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Inflation - Interest Rate - Market OutlookThe graph above shows the correlation between the Interest rate, Inflation and the SPX500. (Max timeframe by tradingview) Once the Inflation goes up, the FED tries to up the interest rate. Once it reaches a plateau and goes sideways, the market goes down ("soft landing", "growth recession","please insert"). So far we didn't reach the peak of rate hikes by the FED, the inflation is still extremely high. So far there is no reason to be bullish again about the SPX500 . How a "soft landing" is possible, idk. Historically, the market has to contract and SPX500 should go down during the next 6 months.
SP:SPX
by zzaaiiggaa
US Dollar Index ForecastDemand for the dollar is usually high as it is the world's reserve currency. Other factors that influence whether or not the dollar rises in value in comparison to another currency include inflation rates, trade deficits, and political stability. The dollar has been gaining strength against the currencies of other major economies. The dollar is strong because the US economy is healthier than those of many other countries and because the Federal Reserve keeps raising interest rates. Does the dollar get stronger with higher interest rates? But the overriding reason for the strong dollar is the fight against inflation. The Federal Reserve is ratcheting up interest rates to attack the current near-constant rise in prices and said last week it expects more hikes this year. As it continues to raise rates, the dollar will strengthen. <-- https:// tradingeconomics.com/ united-states/ interest-rate ---> How do bond yields affect the dollar? Bond yields actually serve as an excellent indicator of the strength of a nation's stock market, which increases the demand for the nation's currency. For example, U.S. bond yields gauge the performance of the U.S. stock market, thereby reflecting the demand for the U.S. dollar. <--- https:// ycharts.com/indicators/ 10_2_year_treasury_yield_spread --->
TVC:DXYLong
by domotswiri
Actual end of an era. And it is happening fast.Western interest rates starting going back up in the end. Looks like the whole "new paradigm" is over. Money is not free anymore. To sum up: - Boomers got 110% of the wealth (other generations are in debt), they are aging and getting more conservative, covid got them even more scared and conservative (risk averse); - Generally investor outlook on the economy which was not even positive for the last 20 years (buybacks and money printing were the bulls) is now rather negative; - Average people are starting to notice the money printing. Memes and permabears are doing their jobs. And those that do not notice want to go far right or far socialist even thought they have no clue why they want to. So central bankers cannot continue to print to infinity; - All the indicators clearly show people are not spending or lending their money since early 2020, they are hodling, no arguing is possible (unless the data is somehow incorrect), it is necessary to somehow entice them (with higher rates) to get that money; - And boy does the west need the money Bonus (technical): - Well just look at it go I'm going to go straight to the point and not go into a lenghty explanation about every point. i doubt many beginners are reading about the bund anyway. A shame, might be easy money... The TA/chart reminds me of the typical textbook stairs up elevator down chart. Reminds me of AUDJPY when the "housewives" were mass buying the AUD because of high rates, and then all ran for the exits in just months. In the case of bonds people are not running for the exits but it's the same idea mirrored. People with $$$ are not as eager to lend it anymore, and euro governments need as much magical ponzi beans as they can get to bounce back from the whole covid thing, and maintain fake prosperity and power for a few more years... or months. Well french president Emmanuel Macron said "abundance is over" and warned we should get ready, so at least he is honest. Germany has been teaching its population to warm itself without electricity last year. France relies on nuclear power but hey guess what french nuclear worker are on strike, french favorite national passtime. People have been spending less as you can see in this chart. So it takes a bigger carrot on a stick to get them to lend it. Reminder: velocity of money is the frequency at which it is spent. Lower value on the chart means people are holding tight on their liquidities more. Hey, people thought the USD not going to zero with all the printing and government spending and usstock bubble getting inflated would have no downside. Ye investors were buying us dollars because they were optimistic and just super bullish on this awesome not-a-scam currency and us economy right. I am also short on oil price will go down but for all the bad reasons, I'm feeling like the barrel price will be low low low but price at the pump will be high high high which won't even matter since the gaz station probably won't even have gaz. Boomers got all the money and boomers are aging, and scared to die soon, they are starting to not care about progress. Average humans stay in denial so long, but once panic starts to hit does it go fast. Any herd thing goes fast. I mean ask anyone that studies crowds. Mindless reptilian brains (85% of the population) at a concert watch a dozen people dancing like they are martians, they think they are so weird, then a few zombies start to dance and it's like a nuclear chain reaction all the zombie-sheep dance in seconds, only a dozen people are not dancing and the zombies stare at them and think they are weird stuck-up psychopaths. One could potentially take at least 5R, even 10-15 if it accelerates down (/up). Does it get harder and harder to find people to lend money (especially as high IR makes people/boomers scaaaared we are becoming Argentina)? Or will the increasing rates convince more and more people to lend? No one actually holds cash do they? Apart from boomers people have between $0 and 50k in debt and I am not making that up (most experienced traders know this). A handful of people we call traders have cash and they definitely are going long the interest rate (short the bund contract) - a few hundred retail traders going countertrend is like a few hundred mosquitoes trying to stop a herd of thousands of raging elephants, ye good luck guys just #HODL. They could continue to monetize the debt and rob poor people, but poor people even thought they have no idea what is going on are starting to get pissed, want to destroy everything and go socialist or far right. When I say poor people I really mean middle class, from low middle class to upper middle class. So every one except hobos collecting food stamps and Bezos & friends. Plus with the democratization of trading in part because of crypto and Robinhood, as well as permabears Peter Schiff and Mike Maloney reaching millions of people on social media, people are starting to figure out what is going on. Even the US socialists have mentionned taxing unrealized gains, I am scared, why do they know about this? Guess what happens when old people hold all the money? Guess what happens when those were promised they would live forever with magical futuristic cyber hearts? Guess what happens when hospitals are getting more and more expensive and they might (immediately) need all the money they have to afford lifesaving intervention (or they could just stop overeating but we all know this is not going to happen). I wonder if covid reminded them of their mortality and they are done investing for the long term, or at all. I wonder if some lost trust in the west capacity to pay back, but I do not have the answer to that it is not part of the analysis. I know "10/10 AAAA++++" France got downgraded years ago. They should all get downgraded really but will they? In 2008 junk bonds did not get downgraded... Well anyway... I don't want to predict the future or be a lifetime permabear I just want to make some money. We are traders we do not care if everything implodes do we?
OANDA:DE10YBEURShort
by MrRenev
DXY: Nearly At Trendline Resistance DXY: Nearly At Trendline Resistance This massive DXY pump might finally be coming to a short term end before an incoming correction - this sits at approx. 116.83. A shorter term rejection back to $107 is expected here where we could see a likely bounce with further downside to the lower side of the ascending macro channel at 103 region. This will be make or break for the DXY whether it gets back to its upwards trajectory or sinks back to normality and sub 107 where it has spent the vast majority of its life.
TVC:DXYShort
by Kryptochristian
2
Great Trades are Rarely Crowded: Long TLT and Short Twitter IQEveryone is a good trader in a bull market, but in a bear market, these good traders are reduced to hopium-fueled twitter analysts watching core CPI and interest rates. The former and latter data points serve nothing more as useless, out-of-context generalities for the single-celled Wall Street Bet retail enjoyer. But recent activity across the pond has sparked interest in the bond. These traders are now converting en-masse to self-proclaimed bond market experts with the thesis: "The bond market is broken" Except, the bond market is not broken. It is operating as intended, although two lines on a chart may disagree with anyone unfortunate enough to buy at the start of the year. Why is retail sentiment like this? The simple answer is that the fed is late, but a more-elaborate explanation follows: Bond yields rise because bond prices fall. It is the acquisition of a bond at a specific market price that determines that bond's yield, as a function of the difference between that bonds underlying rate (which is fixed) and the resale price. When interest rates rise, bond prices fall because newer bonds spawn with the higher base rate. This makes prior bonds, which have a lower fixed rate, less valuable because they output less extra cheddar. People then resell these bonds for a lower price and the yield rises according to market forces (the fed does not directly control this). Shorter duration treasuries follow interests rates very closely, whereas longer dated treasuries are difficult to influence by rate hikes. Either way these are secondary or tertiary market effects. This phenomenon is what results in an inverted yield curve: you can be paid more money to lend money for a shorter duration than a longer one. But why would something so illogical even happen? The answer is because the treasury market is not just any pig, it's a truffle-sniffing pig. For every brain cell in the equity or corporate credit market, the