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Pound lower, retail sales reboundThe British pound is in negative territory in the Friday session. GBP/USD is currently trading at 1.3450, down 0.35% on the day. UK retail sales for October surprised the markets, as the gain of 0.8% m/m was the first gain in five months. Clearly good news, but the improvement could well be due to early Christmas shopping rather than a change in the mindset of consumers, who have been slow to spend since the end of the lockdown in the summer. Consumer confidence has been weak as caution is the mantra in what has been a difficult year. On an annual basis, retail sales fell by -1.6%, which follows a read of -1.1% in September. Inflation continues to accelerate as the "transient" narrative seems out of sync with what is happening on the ground. The UK consumer price index hit 4.2% y/y in October, above the consensus of 3.9%. The data will add to the pressure on the BoE to raise interest rates at the December policy meeting. The bank held rates at the November meeting, which shocked the markets, as Governor Andrew Bailey had sent strong hints that the bank would raise rates in order to contain inflation. The BoE is projecting inflation to go as high as 5% in early 2022 before falling lower in 2023. After being burned by the BoE, investors will be mindful about projecting a December rate hike, but it's clear to everyone that the bank will need to raise rates shortly - if not in December, then early in the New Year. With no tier-1 events out of the US today, the markets are focusing on President Biden's choice for Chair of the Federal Reserve, which should be announced on the weekend. Jerome Powell was considered a strong favourite until recently, but Fed member Laura Brainard could be a surprise choice. Brainard is considered more dovish than Powell and would be expected to raise rates more slowly. If Brainard wins, we could see an immediate reaction from the markets and the US dollar could lose ground. GBP/USD has support at 1.3310. Below, there is support at 1.3206 There is resistance at 1.3562 and 1.3710
by OANDA
TYX 30 Year Bond YieldWith Fed Powell having his big speech last week, I wanted to take a look at the TYX which is the 30 year treasury bond yield. Although he noted that they won't necessarily hike interest rates in the short term, he did say that he would consider doing so Q2 and above depending on job growth and GDP growth. There was also a clear warning that the Fed would pullback on some of the bond purchasing two times in November and December going into 2022. The TYX normally responds to this in a bullish manner. With the CPI reports being the highest since 1990, consumers are taking hits with having to spend more money for the same products. In the most recent months, this hasn't really mattered to the average consumer. However, if the CPI reports continue to come in higher than forecasted, I'm sure that those same consumers would start pulling back their expenditures. Now taking a look at the chart, my focus is on the Daily TF where there seems to be a bullish flag forming and or an Eve and Eve double bottom that could be in the midst of forming if consolidation persists within the next 3 months. The Mac D indicator seems as if it needs to retrace the previous high and it has already surpassed the 38% retracement level and am looking for a bullish move out of the flag to reach the 61.80% retracement. If this happens and we cross above the 200 ema (already happening on the 15 min) we could be back in the 2's at some point in the near future. What do you think? Like, follow, agree, disagree! Not advice! Just an Idea!
TVC:TYXLong
by Redimere_91
Bitcoin Short Setup! ABC elliot wave correctionFull short elliot waves setup headed to 44000 to 48000 USD is finally here!. Some many bullish comments you heard: "november 80k"...."December 120k target cause stock to flow model"... too much FOMO I presume. We strongly believe on an end cycle have been reached this time and Bitcoin needs to correct 20% - 35% at least to keep an ascendend steps like it was in the past. Some few reasons to considery it: 1- FED Tappering it's here. 2- Inflation rate on historical highs. 3- Evergrande default and some few chinese institutions with high loans and no liquidity. 4- Bitcoin market makers are watching peoples FOMO. 5- Bitcoin Bearish Rising wedge Elliot waves and chart features: 1- Logarithm chart 2- Wave A: 55500 - 58000 Wave B: 60000 - 63000 Wave C: 44000 - 48000
Short
by maugigli
7
