Get started

Federalreserve

NZD/USD steady ahead of employment releaseThe New Zealand dollar has edged lower on Tuesday. In the North American session, NZD/USD is trading at 0.6462, down 0.10%. New Zealand releases the Q4 employment report later today. Unemployment is expected to tick lower to 3.2%, following a 3.3% reading in the third quarter. This would mark the lowest unemployment rate in over four decades. Employment change is projected to have climbed 0.7% in Q4, after a 1.3% gain in Q3. What will be particularly interesting is wage growth, which has been robust and may have jumped as much as 9% y/y in the private sector. Wage growth has been contributing to high inflation, which the Reserve Bank of New Zealand is determined to bring down. Inflation was unchanged at 7.2% in the fourth quarter, more than three times the central bank's target of 2%. The Federal Reserve concludes its 2-day meeting on Wednesday, and a 25-bp increase is priced at close to 100%. This doesn't preclude volatility in the currency markets, as a hawkish stance from the Fed, either in the rate statement or in comments from Jerome Powell, could provide a boost to the US dollar. The markets continue to talk about a rate cut late in the year due to the weakening US economy, but the markets could be in for a nasty surprise if the Fed reiterates its hawkish stance that rates will remain high until inflation is subdued. What the Fed has in mind after tomorrow's rate hike is not clear and investors will be hoping that the meeting will provide some clarity on that front. 0.6446 is a weak support line. The next support level is 0.6365 There is resistance at 0.6485 and 0.6532
by OANDA
Pre-fed DXYThe noise pollution for the market is extreme this week, from interest rate announcements to non-farm payrolls and manufacturing PMI's. Based off technicals, the dollar is looking rather perky at the moment. The DXY seemed to find support off its 61.8% Fibo retracement level, from the 2022 gains, of 101,841. I suspect a move higher towards the 50-day MA level of 103,950 is on the cards. This level coincides with the neckline as well as the 50% Fibo retracement level of 104,184. A break above this resistance range between 103,950 and 104,184 will allow the greenback to test the blue zone between 105,092 and 105,690. The RSI has bounced out of the overbought zone and the daily MACD indicator is currently holding a buy signal which is dollar positive.
TVC:DXYLong
by Goose96
2
The Rand in the rocky credit markets The economic calendar is wild this week so I thought it would be best to do a deep fundamental dive into the USDZAR . All the attention will be on the Federal reserve tomorrow and whether or when they will pause their rate hikes. We need to look past the hype around the interest rate and the “pivot" narrative. Focus should however be on how the markets will cope with the Fed’s liquidity drain and how it will impact the future price of money ( ie . Interest rates). Before we kick-off, correlation does not imply causation... I’ll start by explaining the chart you’re looking at. What you’re seeing is the positive correlation between the USDZAR and the difference between the South African government bond 10-year yield (ZA10Y) and the US 10-year treasury yield (US10Y). The interest rate differential is referred to as the carry trade potential. Investors can borrow money on the cheap from developed low-risk markets and invest the borrowed money in riskier destinations to earn more interest. The interest rate difference is then pocketed by the investor. The preferred vehicle to capitalise on the interest rate differentials between two locations are government bonds (they are low risk and liquid). The reason for the positive correlation between the USDZAR and the bond yield differential is because when there is risk-on sentiment in the market, investors tend to move funds out of the safety of US treasuries and into riskier assets. The sell-off in US treasuries causes US10Y yields to rise (decreasing the bond yield differential), and the rand tends to appreciate in risk-on phases of the market, citrus paribus. (Decreasing bond yield differential; USDZAR decrease due to rand appreciation). Conversely, when investors are risk-off they run to the safety of US treasuries. The buying of US-treasuries lowers the US10-year yield which increases our bond yield differential. We all know how rapidly the rand can depreciate in risk-off phases when the liquidity wave pulls back to the US, leaving the rand on the rocky shore. (Increasing bond yield differential; USDZAR increases). Our strong correlation however weakened in August 2022 when the US 10-year yield rocketed higher after the Fed started their hiking cycle. Let’s zoom in on the Fed since its Fed week. The most important chart in the market , the Fed’s balance sheet: www.federalreserve.gov . The Fed has so far tapered roughly 5.52% off its balance sheet since April 2022. The Fed is selling treasuries to taper its balance sheet and to soak up liquidity from the market (if there will be enough buyers, only time will tell). This is rand negative. Now let’s get to where all this