 What's going to happen to you know, the price of gold or the price of the stock market or you know or oil, etc Right, that's what we're here to do. So price increases and decreases and this is typical, right? It's it's it's In trading what we what we're looking at is it's a probabilities game. There are no Certainties there are no certainties. You have to get this certainty thing If you if you have it in your head totally out of your head It's just the likelihood of one thing happening over another and think of I like to always use the analogy of thinking of myself as You know a multi billionaire, for example, right and I create jobs and I'm investing in countries and I'm looking at the Globe as a whole and I'm looking at countries of which to invest and part my money and you know grow my capital now There are Certain things I'm going to do right as you know hedge funds do it portfolio managers, etc They understand the relationship Between a where money flows depending on the environment. So I Have you guys heard of Ray Dalio who I think he manages I think a hedge fund called Bridgewater Associates or a bridge with visual head funds, but basically I think it's the the biggest one of the biggest hedge funds in the world and All hedge funds have portfolios, right? They have portfolios and they allocate Sorry, they allocate their portfolio Right, and they they have for example, they might say that might be allocated to commodities You know a small portion might be allocated to, you know Gold a large percentage of it might be allocated to, you know stocks and another one might be to for example bonds and They, you know, this might be I don't know 10 percent, you know, five percent This might be about enough 50 percent and the rest might be to bonds. So but what they do is they they adjust their percentage of What they're going to allocate, you know, their their their hedge funds to Hello, hello with the mic on if you can While you're listening is it possible to switch the mic off actually matter for I'll mute everybody just in case People yeah, right So but they understand the reason why they come up with these you know percentages, etc Because they understand what typically does well. Yeah in a risk-on environment and where money flows in the risk-offing Risk-on and risk-off environment. Yeah, so and these percentages will change depending on You know the risk sentiment So Price yeah Doesn't always reflect value and value doesn't always reflect price Yeah, at any one point in time, but we typically know where what prices should do Yeah in the medium to long term Depending on the environment that we're in so risk-on environment commodities. Why do commodities like oil and copper? Yeah Typically go higher in a risk-on environment So think about you know before we were talking about global the global and local growth. Yeah risk-on So if the if the economy is growing Yeah, it means that maybe there are more, you know, there's there's more house building going on There's more businesses investing. There's more transportation people flying everywhere, you know So commodities are going to be in demand because you know of construction projects and things like that that are going on Globally and locally so the price if there's more demand Then supply. Yeah, and in oil for example OPEC dictate the the level of of supply Then commodities will go higher there's more demand than supply. Yeah, what typically happens so If you are a country, you know that the lies export wise on On on these commodities commodities like oil and copper iron ore, etc. Then those countries should typically do well because Countries are growing they're exporting more they're selling more Right, which means if they're selling more than they're importing, you know, you're pretty much growing your Budget surplus, you know, rather than a deficit Also in the risk-on environment equities and you know stock market tends to rise Right, because again, if you think about the knock-on effect potentially in a growing economy Companies are growing. They're taking on more staff, you know more profits more earnings, etc. They're expanding the workforce Dada, right? So risk-on environment. This is what typically happens and In a risk-off environment Yeah, we have commodities like gold and silver that typically do well, right? And that will strengthen in a risk-off environment as it's seen as a safe haven You know store store of value safe haven currencies like the yen and the Swiss franc and you've got government treasury bonds again Government treasury bonds are seen as safe haven Assets because governments in the Western world anyway rarely the chances of them defaulting on their payments You know on their debt Which is basically what bonds really are I guess Very pretty much slim to none if you know, I mean so in that sense They're pretty safe in the Western world Yeah, government bonds So But what happens is vice versa? Yeah, so vice versa in a risk-off environment. Yeah Commodity currencies or commodities don't do so well, right? So they end to go they end up going lower Why is that because for example, just look at for example, COVID, right COVID-19? Global slowdown as we were talking about here. So global slowdown recession right risk-off What's happened to the price of oil? Yeah, what's happened to the price of commodities because it's more supply than demand and In effect what happened and what should have happened and you'll