Last week presented a significant divergence in outcomes for investors, with some experiencing substantial losses, while others capitalized on the volatility. This is a common occurrence in the markets.
The magnitude of the market’s move caught me off guard. However, despite being surprised, my overall portfolio remained resilient, and, in fact, benefited from the volatility. A cheekily placed buy order on BTC at $50,000 was executed as stop-loss orders were triggered, which proved to be advantageous.
Regarding my EUR/USD position, I had a buy stop set at 1.1050, which came dangerously close to being triggered. Fortunately, I narrowly avoided this outcome. Nevertheless, the potential for further dollar weakness remains, and I’ve opted to maintain my stop-loss order as is, and would not be surprised to see it elected this week, (possibly before this report is published).
At present, the focus is squarely on the U.S. dollar, particularly as the race for the White House heats up. The current election cycle features candidates who are more distinct from one another than we’ve seen in recent memory.
I make no secret that I am a supporter of Trump and anticipated his victory. However, Kamala Harris, with strong media backing, has a realistic shot at securing the presidency. From my perspective, a Harris win would reinforce my bearish outlook on equities.
That said, a Trump victory does not necessarily signal a bullish trend for equities either, as the nation’s debt remains a looming issue. The only thing I am hoping is, with a business-friendly and economically astute president, the U.S. and the rest of us, might experience a softer economic landing.
Some might argue that my recent stance on commodities—favoring purchases during periods of weakness—doesn’t align with my bearish outlook on the equity market. However, my commodity strategy is driven more by seasonal factors than by long-term trends. Additionally, if my outlook on the dollar proves incorrect, which it may, further dollar depreciation could validate my expectations for higher commodity prices in dollar terms.
There is much speculation surrounding the Federal Reserve’s actions, regarding interest rates. While many experts weigh in on this, I prefer to focus on more tangible indicators. Continued increases in unemployment in the private sector will likely offer a clearer direction for the economy than minor adjustments in interest rates. In fact, a misstep by the Fed could exacerbate private sector unemployment significantly.
As a British expatriate residing in the EU, I have closely monitored developments in the UK, especially under the new Labour government. The recent protests are troubling and could have broader implications.
A more significant concern would be the spread of these protests across the Channel, potentially destabilizing the Eurozone. Despite media narratives, there is considerable sympathy across Europe for the British working class from people who are suffering with similar concerns.
While our primary focus is on potential market movements rather than political developments, it’s impossible to ignore the impact of these global changes and trends on the markets. To dismiss these influences would be unwise.
In such historically uncertain times, holding gold and buying Bitcoin during periods of weakness serve as hedges against political turmoil and economic decline—strategies we have long discussed and that have thus far proven effective. Diversifying across various markets and products is also prudent, given the cloudy economic outlook.
However, every challenge presents an opportunity. In the coming months, the silver lining for traders will be the numerous short-term opportunities the markets are likely to offer. Whether your focus is on equities, currencies, or commodities, if you remain agile and employ sound risk management, there will be ample opportunities for profitable trades throughout the rest of the year.
The upcoming months will favor proactive speculators over long-term investors. Therefore, it is crucial to ensure that all market exposures are protected with appropriate stop-loss orders to mitigate potential losses.
We live in a time of too many influencers and bullshit merchants, both in the political realm and in our investment world, many of whom have a knack of merging fact with fiction to such a point we can never be confident of what we are told.
In times like these, I feel it is imperative that speculators spend as much time as possible improving their technical analysis skills, and rely on factual historic price action and chart patterns, rather than questionable statistics and adjustable economic data.
Opinions and data can always be wrong, but the market is always right!
The post Was That It, or Is There More? first appeared on JP Fund Services.
The post Was That It, or Is There More? appeared first on JP Fund Services.
The post Was That It, or Is There More? first appeared on trademakers.