EUR/USDBearish
GBP/USDBearish
AUD/NZDBearish
XAU/USDBullish
SPX500Bearish

EU struggles to pass 1.2000s as US markets fall from overvalued prices in the stock market. The pair is back in a support zone showing that price wants to go lower. A break in that support zone (which is a common pattern we see in a couple other pairs) would be a sign that we are in for continued downtrend.

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GU comes back for a second test on support without making a promising rally on the daily chart. GU has very strong support on the daily chart with June support and the 200 DMA. A bounce would seem likely, however, a break would be very bearish for the pair that's been running up since March.

AUDNZD falls to another low as it comes up to resistance. Key support is not very clear on the daily chart except for the 200 DMA way down at around 1.6000s. Gold continues to fall as well which is not good for the Aussie.

Gold now breaks through support, and a close below it would be more bearish for this metal. No clear support lies on the daily chart until the 200 DMA as well. A short term bearish bias is definitely viable for gold, but only because USD rises in times of panic or crisis. USD will continue to rise as markets fall, but that will not last over the long term in my opinion. For reasons stated in the other articles I've written, USD will fall again due to the immense amount of money printing we saw earlier this year with inflation rising. Gold also tends to outperform the markets and is less volatile. This pair is definitely a safer place to put your money.

Before I continue, do you see a pattern here? All these pairs are dropping, but why? What all these pairs have in common is their correlation to US equities. When the US market falls, these pairs drop as well. When the market saw its largest bull market in history, so did these pairs.

After creating lower lows on the daily chart, the market continued to sell off hard as soon as it opened this morning. SPX500 is currently hovering on support, but key support lies on the 200 DMA. If price comes down here, we will definitely see a bounce, but the question is: will it be enough for another bull rally? The market historically uses that moving average as a place to long again, but uncertainties with the election, coronavirus vaccine, cases rising again, lack of stimulus, inflation, suffering economy, etc. is aligning for a fearful market. After a season of greed, fear steps in and takes over market sentiment. With September being a month of selling also contributes to bearish sentiment. This is because the months before are usually high-profit periods for investors.

Regardless of the fear taking place, I think this downside movement is healthy for our market. A correction like this was a long time coming, but the bulls wouldn't let it drop. What we're seeing is just a big flush out of stocks so the market can find a balance at 'reasonable' prices for investors to find more attractive. If you plan on investing or putting some money in to the market now, the best thing to do is to dip your toes in. Don't be swayed one way or the other, just be ready to hold whatever you have for the long run. With a small amount of your portfolio in the market or major pairs, you can always long again if prices continues to work against you.

Remember, this is not a time to panic like most sellers. Keep a cool head and trade on! With proper risk management, there is nothing to worry about; especially in the long run. Stay safe and trade safe.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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GBP/USDBearish
XAU/USDBullish
SPX500Bearish

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GBP/USD

GU broke a long term upward trend line on the daily and 4H charts which dipped price below key support. With poor Brexit news and an uncertain US economy, the pair is stuck near a decision point. The pair has been climbing for months after the crash in March, but now faces heavy resistance. Bad retail sales reports on USD is probably what's causing this rally up to resistance, but my overall sentiment remains bearish, and a possible future lower low will come out of this on the 4H chart.

Indices will have a volatile day as the Fed chairman is set to speak at 2:30 EST with FOMC economic projections at 2:00. The SPX still hovers below resistance on the 4H chart after its steep decline starting from 2 weeks ago. Today will provide further insight on the market's direction from now up until the election. The 200 SMA on the 4H chart suggests that price is very uncertain on where to go. It seems to be taking turns stabilizing just under or over the moving average as investors wait for the FOMC projections. I remain bearish for the week unless price breaks over that resistance level around 3430s.

After breaking out of former wedge, gold makes higher lows on the 4H chart and hovers around the 200 SMA. In the long run, gold outperforms the benchmarks, but still dips a little with each market retracement in the short run. Big money and analysts think that this metal has the potential to climb as US economy and USD decline. I remain bullish on this metal and believe that a test at 1990s would be likely in the next few weeks. However, poor US economic data could hinder the stock market which could adversely affect gold. The dips are not as momentous and recoveries outperform indices.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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After the steepest drop in US equities in history back in February, the stock market rebounded 63% and passed all-time highs from pre-crash levels. With an economy that was once booming turned into a recession, but the market did not seem to care from the belief that the Fed would keep money flowing in and the banks, during a period of almost 0% interest rates, had nowhere to put their money except in the stock market. Led by tech, the market climbed higher than ever before. USD pairs got crushed as GU and EU skyrocketed. Although the S&P has already dipped over 6% in the past week, it seems that the time to buy is not that attractive to investors. Here are some reasons why:

