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Macroeconomic Analysis And Trading Ideas

New one family housing in US - Macro Chart & Analysis. Be very careful those who wants to buy houses, I would suggest stay liquid or park your capital somewhere you will not loose your purchasing power as we know Central Banks are printing Trillions of USD/Euros to bring back stability but at the cost of taxpayers money, they are printing more money indirectly stealing the purchasing power of people who saved their entire life. Wait for the right time i would suggest at least 6-12 months so the dust settles down.
FRED:HSN1F
by E2S100
1
UNDERSTAND THE EURODOLLAR!THE EURODOLLAR FUTURES CONTRACT REFLECTS THE L.I.B.O.R. INTEREST RATE (A BENCHMARK FOR THE INTEREST RATE AT WHICH MAJOR BANKS LEND TO EACH OTHER)! WHEN THE PRICE OF THE CONTRACT INCREASES, THE L.I.B.O.R. INTEREST RATE IS DECREASING, WHEN THE PRICE FALLS, IT IS INCREASING! THE PERIOD I HAVE HIGHLIGHTED IN THIS POST IS THE PERIOD OF DOLLAR ILLIQUIDITY THAT OCCURRED IN THE LATE 00s-EARLY 10s! AS THE FEDERAL RESERVE INTERVENED AND PROVIDED LIQUIDITY, L.I.B.O.R. WAS SUPPRESSED, AND THE SIZE OF THE INTERVENTION ALMOST PUSHED THE RATE TO 0! THE SIZE OF THE INTERVENTION IS IMPORTANT IN THAT IT REFLECTS THE SIZE OF THE PROBLEM, INDICATING THAT THE GLOBAL LACK OF DOLLARS WAS SEVERE! WHILE THE INTERVENTION SUCCEEDED IN SUPPRESSING L.I.B.O.R. OVERALL, THERE WERE SEVERAL PERIODS DURING WHICH THE LACK OF AVAILABLE U$Ds CAUSED LENDING BETWEEN FINANCIAL INSTITUTIONS TO CONTRACT, INCREASING L.I.B.O.R., CAUSING A NUMBER OF PROBLEMS AND FORCING FURTHER ACTION BY THE FEDERAL RESERVE! THE 2008 GLOBAL FINANCIAL CRISIS WAS NOT NECESSARILY CAUSED BY A REDUCTION IN U.S. HOME PRICES, BUT BY A SYSTEMIC BANKING DOLLAR SHORTAGE! THE LACK OF U$Ds REMAINS, AND HAS EVEN INCREASED, HOWEVER ENTIRE NATIONS ARE AT RISK OF SUFFERING THE CONSEQUENCES, NOT ONLY THEIR BANKS! NOW THE IMPORTANT QUESTIONS ARE: 1. IS THE GLOBAL ECONOMY NOW DEPENDENT ON THE FEDERAL RESERVE PROVIDING NEW U$Ds TO AVOID A COMPLETE DEFLATIONARY COLLAPSE? (MOST LIKELY YES) 2. IS THE FEDERAL RESERVE ABLE TO SATISFY THE INTERNATIONAL DEMAND FOR U$Ds, NOT IN TERMS OF AMOUNT, BUT IN TERMS OF DEPTH, REACHING FINANCIAL INSTITUTIONS AND CORPORATIONS NOT DIRECTLY TIED TO THE MAJOR U.S. BANKS? (QUITE POSSIBLY NO, BUT THEY WILL TRY THEIR HARDEST) 3. IF WE ASSUME THIS IS THE DEATH RATTLE OF THE DOLLAR'S WORLD RESERVE CURRENCY STATUS, WHICH IS THE MOST LIKELY OUTCOME, THAT IT IS INFLATED AWAY OR THAT IT IMPLODES ON ITSELF? (I WOULD ARGUE GIVEN THE FED'S ACTIONS, THAT IT WILL BE INFLATED AWAY) 4. REGARDLESS OF HOW THE LOSS OF RESERVE CURRENCY STATUS OCCURS, A CONSEQUENCE OF THIS PROCESS WILL BRING ABOUT A COMPLETE SELL-OFF IN THE U.S. TREASURY MARKET, FORCING THE FEDERAL RESERVE TO COMPLETELY MONETIZE THESE BONDS TO PREVENT INTEREST RATES FROM RISING: IF THIS UNFOLDS, CAN ANY OTHER POSSIBILITY BUT HYPERINFLATION BE CONSIDERED? (NO)
GEducation
by UnknownUnicorn4195243
5
