Month: April 2014

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Why I reckon the Gold Price will hit $1,425 before too long

By MoneyMorning.com.au

As far as gold goes, I would describe myself as cautiously optimistic.

Let’s not beat about the bush. I now have a target of US$1,425 an ounce and I’m hoping to see it by May. My stop is just below $1,275. If I’m wrong, I stand to lose about 30 bucks.

Several factors have led me to this target.

First, gold seems to be having one of those years where it follows the seasonal patterns. That is, a strong January with a small sell-off towards the end of the month. Then a strong February with a peak towards the end of the month, followed by a nasty March.

If this is the case, then we should see a strong April and May, before another sell-off at the end of May and into June.

If we’re about to have a strong April and May (and the signs so far are good), then last week’s March low of $1,277 should hold. That means we will have put in a higher low than the $1,180 that began the year.

Interpreting this as a small uptrend forming, I’d pitch for a higher high than the February peak of $1,392.

Which leads me to the next big level of resistance at $1,425.

However, if $1,275 doesn’t hold, then my interpretation that we’re seeing a small uptrend forming is wrong.

You’ll notice I’m taking a much shorter-term view of gold at the moment. There is a reason for this. If you asked me where gold is going to be in a couple of years, I’d find it hard to give you a strong opinion.

Without wishing to sound trite, there are so many contributing factors to the gold price that seem to be in a state of indecision. Has the US stock market peaked, or is it just catching its breath? What about the bond market – will interest rates rise, as everybody says they will — or will they fall, as they actually have done this year?  What about the dollar? It’s right in the middle of the trading range — is it going to break up or down? And the pound — is $1.67 the high, or just a temporary barrier on its way towards $2.00?

Inflation has found its way into the London housing market, as well as into financial assets. Will that inflation stay contained — or will it spread? What about next year’s general election — which way is that going?

These are all, at least in my mind, unresolved questions, which will affect British buyers of gold in some way. Even gold itself seems undecided. Are we at the start of another bull market? Are we still in a bear market? Or just meandering about on the way to nowhere?

Gold isn’t going to $2,000 this year — but I don’t see it falling below $1,000

In gold’s 1971-80 bull market, gold rose from $35 an ounce in 1971 to $200 in 1975, fell 50% back to $100, and then marched up to $850 by 1980. The gold owner in me wants to interpret the last two years as gold’s ‘75-‘76 moment. But the cynic in me won’t believe it until we see it.

I was at the (terrific) UK Investor Show last weekend, discussing the outlook for gold with various bods from the sector. Some of the panellists were excellent, I thought  — Amanda van Dyke of Women in Mining, in particular.

But another was proclaiming gold bug guff that was so generic and regurgitated that, when he declared that we will see $2,000 gold by the end of the year, my first instinct was to take the opposite stance and say gold will fall through a thousand.

Barring some extraordinary event, like some genuine numbers from China about their gold reserves, gold will not go anywhere near $2,000 this year. I’d be surprised, albeit nicely, to see it even reach $1,500 ($1,475 is my target high for the year).

However, I doubt it will fall through $1,000 either. And if it can start gently rising here, put in a series of higher lows and higher highs over the next few months, then a strong base will have been built. In the meantime, clearer trends will be becoming apparent in all those other markets I mentioned above.

I’m hoping that over the next few months we’ll have a better idea if governments and central banks really did save the economy — or if all they did was kick cans down the road. That’s a question that will determine gold’s direction and how much of it to own.

Gold’s shorter-term gyrations will give a clue as to what that answer will be. I guess, subconsciously, that’s why I am following those gyrations so closely.

Dominic Frisby
Contributing Editor, Money Morning

Ed Note: This article originally appeared in MoneyWeek.

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By MoneyMorning.com.au

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How Technology Companies Are Taking Customers From Deceptive Banks

By MoneyMorning.com.au

The US stock markets closed just a few hours ago. The Dow, NASDAQ and S&P 500 were all up over 1% each. The NASDAQ alone was up 1.72%…a good day for technology stocks. This is off the back of the minutes from the US Federal Reserve’s last meeting easing concerns of future interest rate hikes.

Bloomberg reported that, ‘Several Fed policy makers said a rise in their median projection for the main interest rate exaggerated the likely speed of tightening, according to minutes of their March 18-19 meeting released today.’

Around the world the Nikkei had a harder time of it, down 2.10%, and markets across Europe were subdued with nothing more than a few minor shifts upward. The FTSE performed the best of Europe with an upward movement of 0.68%

Back home on the ASX the All Ords moved up about a percent yesterday although Financials ex-AREITS lagged the overall market at around 0.7% in the black.