Illusion of the Fed

The Fed, with seemingly unprecedented power to fuel the equities market, made investors feel backed by the central bank to where the market had nowhere to go but up. There was an illusion that the Fed would never let stocks dip whatsoever, but that can only go so far. Fueling the market means printing money, which means increasing debt and inflation. If interest rates rise, the market will tumble as well, so interest rates need to stay low while the USD deals with inflation rising. Keep in mind that interest rates were already very low to begin with as Trump promised the best market we have ever seen. Once corona hit, interest rates only had so far it could go before it reaches 0% or negative. Yes, it is true that missing this most recent bull run killed bearish sentiment, but the bears aren't going to sleep forever. The Fed won't keep printing money forever, and at some point, it is not up to them where the market decides to go.

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The lack of new stimulus

Millions of Americans are still out of work, even more so than the great financial crisis of 2008. The unemployment numbers have been greater than 2008 for over 6 months now, and companies are still having lay-offs. Initial jobless claims data shows that the economy is not really recovering. We finally dipped below 1 million a few weeks ago, but the number each week has now been hovering in the 800,000s. The damage done is irreversible, and will take a long time to recover. Some analysts expect 8-10 years to be fully recovered. However, this will not necessarily affect the stock market and major pairs as much. The fact that Americans have been out of stimulus payments since early August shows the true colors of Congress as Democrats and Republicans continue to debate over which package is best. Now is not the time to push agendas or make Capital Hill look bad. It's time to put differences aside and help the people that need it.

Vaccine Drawbacks

News on vaccine has definitely been a major driver in the market's direction this year, but failures in the trials have brought fear back in to the minds of investors. After one patient in a voluntary vaccine trial came down with an unknown illness, the market freaked out and dipped hard with big tech leading the drop. The first step in this biological crisis is to find either a vaccine or efficient treatments to the virus and stabilize the number of cases. The number is still rising now that schools and universities are calling students back to campuses. The University of Georgia made business news when cases spiked over 1,400 positive tests. Sports teams are postponing games, some teams are not playing at all, and billions of dollars in revenue could be lost if cancellations continue.

What will tomorrow bring?

Tomorrow and next week will be interesting. Last week had moments of short-term uptrends forming before price got wiped out again. This pattern happened a lot last week. The bulls are losing momentum with all this crazy news coming out, and tomorrow may be grim. The market is following the same pattern from February: sell offs begin to bring price down before that big correction happened of -34% on the SPX500.

You can tell that the dips are becoming successfully more aggressive the higher we climb. The red candles are now overpowering the green and this recent dip has already wiped out 3 weeks of gains. The healthy thing would be for the market to correct making stock prices and value reach closer to equilibrium. Otherwise, we will see a bull market run completely by FOMO investors who want to make a quick buck on each swing up, and an inevitable correction farther in the future will be worse than if it were to do so now. Since the market has dipped back into correction territory, it's time for it to make a decision. Will we continue to buy in to the Fed-fueled rally, or will we let the market healthily correct so that it makes more sense to start investing again?
We will find out soon.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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GBP/USDBearish
AUD/NZDBearish
SPX500Bearish

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GBP/USD

GU broke a long term trend line on the Daily chart, sending price below support around 1.30460s. Today's rebound happened synonymous with the US market, which occurred for no clear reason other than investors might have been looking to buy up to level out their accounts before another major sell off. GU also sank with poor news on Brexit which may continue GU's decline. Possible short setups look clean at 1.30460s.

AUD/NZD

This pair looked to be recovering off the 200 period moving average on the 4H chart, but it is now showing some clear rejection from the candles. Gold is still trading mostly sideways so, there is a different reason for the pair to continue its dip below highs. We have a short term bearish sentiment on this pair as Aussie is still favored by most investors, but a down trend looks probable in the short run.