treasury market has a thousand-fold more. With these one-thousand brain cells, this pig (specifically the longer-dated pig) is rewarded by looking further ahead into the future. What does this pig see when they look that far ahead? An recession that will obliterate the equity market like Exodia. The long dated treasuries have started to price in a recession (very slowly) by pricing in rate cuts. This is why stocks and bonds are still correlated, but the correlation has started showing signs of weakness. The longer tail of the curve is smarter and refuses to sell these bonds like a fire sale. Recessions imply a fed pause and eventual rate cut, so no more high-interest treasuries. This makes bonds desirable, and this process is only starting now. I can already feel the credit market enjoyers seething and muttering: SLR relief expired! Reverse Repo! Basil Tea! No, none of these buzzwords matter. It's true that the pandemic has modified the initial conditions of the bond market. The TLT suffered immensely as the federal reserve promised to not raise rates through forward guidance, broke those promises (as is should have), and also allowed SLR Relief exemptions to expire. This made bonds less sexy and glamorous for banks like JP Morgan because the expiry affected treasury exemptions: banks didn't need to hold additional collateral to slurp bond yields, and now they again do. It's much easier now to park money with the fed overnight and get a little more back. The RRP is a much better facility than treasuries as a result, so bond indexes have dropped even harder. SLR relief is a cherry on top, but this truffle has always tasted good without it. It's absence, and whether it is reinstated or not, should not be a determining factor in the recovery of bond prices, because: No market has currently priced in a recession, and interest rate expectations demonstrate that without a chart, but when that happens, the bond market will get top billing. Bonds will decouple from stocks and TLT will rise from the ashes like a phoenix in the next quarters, incinerating twitter and reddit soys drawing lines on a chart and shorting the index. Nobody saw it coming, they will say, but good trades are never crowded. Smart money extracts the deep value from TLT in the pre-recessionary market by going long (DCA or otherwise). Degenerate smart money is gambling with TLT long calls. Whereas most of the market is still buying stocks, crypto, and chanting that the markets are broken and the fed will come roaring in. These pigs won't find any truffles in this market. Interest rate expectations are unrealistic and the fed will have to pause sometime early 2023. The recession will destroy demand, taking growth, inflation, and equity market with it, rising bond prices and dropping bond yields. The stock market will crash (I don't consider this current price action a crash yet) and continue burning even as the fed pauses, and dip buyers will be buying a dip that keeps on dipping while you're selling your new truffles on ebay because you lost your job due to mass layoffs across the entire economy.
NASDAQ:TLTLong
by coinhoIio
10
Short Spain/Ibex 35So... the Spanish market has actually OUTPERFORMED all the other european indiced in the past year and actually YTD: www.investing.com --> "Performance" that makes no sense... a country/economy which were on the edge of bankrupcy in the last financial crisis. Why has this economy outperformed all the other eonomies? it makes no sense . IMO a short position for the rest of the year (if needed) should be in order. As soon as the ECB raises the interest rates, just watch Spain (and Italy for that matter) it will go down and struggle like all the southern european countries has done for ages. Nothing has changed - it will happen.
SShort
by Hvalp
EUR/GBPMaybe a potential short trade for the EUR/GBP? - BoE is bound to come with a 75 Basis point increase on the interest rate Thursday . - England are experiencing way tougher inflation than the European regions. - RSI are already/close to signal a overbought signal, therefore a back-trace to more normal levels would be ideal - ADX also showing a strong upward trend, been doing so for days, but should change direction, if my guts are correct. lets see what happens in the coming week.
Short
by Hvalp
2
Future interest payments will skyrocketThis shows expected interest payments as a moving average divergence around current interest payments which acts as a moving average that is delayed by one to two years. Anyways, the current "future" interest payments as calculated by the US05Y yield have never had a larger divergence from current payments. It is expected that in one to two years, US interest payments on the national debt will be more than 30% of tax receipts (see FRED:A091RC1Q027SBEA/FRED:W006RC1Q027SBEA)
TVC:US05Y
by rrmhearts
DXY D1 - Bullish Break ExpectedDXY D1 With the above being said... 'key global topics' and other comments, we have to understand the market correlation and timeframes... We can take yesterdays D1 close with a pinch of salt, due to inconsistent volume, but lets see where we close after today (hoping support holds). US based FX and commodities look like they want to be correcting somewhat. Which might see DXY dip below support. US stock space is slower paced and a little delayed. So correlation isn't going to be 100% inverted.
