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Forex Videos

Trump Leaves Office! What Now For The Forex Space?

 


What to expect in the Forex space when Trump leaves office

Thank you for joining this Forex  Academy educational video.

In this session, we will be looking at the potential key moves in the forex space with Donald Trump leaves office in a few days’ time.

History will look back at Donald Trump’s presidency, and it looks like historians will likely give him a good kicking.

But, if we hark back 12 months, pre-pandemic, unemployment in the United States was at a record low, the gross domestic product was high, US stock markets were at all-time record highs: The United States economy had never been fitter, thanks to having him at the helm.

Donald Trump’s style of presidency will be seen as abrasive and belligerent. But we have to remember he was not a politician to start with. He was a tough businessman with a no-nonsense attitude, and that’s why people voted for him to become president in the first place. It was a poke in the eye for the political elite in an attempt to bring back wealth for ordinary people. It was his lowering of corporate taxation and red tape and policies to bring back manufacturing to the United States that lifted the US economy to retain its rank as the most powerful nation on the planet.

But, when push came to shove, Donald Trump fell on his own sword because of his mishandling of the coronavirus pandemic.  The bottom of his presidential world fell out because he buried his head in the sand and ignored all the warnings about the horrendous covid disease.  His lacklustre attitude, and slowness to respond to the crisis, created friction at every point between the democrats and republican parties instead of trying to pull both sides together for the sake of the nation, which did nothing to help while the economy as it  faltered with mass unemployment and the sharpest decrease in GDP in US history.

Financial traders won’t miss him; his use of Twitter affected the financial markets without warning, creating huge swings in stock indices, bond yields, and the forex space, only for him to reverse many of his Twitter comments later, creating more mayhem while commenting on highly sensitive foreign and economic policy decisions he planned to implement, while he fed such information into the market with no warning or embargo.  Many would say good riddance and be happy to get back to the old style of governance under a lifelong politician, Joe Biden.

Some analysts predict that President Trump will try and upset the apple cart before he leaves office, while the Democrats are threatening to impeach him and have him removed, the timing would suggest this is impossible with just 10 days until he leaves office, at the time of writing.  But it is said that fellow republicans are side-lining him with regard to policy decisions and are trying to keep him at arms-length until he has gone. 

Throw into the mix US stock markets at record highs, due to what they currently see as the new president having more clout due to the democratic party holding more power in Congress after the recent runoffs in Georgia, to be able to bring in more covid stimulus aid packages and roll out vaccines across the United States.

Certainly, the dollar index – seen here – seems to be trying to fight back to the 91.00 level at the time of writing, having almost hit 88.00 in the last few days at position B, having fallen from its high in march at position A of 103.00.  does this mean that the rot has stopped?  Possibly not, but with a president on the way out and a new one on the way in, we can certainly expect the unexpected.  

This might mean that the Eurodollar pair, which has been riding high, will take a breather, having found resistance at 1.2330, shown here on this daily chart at position A

And with cable failing to reach the key 1.3700 on this daily chart at position A,  this might also be a reason why the markets are taking a breather from shorting the US dollar.

In conclusion, expect the unexpected, expect volatility, and expect the fundamentals to take a side-line while the US transition between presidents is over and new policies are implemented by the incoming democratic party.

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Forex Videos

How Forex traders factor in President Trump – The Enemy Of Predictability!

How do traders factor in President Trump?

 

Thank you for joining this forex academy educational video.
In this session, we will be looking at how President Donald Trump affects the financial markets and what precautions traders have to take since he came to power.
First of all, we need to remind ourselves that President Trump has never been a politician, he has never been a diplomat, and some members of the democratic party in the United States, and a lot of other people besides, might argue that he doesn’t have a diplomatic bone in his body.
President Trump inherited a fortune from his late father and made himself a name in reality TV. He has brought a certain element of reality TV to his presidency. Often his style is considered to be chaotic, argumentative, belligerent. He has been accused of lying, and the democratic party tried to have him impeached halfway through his presidency.

Certainly, there seems to be a great deal of animosity between himself and the speaker of the House, Nancy Pelosi, who, not happy with losing the opportunity to have him impeached halfway through his term in office, is now working to have him removed from office over concerns about his inability to run the office. Where, under the 25th Amendment, should she succeed, vice president Pence would take over.

