Today’s Key Market Drivers: 4th September 2018
“US v China and Europe trade tensions keep emerging market currencies under pressure.”
US markets were closed on Monday for Labour Day and with no high impacting economic data to be released currency markets were mostly rangebound. Each time trade tensions hit in the headlines this has benefited the safe haven currencies such as the US Dollar, Yen and Swiss Franc. There were no significant momentum shifts on Monday, however, emerging market currencies including the Aussie and Kiwi Dollars remain under pressure. As a currency trader, I am big on knowing why prices are moving and understanding risk on and risk off trading environments impacting price movements. Knowing this can assist you to win big from time to time by staying in trades that are benefiting from either a risk on or risk off environment.
Today sees the release of the RBA’s September Policy Statement and as expected the RBA will keep the official cash rate on hold at 1.5%. The Aussie Dollar has been falling in recent days on the back of emerging market currencies once again feeling the heat from trade tariff concerns between the US, Europe, and China. China’s growth is being questioned and if the tariffs imposed by the US on China begin to have any negative impact on the data numbers in future months then commodity-based currencies such as the Aussie Dollar, Brazilian Real, and South African Rand will come under increased selling pressure. Add to this an Australian economy that is going to feel the heat from banks independently raising interest rates on variable home loans and I just don’t see any respite for the Aussie Dollar any time soon. I have been consistently reminding traders that the local currency has every probability of seeing significantly lower levels as US interest rates rise and Australian interest rates continue to remain on hold.
I have been reminding traders at my recent Master Classes of the importance of consistency. How you identify, execute and manage your trades in a consistent manner will go a long way toward helping you make meaningful profits. So many times I see traders switching between strategies chasing the next system they think will deliver them consistent profits. In my experience the more you switch, the more you adjust stop losses and targets the higher probability you will self-sabotage trades. If you ever find yourself moving stop losses and targets and exiting trades early without a very consistent approach what you are saying is this. “I know where the market is going next.” The reality is you have no clue on where the market is going next because you don’t know who’s going to buy or sell after you. Remember trading is a numbers game over a series of trades and the more you adjust and switch plans the more you are reducing your profit opportunity over the long term.
Any trade updates throughout the day will be sent via Trade Time. You can also follow my daily updates on Facebook, Twitter, Instagram by searching for TrainwithAndrew. Make sure you subscribe to the Andrew Barnett YouTube channel after watching today’s Sunrise video below.
About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
If you would like to speak to one of our Senior Client Advisors regarding the relative client opportunities offered at LTG GoldRock and how you can follow along with our Professional traders each day in our live trading room please contact us today or you can register for one of our a live coaching and trading webinars by clicking here.