week’s focus will be, the Fed’s interest rate decision. The Fed is expected to slow its rate hikes to 25bps this week and push rates from 4.50% to 4.75%. The Fed tends to follow the US02-year yield (US02Y) as guidance on its interest rates and it seems as if the US02-year yield has topped out between 4.75% and 5.00%. The Fed pause seems near, and the latest inflation figures from the US supports the narrative that the Fed has managed to cool inflation. The most concerning thing in the market currently is the inverted yield curve: History doesn’t repeat itself, but it rhymes. For the Fed to normalise the credit markets it will have to pause rates. That is usually when something the market breaks and the Fed is forced to cut rates and inject liquidity into the markets. When the Fed pushes easy money ( QE or whatever buzz phrase they'll use) into the market investors rotate from longer dated bonds to shorter dated bonds. To conclude, if and when the Fed pauses its rate hikes, the US10-year yield will melt higher which could be rand positive based off our correlation analysis. Just have popcorn (and gold , silver and other real assets) ready for when the Fed is forced to cut rates/ pivot because that will be caused by arguably the biggest credit market implosion in the history of fiat money. To end off I leave you with the words of Zoltan Pozsar: "commodities are collateral, and collateral is money."
by Goose96
The yield curve has to un-invert eventually… right?Those who have been reading our past 2 ideas will know we’ve been harping on and on about expected rate path and policy timelines. Why the recent obsession you ask? Because we think we’re on the cusp of major turning points. So, for the third time, let’s look at the market’s expected policy rate path. With FOMC coming up this week, we are expecting a 25bps hike followed by some commentary/guidance on the next cause of action. Based on CME’s Fedwatch tool, markets are expecting a last hike of 25bps in the March FOMC before a pause in the hiking cycle. Now keep that in mind. One interesting relationship we can try to observe is how the 2Yr-10Yr yield spread behaves in relation to where the Fed’s rate is. We note a few things here. Firstly, the ‘peak’ point of the 2Yr-10Yr spread seems to happen right around the point when rate hikes are paused. With the Fed likely to pause as soon as March, we seem to be on the same path, setting up for a potential decline in the spread. Secondly, the average of the past 3 inversions lasted for around 455 days, and if you count just the start of the inversion to the peak, we’re looking at an average of 215 Days. Based on historical averages, we are past the middle mark and have also likely peaked, with current inversion roughly 260 days deep. Looking at the shorter end of the yield curve, we can apply the same analysis on the 3M-10Yr yield spread. The ‘peak’ point of the 3M-10Yr yield spread is marked closer to the point when the Fed cuts, except in 2006, while the average number of days in inversion was 219 days and the average number of days to ‘peak’ inversion was 138 days. With the current inversion at 105 days for the 3M-10Yr Yield spread, we are likely halfway, but the peak is likely not yet in. (Although eerily close to when the Fed is likely to announce its last hike, March FOMC, 51 days away). Comparing the 2 yield curve spreads, we think a stronger case can be made for the 2Yr-10Yr spread having peaked and likely to un-invert soon. Handily, CME has the Micro Treasury Yield Futures, quoted in yield terms, which allows us to express this view in a straightforward manner allaying the complications with DV01 calculation. We create the short yield spread position by taking a short position in the Micro 2-Yr Yield Futures and a long position in the Micro 10-Yr Yield Futures, at an entry-level of 0.623, with 1 basis point move equal to 10 USD. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Reference: www.cmegroup.com www.cmegroup.com
CBOT_MINI:2YY1!Short
by inspirante
9
The Fed rate or Why everyone is watching the US economy?The Fed or the Federal Reserve System is a kind of analogue of the central bank in the United States. It is an independent body and receives powers from the US Congress. Its independence lies in the fact that all decisions on monetary policy do not have to be approved by the authorities and even the president. We can say that the Fed does not belong to anyone, because. after agreement with the Senate, the main positions are appointed by the President of the United States, but the owners are private individuals. The functions of the Fed are the same as those of the central bank: issuing money, controlling private banks, changing the key rate, and other important decisions for the US economy, which affects the economy of the whole world. Let's analyze them in more detail: maintaining a balance between the financial and social spheres; protecting the interests of participants in banking operations; dollar issue; control of the internal financial market; acting as a depository for large organizations; supporting the functioning of payments within the country and between countries; maintaining liquidity. And now let's take a look at the questions about the impact of the Fed's actions on the crypto economy in order, so that you have a general picture of what is happening. 