Money Flow Trading Method along with Risk Management

Who says you can't trade with charts only?? Money Flow does give me more confidence with the direction though. Didn't short the Dow as it going above 20,000 messed my entry plan up. Should've after the open yesterday. I'm all cash at moment as well...looks like UJ is well on the way to 110.

I am hoping to close my last two open positions of SHORT US 30 of 100 units once Dow 30 reaches 19,750 or so and if that happens my cash balance in my FXCM UK $50,000 US Funds Account will be over $72,000 US Dollars in just 6 weeks of Forex Trading.

My students have helped my own discipline and it has been great fun and good personal satisfaction even though I can only post in this thread and not even like my friend's posts. KeepCalmfx.

I am so looking forward to soon be able to post on our corporation website and say a nice good bye to Forex Factory who I do sincerely appreciate as they clearly have in my opinion the best Forex website in the world.


Benjaminis

piphunting

I appreciate your post and your opinion. My only clear and real point is that when you know the correlations that Money Flow Trading produce then you know before the charts the directions. Look at the X Ray's that KeepCalmfx produced and look at what happened. The way we trade along with using proper Risk Management produces results that few can duplicate. I have generated 44% or $22,000 US Dollars in profits in just 6 weeks and my friend , KeepCalmfx is not that far behind after only 5 weeks of trading against my 14 years of learning.

As I have said many times on this thread , whatever works for you is great however as a professional I need to be certain about my Forex trading and teaching business and I am.


Benjaminis

Hi Benjamin

Please see post 526, for directions on the screen shot.

Thank You Very Much KeepCalmfx

We both now realize that what we do is the way to success. I am soon ready to close my last two positions of US 30 Short 100 units.

This has been a fun day.


Benjaminis

Great Chart on EUR/USD

http://www.forexfactory.com/attachme...2&d=1485880831

Still looking at possible Trade Plan Five that would be SHORT 100 units of EUR/USD.

We will see after Friday and NFP.


Benjaminis

Hi Benjamin

Well done on your amazing results!

Just a quick question. I know you said at some stage you traded without stop losses. What is the maximum drawdown you had on one position at anytime in the past 6 weeks of achieving this results?

I agree with you Benjamin.

I had 8 positions today, all closed total of $ 1625 profit.

http://www.zerohedge.com/news/2017-0...ops+to+zero%29

I only have one open position on Short US 30 of 100 units and at 19,750 then I am out and all in cash. At the moment I have a DRAW DOWN of $342.00 US Dollars including rollover costs of $57.00 US Dollars.

We will see in the next hour as we reach 4 PM and the Equities markets close for the day in North America.


Benjaminis

KeepCalmfx

What I do at the highest level can only be taught when you are more experienced, however on the FXCM UK $50,000 US Funds Demo Account , I NEVER put out more then $11,000 US Dollars on Margin and since I had build up profits from Memory , I think my DRAW DOWN was at the most $15,000 US Dollars.

However in the other Demo Account started on December 4, 2016 , I traded it without my normal DISCIPLINE intentionally to test to see if I could get a Margin Call as I had many positions on.

You will see this better when I post the results with a SCREENSHOT.

I accomplished my goal and now can say for sure that my style of trading, which is what what we teach here is the only way to go.

My results of over $72,000 US Dollars confirms that.

Thanks for your question.


Benjaminis

I kept my position open because with Month end they wanted the Dow positive for the month so will look to close my one open position of US 30 Short on Wednesday. My Limit Out Order is entered.

Catch up on things later tonight. Watching GEOPOLITICAL SITUATION and of Course Tomorrow is FED Decision and Thursday ECB Decision and Friday is NFP CASINO DAY !!! :-)


Benjaminis

http://www.bkassetmanagement.com/dai...fumbles_10435/

Snippet:
January 31st, 2017

Market Drivers January 31, 2017
Cable falls nearly 100 points as data misses
BOJ keeps monetary policy as is
Nikkei -1.69% Dax 0.25%
Oil $52/bbl
Gold $1200/oz.


Europe and Asia:
JPY BOJ keeps policy as is
GBP Mortgage Approvals 67.9K vs. 69K
EUR EU Inflation 1.8% vs. 1.6%
EUR EU Unemployment 9.6% vs. 9.8%


North America:
CAD GDP 8:30
USD Chicago PMI 9:45
Sterling fell hard in morning London dealing today after a series of UK credit reports missed their mark. The pair was down nearly 100 points off its highs dropping to a low of 1.2412 before finding a modicum of support.


A series of UK credit reports showed that UK consumers are starting to retrench. Mortgage approvals missed printing at 67.9K versus 69K. Consumer credit came in at 1.3B versus 1.7B eyed and money supply actually contracted by -0.5% versus forecasts of 0.3% rise.


UK consumers are clearly starting to feel reticent ahead of the looming Brexit vote and spike in costs due to a lower pound may also be cutting into demand for credit as confidence wavers. This week the market will get a glimpse of the latest PMI reports and if those show a deceleration of activity cable could retest its recent lows at 1.2200.


Elsewhere in Asia, markets were generally quiet for the weeklong Chinese New Year holiday, but in Japan the BOJ reaffirmed its monetary policy position maintaining the full array of policy initiatives. USD/JPY seesawed in violent reaction to the news, partly because at the same as the news was released President Trump fired the acting Attorney General for not complying with his immigration orders.


The pair them settled down for rest of Asian and European trade but remains below the 114.00 level for the time being. The volatility of the Trump White House is clearly being felt in the currency markets and so far US data has done little to assuage investors.


Today the US calendar is quiet with only Chicago PMI on the docker, but tomorrow the market will begin to receive a deluge of data including ISM Manufacturing, ADP and most importantly the FOMC statement.

If the eco data surprises to the upside it should soothe the frayed nerves, but further misses on the eco front could pressure USD/JPY back to 112.50


Comments from Benjaminis: Good Knowledgeable People Kathy and Boris.

https://dailyreckoning.com/charts-pr...y+Reckoning%29

Snippet:
30 Charts Proving Were In The Mother of All Financial Bubbles

Sentiment about the U.S economy continues to rise, but the looming threat of financial bubbles and economic crisis on a global scale could not be higher.

