7200. Since AUDUSD is above 0.6900, its purchases seem to us profitable. But in any case, remember the Australian dollar refers to commodity currencies, which means it is extremely sensitive to news from the fields of trade wars. Further de-escalation of the conflict will contribute to the implementation of the scenario described above. But the slightest fears about the negotiations between the USA and China can negate yesterday’s breakdown. In addition to the Australian dollar, what is happening on the foreign exchange market is worth noting except the inability of the pound to go below 1.2920, which can be taken as a signal that a panic wave has subsided. In this case, upon the return of the GBPUSD above 1.30, we recommend its purchases. Today we’ll talk about the monetary policy of the Fed and a rake the Fed stepped on. The Trump invades not only the politics and economy of the United States but also intervenes in the activities of an independent body, the Central Bank. Yes, the direct threats and calls of Trump are ignored by the Fed, but there are indirect points (for example, the consequences of trade wars) that the Central Bank cannot ignore. So the Fed’s attempt to normalize monetary policy and smoothly blow out the price bubbles that have formed in the stock market, corporate lending market and the debt market, faced with the consequences of the trade wars unleashed by Trump. And in 2019, instead of the planned increase in the rate by 0.50% -0.75%, the Fed cuts the rate three times. Thus, provoking further inflation of bubbles. So, the consequences will be more disastrous. The World Bank predicts China the role of the epicentre of a new global crisis. So we may well face a new Asian crisis, but unlike 1998, the matter will not be limited to a slight fright and default of a single Russia.
by Trade24Fx
2
Worst week. Christmas. What to expect?The pound experienced one of the worst week these years. Johnson and the deadlines greatly spoiled the mood for buyers of the British currency. The ghost of an exit without a deal materialized again. However, its probability is no more than 25% (according to Goldman Sachs analysts), many hastened to take profits from the sharp growth of the pound in the parliamentary elections after net sellers joined them. Also, weak data from the UK was published, as well as a “dovish” tone of comments from the Bank of England. As a result, all this led to the 1.30 test. No matter how bad was the last week, we see no reasons to panic. On the contrary, the pound is perfectly substituted and this should be used. Johnson's words in no way (in our understanding) cancel the general line, which is the "soft" exit of Great Britain from the EU. On Friday, the new Parliament of Great Britain has already voted for the version of the agreement developed by Johnson. That is, from the point of view of facts, everything speaks in favour of an exit from the transaction. Exit with the deal is the price of the pound against the dollar 1.40 and higher. Besides, Friday's UK GDP data came out better than expected. So feel free to buy the pound in the medium term and on the intraday basis. Highlights and takeaways from the historic week that Trump was impeached. We do believe that Trump will “sit in his chair” until the end of his term, but the future fate of the presidency is a question. In general, the Democrats held an excellent rally of black PR. Their coming to power can greatly change not only political but also the economic reality in the United States. But this perspective is still quite far. We are waiting for Christmas week. Accordingly, an extremely thin market with an increased risk of volatility explosions or even flash crashes. Our trading plan for this week is extremely aggressive intraday trading based on oscillator signals. We do not expect any strong directional movements and look forward to fluctuations in relatively narrow ranges. Making trading almost risk-free. In our case (thin market), we ensure each position with relatively small stops. As for the medium-term positions: we buy the pound, the Japanese yen and gold, we sell the Russian ruble.
