Tradeneophytes soap box - Trading, and other things too

Trading Discussion Trading Lifestyle
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First order of business, my apologies to the few BUT loyal readers I have on www.Tradeneophytes.com

If you’re wondering why I am posting even less than before it’s not because I have given up, but because I am working on a totally new project - my cat business - which could be a nice little money-spinner for me.

I hate not posting on my blog, I feel I am letting readers down, but this business idea of mine has such potential bang for the buck I have no choice.

If you are a cat lover, you may just love my new website and related social media. If you hate cats, then soon enough I am going to be putting up some killer new content on the trading blog.

Crypto comp winner

Okay, with that out the way, I recently won the babypips competition for the best advice on crypto. For the record, I still don’t really get the crypto space and see much of it similar to the Mississippi scheme or South Sea Bubble.

I am paraphrasing here, but there was one company that floated at that time that wanted investors to put money into a venture that was to not tell investors what they were speculating in.

Hmm - a bit like some of the current altcoins.

Anyway, I won the competition but soon figured out Amazon has more than one company, and I couldn’t use my winnings on the UK site.

I figured it out eventually but be warned non-US residents - if you win the competition in the future you will have to switch the accounts to use the voucher.

Geopolitics

Crazy shi* has been happening geopolitically as you probably know. I am talking about the fall of Kabul, and quite literally the falling out of the plane of a number of poor Afghans.

The fall of Kabul is major news and if you do not know about it, then you really have no business trading markets.

I am not going to get into partisan politics, I left the political discussion here on babypips because there were far too many echo chambers which I don’t think add to proper trading.

However, the Kabul fiasco has wider importance - not just because of potential new terrorist activity. More because of the potential for China to really start ramping up the rhetoric on Taiwan.

China is very very likely to play a game of chicken with the now weakened Biden administration, which is likely to have a major effect on the markets.

I have an active interest in this region, a couple of centuries ago my descendants left Fukkien province (directly opposite Taiwan), traveling south to Malaysia - they were the economic migrants of the day and left that strip of coast in their millions.

Mainland China has every intention of correcting what they perceive to be a century of humiliation at the hand of foreign powers.

And Taiwan, the Spratlys, and dominance of the South China Sea is part of their plan to correct this humiliation

I would honestly say the biggest issue facing the world today is not climate change, not a disputed US election, not even the Middle East.

It is the South China Sea.

This article from Zerohedge makes for sober reading.

You would think all this would be good for gold, it may who knows. But being long gold is lazy thinking, and as a trader of gold for many years now I know that nothing disappoints quite like the Ancient Metal of Kings.

I fully expect the dollar to be the biggest beneficiary in the event of an event in the South China Sea or Taiwan.

The Art of Currency Trading

With my winnings from the babypips comp as I said at the time I bought the above title. I said I would write a review of the book for us here.

Well, I am going to go one better. Between here and my blog I am going to spend some time writing about the concepts, and strategies in its pages - when my cat website is finished that is.

I am going to use this thread, really just to discuss anything I feel is relevant to making us all better traders.

However, I have never been big on discussing individual strategies, I leave that to others much better at it than me like @MattyMoney - there are others too.

My technical analysis analysis would make for boring reading indeed. It would be like… buy if it goes above this line, cancel the order if it doesn’t.

I will discuss a bit about the trader lifestyle though, and what mental frames you need to succeed at trading.

And of course, any new blog posts over at Tradeneophytes I will also shamelessly plug.

Take care

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There is much talk about getting your ‘psychology’ right in trading. That is a fine goal, and no doubt will improve your trading results.

But it’s not likely to happen if all you want to do is get it sorted in regards to trading but not in other parts of your life.

I am a firm believer that how you do or approach one thing is how you approach everything else. So, the only way to sort your ‘trading psychology’ out is to sort YOU out.

Many of you probably care little for your own self-development outside of trading, all you want to do is find the quickest way to get your Lear Jet or bling it up with supermodels.

It’s, give me a strategy now, and hopefully, it will make you rich.

Well unfortunately trading and life don’t work that way.

I believe it was Ed Seykota who said that trading is the ultimate psychotherapy.

And he was correct – you have to dig deep, in those dark places in your psyche you really might not want to go.

Most of you probably don’t know of Manly P Hall – but if there was one trading routine I perform daily it’s to listen or read some of the lectures or writings of this most amazing man.

Much of what he writes is beyond psychology and has no real place on a trading forum, however, there are some real gems occasionally that fit perfectly with our quest to be more whole individuals - and ultimately better traders. This is one such lecture.

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I believe this is true due to your core belief system. Everything you do comes from your belief system. It’s your life compas.

If you love partying and spending money, and it’s your top priority, your choices will be based on that belief system. You will mostly choose partying over studying/practicing your art or investment.

But if you change your core belief system, you’ll start to make better decisions and yield better results.

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I see trading as a performance discipline. You have to keep yourself at least a bit in shape mentally and physically for peak performance

The amount of times I’ve lost money because of a ‘torpid liver’ (Jesse Livermore’s words) where my mind was anxious and did the wrong thing are many

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Dr David Paul said it’s often the string of wins that alters people’s minds and makes them trade wrecklessly.

I’ve done. I had one or two nice wins, and bam! Gave it all back to the market.

Just as noted in Disciplined Trader.

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Could a debt default of Evergrande lead to a new financial crisis? If so - probably dollar bullish.

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Could we be about to experience a major upleg in the dollar?

Last time round with the Lehman collapse the dollar rallied hard and safe havens like “gold” fell off a cliff.

Interesting to see what that ever so safe haven asset ‘bitcoin’ would do under such a scenario.

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Interesting to see silver get pummeled, gold sell off as the dollar has a big up move.