The big, fat, ugly bubble that Trump as a presidential candidate identified in the stock market is real and is currently being allowed to fester.

Financial bubbles have multiple facets (China, property market, etc) and could very well be expanded beyond this list. But selected below you will find 30 charts from government, private sector and independent research outlets proving that were in the mother of all bubbles.

The higher these bubbles get, the more dangerous the fall.

1.The Inflationary Boogeyman
Economist Lance Roberts delves into exactly what interest rates and economic growth reveal in the economic environment it does not look pretty. The Effective Federal Funds Rate seen below in a flatline shows just how big a problem the U.S central bank is in.
https://dailyreckoning.com/wp-conten.../2017/01/2.png


Roberts writes, With Yellen, and the Fed, once again chasing an imaginary inflation boogeyman (inflation is currently lower than any pre-recessionary period since the 1970s) the tightening of monetary policy, with already weak economic growth, may once again prove problematic.

The biggest fear of the Federal Reserve has been the deflationary pressures that have continued to depress the domestic economy. Despite the trillions of dollars of interventions by the Fed, the only real accomplishment has been keeping the economy from slipping back into an outright recession.
Real Investment Advice


2. Even The Rich Are Feeling the Squeeze
The Hamptons, deemed by Forbes as Where Wall Streets Richest Retreat, are experiencing a considerable slowdown in the residential housing market. When even the top 1% of the 1% of Americans are in a housing slowdown, questions begin to rise as to how sustained our economic recovery is.
https://dailyreckoning.com/wp-conten.../2017/01/1.png
https://dailyreckoning.com/wp-conten...017/01/1-1.png


The Wall Street Journal reported this slowdown and noted that it was in part due to too much overpriced inventory and it is rising. When prices are too outrageous for even the top income earners, a Wall Street housing bubble could follow.
WSJ


3. Big Money Hits Historic Levels
Bloomberg ran an article looking at the growth of the hedge from industry noting that Hedge Fund Assets Pass $3 Trillion in 2016 for First Time.
https://dailyreckoning.com/wp-conten.../2017/01/3.png


The article expands upon this massive growth in assets, The industry, which saw about $70 billion in outflows last year, had about $2.9 trillion in assets in 2015.
The bigger they grow, the harder they fall.
Bloomberg


4. Debt Slaves At Risk of Debt Crisis
Debt is no stranger to the American public. From financing cars to massive home mortgages, debt is a part of everyday life and getting bigger. While an abundance of methods track just how debt burdens impact households, it is clear that America has a massive debt problem.
https://dailyreckoning.com/wp-conten.../2017/01/4.png


Wolf Richter writes, There are many ways to measure household indebtedness and debt burdens. Comparing total household debt to the overall size of the economy as measured by GDP is one of the measures.

And per this household-debt-to-GDP measure, Americans are in 10th place with 78.8% and look practically prudent compared to the peak just before the Financial Crisis (via Trading Economics):
Wolf Street


5. China is Going Broke
Goldman Sachs reveals its estimate on size of Chinas debt It aint pretty. China has a massive difference between the overall debt burden it currently holds in contrast to the overall GDP level it has been able to maintain for growth.
https://dailyreckoning.com/wp-conten.../2017/01/5.png
https://dailyreckoning.com/wp-conten...017/01/5-5.png


The indicators above were created by financial giant Goldman Sachs research in which they claim the unfolding trend, raises questions of sustainability over the medium term, given the already-large increase in Chinas debt-to-GDP ratio in recent years.
When the top dogs on Wall Street begin to raise questions, the party is almost over.
Business Insider


6. Subprime Auto Loans: The Next Financial Bubble?
Jamie Dimon, head of JPMorgan Chase during a call with investors last July noted his growing worry about the stretched automotive loan market. Dimon noted that while he does not believe it is a systemic issue there are considerable risks. If Dimons record speaks for anything, be worried and know that it will likely be much worse (Wall Street does not have a great record for calling crashes hell, look at 2008).
https://dailyreckoning.com/wp-conten.../2017/01/6.jpg
https://dailyreckoning.com/wp-conten...2017/01/6b.jpg


Jeff Desjarins notes at the Visual Capitalist, Subprime auto loans which are riskier loans made to customers with poor credit have helped to drive the market since the Great Recession.
However, with auto loan delinquencies ticking up in recent months, investors have been searching for answers about the sector.
Visual Capitalist


7. Latest Cause of U.S. Economic Depression: Demographics
Not only is our economy slowing, but our population is now hitting its oldest on record.
https://dailyreckoning.com/wp-conten.../2017/01/7.png

Economist Jim Rickards reports that, Since economic growth is simply the sum of workers and productivity, the lack of population growth means fewer workers and, therefore, less economic growth.
Productivity is declining, also making the situation worse.

The last time this happened to such an extent in the U.S. was during the Great Depression of 19291940.
Bloomberg


8. Too Big To Fail Again
The top bank holding derivatives Citigroup, was the same bank in 2008 that saw its toxic derivatives and subprime debts explode, has over $55.6 trillion in holdings.

That means that not only are Citigroup and banks of its size and complexity holding a massive amount of money being speculatively bet, but that the risks are being backed by the U.S government.
https://dailyreckoning.com/wp-conten.../2017/01/8.jpg


During a press conference in March 2016 while speaking on financial reform President Obama said:
Irresponsible, risky bets with inadequate safeguards and that reward executives who take those risks greatly, can cause enormous damage to our economy overall..
He went on to champion the reforms made and the false accusations by the press noting that, Wall Street reform, Dodd-Frank, the laws that we passed have worked. I want to emphasize this because it is popular in the media, in political discourse, both on the left and the right, to suggest that the crisis happened and nothing changed. That is not true


In retrospect, the most disappointing and dangerous part of his conversation was when he announced that the administration was taking action. President Obama said:
We are moving in the derivatives sector; a huge amount of oversight and regulation and now you have clearinghouses that account for the vast majority of trades taking place so that we know if and when somebody is doing something that they shouldnt be doing; if theyre over-leveraged in ways that could pose larger dangers to the financial system.