1. Why do many investors and traders in stocks and cryptocurrencies constantly follow the news from the US, especially the speeches of the head of the Fed? One of the Fed's main tools, through which they influence the US economy, is to raise or lower the key rate. The Fed sets the percentage rate at which loans are issued to banks. This, in turn, affects other market segments, and the effect is different for each. This has a direct impact on the bond market: the higher the rate, the higher the yield. However, the effect on the stock market is completely opposite, because the reduction in the rate is followed by an adjustment in other lending rates. At a low rate, companies' businesses can grow faster. Due to this, stock quotes of many companies also increase due to the increase in their capitalization. Consumer and business confidence is on the rise, the real estate market is rebounding, and corporate earnings are rising, which in turn has a positive effect on share prices. As the interest on loans decreases, the interest on deposits also decreases. There is more money in the financial system, which encourages people to look for more profitable areas of investment. Yes, just a second. We feel that you may get confused or never understand what it is and why everything works the way it does. Let's explain with a very simple example. The Fed rate is the percentage at which the main bank lends to other banks. If it falls, then other banks can take out a loan at a low interest rate and also issue loans with a small interest rate for organizations and individuals, including mortgages and credit cards. The decline in market interest rates encourages people to take out loans and buy various goods, invest in real estate and invest. The interest on deposits is falling, it is becoming less profitable to keep money on deposits, and people are looking for more attractive ways to invest - these are, first of all, stocks. Due to increased demand, the price of stocks and indices rises. And if the main indices grow, such as the NASDAQ, S&P500 or the Dow Jones industrial index, then Bitcoin grows, and other cryptocurrencies follow it. At the same time, if the Fed rate rises, then people pull their savings out of riskier types of investment into more stable ones (deposits / deposits). Thus, the capitalization of the stock and cryptocurrency markets is falling, followed by a price drop. As you have noticed, everything in the world of economics is interconnected, and it is extremely difficult to explain all its principles in one article. We just want to bring you to the relationship between the Fed rate and the cryptocurrency market. And here comes the next question! 2. Why is Bitcoin most of the time correlated with major stock market indices? Everything is a little easier here. Previously, Bitcoin was something incomprehensible to most - an uninteresting technology and hype. But as blockchain technologies are introduced into everyday life (mass adoption), Bitcoin has turned into a risky, but quite common asset of the market. Because of this, relatively recently, “old” money has entered this market. People who used to earn only in the stock market and large companies entered the market. Large investors have developed strategies for trading and investing. Thus, for them, Bitcoin has become a financial instrument, just more risky. From that moment on, there was a high correlation with the stock market. In conclusion, one of the important questions. 3. How do the US and the US dollar affect the entire world economy? In the past, there was a situation when world trade and its institutions, as well as the world banking system, became pegged to the US dollar, central bank reserves began to accumulate mainly in dollars, and a financial market was formed with tools that allow you to effectively place these reserves in dollar form. Simply put, most of the world uses the dollar, which is why it is the main reserve currency of the world. US hegemony, which influences the whole world, has been developing since 1944. Let's summarize step by step to consolidate the information: The American dollar and the US economy affect the entire world market, the first - because it has historically happened, and the second - because it is the largest in the world. If the rate rises, then after it interest on loans and deposits rises. It becomes more profitable to invest in bonds and keep deposits in banks. Companies and people are shifting funds from risky stocks and cryptocurrencies to more stable types of investment: precious metals, government. bonds or simply withdraw to fiat. If the rate falls, then after it interest on loans and deposits goes down. Companies and people are becoming more willing to take out credit, thereby increasing the financial system. Companies are developing business and increasing capitalization, people are starting to invest in more profitable instruments such as stocks and cryptocurrencies.
