According to IG Client Sentiment (IGCS), retail investors continue to aggressively short US benchmark stock indices such as the Dow Jones and S&P 500. IGCS is usually a contrarian indicator, especially in a trending market. If traders continue selling into recent price action seen on Wall Street, then there may be room for further upside potential in equities. For a detailed analysis about how you can use IGCS in your own trading strategy, check out last week’s recording to my biweekly webinar about the tool.

The IGCS gauge implies that about 20% of retail investors are net-long the Dow Jones. Downside exposure has increased by 14.81% and 20.63% over a daily and weekly basis respectively. The fact that traders are net-short hints prices may continue rising. The combination of this and recent shifts in sentiment offers a stronger bullish contrarian trading bias.

Looking to develop your confidence in oil trading and using technical indicators? Our advanced trading guides cover more sophisticated techniques and new concepts to take your trading to the next level.

Looking to develop your confidence in oil trading and using technical indicators? Our advanced trading guides cover more sophisticated techniques and new concepts to take your trading to the next level.

Argentinian football superstar Lionel Messi is said to have received a ‘large number’ of PSG Fan Tokens in his recently announced free transfer to the French football giant, according to a range of recent media reports. The tokens, a digital asset for fans, ‘give you the power to influence decisions of your favourite teams, unlock VIP rewards and access to exclusive promotions, games, chat and a superfan recognition’ according to football fan token provider Socios.com. The PSG tokens can be traded on a number of cryptocurrency exchanges including Binance, Paribu, and Upbit.

The PSG tokens have jumped sharply over the last week as Messi’s transfer deal with the French football was concluded, rising from around $22 to a high yesterday of over $48. The market cap of these tokens is around $113 million – around the same amount that Messi is set to receive in wages over the next two years?? – while the fully diluted market cap is just under $780 million.

Chart via...

EUR/USD appears to be defending the March low (1.1704) as it halts an eight day losing streak, and the exchange rate may stage a larger recovery over the near-term as it tracks the range from the first half of the year.

The three-week rally in the cryptocurrency market continues unabated with Bitcoin up by over 50% from its recent multi-month lows while Ethereum is showing an 85% rise from its July 20 low print. While the market has taken on board the ongoing US cryptocurrency tax amendments in the US infrastructure bill, it seems as if the market is running along the lines of ‘what doesn’t kill you, makes you stronger’ and forging further ahead. As always the market is liable to turn sharply, but as we stand the charts remain pointing higher and the overall market sentiment is positive.

Bitcoin (BTC), Ethereum (ETH) Consolidating Recent Gains, Outlook Remains Positive

The alt-coin market is also driving higher with some coins registering 30%+ gains in the last week alone. Using 7-day data from CoinMarketCap, Cardano (ADA) is up 33%, Dogecoin (DOGE) is 36% higher, Uniswap (UNI) is showing gains in excess of 42%, while VeChain (VET) is up by 32%. It may be that we are seeing the...

US CPI Headline Matches Estimates, Core Figures Dip

DATA RECAP: The headline rate rose 0.5% on the month, matching expectations, which saw the yearly rate print 0.1ppts ahead of estimates at 5.4%. However, the core reading rose 0.3%, down from the 0.9% rise in the prior month and below the expected 0.4%, taking the y/y figure to 4.3% from 4.5%. Transitory factors that have been a focal point for much of the increase in inflation have begun to rollover as used cars saw a marginal rise of 0.2%. Elsewhere, more sticky measures such as shelter costs rose 0.4% from a 0.5% in June.

US Inflation Components

Source: BLS

How to Trade After a News Release

MARKET REACTION: In reaction to the CPI report, the USD initially came under pressure with USD bulls seemingly looking for an upward surprise. Similarly, US yields have also taken a hit with the 10 year falling 3bps, which in turn provided a slight reprieve for gold as the precious metal hit daily highs of...

Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Traders of all levels should have a solid grasp of what forex leverage is and how to use it responsibly. This article explains forex leverage in depth, including how it differs to leverage in stocks, and the importance of risk management.

Slippage can be a common occurrence in forex trading but is often misunderstood. Understanding how forex slippage occurs can enable a trader to minimize negative slippage, while potentially maximizing positive slippage. These concepts will be explored in this article to shed some light on the mechanics of slippage in forex, as well as how traders can mitigate its adverse effects.

Our DNA FX quiz can tell you what type of forex trader is buried within your DNA. Simply answer the 14 questions honestly to learn which style of forex trading you are best suited for.

If you’re new to forex trading the results will help you develop your trading style and strategies, but even established traders might discover something about themselves they weren’t aware of…

FOMO – Fear of Missing Out - is a relatively recent addition to the English language, but one that is intrinsic to our day-to-day lives. A true phenomenon of the modern digital age, FOMO affects 69% of millennials, but it can also have a significant bearing upon trading practices.

For instance, the feeling of missing out could lead to the entering of trades without enough thought, or to closing trades at inopportune moments because it’s what others seem to be doing. It can even cause traders to risk too much capital due to a lack of research, or the need to follow the herd. For some, the sense of FOMO created by seeing others succeed is only heightened by fast-paced markets and volatility; it feels like there is a lot to miss out on.