SPX500

The 4H chart shows clear rejection on that falling trend line, but a lot can change from now until market open. Jobless claims reports, which have been major drivers of market direction, is expected to be a little lower than last week's. This could be a good sign for bulls if claims are as expected or better, but a greater problem looms: big tech is now losing momentum after a long August run. A break in that trend line would be good news, although it does not look like it has enough momentum to carry passed that level. Shorting the market is always too difficult as the market tends to sell off hard before it recovers twice as much. With the newly mounting millions of retail investors trying to place a stake in the game this year, strategists see this as a possible concern for the market since it's brought stocks up to well overvalued. What we may likely see over night on smaller time frames is the price creep up before a big sell, and repeat.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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AUD/NZDNeutral
USD/JPYBullish JPY
USD/CHFNeutral
XAU/USDBullish

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AUD/NZD

Another wedge forming on the pair as it hovers in consolidation zone. A breakout could be bullish for Aussie, but GDP q/q report this Tuesday is expected to be much worse than last quarter at -6%. AUD does have an advantage over the New Zealand dollar which would stem from their gold industry. Gold is looking more valuable to investors now that the USD is going to keep depreciating over time. AUD's report on GDP today will be big in picking a direction, and if the report is as-expected or worse, we can count on this pair to continue to fall.

USD/JPY

USDJPY sentiment is still bearish mostly from weakening sentiment on the USD. Analysts seem to be favoring the yen as the Bank of Japan has record high debt issuance and while the US now has limitations on their businesses to work with Chinese companies. Here on the 4H chart the pair is struggling to break that 200 period SMA all while stuck in a wedge. We see a potential short set up on that moving average as well as the top of the wedge and a close/break below the rising trend line.

USD/CHF

The pair crossed below long term support from back in May 2015. Now price is coming back up to the new resistance. Despite this, investors are bullish on the pair. It looks like price is trying to break that hard trend line where next key resistance lies around .93750s. A breakout would be good news for the pair, so we're remaining neutral until movement is decided.

XAU/USD

Gold seems to be up against resistance on a key Fibonacci level around 2000. Although technicals are important, we don't believe them to be too notable for this pair since the Fed's recent actions regarding inflation and extreme stimulus measures. One analysts sees price over 2000 by the end of the year with the possibility of it outperforming the market once again. 2000 is the major level it needs to break which would be the biggest bull sign on the metal.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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Politics preventing new financial stimulus

The economic recovery in the major global economic powers depends on several important factors. One of the most vital part, the spread of the virus and the government's answers to it. With a decrease in daily cases of COVID-19 to 50,000 in the U.S.A. Yet U.S. A remains the most significant global threat being the largest economy in the world. The trend of the virus in Europe has begun to worsen. With the majority of countries experiencing an increase in the past weeks.

The economic impact of global shutdowns, although severe, was cushioned by massive government aid and hawkish monetary responses everywhere. The U.S., after a slow start, introduced the most aggressive fiscal response in the form of its $3 trillion CARES Act. This funnelled cash to businesses and workers impacted by the pandemic and got forced into lockdown. 

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It had a significant impact on consumers, in particular despite a 10% reduction in salaries of employees in April. Due to substantial job losses, individual incomes in the U.S. A grew by approximately 10% due to a doubling of government funding. This mainly came through further unemployment assistance that entitled people to an additional $600 a week in aid. Despite this surge in government support, the household savings ratio increased to over 30% in contrast to an average savings rate of just 7%. Only to fall falling to 19% in June. However, there are critical factors here that contribute to the falling of savings rate: Those in the higher-income brackets, who would be less likely to have been affected, have seen savings spike. Those who were more likely to have needed the additional unemployment aid had a higher inclination to consume their stimulus cheque on necessities. Consumer spending is vital to any economy, especially in the U.S.A., which accounts for the vast majority of U.S. A GDP, is therefore vulnerable to the suspension of this stimulus cheque. 

These payments have been stopped at the end of July, and although President Trump has authorised a temporary (reduced) cost, there is no certainty about the policy beyond the end of this month. This is due to the ongoing conflicts between Republicans and Democrats on the next stimulus package. Democrats initially intended a package worth $3 trillion, with Republicans at $1 trillion. It appears that significant steps forward have been made towards a new stimulus package, but notable differences among them still remain. 

Given the fast-approaching nature of the election, it is unlikely that legislators on either side want to be criticised for another spending slip and citizen unease. That is why I still think a deal will be completed. Given the ongoing excitement within equity markets, it is likely that the market is also anticipating a deal to be done. 

Draghi returns  with Advice for policy maker

Former E.C.B. president Mario Draghi sent the current policymakers some critical advice about how best to control this financial crisis. His advice is really deserving of notice.