This will only serve to cause more friction between the pair. And when Donald Trump’s cage is rattled, he tends to be reactive, which may be causing the delay to the proposed stimulus bill. The longer is stalled, the more it will adversely affect Americans and American companies. The current impasse between the republicans and the democrats is the difference between 1 trillion or 2 trillion dollars. Surely it would make sense to at least start with the smaller of the two amounts and build from there, rather than make people suffer.
And one has to ask if this is a personal vendetta because it certainly seems to be a power struggle. And of course, this is all a part of Donald trump’s leadership style: one day he says there will be a stimulus bill, the next day he says there will not be a stimulus bill until the US Presidential election is over. This, of course, affects the United States stock markets. The knock-on effect is felt by other global markets and numerous assets, including treasuries, bonds, and of course, it is also affecting the United States dollar and every currency traded against the dollar.

But singularly, the most disruptive way that Trump affects the financial markets is his use of Twitter. With a single tweet, Donald Trump can move markets dramatically, where in years past, high-level economic data releases have been subject to an embargo. President Trump will simply issue a tweet at any time he sees fit, the consequences of which can cause the financial markets to suffer extreme volatility, with some traders benefiting and, of course, many others losing money because of this style alone.
And so, if you are relatively new to trading, we suggest you add President Trump to your Twitter feed to keep abreast of his tweets, or better still, only trade when he is in bed asleep. Remember to expect the unexpected from him.

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Forex Market Analysis Forex Videos

Forex & The US Presidential Election – How To Trade Biden VS Trump!

The US Presidential Election – what to expect from the Forex space?

Thank you for joining this Forex academy educational video. In this session, we will be looking at the upcoming US Presidential Election and what could happen in the Forex space in the run up to it and after the winner is announced.

It is a time of uncertainty in the global financial markets, with many Western countries seeing a second wave of the coronavirus, with massive unemployment and peaks and troughs in global gross domestic product, where no sooner can an economy begin to get back on its feet than a second lockdown offers the prospect of greater unemployment, more economic uncertainty and whereby governments are required to bail out their citizens and businesses with vast amounts of quantitative easing, which will see huge debt burdens emerge for generations to come.
Add to this the most contentious US presidential election ever, and it can only mean one thing: uncertainty. And traders and investors, including institutions, do not like uncertainty. It means that they have to diversify their portfolios in order to mitigate against risk.

The basic premise is that should Donald Trump managed to secure a second term in office, he has pledged to continue with the corporate reforms, and he has promised and to continue easing taxes. Whereas Joe Biden has promised to raise corporate taxes, and where he will undoubtedly increase liability on corporations with regard to further reforms and red tape, which has the effect of strangling the performance of the business. Not what you need in times like these.

Before the pandemic took hold in the United States, President Donald Trump was riding high with record-breaking high levels of employment, and record-breaking values in stock markets, largely because of his tax and corporate red tape roll backs and reforms. The investors loved him. He was undoubtedly one of the most successful presidents of all times in terms of the economic performance of the USA.

Fast forward a few months, and he could potentially go down as one of the worst presidents, and this has largely been down to what has been termed by many journalists, economists, and analysts, as well as great swathes of the population in the United States, has having lost grip of the pandemic to the point that he wilfully ignored the damage that it could do in terms of health to its citizens and to the health of the economy.

The polls suggest that he will pay the price and lose the election to Joe Biden.

And because we may see higher taxation and a rollback of reformed policies should Joe Biden become the next president of the United States, this is why we are seeing a pull-back in the US equities markets, and here we can see that the Dow Jones industrial average of the 30 leading companies had made incredible rebounds from the lows of middle of March when the pandemic really hit America hard, add where we almost saw a 100% rebound of the record-breaking high from February of over 29,000 for the index, on the basis that the market believed that the US federal reserve bank was handling the coronavirus well in terms of its interest rate policy and the amount of stimulus being offered by the government and hopes that a vaccine would quickly help the US to recover to pre-crisis levels and beyond.

In this yearly US dollar index chart, which measures the value of the US dollar against the most other widely traded currencies, the so-called majors, including the yen, euro, pound, Swiss franc, and Australian and New Zealand dollars, we can see that it found support at 92.00 in September, after heavily losing out against the majors, and more recently found support at 93.00 before pushing above 94.00. This is what we might expect as the US dollar has often been bought as a safe haven asset in uncertain times, and while the markets try to determine the amount of risk of the unknown, which is what would happen if Joe Biden and the Democrats took power. The dollar is also being bought and stocks sold because the democrats and republicans have not yet been able to reach an agreement on a much-needed extension to the financial stimulus aid package to help keep American firms and the public afloat.
Therefore, no stimulus deal could possibly now be agreed until after the elections, which will lead to more uncertainly, therefore more of the same for stocks and the dollar.
But if Donald Trump is elected for a second term, stocks should rally, and this might have the effect of a stronger US dollar and softer counter currencies, including the majors, perhaps with the exception of the British pound, but only in the event that the UK and EU manage to secure a free trade deal, and also perhaps with the exception to the New Zealand dollar, which is currently being very resilient to the recent upswing in the US dollar.
But if Joe Biden takes power, we would highly likely see extreme market volatility in all financial assets and where the fear of the unknown would offer no real directional bias for the markets in the short term. We also should look at the possibility that even if Biden swept to power, the markets might believe that he could handle the pandemic better than Trump, be less provocative to foreign powers – which could help investment in the USA – and this might also bring back investors into the equities space as a direct result. With the democrats then holding all the aces in Congress, a stimulus deal would be more likely to get through more quickly, and more stimulus should, theoretically, mean a softer US dollar, in which case traders will be looking for opportunities to short it against the majors in particular.
One thing is for certain; the markets are in for a bumpy ride. Traders, be warned.