Speaking of financials, I’ve come to the conclusion that banks as we’ve known them over the last few decades have come to rely on an increasing array of obscure and potentially deceptive business practices in order to make ever great profits.

In fact today, I’d like to show you a story that proves just how far banks are willing to go keep generating fees and charges off your accounts, even when you don’t have an account anymore!. And what I’m about to explain to you is evidence that banks as you know it are a dying breed.

They’ve screwed us all too often for too long

If you ask the average man in the street, he’d probably agree with the general sentiment that with all their fees and charges, banks manage to make fat profits from their customers. At the very least, they make life harder and more complicated than it needs to be, and soon enough they’ll strangle themselves to death.

And in the wake of their failures, innovative smart financial technology companies will swoop in to take all their customers and profits. And I’ll even tell you which ones are primed to beat the banks and change the way we manage our money.

Now someone I know recently reduced two accounts with a Victorian-based bank to $0. One of those accounts was a normal everyday, savings and transaction account. The other was a credit card account with the same bank. This account balance was also $0.

Over the next couple of months both accounts had fees and charges debited from the account, subsequently putting them both into debit. The bank demanded payment for these fees, ultimately threatening to call in debt collectors.

Now here’s where it gets interesting. A sternly worded email to the bank went to the complaints department. This led to them wiping the ridiculous fees and closing both accounts. Well that was the idea…

And of course they said they would do it as a ‘gesture of good will’. Please. A gesture of good will would be not squeezing your customers to start with.

Yes one account was shut down, the credit card. However the savings account is still open. Further to this, and this is beyond belief, a brand new account has been opened in the person’s name.

Now let me make one clear point here. At no time whatsoever was authorization or approval given in any form to open this account.

So a new account, without consent or approval. In my book, that’s not right.

So there’s a few issues with all of this that clearly shows how archaic and backwards banks are.

  • The fact they charge fees on $0 balance accounts is simply astounding. Sure the fees are buried somewhere in the 24 page long Fees & Charges terms and conditions. But the fact it even exists is crazy.
  • You can keep the fees down…only if you have $2,000 pass through the account each month. That means you have to funnel all your cash to this account if you want to keep your fees low.
  • And the fact that these banks can simply open an account in your name as they see fit without your permission seems questionable, at best.

Apparently it’s the responsibility of the customer to realise when the bank is screwing them over.

And it makes me laugh when they claim they will sort it all out ‘as a gesture of goodwill’ and then go and open a new account.

The other part that defies me is the extreme difficulty in just getting two simple accounts closed…sorry, now three accounts.

But let me compare this to a couple of other banking and finance related experiences I had personally in the last few months.

How banking should be

I set up a new PayPal account this week. Now you’d think I already would have a PayPal account? Well I did. I had an Australian PayPal account.

But living in the UK means a different set of rules and regulations. So I had to shut down my Aussie PayPal and set up a new one.

Now if I decided to do that with ‘traditional’ banks, it would be a nightmare. When I first moved to the UK it was weeks of forms, emails, bank visits and headaches to set up a UK account and to transfer funds across.

But it took me all of three minutes to shut down my Aussie PayPal, and exactly three more minutes to set up, and link bank accounts and debit cards to my new UK PayPal account.

Now you might start to see my point when I say there’s a swathe of technology companies ready to steal customers from the likes of Bank of Melbourne.

Setting up a Google Wallet account is just as easy. Now although Google Wallet isn’t available in the UK yet, it’s not far off. But in the US not only can you keep your money in your Google balance you can even have a physical linked debit card to the account.

But why would you when you can simply use your smartphone to make payments?

Regardless, to set up a Google Wallet takes about the same time as a PayPal account.

But that’s not it. I also recently installed a Starbucks app on my smartphone. Now you might be thinking why the hell am I talking about a Starbucks app in a discussion on banking?

Well with my Starbucks app I can load funds onto my virtual Starbucks card. That means I can saunter down to Starbucks, and pay for my coffee through my phone. I don’t even need my wallet.

Now I’m not necessarily going to store thousands of dollars in my Starbucks app, but it’s a sign that there are companies thinking about better ways to manage money.

And it’s only a matter of time until the likes of Google becomes a fully-fledged bank. They’ll do savings, loans, investments and payments.

