Fomcnews
Favoring sells But sitting on Sidelines. Interest Rates⛔-->->EU I like the Risk to reward to the downside. However, and similar to Feb 1st Announcement, we could rip upwards to the Moon similar to first landing on the moon. We'll See what happens as we sit on the sidelines. Beware of position sizing during intraday scalping 1Hr after announcement. Which I have found typically to be the best time to trade surrounding news trading.
Price is currently sitting underneath our 1.08 Daily zone. If we decide to move up our next target will be 1.08539 Daily Level. Other than that we have rather clean traffic heading up on the 4hr. If the market determines that pessimism is strong enough, we will respect our daily level here at 1.08, and leave a wick of liquidity catching breakout traders to the downside. Going down, I can observe us reaching 1.074 Daily level relatively easy once again. Anticpating crazy volatility here. Those are expecatations but we could be disappointed. Manage expectations. Safe trading.
FED Interest Rates and it's mechanism BINANCE:BTCUSDT
In the United States, the federal funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight on an uncollateralized basis. Reserve balances are amounts held at the Federal Reserve to maintain depository institutions' reserve requirements. Institutions with surplus balances in their accounts lend those balances to institutions in need of larger balances. The federal funds rate is an important benchmark in financial markets.
The effective federal funds rate (EFFR) is calculated as the effective median interest rate of overnight federal funds transactions during the previous business day. It is published daily by the Federal Reserve Bank of New York.
The federal funds target range is determined by a meeting of the members of the Federal Open Market Committee (FOMC) which normally occurs eight times a year about seven weeks apart. The committee may also hold additional meetings and implement target rate changes outside of its normal schedule.
The Federal Reserve uses open market operations to bring the effective rate into the target range. The target range is chosen in part to influence the money supply in the U.S. economy
Financial institutions are obligated by law to hold liquid assets that can be used to cover sustained net cash outflows. Among these assets are the deposits that the institutions maintain, directly or indirectly, with a Federal Reserve Bank. An institution that is below its required liquidity can address this temporarily by borrowing from institutions that have Federal Reserve deposits in excess of the requirement. The interest rate that a borrowing bank pays to a lending bank to borrow the funds is negotiated between the two banks, and the weighted average of this rate across all such transactions is the effective federal funds rate.
The Federal Open Market Committee regularly sets a target range for the federal funds rate according to its policy goals and the economic conditions of the United States. It directs the Federal Reserve Banks to influence the rate toward that range with open market operations or adjustments to their own deposit interest rates. Although this is commonly referred to as "setting interest rates," the effect is not immediate and depends on the banks' response to money market conditions. Separately, the Federal Reserve lends directly to institutions through its discount window, at a rate that is usually higher than the federal funds rate.
Future contracts in the federal funds rate trade on the Chicago Board of Trade (CBOT), and the financial press refer to these contracts when estimating the probabilities of upcoming FOMC actions.
When the FOMC wishes to reduce interest rates they will increase the supply of money by buying government securities. When additional supply is added and everything else remains constant, the price of borrowed funds – the federal funds rate – falls. Conversely, when the Committee wishes to increase the federal funds rate, they will instruct the Desk Manager to sell government securities, thereby taking the money they earn on the proceeds of those sales out of circulation and reducing the money supply. When supply is taken away and everything else remains constant, the interest rate will normally rise.
The Federal Reserve has responded to a potential slow-down by lowering the target federal funds rate during recessions and other periods of lower growth. In fact, the Committee's lowering has recently predated recessions, in order to stimulate the economy and cushion the fall. Reducing the federal funds rate makes money cheaper, allowing an influx of credit into the economy through all types of loans.
BTC Ready To Dump Fast And Hard-Crash Is ImminentBTC/1H Still in that Parallel Upwards channel
*I FORGOT to mention there is a ascending triangle pattern on btc which I think its jebaiting the longers*
Today is FOMC day where rate hike will be announced and will have huge impact on whole market , not only traditional but crypto as well.
We usually get a move to both side around (%3) liquidating all the high leverages which we call ( sweeping the highs and lows) after than the move will come
IMO its a capitulation candle downwards around 23K. could be worse .