BITSTAMP:BTCUSDEducation
by Crypto4light
2
Was The BTC Bear made worse by the FEDBitcoin Bear PA key moments are listed here - the RED vertical lines are interest rate riaises by US FED. Nov '21 TAPROOT installed on Bitcoin Network, after which PA reverses. Slow "Bear" market takes hold and PA slides down FED has 1st Rate Hike in a very long time in March '22, Bitcon PA actually Rises. 2nd Ratehike by FED on early May News comes out that LUNA maybe having trouble and people begin getting nervous LUNA Collapses, Slow Bleed, effect being negated by 4th week after and next green candle. Confidence begins returning Till News comes out that FED maybe looking at a larger rate hike. The timing is perfect, like Hitting a wounded animal ** 1st 75 point Rate Hike causes Large Drop in PA as more companies struggle From here, the effect on PA of 2 more 75 point rate hikes are Minimal by comparison. PA actually recovers some. ** Another 75 point raise is too much and FTX is brought down. The Timing is perfect but after weeks of uncertainty and bad sentiment, BTC PA makes a rapid recovery Without these 2 things, PA could very possibly be around $37K right now and would have been the least damaging Bear market in BTC, Less than the normal 80%. And what we REALLY need to take into account here now, is what is going to happen on 1st Feb. TradFI ( the FED is KING odf TradFI) is threatned by Crypto....What will happen if they bring in another 75 points ? NOT A LOT...as previously shown, Bitcoin was NOT dumped by the 2 middle raises as the Coins are held, Future profits secured. So long as no more companies are brought down, Weak hands destroyed or played.....then We should be OK from here However, This is a War between the old Monopoly and the New Kid on the block....and all is fair in Love and War. Be cautious, enjoy the ride and trade safely - the likely hood is that 2nd half 2023 is not going to be kind..... Time Will tell
BITSTAMP:BTCUSD
by Orriginal
3
Echoes of the great recession of 2008An echo of the great recession of 2008 would look easy on this chart and fits nicely with the percentage distance from the 3-year moving average. I think this downturn will be even greater in magnitude and worse in different ways. QQQ at $187 by mid-summer is what I see likely. The Fed and US Treasury need folks begging to justify their next blunder. The weight of reality will be more than can be absolved by fairy tales. Also, chart colors.
NASDAQ:QQQShort
by Scorpions99
EURUSD STRUGGLES TO GO ABOVE 1.0900EURUSD is having difficulty establishing a bullish move above 1.0900 as price has been rejected on several attempts. The latest PMI readings from the eurozone didn’t help matters with a mixed report on the state of economic activities around the bloc. With sentiments of a slow pace Federal Reserve rate hike already weighing the US dollar, the price could still make it over the current psychological price level. Current Scenario Price is reacting to the current Resistance level at 1.0900 which could see selling activity towards the intraday support level around 1.0800. Should the near-term support fail to incite a bullish recovery then attention will be on the major level around 1.0750. Bullish Scenario: A convincing breakout from 1.0900 could open the door to 1.1000 Bearish Scenario: A decline below 1.0740 could incite bearish activity but price will still need to contend with an ascending trendline running from September 2022.