The derivative world, where Wall Street continues to hedge its bets, has not been stopped.

A large percentage of activity surrounding derivatives continues to happen in the dark. If and when this bubble pops, the extent of its damage could present catastrophic levels of burden on the U.S government and its taxpayers.
Office of the Comptroller of the Currency


9. Housing Prices in Western Economies on Steroids
Growing fears of a massive global property price drop take root under growing conditions that signal a slow-down in the market. Across three different continents, housing prices have increased in exponential ways.

This rapid ascension surpasses the pre global financial crisis levels and offers an entirely new standard from which the worlds economy could fall in the perils of a housing bubble.
https://dailyreckoning.com/wp-conten.../2017/01/9.png

Catherine Mann, the Organization for Economic Co-operation and Development (OECD) chief economist said a number of countries, including Canada and Sweden, had very high commercial and residential property prices that were not consistent with a stable real estate market.
The Telegraph


10. Chinese Credit Soars
China has been a leading supplier of global goods over the past several decades. As many economist have written about the booming Asian giant, the demand for credit in the country since the global financial crisis has taken on in drastic ways.

The threat of economic turmoil and what it might do to the Chinese (and therefore global) economy is real.
https://dailyreckoning.com/wp-conten...2017/01/10.png

Jim Rickards tells us, So far, the Chinese government has been able to contain the damage from these bursting bubbles with monetary ease, bailouts and market manipulation. But the biggest bubble of all the credit bubble may now be getting ready to burst.
Bloomberg


11. Recession Speculation Swirls: Federal Reserve is Stuck
Ambrose Evans-Pritchard notes that, The world has never before been so leveraged to dollar borrowing costs. The Bank of International Settlements data show that debt ratios in both rich countries and emerging markets are roughly 35 percentage points of GDP higher than they were at the onset of the Lehman crisis.

The fact that the Federal Reserve cannot get out of its own way, in the face of a potential recession shows how grave an economic bubble threat is.
https://dailyreckoning.com/wp-conten...2017/01/11.png

It is a little scary. When nominal GDP slows like that, you can be sure that financial stress will follow. Monetary policy is too tight and the slightest shock will tip the US into recession, said Lars Christensen, from Markets and Money Advisory.
The Telegraph


12. Holiday Shopping Numbers Signal Lost Confidence
Black Friday is dead. Even holiday spenders know something is wrong.
According to the National Retail Federation, 36% of shoppers said all of their buys were sale items. When big even big ticketed items (electronic appliances, high-end retail) are not selling on traditionally high volume days the economy should realize that deterioration is real.
https://dailyreckoning.com/wp-conten...2017/01/12.png

Greg Guenthner tells us, The data is clear: its becoming increasingly difficult to get customers out to stores on Black Friday.
To this point, not only is it difficult to get them out but it is even more of a challenge to get them to spend on normal priced inventory.
The Rude Awakening


13. Government Holding the Bill
Below is the total consumer loans that are currently being held by the U.S government that are outstanding.These consumer loans are made up primarily of mortgage loans and other big ticket real estate areas.
The sudden rise at seen at the end of the chart thats not normal.
https://dailyreckoning.com/wp-conten...2017/01/13.jpg

As one U.S treasury report noted, Any abrupt change in the liquidity or performance of
these legacy assets is unlikely to spill over into broader financial markets.

The Treasury report directly referenced the commercial real estate because they tend to shift loans and move along with broader economic cycles while ultimately impacting the total consumer loan operation.
The broader economic cycle experienced shows a drastic difference from the historic norm that had been part of the American experience.
The Federal Reserve Bank of St. Louis


14. Exploding Student Loan Debt
Student loan debt continues to hit record high numbers. This means that those entering the workforce, and entering into a participatory level of the economy bring a debt load that has never been seen before.

Mark Kantrowitz, one of the nations leading student financial aid experts noted, I also found that students who graduate with excessive debt are about 10% more likely to say that it caused delays in major life events, such a buying a home, getting married, or having children.

We have gained an increasing understanding that how we finance post-secondary education has significant effects on a variety of critical economic outcomes, including economic growth and inequality, William C. Dudley the president and CEO of the Federal Reserve Bank of New York.

The Federal Reserve Bank of St. Louis and Graphiq


15. Government Debt Soaring
The government debt-to-GDP has shot to levels not seen in well over three decades.

According to the OECD, General government debt-to-GDP ratio is the amount of a countrys total gross government debt as a percentage of its GDP. It is an indicator of an economys health and a key factor for the sustainability of government finance.
https://dailyreckoning.com/wp-conten...2017/01/15.png

The chart above is based on general government debt data from the Organization for Economic Co-operation and Development (OECD) that gathered data from 1995-2014 evaluating U.S debt-GDP. The massive swing in data upwards as you reach 2014 show a clear skyrocketing effect of general government debt.
The bubble that might just pop could be best seen in the dependency of government activity in debt.
OECD


16. Household Net Worth/GDP At-All Time High
David Stockman, Ronald Reagans former budget director notes this troubling trend cannot be sustainable. He tells us, Even after the financial crisis and the results of deleveraging, the household leverage ratio is still in the nosebleed section of history at 180% of wage and salary earnings. Meaning households are still heavily in the weeds in terms of what they make as opposed to what the economy is doing.
https://dailyreckoning.com/wp-conten...2017/01/16.png

