The Biggest Opportunity in the Markets Today
If you are looking to get large gains in the markets fast, I would ask you to look outside of plain vanilla stock investing.
Stocks get most of the attention from the financial media, because most investors think of them as the most important asset class.
They’re not. In fact, stocks are one of the smallest markets on the planet.
Globally, the stock market is around $80 trillion in size.
That sounds like a huge amount… until you realize that the bond market is more than THREE times this at $244 trillion.
And the currency markets dwarf even the bond markets!
While it’s impossible to know their full size (every currency trade involves two currencies so the net size is impossible to measure), we do know that the currency markets trade an astonishing $6.6 trillion per day.
To put this into perspective, the New York Stock Exchange – the single largest stock market in the world – typically trades just $200 billion in volume per day.
Put simply, the currency market, based on volume alone, is 33 times larger than the stock market. This is the largest, most liquid market in the world. So when a major change occurs, it hits these markets first.
That’s why if you’re looking to gain insight into what’s going on in the global financial system, you NEED to look at the currency markets.
The Dollar is the King of Currencies
When you look at the currency markets, the first thing you need to look at is the U.S. dollar.
The U.S. dollar is the reserve currency of the world. Everyone and I do mean EVERYONE uses the dollar to trade.
Remember how I told you that the currency markets trade $6.6 trillion in volume per day?
The U.S. dollar makes up 88% of that.
Put another way, add up the currency transactions of every other currency on the planet and the U.S. dollar is more than EIGHT times bigger than that composite. The U.S. dollar is the king of currencies. Whatever happens to the dollar will have massive implications for every other asset class on the planet.
With that in mind, consider that the U.S. dollar has been moving upwards in a clear channel for the last year or so. You can see this in the chart below.
This channel is preparing to breakout, either up or down, based on what the Fed does in the next day or so.
When that breakout occurs, the entire financial system will adjust, offering traders the opportunity to profit from the $6.6 trillion in currency volume moves this way and that as other currencies change based on what the U.S. dollar is doing.
And best of all, because of its size, you only need to be in the currency markets a day or two to see massive returns.
Editor, Money & Crisis