THE NAIVE TRADER

As stated in the previous article, there are quite a few data releases this week(exciting I know), with all bar two coming from the US. Wednesday is showing a busy afternoon for the releases of US data. Firstly the ADP Non-Farm Employment change which is showing a very strong figure, of 191k, well above last month. I have decided to pick this out as it could lead to a further strong rally of the dollar on Wednesday, because there are other very positive data releases all in the afternoon. Next we have the Manufacturing PMI, this is showing a forecast the same as last month and its not the important so I am going to move over it, but I shall see pay attention when its released. Only 15 minutes after this, the ISM Manufacturing PMI is released which is showing growth but it is below last months result of 60.8 at 59.4. This isn't a huge change, and because its still above the base index value of 50 its showing growth, which is good for an economy and a currency. At the same time a...

I said I would update on Golds position on Friday evening in my last post and there was indeed some strong change. Gold closed on Friday at 1273 per ounce against the dollar, moving almost $10 in the space of the afternoon and evening. This was a very strong rally considering there was no data release causing such a movement. But I released today after further reading that the 'Catalan Independence Movement'  issue in Spain caused much uncertainly in the forex market thus pushing investors into the save haven which is always considered to be Gold. This movement meant the bear trend holding for the majority of the week was basically destroyed in a matter of hours. I was very naive to this as the Spanish economy is big but only the 14th biggest economy my GDP size so I didn't believe this political shift would lead to such a strong consistent rally in a fairly short period of time. Anyway, that concludes the position of Gold for the week, now to the week ahead: In the art...

This week, well it has been extremely strong for the Dollar, continuing to perform strongly in the Cable market. Pushing the pound lower and lower on Thursday and Friday after a nice rally during Wednesday. Tuesday's focus was just the Australian CPI q/q. Which came out below forecast at 0.6%. This didn't do huge damage because the forecast was already much higher than the previous quarter, the AUD/USD fell from 0.7830-0.7820 before continuing to decline down to a low this week of 0.76235 on Friday. Wednesday morning, the UK released their Prelim GDP for the quarter, with the result being above forecast by 0.1% at 0.4%(Forex Factory, 2017). The implications of this were small against the dollar but later in the day the pound did experience a very impressive but short rally in the cable market, hitting a high of just above 1.326 before plateauing and continuing on the bear trend which it has been experiencing for quite some time now. In the mid afternoon of Wednesday the ...

There was meant to be nothing exciting or of huge consequence hitting the gold market till Wednesday, yes Gold is now back on its bearish trend but Monday caused quite some stress. I was just living my life as always and then all of a sudden the Gold position got absolutely fucked, like booooooom. Before I could react Gold jumped from 1274 - 1281 against the dollar. I was so confused, like what had happened. Did Mr Trump declare war, did the US dollar just hit new highs for no reason. But I honestly don't know exactly why, as I spend more times reading the markets I will be able to obtain greater knowledge of why this shift took place. I originally thought it was the release of the CBI Industrial Order Expectations from the UK, as the result was -2 below the index and -11 away from the forecast. However this makes no sense, as it would lead to the pound dipping further against the dollar thus leading to the dollar gaining even greater value. This would lead to a dip in Gold valu...

No, once again nothing is really coming up till Wednesday(that I really care about). But this week I have decided to include the AUD as their CPI q/q comes out Wednesday and boy is there some movement. The forecast expecting a result of 0.8% compared to last quarter which recorded a result of 0.2%(Forex Factory, 2017). The last week has seen a fairly constant dip of the currently against the US dollar, currently sitting at 0.781 against the dollar. The data release offers some hope to this falling position, as a strong result either on target or above could help the AUD end the week in a strong position against other major currencies. However I believe the main issue is out of the hands of the AUD because the dollar has been hitting new heights against many other majors within in the market. Hitting a high of 114.085 against the JPY and 0.98770 against the Swiss Franc. This makes me believe that even with a strong result it may not cause a long-term trend against the dollar because th...

The week we have just witnessed has been very interesting. Many outcomes as always continued to surprise me, I have heard the chat about the continued rise in bitcoin, hitting unprecedented levels of over $6000 yesterday. But because of this it means many other interesting movements have taken place throughout the week in over hugely volatile markets such as Crude oil. On Wednesday US crude oil inventories were released, with actual being a million more decline than expected. With actual being -5.7m compared to the -4.7m that was expected. This as you would expect should  case a huge upshift in crude oil prices, but no, this decline was met with decline in price, falling from just over $52.2 a barrel down to $51.6m minutes later which is hugely confusing. Why does the decline in production lead to this, I really don't know, but if anyone were to have a greater understanding I would welcome it. Wednesday indeed was a busy day, with further data coming from the US and UK. Building...