The Road To Normalcy Begins (06 November 2021)Fed starts tapering! The long-awaited taper meeting has finally arrived! The Federal Reserve announced during their monetary policy meeting on Thursday that it will begin slowing down its net asset purchases by $15 billion per month which comprises of $10 billion Treasury bonds and $5 billion agency mortgage-backed securities. The first round of tapering will begin later this month and the second round will take place at the beginning of December. Moving forward, the monthly pace of quantitative easing (QE) tapering will be similar to these two months and may be adjusted depending on the economic outlook. Regardless of the pace, the Fed is expecting QE to end by mid-2022. The following illustration shows that under the same tapering pace, QE will end in June 2022. Nov 2021: $70b Treasury Bonds + $35b Agency MBS Dec 2021: $60b Treasury Bonds + $30b Agency MBS Jan 2022: $50b Treasury Bonds + $25b Agency MBS Feb 2022: $40b Treasury Bonds + $20b Agency MBS Mar 2022: $30b Treasury Bonds + $15b Agency MBS Apr 2022: $20b Treasury Bonds + $10b Agency MBS May 2022: $10b Treasury Bonds + $5b Agency MBS Jun 2022: End of QE A small step back on “transitory” With the recent comment made by Fed Chairman Powell that supply bottlenecks will take longer to ease, thus expecting prices to remain high for a longer period of time, the Fed has taken a small step back from its view on inflation being transitory. The previous confidence that the elevated inflation “largely reflecting transitory factors” has now been revised to “largely reflecting factors that are expected to be transitory”. During the press conference, Powell also clarified the definition of “transitory” that the central bank adopts after highlighting that the word has different understanding to different people. For the Fed, “if something is transitory it will not leave behind permanently – or very persistently higher – inflation”. With the ongoing supply chain disruptions, the central bank Chief is expecting inflation to continue its rise into 2022 before easing back down during mid-2022. Maximum employment still quite a distance away Although tapering of the massive $120 billion per month QE programme has begun, Powell warned that the Fed’s decision to do so does not imply a rate hike is underway. The central bank held its interest rate unchanged at the targeted range of 0-0.25% and would like to see the labour market achieve maximum employment before considering a hike. As of the October’s jobs report, the U.S. job market is still some 5 million jobs away from the pre-pandemic level. The Fed is likely going to consider a rate hike only when the jobs lost during the pandemic have been fully recovered. Even so, the central bank may wait a little longer to be certain that jobs growth is indeed consistent before committing.
TVC:DXY
by GH_Lee
3
Pound's woes continueThe British pound has extended its losses in the Friday session. GBP/USD is currently trading at 1.3445, down 0.41% on the day. It's been a miserable week for the British pound, which is down 1.76% this week. The driver behind the pound's slide was the BoE meeting, as policy makers caught the markets off guard when they opted to maintain the cash rate at 0.10%. Governor Andrew Bailey had strongly hinted that that bank would raise rates at this week's meeting, but in the end, the MPC voted 7-2 to stay put, with Bailey among the majority. Bailey noted that the decision had been a "close call", but the markets reacted sharply, with the pound plunging 2.2% since the BoE's surprise non-move. The BoE has said it will raise rates in the "coming months", but is clearly under pressure to make a move soon, and it could be faced with a credibility issue if it chooses to sit on the sidelines at the December meeting. The fact that the BoE is still running a QE scheme while talking about raising rates is also a potential source of confusion for the markets, as the two programmes are inconsistent with each other. In contradistinction, the Fed has no plans to raise rates before it winds up its bond purchase program. Attention now shifts to the US, with the release of nonfarm payrolls later today. The consensus stands at around 450 thousand jobs added, and a reading above the 500 thousand level will reignite talk of an accelerated taper programme and possibly the Fed bringing forward guidance on a rate hike. That would likely give the US dollar a boost. Conversely, a print below 350 thousand will dampen rate expectations and likely weigh on the greenback. GBP/USD continues to break support levels as it falls lower. The pair is testing support at 1.3471. Below, there is monthly support at 1.3253 There is resistance at 1.3570 and 1.3632
by OANDA
Has The USD Avoided The Dreaded Taper Tantrum?With its back up against a wall, the US Federal Reserve has pledged to begin tapering its asset purchase program. Beginning later this month, the Federal Reserve will reduce the number of US Treasury Securities it purchases each month by US $10 billion and the number of Mortgage-Backed Securities by US $5 billion. How did the USD react to the Federal Reserve announcement? By all accounts, a dreaded ‘taper tantrum’ has been avoided in the wake of the announcement. At least in relation to the forex market. Federal Reserve chairman Jerome Powell has been extremely careful to prime investors for this moment. For one, all hawkish commentary from the chairman has been mediated with dovish caveats. Admittedly, less senior Federal Reserve officials have done much of the leg work in hinting and out-right suggesting the need for a reduction in its purchases. Either way, the conversation surrounding tapering has been sustained for months, giving investors time to mull over the implications. As of writing, the USD index, the