Stockman offers his analysis, The screaming risk embedded in the green line of the graph above can be readily specified. Since 1999, for example, the value of owner-occupied residential real estate in the Feds Flow-of-Funds report (F/F report) has risen from $10.1 trillion to $22.7 trillion or by 5.2% annually.
https://files.admin.agorafinancial.c...ng-635x120.jpg

https://ads.agorafinancial.com/www/d...&cb=ab159ce2b5


The current $22.7 trillion mark-t0-bubble for residential real estate has far less capacity to be sustained than the similar peak back in 2006, and a lot farther to fall when the day of financial reckoning finally arrives.
Federal Reserve Bank of St. Louis and Contra Corner


17. Market Prices at Record Levels
When stock market prices reach such highs, some would argue that it becomes outright dangerous to own and invest in stocks. The potential for a massive bubble at such heights in places seen like the Russell 2000 should offer particular alarm.
https://dailyreckoning.com/wp-conten...2017/01/17.jpg

According to Bloomberg, the financial sector make up over 27% of the index. This shows that a major portion of the financial industry is integrated within the price valuations that have hit never seen before levels.
Federal Reserve Bank of St. Louis

18. The Cheap Money Debt Trap
Bloomberg reports that the mortgages that were set in 2007 are set to mature after eclipsing the peak levels seen in 2008.
A $90 billion wave of maturing commercial mortgages, leftover debt from the 2007 lending boom, is laying bare the weak links in the U.S. real estate market.
https://dailyreckoning.com/wp-conten...2017/01/18.jpg

The fact that the U.S commercial space has surpassed the rates at which were present during the global financial crisis should send out a warning sign. The artificial money that was pumped into commercial-property space pose a particular set of exposure to the real estate market again.
Bloomberg


19. The Booby Trap of Federal Debt
According to the New York Times, the Federal debt is projected to expand by a massive $10 trillion in the next ten years.
https://dailyreckoning.com/wp-conten...2017/01/19.jpg

This federal debt is of particular concern in when deliberating who might be left to bailout banks or the general public in the instance of another financial bubbles in the market.

The Congressional Budget Office (CBO) which is a strictly nonpartisan operation from the U.S Congress that conducts objective, impartial analysis notes that, If current laws remained generally unchanged, deficits would follow an upward trajectory over the next decade, driving up federal debt.
Congressional Budget Office


20. Dow Jones Worse than 5 Years Ago
Wolf Richter of Wolf Street notes, Apple, whose revenues have skyrocketed by over 1,000% since 2006, from $19.3 billion to $216 billion, became a Dow component in 2015, replacing AT&T. And its revenues werent part of the 30 Dow components until 2015.
https://dailyreckoning.com/wp-conten...2017/01/20.jpg

So heres what the aggregate revenues of the Dow components look like without Apple (blue columns) and without Apple but with AT&T (brown columns). A pure stagnation fest:
He goes on to offer analysis that, In both scenarios, revenues in 2016 were lower than they had been in 2008. Only 2009 and 2010 were lower. So in terms of revenues, 2016 was for the Dow components ex-Apple the worst year since 2010! And this despite the five-year binge in acquisitions!
Wolf Street


21. S&P and Blind Bubbles
The chart below shows the cyclical nature of bubbles experienced within the S&P 500 and the historical trends of prices given in the market. We have reached levels, yet again, not seen before. While that might seem like a good thing in the market, it just means when (not if) the bubble pops it has a significant amount to drop.

David Stockman blasts the blindness of the market saying, the S&P 500s ratio of EBITDA to TEV (market equity plus net debt) is now truly in the sky-box section of history. It has never been close to the current level of 11.3Xexcept during a few months of sheer stock market mania at the turn of the century.
https://dailyreckoning.com/wp-conten...2017/01/21.jpg

Stockman lashes out, Yet fools claim to see not even a hint of bubbles anywhere on the horizon.
David Stockmans Contra Corner


22. Rising Prices on Staple Items
Jeff Desjardins illustrates in the Visual Capitalist how Prices Are Skyrocketing, But Only For Things You Actually Need.

While inflation pushes prices up across all areas of a given market, the U.S has experienced a moderate increase in specific areas of the economy. When prices begin to be artificially set, the market reset can offer high-highs and when the cycle breaks very low-lows.

Remember dinosaurs like Circuit City or Radioshack? The memory of such staple corner stores could soon come to those sectors experiencing significantly higher prices. When it does, the bubble, as the always do, will pop.
https://dailyreckoning.com/wp-conten...2017/01/22.jpg

When the Consumer Price Index (CPI) rises over 55% over the past two decades, it shows that price inflation and overall consumer activity can be widely impacted when a bubble pops in a sector that is artificially high.
Visual Capitalist


23. Systemic Banks and Systemic Risk
Big banks are as connected and dangerous as they were before the 2008 crisis. The IMF reported that Deutsche Bank was the most important net contributor to systemic risks.

The threat of banks being so interconnected is that once they fail, or if they hit market turbulence, it can cause a contagion effect across the world. When one bank catches a cold, the next catches pneumonia.
https://dailyreckoning.com/wp-conten...2017/01/23.jpg

According to the IMF report, The blue, purple and green nodes denote European, US and Asian banks, respectively. The thickness of the arrows capture total linkages (both inward and outward), and the arrow captures the direction of net spillover. The size of the nodes reflects asset size.
International Monetary Fund


24. Banks Bigger, More Leveraged Than Before
The phrase too big to fail might be passed around faster than it it is mentally digested. But the big banks will leave an even bigger crater when the celestial debt bubble crashes down.

According to the U.S Treasury Office of Financial Research, Bank size is an important component of systemic risk.
Think size matters? The bubble size below should sound the alarm:
https://dailyreckoning.com/wp-conten...2017/01/24.jpg
https://dailyreckoning.com/wp-conten...017/01/24b.jpg

the default of a bank with a higher connectivity index would have a greater impact on the rest of the banking system because its shortfall would spill over onto other financial institutions, creating a cascade that could lead to further defaults.

High leverage, measured as the ratio of total assets to Tier 1 capital, tends to be associated with high financial connectivity and many of the largest institutions are high on both dimensions

The larger the bank, the greater the potential spillover if it defaults; the higher its leverage, the more prone it is to default under stress; and the greater its connectivity index, the greater is the share of the default that cascades onto the banking system.