by ScopeMarkets
When downside volatility becomes an advantage.It’s been a while since we looked at the Russell 2000. For the uninitiated, the Russell 2000 index is a small-cap stock market index that is made up of the smallest 2000 stocks in the Russell 3000 Index. The small-cap nature means a few things, volatility tends to be higher for one. And capturing this downside volatility using the Russell 2000 as compared with the S&P 500 has almost always proven more fruitful. When to take this trade you may ask? The recession bellwether indicator of the 2Y – 10Y yield spread is a simple place to start. With the benefit of hindsight, shorting each of the indexes at the peak ‘inversion’ points proves to be a decently successful strategy. Especially so using the Russell 2000. So the next question to ask is if we are near the peak point of inversion? To answer this, we have to circle back to research from last week, where we discussed the expected rate path for the Federal Reserve (Fed). In short, markets seem to be pricing in a Fed pause, followed by a pivot in the coming year. Looking back at the charts, this shift in stance (or pause) highlighted in the top chart generally marks the turning points for the 2y-10y yield curve inversion, highlighted in the bottom chart. Therefore, with markets expecting a pause as early as the first quarter, we suspect that the turning point for the yield curve inversion is just around the corner. On price action, the 1900 level proves to be of significant resistance, with multiple attempts to break through being rejected. As prices creep towards this resistance level once again, we think this might just provide another attractive opportunity for trading. Zooming out to a daily timeframe, the 0.382 Fibonacci levels marked by the previous high and low, also coincide close to the resistance levels on the shorter timeframe. The proven downside volatility, along with the coming turning point in the yield curve inversion, keeps us bearish on the Russell 2000. Additionally, the price action points to significant resistance overhead, around the 1900 level. Setting our stop at 2035 level (one Average True Range away & close to the next resistance level) and take the profit level at 1690, with each 1-point increment in the Russell 2000 futures contract equal to 50$. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description.
CME_MINI:RTY1!Short
by inspirante
10
IEF ShortTo begin, I am not a Seasoned Trader; I use this blog for: 1. Record keeping; & 2. Formalizing my thoughts a. If I can't explain simply here, I shldn't engage To begin, my Rules of Engagement ( RoE ) to identify an upside of +3 to 1 Risk to Reward ( “R/R” ); in this case it may yield a 3.1- 3.94 R/R. • Asset | IEF ( iShares 7-20 Year US Gov’t Bond ) • Type | Equity o Alt. Type 1 | Option • Position | Short • Entry | $ 100.46 • Stop Loss ( SL ) | $ 102.05 • Bring SL to Zero | n/a • Target | $ 94.19(-) • Exp. Time Horizon | ~ x2 FED meetings so Mar-end • Allocation | 5.00% • R/R | 3.1- 3.94(+) To begin, I will highlight the reasons why I am apprehensive about the trade ( the Con’s ) & finish up with the reasons why I’m interested in the position ( the Pro’s ). The issues / thoughts that make me uneasy ( the Con’s ) are: • I structured it to allow for further moderate appreciation o I “may” miss hitting the top but I have 1.5 wk’s for that too play out Now, the reasons I am interested in this position ( the Pro’s ): • In my blog, you can see the appendix whereby the 10Y can hover lower than the Fed Funds Rate (Upper) by 100 bps before it turns; we are there now • The FED is either going to raise (25 – 50 bps) or stay fixed in 1.5 wk’s o I believe they will raise; thus pushing the market down • Although the date range for the 10Yr Yield goes further, I am playing with the IEF (ETF) so only goes back to July 2002. Nevertheless, that posts a 1.95 standard deviated move which I’ll see as ~2 if it hits my entry & thus happy with that To summarize, the Tea Leaves & history is telling me to short albeit I may miss it. Financial Disclaimer | To reiterate, I’m not a Financial Advisor. If you engage based on the contents herein, you will lose money. If you interpret that mean by doing the opposite you will make money, that’s incorrect; you will also lose money. Thanks for your time; I hope you have a lovely day.
