What happens when you take away the drugs from an addict? You get withdrawal symptoms.  Agitation, anxiety, and a volatile change in behavior.  And those are just a few of the immediate side effects. Well, we know that this market rally has been addicted to all the Fed’s easy money printing.  It's helped prop up the stock market and risk taking in general. And ever since the Fed pledged to inject $85 billion per month of liquidity into the veins of the financial system with…
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A quick note before we dive in... I want to take a moment to thank all of you who've commented on my previous articles.  Your interest and encouragement make it fun writing for you each week, and I hope to continue the discussion. Forex trading has been my professional life's work -- my wife would say it's been my "mistress" -- and I love teaching people about it. For those of you who've asked when you can expect more from me ("articles are great, but I want MORE!"), keep…
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        I've been thinking for a few days about what I want to write about for this week's article.  I remembered writing an article a few years back discussing what I have found to be one of the most important and most overlooked ways to stay profitable:  Trading within your comfort level.  You can try to mimic the most successful traders all you want.  But if their trading style is not within your comfort level, then it can…
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Are you getting sick and tired of all the QE taper talk nonsense yet? Just about every day, there’s another Fed President giving a speech somewhere throwing in their two cents on what the next path of the Fed’s monthly asset purchase program should be. And while the Fed is currently buying $85 billion per month in bonds, the reality is that it will soon become too much of a QE dose for the credit markets' constricting veins to handle, as the US Treasury won’t need to issue nearly…
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When I started in the FX market in London, I knew nothing. I had, at that point, never traded anything before. I didn’t know a bid from an offer. I had no idea what I was getting into. It took me a few days to even realize that the 3’s, 5’s and 10’s that people threw around referred to millions of pounds (I started on a GBP/USD, or cable, desk), and to become suitably terrified. What I didn’t realize was that hiring people who knew nothing about markets was a deliberate…
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Are you flying blind? To understand the future of the asset class you're trading, you must at least have a general understanding of the global intermarket relationships.  But it can be frustrating trying to gain clarity on so many moving parts of the global financial markets.  The U.S., Asia, South America, Europe -- their currencies, their bonds, their stocks, how they price commodities and how much volume they trade.  How can you possibly keep track? Even if you're a full time analyst,…
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Since the November lows, this latest leg to the stock market rally has been quite remarkable.  In the past seven months, the S&P 500 has rallied 21% while the Dow Jones Industrial Average has tacked on almost 3,000 points and set another new all-time closing high of 15,409 just two days ago! The rally has deflected macro recessions, flare-ups in the Eurozone debt crisis and slowing growth fears in other large economies like China and Brazil. Yet here we are in the midst of one of those…
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I am a realist. I would love to tell you that there is only one way to trade Foreign Exchange, and that only I know what that is; that there is some magic signal to look for that never fails. Of course, that wouldn’t be true, and if you are intelligent enough to read The Tycoon Report, you wouldn’t believe me anyway. The fact is that FX trades, like most, are often a conglomeration of things... a mish-mash of fundamental and technical... a combination of inspiration and perspiration.…
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On a day like today, when you see the large-cap S&P 500 up .95%, you have to look around at the stocks that aren't up with the market and consider exiting those stocks.  At the very least, hedging those positions.  Why?  Because those are the stocks that are more likely to get hit harder when the market corrects lower! As you've probably heard, the stock market, by many different measures, is very overbought.  It's an extremely dangerous place to be careless lately. …
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