DXY has crossed back over the 94.00 mark and comfortable sits 94.33, up 0.53% since the Federal Reserve’s tapering announcement. Will the Federal Reserve continue to taper? The Federal Reserve will still be purchasing $105 billion worth of securities, with further reductions dependent on continuing favourable economic outlook. The Federal Reserve has indicated it is considering reducing spending, month over month, moving forward. However, if economic conditions deteriorate, the spending reductions could be nullified or reversed. The Federal Reserve will be keeping an eye on inflation and the number of jobs added to the economy each month. Inflation remains at a decade high A significant consideration of the Federal Reserve when determining its reduction in spending is the US inflation rate. While it is at a 13-year high, the Federal Reserve maintains that most of the inflation experienced heretofore is temporary. Octobers inflation number is released next Wednesday. Trading Economics is forecasting a 0.1% increase in US inflation. Up next: Non-Farm Payroll Another significant consideration of the Federal Reserve when determining its tapering is the Non-Farm Payroll (NFP). The NFP indicates how many non-farm jobs were added to the economy in a given month. The data for the October non-farm payroll will be released tonight to great anticipation. Trading Economics is forecasting 400K jobs, while the market consensus is a little more optimistic and is forecasting 450K jobs. The NFP has disappointed for the past two months, with actual job figures falling far short of the numbers predicted. Even so, the Federal Reserve has seen fit to begin tapering as job growth seemingly slows. Treasury Security Janet Yellen noted the US economy is still short 5 million jobs compared to pre-pandemic times, which will take the US years to recover at the current rate of job growth.
TVC:DXY
by BlackBull_Markets
Euro dips to 3-week low as Fed trimsThe euro is down considerably in Thursday trade. Currently, EUR/USD is trading at 1.1550, down 0.53%. Earlier in the day, the euro fell to 1.1528, its lowest level since October 13th. There were no surprises from the Federal Reserve meeting, as policy makers trimmed the QE programme by 15 billion dollars/month. The move was nonetheless highly significant, as it marks the first tightening in policy since QE was introduced as a response to the economic downturn in early 2020 due to the Covid pandemic. Although the move was communicated to the markets in advance, it was unclear as to how much the Fed would trim, and an amount other than 15 billion dollars could have shaken up the US dollar. The Fed's move was aptly described as a 'dovish taper', in that the Fed continues to maintain a dovish stance as far as future rate hikes and inflation. Fed Chair Powell said after the meeting that the bank would remain patient and wait until the job market was stronger before raising rates, emphasising that the Fed would encourage job growth through low rates. As for inflation, Powell stuck to his well-worn script that the current bout of high inflation is "expected to be transitory" and will ease lower. Powell appears to be odds with the markets, which are far more hawkish and have priced in several rate hikes for 2022. Inflation has been running at 4% over the past five months (double the Fed's target) and it's becoming a stretch to argue that this is a transitory trend, with no sign that inflation will cool anytime soon. What is interesting is that other major central banks are also preaching patience and arguing that high inflation is transitory. Earlier today, the BoE surprised the markets by maintaining rates; the BoE had signalled that it would raise rates in order to contain inflation. However, the BoE echoed the Fed when it stated today that the factors causing high inflation were transient and that it expected inflation to ease in several months. The ECB is also singing from the same hymn sheet - the bank has projected that inflation will be "subdued" in the medium term, and earlier in the week, ECB President Christine Lagarde said that the bank had no plans to raise rates in 2022. There are resistance lines at 1.1658 and 1.1754 1.1501 is providing support. This line has held since July, but was under pressure earlier in the day. Below, there is support at 1.1440
by OANDA
It is the FED day The markets are likely to choose a directional price path after the announcement and press conference that will wrap up around 3 PM Eastern. While the market is pricing in hiking, it’s not actually pricing in tightening. Or to put it another way, it’s not pricing in the kind of move that would meaningfully slow down growth or inflation. Aspen Trading S/R levels are showing resistance @ 4,628.25 and we should wait for the market direction after FED announcement. Overall, SPX500 looks really good for a bullish move to the upside. Please like, share and follow if you agree with the analysis. Note - Aspen Trading S/R levels are invite only. They can be accessed through my profile information. Disclaimer: This analysis is for information purpose only and does not constitute any investment advice.