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Forex Videos

Donald Trump v Covid 19 – Forex Trading Tips!

 

Donald Trump v Covid-19, the fight is on, but how will the markets fare?

All the world’s a stage, wrote William Shakespeare in his comedy; As you like it. And one thing is true. The Donald Trump presidency has been theatre, the like of which we have never seen in politics in the western world. Let’s go back to December 2019; the US economy was buoyant with record employment, record stock market highs, and the US was a few weeks short of signing a massive phase one trade deal with China. Donald Trump was on the cusp of going down as the greatest American President ever, in terms of steering the US to economic glory.
Step forward a few months, and the global Covid-19 pandemic has all but reversed the economic fortunes for the US with massive unemployment, an economy in freefall, instability, and with the presidential elections just a month away, at the time of writing. Donald Trump and his management of the Covid crisis in the US now looks likely to leave a legacy of being one of the worst US presidents ever.


Love him or loathe him, President Trump has been a major critic of the Chinese government, who he blames for what he calls the China virus. He has spewed out vitriol against them in many statements, and this has led to threats of tariffs, sanctions, bans on Chinese companies operating in the US such as tik-tok, WeChat, Huawei for so-called security reasons, and now that he has had a taste of the virus himself, one can only imagine how things might be escalated from here, when and if he recovers.
Many would argue that Donald Trump testing positive for Covid is poetic justice for a man who consistently played down the seriousness of the disease, while criticising people such as his presidential opponent, Joe Biden, for wearing a mask, when he himself often refused to do so. In fact, it was likely that a recent event in the White House Rose Garden, regarding the nominee for the vacant supreme court judge, was very likely a super spreading Covid event, where many members of the Republican team are dropping like flies, as one by one, as they test positive for Covid.
People will say that Donald Trump had it coming, and it was only a matter of time and wonder how on earth the most secure building on earth, the White House, with all of its technology, and private hospital wing, could allow the President and so many of his aides and colleagues to become infected. This was probably down to sheer bloody mindedness by Donald Trump, who just didn’t take the disease seriously enough.


And getting back to the important presidential election on the 3rd of November, everything is now up in the air, with a quarantine of 10 days and a period of convalescence required, should President Trump shake off the disease, bearing in mind he is 74 and overweight and has a gruelling schedule that many much younger men would not be able to cope, with is it likely that he will be fit enough, should he recover, continue with the election campaign?


The financial markets will see great uncertainty regarding the prospect of President Trump returning for a second term to the White House. There are constitutional issues with regard to voting, which is already going on, with many ballot papers already having been returned, and if Donald Trump is not able to stand, questions remain about how that might affect votes for the second in command, Mike Pence. And with Joe Biden leading in the polls, institutional investors will be worried about extra regulations and higher taxes, should he win the presidential election. And with all this uncertainty, we can expect a great amount of volatility in the markets where institutions will be recalibrating their portfolios and where a risk-off event will take place, with stock markets edging lower, if not falling, and a great deal of volatility in the currency space, which might see a dollar resurgence. Because this event is unprecedented, it is really hard to call. But one thing is for sure; we will see extra volatility.

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Forex Market Analysis

How Elliott Wave View of NASDAQ Anticipates Trump’s Coronavirus Outcome

Overview

The NASDAQ 100 Index fell 2.2 percent on Friday’s trading session on the news of the US President Donald Trump’s positive coronavirus test. Still, the price action unveiled the wave B completion, suggests further declines for the US technologic benchmark in the following trading sessions.

Market Sentiment Overview

During the last trading week, the NASDAQ 100 volatility has been driven by market participants’ expectations facing the first presidential debate between US President Donald Trump and former Vice President Joe Biden.