TVC:DXYLong
by Trade_Simple_FX
Another Dip in the Market. What's the Silver Lining for Crypto?With inflation's end nowhere near in sight, the Federal Reserve this week announced more "tough times" ahead - indicating that they're likely to do more interest hikes for the rest of 2022. Inflation rates in the US right now sits around %8-10 - but since CPI reports exclude food and energy prices by design, the "real" inflation rate is likely a lot higher. Most people see the prices of food and gas rising in their own lives and are probably feeling more than what the "official" numbers say, at least. A lot have been said about what this means for the economy as a whole, but if you're a crypto investor the things to recognize are: - This is the first time in history that the Federal Reserve has increased interest rates during a recession - normally you lower rates as the economy dips to give it a boost, but the Feds have no room to do that since the rate was already at 0 for most of the last decade. The problem is much more severe than it is typically reported, especially in the wake of the COVID lockdown procedures that we have yet to experience the full effects of, yet. Some are predicting a market correction as high as 50-60% in stocks, 30-40% in real-estate. We don't know if it's going to go that high but there's no reason to think that it's going to improve, at this point. ("Brace for impact", as many have been warning for a while - it's finally coming.) - Increases in interest rates generally means borrowing is more expensive, which is likely going to slow down startup investments in the Web3 space, too. Crypto projects, VC/VC firms, and "thought leaders" in the space as we know now are likely to disappear in the next few years as access to cheap money dries out. - Crypto projects that have been heavily reliant on marketing to keep their prices up will likely tank with the fiat markets, because of its increased overlap with the mainstream economy. Even Bitcoin, Ethereum, Dogecoin, etc. may be in trouble since their notoriety may turn sour when the fiat markets tumbles further. (Being well-known is not an asset in this case, in other words.) - Currently the most popular crypto coins have no means of reacting to inflation rates (except for Ethereum, which will begin its staking services after the "merge" in September, in theory), so they may struggle to justify convincing people to HODL while the banks start to offer higher interest rates for savings accounts overall. Staking coins like Tezos , Algorand (ALGO), Cosmos(ATOM), are in better position to take advantage of these trends since they are, at least for now, outperforming the banks by a very large margin. - When the economy as a whole starts to get unstable the common wisdom is that money will flow into the USD. We don't know if that will happen this time - especially with the USD's credit rating outlooks having deemed "negative" by international agencies since 2013. We know that generally speaking, interest in crypto assets tends to increase in countries where its fiat currencies are less stable - but that often requires a breaking point in which the population loses faith in the banking system as a whole. Are we at that point, yet? - For crypto prices to stay stable, all it needs is about 1% of existing fiat money to maintain its current price. (The general economy is about a 100x bigger than the crypto economy as a whole right now.) But it's allocation, per coin, is not likely to stay even. Crypto will bottom out with the fiat economies, but only a select few coins are likely to make a comeback during the recovery process. Many crypto investors are banking (literally) on the general public losing faith in the fiat system as the market dips further, which will make crypto investments look more appealing. The most obvious "utility" for crypto right now is staking rewards - which are objectively outperforming the banks right now, but the bear market will also be a period for altcoins working on providing real value to its users to come out ahead. It's going to be a wild ride either way - good luck, folks. 🤞
Editors' picks
BITTREX:DOGEUSDLong
by RyanTanaka
16
XRP BREAKOUT TO THE BEARS!The price has officially broken out the consolidation range to the bears. The target point for a reversal is still at at $0.28 however there is a few levels of support before the price reaches this point, these support levels were sourced from the fib retracement of the current wedge formation. The price has bounced off the golden ratio, (62.8% fib) so the price should sit around this area for a bit before breaking lower, ($0.334-$0.330). The RSI is also pushing oversold on the 4 hour chart. This is a good indicator as a recovery is in sights. It can be argued that the reason for the price dump along the whole crypto space is based on the current talks about a interest rate hike by the FED which on top of the previous hike, results in a sell off of traditional stocks and assets as we have seen today. Feel free to comment your opinion on the matter.
BITFINEX:XRPUSDShort
by Crisp_Flow
Uniswap Volume Hit BELOW $24 Billion TODAY Uniswap saw a further decrease in exchanging volume during the seventh month of the year because of diminished financial backer interest in computerized resources. Uniswap arrived at a new low in July as the month ended up being one of the more terrible periods in the exchanging history of the decentralized trade (DEX). The DEX kept about $37.8 billion in volume during the primary month of the second from the last quarter of 2022, as per Be Crypto Research. While this worth might appear to be high because of the volume recorded by contending DEXs, for example, 1inch, SushiSwap, Curve, Balancer, dYdX, Loopring, Shibaswap, and Mooniswap, it was an 18% reduction from June. Uniswap volume for June was around $46.4 billion. After arriving at a new low since it kept a volume of $32 billion in February 2021, Uniswap likewise saw a 4% drop year-over-year in exchanging volume from July of a year ago. In July 2021, Uniswap had an exchange volume in the locale of $39.8 billion. Generally speaking, July's measurement was a $24.8 billion tumble from the yearly high of $62.7 billion in May. What caused the dunk in Uniswap volume? An in general negative market that developed in May which acquired additionally ground in June, and reached out to July has been credited as the reason for the drop in the exchanging volume of Uniswap, decentralized trades, and unified trades (CEXs) all in all. UNI cost response UNI opened on July 1, with an exchange cost of $4.99, arrived at a month-to-month high of $9.74, tried a month-to-month low of $4.73, and shut the month at $8.37. Generally, despite a decrease in exchanging volume, the moderately lower costs of tokens saw a 67% expansion between the opening and shutting cost of UNI in July.
