When There’s Blood In The Streets

You already know the answer to that: Buy Property. It’s an old truism that everyone active in the financial market seems to know but at the same time rarely anyone appears to be capable of following. Don’t blame yourself – it’s simple human nature. Something out of the ordinary happens and immediately fear sets in. And if you weren’t afraid to begin with seeing everyone running and screaming will most likely change your mind quickly. And that works pretty well in the physical world when for example you see people dashing out of a zoo or trampling each other in order to escape out of movie theater.

Unfortunately it accomplishes absolutely nothing when it comes to participating in the world of finance. If in fact everyone wants to sell then they must know something right? Well, they do – they know that everyone is selling. So they sell and are actually correct doing so for quite a while. The fear of danger always outweighs one’s fear of losing out (a.k.a. greed) because it is human nature to perceive pain of loss more intensely than the joy of gaining something.

Nevertheless, assuming you have a reason to believe that prices won’t drop too much lower (or would recover far above any temporary drop lower) this is a brilliant time to buy. Of course that doesn’t mean it’s a good idea to step underneath a falling sword. But if you are able to extricate yourself from your current emotional state as well as the damage you may have incurred, and instead assess the situation objectively, then massive gains can be made.

Since all eyes are on cable right now, let’s take a look. Clearly Wall street is intent on punishing British voters for daring to upset the status quo by throwing a monkey wrench into the globalist aspiration of a borderless and thus uncontrolled planet without any trade hurdles. It’s quite possible we’ll a drop to 1.3 and perhaps a little dip lower. But let’s not forget that a lot of high priced and GBP denominated property is owned by the elite and ideological interest is always superseded by financial interest. I have a feeling that self serving sentiments will eventually prevail but for now I would NOT force a long entry here. Best to observe another day or two until we see a short term pattern we can sink our teeth into.

The EUR/USD meanwhile seems largely unaffected despite the fact that the BREXIT vote was a huge slap in the face and mandate for change for the European Union. Once again perception trumps reason and one wonders where the real long term risks lie. In an independent Britain free to negotiate its own trade deals and already controlling its own currency? Or in a conglomerate of bickering nation states which can’t agree on what to disagree on across the entire gamut of fundamental issues that are currently threatening its long term existence.

Of course the long term really isn’t of anyone’s interest. What moves emotions is the here and now. And as of this moment the EUR is for some reason perceived to be on the right side of history here. Which is why shortening the EUR here may not be a great idea, at least while it’s holding LT support levels. Should those come under threat I would be the first in line to consider riding it lower. FWIW – I find it interesting that this pair should hold strong while other USD crosses have been taking it up the rectum since Friday. But I learned long ago that attempting to make sense of market gyrations is neither a profitable nor and enjoyable endeavor.

One general observation before we get to slaying hapless disoriented victims. Equities aren’t in great shape either but in the great context of things have not evinced much weakness during the latest drama du jour. However that said – the drop through the weekly NLSL at 2022 and the 100-week SMA is concerning and needs to be reversed post haste or we could easily see a slide toward the 1900 mark.

Soybean Oil is once again on my plate today. The recent drop has returned us to a potential bounce region but I will make sure to put my stop below the 31 mark, below 30.8 would be best as currencies are on the move and that affects commodities obviously.

But we’re just getting warmed up. There’s a lot of fun to be had in commodities today…

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