The advance experienced by the technology index was boosted by the expectation of new economic stimulus, driving the NASDAQ 100 to raise over 4%. However, its gains were lowered after the announcement of President Trump’s positive Coronavirus test, leading it to ease up to 2.74% on Friday’s trading session.

The following 8-hour chart of NASDAQ 100 reflects the 90 days high and low range. In the figure, we distinguish that the price halted its advance towards the extreme bullish sentiment zone, closing the trading week in the bullish market sentiment area and under the weighted 200-day moving average. This market context leads us to weight a neutral market sentiment.

On the other hand, the 12-hour chart corresponding to the NASDAQ 100 Volatility Index shows the 90 days high and low range where we distinguish a sideways movement consolidating above the 200-period weighted moving average. This volatility context of the NASDAQ 100 index, added to the new test of the upper-line of the consolidation structure, leads us to expect an increase in volatility within the coming trading sessions.

Summarizing, NASDAQ 100’s market sentiment unveils that this index and its volatility figures will be driven by the news on the upcoming presidential elections on Tuesday, November 03. In particular, NASDAQ 100 could turn bearish in the following trading sessions.

Elliott Wave Outlook

The overview of NASDAQ 100 shows the full development of a five-wave bullish sequence, which began on June 15, when the price found fresh buyers at 9,383.6 pts pushing the price towards new record highs September 02 at 12,466.6 pts. Once reached the all-time high, the technological index began to perform a bearish corrective movement, which remains in progress.

The following chart shows the NASDAQ 100 in its 4-hour timeframe, where we distinguish that the price has completed a five-wave impulsive structure of Minor degree labeled green. At the same time, we can confirm that the Elliott wave theory rule, stating that there must be only one extended wave. In this case, the NASDAQ 100 index developed a fifth extended wave that ended on September 02 when the price found resistance at 12,466.6 pts. Once the fifth wave of Minor degree concluded, the NASDAQ 100 began performing a corrective sequence, which remains in progress.

In particular, the completion of the wave ((c)) of Minute degree identified in black, which completed the wave B of Minor degree, coincided with the news media release concerning the US President Trump’s positive test, activating the beginning of the wave C, labeled in green.

The following hourly chart of NASDAQ 100 illustrates the first bearish movement’s internal structure corresponding to its wave (i) of the Minuette degree identified in blue. This first downward wave reveals a drop in five moves of Subminuette degree identified in green in its internal formation. Once this second move has been completed, the technological benchmark should resume its declines.

Finally, considering that wave (i) of Minuette degree completed its descending move at 11,220.8 pts on Friday 02nd, the price could retrace, forming its second wave of the same degree. In terms of the Dow Theory, this retrace could be between 33% and 66%, or between the 11,352.3 pts and 11,483.7 pts, where NASDAQ 100 might start to develop a new decline, corresponding to wave (iii) in blue.

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Forex Videos

Donald Trump Ramps up the heat with China! Forex Traders Beware!

 

Donald Trump Ramps up the heat with China

 

Thank you for joining this Forex Academy educational video. In this session, we will be looking at for little events surrounding the ratcheting up of tensions between the United States and China.


In the ratcheting up of the tensions between the United States and China, Donald Trump sites the risk of companies such as Huawei and now TiK ToK and we-chat, which are viewed as major security risks, because the American government believes that Chinese tech firms will have back door access to United States data, including access to the American population’s personal data where they use such technology.
Donald Trump has now signed an executive order banning the use of TikTok, a sort video platform owned by Bytedance Ltd., and WeChat, which is a messenger app owned by Tencent Holdings. The order will come into effect within 6-weeks of the time of writing this article. This is almost unprecedented where such apps could be banned from use to millions of us citizens. United States citizens and American companies will be banned from doing business with either of these two firms.

In a twist, TikTok, which has global downloads predicted at 2 billion + with a valuation of 100 billion US dollars, may find a reprieve in the United States if Microsoft can secure a license to run the application in the United States, Canada, Australia, and New Zealand and where such a license may cost Microsoft between 20 and 50 billion US dollars. The idea being that Microsoft would be the only company to collate user information, stating that this would be safe Microsoft and not passed onto the Chinese government.

Tiktok, which was seen until fairly recently as a harmless video for children, has been embraced by celebrities and influencers, which has helped it attain exponential growth within the United States. However, US national security concerns that its parent company will share valuable information with the Chinese government, and the same can be said for WeChat.
While the digital market remains open in most western countries, including the United States, where are companies such as Facebook and Amazon and Google operate with few restrictions, China has blocked several US internet companies, including Google, from operating in its country.