FX:SPX500Long
by tradingswift
INTEREST RATE DECISION IMPACT II. PARTI think we are nearing the end and just like the Federal Reserve help to put the bottom in in March of 2020 I think they are going mark the top in at the end the this year making (2021). How the mechanisms work in short. At this point in a long-term economic cycles you seen the financilization of everything near the end of the dominance of economies that only global reserve currency becomes one trade. Business Land Stores of valu All move in tandem against the currency at the sole discretion of the Central Bank We've seen in last two years unprecedented money supply in the intervention in our economy by the Central Bank that results have been record high asset prices and record-breaking inflation. Federal Reserve faces unpopular decision holding back on it easy money policy. Its comes in two forms either raising interest rates or selling assets. The FED currently doing which is buying acsetss injecting new money what they will do in near future is selling assets thus they will extract money from the economy . They stated very clearly the economy is not yet strong enough to raise interest rates. Thus the first thing that they plan on doing is reducing assets purchases and then after that point they will start selling and raising interest rate at some point. Timeline for this when will this tapering will happen and when will cause a crash as result of tightening would definitely not happen until at least tigtening begins so its pretty much rules out this year because they've stated that they're gonna let us know when it's going to happen . The earliest that begin to reducing asset purchases is closer to the end of this year but it does take a little bit of time for the effect of monetary policy to be felt in economy. The effect does not will be inmediant, but for you at time need to positioneted your assets accordingly. We have time , which is great but if we step earlie we gonna leave money on the table. FED TIMELINE According to the Federal Reserve with light to have their total asset purchase per month down 0$ purchases by the end of 2022 if not a little bit earlier. Current120 billion dollars ( min) In the next part I will let you know why they need hike rates, and how its connected with Joe Biden agenda. Now the most important things to interpret the coming message from Jeremy Powell on Wednesday. Please look after if you dont know M2 money supply
U
by ElGatoTrade
Will Jerome Powell Bury Gold Miners?The VanEck Gold Miners ETF has had a countertrend rally this month, rebounding from a 17-month low. But now could be the time sellers return. The first pattern on today’s chart is the $33.25 price zone. GDX bounced at this level in November and July. It marked the high in early September and seems to be resistance again this week. Next, stochastic has been in an overbought condition. This reading also marked tops in May, August and September. Third, consider upcoming events like the Federal Reserve meeting and non-farm payrolls next week. Those could potentially boost interest rates and the U.S. dollar, which may be negative for precious metals. Finally GDX is forming an inside week, a potential sign of its recent bounce slowing. This pattern also occurred at tops in August 2020 and May 2021. (See below.) TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
AMEX:GDXShort
by TradeStation
Bitcoin (BTC/USD) Daily Chart Analysis For October 23, 2021Technical Analysis and Outlook: As to technical analysts, the next drive higher will meet the target of Key Res $65,990, and retest of completed Inner Coin Rally marked the same. The downside support is Mean Sup $57,400 and Key Sup $ 53,900. However, the present fractal model suggests that the next significant target of interest will be the Impending Outer Coin Rally marked at $81,330 - Flagged by Trade Selecter many moons ago.
BITSTAMP:BTCUSD
by TradeSelecter
Analysis of the Federal Meeting todayThe meeting of the members of the Federal Reserve was held today at 17:30 Iranian time. In this post, we will analyze his speech and the direction of the market. Remarks by Mr. Powell US Federal Reserve Chairman Jerome H. Powell said in a statement today: 1- Inflation is expected to decrease 2- Trying to control inflation and employment 3- Reduction of inflation in the first half of 2022 4- Waiting for the debt limit to be lifted Conclusions from Powell's speech: The United States is working to boost trade and businesses in the post-corona era by increasing liquidity. This increases inflation by increasing liquidity For this reason, increasing liquidity increases inflation and, due to the higher cost of using labor and consumer goods, creates a catastrophe (similar to Iranian policy) if left unchecked. Mrs. Yellen's words US Treasury Secretary Janet Louise Yellen said today that I would like to make a few points: Waiting for the debt limit to be lifted Failure to raise the debt ceiling would be a disaster Market reaction to these negotiations: The US dollar index (DXY) fell from 94.373 to 94.107, after which the gold and currency pairs on the right side of the US dollar entered an uptrend. In the currency pairs that have reached the bottom, you can now expect an upward trend. Please follow me and like this post. I'm on Twitter too. (Trying to be the best)
TVC:DXY
by mohamadrezaKhorsand
3