The product of these three factors provides an overall measure of the contagion risk that the bank poses for the financial system.
Office of Financial Research


25. Price Shock in Order
Price to earnings cover exactly what people are making in relation to what they are spending. The chart below shows that the U.S economy is back on the roller coaster and headed for historically dangerous territory.

The cyclically adjusted price-to-earnings ratio has reached a current level seen in the three largest equity market declines in the last century. As you can see in the chart below:
https://dailyreckoning.com/wp-conten...2017/01/25.jpg


Commercial real estate prices have also climbed, and capitalization rates, one measure of the return expected on a property, are close to record lows. A price shock in one of these markets could threaten U.S. financial stability if the assets were widely held by entities that use high levels of leverage and short-term funding.

A price shock that coincided with a sharp increase in U.S. corporate defaults would amplify the risks We are concerned about the market risks facing U.S. banks and insurers.
Office of Financial Research


26. The Great American Slowdown
The GDP over a 10-year period is on a long and scary trend downward. A Gallup research report offers exactly where the economic trends per capita are headed.

A Gallup study in collaboration with the U.S. Council on Competitiveness released in December 2016 revealed analysis of Long-Term U.S. Productivity and showed drastic declines.
https://dailyreckoning.com/wp-conten...2017/01/26.jpg

The Gallup study remarks that, The study finds there is no recovery. Since 2007, U.S. GDP per capita growth has been 1%.

The Great Recession may be over, but America is dangerously running on empty.

The reports author got this representation based on the real GDP per capita growth line is based on the authors analysis of data from the Bureau of Economic Analysis. Growth rates are in inflation-adjusted dollars calculated over 10-year intervals and reported in annual terms.
While examining financial bubbles, this graphic shows that not only are we artificially high in the markets but that U.S productivity is drastically behind.
Gallup


27. S&P Trends Off the Deep End
According to second quarter reports released to the S&P 500 companies records, the earnings decline from second quarter of 2015 to 2016 was -3.2%.
While that drop might seem minimal, according to a FactSet report The second quarter marks the first time the index has recorded five consecutive quarters of year-over-year declines in earnings since Q3 2008 through Q3 2009.
https://dailyreckoning.com/wp-conten...2017/01/27.jpg


That means the financial trends year-over-year are back to 2008 levels. Remember, 2008-2008 was when the U.S (and the world) experienced the worst economic shock since the Great Depression.
FactSet


28. Productivity Outlook: Nowhere Close to Normal
The Federal Reserve Bank of St. Louis produced a Total Industry Capacity Utilization release. According to the regional Fed bank it defined this as:
the percentage of resources used by corporations and factories to produce goods in manufacturing, mining, and electric and gas utilities for all facilities located in the United States (excluding those in U.S. territories).

Translated from Fed speak: That means the percentage of available American resources being used.
Just before the financial crash Capacity Utilization measured at 80.9%, recorded in November 2007. The utilization since then has meandered, and since November 2014 has been on a decline. As of November 2016 the Fed measured overall Capacity Utilization at 74.3, a considerable decline in resources being used overall showing a drastic output potential in decline.

https://dailyreckoning.com/wp-conten...2017/01/28.jpg

In a nation where economic growth sluggish recovery (or lack of recovery) persists, the slump in demands for products year-over-year is a long-run formula for disaster.
Federal Reserve Bank of St. Louis


29. Central Banks Suck Up Money
The biggest central banks in the world have seen a jump is assets as they hit $21 trillion as of October 2016.
That is 29% of the size of the global economy as of 2015 figures (double what it was before the 2008 financial crash).
https://dailyreckoning.com/wp-conten...2017/01/29.jpg


Bloomberg reported that, the accelerating expansion of central banks balance sheets comes as debate rages over whether their asset purchases and continued low interest rates are creating bubbles

To answer the debate question they posted yes, these central bank moves are creating massive bubbles.

As David Stockman told his Contra Corner readers, the entire dynamic of the global bond market and financial system for the past two decades has been capture of the false bond price premiums being created by the massive central bank balance sheet expansion shown above.
Bloomberg

30. Housing Crisis Goes Global
According to Maslows hierarchy of needs shelter is a pivotal component of human motivation. That draws particular concern after the International Monetary Fund (IMF) released a report in December 2016 showing that global housing prices have reached the same levels that they were at the onset of the global financial crisis.

In a survey of 57 countries, the IMF measured simple average price index levels and found that, while there are differences across countries, increased vigilance is needed.
https://dailyreckoning.com/wp-conten...2017/01/30.jpg

Jim Rickards reports that, This time the property asset bubble is global, including high-end real estate, commercial office space, and warehouse facilities. (Subprime is under control, but thats small compared to prime housing and commercial real estate. Its never exactly the same twice.)

This real estate bubble is in addition to all of the other bubbles in stocks, emerging markets corporate debt, high-yield, Chinese credit, and developed economy sovereign debt.

Rickards warns, Cash, gold, and silver may be the only true safe havens when the next crisis hits, probably soon.
via International Monetary Fund

While financial bubbles have emerged throughout history under a variety of conditions, the clear and present danger of this economic environment presents that the threat is real.

Understanding the various factors, and exactly what to watch for can leave you better prepared when examining the market. It will also allow you to stay above the mainstream messaging and see financial bubbles before they pop.
Semper vigilans,


Thanks for reading,
Craig Wilson, @craig_wilson7
for the Daily Reckoning

Comments from Benjaminis: There you have it all my friends. Now you know.

From My Post 1607

 

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 1,440 Posts | Online Now

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4. Noteworthy Posts
5. Making Sense of the Dollar
6. Disclaimer

https://4.bp.blogspot.com/-9C-Z27w3R...7012631346.gif
JAN
26

Are Interest Rates No Longer Driving the Dollar?
The US 10-year yield is at its highs for the year, and yet the US dollar has been struggling to gain traction. Some suggest that this means that the dollar rally is over. Charts like this one are circulating among market participants.