But it’s not just the big tech giants of Google and PayPal changing the banking landscape. There are a number of smaller start-ups gobbling up customers at great speed.

Here’s how the future of banking and finance is going to look.

I’ll keep my day-to-day transaction savings in my Google Wallet or PayPal account.

I’ll use my smartphone to pay for goods and services down the street. Instead of PayPass cards, it’ll just be a tap and go of my phone. That’s because of NFC technology.

My savings might sit in a bank like Fidor Bank, a 100% online bank. Fidor bank is different because the number of Facebook likes directly translates into the interest rate. It’s a bank for digital natives, why do they need branches? They don’t, and it reflects in the ease and community they’re building.

If I need to get a loan, I’m not going to BoM or CBA. I’m going to Zopa, where the peer-to-peer network will provide me with my lending needs. Or I might even be a lender myself, and collect interest payments from someone I’ve provided funds to.

You see innovative, and forward thinking tech companies cover every aspect of the ‘traditional bank’.

Transactions, savings, loans, currency and investments are all arms of banking that consumers can get a better deal elsewhere.

It might be PayPal or Google Wallet for day-to-day accounts. It might be Zopa or Wonga for loans. It might be CurrencyFair or Transferwise for currency exchange. These are all better, user-friendlier examples of how to manage your finances.

The point to all of this is banking and finance are under a huge pressure  to change their business model. And I’ve seen no distinct change from any of the major Australian banks.

Sure they’re investing hugely in their technology, making cool apps, and all that jazz. But they’ve missed the point. They need to change the very fabric of their business model to stay relevant.

That’s why I think CBA, ANZ, Westpac and NAB will be the most boring, underperforming financial stocks over the next ten years as the attitudes and money of retail customers begins to shift away.

The banks, the big four, will do everything they can to make life difficult for you. The harder it is, the more likely you are to give up and stay. And they’ll continue with their fees and charges, continue their underhanded ways of stealing your money from right beneath your nose.

And it’ll be these new, innovative technology companies that’ll lead us to a better way. These ‘banks’ of the future figured out if you give us what we want, make it easy, transparent and fair then you’ll have a customer for life.

Regards,
Sam Volkering+
Editor, Tech Insider

From the Port Phillip Publishing Library

Special Report: Mining Boom Act II


By MoneyMorning.com.au

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Peter Schiff Goes to Puerto Rico

By Nick Giambruno, Casey Research

It’s been a little over a year since I sat down with Peter Schiff at his house in Connecticut to discuss the importance of international diversification. Since then, the options available to take protective measures have declined in many ways, especially as the destructive FATCA law comes into force.

While some doors have closed, others have opened. And perhaps one of the most significant new opportunities in the world today is the tax incentives in Puerto Rico.

In fact, Alex Daley and Louis James, two of my Casey Research colleagues, have already moved to Puerto Rico to take advantage of the tropical weather and low taxes.

Peter Schiff is also moving there. He has already moved one of his businesses there and plans to move personally sometime in the future.

It’s not an exaggeration to say that these new incentives in Puerto Rico have been life-changing.

Any American looking for relief from the suffocating burden of ever-increasing taxation should seriously look into the Puerto Rico option.

Peter and I discuss it in detail below. You won’t want to miss this fascinating discussion.

But first, I’d encourage you to check out the fully revised and updated version of Peter’s book The Real Crash, which just hit the shelves. It’s a must read if you want to understand the economic abyss that is staring the US in the face.

And now to our discussion on the stunning tax benefits of Puerto Rico.

Nick Giambruno: Peter, tell us about your take on the situation in Puerto Rico and some of the opportunities it offers.

Peter Schiff: The Puerto Rican situation is actually quite appealing for Americans who own businesses because the way they have reformed their tax law is very favorable to businesses that are generating their income out of Puerto Rico—Puerto Rican-sourced income.

So if you are doing something, if you go to Puerto Rico and do it—if you incorporate a business in Puerto Rico and operate your business from Puerto Rico—the tax treatment is very favorable. You basically pay a 4% effective tax rate.

If you incorporate in Puerto Rico, that corporation enjoys a 4% tax rate even if you yourself are not living in Puerto Rico, which is much better than being in the states, where it is subject to a 35% tax rate federally and then some. Depending on which state it might be incorporated in, you’d have another layer of corporate tax, so clearly you’re at a competitive advantage if you’re operating a business out of Puerto Rico. And you’ll also find that the cost of doing business—the labor costs and the rental costs—are going to be lower in Puerto Rico than the 50 states.