The speech is jumbled with historical quotations, such as to the wars, the global financial crisis of 2008 and the euro sovereign crisis of 2010, but we take away a few crucial bits of advice that are relevant to how policymakers may deal with today's obstacle. 

  1. This crisis is something modern policymakers have not yet seen so needs flexible thinking and innovative solution. The urgency and severity of the economic downturn caused by the pandemic that sticking rigidly to conventional views of monetary and fiscal policy risks worsening and lengthening the downturn the world is in. Policymakers in this crisis have shown to be realistic in introducing economic and fiscal assistance which we have never seen before. These actions have cushioned the fall for employees and corporations. For this efficient response to the global recession, they earned our respects. In European circumstances, it was feared that monetary rules would hurt governments from making these kinds of decisions. However, the European Commission has shown a sensible approach in waiving the rules for 2020 and possibly, for 2021. With blended resources also expected to be used for the first time, the union shown in the alliance of nations is a welcome and surprising characteristic of this mess.  
  2. There is what we can call "good" debt and "bad" debt. The significant increase in government debt levels due to crisis-related expenditure is sustainable, but only IF the funds are set towards productive uses. The actions of the E.C.B. have facilitated this. But it is not a cure. In the first instance, Draghi advises legislatures to protect the vulnerable to ensure social union. We have seen social division rise during this time, also causing major unrest. However, resources must be put to productive use and not wasted. In consequence of World War II, this took the form of a reconstruction of physical infrastructure throughout Europe. This time around, Mario Draghi advises that the investment should take the form of large-scale investment in human capital. Education is seen as a crucial part of the growth in productivity and economic growth. If economies are to prosper and the debt is to be paid back in the future, governments must have a revived focus on growing the productive potential of their economies. 

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Warren Buffett, one of the most successful and richest investors of all time, long-time owner of the established conglomerate, Berkshire Hathaway, and mega bull has recently turned bearish on the US stock market. Granted, he has been saying this since the April rebound, but he finally put his money into action.

Although Buffett would probably never short the market, he decided to get rid of his bank stocks by dumping JP Morgan, Wells Fargo, Goldman Sachs and other banks with smaller positions. He sold over 250 million shares, hundreds of billions of dollars worth in total, but that's not all.

https://www.cnbc.com/berkshire-hathaway-portfolio/

The oracle of Omaha had also replaced his stake in bank stocks for a gold mining company, Barrick Gold Corp (NYSE: GOLD).
But why sell bank stocks when the Fed has funded them with trillions of dollars and pushing the S&P passed all-time highs?

Surprisingly enough, bank stocks have largely under performed the market in this latest bull rally. This is due issues regarding credit and debt; Analysts expect banks to be close to $900 billion in losses by 2022, according to CCN.

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https://www.advisorperspectives.com/dshort/updates/2020/08/04/market-cap-to-gdp-an-updated-look-at-the-buffett-valuation-indicator

Here's the indicator Buffett uses to measure the Wilshire Stock index valuation compared to overall GDP. The way it's measured on this site (which is the accurate way) is by taking the annual GDP from Q1 and using that as the denominator throughout the year. So, it is basically the index divided by Q1 GDP.

In most recent numbers, GuruFocus has us at 179%, which they consider 'significantly overvalued' for the market. They also predict a 2.9% decline in stock market returns this year.

https://www.gurufocus.com/stock-market-valuations.php

What Now?

It's hard to predict what is going to happen in the market with tons of factors at play. For example, two weeks ago, jobless claims dropped into the 900,000s range, and investors believed the economy was recovering. The market shot up. Last week, jobless claims (which have been driving the market either up or down) reported back over 1 million at 1.1 million. Despite bad news, the market shot up harder than the previous weeks.

The problem investors are running into is that Wall Street will tell you that the economy doesn't reflect the stock market. And when there's bad news about the economy, the market tends to go up. However, when there's good news about the economy, that news matters all of the sudden, and it causes a buying frenzy. As an investor who's got most of their money sitting on the sidelines since April, it's frustrating to try to get an idea of when is the best time to buy. Do we brush off the fact that the US is in a recession? Do we join the hype train and ride with the bulls?

