Patience pays off 22 ITM

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Patience pays off: 2/2 ITM

The Euro was on a bit of an upstreak this morning. If you look at a daily chart of the EUR/USD, you’ll see that we are down at around the lows from mid-May. Being these could act as support level, I wasn’t surprised that the Euro made some gains against the USD today. That said, I don’t necessarily know if that level is going to hold and if we’ll see a bounce back up to the 1.3000 whole number. In fact, I’m betting against it in my forex trading currently. I took a short at my 50% Fibonacci retracement level of 1.28757 (drawn from the price movement 1.20411-1.37104), with my stop-loss placed at 1.29189 (above the daily high of the July 5 candle), with a take-profit at the 61.8% Fib level of 1.26788.

I’m not totally confident in this trade. Based on my stop-loss and take-profit level relative to my entry, it currently sits at over a 5:1 reward-to-risk, which is a pretty safe and conservative approach. Although we’re around recent support, I have the prevailing downtrend and Fibonacci level working in my favor. I’ve found that Fibonacci retracement lines tend to work very, very well in forex trading when plotted on the higher timeframes. I rely on them heavily to help me make decisions and they’re always nice when they pop-up in binary trading, as they help to give me a guide as to where price may potentially gravitate.

EUR/USD recent daily chart:

Also, I really like to stick with the trend when trading forex, prefering to take trades on pullbacks to support or resistance within the context of the current market trend. Incidentally, these are also my favorite types of trades with binary options, as well. Last week, I took a short trade from 1.30727 (38.2% Fibonacci) and got out of it at 1.28757 (50% Fib). All I was doing there is taking a short trade off a pullback back to the resistance point offered by the 50% Fib, and it netted nearly 200 pips worth of profit.

I guess the moral of the story is that it should always be a daily part of your pre-trading regimen as a binary trader to check the macroscopic picture of the asset(s) you’re trading. Check the daily chart, and you can continually narrow in your focus by looking at the four-hour, one-hour, 30-minute, 15-minute, and finally the 5-minute or 1-minute chart (whichever you prefer to trade with). Note any possible support or resistance on each timeframe – mark them on your chart with horizontal lines if you need to – and note the general market direction that the asset may be trending in.

For today’s binary trades, it actually took me quite a long time to find a good set-up to trade. I started watching the markets around 3AM EST and it took me nearly five hours (!) to find a set-up I was comfortable trading. I did have a decent put option set-up on the 4:20 candle right around the 1.2837 price level (see image below), but I did not take it. I had a resistance level working in my favor, but I was wary of the trade because the prevailing trend for the morning was markedly to the north-side. The trade would have worked, but my belief that the EUR/USD would continue to go up was correct when it broke above 1.2837 at 5:00. Also, last Friday I had attempted to take a trade against the trend using just a weak support level. It was one of the two trades I lost that day, which served as a reminder to myself of the danger of trying to catch a falling knife, so to speak. Trading with the trend (if one applies) is always the best primary filter to apply toward your trading.

There was also a pivot level in play to act as a potential resistance area at 1.28513. Price did move up to that level at around 6:00. But of course it’s not a good idea to simply trade the level just to trade the level, especially against such a strong uptrend. I always prefer to have more than one factor going for me whenever I make a trade. The very best set-ups will have three or four things working in your favor (e.g., support or resistance level created from previous price history, the trend working in the intended direction of your trade, and even a pivot point or Fibonacci retracement level serving as support/resistance as well).

I did consider call options at the pivot level, but price never did touch and reject that level first – a form of price action confirmation that I prefer – so I never took the trade. It’s not one that would have worked out anyway as the market fell back below pivot. However, price had shown a bit of consolidation between 5:00-6:00 around 1.28407. Once the market got back down to that level at around 7:30, it touched, fell below, and wicked back above 1.28407. So on the following candle I took my first trade of the day, a call option on the touch of that price. This trade did spend some time in the red, but I had the trend working in my favor and the trade pushed itself above my entry point for about a one-pip winner.

My second trade occurred back up at the pivot level of 1.28513. The market had briefly consolidated there for about fifteen minutes just after 7:00, meaning price had shown some sensitivity to the level. Price touched and rejected the pivot on the 8:15 candle, so I took a put option on the subsequent touch on the 8:20 candle. I wasn’t as concerned about the direction of the trend on this trade – at least not enough for me to avoid the trade outright – as the market had essentially been neutral over the course of the past three hours and was no longer making new highs for the morning. This trade closed out over four pips in favor.

Overall, it took a long time for me to find these trades. But in trading, patience definitely pays off and it’s nice to start the week out strong.

The Tell

Mark DeCambre

‘Fed action is likely to be imminent, swift and substantial. While that will not prevent a recession, it is part of the bottoming process especially if fiscal policy follows…’ says Mike Wilson

Michael Wilson

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Michael Wilson, Morgan Stanley’s chief U.S. equity strategist, said that it may be time to jump back into stocks after the stock market plunged into a bear market with the sharpest one-day slump since the 1987 crash.

“We are now trading slightly below our downside case on the S&P 500 and believe it is time to start adding to equity risk for longer term investors,” analysts led by Wilson wrote in a Thursday note.