Weekly Preview: Good News Keep Coming!The market is coming back to its previous bullish trend, two proves of that: - Nasdaq is already in neutral territory YTD - Volatility is around 48%, well below its peaks - Some companies, specially American technology are regaining ground effectively sooner than expected which is also good news. The two pillars within this environment that are working are two: 1./ Central bank aid (this was expected to work immediately) Stimulus from central banks and governments has brought confidence to the market 2./ Covid-19 numbers Trend of better daily numbers of new cases are consolidating and some businesses are starting to reopen - Bearing in mind this, the market doesn’t react to an economy, it foresees what the economy will do and act base on that. Current Context: March was harmful, April is better with consolidation taking place. Even times are going better than expected with numbers improving faster than expected. Again, Nasdaq has already recovered those YTD loses and this is important because normally it brings the rest of indexes with it. First the DOJ, which represents more classic companies with high dividends, and after Europe. Then, short term facts are being positive too. 1. Gilead Sciences has reported successful treatment of Covid patients and can be a ray of hope. 2. American attitude, they are focused in reopening the economy and that creates big expectations. To finish, we´ll have some economic indicators with more government meetings that will still bring more confident to the market and strengthen this faster than expected recovery.
FX:NAS100Long
by PepeMafia
GET READY: A big fortnight ahead!This is an educational post - compliant with the house rules on text-based contributions - showing some of the tension between monetary policy taken by the FED and real world fiscal issues at deeper levels. Click and drag chart if all text does not show. Thanks. The tension has caused whipsaws in the US Dollar, and price of Gold. The IMF has declared a global recession and several countries have gone into recession. Reputable opinion out there is that the world is heading for an economic depression based on a 50 to 75 year cycle, which is coinciding with a 10 year recessionary cycle. I have no doubt that central banks around the world will have limited success in propping up economies. I'm more concerned for the longer term view. Last week extreme volatility took a break compared to the previous week. The next 2 weeks could see a return of volatility to indices and forex markets. Stay safe, fellow traders.
FOREXCOM:US30Education
by Captain_Walker
3
IMPORTANT MESSAGEAfter much deliberation, I adjusted my current market opinion somewhat. Basically, I am still bearish about the current events and get my idea of ​​the last 5th movement in the bearish direction realistic. However, the following scenario should also be kept in mind and not be surprised by certain bullish tendencies: The governments and central banks of the countries or economies will provide any liquidity that is needed. There is no tactic and debt avoidance, like in the financial crisis in 2009 or the Greek crisis in 2012. Therefore, the market itself reacts to negative data with positive price jumps, since it is assumed that further relief measures will be provided. IMPORTANT ! THIS CAN WORK, BUT THE FALL IS ALWAYS ENORMOUS, because when one link gets out of joint, it pulls everyone down. No country is currently allowed to face acute payment difficulties. In addition, it is still possible to argue whether all negative economic effects have already been sufficiently priced into the courses.