So you can move over there, you can operate a business at a lower cost, and you can keep a lot more of what you earn, which effectively is like a reduction in cost because you don’t have to make as much money. In the US, in order to generate a dollar of profit, you pretty much have to generate almost two pretax dollars to get a dollar after tax, whereas in Puerto Rico, you can get a dollar of after-tax profit by generating only $1.04.

Nick: So what makes Puerto Rico different than other low-tax jurisdictions like the Cayman Islands?

Peter: Well, the Cayman Islands is not part of the US. You can incorporate in the Caymans and you can enjoy a very low, maybe even a zero rate of tax. But the difference for an American is huge in that if you run a business in the Cayman Islands on the corporate level and you pay no taxes, as the owner of that business, if you want to enjoy the fruits of the profits, if you want to pay yourself a dividend or if you want to move to the Caymans and pay yourself a salary, all of that is going to be subject to US income tax. Even though the Caymans doesn’t impose an income tax, America still does. Now, if you are Canadian or German or anybody else, then it doesn’t really matter. You can move to the Cayman Islands and live a tax-free life.

But you can’t do that as an American citizen, because the US government says, “Uh-uh; we don’t care where you go on this planet.” In fact, they probably don’t care where you go in the universe. Wherever you are, if you’re earning money, the US government wants its cut.

But if you go to Puerto Rico, they don’t take a cut, and that is what is unique, because there is a tax treaty between the United States Government and Puerto Rico as part of the terms of the territorial agreement that we have with Puerto Rico. It says that if you’re an American citizen living in Puerto Rico, working in Puerto Rico, that the income that you earn while you were there is not subject to any US income tax.

Nick: I think that’s the one point that needs to be emphasized. Americans can find these kind of benefits nowhere else in the world because of the system of citizenship-based taxation which no other country effectively imposes on their citizens. So for Americans, Puerto Rico really is the only escape hatch for this kind of tax relief short of renouncing your US citizenship.

Peter: If you’re a Canadian, you can pretty much go to any of the tax havens all around the world—it doesn’t really matter, you can take your pick—but if you’re an American, you really don’t have a choice. It’s Puerto Rico, or that’s it.

Nick: What’s the situation with your company in Puerto Rico?

Peter: So far, I’ve moved one company there, which is my asset management company, Euro Pacific Asset Management. It used to be based in Newport Beach, California. So the immediate benefit to my company from that move is that the tax goes down from the tax in California, the marginal tax is upwards of 50% when you combine the state income tax with the federal income tax, so my income tax liability goes down by upwards of 90%.

Also, the office space I’ve leased in San Juan is considerably cheaper than the office space that I leased in Newport Beach, so my rent is lower.

I have four employees who have since relocated there. They’re still working from home until they get the office fully ready, but once it is up and we do hire some local Puerto Rican labor, I am sure that we will be able to hire somebody working in Puerto Rico, clerical-type work that will be a lot less expensive than what we were paying for that kind of work in California.

So the labor cost will be lower, the taxes will be lower, so it’s just a lowering overall of the operating expenses of the company, and of course, you know the plan for me—I am ultimately planning on moving there.

Nick: Yes, it’s also individuals who can directly benefit. You have the two laws, Act 20 and Act 22. One pertains to service businesses and the other pertains to individual investors. So when you move to Puerto Rico, tell us about the kind of benefits you can get.

Peter: Once I officially move to Puerto Rico, then I can get tax-free dividends on Puerto Rican-sourced income, which would include my business that has moved to Puerto Rico.

I can also make investments in the stock market and enjoy zero capital gains tax. Right now, living in America, if I buy 100 shares of IBM at $100 and sell it at $110, I have a $10 capital gain. There’s a tax rate if it’s short-term, it’s higher than the long-term rate. But once I move to Puerto Rico, I can trade IBM as often as I want, and no matter how much money I make, I pay zero capital gain taxes in Puerto Rico, and I pay zero capital gain taxes in the United States.

And any other businesses that I operate—you know, I do my radio show and right now, it really doesn’t generate much of a profit, but to the extent that it was able to generate a profit, I won’t pay any taxes if I’m doing it out of a studio in Puerto Rico as opposed to in the US.

So pretty much anything that you can do via the Internet, via the telephone, if you do it from Puerto Rico, you’re going to hardly pay any income tax, which is kind of the way it used to be in America. It’s kind of like turning back the clock to the olden days, when you got to keep what you earned, where you really were free, when you didn’t pay a lot of tax, and that’s the way it is now. If you want to move to Puerto Rico, you can reclaim the freedom that was once enjoyed here on the mainland by our great-grandparents.