The start of things to come perhaps, as investors start to realise that the issues with Evergrande are going to have a ripple effect across global markets - I think.

First time in ages I’ve been long the dollar - I missed the mega rally in the dollar during the great financial crisis - because I was married to my opinion that precious metals were going to da moon.

But I’m not going to miss this one, if things do play out the way I think that is.

Interestingly bitcoin sell off was minor - maybe it is a safe haven after all - lol

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Hi @Johnscott31,

Thanks for focussing my attention on one of my most delightful pursuits - long term gold and silver. If it gets to under $20 I will be looking to buy. Or trade on the GSR ratio if I deem it particularly interesting and trending.

Silver 16Sep21
Silver 16Sep211114×716 67.9 KB

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Well if we are about to experience a Lehamns style event (and that’s not certain) then silver is going to get a whole lot cheaper relative to gold.

I remember all too well the financial crisis - I was long silver all the way up to $49 and then all the way back to down to around $19.

I kept saying to myself the markets are wrong - gold and silver should be exploding, instead they were imploding - and the dollar was the main beneficiary.

That is why I am so wary these days, of dogmatic belief in any market be it gold, silver or bitcoin.

Of course they say an old general always fights his last war, and I do expect things to be slightly different this time - but one thing is a cert, in the short term at least investors are going to be closing out any carry trades, raising capital (buying selling gold and silver) and bringing dollars back home.

I do stress though that now we have bitcoin, and it will be really interesting to see how it handles all this.

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I’m wondering if the speculation around the CCP coming to Evergrande’s rescue will hold true. Super interested to see how the CCP handles this situation.

I think they said the same thing about Lehman’s too but in this instance wondering if things will turn out differently.

The CCP is very afraid of showing any perceived weakness I believe, especially among it’s own people, which explains the ramped nationalistic rhetoric and social media outrage with it’s neighbours. I think letting Evergrande fail will be a huge blow to that perceived image but is that enough to take care of the $300B+ in liabilities?

Maybe they do something innovative like “redistribute” capital from other sectors to take care of the liabilities? This is more like an unsubstantiated conspiracy theory though.

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@darthdimsky

Yes - as an avid China watcher this is going to prove really interesting.

And you are spot on with your point about the CCP. So far they have said little.

It really could come down to a game of chicken with the CCP facing off against potential civil unrest, the Chinese economy, and the world’s financial markets

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This video is really detailed and appears to go to great lengths in it’s investigation. Implies accurate translation of all those docs they used as evidence. Recently felt that this channel and “China Uncensored” had an extremely high anti-China bias but it’s hard to dispute it when it puts up all those docs and numbers.

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Saw two news items that’s only stoking the fire with China atm. One’s the nuclear submarine deal that Australia’s inked with the US & UK

Read in another article that China expressed outrage at this deal and wondered why to read that AU had diesel subs ordered from France, only to cancel it and order nuclear subs instead, in light of the increased activity by CN in the South China Sea.

The other one was the “Quad” countries in talks to secure a more robust supply microchip supply chain

The “Quad” was drafted to work together during the Trump administration but never really got a lot of ground because one or two countries deferred to their national interests more. So that envisioned consolidate approach never really took off, to the best of my limited knowledge. So seeing this headline rang a few alarm bells.

While China has no one else to blame but itself for giving a lot of incentive for these actions I can’t help feel a bit worried that these actions just isolate it a lot more in the world stage and that, to me, is very dangerous.

In the case of the US atleast there are other super powers to call them idiots if push comes to shove and a system that doesn’t discourage civilian protest to keep certain actions in check. With China there’s no similar mechanism. Russia is perhaps the only other super power that might have China’s ear but even their relationship is contentious at times I believe.

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Don’t really know too much about the nuclear sub thing, other than the fact the French are pissed. I am assuming that there were always going to be deals of all kinds made the moment the Brits left the EU. Also far from a purely markets perspective I have no clue how I would make money of such a geopolitical theme.

However, the semiconductor thing is interesting. I’ve made a fair bit trading in and out of NVIDIA over the past year or so - and the semiconductor shortage doesn’t appear to be going away anytime soon. Its something I am very interested in.

I will look at both stories - however, the thought of reading anything in the Guardian fills me with dread - I guess metropolitan Guardian readers would call me a deplorable or white van man. It’s always a tough read for me, but I do try to get out of my own echo chamber occasionally - lol

Thanks

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Oops. Didn’t know it was politically biased. I’m not well-versed with left/right leaning papers in the UK. The article is very detailed though, which is why I read through it. I initially read a bulletin from Reuters. There must be other news sources where this detailed just as well maybe.

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Lol

I actually think the writing in the Guardian is well put together, edited, and designed. However, they were particularly partisan during the Brexit debate which kind of left a sour taste in many a Brexiteers mouth.

However, this thread is not a political one, only in as much as how can we profit from the political decisions made.

I was ribbing you a bit about it - that’s all.

In all seriousness though I do think we are entering into a new cold war esque period. In geopolitical parlance it’s known as the Thucydides trap - and I don’t think it can be avoided.

The Chinese and the US are poles apart when it comes to their thinking - the ability to step into each other’s shoes is simply not present.

In my very first post on this thread, I said that due to US weakness and division China would ramp up the rhetoric on Taiwan - which they have.

And even NK have started firing missiles again.

I only see this continuing and at some point a full-on takeover of Taiwan - who is going to stop them? Who stopped them after the takeover of the Spratleys was deemed illegal in international law?

Which I guess brings us back to Evergrande - I wouldn’t be surprised by major fireworks when the markets open Monday.

Obviously, a full-on rout of the China economy might set back their global ambitions for a while.

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LOL, you are now one of my favourites on this forum. Love it. You could be called worse than white van man too. :rofl:

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