I like currency markets. There is a good reason for it. Predictability. Like watching a football match, you tend to get an idea of what the result will be before the final whistle. Of course there are injury time goals and silly sendings off or other spokes in the wheels but in the medium term things are quite predictable when you look at the game. With currency the game is one of politics and manipulation.
You don’t need to go too far back in history to think yeah a pound gets you almost a dollar and a half. Then a dollar and a third before Christmas and now a dollar and a quarter is quite ridiculous.
Political “incorrectness” as displayed by Trump or the Brexit debacle gives big speculators the willies and their algorithms go into overdrive. Add to this the likes of George Soros type manipulation and you end up with “enertia” which can be (and is) taken advantage of. An overshoot of good dollar/bad pound in recent weeks is right now (Jan 2019) slowly backtracking. Slowly, because profits from the unnatural moves are being collected as the pound slips back to where it belongs. The net result will be that eventually, when we find that the US and China are not getting into fisty cuffs or Brexit has not resulted in mass starvation, the currencies prices will reflect something nearer their true values.
So, sadly, currencies are treated like futures now but if you can get past the doom and gloom worst scenario and realise that actually trade (the real measure) has not changed at all you can see where the graph is headed.
If anyone likes this twopenneth worth I may follow up with “Venezuela”.
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FX is not considered as part of the ‘alternatives’.
Not sure why you would reply to my post with such a sweeping statement Mr Gold.
Here is the mandate for posts under the heading Alternative Investments:
“A place to discuss alternative investments - startups, commodities, property, you name it!”
For the reasons outlined in my post, you would not have to be super savvy to have realised 400 - 500% mark ups on currency speculation between September 2018 and mid January 2019.
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