Nick: Yeah, it’s really an amazing opportunity. Isn’t Puerto Rico in many ways perfectly suited for American startups and entrepreneurs?

Peter: If you can start up a company, do it from Puerto Rico—especially if it’s an online company. Then in a few years you can turn around and sell it for $5 million or $10 million or $20 million.

Let’s say you sell your business for $5 million. That’s a lot of money, but after taxes you’re left with $3 million. But if you do it in Puerto Rico, you get to keep the whole thing. So that could be a big difference.

Let’s say you’re operating a business from the US right now, but it’s small—maybe it’s an online company or whatever you’re doing and maybe you’re earning $500,000 a year—and that’s all you’re earning, and by the time you finished paying all your taxes, you’re left with $250,000 a year. Well, if you decide to move to Puerto Rico, your income would probably be more like $450,000 a year, so you’d give yourself a $200,000 a year raise, and your overhead expenses would be lower and you’d also reduce your cost of living.

So it’s a big, big difference, and especially if you compound it over years. Because you just don’t have that savings one year, you have it year after year. And now you have that extra money that you didn’t pay in taxes—you can then take that money and invest it. And now those returns are going to compound tax-free.

So if you think about it from an ability to retire—when can you retire and how much income can you have in your retirement savings—it’s so much easier, because all the checks that you would have written to the IRS you can now invest it and compound the returns tax-free.

Nick: So what do you say to the skeptics? Are you afraid the US government could force Puerto Rico to change, or the incentives could otherwise disappear?

Peter: Well, the incentives aren’t going to disappear because they’re working. Puerto Rico is already benefiting from a lot of people moving to the island, setting up businesses on the island, and so this benefits Puerto Rico because this is tax revenue they never would have received. Four percent of something is better than 50% of nothing, and in addition, when these businesses are moving to Puerto Rico, they hire people, they spend money, and they do other things that impact the local economy where the government does collect additional tax revenue. So it’s nothing but a plus for Puerto Rico; they would have no reason to end this.

Plus when you go down there they write a contract with you. So even if they end it in the future, if you’re already there, you’re locked in until 2035. So no matter what they do, once they approve your status, you’ve got a guaranteed zero-tax situation until 2035, which is another value—tax certainty.

I mean, who knows what the income tax is going to be in the United States? You have no idea how much they might jack it up in the future. At least if you live in Puerto Rico, you know what it’s going to be until 2035—and for a lot of people, that’s beyond their life expectancy. That’s a nice certainty to have.

Nick: What about the US federal government?

Peter: Puerto Rico needs to do something. The economy is in a lot of trouble—they have a lot of debt. I mean, what else can Puerto Rico do to try to improve their economy but try to expand their tax base?

So I don’t know that the US is going to try to put pressure on Puerto Rico to end something that’s actually working for Puerto Rico, unless the US government is willing to come up with a lot of cash for Puerto Rico. If the US loses a few billion dollars a year in tax revenue, well, that might be politically better than having to spend a few billion dollars in bailout money.

If Puerto Rico had simply taken this particular policy position 20, 30 years ago, Puerto Rico would now be like Singapore or the Cayman Islands.

Nick: So what areas of the island do you like personally from a lifestyle standpoint?

Peter: I bought a condominium personally in an area of Dorado Beach. And I’m in the Ritz Carlton Reserve, which just built a spectacular resort in Dorado Beach. It’s part of a larger community, which is gated and has lots of private homes that share the Dorado Beach Club, which is the beach and four 18-hole golf courses, and it’s just a beautiful community. Around the community there’s lots of stores, there’s really good private schools, English private schools; so for people who have families and want to relocate, I think it’s very family friendly. You see kids at night walking around, riding their bikes to each other’s houses, you don’t have to lock your doors; it’s a very, very safe, beautiful community. And of course, you’ve got great weather. So if you like the water, if you like sailing and scuba diving and playing golf, and tennis and stuff like that, it’s a nice place to be.

There’s also a big city, so if you’re young and single you can be in the San Juan area. I mean, it’s not like a remote little island—there’s a vibrant urban population there. There’s stuff going on, there’s a vibe to the place.

So when you have a vacation you can go to New York, or you can go to London or Paris, you can go to a show, you can see a play, you can go to the symphony, you can see a museum. That’s your vacation. Your normal life is what everybody else’s vacation is.