Thanks you for watching-
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VIX: MICRO VOLATILITY CYCLES / POINTS OF CONTROL / MACD & RSI DESCRIPTION: In the chart above I have provided a MICRO ANALYSIS of the VIX INDEX which represents volatility in the overall US MARKET. This is a short term play for this week based on micro volatility cycles.
POINTS:
1. Deviation in critical thresholds is 4 points a small adjustment from previous VIX charts published as volatility adheres to this more often.
2. 23 Point serves as critical support for VIX.
3. Current Trend = Symmetrical Triangle Formation 2nd Phase
4. Overlapping Green Dotted Lines = Market Open
5. Overlapping Red Dotted Lines = Market Close
IMO: In my opinion whether or not current setup becomes invalidated I do not see current price action falling below 23 POINTS is the POINT OF CONTROL TO THE DOWNSIDE while 31 POINTS is the POINT OF CONTROL TO THE UPSIDE.
MACD: Current MACD levels continue to fall and are bound to flip into negative territory further confirming current setup that needs some pullback for VIX.
RSI: Current RSI levels are dropping and no current signs of DIVERGENCE that would indicate a sudden flip to positive territory.
SCENARIO #1: VIX price action agrees with current setup & respects symmetrical triangle setup and bounces off 25 in coming session & precedes to the upside to break 29.
SCENARIO #2: VIX price action disagrees with current symmetrical triangle setup and breaks below 25 & faces possible bounce at 23 instead.
FULL CHART LINK:https://www.tradingview.com/chart/UUCv2fGk/
TVC:VIX
AMEX:UVXY
DXY ( Dollar Index)During Friday's New York session, on the 4h TF, there was a strong bearish candle. Mostly, on the 4H TF, whenever there's a strong bearish/ bullish candle. price will re-visit where it once started which is 104.200.
Eyes on the 50 ema which might cut price bearish move at 103.19-18, for a bull run into 104.2
Eyes on the FOMC on Wednesday
#DXY
NQ Power Range Report with FIB Ext - 2/1/2023 SessionCME_MINI:NQH2023
- PR High: 12121.50
- PR Low: 12096.00
- NZ Spread: 57.0
Evening Stats (As of 12:05 AM)
- Weekend Gap: N/A
- 8/19 Session Gap: -0.04% (open > 13237)
- Session Open ATR: 260.07
- Volume: 19K
- Open Int: 275K
- Trend Grade: Bear
- From ATH: -27.9% (Rounded)
Key Levels (Rounded - Think of these as ranges)
- Long: 12391
- Mid: 11820
- Short: 10678
Keep in mind this is not speculation or a prediction. Only a report of the Power Range with Fib extensions for target hunting. Do your DD! You determine your risk tolerance. You are fully capable of making your own decisions.
BTC updateMy BIAS also has changed on BTC. Bitcoin is weak, parallel with DXY who is broken out, heading towards supply zone. Reverse my setups after new target is hit.
Looking for a "clean" short setup...
The FOMC meeting will disrupt the market again. Will increase my positions after volatility clears up.
Be alert!
BONDS YIELD PREDICTION!!!!! US02YDESCRIPTION: In the chart above I have provided a macro analysis for 2 year bond yield on the Daily Timeframe.
POINTS:
1. Since the beginning of this upward trend on January 2022 we have seen that bonds and the overall market are said to share an inverse relationship but during pivotal moments that has not been the case as you can see that the stock market has risen along with bonds and vise versa .
2. Deviation in SUPLY & DEMAND POCKETS is clearly shown to be every 1% RISE IN YIELDS . (Refer to BLUE & ORANGE Horizontal Lines)
3. Before entry is made into a new DEMAND POCKET price action has a distinctive pump that has occurred several times. (Refer to white lines between SUPPLY & DEMAND POCKETS).
4. Predicted rise was formulated by using the average of previous last two pumps of +40.92% and +54.21% = +48% when rounded.
5. Average does in fact coincide with previous point of resistance when bond yields rose to 6% in the early 2000's. (A POINT THAT I WOULD CONSIDER TO BE A PIVOT POINT)
6. When you observe MACD we can also conclude that downward pressure is looking for relief like in past occasions.
SCENARIO #1: Bond Yields continue to rise and follow uptrend into early 2023 which can then signify that a market bottom is yet to be confirmed.
