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4 STEPS TO TRADING PROGRESS : HEAR -RECEIVE -BELIEVE -APPLY

  
  Uncategorized
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HEAR

To HEAR you have to listen and listen intentionally. You will not HEAR properly if you are focused on other things. This situation is especially true on a webinar or during the trading day when the markets are open. It is essential to set distractions aside and HEAR what is being stated.

RECEIVE

To RECEIVE something you have to HEAR it and come into agreement with it.  To RECEIVE is to take it unto yourself and personally grab hold of what you have heard and make it your own.

BELIEVE

To be successful you have to believe that what you HEAR and RECEIVE can add value to your current situation. You have to BELIEVE that a specific strategy repeated and correctly  executed, regards of any specific outcome, will provide successful results over time. You will act on what you believe In all areas of life.  Please make sure you really do BELIEVE it and are not allowing any contradictory mindset to compete with your belief because it is possible to hold two opposing beliefs at once. This is being double minded and leads to instability.  Being firm and unswayed in what you BELIEVE can lead to becoming a successful trader.

APPLY

APPLY Is taking action on what you BELIEVE. You will not fully apply something until you fully believe it. Application requires action. You must be willing to pull the trigger on a trade when all of your rules are meet or when all the T’s have been crossed.  You must also without reservation pull the trigger to exit at your predetermined stop loss. Regardless of what we think or BELIEVE we will also act out of core or dominant belief. To properly apply ourselves we have to revise our core beliefs.  If I APPLY all of my predefined rules for entry and exit even when the trades go against me, my core belief will keep me confident that I did the right thing in making this trade and over time I will accomplish my goals. In addition my loss will not stress me because based on following my predefined rules it was a small loss based on a predetermined, well thought out process.

As we move forward we should focus on hearing , receiving, believing and applying.

CFTC commitments of traders: EUR longs spike by 32K to a record long level

  
Analysis, Forex
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Weekly FX speculative positioning data from the CFTC

 

  • EUR long 157K vs 125K long last week. Longs increased by 32K
  • GBP short 25K vs 15K short last week. Shorts increased by 10K
  • JPY long 29K vs 19K long last week. Longs increased by 10K
  • CHF long 8K vs 7K long last week. Longs increase by 1K
  • AUD short 5K vs 0K long last week. Shorts increased by 5K
  • NZD short 1K vs 2K last week. NZD switches from long to short. 3K change
  • CAD short 13k vs 17K short last week. Shorts trimmed by 4K
Highlights:
The BIG HIGHLIGHT for the week is in the EUR.  The EUR longs spiked up by 32K to 157K in the current week to a record high for long positions. The move higher is corresponding to higher EURUSD prices. The price of the EURUSD has been up for 6 consecutive weeks.  The long position started to move more to the upside during the May 19 week when the position was at 72K.  The EURUSD during that week was down at 1.0800. The price high today reached to 1.1908 before backing off.  Nice trade for the longs.
Of course, a concern for markets that get too long or short, is that there can be a squeeze the other way if prices start to lose trend momentum.   As a result, be careful of too much of a good thing, but let the technicals tell the story. They have been bullish.
Weekly FX speculative positioning data from the CFTC_
The GBP shorts, however, increased by 10K to 25K (still much lower than the EUR longs) while the currency has moved higher.
The JPY longs increased and the USDJPY moved down (higher JPY) into early trading today. However, the price snapped back higher and nearly erased the full move lower this week in a single day.

USA credit rating outlook revised to negative from stable by Fitch

  
  Analysis
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Bold move by the rating agency

USA downgrade Fitch
The rating was affirmed at AAA but lowered to negative from stable. That’s how you get yourself a lawsuit.
  • Cites ongoing deterioration in public finances
  • Sees general debt to GDP above 130% by 2021
  • Expects deficit to narrow to 11% of GDP in 2021
  • Expects US economy to contract 5.6% this year
  • Statement
What Fitch had to say:
The Outlook has been revised to Negative to reflect the ongoing deterioration in the U.S. public finances and the absence of a credible fiscal consolidation plan, issues that were highlighted in the agency’s last rating review on March 26, 2020. High fiscal deficits and debt were already on a rising medium-term path even before the onset of the huge economic shock precipitated by the coronavirus. They have started to erode the traditional credit strengths of the US.
They’re not wrong.
Another risk they cite is the possibility of policy gridlock after the election because neither party will get a 60-seat Senate majority.

Major indices close higher and at session highs. NASDAQ leads the way with Apple, Facebook, Amazon outperforming

  
Analysis, US Market
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Dow, S&P, NASDAQ close higher for the 4th consecutive month

the month of July is over and all the major indices closed higher for the 4th consecutive month. The S&P index had its second-best July performance since 2010. Apple, Amazon, Facebook all of the way after their earnings release last night. Apple rose up 10.47%. Facebook rose 8.18% and Amazon rose by 3.7%.  Alphabet was left out despite posting better earnings. Their stock fell by -3.28%.

On the downside the Dow post its 2nd straight weekly decline.
The final numbers are showing:
  • S&P index up 24.9 points or 0.77% at 3271.12
  • NASDAQ index up 157.46 points or 1.49% at 10745.23
  • Dow industrial average up 114.67 points or 0.44% at 26428.33
For the week, the NASDAQ led the way. The Dow industrial average could not make it to the unchanged level falling by -0.16%:
  • S&P index rose by 1.73%
  • NASDAQ rose by 3.69%, and as mentioned
  • Dow fell by -0.16%
For the month, the market initially tried to rotate out of the NASDAQ stocks and into the industrial/broader market, but the run up in tech stocks today and this week push the NASDAQ back into the lead:
  • S&P index rose by 5.51%.  As mentioned it was the 2nd largest July increase since 2010
  • NASDAQ index rose by 6.82%
  • Dow rose by 2.3%
For the year to date, the Nasdaq index continues to outperform, but the S&P index has moved back into the black (it dipped into the red earlier this week). The Dow remains lower on the year.
  • S&P index up 1.25%
  • Nasdaq up 19.76%
  • Dow down -7.39%
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