Like most stock market sayings, they aren’t intuitive until you see them simply applicable.
For new traders especially day traders who want to make their daily bread, ‘trade what you see’ doesn’t make much sense. The thing is, if you don’t see anything, don’t trade, but that’s not the initial idea, the idea is to separate what your hoe for, expect or need from what you see.
However there come a time you will see something and go ‘h look at that I’ve know what happens next.
So lets look at the dollar.
What do you see?
Doesn’t take Nostradamus to see this.
Its hard to imaging with interest rate set to come down that the dollar would rally in the current set up. It wil take something extreme to push the dollar up. Trump doesn’t want a strong dollar, nor does anyone else in particular, so its going to go sideways.
Then what?
Fundamentally the dollar is to strong for what the US has planned, so the answer should be ultimately, it will slip.
However the dollar is not going to die or lose its reserve status. Who wants that status, if it hollows your economy out. China obviously thinks it is an exorbitant curse or it would already take the fact it has twice the currency (in dollar terms) in circulation that the USD has. To be the reserve currency you need to have no currency controls and that isn’t appealing at all to China. Could you even pay Japan or Europe to take it on???
So the dollar will continue to be the monetary hub and all the doomsters will carry on parroting the same old nonsense.
The key idea to play with is, while all the doom and gloom that has poured out since the GFC, if you had followed that, and I hope you didn’t, where would your finances be now, after the greatest bull run in US stock market history.
Trade what you see.