China Overcomes USA and Europe in M2, while the Hidden Truth of American Economy turns the Global Game.

[Igor Pereira]

Good morning, Traders and ExpertFX members!

Evaluating the financial landscape, we are at a point of historical inflection. It is no longer just about volatility; it is a fundamental power shock where trust in the West is being destroyed inside, while the monetary power of the East reaches unprecedented levels.

By Igor Pereira, Financial Market Analyst, Junior Member WallStreet NYSE

The data we compiled in this analysis is the unquestionable proof of this change. They reveal that the weakness of the dollar and the rise of gold are not accidents – they are the logical consequence of the systematic erosion of American economic power and the rise of a new centre of monetary gravity.

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1. The Hidden Lie: The American Labour Market Crisis

The foundation of American power (the labor market) is undermined by flawed data and fabricated optimism.

• Catastrophic Revisions: BLS employment reports showed that over 1 million jobs have been reviewed down since February 2022. The Deutsche Bank chart shows this relentless fall trajectory, proving that the economy has been systematically weaker than the government reported.

• Consumer Panic: The consequence of this deception is loss of confidence. Consumer expectations for rising unemployment in the US have reached levels historically associated with the 2008 Global Financial Crisis.

My Analysis: The US economy is forcing Fed's hand. The pressure for an interest cut (as seen in the probability of 88.2% of the FedWatch tool) is not a proactive stimulus; it is a inevitable reaction the weakness that the government bureaucracy itself tried to hide.

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2. The New Power Center: China and the M2 Explosion

While the US is fighting its own fragility, China is displaying an overwhelming monetary force.

• Monetary dominance: The Chart of China's Broad Monetary Offer (M2/M3) Overcame $47 trillion, exceeding the combined monetary offers of the United States and the European Union.

• Physical Gold Drainage: This monetary force is manifested in the precious metal market. SGE/SFE reports show a record physical demand, with weekly losses in silver vaults over 35,000 kg, and closes with strong prizes, proving that Chinese trust money is actively being exchanged for physical metal.

My Analysis: The power to create credit and liquidity lies now in the East. China is using this monetary superiority to execute a fiscal sovereignty strategy, accumulating tangible assets while the West deals with the consequences of its debt.

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3. The Definitive Strategy: The Focus on Feeling, Not the Line

In this environment of confusing data and conflicting narratives, our philosophy of trading becomes even more vital.

• Retail Error: As we detailed in our material about the efficient use of lines, the error of the retail trader is to draw lines and expect the market to respect them. The market doesn't care about your lines.

• The ExpertFX School Principle: The logic behind tracing lines is to capture a impression of market sentiment and offer an interesting location to give a directional bias.

  • Step 1: Identify the price dynamics (the trend).

  • Step 2: Wait for the price to reach an extreme.

  • Step 3: Seek an accumulation/distribution structure that confirms Smart Money's intention.

Final conclusion: The fall of the dollar is inevitable; it is a consequence of American economic weakness and China's immense monetary strength. Gold is the asset that reflects that truth. Our strategy is simple: ignore short-term noise and isolated lines, and position us in the path of liquidity and sovereignty, which points firmly to real assets.

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To navigate the system dysfunction and apply the Smart Money methodology:

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