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An excellent start to the New Year Print
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To say that confusion and division reign is something of an understatement!

Dare I mention the 'B' word? Very definitely not in polite company. It has the potential to reveal the rawest of emotional responses. Trump? Again, avoid anything other than the consensus view that he is most unlike any POTUS we have known before. Privately, we can perhaps attempt to debate with ourselves, if we have open minds, but these seem to be in short supply.

The markets are reflecting the mood with pundits taking their positions. Strong Dollar or weak Dollar? Collapsing stock market or no need to panic? Interest rates too high in the US or must they rise in the EU?

Certainty

The only thing we can be sure about is that the political and economic landscape has entered what may be a long period of major change. The certainty is most likely, ongoing uncertainty. Open minds are needed now more than ever.

A great start to the New Year

Despite the stock market tumble in December, Gold and Silver took off and stock markets are recovering for a great January so far. The US Dollar has now dropped back from the brink of plunging China into crisis. So, perhaps, armageddon and the 'everything' collapse will have to wait a while.

Consistency

TMEST also had a good start to the year. The chart of one of our favourite currency pairs, the CADCHF gave us a quick 126 pips and there could be more to come. It's not just currencies of course, we have also taken profits from the Gold and WTi Crude oil trend reversals.

This is one of TMEST's most consistent reversal patterns. The horizontal red lines picking out the entry and exit. The previous down trend ended with a break out, pull back and higher low, or BOPBHL pattern.

TMEST is a part of 'The KISS system of trading for life' that I will be presenting at the RTCT online summit, in February and at the Forex Show on Friday 22nd. No charge, sign up here.

 
Gold Silver Ratio Print
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Wednesday, 19 December 2018 18:15

Today is the Day & The Case for the Gold Silver Ratio

 

Will Christmas come early for the Donald? Will he get his demand of lower interest rates from Father Christmas Powell? Today is the day that could see a major reversal, or just the same old, same old.

A quick re-cap. The fed have made a couple of 0.25%, or 25 basis point, increases to the Fed funds interest rate this year. Signalled by the Fed, the market is fully expecting Wednesday the 19th December will bring the rate to 2.5%.

But. At his last announcement Fed chair Jerome Powell talked about rates which were just below the Neutral rate. Markets seem to have taken this to mean that today's rate increase, if it happens, will bring it to neutral, so no more rate increase will be signalled into 2019. Add in the Donald's insistence that any rate hike now is insane, we wait to see if it actually happens.

Either way, US dollar traders are in for some excitement and that just might include the precious metals and stock markets.

The case for Gold

This time last year all eyes were on BitCoin and the other 1400 or so Crypto's. These were the new Gold the hype merchants told us. Yes, the similarities were there all right. Gold has rocketed higher several times in a buyers frenzy to get in on the act. What makes it move?

Read more...
 
What's the Yield Curve Invertion? Print
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What's meant by the Inverting Yield Curve?

 

The blogosphere is full of the impending collapse of the Dow with some pundits talking of 14,000 in 2019, a modest 10,000 points lower. Right or wrong, the fuel that has kept stock markets forever bubbling, an endless wall of money and a strong economy, will eventually end. Is the yield curve telling us the economy is about to fall of a cliff?

Normality

Government and corporate bonds are issued with different maturities. The standard US bond is the 30 year, but there are many different maturities, typically 3, 5 and 10 year, etc. Some run for just a few months to maturity, whilst some whacky corporate bonds have been issued with maturities way out at 100 years!

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The UK's Crown Jewel Print
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The UK's Crown Jewel

The Jewel in the UK's crown is, and has been for the last four+ decades, the City of London. City bankers and banking can do no wrong, as we discovered in 2007/8. Banking and finance delivering the largest tax yield of any sector of British industry.

The City of London is a dominant centre in world and European finance. If Europe really wanted to cause a problem for the UK leaving the club of 27, quashing a deal on financial cross border services is where they could do most damage.

Last Thursday a rumour gathered momentum.

Leaks dripped out from the 'secret' meetings with Brussels. The City could continue to operate as before across the Eurozone. It was later denied, of course, but the rumour was enough to collapse the EURGBP, reversing two weeks of Euro gains in just four days.

Last Thursday was the time to reverse the a-b-c trade and ride the EURGBP down for another 150+ pips.

 
Another 150 pips.... Print
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Another 150 pips - Was last Thursday the day we've been waiting for?

 

None of us need reminding of the relentless grind of Brexit headlines which have been battering the Pound and the EURGBP exchange rate over the last few months.

Traders also had other things on their minds, with the Euro tumbling through late September and October. It was those Italians in revolt who dared to ignore edicts from their European masters.

The headlines in September suggested a Brexit deal was no more than days away and the Pound gave us a tradable 180 pip run against the Euro in a fortnight. Everything looked rosy....

Then the carpet was tugged away by Barnier and crew. Theresa was sent away with nothing but a red face and more homework to do on the Irish border.

That set up the next move as the Euro ran up against the Pound in the opposite direction. An a-b-c move, good for another 150+ pips....

 
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From the blog

Ripple rips, founder now 5th richest man..

Ripple leads the charge, outstripping %age run of all the other crypto's on the back of Coinbase link, and the founder, Chris Larson?....

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