NASDAQ:IEFShort
by izogawa_trading
1
DXY potential LONG SIDEAfter the last three CPI reports that reported better than forecasts, DXY start a corrective move so bad…but we thinks it’s over in view of the macroeconomic aspect as well as technical. Financial markets thinks we will have pivot on monetary policies of Central banks…it’s make not sense by any mean…here on technical we have an nice spike base at 105.500, and 101.400 was touched by a hunting formation and we can expect to THIS MOVE IN WEEK AHEAD.
TVC:DXYLong
by Dalltrade
3
USA $31.4T Debt: How will this affect BTC and Stocks?❗ WARNING ❗ You're about to read an unpopular opinion... Over the past few days, we've seen bullish price action across nearly all markets. Infact, this is the first time since 2013 that Bitcoin has closed so many green dailies consecutively. This entire market reversal seemed a bit sudden, and many claimed "bull trap". (I'm a believer in the Macro, so when it comes to pure charting without fundamentals, longing was the way to go over the past few days, no argument on this). However, another interesting this happened today - the U.S. government hit its $31.4 trillion borrowing limit TODAY, amid a standoff between the Republican-controlled House of Representatives and President Joe Biden's Democrats on lifting the ceiling (which could lead to a major economic crisis in a few months). Suddenly, I thought to myself, the entire reversal seems even more suspicious. Now here's my unpopular opinion : What if this is part of an elaborate plan to eliminate some of the debt? The world is dependent on the dollar, if the US financial system is in trouble, so is most of the world. Everything is just too interconnected at this point. Across the giants of investment world, there are rising concerns about unsettling markets and risking a recession. Senate Republican leader Mitch McConnell predicted that the debt ceiling would be lifted sometime in the first half of 2023 under conditions negotiated by Congress and the White House. According to Reuters, the White House is refusing to negotiate with Republicans on raising the debt ceiling because it believes that the majority of them will eventually back off their demands, as a growing group of investors, business groups and moderate conservatives warn of the dangers of edging towards a default. The high-stakes deadlock is widely expected to last for months, and could come down to the last minute as each side tests the other ahead of June when the U.S. government might be forced to default on paying its debt. A default means being unable to pay. Because U.S. debt is considered the bedrock of the global financial system, due in part to its stability, a default could shake economies across the world. Americans could also face a recession, including higher unemployment, and the stock and bond markets would likely plunge. Today, a government that defaults may be widely excluded from further credit; some of its overseas assets may be seized; and it may face political pressure from its own domestic bondholders to pay back its debt. Today on Twitter, Elon Musk said openly that even if the government taxes every billionaire by 100%, it wouldn't even make a notable dent. According to him, the only way to make a notable dent in this debt is to tax the citizens even more. But what about the markets, the whales, the insider trading between banks, governments and large corporations ?? Trading markets is a multi trillion dollar industry. To make it more practical, the total value of global equity trading alone was 41.8 trillion U.S. dollars in the third quarter of 2021. We know that the Total cryptocurrency market is currently standing just under 1T. I'm unable to find data on the total worldwide value of the commodity market, if you do please comment below with your source. It is estimated that the total amount of money in the world is a couple of quadrillion. Whatever that means. Suddenly, 30 Trillion seems pale in comparison. Furthermore, investment options go far beyond just stocks, cryptocurrency and commodities. Some of the other less frequently discussed options include: 1. High-yield savings accounts 2. Certificates of deposit (CDs) 3. Money market funds 4. Government bonds 5. Corporate bonds 6. Mutual funds 7. Index funds 8. Exchange-traded funds (ETFs) 9. Dividend stocks 10. Real estate Now imagine, scooping off a bit of cream from the top?? You wouldn't need to necessarily wipe out an entire market, but a good 20% to 30% drop across markets and Bob's your uncle ! The money machine carries on until next time it's overspent. Hike interest rates. Increases taxes. Inflation. Liquidate markets. Repeat cycle. So the point that I'm trying to get at is this - remember tot take profits. Nothing wrong with taking a hedge to manage your risk during these uncertain economic times. I personally won't be surprised if there's some major "news event" that sends the markets into a overnight flashcrash soon. I could be totally wrong, in fact I would prefer to be wrong in this case. What are your thoughts on this? _______________________ 📢Follow us here on TradingView for daily updates and trade ideas on crypto , stocks and commodities 💎Hit like & Follow 👍 We thank you for your support ! CryptoCheck
