Firstly please let me thank you all for the kind wishes while I was ill yesterday. It is greatly appreciated. Now that we have done that, lets get right to it:
What happened today:
Today was an interesting day which showed that pessismists and bears may be living on borrowed time. One of the three major rating agencies, Moody’s, cut its outlook on China and instead of tanking, Chinese equities soared to highs. This is a most encouraging sign that the market has come to its senses and realised that the world is not ending tomorrow. If oil does not completely capitulate this evening (after its inventory report) and equities perform well then Friday’s expected firm NFP and wage earnings will really put the nail in the coffin for all the recession kids. If the current trend persists, they will lose everything very quickly. If you are short on equities, be very careful. Chances are you got hammered the last few days and there could very well be a lot more pain to come.
Eurozone PPI was also terrible, showing massive contraction and I now change my outlook for this month’s ECB action. I feel that now they will have to do even more to combat their stagnant growth and shrinking inflation. I expect them to aggressively cut rates and massively increase their asset purchasing program. Anything short of this will lead the Eurozone into a steep decline from which it can not hope to survive, especially should the UK leave.
After a solid ADP report, it seems equities have pared some gains as people lock in profits and turn their attention to Friday. I highly doubt it is a recovery and is unlikely to rally far, unless of course Oil completely crashes this evening. Be warned my friends.
Our HF Trading:
We had a very mixed day. The morning, we made a killing. In the afternoon, we had poor results.
We made money by buying USDJPY, AUDJPY, EURJPY, USDCHF and selling Gold.
We lost money by selling NZDUD (turned to profit after stopping us out…) and selling GBPUSD (I do not understand why this one did not work, but we also got stopped out.)
I am happy to report that despite massive losses in the afternoon that after closing all our trades, we still managed to make a profit today of 1%.
This leaves us in the following situation this week:
Deposits active at start of week: $88,000
Profit made since start of week: $6332.15
Return on investment since start of week: 7.2%
I am happy with this considering the week is only half over and that we were virtually bedridden for one whole day. That and the fact that the market and spreads have been acting against us almost as if it is a national sport.
My suggestion to you:
Prepare for a shift in market sentiment. If you have not already done so, make sure you sign up at our CFD’s and IQ Option recommendations. On Friday I am being sent to Europe for 1 week by work and so will be not very active. However, as I travel from pace to place, I will be posting my suggestions on twitter (its easier to do than here) and you will not want to miss out. With sentiment already sweetening, Friday’s NFP which in my opinion will show a good deal of job creation and improved hourly earnings (due to wage pressures), will simply help banish this panic that has gripped the market since the start of the year, as finally everyone has come to their senses and realised that the FED will move in 2016 and more than once and the ECB will have to act this month:
- I was right about the FED doing this last year in December, calling it since August, while everyone sat on the fence saying it could not happen, only to change their minds the month before it happened.
- I was right about the BOJ acting earlier this year in January. Remember, everyone else was “shocked” but not yours truly who called it weeks in advance.
Remember this again. While everyone has said this year the FED will not act in 2016 and there will be no rate rises, sine the start of the year I have said they will act 2-3 times and most likely start in June, with a low probability of a March move. Let us see if I am right a third time.
Hope you all had a great day,
P.s. I am trying to get an idea of how returns are being split across the community and if indeed everyone is in the green. Please if you read this, just take a second to let me know your return in % not dollar amounts in the comments below. It will help me understand our overall situation better. It will only take you a second but greatly increase my awareness. Thanks.