Data releases on Wednesday and Thursday this week are offering interest in the direction of the US dollar as well as Crude Oil prices.  On Wednesday the US release the monthly Building Permits results, forecast is looking at 1.25m down from 1.27m the month before(Forex Factory, 2017). Long-term we are seeing an upward trend after the low in April of this year, but what shall be interesting is how badly the Hurricane's of last month such as Harvey and Maria will damage this, will it allow for more building permits than expected to allow for faster re-building of the damage that has been done. I don't have enough trading experience to understand or know the wide effect of this if forecast, I just know if met or exceeded it will lead to an up-shift of the US dollar against the Pound and Euro.   But later in the day Crude Oil Inventories are released, we have been seeing a constant decline in production, last month there was a -2.7m decline in production but forecast is es...

Another week does begin and with that comes events which shall impact the markets as always. Sadly this week once again , there is nothing till Thursday which is going to significantly effect the current bullish Gold market. Gold of now is smashing it, continuing to rally. I feel this ongoing North Korean Issue with Mr Trump himself means the bull market could continue for a while because its creating huge instability about whether there will be another war or a new peace declaration. Who knows. So once again, because of this, I have picked up and shall highlight some of the key interesting events in this week to come. In a previous blog I have already spoken about today. with New Zealand releasing their quarterly CPI results. There is a surprisingly big change, forecast of a 0.4% change and increase, but for my interests I won't be looking at this, but as always, potential for decent money if you correctly pick the direction. But moving on, Tuesday is offering something of mild ...

Last week has been disastrous, in terms for what I predicted against what actually happened. Gold just continued ins upwards trend. Currently sitting at 1303 against the pound this weekend, looking at a bullish trend with nothing particularly influenctial happening this coming week, starting the 16th October. As written in the title, I believe I completely misread the situation, As I thought what had happened the previous would strongly effect the direction of Gold. As the non-farm unemployment results came out better than expected 2 weeks ago I thought this would mean unemployment would be lower than expected, which I was correct about but I presumed this would mean CPI would be way higher than what was stated on the forecast and that is where I fucked up. The results on Friday 13th were all below the forecast rate. But I thought that the previous day and the US no-farm data would act as a causation but maybe there was a correlation that wasn't directly linked. Therefore in rega...

Yesterday (Tuesday 10th) the UK released their monthly manufacturing results, and oh boy was I wrong, I disregarded simple economic theory as I didn't believe the lower pound would have so much impact on  the current manufacturing data. The forecast was correct and I was wrong, but the actual was strongly above the forecast, over 0.2% above what was expected. Thus clearly highlighting just how effective the lower exchange rate has been in influencing the manufacturing growth. I focused on market confidence in making my own predictions, as I thought markets just relied on stability to decide other outside factors. Yet I was wrong as the manufacturing sector is physical not just a graph on a computer and therefore no surprise manufacturing was up m/m , cheaper exchange rate=cheaper goods for overseas countries. This led to the pound rallying quite strongly yesterday, hitting 1.31 against the dollar, the opposite of what I predicted. But as always its very interesting to see what ha...

Currently I sit going through what I believe will be the biggest influences to gold this week, nar I am kiding, I have been looking at Forex Factory and seeing what is outlined as red. Anyway, after looking through this, it would seem the largest and potentially most damaging factors to the direction of gold are occurring Wednesday onward. Bit boring to wait till Wednesday so decided I would look at what the Manufacturing Production m/m change for Britain will effect the pound. The forecast estimates a decline, moving down to 0.3% from 0.5% last month. I personally don't believe this, the UK currency has been completely fucked by the constant fluctuating exchange rate against the dollar and euro respectively.  Being an Economist and using what I am taught in university this should mean exports will increase as weaker exchange rates mean UK goods are cheaper for buyers abroad. Yet the one thing markets hate is instability regardless how promising the decline looks for buyers. This...

After coming back and seeing what happens I was correct or maybe just completely lucky, who knows. Gold declined, further than I expected, falling to 1261 minutes after the announcement  of unemployment falling further than the forecast, with the unemployment rate standing at 4.2%, 0.2% less than expected. Thus therefore causing the dollar to rise and gold to fall, if you caught it at the right time decent margins could of been made. There doesn't seem to be much else of interest today, so on Monday we shall see what the week ahead shall hold. I have decided to reduce my commodity section, I feel Brent and Gold are sufficient, Silver is in my opinion much harder to understand, yet it does run somewhat parallel to gold, experiencing a similar decline after the unemployment rate was released. So it could be argued to just replicate all movement which I do in Gold but I don't find this of interest so I will stick to just the two for the moment.

Today, Friday, I thought would be perfect to start a blog following a fairly naive optimistic young trader. I believe its best to focus on a few stocks/commodities etc, whatever you believe is most interesting. Personally I stick to commodities, as I find it the most engaging, specifically; Gold, Silver and Brent. All volatile items which from an Economists point of view are fairly easy to follow. This afternoon, at 1:30pm GMT as I presume you know, the Non-Farm employment change and the unemployment rate of the US is released. I would argue there will continue to be a downward trend in unemployment. However forecast is only matching the previous Month of 4.4% (Forex Factory, 2017). But I see reason for there to be potential here for greater decline than expected. Trumps whole slogan of 'Make America great again' is pushing for greater investment within the US. While the effect is huge its effecting confidence. And confidence is really all the markets rely on to fluctuate. So...