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What We Can Expect from Day Trading in 2012

Welcome to the end of the world everyone!

There are many things that are unknown, especially when 2012 is supposed to be the super sized version of the 1999 Y2K “the world is going to end” year.  Being a day trader for roughly 10 years and a man that has been traveling around the world (check out my travel blog) there are a few things that we can expect, and no its not me getting arrested in places like South Sudan.  I actually plan on avoiding that situation again.  While the Mayan calender says that the end of the world will be towards the end of 2012, I plan on day trading until it does actually end.

More Volume & Volatility

The Euro is just the beginning of the uncertainty that is going on in the world, many don’t realize that the US Dollar is in worse shape than the Euro.  The more bad news that comes out of the financial systems of some of the largest economies in the world, the more fear will be in the minds of investors and traders.

The more fear that we have in the world the more movement we will see in the stock market.  Have you ever noticed that the market moves much faster when it is going down rather than up?  I made the most amount of money with my day trading strategy during the 2008 crisis than at any point in my career.

Opportunity To Make More Money

I hate to wish these kinds of things on the world but the fact is, the worse situation that the world gets in, the more opportunity we have to make more money.  Fear leads to the volume and volatility where day traders thrive.  There may be some good news here and there but the underlying issue is that things will get worse throughout the year.

As they get worse the market will have more movement and it will move quicker and quicker.  Have you seen the escalating situation between Iran and the United States?  This will cause a massive amount of volatility in the oil markets, especially since Iran can cut off roughly 20% off the world’s oil supply via the Straight of Hormuz.  If at any point they close the straight, oil prices will skyrocket by at least 50 bucks.

The Potential Collapse of the United States Dollar

Welcome to Thee (not the) Ben Bernank, they have something fancy called Quantitative Easing which is a complicated term to describe printing money.  While I am not going to point any fingers as to who is allowing and approving all of this, the point is that Thee Ben Bernank is printing trillions of dollars in order to pay our (the United States Federal Government’s) bills since no one wants to lend us any money.

Picture yourself lending hundreds of thousands of dollars just to try and your bills that are worth hundreds of thousands of dollars.  The world of money relies on one thing, supply vs demand, with so many dollars out on the market the value of the dollar goes down.  This only will compound the problem when people stop focusing on the Euro Crisis and focus on a much bigger problem, the United States Dollar.  View the video below:

The problem will get really serious if and when the economy picks back up again.  As soon as the economy rebounds we will start to see inflation rise and imagine what will happen when oil prices rise to $150 a barrel, that’s when the last crisis started.

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