see it not necessarily over the past maybe two three weeks But overall if we look at a price chart what you'll see is commodity currencies Have, you know Falling yeah equities and stocks have fallen Yeah So if we know typically typically again, what happens in certain environments and going back to sorry a risk-off environment where if we're in a risk-on Environment yeah, and going to these guys then gold should typically go down safe haven Currencies like the yen and the Swiss franc should go down and government treasury bonds should go down Yeah, and in fact what I'll do is I'll go to a chart just to show you guys because I know everyone liked the charts Everybody loved the charts. Yeah, and again what typically happens in these environments So we've been in a we've pretty much been in the risk off Oh, well, I've have forgotten to put here as well is trade war as well. That's that's another one as well That goes in the risk-off Box is trade war so if we look at if we're looking at just certain asset classes I guess you guys definitely know this but just to show you just to illustrate the point If we're looking at daily timeframe charts or we please and we zoom out we've been in really a risk-off environment for ages For a good year and a bit if you think about when the trade war really started All we've seen is prices go to the upside. Let's look at for example bonds bonds same thing in a risk-off environment You should get something like that happen now. There is an anomaly to this because stock market Yeah, stock market was also going high and this is why we say typically what typically happens, right? so up until February and This has been a bit of a mystery for a lot of traders If you if you you know been keeping your eye on the news it has been a bit of a mystery why the S&P has been really going higher and higher I mean to be fair from a risk-on Scenario last year and and and the year before I guess the US was growing Yeah, so if you go back through the fundamental analysis spreadsheet You'll see that the US was heading shoulders above pretty much every other economy So it would make sense from that perspective, but once Coronavirus hit. Yeah, you definitely got you know, it's like to come really into the consciousness of people You're just starting to see you start to see this if you know, I mean before yeah, so from a risk-off perspective Let's go to commodities like oil. Yeah, so again coronavirus pretty much from February You've seen prices, you know move to the downside now within these Again these these price movements increases and decreases you do get pullbacks None of us know how long these pullbacks are gonna last for You know and none of us know how long the risk-off or risk-on Environment is going to is going to specifically last like I couldn't tell you that it's going to last for this week Or this month or this year, but We have tell-tale signs that we can Look for if you know, I mean or we can look back on through history So for example through history, we've been through, you know the recessions So if we've been through recessions, you know Clever clubs and statisticians out there will say okay, well take the average recession How long does it ever session usually last for and I think the average recession last for around Something like a a year to two years. Sorry fits The way I've come to understand be aware of the macro and then look at the prevailing resensitement at the Sorry, it's the same the way he's come to look at come to understand it is to be aware of the main macro Fundamentals then look at the prevailing resensitement at the moment then considered local sentiments pertaining to currency You want to trade to determine the strongest and the weakest. That's it You're kind of looking at the really the bigger picture and then you're kind of zooming down Right, you're zooming down Into countries locally Yeah, and then maybe on I mean, I still kind of stay away from you know daily sentiment in that way I'm more still looking at the the medium term or really what is what is prevalent? What is really in the papers? Yeah, so Yeah, basically exactly exactly right just like top-down analysis. What's the bigger picture? Because you got to think you got to think to self again and going back to thinking as a massive investor Yeah, think think of yourself as you've got, you know millions and millions and billions of pounds, right? And you're investing Remember you're investing for the future. You're looking at the You're not looking at short-term horizon. You're not even concerned with pricing the short-term You're trying to look at value Right from a long-term perspective because you've got plans for the next two three four five years Yeah, you're not trying to just jump in the market and jump out. You're not even really a trader. You're trying to look at Countries, you know, are they growing? Should I be investing in the emerging markets? For example, should I be going to India? Should I be going to China? Should I be going to South Africa? Should I be going to these countries? Is there an opportunity there? Yeah Yeah, by the rumors all the facts Leon, sorry I am a big Hold on before you go before you go before you go, right? Is it specifically is it specifically to what I'm talking about right now? If it isn't if it isn't yeah, then please definitely hold the question Hold the question It's just that I want to say did you record it because I'm coming in I