Make no mistake – we are living through a period of profound transformation. Whether our economies continue to grow or experience a major downturn is only part of the broader narrative.
The divide between Europe and America is widening. While this may not result in a complete economic divorce, it is undoubtedly creating challenges for both investors and taxpayers alike.
As someone who tends to favour short positions over long ones, I am genuinely surprised by the resilience of the euro and the pound, as well as the sustained strength of the FTSE. Admittedly, this has caught me somewhat off guard in recent weeks.
Back in February, I took short positions in both the DJIA and FTSE. While I was able to exit my DJIA position at my initial target, the FTSE held its ground longer than expected, forcing me to extend my trade. As the market eventually moved in my favour, I decided to lower my stop to 8,650 to lock in profits. Unfortunately, this level was triggered on Monday, leaving me with just over 100 points in gains – half of what I could have secured had I exited a few days earlier. Still, a profit is a profit.
Currently, I hold a modest short position in EUR/USD around 1.08, which is not ideal. I have also added a short position in GBP/USD at 1.30 and recently included some Ethereum in my portfolio at just under $2,000 – trades I have been considering and discussing over recent weeks.
The Big Decision: What to Do with My Gold
One of the biggest questions I face now concerns the gold I buried in my garden years ago.
Gold has appreciated by about 60% since my purchase, and while I am in no rush to sell the physical asset, we have reached a level where resistance could emerge, potentially triggering a correction. Given the current strength and heightened volatility, I am considering selling some short-term out-of-the-money calls to capitalize on the situation.
Two-month 3,350 calls are trading above $10 – not a huge amount, but given my initial buy price, having to unload at 3350, plus the premium would still yield an excellent return. If they expire worthless, I will have pocketed the premium, which is a win-win scenario.
(This might prove especially useful, given that my insurance company has yet to determine how much of my fire damage they will cover – I may need more cash than anticipated.)
I am not bearish on gold, particularly with the EU still actively exploring Central Bank Digital Currencies (CBDCs). I am, however, a reluctant seller. But the speculator in me sees this as an opportunity too good to ignore.
What Prompted This Consideration?
Strangely enough, my reflection on this decision began during dinner with my in-laws last night. They asked about gold prices after seeing a news segment on TV. From experience, I have noticed that when such topics reach mainstream media, it often signals a turning point – what I call “cannon-fodder” time. This is when retail investors rush into a trade just before the market reverses.
Call me cynical, but this pattern plays out repeatedly. Major investment firms looking to offload large positions often push stories to the media, generating retail demand to absorb their sales without disrupting the market.
I can’t say for certain that this is happening now, but selling into strength has historically paid off. Given my position, it’s a risk worth considering.
Geopolitical Considerations
There’s an additional incentive: if the Ukraine conflict finds a resolution, some of gold’s upward pressure could ease.
It is never easy to exit a winning position – especially one held for as long as this. However, as a speculator, there comes a time to say, “enough is enough,” lock in profits, and move on to the next opportunity.
This is a lesson I hope many crypto traders take to heart – especially those who have stubbornly held onto too many questionable altcoins for far too long!
The post The Ever-Changing Global Landscape first appeared on JP Fund Services.
The post The Ever-Changing Global Landscape appeared first on JP Fund Services.
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