Weekly Market Overview November 22, 2020Nov 22, 2020
Things are really heating up as we head in to the end of the year. The $NQ is a couple hundred points off of all time highs, Bitcoin is a couple hundred points off all time highs, Gold is a couple hundred points off all time highs.
If nothing else 2020 has been a year that has really tested our minds. If we've learned nothing else this year, we've learned that the impossible is certainly possible.
At the same time, 2020 has been an incredible year for trading.
I've been getting messages from a lot of traders asking how we possibly have been making money in this crazy market this year. They are usually citing all the news headlines, politics, CoVid, over valued tech stocks, the Fed printing money and everyone ZeroHedge'y headline.
If you've been a part of the Trading Lab or even just a subscriber to my email list you know that exactly 0% of that information goes in to how to make money in any market.
It's fun to make predictions about the market, and be right. But it's painful to make predictions about markets and be wrong, ego is a delicate thing.
This is why I am constantly focusing on categorizing market regimes and the characteristics of each regime, then matching them with the appropriate strategies.
If you need a refresher on Market Regimes have a look at this article
Let's dig right in to what we have in front of us...
- NQ (bull quiet- be long)
First of all we find ourselves smack dab in the middle of a Bull Quiet Market Regime. Bulls are in control, so while bears are showing up from time to time, their best efforts are thwarted and met with buying. Keep an eye on beautiful bearish setups showing up on the charts, only to be negated.
$NQ is also in a pretty wide trading range from about 11,000 to 12,200 more or less, or about 10% range.
In A Bull Quiet, be long, buy weakness.
I prefer to use a 3 day chart for Bitcoin as it trades 24-7, vs 24-5 like the other markets.
Bitcoin is in a Bull Quiet market regime. Like equities it's incentives are to go higher, unlike currencies, by design. So while a Bull Volatile regime would be time to consider taking profits or lightening exposure in other markets, Bitcoin doesn't trade that way. This is why it is VITALLY important to backtest every asset that you trade, to know what is possible and likely.
All measured moves up to the 18480 level are below the all time high price, our next measured move is above 23k, then 37k is next. Bitcoin will suck the oxygen out of the room, I can't say when but 6 and 7 digit Bitcoin is credible.
You can see further analysis I did on Bitcoin here
ETHUSD(ETH is the story right now suddenly)
Ethereum and the other alts have been on fire since this weekend. This is a high volatility market, indeed. Currently ETH is in Bull Quiet/Volatile (I'd lean to volatile) and has a completely different incentive system, acting more like the US Federal Reserve where it can create more ETH as needed (different than Bitcoin BTW). A new update to the network looks to fix that...finally
Gold finds itself in a Neutral market regime after trading sideways to down since August. The thing about the Gold is that this is the best market asset to trade the FVBO strategy, in Neutral, Bull Quiet and Bull Volatile, consistently putting up big numbers. You can see the FVBO setup forming likely this week.
I will be buying $GC on a FVBO setup this week
DXY (mean reversion, long dxy short others- range bound)
The DXY (dollar index) is in a bear quiet regime with major sideways action. This is a mean reversion regime, ideal for FVBO setups.
There are some Geo Political issues here that will keep us in a sideways regime for currencies (US Pairs) for a while. This is great news as the FVBO strategy is ideal for this environment...as we've been seeing in the Trading Lab!
EURUSD is in Bull Quiet but trading as neutral market regime. Trading FVBO's unless something peculiar happens
Recently I've been making a major focus on getting traders who are underfunded into Prop Trading programs, where the firm provides the trader capital and splits profits. In almost every scenario I can think of, unless you are trading over $1 Million, prop trading is the better solution.
I've gone over it in detail and will continue to. This is the best opportunities in the markets right now for traders who have a backtested strategy and risk parameters that meet the requirements to get funded.
Here's what I've been talking about
How To Get Funded In Prop (Live Trading Lab Overview and Plan)
The FVBO strategy meets all these requirements and in the Trading Lab we are live trading this strategy every day and getting traders FUNDED.
No BS, you can get millions of dollars of firm capital to trade and split the profits with them.
The two biggest factors in traders not succeeding is
- Not having a trading strategy that has been manually backtested rigorously and implemented with 95% efficiency.
- Being under capitalized.
Join us in the Trading Lab and learn the exact trading strategy, time frame and assets to trade, the proper position sizing and work with a group of live prop traders who have done it.
Later this week we will be offering a Black Friday deal to join the Trading Lab as well as discounts on the courses to learn the FVBO strategy and how to do a thorough backtest.
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