just want to listen, but I hope you recorded the whole session so I can look at it I am recording this. Yeah, I am recording. All right, go on Praying is recording anyway because this is yeah, it is recording is recording. It's recording on the thing. Yeah All right, so so unless I mean you can ask questions But I would actually say I would probably prefer if anything Derek to pretty type it in the chat box Because this is going to be recording I really want to kind of maybe stay on track with with with the things that I'm with the things that I'm trying to Get out. All right, so But thanks for that Derek. It is being recorded. So So the point is is think about yourself from from from that perspective, you're an investor You're not a trader per se. You're an investor Where is where is the growth coming from where? You know, what what is what what should I put my money into and out of and if we go back to again hedge funds They understand this from the long term. Yeah, and they reallocate their percentages based off of The environment. Yeah, and again it being a scale Yeah, so in a risk on environment Being zero maybe that being ten or whatever it is most extreme ends Yeah, of the risk environment this percentage gold May increase to like 20% Yeah, if the more we start to look for a risk off Environment and it will decrease their portfolio and something like stocks Yeah, when I might go to maybe yet like said 20% and stocks, for example may go down to, you know, 30% Yeah of their portfolio Depending on where they are or where they think they are on the scale. Yeah, so they're hedging Yeah, their positions because they typically know where money where the big money is Putting their money. Yeah, and it putting their investments So this is the way that we have to think about our trade ideas so simply put all we're doing is this is as Traders in either, you know, Forex, I know some of you obviously myself look for, you know, gold and silver trades Some of you may be trading, you know, the stock market bonds, etc What we're doing is And to put it simply is we are trying to Tick as many boxes as to why we should be Long or short a currency pair. So an example of this current example right now of this is And also as well, I just want to mention is that there are times where the environment It's clear as day. It's clear that you should be going long or going short a Currency, yeah, or a commodity or the stock market, etc. And there are periods in time where it is less clear Yeah, so going back to for example oil or the stock market. It was really clear that once the COVID-19 started to spread Yeah, it was very very clear which way you should have been trading Yeah, from the beginning of maybe February March April, right Gold Yeah, it was pretty clear right February yet we got this massive kind of stop hunt and I'm still in this on a silver trade by the way from from way down here. I Think maybe Liam might be still in this But there are traders that you know, I was saying to basically get long around here because ultimately we knew Overall where the long-term, you know price would potentially go Stop markets Yeah, when You know, we were in the midst of it from again from February It was really clear To pretty much see that you should have been short in the stock market Why is that because every you know paper every publication news publication was saying the sky is falling the sky is falling There was no there was no risk on environment. There was no growth. There was no well You know vaccine except right potential for a vaccine. There was none of that going on in the news. It was literally death toll death toll spread death toll countries being locked down schools being locked down That was what it was. That was like the extreme end of The risk off, you know, where we work in a risk-off environment Yeah, so Again going back to what I was going to say is this is is there are times where It's very clear what direction you should be trading and there are times and their environments where it's not so clear Yeah, but there are still edges because what we're ultimately doing in in currency currency land anyway is trading potential divergences to EU Right GU for example right these are the main currencies so Let's look like Right now where we are and let's on the balance of probabilities because again, maybe another analogy to look at it is Let's look at this like it's like a seesaw So we're gonna try to put as much Of these tick as much boxes yeah on Eva European site Yeah, and the dollar site Yeah, and the more boxes that ticked is the heavier it's gonna become and this is the way you should be trading So from a from a you know, it should be short the euro and potentially as a result long the dollar Yeah, so let's see who carries the most weight and we'll do this for these for these major pairs So if what I'm saying resonates with you why not check out trading 180 comm there is a Selection process to trade my supply and demand zone for X strategy. I'm only looking to work with Individuals with the right mindset, you know, who are hard-working as well. So Check that out and access really for less than one pound a day This some of the strategies in here are not for beginners So if you don't know what supply and demand is please check out all of my Supply and demand videos. I have hundreds of videos on YouTube so you can check that out first Guys take care and until the next video. Have a good one