Market analysis and insights on Forex & Commodities!

The Brexit Debate – What are the Possible Outcomes?

The ongoing Brexit Debate has been keeping markets around the world jittery for the past few days, especially the Pound (GBP), which has been declining sharply for the past 2 weeks.

The date that everyone is looking out for is 23 June, where the referendum will take place, with the big question, “Should the United Kingdom remain a member of the European Union or leave the European Union?”

Prime Minister David Cameron wants Britain to stay in the EU. US president Barack Obama also wants Britain to remain in the EU, as do other EU nations such as France and Germany. But according to polls, the British public seems pretty evenly split on the issue.

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From what I see, the Brexit (Britain + Exit) is a unique situation that could develop into one of three paths.

PATH 1: TOTAL INDEPENDENCE (UNITED STATES MODEL)

One possible arrangement is for Britain to be completely independent of the EU. This would make Britain as “separate” as the United States. Among the chief concerns would be the hefty protectionist taxes levied on U.S exports. It is widely-known that American cars are more expensive in Europe than those sold in America. Some dooms-day economists claim that this could lead to disaster for Britain’s already negative trade balance.

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Source: tradingeconomics.com

If you follow this line of reasoning you might expect the pound to become like the current depreciated USD. A country cannot have sustained deficits without experiencing a sharp fall in its currency value in the long run.

PATH 2: PARTIAL INDEPENDENCE (NORWEGIAN MODEL)

Another possibility is for Britain to leave the EU but remain in the EEA (European Economic Area). David Cameron seems to be very pessimistic about the Brexit, citing concerns of pensions, the healthcare budget, and the defense budget; which he feels would all be adversely affected. This option is a compromise between the two extremes, and it is called the Norwegian model.

In return for access to the EEA, Britain will then have to comply with the EU’s law relating to the internal market. However, Britain will not have a say on the rules that are made in the EU.

PATH 3: NEGOTIATE A TRADE DEAL (HIGHLY UNLIKELY)

Britain can negotiate for a trade deal that would allow certain goods to be exported freely to the EU. However, this is highly unlikely to happen as the EU would also demand for the labor market to be opened up (to immigrants and asylum seekers), which is clearly something the Brit voters do not want.

 

gbpusdDaily Chart of GBP/USD

HOW TO TACKLE THE MARKET?

As with most unique news events, the markets will start trending based on anticipated outcomes, and remain inactive as traders start to close out their positions to stay on the sidelines. Many brokers have increased the margin requirements in anticipation of a huge move.

For me, I personally do not like to trade on such news, as there will be huge spreads and slippage when the market is moving too fast. Hence, I will likely scale out of my existing positions and take profits off the table as we get nearer to 23 June.

If I were to take a gamble, I would go long on the Pound (GBP), firstly because it has already dropped quite a lot to “discount” the possibility of a Brexit, and secondly because I think that Britain is more likely to stay in the EU. These are just my random musings. 😀

Good luck!

 

Sources:
http://www.bbc.com/news/uk-politics-32810887
http://www.bbc.com/news/uk-politics-eu-referendum-36511598

Daily Trade Alerts: 141 Pips Profit on EUR/GBP (Forex) Trade before FOMC!

Yesterday, before the FOMC, we took profits on one of our trades, netting a whooping profit of 141 pips on the EUR/GBP.

Congrats to all those who took this trade!

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Daily Trade Alerts posted everyday on various products. Perfect for beginners to start making profits easily.

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After placing the trade on my trading account, I immediately shared it across various platforms, such as the Synapse Network private forum etc. This is to enable everyone to follow how we do our trades.

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Getting ready to take our profits!!! $$$ 😀

Stay tuned for more “Daily Trade Alerts”!

Shorting the S&P 500 – Potential Trade of the Year?

Recently, after reviewing all the charts, I found a trade with excellent R/R, and potential to become the trade of the year. 😀
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HERE IS THE TRADE POSTED IN OUR DAILY TRADE ALERTS:

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I am referring to the trade on the S&P 500 short, which we started accumulating positions about 2 weeks ago, and will continue to find pullbacks to continue shorting.

 

HERE IS THE DAILY CHART OF THE S&P 500:

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There will definitely be up and downs in this trade, as you can see from the previous instances, that the trade will not simply move one way all the time. Hence, I will be monitoring it on a daily basis to capture its swings, while capitalizing on its downward bias.

If this works, I can take the rest of the year off from trading. 😀 Just kidding haha

For more details & analysis on this trade, do join us next week for my free trading workshop:
http://synapsetrading.com/free-workshop-registration/

Cheers, and see you there!

Price Action + News Trading: 297 Pips Profits on USD/JPY in Record Time!

Last week, the BOJ surprised markets by holding off on more stimulus. But it also gave us a good chance to make some quick profits in the market.

To be more precise, it put 297 pips of profit right into our pockets.

Here is what led up to the trade, and the thought process behind it:

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Source: http://www.bloomberg.com/news/articles/2016-04-28/boj-holds-off-on-more-stimulus-to-gauge-impact-of-negative-rate

 

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Next week, in my free workshop, I will be sharing more about this trade and price action strategies, and why it is the only tool used by all professional traders worldwide.

See you there! Register: http://synapsetrading.com/events/training-workshops/

Back from my Holidays – Made a Killing in STI, Oil & AUD/USD! $$$

I’m finally back from my holiday! 😀

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Before leaving for my holidays last week, I conducted a monthly workshop, where I shared some of the best trading opportunities for the week that I would be away.

Some of them included going long on the STI (Stratits Times Index), going long on Crude Oil, and going long on the AUD/USD.

 

DAILY TRADE ALERTS:

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GOING LONG ON THE STRAITS TIMES INDEX (STI)

Amazingly, we managed to go long on the STI at the exact turning point, and almost immediately, the STI rocketed 75 points within the next few days. How did we managed to spot the turning point with such uncanny precision?

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GOING LONG ON CRUDE OIL

Crude oil prices soared on hopes of the talks, and applying the “buy on rumour, sell on news” principle, we managed to take our profits near the high before the talks. Eventually, the talks did not turn out well and prices gapped down.

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LONG POSITION ON AUD/USD

We are still holding onto this position to ride it for a larger profit. 😀

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HOW DID I MANAGE TO DO IT??!??!

If you would like to find out how I manage to make money consistently from the markets with 15 minutes a day using just my mobile phone from anywhere in the world, join me for a free training workshop next week: http://synapsetrading.com/events/training-workshops/

See you there! 😀