FRED:GFDEBTN
by CryptoCheck-
25
Will King Dollar Reign Again?The U.S. dollar has been in freefall since early November. But now there could signs of stabilization – at least in the near term. The first pattern on today’s chart of the U.S. dollar index is the 101.95 level. It was a weekly closing high from March 2020 before the Federal Reserve’s dovish policies pushed the greenback lower amid the pandemic. Notice how DXY bounced near this level last May and is holding it again this week. Second, the recent low represented a 50 percent retracement of the dollar index’s surge between May 2021 and September 2022. Third, stochastics are trying to rebound from an oversold level. Today’s big swings also produced an outside candle. Finally, the calendar might be a challenge with the Fed meeting two weeks away. A lot of hopes for more dovish policy have been priced in. Can it keep moving in the same direction, or will sellers look to cover before the news? TradeStation has, for decades, advanced the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more. Important Information TradeStation Securities, Inc., TradeStation Crypto, Inc., and TradeStation Technologies, Inc. are each wholly owned subsidiaries of TradeStation Group, Inc., all operating, and providing products and services, under the TradeStation brand and trademark. TradeStation Crypto, Inc. offers to self-directed investors and traders cryptocurrency brokerage services. It is neither licensed with the SEC or the CFTC nor is it a Member of NFA. When applying for, or purchasing, accounts, subscriptions, products, and services, it is important that you know which company you will be dealing with. Please click here for further important information explaining what this means. This content is for informational and educational purposes only. This is not a recommendation regarding any investment or investment strategy. Any opinions expressed herein are those of the author and do not represent the views or opinions of TradeStation or any of its affiliates. Investing involves risks. Past performance, whether actual or indicated by historical tests of strategies, is no guarantee of future performance or success. There is a possibility that you may sustain a loss equal to or greater than your entire investment regardless of which asset class you trade (equities, options, futures, or digital assets); therefore, you should not invest or risk money that you cannot afford to lose. Before trading any asset class, first read the relevant risk disclosure statements on the Important Documents page, found here: www.tradestation.com .
TVC:DXY
by TradeStation
Short STOXX EUROPE 600 OIL & Gas sectorWe are having here a very well structured trade idea, exploiting the confluence of high important technical factors, mean reverting stance, and extreme positioning in the Oil and Gas space thanks for a Long Inflation lean by most investors this year. Into year end and preparing for 2023, Fact is that after such a good performance some will be tempted to take profit especially with a potential FED pivot in [/b preparation based on Inflation peaking. Saying it simply and pragmatically : if you made money being long the sectors or High dividend stocks in that space, that's a great achievement, but the forward looking factors are clearly pointing lower. the USD price action is clearly indicating of Inflation peaking and is highly supportive of this trading idea. Bottom line: Sell / Short SXEP Sector using this Multi Month horizontal trendline and overbought technical indicators
EUREX:FSTE1!Short
by ArisopeCapital
1
ES/SPX Short/Put entry Weekly Chart shown and Daily Fed Net liquidity indicator applied. This indicator shows fed inflow/outflow money’s based on their Quantitative tightening and easing (denoted by the green line). As you can see by looking at the circles drawn in, when Net liquidity becomes meaningfully extended above the price action, price eventually makes its way there, and the same goes with when the NL under-extends. Currently SPX is $4009 and its fair value (denoted by the Net liquidity indicator) is $3790 as of 1/16/23. We are clearly down trending as we keep rejecting off the trend line. The play here looks to be an entry around $4050-4100 near the upper region of the trend line and a short all the way down to $3790. This is interesting as it would likely ripple over to $BTC and cause it to also decline. Looking for this to play out around the end of February or early March.
