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- 👀 Consistency rules arrive, Market sentiment has reset, Crypto inflows are back
👀 Consistency rules arrive, Market sentiment has reset, Crypto inflows are back
Lets get ourselves prepared for the week ahead!
Kieran Gohil
May 28, 2024
Hey guys, it’s Kieran! It’s a Tuesday newsletter this week due to the bank holiday, so I hope everyone is feeling fresh as the markets are open and it’s time to get back to business.
📢 Prop Firm Industry News
New consistency rules have been added at Funded Engineer and AquaFunded in the form of minimum trading days, specifying a minimum amount of profit which should be made for the day to count as a ‘trading day’. From Funded Engineer:
Effective on May 27th, , we will be implementing an additional rule to the current minimum 3 trading days requirement.
Currently, the 3 minimum trading days rule allows a user to pass in 1 day and then place 0.01 lots on the remaining days and still pass. This is not sustainable as we need more data on the trader to assess their trading performance and behavior to make informed decisions based on their data.
Effective on all accounts and all phases, ( challenges and funded accounts ) we will still require the minimum 3 trading days, but each of those days must achieve a 0.5% gain on the account.
Whilst I very much am not a fan of consistency rules, I am happy to see these firms focusing on deterring gamblers in the name of keeping their business model’s sustainable. I am funded with both Funded Engineer and AquaFunded but I much prefer Aqua’s implementation of the rule as they do not apply it to the funded stage, which is a big benefit. Those who follow me on twitter know that I target 1% on my funded accounts each payout cycle, so I will now need to tweak the strategy on my Funded Engineer account. However, if it means that the firm will survive, then so be it.
Follow my journey on X -https://twitter.com/kierangohil_
🕜 Economic calendar
Here are this week’s red folder news events. Thursday is the day to watch with US GDP, Unemployment and Pending Home Sales all hitting within 90 mins of each other.
Times are in EST
📈 The Macro View
One (slightly) down week in the S&P500 and sentiment has reset. A rare red candle last week as risk markets took a bit of a pause. Many weak hands have sold out of this rally already and market internals have reset for potentially another leg higher.
Hedge Funds continued buying. One group that that did not get flushed out were Hedge funds, who’s net exposure to US Megacap Tech stocks ended the week at fresh record highs.
S&P500 sentiment in election years, summer strength is likely. June, July & August are usually uneventful in risk markets however in election years the S&P500 is historically up 1.3% per month on average. We are already up 14% this year, but nothing can be ruled out.
Crypto inflows are back. Last week crypto inflows spiked again, putting in a 10 week high. Bitcoin is 60% up on the year already, however if we are to have a summer risk rally, then crypto is very well placed to benefit. A great asset class to trade if you have the stomach for it, but it is critical that your risk management is on point.
🏆 Poll
I want to dial in the content of the newsletter as much as I can, so let me know what you think in the poll below. Lets start with a general overview.
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OK guys, I hope you enjoyed this week’s newsletter, stay safe out there and i’ll speak to you next Monday!
Kieran
🔥 Follow me on X (Twitter)
Follow my journey on X https://twitter.com/kierangohil_
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