To help traders better understand the concept of FOMO in trading and why it happens, this article will identify potential triggers and how they can affect a day trader’s success. It will cover key examples and what a typical day...

Trading bias is a predisposition or perspective of the financial markets whereby traders believe there is a higher probability of a certain outcome as opposed to any other alternate possibilities.

These trading biases are determined by technical and/or fundamental factors that support a specific outlook that explains market behaviour. This often relates to market trends being either bullish/bearish which signals appropriate trading strategy and style.

Risk management is at the core of any good trading plan, without having a sound set of principles to follow a trader is doomed to fail. We outline rules and factors to consider when customizing a risk management game-plan right for you.

We understand the difficulties of trading, which is why we’ve put together a variety of guides designed to help traders of all experience levels.

Risk management is one of the most important aspects to successful trading, but far too often it’s overlooked. Job #1 for a trader is to always keep yourself in the game. A sound strategy and the discipline to follow it will go long way towards ensuring you stick around.

If you are in the learning stage, your objective is to keep losses very small until you figure out what you are doing from an analytical and strategy standpoint. Adhering to sound risk parameters early-on will go a long way towards building a foundation for later on.

For the more...

“Is there a best time frame to trade forex?” is a common question a lot of traders ask, especially those new to the forex market. The truth is, there is no single answer. It all depends on your preferred trading strategy and style.

Traders utilize varying time frames to speculate in the forex market. The two most common are long- and short-term-time frames which transmits through to trend and trigger charts. Trend charts refer to longer-term time frame charts that assist traders in recognizing the trend, whilst trigger chart pick out possible trade entry points. This article will explore these forex trading time frames in depth, whilst offering tips on which can best serve your trading goals.

Talking points:

Trading bias is a predisposition or perspective of the financial markets whereby traders believe there is a higher probability of a certain outcome as opposed to any other alternate possibilities.

These trading biases are determined by technical and/or fundamental factors that support a specific outlook that explains market behaviour. This often relates to market trends being either bullish/bearish which signals appropriate trading strategy and style.

Trading bias is a predisposition or perspective of the financial markets whereby traders believe there is a higher probability of a certain outcome as opposed to any other alternate possibilities.

These trading biases are determined by technical and/or fundamental factors that support a specific outlook that explains market behaviour. This often relates to market trends being either bullish/bearish which signals appropriate trading strategy and style.

Recessions can devastate the economy and disrupt the fortunes of individuals, businesses, and investors. But economic decline in the business cycle is inevitable, and your trading chops can be defined by how you respond to crisis. In this piece, we’ll address what a recession is, what causes it and how traders and investors can navigate turbulent times to emerge stronger for the upturn.

A recession is a period of reduced economic activity in the business cycle, representing contractions that can fall across a combination of GDP, retail sales, manufacturing, employment, and more. Usually, the term is applied when GDP sees two or more consecutive quarters of decline.

Recessions are inevitable in the business cycle, which moves in peaks and troughs. This means that, as sure as there is a bull run, there will be a correspondent downturn as economies fall from their peak.

Recessions can be caused by particular patterns across a range of...

Crude oil prices rose over 30 percent year-to-date as increased vaccination rates and reopening after pandemic-inspired lockdowns led traders to bet on a boom in economic activity. It seems only natural that the need for key growth inputs would rise in this scenario. Pent up demand for travel – both recreational and commercial – was a key drivers envisioned in this model.

Crude oil prices rising with inflation expectations as demand picks up

However, with a new strain of Covid-19 spreading throughout the world, a shadow of doubt is now being cast on future growth prospects and thereby on demand prospects for key raw materials, like oil. Rising tensions between the US and Iran may give the Brent crude benchmark some respite however. The multi-trillion dollar question is, will this be enough to reverse the macro trend?

The spread of the Delta variant poses the biggest fundamental risk to crude oil prices as the new and more contagious strain spreads across...

Mounting worries over the quickly spreading Delta Covid variant’s impact on the global economy solidified further this week after Goldman Sachs and JP Morgan Chase downgraded economic outlooks on China. Goldman sees third-quarter growth slowing to 2.3% from 5.8%. A rebound in the fourth quarter may transpire, however, but the full-year projection remains worse off as restrictions are seen hampering consumption in the Chinese economy. Nearly 100 locally sourced cases were reported on Monday, according to China’s National Health Commission.

The downbeat outlook weighed on crude oil and iron ore prices, two major commodities that are particularly insightful to gauge demand in the world’s second-largest economy. Crude oil fell nearly 2% on Monday, while the global benchmark, Brent, sank just over half a percent. Meanwhile, iron ore prices added to recent losses, extending the monthly drop to almost 10%. Iron ore prices are highly reliant on Chinese demand, given it is...

The Canadian Dollar may be vulnerable against the US Dollar after USD/CAD formed a ‘Golden Cross’ between the 50- and 100-day Simple Moving Averages (SMAs). The pair was initially on its way lower after establishing the 1.2748 – 1.2808 resistance zone, but support seemed to be established at 1.2423. Resuming June’s bottom could see the pair revisit the current 2021 peak at 1.2881. Otherwise, falling under the SMAs may open the door to aiming back at lows from earlier this year.