Set ups for the week ahead
In this week’s educational section, let’s look at the Chinese economy.
Understanding China’s economy requires examining its key features, growth drivers, challenges, and global impact;
Size and Growth: China has the world’s second-largest economy after the United States. Its economy has been growing rapidly for decades, driven by factors like a massive population, industrialisation, urbanisation, and export-oriented manufacturing.
Reforms and Opening Up: China’s economic transformation began with Deng Xiaoping’s reforms in the late 1970s. These reforms shifted the country from a centrally planned economy to a socialist market economy, emphasising private enterprise, foreign investment, and global trade.
Manufacturing and Exports: China is known as the “world’s factory” due to its vast manufacturing capabilities and low-cost labour. It has been a global leader in producing goods such as electronics, textiles, and consumer products, making it a major player in international trade.
Infrastructure Development: China invested heavily in infrastructure, building extensive transportation networks, energy systems, and urban areas. This has facilitated economic growth and improved connectivity.
State-Owned Enterprises (SOEs): Despite market reforms, China retains a significant presence of state-owned enterprises in strategic sectors like banking, energy, and telecommunications. These SOEs often receive preferential treatment and government support.
Technology and Innovation: China has been working to transition from a low-cost manufacturing hub to a high-tech economy. It has made strides in areas like telecommunications, e-commerce, artificial intelligence, and renewable energy.
Consumer Market: The rising middle class and urbanisation have led to a growing consumer market. This shift has prompted a focus on domestic consumption and services, moving away from an export-reliant growth model.
Global Trade and Investment: China is a key player in global trade and investment. Initiatives like the Belt and Road Initiative (BRI) aim to enhance connectivity and trade with countries across Asia, Africa, and Europe.
Challenges: China’s economy faces challenges including an ageing population, environmental degradation, income inequality, high corporate debt, and a need for financial reforms.
Geopolitical Impact: China’s economic rise has led to increased geopolitical influence. It’s a member of various international organisations and has become a major player in diplomatic and economic negotiations.
Let’s look at some key charts.
Broke out of a major area as shown before. Pulled back into the area this week and I now looking for price to ‘slow down’
Energy & Metal Prices;
Still above the 200 and 55 and still very bullish to me.
Bounced off a big area and testing the 200 now.
Still consolidating at a big area (30000 is a BIG level for BTC). Break and hold above this level could see BTC go on a run.
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Red flag news:
Relatively quiet news week, this week.
See the video for a more detailed explanation on my thoughts on the majors.
EUR/USD: Long from 1.0800
USD/CHF: Short from 0.93400
GBP/USD: Long from 1.2500
AUD/USD: 0.67800 is key for me.
NZD/USD: 0.6200 is key for me.
USD/CAD: Long from around the current price point.
USD/JPY: *Long from 135.00 or 136.00
EUR/GBP: Short from 0.8650
EUR/AUD: Long from 1.6000
EUR/CAD: 1.46800 for a long
AUD/CAD: 0.900 is key. Looking to short.
GBP/AUD: Long from 1.9500
GBP/CAD: Long from 1.6800
GBP/CHF: See video.
AUD/NZD: Short from current position
As always, remember correlation! -Especially when taking more than one JPY trade!
M3 -Shorter timeframes.
I do my analysis on daily and weekly charts first and make a note of the MAJOR areas of support and resistance. Then copy them onto Pierre’s Earth and sky template. Then I make a note of the weekly & monthly pivots points and add them to the charts. You will see lots of opportunities line up during the week. The important thing then is to select a bias for the next few days and do NOT take trades if the price is too near a trend line or pivot. Ideally, you want to buy when the price is near a major support and or pivot point line and has the potential to make at least 40 pips. Vice versa for a short.
New members, please note: If I am looking to take a trade long, for example, 1.5000, I place my order 10 pips above & 10 pips below for a short. This is because price often does not quite reach a major line and you need to allow for spreads.
We are NOT a “tipping service” our aim is to teach you how to trade for yourself.
Watch the video below for more detailed explanations of this week’s analysis and trade plan (click the 4 arrows bottom right to view full-screen):