Please note the political opinions expressed below are those of the author himself, and do not necessarily reflect the opinions of JP Fund Services AS.
A few weeks back, we floated an idea that turned a few heads: sell gold, buy oil. Since then? Golds slipped around 10%, while oils climbed about the same.
Now, we don’t issue formal trade calls – that’s not our game – but when markets move the way we anticipated, it’s worth taking a quick victory lap. Not for bragging rights, but because it highlights something essential: the best opportunities often sit outside the usual suspects of forex and crypto.
Why Diversification Still Wins
Diversification isn’t just an old investing cliché – it’s a survival skill. Traditional investors tend to stay within equities and bonds, while the younger crowd keeps its gaze fixed on crypto. Fair enough. But if you’re hunting for short- to medium-term opportunities, why stick to the same over-fished waters?
When there’s a big fish just below the surface, it doesn’t really matter which pond you’re casting into. The trick is knowing when to throw the line.
The Bigger Picture: Macro Still Rules the Game
Don’t get me wrong – what’s happening in equities and crypto right now is important. We could well be in the midst of the final rally of the year. But seasoned traders know the real alpha often hides in less crowded trades.
Take the Fed’s rate decisions: classic buy the rumour, sell the fact territory. Each move shifts the global risk-on/risk-off balance, creating ripples across asset classes. And then there’s Trump – wielding tariffs like a geopolitical Swiss Army knife – reshaping trade dynamics whether Europe approves or not.
As I write this, the Trump–Xi meeting looms – arguably the most consequential sit-down of the decade. Both leaders will declare victory, of course. But let’s be honest: when you control the world’s largest consumer market, you hold the better cards.
Commodities: Calm Ahead (and That’s a Trade)
For those of us in capital markets, this dynamic likely signals one thing: a period of stability in commodities. That might not excite the day traders, but understanding the broader directional bias is valuable – that’s gold, pun intended.
Keep an eye on OPEC, but many producers seem to recognize the benefit of keeping prices relatively contained over the next few years. And if we edge closer to a Ukraine–Russia ceasefire? Even better. Lower energy costs lift all boats.
Now, if only the renewable evangelists could find a way to fund their mission without taxpayer help, we might actually see a more balanced energy ecosystem.
Crypto: A European Twist
Meanwhile, something intriguing is brewing in France. The government seems to be warming to Bitcoin – talking about strategic reserves and even revisiting Basel standards. Could this undermine Brussels’ relentless CBDC push? Possibly. But as ever, betting on common sense from the EU remains a high-risk trade.
Sugar, Coffee, and Other Sweet Setups
Closer to the ground, I’m watching sugar closely. Prices are approaching historical support levels, and while we might see another cent or so of downside, any meaningful dip could be a sweet opportunity (literally) to take a small long position.
On the flip side, coffee looks ripe for a correction. A potential double-top is forming, and unless recent highs are broken, shorting rallies might prove a profitable play over the coming months.
Equities: Strength, But for How Long?
Equity markets continue to perform well – no surprises there. But how much gas is left in the tank?
In our recent Chartbook, we flagged the FTSE’s path toward 9,800, and we’re now within touching distance of that level. A break above could spark talk of 10,000, and while that would make for a great headline, it might also mark a blow-off top.
Given the UK’s domestic mess – and the potential for a China-brokered Russia deal that could hit the UK’s defence sector – blind buyers of “UK Plc” could be in for a rude awakening.
The upcoming Autumn Budget is unlikely to offer relief, and with no policy shift in sight for at least 18 months, my outlook for the UK economy (and for sterling) remains distinctly unenthusiastic.
Final Thoughts: Step Back, Look Wider
None of this is a recommendation to trade – it’s simply where I see opportunity and risk evolving over the medium term.
Markets are shifting fast, geopolitics even faster. Right now, “buy the rumour, sell the fact” seems to be the prevailing theme. But as we saw with oil and gold, sometimes the best trades come from stepping back – zooming out from the hourly charts – and spotting value where others aren’t even looking.
Because in this game, comfort zones rarely pay well.
The post Opportunities Beyond the Obvious: A Week to Remember and Lessons for What’s Next first appeared on JP Fund Services.
The post Opportunities Beyond the Obvious: A Week to Remember and Lessons for What’s Next appeared first on JP Fund Services.
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