The answer is painfully simple: Bull and bear markets all come to an end eventually before it resets. Look past the trees and view the whole forest. Is a vaccine going to fix the damage already caused by the pandemic? Most stocks on the S&P 500 are showing negative returns expect for a certain few. There is lasting damage to the economy, and if you were forward-looking, it would make sense to see the market reflect that in stocks. Some analysts are talking years of rebuilding before the economy 'normalizes' again.

Here is the US30 on the 4H chart showing long wicks on both the tops and bottoms of several candles. That is a big sign of uncertainty where investors can't decide on what to do. No one really knows what is about to happen in the next week, month or year, not even Buffett himself. It's about being rational and understanding what makes sense in the long run.

Put yourself in an unbiased position and ask, 'should the S&P really be at all time highs right now?' The obvious answer should be no, but again, the market does not always make sense.

What to Look Out For This Week

Watch for vaccine news: This week may see another frenzy of buyers as a successful breakthrough on treatments to the coronavirus will most likely become approved by medical officials.

Watch Big Tech: The stocks like Amazon, Apple, Google, etc have been the main drivers of the market. Analysts are finding long entries on all of these companies excluding Netflix.. Traders are likely to follow.

Watch Technicals: This is definitely a trader's market now. News does affect price, especially good news, but indices are respecting lines of support, resistance, breakouts, wedges, etc. On the 4H chart, the US30 broke above the wedge with a strong green candle. A break in highs could mean that the SPX500 might want to continue its run for now.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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AUDNeutral -> Bearish
USDBullish
EURBearish
GoldBullish

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AUD/NZD

AN coming off highs from 2018 after RSI hits a significant level of 83. The pair is looking more volatile now as the 4H candle closes below the rising trend line. Analyst at HYCM, Giles Coghlan, mentions that the pair moves similarly to the S&P 500 which has recently broke all-time highs. However, gold is also taking a break amidst the ending of the so-called 'shortest bear market' for US stocks. This also affects Aussie pairs due to a gold-heavy economy. 65% of traders are net short according to DailyFX and sentiment is mixed now that price has been climbing higher for the past several months.

USD/CAD

Despite the punishment this pair has taken recently, we still remain bullish with the thesis that USD will see a rally soon. The daily candle showing some pressure to the upside, and a close above the trend line would be a good sign that price wants to start moving back up again. Cutting production has boosted demand for oil and has fueled the CAD sending this pair in a downtrend. Any news on oil will most likely affect this pair as the USD rally may be able to start.

EUR/JPY

EJ continuing to push lower here on the 4H chart. German and French PMI news is to be reported for this month with mixed forecasts. Some forecasts are suggesting a lower PMI data for the German economy and higher for the French. 4H candle crossed under the rising trend line, showing signs of weakness on the up trend. 53% of traders are net short on the pair so sentiment is still mixed, but traders may start going back to risk-off sentiment and hold the yen as it is considered a safe haven.

Gold continues further to the downside as it approaches its 200 period moving average. The Federal Reserve decided not to cap the yield curve which investors took as bad news. A weakening dollar is still impacting lots of pairs like USD/CAD, so it might seem odd that we are bullish on gold yet expecting a rally in the USD. Gold seems to be the move in the long run, but the USD might see some more demand as the US economy is slowly deteriorating due to combined risks with China, inflation, unemployment stimulus expiring, and much more.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

USDBullish
NZDBullish
AUDBearish
BTC/USDBullish

USD/CAD

After good CPI news for the USD, the pair continues its downtrend. Expectations were .3% and we got .6% reported. Oil demand seems to be rising which helps out Canada's economy. Limiting supply has really helped with oil demand. The US expects a higher production for the rest of the year while investors think a recovery is underway. Some key support around 1.32100s, and a break in this level would be bearish sentiment. Inflation on the USD seems to be taking its toll on pairs like these. We're looking at a bounce off support and test the 200 DMA or next resistance at 1.34980.

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NZD/JPY

NZD/JPY reported cash rates to stay the same yesterday, and the pair rallied on that good news. Some analysts think the Yen will rise on US-China tensions which is a bad sign for both economies and the Yen is considered a safe haven. We're looking to see price run up to resistance at 71.649 before we get bearish sentiment and the pair takes a second retest in the consolidation zone.