SCENARIO #2: Bond Yields break crucial SUPPORT OF 4.000% and will invalidate current setup. Possibly being followed by capitulation in the stock market since falls in yields seem to be more closely tied to falls in the overall market than the inverse relationship.
TVC:US02Y
Bitcoin~$15k or even lower soon!Hello Traders,
Happy New Year, I hope we can see some positive movements in 2023, but the market disagrees.
As you know already, FOMC minutes was just released today, and the result wasn't good, and Bitcoin rejected right at the resistance again. I expect to see new lows in the upcoming days/weeks. The fed still insists on the rate hikes policy in 2023, and we won't see cut rates this year.
Please hit the boost button if you agree.
Thanks, and don't forget to follow me for more updates.
Trade safe.
FOMC Economic Projections Effect on GoldOANDA:XAUUSD
**Repost from Dec 14th 2022 since the original post disappeared**
Hello all TradingView speculators,
In my opinion, I think there was an overreaction from the market's participation on the CPI numbers that was announced to be lower than expected. In addition to this, some technical indicators are showing us some signals to be careful on the buy side from bearish divergence signal between the price and RSI on 4H timeframe. This indication does not mean that the trend will reverse immediately but it indicates that the current trend has chances of stopping and turn into either sideway or downtrend in short term.
Based on the current price level, Risk to Reward Ratio seems to be in favor of the bears. However, I would wait to see the price action in 1H timeframe tries to test 1815 first and if it fails then I believe that follow sell position after this price action fails to go above 1815 and if price makes a lower low below 1804 can be a worthy trade
eurusd , shortAfter hitting the ceiling of the descending channel , the euro-dollar entered correction and will move towards the ceiling of the channel after correction again.
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6 Reasons why the gold price will drop with interest rate hikes The FOMC announced another 50bps (0.50%) Interest Rate increase to 4.50% which has lead to short term downside for gold as an initial reaction.
The question for many remains.
Why does gold drop when interest rates rise?
There are a number of reasons, but here are the top 5…
#1: Investors look elsewhere
Higher interest rates can make other investments, such as fixed investment assets and bonds, more attractive to investors. Gold investors will then sell their gold holdings and take advantage of higher interest rate yielding assets. This can lead to investors moving their money out of gold, which can lead to a drop in price.
#2: Stronger U.S Dollar
A higher U.S dollar can lead to gold being more expensive for investors who use other currencies to buy it. This can lead to a drop in demand for gold, which brings the price lower.
#3: Higher borrowing costs
When interest rates rise, this increases the costs of borrowing for business and consumers. They now need to pay more to borrow money to fund their operations. This can hamper the economic activity and drop the demand for buying stocks, precious metals and other investments.
#4: Higher yields on gold-mining companies bonds
Fixed investment gold bonds may seem more attractive than holding and investing in gold itself. This leads to a drop in gold mining stocks which essentially helps with the drop in gold.
#5: More supply less demand
With the factors I mentioned above, with investors leaving gold this increases the supply of the metal and decreases the demand. This leads to a drop in the gold price.
#6: Uncertainty floods the markets
When interest rates go up, this leads to uncertainty in financial markets (where gold is no exception). Investors feel the uncertainty and become worried for the economy. This can lead to a decrease in demand for gold and a drop in its price.
These are all speculations in theory with why the gold price may drop with an increase in interest rates. We notice that the markets don’t always play according…
Since the May 2022 Gold has moved in a sideways consolidation pattern. And this means, we can see the price continue in the range. Until we actually see a break up or down, the analysis in the medium term is sideways. We’ll be watching this carefully.
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Timon
MATI Trader
Higher interest rates can also lead to higher yields on gold-mining companies' bonds, which can make these bonds more attractive to investors. This can lead to a decrease in demand for gold-mining stocks and a drop in the price of gold.
Higher interest rates can also increase the opportunity cost of holding gold, as the metal does not generate any income or interest. This can make investors less likely to hold onto gold as a long-term investment.
Gold is often seen as a hedge against inflation, and higher interest rates can signal that the central bank is trying to keep inflation in check. This can reduce the perceived need for gold as a hedge and lead to a drop in its price.