CME_MINI:ES1!Short
by Stellurz
Ridiculous play incomingMarket trying to front run the fed, and trying to convince fed itself that fed is going to pivot XD (like a bunch of degenerates). And celebrating the likelihood of 25 bps like it's the start of bull market, even though several members of the fed this week have been hawkish. Even Jerome Powell himself has said, fed will have to do something the majority wouldn't like. Anyways this is kind of ridiculous but here is my expectation XD. Currently we got rejected several time near the year long bear channel resistance.
OANDA:SPX500USDShort
by jobanis
4
Where is the EURUSD headed amid the EU and US inflation lag?We hope everyone had a great start to the year! As we think about the year ahead and some of the major themes that might play out, the EU vs US inflation story is among those catching our eyes now in particular. “Inflation” & “Rate Hikes” were the main talking points for the US Economy in 2022 as the US Federal Reserve (Fed) reacted and adjusted to stubborn inflation. On the other side of the Atlantic, a similar situation is playing out, albeit with a 4 to 7 months lag behind the US. Measuring the difference between the turning points, we can roughly determine the lag between the economic indicators. Headline Inflation (top chart) in the US moved up close to 7 months before the EU’s. Core Inflation (middle chart) in the EU lags the US by 5 months. Policy reaction (bottom chart) of the European Central Bank (ECB) lags the Fed by 4 months. This dynamic is important when trying to understand the path forward for the EURUSD currency pair as central banks watch inflation figures and adjust policy rates accordingly. EU & US policy rate differentials help us sniff out major turning points for the EURUSD pair. As seen in the chart above, the yield differential measured using CME Eurodollar and Euribor futures, started to widen in September 2021, which marked the EURUSD tumble from 1.160 all the way to 0.987. But now it appears the reverse is happening. Yield differentials are starting to close as markets adjust to slower pace of rate hike environment in the US while ECB still battles stubbornly high inflation. Using CME’s Fed watch tool as well as Bloomberg’s OIS Implied Euro interest rate probability tool, we can estimate the market implied forward path for the 2 major central bank’s policy rates. With the market expecting the Fed to pause rate hikes in March, while the ECB is expected to only pause in July. Interestingly, the difference in expected rate pivot is in line with the 4 to 7 months lag in economic conditions we established from the analysis above. As the ECB continues to hike while the Fed pauses, yield differential is likely to close, helping to boost Euro’s attractiveness against the USD. Coupled with the dollar’s downward momentum, This could favor further strength in the EURUSD pair. On the technical front, we see a golden cross with 50-day moving average crossing above the 200-day moving average for the pair. Coupled with an uptrend and spike in the RSI, it has marked the recent up trends remarkably well. If this historical behavior holds, the EURUSD pair could still have further room to run. For those who use Parabolic SAR, the current chart has just flipped back to a buy signal after the recent price consolidation. Given the ECB’s policy lag, dollar weakness, and a bullish technical setup, we lean on the buy side for the EURUSD pair. We set our stop at the 1.0520 level, and take profit level at 1.12800, with each 0.00005 increments per EUR in the EURUSD futures contract equal to 6.25$. Do also check out our previous EURUSD idea which played out nicely: The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Sources: www.cmegroup.com www.cmegroup.com Bloomberg
CME:6E1!Long
by inspirante
November Midterms + Bear Market Rally I believe we'll see a ferocious rally that will shock everyone and make everyone bullish again - but this will just be a bear market rally (this is my thinking unless we break below 800B) There is still a very good chance we continue down towards 500B MC and sit there for the next 12-18 months but I am not leaning too heavily on the short side at the moment. The democrats need something on their side, they don't have the market - everything comes down to whether they raise rates at the next meeting. 100bp points increase = market dump 75bp points increase = market dump 50bp points increase = market rally's hard Even the most bearish people agree we're due for a rally - even if it is a bear market rally - if we do get this rally it'll be the last one until we go into a long bear market/depression (this will be your last chance to exit your trades in crypto/equities)
CRYPTOCAP:TOTALLong
by InvestingIdeas9