AMEX:SPY
by macrolukas
2
Technical Breakdown in DXY. STRONG & GROWING Fundamental DriversCheck out my DXY chart from November. DXY fell from 99, just under 100, all the way down to 95/94 in ~2 weeks. High correlation with the Fed cutting rates and yields falling. With the twin deficits set to GROW not shrink and the Fed's balance sheet set to GROW not shrink, and with interest rates set to FALL not rise, the path for the US dollar is looking more and more clear. Weakening dollar will mean foreign markets outperform US markets and rising commodity prices. Markets can still crash but they will crash in terms of gold. Look at the DJI to Gold ratio for reference. Quantitative easing from 2011-2015 did not work. For that reason I think we can easily take out 80 and 70 in the DXY. For the DXY to go on another bull market cycle there would have to be decent growth expectations in the US behind that. That's not happening. We are loaded up on massive amounts of debt. Growth rates are going lower not higher. Central bank balance sheet expansion (Counterfeiting/money printing) is going higher.
INDEX:DXYLong
by Ludwig_Von_Mises
Prepare to Buy the Dips in Gold & Gold StocksKirkland Lake is down 40% from gold's September high of 1550 yet Gold is pushing $1700. Its down 18% from the market meltdown. I suspect this means that if gold gets sold in the coming crash that the dip in gold and gold mining stocks will be limited not extended. It won't be like 2008. A 60% correction from September's high puts Kirkland at $20/share. I will be buying that if we even get that low. If we get lower than that consider it a blessing. Kirkland has some really amazing All-In-Sustaining-Costs to getting gold out of the ground. $2000 - $3000 gold will be incredible for Kirkland lake.
KLong
by Ludwig_Von_Mises
1
Why central bank policy is terrible but you have to deal with itIt’s just like in a comedy movie. And to me it looks like that the people have absolutely no idea about the monetary policy and how they handle it. So yes we have a crisis right now and that is something that also our big central banks from the US and Europe already have recognized. But the effectiveness of their tools to support the economy is pretty bad. Why is that so ? Well if we look a little bit deeper into our current crisis which has appeared by the consequences of the corona virus we can see that we have to deal with a double shock from the supply and demand site. This is something we haven’t seen in the last 100 years in the market and so it is a new phenomenon for all people who participate in the markets. But the central bank policy is pretty easy to understand: We print more money and increase the money supply to keep our market liquid. Moreover we put interest rates near zero and start quantitative easing to support the bond market which also leads to more money supply in the stock market. But does that really work ? As I menaced before we have a supply and demand shock that means people are fearful to make any new investments one the one site and on the other site these people can’t also go to work to earn some money and pay the bills. So a pretty dramatic situation like we have it never seen before. What really helps are not the actions by the FED or the ECB. In my view it’s about the activities made by the federal government. Many companies are already under water and don’t know how to pay the bills and if they’re able to recover from this hick any time soon. What these companies really need are direct payments and tax suspensions by the government. The government has to give these companies some kind of stability right now and this could also lead to more stability in the financial markets. The central banks already gave the market the signal that they will do everything that is possible to keep the markets liquid. And thats pretty much everything that they can do right now. The real challenge will face the governments of this world if they have to accomplish the way from crisis to recovery in aspect of the worldwide economy. We see pretty bad numbers at the moment especially the job numbers in the US. Time for the markets to react on it in a proper way.
OANDA:SPX500USD
by macrolukas
Gold Continuation, Silver Catch-Up in Loose-Money Election YearIn a year that will likely be mired with rate cuts, QE, and rising budget deficits - expect gold to continue its 2019 breakout. Fibonacci, trendline, and XAUJPY calculations give us a target range of 1711-1823 in the price of gold. In achieving this target we expect silver to catch up at least to the low 20's. This move looks highly likely in 2020 and will result in significant repricing in silver junior miners. Keep accumulating ounces and company shares. Heading into the top of this move we will be taking defensive action as we expect a significant correction to occur. It won't be a straight move through $2,000 gold. Given that: 1. The miners and silver have been severely lagging gold which has NEVER been a positive sign for a sustainable multi-year bull market 2. large resistance exists at the 1800-1900 level 3. Monetary policy lags the market, meaning the Fed rarely moves quickly in a straight line. there's a solid chance the Fed bluffs a hawkish stance, causing a temporary gold sell-off It is likely we will correct and consolidate prior to breaking through 1900. Other Thoughts: Monetary policy operates with a lag, which means the rate hikes and QT from 2017-2018 is still creating headwinds for this market. Although the market odds have not yet priced it in, it is almost certain the Fed will not hike in 2020, and it is increasingly likely they will cut rates at least 1-2 times. QE is likely here to stay and expand. The Fed wants a weaker dollar, Trump wants a weaker dollar, and the global markets want a weaker dollar. Expect a weaker dollar unless the Fed wants a liquidity problem. Monetary policy, more than ever, is the driver of this market. I could be wrong and gold could fall - but that would require a very tight monetary policy which would almost certainly cause problems in stocks and debt markets. So be watching the Fed, listening very closely, and watching how the markets respond. Earnings have never mattered so little. All that matters now is central bank liquidity.