BITTREX:UNIUSDLong
by IPatrice
IF the 30 year bond stays above the trend line, stocks lose.The three decade + trend for bond rates has been downward. In June, we witnessed the first rise above that trend line in recent history, followed by a return to the trendline last week. This is a pivotal point for both bonds and stocks. If stocks drop back down below the trendline, we can see the market go higher in the near term. If the 30 year bond rates rise this, we can expect a downturn in the stock market. Prediction: Bonds will trade sideways before going up. Stocks, already with substantial momentum, will continue higher, until bonds resume an upward momentum, confirming that the stock bullmarket is over. This may last up until the Fed raises rates in September.
TVC:US30Y
by ericklee64
US Recession? We will Sink at least 50% For a Recession.Between the 2008 great financial housing crisis, the end of the dotcom bubble in the year 2000, the 1970s stagflation recession, and the great depression of 1929 all have one thing in common. The market retraced at least 50% from it's peak. I personally believe the US economy is in conditions for a recession that will at least sink 50% or more if we were to compare to past indicators and technical conditions of a recession. Just my opinion take it with a grain of salt. At the end of the day past is no indicator of the future. However history doesn't repeat itself it often rhymes. There's been a lot of rhymes I'm seeing. Much peace, love, health, and wealth!
SP:SPX
by peacefuljustin
5
ETHUSD OUTLOOK, 2022-2023, is Ethereum following the leader?Greetings community I have illustrated my outlook on ETH/USD, which to me seems to be corrective, and headed to complete it's cycle to the downside, in addition fundamental's seem to be hand in hand with these technical's as of current. The chart clearly indicates direction and predictable behavior of the asset, with price trading just under $1700, it is merely a matter of whether we'd decline immediately or touch $2000 prior to the anticipated plummet to bottoming out. Ethereum now trades 77% below its $4,951-record high, but some tokens are down 90% from their 2021 peak levels. Concerns about the Federal Reserve’s hawkish policy to tame inflation has stoked these sell-offs, hurting parts of traditional stock markets in tandem. In detail, the U.S. central bank plans to hike benchmark rates in 2023, which may leave investors with lesser liquidity to buy riskier assets like BTC and ETH. Additionally, forced selling and liquidity troubles led by the so-called decentralized finance, or DeFi, sector have added downside pressure on the crypto market, thus limiting Ether’s prospects of continuing its recovery rally moving forward. Notes: -ETH 2.0 delays, anticipated for 2023 -Stocks & Crypto's are somewhat in-sync to current financial conditions -Recession rumors -Interest & inflation I would personally enter long positions closer to Q4 2022 leading into Q1 2023 across all assets, while many will be suffering from FOMO, we need to accept that this certainly does seem like the calm before the storm, given the economic state of the US. For me, as a swing trader, it's always beneficial to purchase anything, whether margin trading or simply holding, at the best possible price, especially when you're in it for the long haul and have immense fundamentals tipping the scale. Fingers crossed for Ethereum to fall beneath $1000, and potentially halve from there. I would anticipate for ETH and BTC to bottom out simultaneously, as title states, is Ethereum following the leader?
BITSTAMP:ETHUSDShort
by unacknowledged
🔥 Bitcoin & FOMC Interest Rate Decision: What To Watch ForLike most of you know, in a couple of hours the US Federal Reserve will share with the world how much they will increase the interest rates. Remember that lower interest rates = bullish for the markets. At the moment, there's a 75% expectation that the hike will be 0.75% and a 25% expectation that the hike will be 1%. Naturally, if the FED will increase with 1% we can expect a massive down move. The extremely bearish reaction target for a 1% hike would be $18k. However, if the FED will only increase by 0.75% we can expect a slightly bullish move. This might be the starting signal for a move all the way back to the top of the channel, think $24k or so. Obviously, the percentage of the hike will be important. However, what most market participants are watching will be the FED meeting where J. Powell will talk about the outlook of the markets and the interest rate hikes for the coming months. This is where the real direction of the markets will be decided. My advice would be to wait for what the market will do. Ideally wait until tomorrow, because tonight's initial direction can be a fake out, like a couple of meetings ago.
by FieryTrading
17