COMMENTARY FROM BENJAMINIS: Since these comments are within my expertise to understand I will offer my views to help all of us understand. The US 10 Year Yield is at it's HIGH as we have been discussing on our thread only because of the FED position on raising Interest Rates perhaps three times during 2017. This announcement created the situation where they broke the Bond Bubble and TRILLIONS of Dollars were LOST as the Bonds sold off and affected Interest Rates around the World.

The MONEY FLOW rotated in Equities as we can all see surely helped along by the election of President Donald John Trump on November 8, 2016.

Now we see the results by the Dow 30 going over 20,000 in the last few days.

This Great Graphic was created on Bloomberg. The white line is the Dollar Index, and the yellow line is the US 10-year yield. The two look highly correlated over the past six months, until very recently.

COMMENTARY FROM BENJAMINIS: The CORRELATION is starting to maybe CHANGE because of the following reasons. The agenda of the FED and the Central Banks around the World appears to be opposite of President Trump. His agenda is to create jobs and protect Americans and help them improve their lives. The AGENDA of the FED and the Central banks is opposite this.

We are not convinced. First, one can see on the chart other times over the past six months where the relationship looked less tight but did not signal a change in drivers. Second, correlation is not something that can always we eyeballed, especially when the chart shows two-time series with two different scales.

JAN
26
Dollar is Firmer, but Mostly Sidelined, as Equity Charge Continues


The US dollar is mostly firmer against the major currencies but is confined to narrow ranges, and well-worn ranges at that, but the focus has shifted to the strong advance in equities. Yesterday, the Dow Jones Industrials finally rose through the psychologically-important 20k level, and the S&P 500 gapped higher to new record levels.

COMMENTARY FROM BENJAMINIS: We now return to President Trump who wants the US Dollar to go down and the FED wants it to go up. The US Dollar MUST go down otherwise it causes harm to the Global community and in effect now the REAL CURRENCY WAR enters into the next stage.
PLEASE POST QUESTIONS IF I HAVE NOT MADE MY EXPLANATION VERY CLEAR. YOU REALLY NEED TO UNDERSTAND AND IT IS NOT THAT HARD IF YOU UNDERSTAND WHAT I HAVE JUST SAID.



The Nikkei and Topix gapped higher too, helping lead the MSCI Asia Pacific Index to a 1% gain and the third rise this week.
JAN
25


Great Graphic: Mexico and China Unit Labor Costs
This Great Graphic was posted by David Merkel on his AlephBlog with a hat tip to Sober Look. It looks at the divergence of unit labor costs in China and Mexico since 2007 through 2015.

The Mexican peso depreciated 17% last year. The yuan fell 6%. That 11% differential likely swamped the change in productivity and wages. That would translate into even greater divergence in unit labor costs.


Benjaminis

From Post 1624

 

1. Post 1,624
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4. Jan 26, 2017 6:18pm | Edited at 8:50pm

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 1,441 Posts | Online Now

Excellent USD/JPY Chart - With Notes

http://www.forexfactory.com/attachme...5&d=1485468066

Now I will paste here a post that I read just now about charts to complete my thoughts about comments on both sides of the discussion.

 

1. dukas_trader
2. | Joined Mar 2010 | Status: Member | 30 Posts | Online Now

Quoting WolGod
TRADERS FAIL BECAUSE THEY USE INDICATORS ABOUT PRICE ACTION. Past price action that means NOTHING. The only traders that make money using this crap are risk management specialists that use fibs (for discount) and do some news sentiment work. But reality is even they have no idea really and wont make much as they are too scared to trade a 5m chart. if you use the following stop. - fibs - stochs - macd - renko - gann - elliot wave - trendlines - any other lagging indicator anout PAST price action

you are joking, or?

so all trader that trade with the chart are also very stupid, because price chart is nothing more then past price action.

so with your theory you can only use macroeconomic features and economic news to trade in longterm, all other like charts you cant use for trading.....?

i have never heard someone dont use a chart, because it shows only past price action. and offcourse indicators are only price action showed in different kind - so nothing different like the chart, only different if you want so buy your calculating method.

From This Thread - http://www.forexfactory.com/showthre...08#post9487408


COMMENTS FROM BENJAMINIS: Here is the correct answer.

I have said many many times in a polite way that since most likely 75% of all Forex Traders base their plans around technical indicators that this is one and only one of the reasons, that they cannot be substantial winners or become professional Forex traders.

It is very important to use these indicators without any doubt. I could not trade without them. However they cannot be number one in the list of the five parts of successful Forex trading. Dukas Trader I see has been around here anyway since 2010 so he qualifies as having knowledge and experience trading Forex.

He also mentions news which we call fundamentals.

If a seasoned Forex Trader has Technical skills and fundamental knowledge there are still the THREE MOST IMPORTANT PARTS that She or He might or might not have. However if they do NOT have the DISCIPLINE then they cannot be successful at the level of a full time professional Forex trader such as myself.
I was not an overnight success as I started my profession during 2003.

The real reason that I only teach fellow Forex traders with a $50,000 US Dollars account is that way I can tell if they possibly have either the skills or the time to devote to learn how to trade Forex properly. That is why I asked the 12 Forex Traders that I taught to open a FXCM UK Demo Account.

Some of them dropped out very quickly. Others did not have the time to learn properly. One subscribed to my thread, then unsubscribed then subscribed then finally unsubscribed and then ignored me. I do not post this information to attack him just to make the point that he does not have the trader skills as an individual because of how he acted here.

My demo account approach always works to see if the person can be taught or not. At the other end of the scale we have KeepCalmfx who has great skills both in fundamentals and technicals and understands Risk Management and Money Flow. The most important thing that KeepCalmfx has is the work ethic and the DISCIPLINE and the integrity to be a winner trading Forex.

In this very difficult business that if approached properly can make you very very wealthy there is no short cuts to success.