“ ‘We are now trading slightly below our downside case on the S&P 500 and believe it is time to start adding to equity risk for longer term investors.’ ”

— Michael Wilson and Morgan Stanley team

The strategists said that based on their analysis, the recent drop for the S&P 500 SPX, +2.28% from its Feb. 19 peak is overdone and represents an outlier that could point to an opportunity for investors (see attached table):

On Thursday, the S&P 500 and the Dow Jones Industrial Average DJIA, +2.24% registered the their biggest one-day percentage drops since the Oct. 19, 1987 crash — and the S&P 500 and the Nasdaq Composite COMP, +1.72% joined the Dow in bear-market territory, commonly defined as a drop of at least 20% from a recent peak.

The slump for the major equity indexes comes as fears of the coronavirus and other jitters, including crude-oil’s CL00, +6.95% precipitous fall this week and uncertainties around the 2020 presidential election in the U.S., brought a record-setting 11-year bull run for stocks to a screeching halt.

Wilson and company said a recession is a greater likelihood because the outbreak of COVID-19, the infectious disease that originated in Wuhan, China late last year and has spread to more than 100 countries across the globe, has all but shut down major industries including airlines and cruises and is threatening to deliver shocks to other areas of the domestic economy.

Wilson had previously said a recession could produce the type of washout that would allow for a renewed rally.

“I’m rooting for a recession in some ways because that’s what would get the flush in terms of expectations that still has to happen,” he explained back in October.

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In the Thursday note, Wilson said “price action and our conversations with investors suggest the market is clearly moving toward a base case of a U.S. recession but liquidity and positioning dynamics have played a major role in accelerating the move lower in our view.”

“The end of this cyclical bull market which we think began in 2020 was accentuated by liquidity induced froth on the back of the Fed balance sheet expansion last year,” the Morgan Stanley analysts wrote.

In July of 2020, Wilson accurately predicted that the market would see its largest correction in months, with the rally showing signs of “exhaustion.” He wrote then: “The bottom line for us is that we think the selling has just begun and this correction will be biggest since the one we experienced in February.”

Wilson says that he expects any recession to be short-lived and sees a base case scenario for the S&P 500 to hit a year-end target at 2,750.

“Fed action is likely to be imminent, swift and substantial. While that will not prevent a recession it is part of the bottoming process especially if fiscal policy follows from multiple regions of the world,” the Morgan Stanley analysts wrote on Thursday.

The investment bank said it has recommended defensive positioning for the past 18 months, but hadn’t expected that a recession would occur as rapidly as it likely will play out now due to the recent shocks catalyzed by the viral outbreak.

The investment banks says that the sectors that tend to perform the best after a recession are health care and consumer staple stocks. Check out the table below that offers greater detail:

Patience pays off in My Time at Portia

By Tim Biggs

At first glance My Time at Portia seems incredibly derivative, not just of other rural life sims like Harvest Moon, Stardew Valley and Rune Factory, but of Minecraft, Zelda and Final Fantasy too, among others. But give it some time and you’ll realise that the various influences on this slow-paced building game are actually pooled into something pretty special.

Portia takes place hundreds of years in the future, after humanity has advanced, destroyed itself, lived in dwindling numbers underground and finally emerged to rebuild. You arrive to take over your dad’s old workshed on the outskirts of town, and immediately set out to become a renowned builder.

My Time at Portia starts simple, but it quickly becomes a very convoluted game.

While you’re free to wander and take in the sights of the huge cartoony world as you like, your priority is receiving commissions from the villagers and working out how to craft them, mostly thanks to an incredibly detailed instruction book left by your old man. But while that might sound easy, building a single item usually involves spelunking in mines and scowering the countryside for materials, processing them several times in various ways to create parts and then slapping them all together.

For example one of the earliest missions requires building a bridge, the head of which needs copper pipe (mine copper, turn it into bars using a furnace, then into pipes using a grinder) and hardwood planks. The planks require chopping down large trees (which needs a bronze axe; so more copper, plus tin) and processing them on a cutting machine. Keep in mind the machines (which you also have to build) require constant fuel and take time to craft each item.

It can take several in-game days to gather all the raw materials you need for each build, and if you don’t plan properly you can easily get stuck short of fuel or with not quite enough of a rare ingredient. It’s certainly the kind of play with will only appeal to a certain kind of gamer, and I was frequently frustrated by the long time it takes to smelt, grind or cut anything.

But when you have it all together, constructing it on your assembly station is very satisfying. Especially since most of the big builds permanently upgrade or affect the town in some noticeable way. Your tools and equipment will all scale over time too, so eventually you’ll have a massive, sprawling workshop with whole rooms of much more efficient machinery. You just need to be prepared to put in the work.

Though gathering and building is the core of the game, there’s an incredible number of things to do besides. Minigames like fishing or animal taming appear once once you’ve progressed to certain points, or if you chose to take part in town events or festivals. The game keeps track of your relationship with dozens of villagers, who you might befriend, date or marry for various rewards if you can commit to putting in the time.

You can also uncover and restore ancient artefacts, donating them to researchers in exchange for advanced tools or letting the church destroy them in exchange for seeds and agricultural benefits.

If you get tired of the peaceful life, you might also accompany the local militia on missions to the wild world outside of Portia, where monster-filled dungeons can yield all sorts of special items and trinkets.

My Time at Portia is a slow game, to the point that digging around in the mines or waiting for bronze plates to smelt can be mind-numbing. But in a way its builds are kind of like knitting; repetitive and slow but visibly building towards a satisfying, tangible product. Plus, there’s enough surprise in the living world, the creepy mines and dungeons and the wide fields to keep things from getting too stale for too long.

My Time at Portia is out now for Switch (reviewed), PC, PlayStation 4 and Xbox One.

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