The USD’s rally is catching the attention of commentators.
However, their focus is on the Dollar Index, which ISN’T a good indicator of USD performance.
A high CPI reading reversed last week’s rally, reiterating markets’ bearishness, while increasing volatility & correlation – which isn’t good news.
Most traders grasp the importance of emotional awareness when trading.
However, most aren’t aware of how important it is when they are out of the market.
Markets have gone from looking bearish to bullish in the space of a week. However, medium term trends remain bearish.
How will this bounce end?
The problem with trading emotionally isn’t so much that emotions are unreliable, it’s that allowing them to dictate decision making is frightfully inconsistent.
If you want to become a better trader, you will have to become intimately acquainted with yourself.
How do you react emotionally to losing & making money?
The USD’s warning continues to sound, as it pushes higher against both EM and DM currencies.
Keep watching USDCNY, base metals, and the US yield curve.
Equity markets continue to break below key levels.
With the USD running rampant again, bears look set to reassert themselves in stocks.
95% of retail traders lose money.
This doesn’t mean that trading is a fool’s game, only that it is very difficult.
How then do we become better traders?
The USD continues to strengthen broadly, and macro markets remain stuck in their negativity, warning of worse to come for risk assets.