The biggest problem as I see it that Forex Traders have is that they do not know any other way to trade and sometimes pays for courses or indicators always searching for the Holy Grail which does not exist. However the next best thing is to have "THE EDGE"

Then you have an opportunity if you first learn the right trading habits by trading and learning without the normal emotions of FEAR and GREED.

Risk Management that always works is the FINAL PROTECTION to not blow your Forex Trading account and on that note trading with two little capital guarantees failure. If you have the right tools and know what you are doing the MINIMUM funds that you need is $10,000 US Dollars. I have traded that and limit myself to no more than two open positions of 100 units. However today myself , I would NEVER trade Forex with less than $50,000 US Dollars as I teach here.

This has been a very long post however I think it really makes all the issues very clear as it does with the solution.

I would appreciate what you think about this summary of my thoughts on learning and winning and how to avoid failure.

Thank You


Benjaminis

From Post 1648 and Post 1649

From Post 1461

Very important summary post - from post 1421

Most traders fail because of no discipline!

I was giving much thought to my last post here and all the reasons that 95% of all Forex traders lose in this business.

The first thing that strikes me is that even if you accept that many of those reasons are accurate and apply to you which they probably do so what.

How do you overcome all of the obstacles to success ?

A Plan Of Action combined with the sentence that I started this post with. "Most traders fail because of no discipline !"

I agree with that completely however say you do have discipline as one of our better traders here surely does what do you do with that discipline ?

When we think or explain something it is natural to do this from our own life experiences and our own assumptions and experiences.

That leads me to now understand better why the excellent results achieved here since 7 weeks ago on December 3, 2016, I decided to start my thread , "Money Flow Method and Risk Management" have happened.

I always knew that I could teach Forex Traders to be successful and change their mindset and in the past I had tried on some other websites however I was not ready myself to teach properly since I also had to learn certain lessons of communication and patience.

Just like KeepCalmfx and some others have reached high levels of success since December 27, 2016 , 25 days ago , I have also learned much about how to go about being more effective in teaching and sharing information here on Forex Factory.

The whole point of my post this morning is to say that once you have made the DECISION to make trading Forex a living other than a part time way of maybe making some money you are almost guaranteed great success and wealth. However that can only happen if you have the mindset and skills to control your fears and greed and ego and to open your mind completely to trade Forex as it should be traded.

That is why I always knew that unless trading Forex was taught using a $50,000 US Funds Demo Account . I could never establish if the person that I was teaching had the DISCIPLINE and the psychological make up to become part of what I call the 5% club.

One of the most important things that you all can do here is to communicate better since every time anyone here posts we all become better at what we are trying to achieve since in the end it also is about COMMUNICATION.

On that note it would be helpful and positive for myself and all of us here whether we post much or not to offer your thoughts here to be shared with everyone how you see things after the 49 days that we have been sharing this life experience. Think about it carefully because once you realize that there is really an opportunity to become a winning Forex Trader financially then it really is all up to you.

Best regards to all,


Benjaminis

 

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4. Jan 27, 2017 5:51pm

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 1,442 Posts | Online Now

From Post 1462

My last Post For Tonight From Post 1422 - Our 4 Trade Plans !!!

Quoting mbleska
Screenshot1.png;2149784 Hi, I took a picture of trades I did last week and I added my comments about the possible problems (as mentioned in post 1420). I have learnt here that it is important to read news about what is going on in the world and try to make sense out of it (even though it takes a lot of time), then one is able to come up with a plan. The other thing is to stick to that plan and not being afraid of a loss. {image}

Actually mbleska , for the moment until you are able YOU do not have to take one minute of your time to come up with a plan.

We have until March 31, 2017 , 4 TRADE PLANS.
(1) Short US 30 - 100 units - STOP LOSS - $1000 US Dollars - Risk Reward at least 1 to 1 maybe as high as 1 to 3. Lower stops once you have minimum profit.

(2) Short USD/JPY - 100 units - STOP LOSS - $1000 US Dollars - Risk Reward at least 1 to 1 and LOWER STOPS to always lock in minimum profit of $250 US Dollars.

(3) LONG Gold - 100 Ounces - STOP LOSS - $1000 US Dollars - Risk Reward at least 1 to 1 and as High as 1 to 3.

(4) Long Silver - 5000 Ounces - STOP LOSS - S1000 US Dollars - Risk Reward at least 1 to 1 and as High as 1 to 3.

THAT IS IT !!! Just have the DISCIPLINE to do it !!!

AS FOR FEAR OF LOSS , FIRST LEARN ON YOUR $50,000 US Dollars FXCM UK Demo Account. Unless you are really really good now STOP trading Real Funds.

This is about learning good habits and getting confidence then you will trade much more effectively with your own funds and I strongly suggest a Minimum Trading Account of $10,000 US Dollars and then you can NEVER have on more than 20% of your capital or no more than 2 positions of 100 units at any one time.


Benjaminis

From Post 1661

I sense that some of our Forex Traders here might not be sure how to handle the STATUS QUO that we have at the moment in the markets.

I have been reading the EUR/USD thread and the USD/JPY thread and what I observed there is similar in both threads.

We have three types of Forex traders on Forex Factory. First there are those quite new to trading say one year or less. Then there are those with experience of one to five years and then the veterans of five years and over.

I would say that at least 75% of all Forex traders on this website are traders that use the technical indicators whether just reading the charts to going further really understanding Support and Resistance or Supply and Demand or to more specialized methods such as Pivot Points.

That type of trading was much more effective before the meltdown during 2008. Today it is not sufficient to make profits constantly and if you somehow do when we have major new events such as Brexit and the Election of a new different type of President and all the very many other complex issues out there which many on this thread are now aware about.

I have not pointed out anything new that I have not said before however I now have a new observation because of my new corporate focus on teaching people how to maybe become a professional Forex trader and not everyone can get there.