Long
by Trade24Fx
Pound under pressure, GDP & dollar There was a lot of talks about Trump Impeachment. Despite the decision of the House of Representatives, the chances of gaining Senate support are extremely low (gaining 2/3 of the vote is almost impossible). So the reluctance of the dollar to fall against this formally negative fundamental background is generally understandable. And if the dollar yesterday felt relatively confident in the foreign exchange market, the British pound continued to be under pressure. The day for the GBP began with failure: retail sales (MoM) November f -0.6%, however, the experts expected an increase + 0.2% (MoM). As a result, this decline formed the longest series of monthly retail sales in the country since 1996. A series of the fundamental negative for the pound continued the Bank of England. The central bank did not lower the rate but made it clear that considering such an option. Lowering the forecast by the Central Bank on UK GDP growth rates in 2020 by 0.1%is not optimism news for pound buyers. So the results of the meeting of the Bank of England are “dovish”, which was against the British currency. The fate is not in the hands of the Bank of England or macroeconomic indicators but in the hands of Brexit. Despite Johnson’s statements on Monday, we continue to believe in the deal and the “soft” Brexit, which means that the pound will certainly grow, with growth rates up to 1000 pips. Accordingly, the lower the pound falls, the greater the growth. Therefore, we continue medium-term purchases of the pound, and today we buy on intraday from 1.30 (the entry point is too good to pass by, plus the Friday before the Christmas holidays - many want to take profits in short pound positions, which will contribute to its growth) Today is unlikely to be calm. Besides the fact that it is necessary to process and take into account the prices the entire array of information that is hitting the financial markets this week, on Friday we are waiting for data on the GDP of the UK and the USA to come out, as well as statistics on retail sales in Canada. We do not expect any excessively strong directional movements, so we will adhere to the tactics of oscillatory trading on the intraday basis As for medium-term positions, there are no changes: we buy the pound, the Japanese yen and gold, we sell the Russian ruble.
Long
by Trade24Fx
Impeachment Trump - a time bomb for the US stock marketIn our previous reviews, we have repeatedly spoken about the bubble that swelled in the US stock market and that the sale of shares of American companies or the stock market as a whole is a unique trading opportunity that happens 1-2 times in trading life. Accordingly, to miss such an opportunity is simply a crime against trading. There are more and more signs of impending collapse (see our previous reviews). The stock market has not fallen yet, because the Fed is taking completely desperate steps to keep it afloat (referring to the sharp inflation of the Fed's balance sheet due to operations in the repo market of up to $ 500 billion this is an injection of money into the US financial market). The scale of cash injections is horrifying - the Fed is serious about increasing its balance by 10% soon. This cannot go on for long. We will talk about the consequences of such a policy in our next review. Today we will focus on the main event of the current week, the consequences of which can affect for years. We are talking about the impeachment of Trump and a successful vote on this issue in the US House of Representatives. We want to note that there will be no immediate effect since this whole procedure does not aim to remove Trump from the post of President, but rather is an act to discredit Trump and the Republicans as a whole. The majority in the Senate are Republicans. Not a single Republican voted for, the Senate will fail to vote. That is, in terms of the current Presidency, Trump is not in danger. But the damage to his image and the image of the Republican Party, which he represents, will be colossal. That is, the chances of the Democrats winning the US Presidential election are sharply increasing. For the US stock market, this could be the verdict and the end of the bull market era. Recall, the US stock market owes much to its growth to Trump and his policy, starting from lowering corporate income tax (from 34% to 21%, which led to a sharp increase in company buyback programs and provoked an increase in demand in the US stock market) ending with upholding the interests of US producers (trade wars were unleashed for this purpose). And in general, the Republican agenda is to protect big business, which plays into the hands of the stock market. The advent of the Democrats means a sharp turn in public policy, which will lead to the disappearance of favourable conditions for the US stock market. Against the backdrop of an overbought market, this will be enough for a reversing and the start of sales. Thus, the impeachment of Trump is a kind of time bomb laid under the US stock market. According to Stanley Druckenmiller, one of the most successful American investors, “a change of leadership in the White House will mean the advent of anti-capitalists. Which will trigger the transition of the US stock market to the bearish phase. ” Recall that we consider 2019 the last year of unjustified growth in the US stock market. Already in 2020, it will begin to adjust. The scope of the correction ( rather the bearish phase of the market) is from 50% and above. Given that in recent years, shares of technology companies in the US stock market have grown by an average of 7-8 times (and some issuers have shown growth of 10 or even 20 times), the US stock market will become the object of massive sales. We recommend participating in this process, selling both the market as a whole (Nasdaq index) and the shares of individual issuers (Apple, Microsoft, Alphabet, Oracle, etc.).
TVC:NDQShort
by Trade24Fx
4