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BUSINESS NEWS - Now is an excellent time to get involved in the stock market as an individual investor or trader. Why?
Many companies are benefitting because of the global turmoil, inflation, military conflicts, shipping problems, and pandemic-related troubles.
Plus, as prices of certain commodities, such as oil, continue to rise, further increases may occur as the Ukraine and Russian conflict stretches into what could be a long-term situation.
Amidst these dark times, there is some good news if you’re looking at personal investing.
Supply chain problems tend to benefit companies that offer alternative methods of delivery. Likewise, when COVID variations strike, medical supply firms thrive. Even inflation and war can open doors of opportunity for some manufacturers and service providers.
What are the best investment and trading opportunities for the highly volatile and unpredictable year of 2022?
For individuals who trade and invest from home, it's essential to learn to read the main volatility index to get a feel for how much the market is moving.
Then there's the death cross, a prime market signal that has just come into play. It’s important to learn what it is and how to integrate it in your everyday dealing. Additionally, there are opportunities in commodities, whether prices rise or fall. The goal is to predict the direction of price moves to profit from volatility.
ETFs (exchange traded funds), gold, and cryptocurrency are three other segments of today's market that investors can use to their advantage. All are part of the critical stock and equities markets. For people who know what kinds of shares to purchase, precious metals, any sector's ETF, and even cryptocurrency can be part of an overall stock investing strategy. Volatility is perhaps the most crucial concept of all, so it makes sense to begin by grasping how to read it.
Learn to Read Price Volatility
You don't need to be a statistician or IT guru to read the highly informative volatility 75 index, also called the VIX. The general rule is pretty simple; when the VIX is above 30, the market is in a volatile state. For traders who prefer see-saw pricing scenarios, a high VIX value might be a reason to get into the markets. People who prefer to trade in more serene circumstances wait for the VIX to rise above 30 before placing trades. Currently, the volatility 75 index is at about 22. Interestingly, as soon as the Russia and Ukraine conflict began, the index shot up significantly, well into volatile territory. But after just three weeks, the number is back down to the low 20s, where it sits today. The VIX measures oscillation within the S&P 500 Index. When the number is above 30, traders say the markets are officially in a fear position. Thus, the higher the VIX, the more fearful investors are.
The Death Cross is Not So Deadly
In March of 2022, the S&P 500 index's 50-day moving average crossed below the 200-day moving average, into a pattern widely known as the Death Cross. This significant development often signals lower overall stock prices for the near term. However, many investors view the Death Cross as a time to pick up excellent bargains on shares that have fallen in price. What should you look for before buying after a Death Cross? For bargain hunters, the two essential signals are the Cross and a VIX value both being below 30. In other words, even though prices are generally going down, most traders are not in fear mode.
Commodities
Russia and Ukraine are responsible for many of the world's most critical commodities, such as grain, natural gas, gold, and oil. As both countries become economically ravaged by the ongoing war, expect prices for all their exports to rise. By some estimates, the Russian economy has already shrunk by about 50 percent.
Currencies
Even the most diehard stock traders look at the currency markets to evaluate a nation's relative economic strength in international markets. The value of the Russian Ruble began to sink precipitously as soon as the recent hostilities started. Because the conflict has a profound impact on most nations in Eastern Europe, all of whom are key trading partners of Russia and Ukraine, it is likely that all of those nations' markets may suffer. Short sellers and speculators often seek out ailing economies.
Gold and Crypto
Whenever significant military encounters batter the international markets, prices of gold and cryptocurrencies tend to rise. Enough people view the two as safe-haven investments that it's a good bet the Russia and Ukraine war will substantially affect all the precious metals and top-rated cryptos.
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