So in the EUR/USD thread you can see that the mindset is that EUR/USD is going back to 110.00 and not to 105.00 so they try to use the charts to go long and of course this confuses the issue if the TREND for EUR/USD and it most likely will be that way because of the many fundamental and Geopolitical issues.

In the USD/JPY thread not understanding about Risk On and Risk Off and Money Flow and CORRELATION they think that USD/JPY will more likely go back to 120.00 before it goes back to 110.00 or even 105..00.

CLEARLY that is not possible especially when the EQUITY markets collapse and they will.

It now becomes much more clear why those Forex Traders end up with the 95%.

However excellent Forex Traders that are more experience most likely make good profits however over 5% highly unlikely in my opinion. I could be wrong and I hope that I am since I want everyone to make money. Those kind of Forex Traders because of the great unknown ahead of us surely need a Great Risk Management Strategy.

I drew some heat in the last week or so by saying that WE had a FOOL PROOF Risk Management Strategy and I explained it then and again now by saying what it means is that it guarantees that a FOOL cannot become a professional Forex Trader.

Perhaps in our Politically correct world , I should just say instead of FOOL , a foolish person.

Please reply back and give me your own thoughts on my post and if there are other topics that you have questions on please ask me as I am around all day at my home/office doing many things while on and off the computer.


Best regards


Benjaminis

From Post 1674


COMMENTARY FROM BENJAMINIS

Part of what I do in my teaching is to try something very difficult to do.

The above information will help you understand my point of view with confirmed facts so it is much more valuable than just my opinion on the subject.

There are very few technical Forex traders that can state with 75% certainty that USD/JPY will go to 120.00 and neither can I.

However what I can do is state with zero doubt that Money Flows and Correlations will tell me what I need to know to make profits trading currencies.

Some of us here on this Forex thread that I started on December 3, 2016 already understand what I have shared on the 84 pages of information.

Most of the 24 subscribers to this thread , "Money Flow Trading Method along with Risk Management" are most likely Forex traders skilled with using all the normal charts and other enhanced methods such as Support and Resistance or and Supply and Demand or and Pivot Points.

There can be no doubt from a common sense point of view that this method of trading on it's own misleads and confuses the issue of going long or short in this case , USD/JPY.

I do not need to speculate or guess because I just let the Money Flow decide the matter for me.

Even if a human mistake is made than Risk Management protects me from substantial loss.

So in conclusion all technical information and fundamental information needs to be put into your Forex trading decisions however unless you use Money Flow Trading and Risk Management the odds of making profits are at least 90% against you. If for some reason you have found your own method of trading Forex that makes you good profits every month than fantastic.

DISCIPLINE which is the Forex traders most important asset needs to be in place in order to succeed.

Of course if you cannot learn without FEAR or GREED then you are already programmed for failure.

Finally to the the subject of EGO.

One of my best skills is that I NEVER think that I know it all because the second that I get there than I know nothing at all.

We can ALL learn from each other however if we trade with closed minds than the handwriting is already on the wall.

Have a great Sunday and a great trading week.

Best regards


Benjamin

From Post 1675 GoSlow and My Reply Post 1676

 

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4. Jan 29, 2017 12:08pm

1. http://cdn.assets.forexfactory.net/n...ar240135_1.gif TooSlow
2. Joined Mar 2012 | Status: Trader | 7,408 Posts | Online Now

Quoting BenjaminIs
There are very few technical Forex traders that can state with 75% certainty that USD/JPY will go to 120.00 and neither can I.
Certainty (a fact that is definitely true or an event that is definitely going to take place) is 100%.
Confidence is another story.
Neither is necessary for trading.
To be certain or confident is folly when it comes to trading.
Trading is adjusting to what is happening.

Attached Image
http://www.forexfactory.com/attachme...1&d=1485709691
My Threads: Trading is as simple as 1-2-3 & Highest Open/Lowest Open Trade

 

1. Post 1,676
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4. Jan 29, 2017 12:47pm

1. BenjaminIs
2. | Commercial Member | Joined Dec 2014 | 1,445 Posts | Online Now

Quoting TooSlow
{quote} Certainty (a fact that is definitely true or an event that is definitely going to take place) is 100%. Confidence is another story. Neither is necessary for trading. To be certain or confident is folly when it comes to trading. Trading is adjusting to what is happening. Bruce-Lee-Quote-Technique.jpg;2161502 {image}
TooSlow

EGO is not a good quality. I am sure that you understand what I mean.

I just happened to be coming here to my thread to post the following on the same subject that we are not together discussing with an open mind on both sides.

http://forex.today/usdjpy-h4-consoli...double-bottom/

Snippet:
I seldom trade USD pairs, but FED Yellen is speaking on Wednesday and I always trade USD when she speaks. The pair finished 2016 strongly, rallying 1,750 pips between the November 9th US elections and December 15th. But so far this year, the pair has lost 600 pips. Recent price action suggests that a near-term bottom is in place. The two swing lows between January 17th and the 24th hint at a double bottom pattern. What’s nice about this formation is that the distance from the two lows to the neckline is almost the same as the distance from the neckline to the objective.
The distance from the neckline to the double bottom is approximately 304 pips while the distance from the neckline to the measured objective is 300 pips. Watch for a H4/Daily close above the January 19th high at 115.60. Such a close would confirm the reversal pattern and expose the objective at 118.60.
USDJPY - 29 JAN 2017

- See more at: http://forex.today/usdjpy-h4-consoli....ryBiRSOp.dpuf

I will make a statement that cannot be challenged since for the moment CORRELATION is the Judge and Jury.

I cannot know what Yellen will say or do however I do not that when the DOW 30 goes back below 20,000 and reaches at least 19,500 then USD/JPY will be well below 114.00 and probably at 112.00.

So the FACT is based on the Dow 30 going down and it will when very soon however that is not my FACT.

"My Fact or CORRELATION'S FACT is when Dow 30 is at 19,500 then USD/JPY is at 114.00 or lower.


Have a great day and nice to see you post here since I am no longer permitted to post on the USD/JPY thread.


Benjaminis