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$NQ1! - Busy week ahead! CME_MINI:NQ1! - Busy week ahead! We've got a busy calendar ahead of us and remember it's first day of the month - May a Lot of US Data! 1. ISM 2. JOLTS 3. ADP 4. FOMC 5. NFP Now that's a busy week and I know for some, they will be stepping back and not trading during a hectic week ahead, but I do feel there will be plenty of opportunities. Now, banking sector is at the key spot light ahead of this week mentions of First Republic Bank will be acquired by JPMorgan after rescue efforts fail. It's not first time this year, we've heard a bank go under, and unfortunately that's part of the cycle as rates head higher, a lot of sectors get hurt, look at real estate and this is what I mentioned months prior - I well recommend researching more in depth. Keep in mind FED want a 2% target for inflation...Expectation is for the FOMC to lift rates by 25bps at its May meeting, now the real question is will they pause after this hike or carry on, whilst we got credit tightening... Now technically looking at NQ Highs: 13391 Lows: 12787 At the moment we've got Kangaroo action until a break to either side - If we are to break the highs, I expect next area of interest to be 13660 areas. However, we are to break the lows, I expect 12481 areas. NQ has held relatively well within the conditions we are in, interesting times ahead. Have a great week ahead, Trade Journal
CME_MINI:NQ1!
by Trade_Journal
SPY S&P 500 ETF Prediction Ahead of FED Rate Hike Decision ! This week's Federal Reserve meeting is highly anticipated, and I`m predicting that the market will go down following the announcement. The primary reason for this prediction is the expectation that the Fed will keep interest rates high for longer, with no rate cuts predicted for this year. Based on fixed income futures, there is a 70% chance that the Fed will hike rates by 0.25-percentage-points, while only a 30% chance that they will hold rates steady. My prediction is that the Fed will indeed raise interest rates, which could lead to a market downturn as higher interest rates tend to slow down economic growth. If the Fed's decision leads to higher interest rates that remain in place for an extended period, it could result in lower spending and investment by consumers and businesses, which could further exacerbate the market downturn. Therefore, many investors are closely monitoring any signals regarding future rate hikes or cuts and preparing for a potential dip in the market following the announcement. According to the technical analysis chart, the SPY appears to be forming a bearish head and shoulders pattern, indicating a potential trend reversal from bullish to bearish. This pattern typically consists of three peaks, with the first and third peaks being of similar size and the middle peak being the highest. Based on this pattern, my estimated price target for the SPY is 390. Based on my analysis, I would buy the following PUTS ahead of Fed's decision: 2023-7-21 expiration date 390usd strike price $5.05 premium I am interested to hear your thoughts on this strategy.
AMEX:SPYShort
by TopgOptions
12
OPEC Output Cut Reignites Inflation SurgesNYMEX: WTI ( NYMEX:CL1! ), RBOB Gasoline ( NYMEX:RB1! ) Over the weekend, eight OPEC producers, led by Saudi Arabia, announced intentions to cut oil production by 1.16 million barrels per day through the end of the year. This adds to Russia’s existing plan to trim 500,000 barrels from February level, bringing the combined voluntary cuts of OPEC+ members in excess of 1.6 million barrels per day. This surprise announcement is a supply shock and pushes oil price to its highest level in a month. On Monday. NYMEX WTI May futures contract opened at $80.1, up 6.1%, while refined products Heating Oil (HO) and Gasoline (RB) went up 2% and 3%, respectively. Oil price hike adds to the risk of global economic slowdown. COMEX Gold is up 1% to $2,002. For a thorough analysis on gold, please read my recent writing: Oil Price Elasticities and Oil Price Fluctuations Crude oil is an inelastic commodity. When oil price goes up, the resulting decrease in demand will be less, in percentage terms. In a 2016 research paper, Fed economists found that the short-run oil supply elasticity is about 0.1 and the oil demand elasticity is about −0.1. They also found that