There are people who try to retire to Arizona or Florida, but they are still subject to federal income taxes. Even in Florida where there’s no state income tax, there’s still the federal income tax which is pretty high. You’ve got guys like Rick Perry in Texas trying to convince businesses to move to Texas because they have no state income tax, but they still have the federal income tax. Puerto Rico can out-Texas Texas, they can out-Florida Florida. I mean, nobody has what they have to offer, which is exemption from the US federal income tax.

And that is the big enchilada—not only what the US income tax is today, which is 39% plus the Obamacare, so it’s about 44%, but who knows what it’s going to be? What if Hillary Clinton is the next president and we’re still in recession; and what if Hillary says, we need another tax bracket, maybe we have to go to a 60% or 70% tax bracket?

Nick: Peter, I know you’re a busy guy. I appreciate you taking the time to explain to our readers this exciting and unique opportunity and wish you the best on your endeavors in Puerto Rico.

Editor’s Note: Puerto Rico’s Stunning New Tax Advantages is the authoritative guide on the Puerto Rico option. It’s been reviewed by dozens of professional sources in Puerto Rico and the mainland US, including top law firms and accountants. It’s an A-Z guide with information you won’t find anywhere else. If you’re considering taking advantage of these incentives, get started with this guide. It will save you a lot of time and money in the process. Click here to learn more.

The article Peter Schiff Goes to Puerto Rico was originally published at internationalman.com.
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Pin Bar Entry and Exit Strategies

Before we get into all the juicy details about pin bar entry and exit strategies, we need to discuss a very important subject, the Risk reward ratio. Please do not skip ahead because the pin bar entry and exit strategies we’re going to cover in this lesson won’t make much sense without understanding risk reward ratio. Not only that, but the proper risk reward ratio is critical if you want to succeed as a Forex trader. I truly believe that this is the missing link for many traders who are struggling.

Risk Reward Ratiorisk reward ratio of pin bar setups

So what is a “risk reward ratio”? A risk reward ratio is simply the amount of capital risked to achieve a desired gain. Because it’s a ratio we represent it as follows:

1:2 (in this case the “1” is our risk and the “2” is our reward) An example would be risking $50 for a potential gain of $100. Let’s look at another way to represent the risk reward ratio.

R-Multiple

Don’t worry, it isn’t as scary as it sounds. The R-multiple is simply the ratio converted to a multiple. So in the case of our example above, the 1:2 ratio becomes 2R. Let’s covert a few more before moving on.

1:3 becomes 3R
1:2.5 becomes 2.5R
1:3.52487 becomes 3.52487R  …I couldn’t help myself 😉

We’re essentially just placing an “R” after the second number (reward) in the risk reward ratio. Because the risk is always represented as the number one, the reward will always be divisible by itself. It’s just an easier way to represent the risk reward ratio. Not so scary anymore, huh?

The reason I mentioned that the proper risk reward ratio, or R-multiple as we now know it, is critical to your success is because it allows you to have more losers than winners and still come out ahead. How is that possible? By maintaining a 2R minimum per trade, which is how I trade and what I teach in my Forex trading course. If you maintained a 2R average, you could actually lose 65% of your trades and still come out ahead.

Now that we understand R-multiples and the benefit of maintaining a 2R minimum, let’s get into pin bar entry strategies. The rest of this lesson will assume that we have already gone through our confluence checklist and are now ready to place the trade.

More: Pin Bar Entry and Exit Strategies

Justin Bennett is a full-time Forex trader and Owner of Daily Price Action. His Forex trading career began 6 years ago and has followed a path similar to many traders. For the first 3 years he tried nearly every indicator and strategy known to man, but each time the journey ended where it began, frustrated and in search of the next “holy grail” that would bring consistent profits. It wasn’t until he cleared every indicator from his chart that he had his “ah ha” moment. For the past 3 years, Justin has worked to perfect that moment into something that can be easily duplicated by other traders in search of consistent profits.

 

 

 

 

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Commodities soar across the board; Outlook on Gold, Silver and Crude Oil

Commodities climb higher as the USD weakens following the FOCM Minutes, maintaining the bullish trends set earlier this week.

