The Year of the Dragon: A Celebration of Wealth, Prosperity, and Superstition
Welcome back to another week of trading! This week, we’re looking into the Chinese New Year, what it’s all about, the sentiment, the superstition, and the financial significance. After that, we’ll dip into the top tradeable events this week and get you all set up for trading. Sound good? Let’s do it!
The Lunar New Year
The Chinese New Year, also known as Lunar New Year, is a celebration that marks the beginning of a new year on the traditional Chinese lunisolar calendar. A bit like Christmas and New Year in the West, it’s a time for family reunions, feasting, and cultural festivities.
As you may also know, the Chinese New Year is jam-packed full of tradition and superstition all designed to bring good fortune and prosperity in the coming year. And we need all the fortune we can get, right?
So, what’s with the Dragon?
2024 marks the Year of the Dragon, a symbol of power, strength, and good luck. Which all sound very useful to traders!
In pretty much all cultures, dragons are considered to be powerful creatures that symbolise strength, wisdom, and good fortune.
The dragon is said to rule the heavens and bring rain, ensuring bountiful harvests. According to the Chinese zodiac, those born in the Year of the Dragon are ambitious, charismatic, and natural leaders, with a strong sense of justice and compassion.
A Year of Good Fortune?
To attract good fortune in the Year of the Dragon, a common practice is to deep clean and decorate your home, sweeping away bad luck and making way for abundance. Red, a symbol of prosperity and happiness, is widely used in decorations, clothing, and food.
Another popular custom is to give red envelopes, or hongbao, filled with money to children and unmarried adults. This is believed to bring good luck and financial well-being.
Wealth Transfer and the Economic Landscape
Wealth transfer is really important during Chinese New Year. It’s seen as a way to honor ancestors and ensure continued prosperity in the family.
Elderly family members are often presented with hongbao as a gesture of respect and a way to pass on blessings and good fortune.
This wealth transfer is also reflected in the Chinese economy, where inheritance plays a crucial role in wealth distribution.
Speaking of the Chinese Economy…
The Chinese economy is right in the middle of a period of transformation, transitioning from an export-driven model to one driven by domestic consumption and innovation.
However, the recent global economic downturn and the ongoing trade tensions with the US have posed challenges.
The celebrations at this time of the year also impact the economy. Factories will be shut, and the markets will be closed.
Yet, it’s also a boom-time for the Chinese economy, with a spike in tourism — Chinese New Year represents the world’s largest annual migration of people — and there should also be an increase in consumerism and gift shopping, for that all important good fortune and wealth-transfer we explained.
What are you trading this year?
Are you taking the dragon as a sign to diversify your portfolio? Or sticking with what you know this year? Let us know on X at @_contentworks.
Top fundamental events week commencing 15/01/24
It’s going to be a busy week, particularly on Tuesday — let’s check it out.
No major events are planned.
● JPY — GDP Growth Annualised Preliminary; GDP Growth Rate QoQ Preliminary
● AUD — Wage Price Index QoQ; RBA Meeting Minutes
● GBP — Unemployment Rate
● CAD — Inflation Rate YoY
● USD — Retail Sales MoM
● GBP — Inflation Rate YoY
● USD — Building Permits Preliminary; FOMC Minutes
● JPY — Balance of Trade
● JPY — Inflation Rate YoY
● GBP — Retail Sales MoM
Here at Contentworks we closely follow market movements and prep content that we think your traders would love to read. Let’s get you started right here.
The Contentworks team