I hope you all have had a successful year so far with profits dripping in and the markets going your way.
The Greenzone account has shown a stable rise ever since the beginning of the new set up , the monthly projections rising steadily and the accounts haven´t left positive equity since I can remember, on the contrary then it is just compounding profits all the time. Keeping well up with the new target of 4.5% a month since we added the extra positions to the system.
The first round of the French elections, did push us almost 3 weeks ahead of the projected target. It is situation like that, which enables us to slow down and not to stress to make profits, opening more risky positions to get to the goal, but have a smooth ride and trade when the market is more obvious.
Now the market is somehow in a limbo, with no clear direction, so we enjoy the profits from the smaller sideways ranges, which has shown to be extremely profitable all the way through.
So what is going on in the world at the moment? This weekend we had the G7 meeting, which clearly shows us that its all about showing off and being number 1 more than doing what is right for the people the politicians serve. Trump did make it quite clear that he really mean it ” America first” and did not agree to the main topic of the meeting which was climate change. So all respect for this in my opinion. Queen Merkel which are far ahead in the polls for the next election, did go out and flash her muscles and made a statement which clearly shows that she is in charge of the EU and basically financing it all. She took a stance of ” Europe first ” very much plagiating Trump. How people can keep faith in her after 12 years of ruining Germany and giving its hard earned money away is one of these things in the world which still makes me believe there are miracles. Her whole idea of now things are going to change if she gets elected ? I mean really, she already had 12 years, so why start now?
The US economy is put forward like there´s no end to prosperity. Unemployment is almost eradicated and all is just going forward. What a joke really as if you calculate the participation rate, add the people which have given up and left the job market, spicing it with people having 2 or even 3 part time jobs, then the real number should be around 20%+ unemployment. Stock markets have rallied like never before and rate hikes are hust around the corner. Well firstly then the housing market is showing off cracks, 3 more rate hikes were expected this year, now most believe in a June hike and then the next in 2018, but some are already mumbling about that the June rate hike will be postponed and the FED rather will go for QT in June instead. I am sorry but with the added geopolitical turmoil which is going on, I rather see that the US will get deeper and deeper into a recession. Also now central banks around the world, are rumored to be investing heavily in US government bonds to make things look more rosy for the US. So do we have a new Lehman brothers situation developing here? with the Central banks playing the role of Lehman?? That would mean that this time we will see states going down the drain rather than a private company, which in return then will result in nobody being able to bail them out without they too will follow the descend. So I think we have dire but interesting times ahead of us, so be careful out there.
Europe is showing off stronger figures lately and Draghi now is sweating due to the stronger Euro , but at the same time he is running out of excuses for being too dovish. Of course when the economy in Europe is getting too strong then Greece is getting more into the headlights. Really?? Greece has been bankrupt since Plato wore diapers and that is not going to change. Main export being olives and who wants to work when its 45 degrees in the summer? So put them back in the box and accept it finally. Apart from that then should the US survive another year, I still see the Euro showing more resistance. Parity is a tale of yesterday and I would be very surprised if the Euro in another 12 months wouldn´t be back trading above 1.10 with the average being around 1.16 . Also Aussie and Kiwi we should see respectively around 0.8000 and 0.7800 , fundamentally they are pretty stable both of them, we just had a weakening a week back, due to Chinas downgrade by Fitch and Moodys plus a downwards pressure in metals and oil which is slowly sorting itself out. But all in all then in a 12 month prospective I see all these 3 currencies outperforming the USD . Should the US go for a rate hike we could expect a short term strengthening but then it should start dropping again, as it did after the last 8 hikes or so.
Anyway lets see what will happen in the short term, currently the USD is setting the directions due to the lack of other triggers.
Have a great and prosperous month of June all and good luck