Gold crosses above $1306.60 pivot

After an intraday double top around $1314 and a dip below the small pivot zone at $1306.60, Gold proceeded to test the major handle at $1300 and reversed in this area. The configuration of the trend is bullish, with higher highs and higher lows; consequently a rally above $1314 is expected next.
Gold 9th April
Resistance levels: $1317; $1321; $1334
Support levels: $1306.6; $1300; $1294

Silver rebounds from $19.60 support

After a slow bullish consolidation that ended around $21.21, Silver couldn’t cross above 100 Simple Moving Average (on both Daily and 4H timeframes). Today the pair fell towards the original support and bounced several cents away from it, at $19.60. A strong close above $19.90-$20.00 area leads to the formation of a bullish Pin bar price action pattern on the Daily chart, which suggests more bullish action come tomorrow, if $20.21 fails to act as resistance again.

Silver 9th April

Resistance levels: $20.02 (green line – 100 Moving Average); $20.21; $20.59.
Support levels: $19.56; $19.11; $18.64

Crude Oil heads towards $105.00 – $105.20

Sweet Crude Oil Futures for delivery in May broke outside the triangle chart pattern yesterday around $101.30. Within hours price was already stable above the previous high at $102.21. The rally continued today without any corrections. Current daily high is $103.74. Before price heads towards $105 – $105.20 resistance, a re-test of the previous support at $102.21 is not excluded, with the level turning into support this time.

Crude Oil

Resistance levels: $104.15, $105.00; $105.20.
Support levels: $102.21; $100.18, $98.85.

*********
Prepared by Alexandru Z., Chief Currency Strategist at Capital Trust Markets

 

 

 

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EURUSD: Bullish But Hesitates Ahead Of 1.3820 Level.

EURUSD: Although EUR is bullish, it is now seen hesitating ahead of its key resistance located at the 1.3820 level. Unless it decisive breaks and holds above that level, the risk is for it to trigger a pullback lower. However, above here will turn focus to the 1.3900 level. Further out, resistance comes in at the 1.3966 level where a breach will aim at the 1.4000 level. Its daily RSI is bullish and pointing higher supporting this view. On the downside, the risk to this analysis will be a return to the 1.3737 level followed by the 1.3676 level. Further down, support stands at the 1.3600 level where a violation will target the 1.3550 level. All in all, EUR remains biased to the upside in the long term though hesitating.

Article by www.fxtechstrategy.com

 

 

 

 

 

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Poland on hold, repeats steady rate at least until end-Q3

By CentralBankNews.info
    Poland’s central bank maintained its reference rate at 2.50 percent, as widely expected, and reiterated that “interest rates should be kept unchanged for a longer period of time, i.e. at least until the end of the third quarter of 2014.”
    Last month the National Bank of Poland (NBP) pushed back the time frame for any rate change until the end of the third quarter of this year from its previous guidance of maintaining rates at least until the end of the second quarter.
    “In the opinion of the Council, gradual economic recovery is likely to continue in the coming quarters, however, inflationary pressures will remain subdued,” said the central bank which cut its rate by a total of 225 basis points from November 2012 through July 2013.
    Poland’s headline inflation rate rose to 0.7 percent in February from January’s 0.5 percent, but the NBP said it remained “markedly below” the bank’s 2.5 percent target, plus/minus one percentage point.
    It added that core inflation was also at a low level, producer prices declined further and inflation expectations are low.
    In its latest monetary policy report, the central bank forecast inflation in 2014 of 0.8 percent to 1.4 percent and 2015 inflation of 1.0 to 2.6 percent. The International Monetary Fund (IMF) this week forecast 2014 inflation of 1.5 percent and 2.4 percent in 2015 compared with 2013’s 0.9 percent.

     The latest economic data show that Poland’s economic recovery is continuing, with the central bank saying growth in industrial output and retail sales has accelerated in the first months and in February construction and assembly output also rose.
    The recovery is gradually being transmitted to the labour market, though the unemployment rate remains at an elevated level which restricts wage growth. Poland’s unemployment rate eased to 13.6 percent in February, the second month of declining joblessness.
    Poland’s Gross Domestic Product rose by 0.6 percent in fourth quarter from third quarter for annual growth of 2.7 percent, up from 1.9 percent in third quarter and the third quarter of accelerating growth.
    The NBP forecasts growth this year of 2.9 to 4.2 percent, up from 2013’s 1.6 percent, and 2.7 to 4.8 percent in 2015. The IMF projects 2014 growth of 3.1 percent and 3.3 percent in 2015.

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EUR/GBP remains in bearish territory after Trade Balance reports

The British Pound maintains a positive sentiment against the Euro currency, after UK trade deficit narrowed to 9.094 billion in February from 9.463 billion pounds in January. German Trade Balance came out at 15.7B, lower than the expected 18.0B.