FX_IDC:XAUUSDLong
by Ludwig_Von_Mises
6
BAILOUTS FOR GOVERNMENTS ARE THE REAL PROBLEM!I SEE MANY PEOPLE COMPLAINING ABOUT BAILOUTS FOR THE PRIVATE SECTOR! HOW ABOUT THE REAL PROBLEM: BAILOUTS FOR GOVERNMENTS! I WOULD BET MY LIFE SAVINGS THAT THE ECB WILL GUARANTEE THAT ITALIAN (AND EVERY OTHER EUROPEAN NATION'S) BOND YIELDS REMAIN SUPPRESSED BY SACRIFICING THE VALUE OF THE SAVINGS OF EVERY PERSON IN EUROPE! UNTIL GOVERNMENTS ARE ALLOWED TO DEFAULT, WE WILL CONTINUE A STEADY MARCH TOWARDS GLOBAL COMMUNISM! WESTERN CIVILIZATION, THE FREEST AND MOST PROSPEROUS COLLECTION OF INDIVIDUALS IN THE HISTORY OF THE PLANET, WAS BUILT ON PRIVATE SAVINGS ACCRUED THROUGH EXCESS PRODUCTIVITY (ACCUMULATED CAPITAL)! THE RIGHTS OF THOSE INDIVIDUALS AND THE VALUE OF THAT CAPITAL IS ON THE VERGE OF DESTRUCTION!
TVC:IT10YShort
by UnknownUnicorn4195243
1
Yellow Metal Losing the Shine?It was fishy already the moment when I realized how people being greedy over equities TVC:SPX | TVC:DJI . Knowing much of major steps already taken in action from global governments and central banks all those honchos working together to save their own country equally from this pandemic created financial crisis let me think at least once that something is coming better for the future even if it's not soon but later for sure! I have already realized some good changes around which I don't like to mention here but take it optimistic for now and know that the shine of this yellow metal may no longer be brighter then past if the whole world are about to contain this virus inside a box!
