I Am Watching These Two Markets and Why You Should Too

Guess which two markets I am watching right now?

 

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Let me tell u a secret about USD

Before I am going to share a secret with you about USD….let me ask you a question.

Have you ever wonder on recently, why USD seem able to rally and seem strengthen after a series of weakening and before that USD seem like heading to a new low?

Some of you who have look into economic data of US so far should be thinking the odd for September of rate hike seem diminishing since the positive NFP data, others data seem quite bearish on US economic outlook for August. Especially, this week data release.

So you might be thinking, if the chances of US Fed rate hike is smaller, the US dollar strength should be weakening yet the US dollar seem able to support at its old level, some currency pair able to trade slightly higher than their old time low. Do you ever ponder, why is it so? Who are those who willing to buy and support at those level despite the rate hike odd has decreased. What is the reasoning behind?

So let’s talk about basic fundamental of Forex. Not sure how many of the readers care about fundamental of a currency but I heard before from a Barclay trader who claim he is No.2 in his Forex fund management circle where he is able to generate close to 800% return a year. You might be thinking now..Wu ya Boh (really or not/ Too good to be true) but after i traded myself with his concept, I can tell you with his understanding on Forex and their strategy, making 800% return a year for full time trader is really possible (Still relative new to Forex but i am already achieve close to 1/8 of his performance).

What make them in the higher odd of winning is this. For all full time traders in his financial institution, despite they use technical analysis most of the time, all of them able to memorize all the currency pairs that they traded, their currency pair interest rate. What do I mean by currency pair interest rate?

For example,

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If they traded EUR/USD, they will know that US dollar central bank interest rate is at 0.5% while EURO central bank interest rate is at 0%. In a bigger picture and long term, they will want to buy a currency that has a higher interest rate. Why? Let me put into lay man term and show you some example, let say there is Bank A and Bank B, if you deposit your money at Bank A and they give you 1% interest rate every year compare with Bank B who offer you 2% interest annualy, which bank you will prefer to park your money, if both bank has almost the same level of  reputation, security and the list goes on, what is their difference mainly are their interest rate. I believe you will choose…Bank B right! It is direct, of course we want to deposit our money in a bank that give us a…Better rate! That’s right!

So when come to Forex trading, come to currency pair it is obvious we want to bullish on those currency pair that has higher interest rate. This is the fundamental 101.

So, you might be thinking now. Ok, then what is it going to do with US dollar. Rate Hike odd for Sep is like 10 to 12% chances and don’t tell me you are going to tell me US dollar is strengthen and rally is due to Sep Fed rate hike odd.

My answer to your question is nope. In fact, I am going to tell you something totally different.

The reason is simple as this, even no further rate hike this year, USD still attractive. You might be confuse now and wonder what is this guy talking about but let me hold you on for  a second, please be patience…let me just show you few things by doing the elaboration below,

On 2nd August, RBA (Reserve Bank of Australia) cut their rate from 1.75% to 1.5%

On 4th August, BOE (Bank of England) cut their rate from 0.5% to 0.25%.

On  11th August, RBNZ (Reserve Bank of New Zealand) cut their rate from 2.25% to 2%

What does all these mean? The global outlook is going to ultra low interest rate environment, every country is looking into more stimulus instead of recover their interest rate to their old time high.

This is contrary compare with US where they are in track to rate hike although the odd to increase their rate on this year is very difficult and challenging but if others peer are decreasing their rate while US Fed has the odd to increase..it will be looking so attractive now on US dollar. Please take a second to imagine and think about this, if during September US Fed did hike the rate, what will happen then? Can you imagine that?

This is why despite the rate hike odd is diminishing, the support of USD is still there, fundamentally it look attractive now. Remember the bank example?

Of course, this is just basic 101 intro to the currency, there is much more to it to justify the buying and that is the beauty of Forex.

Of course the bank example is a simple way to convey the concept of interest rate of a currency. The truth to it is much more due to its currency pair country’s domestic outlook and  economic(like in a more professional way and more close to reality of saying : central bank of a certain country if raising interest rate will cause cause monetary tightening, reduce money supply, reduce inflation and so on…so that currency will be attractive and appreciate, yup i know it might be information overflow to you so let me just stop at here)

If this is new to you then you might want to explore more on this as it will surely help in your Forex trading. There are a lot of “secret” in Forex trading..the more you explore it, the less risk you will be exposed. Most of the people around me always think that Forex is just a gamble. Let me tell you, it is definitely not a gamble, it is the ignorance of people that don’t understand the risk make it look like gamble.

The truth to the Forex is we all have been trading Forex, either you buying something from oversea or you went for a vacation for oversea, we did the money exchange trading too right? So why is it when it come solely on trading the currency pair or Forex it become a gamble? That’s an interesting question for you to ponder about.

Before I end this sharing, let me share with you Warren Buffet quote to end this beautiful Friday night.

Risk comes from not knowing what you’re doing.” – Warren Buffet

Have a great weekend ahead and safe trading and investing pals!

