Investors have continued to throw caution to the wind and both the U.S. and Canadian stock markets have been benefiting. While U.S. stocks are pushing beyond all time highs, the Canadian stocks (while off of the lows) are still under performing. With the volatility index (VIX) heading back down to the lows of the year it is clear that traders and investors are in "risk on" mode. Gold, silver and bonds are showing signs of a potential turn around while oil chops about at the highs of the year. Take a few moments to watch this weeks market forecast and learn to trade the markets with an understanding of where key support and resistance levels and important potential turning points are in all of the major asset classes. Play the video below.
During our trading education tutorials, I often reference a line from the famous value investor Benjamin Graham's allegory describing Mr. Market. He describes Mr. Market as "...a patient if somewhat bipolar fellow. Subject to wild mood swings, he is always willing to offer you a bid or an ask." I love this colorful depicition because it truly puts things into perspective in terms what investors and traders are dealing with on a day to day basis. My reason for bringing this up is that we have been on a wild ride as of the last few weeks. U.S. stocks have been up and down, the Canadian stock market just down, gold and silver sideways, bonds sideways and the list goes on. All this can be attributed to the uncertainty that the Feds and the rest of the global central bankers have brought about in their effort to avoid an economic melt down. Logic suggests that this kind of central banking intervention cannot go on forever and yet the consequences of pulling the proverbial patient off of life support are too scary to think about.
This week is bound to be even more volatile as the world waits to see what Wednesday's Fed meeting is going to yield. This indecisiveness is outlined in this week's market profile. However despite the fact that markets are fraught with uncertainty, price action seems to be respecting important support and resistance levels. Every trend has a point at which it pauses and either reverses or continues..the media often then searches for the reason. We are at that point with many assets and must be patient. As the old saying goes..."when in doubt...stay out" and I will add, if you are in, be sure to have a management plan to handle risk. It's not up to you which way the market is going to go, but you do have control over how much risk you are exposed to in the face of uncertainty.
Take a few minutes to watch this weeks market forecast and whether you are an experienced investor or aspiring to learn to trade for yourself, remember..."Mr. Market has no ego, he does not care about being right or wrong; he only exists to separate the rubes from their money". Thanks Benjamin Graham for your simple and timeless description of our "opponent".
Weekly Market Forecast - June 17, 2013
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As a trader and educator, one of the the most important yet often misunderstood considerations is the impact that implied volatility has on the success or failure of an option trading strategy. This is why when people seek us out to help them learn to trade stocks and options, we spend a significant amount of time focusing on this concept.
Many of the assets that we track have been exhibiting significant volatility as bulls and bears jockey for control. For the investor learning to trade the markets this can result in a rollar coaster ride of emotion. In this weeks market forecast we take a look at important support and resistance levels for stocks, currencies, commodities and bonds. These levels help the active investor identify turning points in the market for risk managment and profit taking. Be sure to click READ MORE and watch this weeks short video.
Market Forecast Video June 10, 2013
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Before you begin to learn how to trade and invest for yourself, it's important to accept some facts about this business.Trading is NOT mathematics, a science or a formula. Much like any other profession, it requires a skill that can ONLY be learned from trading and investing beside someone who is successfully applying that skill. We at Learn To Trade Global are constantly amazed at the number of people who read a book, take a seminar or watch a video and willingly put their hard earned money on the line. Let me be very clear about what you will be facing as a trader or self directed investor. Trading is a ZERO SUM game, which means for every winner there is a loser. Money Only changes hands in trading, “BE AWARE” there are some VERY smart and skilled operators ready to help you part with your money.
Topics: learn to trade, learn to invest, independent trader, independent investor, learn how to trade and invest, succesful investors, successful traders, trading psychology, zero sum game, mr. market, warren buffet, benjamin graham, trading instincts