FOREXCOM:XAUUSDShort
by Anatta0
5
AUDJPY Probabilities Price DirectionThis is an easy game to know how the global pandemic isn't settled yet and knowing how all big central banks honchos cooperated together to fight against this pandemic by deciding to lower OCR rates equally to combat against the corona virus. State & Europe are new continents who are for now struggling and combating strongly against this pandemic. I hope they win this battle soon but for now, commodities are hampered badly it seems a pity moment to even know how badly supply chain distortion has ruin commodities overall. Comdolls have very fewer probabilities at this hard period of time to even think that they may rise back. They need some pure remedy like " vaccine development " good reports to bring back optimistic. The move upward may only be some correction or retracement on price but it will be hard to think if it is an overall reversal in trend. We all know oil has been the most interesting commodity lately and knowing how it heavily plunged due to the pandemic case so I have not much good faith over comdolls bullish sentiment at least for now. One interesting thing which I would like to talk about is how New Zeland trying to combat strongly lately knowing how it cuts the rate below RBA (which was emergency cut in the weekend, Sunday) seeing that RBA has still room, for now, to get equal to its neighboring country which probably is a case market participant may price in lower for further remaining rooms for cuts (still 0.25 bp room left comparing to other). And lastly, how could I close my idea without mentioning our China which plays the main role over this global pandemic case. If you knew the more china in hurt or the escalation of spreading the virus rate and death counts then remember it will equally hurt Australia and Newzealand businesses as well so keep in that mind. Be sensitive over global risk news updates. This is all some beyond technical analysis thoughts from my side to this pair and if you find this idea valuable don't forget to support me with providing a thumps up! Peace :)
Short
by Anatta0
3
Gold Miners Set to Outperform US Stock MarketTechnical breakout and retest. My expectation for 2020 is a volatile market for both the US indices and for the gold miners. I think gold miners will actually outperform US stocks to the downside here and then will explode higher once we reach full ZIRP and QE5++. The SPX and other US indices could take a major blow in terms of gold which will drag down gold miners a bit but they won't get killed like in 2008. I think miners are waiting for gold to clear $2000/oz, then they will soar like you cannot believe. I think we can get $2000/oz A LOT faster than seems possible. Gold miners are at historical lows relative to the rest of the US economy. Be snagging shares during this period of correction. I ultimately think XAU could surpass all-time highs or at least surpass 0.2 on this ratio but even if we don't get that and all we get is 0.1, we will still make a killing in gold miners. if we go to .2 or higher we will make a fortune.
NASDAQ:XAULong
by Ludwig_Von_Mises
1
Dow Jones to Gold Ratio - Major Trend Shift UnderwayLook for gold to perform similarly to how it behaved from 2009-2011. I believe a significant part of gold's bear market from 2011-2015 was due to the world placing trust in the Central Banks and believing the lie that the Central banks had saved the day. That trust is fading quickly, evidenced from gold's move from 1180 to 1700 in the last 15 months. When ZIRP and QE forever becomes a reality gold will already be past $2000/oz and will make up for the years of underperformance. This is not a pie in the sky prediction, this is real life. Every day the markets are getting closer and closer to fully pricing this reality in. Lets do a quick comparison. 2008 Crash: - dollar soared - stocks fell - gold fell, and less than stocks - gold stocks fell worse than US stocks - Emerging market stocks fell worse than US stocks 2020 Crash so far: - dollar falling - stocks falling - gold holding steady - gold stocks falling but more relative strength than US stocks - Emerging markets falling but more relative strength than US stocks What's different now? The dollar is getting ready for a big fall and the central bank balance sheets are getting ready to explode. 85 DXY wouldn't surprise me in 2020.
FX_IDC:XAUUSDLong
by Ludwig_Von_Mises
3
US Dollar Crisis - Alert!It looks like we're seeing the beginning of a new financial crisis. Don't be fooled, this historical collapse of the market isn't because oil prices, but because of simultaneous bubbles popping, starting with the stock market bubble, Federal Reserve Bubble, and debt bubble. If we take a look at the response from the government, its horrifying. They are taking steps that will inflate this bubble beyond comprehension. Based on what the government and the private Federal Bank have said we should soon see: Imminent Rate Cuts - Negative Rates High Possibility. $150 Billion QE Liquidity - As a start, which can easily double. Stimulus to private sector, small businesses, and even corporations. Pay-roll Tax Cuts - Even less income, higher debt and more printing. This is very bad. All of these steps will expand the Feds sheet massively, eclipsing what took place in 2008. This entire economy is based on this cheap money that