Before you ever place a trade, you better know what’s happening in the world — because if you’re only staring at a chart, you’re already behind.
Every market move happens in context. And context always starts with the biggest possible picture: geopolitics and macroeconomics. If you ignore that and jump straight into technical setups or sector rotation, you’re building on a fragile foundation.
That’s not just a philosophy — it’s a framework. And once you internalize it, your trade ideas will start getting a lot more robust.
Start at the top of the pyramid
Markets exist inside capital markets. Capital markets exist inside currencies and commodities. And all of that sits inside a political and economic environment.
When that top layer breaks — when governments, elections or wars create instability — the entire structure underneath gets more volatile. That’s why institutions pull their money off the table when global risk spikes. If the foundation is compromised, it doesn’t matter how attractive the chart looks — the risk isn’t worth it.
You don’t need a CIA team of analysts to understand that. Just look at how oil (USO) trades around Middle East conflict headlines. If the market senses escalation, crude prices spike. If peace talks take hold, oil sells off. It’s not about the chart — it’s about the geopolitical backdrop.
Reverse engineer the trade idea
Once you’ve got a handle on the macro context, then you can start working your way down. Is the environment stable enough for capital to flow into the stock market? Which sectors benefit from the current commodity or currency trends? Are there individual stocks that have unique exposure to these forces?
In the example I gave during the session, I looked at oil stabilizing between $60 and $70 on signs of a Middle East ceasefire. If that thesis holds, then certain trades — like an iron condor on crude or select Energy (XLE) stocks — make sense. But that entire structure rests on the first assumption: that geopolitical conditions have actually stabilized.
If that assumption breaks — if volatility spikes or war resumes — the entire trade idea has to be scrapped. It doesn’t matter what the chart says or what your Greeks look like.
That’s the difference between trading reactively and trading from a place of structural awareness. One chases noise. The other builds from signal.
So next time you’re tempted to lead with a chart pattern, stop. Ask what’s happening at the top of the pyramid first — because that’s where every real trade idea begins.
Kane Shieh
Kane Shieh Trading
Follow along and join the conversation for real-time analysis, trade ideas, market insights and more!
Important Note: No one from The TradingPub team or Kane Shieh Trading will ever contact you directly on Telegram.
*This is for informational and educational purposes only. There is inherent risk in trading, so trade at your own risk.
P.S. NOW: Hedge Funds Keep Fueling This Anomaly…
Hedge funds paused their buying for four straight months… but now, they’re on a spree, stockpiling at record levels.
See, when major moves like this hit the markets, it tends to open up opportunities for those who know exactly what to look out for…
And right now, I’ve spotted one anomaly this spree is fueling in the options market.
If everything goes just as planned, it could give us a shot at targeting extra income from the markets this summer…
That’s exactly why I just opened the doors to the LIVE room, where I’ll share details on my No. 1 setup for playing this new development…
Even better, you’ll see how you can leverage it too!
Of course, no one can guarantee wins or shield losses, but…
As you’ll soon see, it’s the same “Thursday income trade” that’s delivered FIVE winners on LIVE trades in the last six weeks.
Look, the room is getting filled up as we speak, and I wouldn’t want you to miss out on any of the details I’ll spill on how you can go after extra income every week
From 10/24/2024 – 6/24/2025 on LIVE trades, the win rate is 76.9%, 1.95% average return, with an average hold time of 4 days. We cannot guarantee any specific future results, as there is always a high degree of risk involved in trading.
