USD, ECB’s QE Light & Gold

Risk aversion is dominating trading this morning following weak employment data last Thursday. USD is higher against the major crosses except JPY. The metals have also been hit. USD has a bit more strength left in it and metals can go a bit lower. However, in broad terms, USD strength and weakness in the metals is approaching overdone near term and should return to uptrend into the end of summer. I would expect to see more major problems with the economy emerge end of summer, into fall.

Read more

Profiting With Patience

“Patience is a virtue.” It is possible that this is most true when it comes to trading. Again our psychology and social influences are against us when it comes to this aspect of trading. We live in a time of instant gratification where our A.D.D. goes unnoticed because all of our automatic updating social networking sites always have a way to keep our interest.

Read more

Gold vs. Silver: The Ultimate Showdown

This week I will take a look at the differences between gold and silver and why someone would chose one or the other as an investment or trading vehicle. First some charts. In the first chart, gold and silver are indexed to illustrate percentage change and the gold/silver ratio to show relative changes. The next chart is a simple scatter plot to show the relatively linear relationship between gold and silver. I also included two charts at the end to give an idea of relative performance of gold, silver, copper and platinum.

Read more

NewB Trader Report #3

Hello to all the financial rockstars out there & welcome to the third instalment of the Newb Trader Report. It is Canada Day, so I am enjoying an unusual Wednesday holiday. I must say, I’m a bit jealous of the Americans getting Friday off. Nonetheless, this report doesn’t take the week off (what dedication!).

Read more

Quantifying Risk: Choosing Entry and Exit Points

I remember when I first started trading I thought, “well I’ll just buy this hot stock and hope it keeps going up!” I had no trading plan or any real reference point of where I should actually enter or exit a trade.

Read more

Platinum Research Note

 Many people are familiar with platinum because of its use in jewelry. While the jewelry market (particularly the Chinese market) is a significant element of demand, factors affecting industrial demand, primarily the automotive sector are more important.

Platinum is part of what is called the Platinum Group Metals (PGM). The other members of the PGM are palladium, rhodium, iridium and ruthenium. Platinum is most widely used and traded followed closely by palladium. For our purposes, the rest of the PGM are not important.

Read more

The NewB Trader Report #2

Hello to all the financial rockstars out there & welcome to the second instalment of the NewB Trader Report. If you missed last week’s article, I talked about the importance of due diligence & market psychology. This week I am going to continue laying the macro structure of trading by talking about the different styles of investing and a platform to get you started (paper trading of course!).

Complementing Fundamental & Technical Analysis

Read more

Speaking Greek: Be Aware of Vega

In a Bull market everyone is a genius. When I first started trading I fancied myself a genius because I doubled my account in 3 months trading options. Sounds great right? No. Actually, my initial success hindered my learning because I was taking huge risks with no discipline or plan and things worked out because I was going with the trend and picking momentum stocks like Apple. What happened once the Bull market came to an end in 2007? You guessed it, I gave it all up and more thinking it would turn around “eventually” and even doubling down in some cases.

Read more

The Commodity Majors USD/CAD & AUD/USD

Last week’s piece on copper shed some light on copper and other commodities’ relationship with USD so a natural extension is to turn to the major commodity currencies, the Australian and Canadian Dollars.

Read more

Eyeing the FOMC

It’s Saturday afternoon I’m here contemplating what has developed last week and looking to the FOMC meeting next Wednesday.

Monday, the selloff in equities, gold, and strength in USD that began the previous Friday, continued. There was a bounce Wednesday in non-USD currencies, gold, and to some extent, equities. But Thursday, Treasuries, and gold were hit after supply for next week’s 2, 5 and 7-year auctions were increased. The short end of the yield curve sold off, pushing USD higher against most majors, with the exception of the AUD.

Read more