has been pumped all over the world under during the last administration and Fed chair. This time, 0% interest rate and QE won't stop the bubble from popping. The Federal Reserve will resort the helicopter money, and in the end, the results are going to be a loss of confidence in fiat. You will soon see failures of fiat starting with the Euro, then by Yen, next will come the US Dollar. This bubble of debt including derivatives is somewhere passed $250 TRILLION. This stack of cards is coming down hard, and the more the central banks do, the bigger the problem is. In fact, the more involvement they have, the greater the collapse is. From here, the domino effect gets greater as consumer spending collapses, taking down housing, autos, and stock prices. This leads to closures, which leads to layoffs, which leads to high unemployment, which leads to welfare, which leads to more printing of money. So, where do we go from here? Safe havens. First and foremost gold and silver, as these will break out of central bank's manipulation hold. Next, for a quick profit taking, gold mining stocks see a massive rally (200-800%) during any economic, geopolitical, political issues, or elections. Check chart history on ASM, NGD, BTG and others to prove it. These stocks are massively undervalued in comparison to gold. Do I suggest Bitcoin? Absolutely not. From what we've seen today, along with numerous other selloffs, crypto has been falling WITH the stock market. From here, metals, and honestly, some prepping for inflation. Buy things now before hyper inflation kicks in. All of this money printing WILL show itself in inflation. Lastly, in a word of opinion.. this next crash will be the death of fiat. Central banks have been foaming at the mouth over digital money for a long time but infrastructure hasn't been there. The evidence is everywhere, as cash is disappearing. China is seeking to digitize their currency. Sweden is the most cashless nation on earth. P2P payment systems and companies are sprouting everywhere. The signs are there, if you care to look.
TVC:DXYShort
by WorldEconomics
What does a market reaction to the Fed's decision say?Since yesterday, by and large, was the first full day of working out the Fed’s emergency decision to lower the rate by 0.5%, today some results can be summed up. And they are generally disappointing for optimists. In theory, stock markets should have perked up and provoked a sharp increase in stock indices. But this did not happen, that is, there was growth, but not at the scale that could be expected. In theory, the pressure on the dollar should have intensified. But yesterday, the Dollar Index rose. In theory, the Fear Index was to drop significantly. But according to the results of yesterday, the decrease was insignificant. What are all these signals talking about? The magic of Central banks no longer works the way it used to. Lower rates no longer automatically resolve existing problems. And this is a very alarming signal for stock market buyers, gold sellers, and other optimists. It seems that the bubble is nevertheless broken and the air, despite all the efforts of its creators, is gradually coming out. In general, monetary policy has exhausted itself and this is an extremely alarming signal: if the situation worsens, it will not be possible to resolve the situation with the usual methods. The consequences of the coronavirus have not even begun to appear, and Nasdaq is quoted 10% below the maximum and, it seems, can no longer grow with the certainty with which it was literally a couple of weeks ago. So in everything that happens, we see the strongest confirmation of our basic investment ideas: sales on world stock markets, and especially on the US stock market; gold purchases and sales of risky assets (such as the Russian ruble). But back to the events of yesterday, which was very full of news. The Bank of Canada lowered the rate immediately by 0.5%. The Canadian dollar obediently worked this out, losing about 100 points paired with the dollar. But in general, the reaction was relatively calm at such a massive reduction in rates. US employment data from ADP turned out to be quite good: +183K with a forecast of +170K. What sets in a positive mood against the dollar ahead of Friday's official statistics. The ISM Index in the non-productive sphere also pleasantly surprised: 57.3 points with a forecast of 54.8 points. But the Eurozone indices traditionally fell short of expectations and for the most part, came out worse than forecasts. Well, the results of super-Tuesday played into the hands of the dollar, on which Biden won quite unexpectedly, who is considered a more adequate option from the Democrats as opposed to the “left” Sanders. In general, our desire to sell a pair of EURUSD intensified up to the recommendation to sell the pair from the current ones with the addition of any attempt to grow. Oil stocks in the United States have grown quite slightly, but all the attention of oil market participants has been riveted to the OPEC meeting and OPEC+ decisions. It is very likely that today some specific information will appear that could provoke strong movements in the oil market. If OPEC+ decides on additional reductions (ideally about 1 million b/d), oil has a chance of growth. The main stumbling block is Russia and its unwillingness to scale up the reduction.
by Trade24Fx