EUR/GBP is expected to slowly drift lower towards 0.8200 until tomorrow, when volatility will increase surrounding GBP Asset Purchase Facility, BOE Official Bank Rate statement, MPC Rate Statement and the G20 Meeting.

Technical Analysis

EUR/GBP 4H Chart

Until this week EUR/GBP was respecting the 61.8% Fibonacci retracement between 0.8157 and 0.84000. While bullish rejections have been restricted around 8.3000/10 and the 50 moving average on the 4H timeframe, the bullish scenarios remained intact as long as the pair didn’t close below the 0.8250.

0.8250 has turned into resistance, as price tested the level again from below. A secondary resistance is the 50 Simple Moving Average on 4H, currently at 0.8266, as price seems to respect it very well for this bearish moving.

This recent weakness suggests EUR/GBP will eventually target 100% down to 0.8157. Even so, the intermediary level between 0.8190-0.8200 can pose a problem and offer a decent support in the next trading sessions.

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Prepared by Alexandru Z., Chief Currency Strategist at Capital Trust Markets

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USDCHF Elliott Wave Analysis: Bearish Wave In Action

USDCHF fell to a new low of the year in February so market remains in bearish mode as long as 0.9080 swing high is not breached; but the question is for how long. We are looking at an ending diagonal in wave C that suggests a coming bullish reversal sometime this year, most likely in the second part of 2014. On the chart we are tracking wave (5), final leg in the pattern that may find a support at 0.8450-0.8550 area. A rise back above 0.9080 would suggest a bullish turning point.

USDCHF Daily Elliott Wave Analysis

USDCHF Four Hour

USDCHF has turned nicely to the downside since Friday, clearly in impulsive manner. Notice that market also retraced back to the area of wave B swing low after a broken support line of an upward channel. That’s a very strong and important evidence for a trend change, thus it suggests that top has been formed at 0.8951 and that market will continue to the downside after any short-term corrective bounce. Ideally we will see a wave 2 retracement back to 0.8870/90 where broken support line may not become a resistance.

USDCHF 4h Elliott Wave Analysis

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Gold Climbs Near Two-Week High; Fed Minutes in Focus

By HY Markets Forex Blog

Gold futures were seen trading higher on Wednesday, climbing towards a two-week high before the release of the US Federal Reserve minutes from the Fed’s March meeting  which is scheduled for release later in the day and expected to give a hint on the central bank’s monetary policy.

Meanwhile the recent developments in Ukraine increased the metal’s safe-haven status and signs of high demand in China boosted the metal.

Gold futures climbed 0.22% higher to $1312.10 an ounce at the time of writing on the New York Comex, the highest since March 26.While silver futures traded flat, edging 0.01% higher to $20.055 an ounce at the same time.

Gold- Fed Minutes

Following the Federal Reserve’s March 18-19 meeting, Fed Chair Janet Yellen said the US central bank might increase the benchmark interest rate in the next six months before the end of the asset-purchasing program, which is expected to end later in the year.

The US central bank reduced its monthly bond-purchases by $10 billion for the third time, leaving the purchases at $55 billion.

The yellow metal dropped by 28% last year on worries that the world’s largest economy grew, which would signify the end of monetary stimulus.

Weak Dollar

“Through this past session, spot gold managed a 0.9% advance with a modest uptick in derivative volume (ETFs and futures) yet, the lack of momentum and turnover still calls into question the conviction,” John Kicklighter, chief strategist at FXCM wrote in a note.

“It further begs the question: what percentage of this performance was gold’s innate strength versus the dollar’s universal weakness. When we price the metal in Yen, Australian dollars, euro, pounds or other currencies; its performance was either negative or unchanged. While gold may be an anti-dollar commodity, there are plenty of other currencies that will attract the capital first,” Kicklighter added.

The US dollar index, which measures the strength of the US dollar against a basket of six major currencies, edged 0.06% higher at 79.8 points, below the 80-point level and the lowest since March 18.

Assets in the world’s largest gold-backed ETF, SPDR Holdings; dropped 2.7 tons to 806.48 tons Tuesday, the lowest since March 7.

Meanwhile, ongoing tension between Russia and Ukraine over the annexed Black Sea Crimea peninsula continues as NATO issued another warning against Russia that any further intervention in Ukraine would cause tougher consequences.

According to the International Monetary Fund (IMF), Russia’s growth this year is expected to be restrained due to the ongoing tensions with Ukraine and could cause further damage if sanctions against the country build up.

 

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