AUD/USD

Unemployment rate and employment change is to be reported later today on Aussie which will be a volatile moment for the pair. Expectations are low as unemployment forecasts at 7.8% from 7.4% last month. Both the USD and Aussie are suffering from their dollars weakening, however, with good news on the dollar, we may see a rally soon. The USD has been beaten down the past couple months and analysts are expecting a rally on the USD pairs. The dollar index (DXY) hovers around 93 after coming up from 92 last week. Long term, the dollar looks like it could weaken over the years as trillions of dollars are being printed, but for now, we're looking for a rally here soon. Now that the global economy has slowed, tensions between the US and China are terrible, and governments are concerned of another coronavirus wave, investors will turn to safe-havens like the USD.

BTC/USD

Speaking of safe-havens, Bitcoin might just be something investors want to put their money into. The idea of investing in something other than fiat money seems attractive during times of economic hardship, especially when a country's currency begins to weaken. When the crypto failed to break the 12000 level, investors talked about potential shorts. However, it looks like Bitcoin wants to come in for another test on resistance which could be the time it breaks to the upside.


Disclaimer:

Please note that this email is my personal opinion only. I am not a licensed financial advisor, and any information shared or discussed is not to be construed as investment advice. Trading and investing involves a degree of risk, and is not suitable to all investors. Please consult with your financial advisor before making any sort of investment decisions.

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Setting goals for yourself when it comes to your performance in the financial markets might not be as straightforward and simple as you may imagine. 

It's essential to set a goal whenever you're working towards something in life, otherwise how will you ever know if you've achieved it? Goals can be motivating and are often really helpful in keeping you on the right track to achieving success.

However, it's just as important to spend time ensuring the goals are meaningful rather than purely inspirational and spur of the moment thoughts. Things that are actually going to help you reach a desired outcome and monitor your progress towards achieving it.

For example, when you set goals for your trading/investing progress, have you ever relied on statements along the lines of "I want to become more profitable" or "I want to open more great trades?".

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I have to hold my hands up to that one, I've used goals like that in the past - most traders have! Unfortunately, these sort of blanket statements just fall into the category of 'easier said than done'.

We need to get more specific. We all set these blank goals in life. We set ourselves these vague goals often. Saying I want to be a profitable trader is just like saying I want to be able to run a marathon or I want to get all A’s in university. 

To be able to truly achieve your trading and personal goals you need to get specific and consistent with your goal setting.

Setting the right goals

Each of us has different strengths, weaknesses, and past experiences that affect our trading. Some may be highly risky traders as they have not yet encountered a reality check by Mr. Market others may be risk averse. We all have different areas we need to work on in our trading approach if we want to progress and succeed in the markets to become profitable traders.

By using a blank statements about our overall trading, we're not really going to be measuring progress in the areas that really matter to us individually.

Rather than setting goals and measuring our success based on improvements only in our P&L, we should be identifying points that are holding us back and find an appropriate measure that shows progress in that specific area. 

Many traders need to focus on their risk management (which I believe is the key to a long career in the markets) setting specific goals such as no more than 2% per trade or after 3 losing trades walking away from the screens. Stopping to trade when you feel that you will over trade or start revenge trading. If this is something you struggle with get some help! Invest in your education here with A1 Trading

Other traders may need to focus on not jumping the gun! Not entering into trades too fast, not checking macro-economic data or not looking at the economic calendar to see if there is high volatility news due, as we all know trading before major news releases is very risky.

By doing that, it will help us to focus our development plan in a way that's meaningful and encourage trading in a way that's more sustainable. Things that avoid us being tempted into risky approaches in an attempt to hit profit targets, without any improvements actually being made to our ability.

What's your ratio ?

To help put this in to practical terms, there's a quote from the book 'Good to Great' by Jim Collins that has always resonated with me. It's intended to apply to business, but I think it can also be adapted to apply to trading or any other area of your life you're hoping to improve.

"If you could pick one & only one ratio - profit per _____ - to systematically increase over time, what _____ would have the greatest and most sustainable impact on your economic engine?"

That's definitely something to really focus when making realistic goals regarding your trading. The word 'sustainable' is key here - we don't want to hit a profit target for the sake of it, but instead we want to see an improvement in our approach to the financial markets in a steady & sustainable way. Improvements that lead to dependable and repeatable returns in the market, not a one-hit wonder. 

If you want to check out one of the best one hit wonders where one Forex trade generated over $300Million profit click here a1trading.com300-million-one-forex-trade

Have a think about you ratios as a trader - what would your ratio be that you want to improve? What would show that your performance as a trader / Investor is moving in the correct direction?

If you're an A1 member, let's discuss and share our specific trading goals in the discord server 

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