And while Tencent lost billions as the WeChat ban hit Chinese stocks and caused the Chinese Yuan to depreciate, the fallouts could hit United States tech stocks as markets try to calculate how American tech companies and other firms in the United States are affected because some of them rely on these apps for their businesses.
The Chinese foreign ministry reacted to Donald trump’s ban by saying that America is using national security as an excuse and using state power to oppress non-American businesses.


One thing is for sure, the escalation between these two Nations can only get worse before it gets better. Traders should be looking for dips in US tech stocks and tech indices, and perhaps broad-based volatility with the United States dollar and related major currency pairs as further sanctions, bans, and potential tariffs are introduced by both sides as matters worsen.

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Forex Videos

Buying Rumour & Selling Fact – The Trump Card – Is Donald Trump Manipulating The Forex Market?

Buying Rumour & Selling Fact – Forex Fundamental Secrets

When it comes to trading the markets, there are three main tools that traders use to in order to try and gauge direction within the financial markets: fundamental and technical analysis, and trading based on sentiment. Within the scope of fundamental analysis lies a critical area based on market rumors, which are rife in all the various sectors that make up the financial markets.

Buy the rumor, sell the fact is something you may have heard of, but in any case, rumors tend to abound in all of the financial markets and these often present opportunities to buy and sell or hold assets. The saying, buy the rumor and selling news first entered the financial markets when traders picked up on chatter or news reports in the equity market that a company was doing better than expected and that this would be reflected during the earnings announcement season. This could lead to a better share price for the company and also better dividends. And therefore, this would lead traders to believe that the stock was undervalued and result in speculative buying of the stock, hence pushing up its share price. Speculative buying also results when rumors are going around that a company was about to merge or be taken over.
Another area in the equities market that is affected by rumors or hearsay is mergers and acquisitions. Sometimes CEO’s of companies will not make this type of information readily available to the marketplace during the negotiation stage, However, a secret meeting between the two heads of firm’s could be exposed by the media, and whereby investors speculate that a merger or takeover is imminent and this could cause a flurry of buying or selling of stocks in the two companies. But this could also cause selling in other companies – in the same sector – which might suffer because of a perceived diminished market share, in the event of such a merger or takeover.

On the flip side, rumors might surface that the company is not performing well, and this might lead to a sell-off. Therefore our adage of buy the rumor sell the fact can also mean the opposite, depending on the magnitude of the rumor, and especially if it subsequently turns out to be false, and which can cause extreme market volatility.
Buy the rumor and sell the fact works differently in the Forex space because obviously, we do not have mergers or acquisitions. However, analysts will speculate that governments are intending on raising or lowering interest rates. Traders might then take the analysts’ comments on board and start trading a particular currency pair in favor of the analysts’ report, which is just another way of saying rumor.

In recent years and especially with the advent of Twitter, the Forex market has become much more susceptible to buy the rumor sell the fact. This is partly due to the fact that news reporters are often well placed with governments’ lawmakers to obtain unofficial – as yet unreleased – information that could affect the economy of a particular country, and thus the value of its exchange rate.

Another area that has had a dramatic effect within the Forex market is the style of the presidency pertaining to the United States of America. President Donald Trump has his own unique style of governing. He regularly tweets on such things as his preference for low-interest rates in the United States. This type of comment often flies in the face of the Federal Reserve, and it is not uncommon for him to tweet on factors pertaining to the economy, such as imminent economic data releases, even occasionally tweeting in a somewhat biased manner about highly sensitive and anticipated non-farm employment results, which are of course subject to an embargo.
One of the biggest problems that retail traders face, within the Forest market, is that price action, while driven by rumor, is reliant on market perception of the reality of the anticipated news release. At this point, the markets might think that the current exchange rate warrants such levels, or perhaps that there has been an overall exaggeration at which point a sharp reversal in price action might occur. Another danger is that traders who have ignored price action based on rumor, then enter the market expecting a continuation in trend, only to be thwarted by a reversal due to traders who got in during the early stages of the rumor then deciding to take their profits and causing a potential reversal or consolidation.

As well as rumors in the financial markets, another all too common a feature nowadays is fake news. It is not unheard of for fake Twitter accounts to be opened purporting to relevant players, such as respected analysts and reporters, and whereby fake news is released into the market which can greatly affect price action having been inadvertently being picked up in good faith by major news channels and filtering its way into to the market. While this type of fake news is generally quickly shot down in flames, that is not to say that it has not already caused extreme volatility in the process.
That is why here at Forex.Academy, we recommend that traders be mindful of rumor and speculation in the Forex market and trade with the necessary caution at such times. Always be prepared and expect the unexpected!