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CFDs come with a high risk of losing money rapidly due to leverage. 71% of accounts lose money when trading CFDs with this provider. You should understand how CFDs work and consider if you can take the risk of losing your money.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

71% of retail investor accounts lose money when trading CFDs with this provider.

Market Insights

Trading insights: Season of change seen in current price action

Copy of Blog Images - Skilling - 2023-08-22T131518.350

Market Talk:

Which way is the wind blowing?

Indeed at the moment it’s not “easy” trading conditions, increased volatility across many parts of the financial markets could be because traders and investors do not know which way the “wind” is blowing?

Recent volatility indices last 5 days:

*Data tradingview 22/8/23 8:55 UTC *

How to navigate choppy trading conditions?

  1. Take a step back and look at the big picture themes and price trends across the business cycle and financial markets.

Screenshot 2023-08-22 131748

The above chart illustrates the relative performance of commodities, stocks and bonds index to 100 vs a 4 year moving average. The 4 year moving average is used to represent a typical 4 year business cycle.

Simple observations:

  • Bonds are bearish: major moves in higher interest rates from the US Fed that began in March 2022 can be seen on the above chart which triggered the US 10 year treasury note to fall below its 4 year moving average.
  • Commodities are weaker: although above the 4 year moving average but seem to be turning lower, and
  • Stocks have recovered from the 2020 lows and seen to be pointing higher.

Conclusion: March 2022, the time the Fed began its aggressive rate hiking cycle, could have been the trigger event that kicked off a new 4 year business cycle?

Stay tuned tomorrow we will post part two on how to navigate choppy trading conditions when seasons change….

Trading prospective:

SPX500 Index- bullish above the $4,300s?

Screenshot 2023-08-22 131811

Technical commentary: SPX500 Index

Despite that current price $4,420 remains above its 200 day moving average, last week's downside price moves leaves the door open for a potential downside move towards the $4,300s area. However, provided price can build on Monday’s upside advance then a test of the $4,460s resistance (see chart) and even an extension towards the August highs near $4,560s can not be ruled out over the short term (5-13 days).

Do you have an opinion on where financial markets are heading? Express your opinion and trade with CFDs.

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Not investment advice. Past performance does not guarantee or predict future performance.