Featured How to & Advice

Balancing the Global and Philippine Markets

Trading both the Global Markets and the PSE is not an easy task. It will be difficult at first, but you will get a hang of it. As traders, it is our mission to look for strength and uptrends outside our local market, once the opportunities, based on your grade A setup, run out in the PSE.

Referring to the figures above, while the SPX was trending from 2019 to early 2020, PSEi was in a sideways movement. Certainly, I advocate the Bottom-Up Approach which I first learned from Mark Minervini in his book “Trade Like a Stock Market Wizard”, which simply means that a trader would focus on individual stocks first. Although, the opportunities in the US Market were far superior to that of the opportunities that sprung out of the $PSEi in the same period.

Did you have a hard time trading the PSE during 2019? I will be honest with you all, I started trading the PSEi in early 2019, and I found it difficult to trade. Fakeouts and shakeouts happened quite often. Although, there were a few names that were still making new highs while the PSEI was moving sideways such as $WLCON, $CPM, $SLI, and $HOUSE. Although, given that the US Markets contain approximately 7000 stocks (in the case of NYSE and NASDAQ), hundreds of stocks were making new highs, in comparison with the PSE.

That is why it is important to follow the opportunity present across markets. If you were to succumb to the PSE, chances are that you found it difficult to trade. Back in 2019, I was not prepared to venture out of the local market because I thought of it as my comfort zone. I found it daunting to explore other markets. I thought that being in the PSE is enough to suffice my goals as a trader.

In my personal experience, trading the global markets while trading the PSE was not easy at first. There will be several factors that you need to assess before you commit to trade across markets.

Are you eager to put in more work to achieve your trading goals?

Can you trade from 9:30am to 1:00pm (adjusted market hours until further notice) in the PSE, and trade from 9:30pm to 4:00am (due to time zone difference) in the US Stock Market? Other than that, can you also trade in between those times (given that Forex and Commodities are 24/5, and Cryptocurrency is 24/7)?

  • This doesn’t mean that your eyes will be glued to your monitor 24/7. Before the market opens, one must PLAN THEIR TRADES so that you could set all your MARKET ORDERS.
  • I put orders in advance so that I do not get left behind when the potential trade goes in my favor. I do this especially on 24-hour markets such as the Forex, Commodities, and Cryptocurrencies.

Are you willing to come out of your comfort zone (the Local Market)?

Willingness to learn:

  • A New Platform.
  • How trading with leverage works.
  • How shorting works.

Accepting the risk involved in trading the Global Markets

  • The US Market is prone to gap ups or gap downs during earnings season.
  • Each asset class has a different DNA, wherein one may be more volatile than the other and driven by different fundamental factors.

The Global Markets will be a new environment that will require more effort in comparison to trading just the PSE. As Michael Jordan said, “You miss all the shots you don’t take.” It is such an overwhelming and eye-opening experience to trade across several markets. Indeed, continuous learning and building new experience is the key to navigate through our trading journey.


Contributor:

Full Name: Miguel Lorenzo L. Cagampan
Investagrams Username: @Gagambatrader

Channels:
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About the Contributor:

Gagambatrader is a personal brand that aims to provide value and content with regards to trading in the financial markets using Technical Analysis. Gagambatrader aims to influence and provide to the growing community of traders in the country.


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