Markets are cyclical. Forex pairs too. Crypto was very easy to make money in for the previous 2 years. This year forex has been easier although last week’s CPI data put a spanner in the works, if only temporarily.

However, as long as you control the risk (as per my short video last Friday) and follow the rules, you minimize the losses and live to fight another day!

Market Bias

Bias. I have a bias for each major currency pair. All economies are screwed at the moment, just some less than others! Euro, GBP, AUD, NZD I only want to short and usdchf and cad, bias is to long. Based on data and
history.

Trading strategy

The great thing is I use my M2 method for all markets. The only difference is that for stocks, indices and crypto I look at fundamentals a lot more before buying or selling.

Courage of conviction got me into lots of US bluechip stocks during the recent drops whilst most people were probably too scared to buy them. The potential upside was worth the risk.

I don’t normally buy them as I am not willing to tie up capital for annual returns of only 10% or less but the reward versus risk was way better than normal. Now the risk of a big drop is greater so I am out and will not get back in again until there is a significant drop.

I have taken all my profits (average 30% in 6 weeks on US blue-chips- would usually take years)! At the moment they have continued to rise and may go further. I have no regrets over selling my stock as I explained in the video, the current markets don’t make sense to me.

Michael Burry who was famous for ‘The Big short’ during the 2008 financial crisis has also sold all his stocks as he warns of an epic market crash on its way. He holds Geo group stock. Geo invests in private prisons and mental health facilities and commands a market capitalization of less than $900 million.

Michael Burry stocks warning

I also traded ETH and made a 60%+ profit. I still hold my core crypto portfolio which I accrued over the previous 2.5 years. I took profits and removed the initial stake so they are all now risk-free. I will buy more if we see big drops. If I was new now I would focus on BTC & ETH and cost average in.

Markets in general

Through the session, I went through multiple things that show us the economy is not doing well.

credit cardsFirstly the overall borrowing and credit card debt has risen to around $16.5 trillion. People are borrowing more money to keep up with inflation and housing expenses.

Credit card usage

U.S credit card debt rises

Secondly, the housing market is also suffering lately as builders and buyers struggle with higher costs.

The UK saw house prices drop for the first time this year according to a report from Rightmove. This was bound to happen after the rapid increase of interest rates across different economies. It will probably affect further as Banks are likely to raise interest rate further to control inflation.

Sentiment down in the U.S

UK house price drops first time this year

Inflation drives fastest fall in real pay on record – BBC News

Australia

Housing marketI advised in the webinar that Iron ore prices are falling.

This affects the AUD as its Australias main export.

Their major overseas “customer” is China.

China’s housing market is in real trouble and they have already defaulted on one of their payments this year.

It is too big to crash.

There is a report here that says 50 million flats are empty and they are finding it tough to fill them.

50 million empty flats

You can research more on economies using the OEC website I showed. It is always good to know the economy you are trading. It will help you to have an edge.

Iron ore

OEC Australia

My final piece of advice is to make sure to read behind the news, and keep an eye out on the yellow flag news. For example today we had the unemployment figures for the GBP. Tomorrow  you have the Core CPI rate for the pound.

As always, remember correlation! -Especially when taking more than one JPY trade!

728x90

We are NOT a “tipping service” our aim is to teach you how to trade for yourself.

You can watch the full webinar below: