Some think he’s a downright scrooge while others may call him a benevolent Santa. Whether you love him or hate him, when Mario Draghi, President of the ECB (European Central Bank) speaks, the world listens.
On December 3rd Draghi delivered a major policy decision speech. It revealed that the ECB pushed its deposit rate further into negative territory by reducing it by ten basis points to -0.3%. Major refinancing operations rate and the marginal lending facility rate were not altered, remaining at 0.05% and 0.3%, respectively. In addition, the ECB extended its asset purchase program under which it purchases bonds worth 60 billion euros every month, to March 2017 from September 2016, which isn’t exactly a hard deadline. Those don’t really exist in the Central Banker’s world.
Mario’s speech last week sent currency markets askew. The US Dollar was hit hard by Draghi’s comments for sure. Forex traders still want to keep finding profitable opportunities, though. So what should you expect going forward?
On the fundamental side, this is a balancing act between two central banks (FOMC and ECB) propping the Euro up for its inevitable next decline. While last Thursday’s move was violent, the markets have leveled off since. The US Dollar has also stabilized.
With the big fundamental play behind us, traders need to find the right time to jump back into the dollar. But here’s where things get tricky.
Those that are utilizing leading indicators, like those found in VantagePoint, are at an advantage. Trend forecasting capabilities give traders the confidence to enter a currency market after it’s made a big move. Whether it’s a countertrend reversal or a further confirmation, traders utilizing technology that forecasts markets with up to 86% accuracy are prepared for these types of events.
Whether you are an active day trader who can’t get enough action during the six and a half hours the stock exchanges are open or an investor looking for new profitable opportunities, after market trading offers an attractive option. The after-market can be especially profitable for traders who have an added technological edge, like VantagePoint Intermarket Analysis Software.
After Market Trading Defined
The stock markets have gone through many changes, from the old days of hand writing trades on chalk boards to the high speed electronic networks of today. Still, in the recent history of the exchanges, most traders could only buy and sell stocks during the regular business hours of major stock exchanges. For most US Exchanges (NYSE, NASDAQ,), regular business hours is typically defined as 9:30 AM – 4:00 PM Eastern Time. Trading before and after regular exchange hours first became available for large institutional players in the early 1990s.
Today a number of electronic trading networks (ETN) allow all investors to keep trading even when the big money players have stopped participating. Nearly all the major online brokerages and full-service brokerage firms will allow you to enter buy and sell orders for stocks to be executed after the exchanges close. Some may charge extra commissions and fees for after hours, but not all, so you’ll need to check with your broker.
However, with any investment there are inherent risks. Here are a few risks involved with after market trading:
- Increased volatility. While AAPL, NFLX, GOOG and the other names should be okay to trade in the after-market, for stocks with limited trading activity, you may find greater price fluctuations than you would have seen during regular trading hours.
- Lack of liquidity. During regular trading hours, it is easy to match buyers and sellers as there is sufficient interest on both sides of the market. During after-hours, there may be less trading volume for some stocks, making it more difficult to execute some of your trades.
- Bigger bid ask spread. Less trading activity could also mean wider spreads between the bid and offer prices. As a result, you may find it more difficult to get your order executed or to get as favorable a price as you could have during regular market hours resulting in slippage.
VantagePoint Provides an After-Market Edge
Considering the inherent risks, you need a tool to help you find profitable trading opportunities in the after-hours. VantagePoint can help as it forecasts the big trending or gap moves in a stock that often happen in the after-hours market due to an earnings announcement or other important news.
How can VantagePoint do this? By using intermarket analysis and a neural network process to find hidden patterns and relationships between markets, VantagePoint’s proprietary indicators provide short-term trend forecasts that anticipate trend changes. This process provides a unique perspective on markets that uses foresight, instead of hindsight, allowing you to find profitable opportunities if you are after market trading.
How to Diversify Trades in Today’s Global Markets
If you’re looking diversify trades in your portfolio then it’s important to ensure you have a system that is accurate and consistent regardless of the market you are trading at that time. VantagePoint’s predictive technology works across all markets and conditions to help futures, forex and even stock traders become consistently profitable, no matter their different trading styles.
In today’s video we showcase recent successful VantagePoint forecasts for the following markets:
Futures chart – We’ll show you a Soybean forecast that helped VantagePoint traders profit $2650 per contract in just 11 trading days.
Forex chart – We’ll show you a U.S. Dollar/Canadian Dollar forecast that helped VantagePoint traders profit $4183 per standard lot over 7 days.
Stock Chart – We’ll show you a Earthlink $ELNK which helped VantagePoint traders cash in profits of 47% in just 36 days.
Why should I diversify trades in my portfolio?
Today’s markets are completely intertwined and have a global impact on one another. Rather than trading in isolation it’s important to have a global perspective on how other markets push and pull the price of the market you are trading. Understanding these complex relationships can help you win across the board when a trend takes place.
VantagePoint Software, developed in 1991 by Market Technologies, LLC holds 2 patents on the science behind applying Intermarket Analysis and Neural Network technology to a trading software. Our software identifies the 25 intermarkets for each stock, commodity, forex pair etc that you are trading and identifies what weight should be applied to each. The end result is a deadly accurate forecast for the next day’s trading range.