 

 

CRUDE OIL/USDSGD/USDJPY Key Level to watch (10/6/2016)

Last week has been an exciting week with NFP data release and causes US dollar strength to weakening with some group of players shout: SHORT! As fed interest rate decision is going to announce on next week, 16 June. A lot of shortist (market players that short USD pair) are currently covering their position to realize some of their profits.

During last Friday NFP data release did I short? My answer is No. In fact, I long…you might thinking deep inside of your heart that I must be mad…but that’s my play style for my home-ground forex pair, USDSGD and USDJPY. This whole year I only focusing on long position and I play a lot of counter-trend for this two pairs.

The thing you have to ask yourself when you are trading in Forex is, who do you get supply from? Who is on the other side of your trades? 9 out of 10 people don’t really care or don’t bother to ask or think about this question and that’s why only 1 out of 10 people consistently make profit out of these 9 people. That’s to say too, how I come out with my strategy and how I collect my position since April and profit largely on May.

Below are the USDSGD and USDJPY chart where the price has come into demand zone and prepare to rally with not many shortist dare to short at current moment and most of them want to realize their profit since last Friday or past few days. Having say that, it doesn’t mean that USD will rally strongly, if ideal case it will go back to the peak before NFP data release last week but chances are slim as most of the market players think that Fed interest is not going to hike this month, most probably and nearest to date will be on July. But no one can time market exactly so let’s time do the talking.

Below are the chart for USDSGD:

*The red area symbolize demand zone.

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USDJPY:

*The red area symbolize demand zone

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Also, I am looking at Crude Oil which I believe there is interesting key level to watch ahead where it is undergo pull back after rally above 50 for the first time. There is possibility to test demand zone area for the first time after it is able to close above 50 and see whether it can hold or not. If it is able to, high probability it will be a fierce rally after that.

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I am going to hold a Forex 101 webinar soon, for those who are interested to know about basic Forex are invited to join this webinar, I will be sharing the thought process behind why I long USDSGD, USDJPY and also why i prefer to short crude oil for the past 1 year and when I am going to long it. I will be sharing my trading journey with myfxbook statistic during the webinar and what you can learn from my trading mistake and my turning point that make me consistent to have a positive return after that.

I will be announcing the date and time at the email, the upcoming webinar will only cost you 49USD/66.50SGD

**1USD=1.36SGD

Registration Link,

Click Here To Register!

 

Disclaimer:
The information that contained in this article is to provide general advice and for information and educational purposes only. Any opinions, conclusions or other information expressed here does not constitute financial advice. They are given on a general basis and is subject to change without notice.
Any expression of any trading or investment idea is for sharing only and does not constitute an invitation to trade or investment advice. Readers will need to determine, with or without the assistance of a person licensed to give personal advice, whether any general advice received is appropriate for them given their particular needs, financial situation and investment objectives.
While all reasonable care have be taken to ensure that the information contained here is accurate, it does not guarantee the accuracy or completeness of the information. The blogger for this post will not be held liable for any losses resulting from any errors, inaccuracies or omissions in the information or from the use of the information. All information stated are presented strictly for educational purpose. It should not be viewed as an advice to buy or sell certain securities.
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(i) offer, advice, invitation or solicitation to buy or sell any investments, securities or other financial products,
(ii) invitation or inducement to engage in investment activities or financial promotions of any kind or
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The views/opinions expressed are strictly personal and do not reflect the opinions or positions of Amazing Trading Academy.
Note: Investing and trading may result in significant losses – readers are advise to take precautions and be responsible for their investing / trading actions

USDJPY Key Level to watch (8/4/2016)

Dear Readers,

This is my first post of my chart sharing. Most of the time i am preoccupied with my trading activity, once I am available I shall share some of my insight on this website.

As we can see USDJPY is undergo strong downtrend after few weeks of consolidation. Key support of 110 has broken and all minor key support below 110 has broken, now it is heading to the another strong key support at weekly 200MA.

Currently USDJPY is testing weekly 200MA key support, if this support break means the price can free fall until 106 or even 100. This is definitely an important price action to watch.

If you ask me what is my take on the future heading, if you are a trend follower I think my strategy won’t suit you as I am applying counter-trend, in short I am bullish on USD and i am taking the advantage of the USD weakness and waiting for a reversal with my counter-trend strategy. Aside of USDJPY which i just started to join the fun today, I have been mainly focus on USDSGD which i have apply my counter-trend strategy for few weeks.

Why counter-trend? That shall be our future topic. I am excited to share with you all the reasoning behind it 😉

Below is the chart for sharing.

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Ok, for readers who are new to trading or don’t know trading at all, what i am sharing on this article might sound alien to you but fear not, I will try to share bit by bit in my future articles. I will be sharing how I setup my own style counter-trend strategy too.

Alternatively, you can click -> sign up .Singapore most cheapest courses is here to let you instill some foundation to trading and investment. Best of it? It is a webinar! 🙂

Okay, I shall back to my trading. See ya!

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