Risk On / Risk off Cheat sheet

[tiagifxxx]

Hi all,

Is there a cheat sheet which instruments are bullish /bearish during Risk on and Risk off?

Could not find anything here in the forum.
Thank you for your help!

[tommor]

Take a look at Dennis’s thread here for insights into the characteristics of different currencies -

Trading the Trend with Strong Weak Analysis

Hi Everyone, I have been running a popular thread in the Trade Journals forum ( same title) , and this might be a more suitable place for it. I do my own unique version of a strong weak analysis where I identify the strongest down to the weakest of the 8 major currencies, the idea being to match the strongest with the weakest and trade that pair. Combining this with good technical analysis and trading in the direction of the trend has lead me to consistent profits over the last 3 years. Thi…

But its a very long thread by now. I basically regard AUD and NZD as risk-on, CHF and JPY as risk-off, but its not a perfect fit. Other factors such as central bank interest rates also affect the relationships in pairs. AUD, NZD and CAD are sometimes called commodity currencies as the parent countries’ economies depend heavily on production and export of commodities: when industry globally is expanding this causes a rise in commodity prices, which is bullish for these currencies.

Note that CAD is heavily affected by the price of Canada’s major commodity export, oil: if the oil price rises too dramatically, this can suppress investment and consumption, which reduces demand for oil, which is bearish for CAD.

[tiagifxxx]

thanks for the gold nugget

[ponponwei]

Not exactly a cheat sheet but this might help:

Risk Off

[Thorgalis]

I check a couple of risk-on and risk-off securities everyday before the US markets open to see where we are at in regards to being risk on and risk off.

The security use every day without fail is also the AUD/JPY currency pair! Being dependent on its commodity exports, Australian economy, and its currency the Aussie Dollar is considered a risk-on currency. Because the commodities are also risk assets. JPY on the other hand is considered to be a safe haven amongst currencies. So AUD/JPY can lead as a reliable barometer of the risk in global markets at any given moment in time. Yes, CAD/JPY can also be reliable but not as much as the Aussie dollar.

Copper (Continious futures contracts) is also considered a good risk barometer globally.

How US futures contracts behave before market open during the European session is also a good barometer. US stocks overall, especially some sectors are highly associated with the risk appetite. Like tech stocks. In this regard, NASDAQ 100 futures also a good risk indicator.

Combined together, you can prepare your own cheat sheet, watchlist or dashboard for risk-on risk-off situation with the assets:

S&P 500 E-mini futures
NASDAQ 100 e-mini futures
WTI crude oil futures
Copper futures
AUDJPY
AUDCHF
CADJPY
CADCHF
SPY/TLT (stocks over bonds)
XAU/XAG (gold over silver)
HG1/GC1 (copper futures over gold futures)
HSI (Hang Seng)
VIX