Good day, everyone!
Hello Traders, and welcome back to our new recording of webinar! As you know, I was away last week skiing in Austria—it was amazing, although half of my family was sick. Interestingly, the market seems a bit “sick” as well, given the current volatility.
Trump has delivered on his promises, imposing tariffs on imports from Canada, Mexico, and China. Despite these announcements being anticipated, the markets still reacted with surprise, leading to a strong gap down across global major indexes. At the same time, as expected in a risk-off environment, the US dollar moved higher as a safe haven.
This trade war is just beginning, and things could get worse. There’s speculation that the new tariffs on Mexico and Canada might push those countries into recessions. If that happens, it could trigger a domino effect impacting other regions as well. Canada, for its part, has already announced a response, as stated by the Canadian Prime Minister.
Given this environment, FX flows are likely to remain volatile. The key right now is to focus on selective trades. If you’re trading forex, avoid currencies that could be directly impacted by the tariff situation. For example, the Euro could face pressure if Trump delivers new tariffs on European imports, as hinted in his recent statements. In this case, you may want to avoid EURUSD and instead focus on EUR crosses or rather on currencies like GBP, CHF, or even JPY, which may present better opportunities in this environment.
But whats most important during this time of uncertainty, is that you zoom out and focus on big picture, which to me still looks like stocks and cryptos are in a corrective retracement, while USD is at the resistance.
For more analysis check our Elliott Wave webinar below.
Grega
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