oil supply shocks are the main driving force of oil market movements, accounting for 50 and 40 percent of the volatility of oil prices and oil production, respectively. (Source: “Oil Price Elasticities and Oil Price Fluctuations”, Caldara, Dario, Michele Cavallo, and Matteo Iacoviello (2016), International Finance Discussion Papers 1173.) Let’s illustrate this point mathematically: • Given: Revenue = Sales X Price, assuming sales = demand • When price goes up 6%, sales would change by -0.1 X 6% = -0.6% • New Revenue = (1+0.06) Price X (1-0.006) Sales = 1.05364 (Price X Sales) • The percentage of change in oil revenue is +5.4%. The economic reason behind the OPEC decision: 1) Supply shock pushes oil price up; 2) Higher price and lower production result in higher oil revenue. This explains why the US has difficulty persuading OPEC to increase production. It runs counter to their core economic interest. Investment Strategies in an Inflationary Environment US consumer price index (CPI) rebounded 0.4% and 0.5% in the first two months of 2023. Annual inflation for energy products: Gasoline (-2.0%), Fuel Oil (+9.2%), Electricity (+12.9%) and Piped gas service (+14.3%). Oil price surge raises energy cost globally, from transportation and utility to the cost of most goods and services. This adds to the uncertainly of central bank monetary policy. According to CME FedWatch, futures traders put 44.6% odds of no rate hike in the May FOMC meeting, and a 55.4% chance of raising 25 basis points. This is like flipping a coin. However, there are opportunities on energy futures, if current price trend continues. WTI Crude Oil (CL) Since last year, the Biden Administration released 180 million barrels of crude oil from the Strategic Petroleum Reserve (SPR) to fight record gasoline price and runaway inflation. According to US Energy Information Administration (EIA), crude oil stock in the SPR stood at 371.6 million barrels at the end of January. This is the lowest level since 1984. In a few weeks, the peak summer driving season will be here. This, coupled with the need to replenish the SPR, forms a strong demand basis for the remainder of the year. With demand being inelastic and the OPEC having incentive to cut output further, I could see WTI going back to the $90-100 range. July WTI (CLN3) is currently quoted $80.0 a barrel. Each contract has a notional value of 1,000 barrels. Margin requirement is $5,500 to place one contract. Hypothetically, if July futures goes up to $90, a long position in one July WTI contract would gain $10,000 (=10*1000). Theoretical return would be +81.8% (=10,000/5,500-1), excluding commission. RBOB Gasoline (RB) On April 3rd, American Automobile Association (AAA) reports that national average retail price for regular unleaded gasoline is $3.506 per gallon. This is up 6.7 cents or +1.9% from a week ago, and +11.6 cents or +3.4% from a month ago. Current price is 68.6 cents or 16.4% below year-ago price of $4.192. However, with less supply and more demand on the horizon, I expect gasoline to retest the $4 level soon. July RBOB (RBN3) is quoted $2.6575 a gallon. Each contract has a notional of 42,000 gallons. Minimum margin is $6,500. If futures price goes up to $2.9, a long position would gain $10,185 (=0.2425*42,000). Theoretical return would be +56.7% (=10,185/6,500-1). Heating Oil (HO) Heating oil price peaked during cold winter season in January. While it is a refined product, the cost of crude oil has less impact on heating oil in off-peak season. Therefore, I do not see much upside potential from current price level of $2.6665/gallon. Henry Hub Natural Gas (HH) OPEC’s output cut has no direct impact on natural gas supply. Today, HH futures went down 11.7 cents to $2.099 per 10,000 MMBtu, or -5.23%. In the U.S., about 50% of the electricity is generated from natural gas, with the remainder coming from coal and renewable energy sources. CBOT Corn Futures (ZC) Currently, up to 40% of US corn output is used to produce ethanol, a form of biofuel. Oil price surge would boost the consumption of the lower-cost ethanol, holding everything else equal. I will write a separate paper on Corn futures next month. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trading set-ups and express my market views. 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
NYMEX:CL1!Long
by JimHuangChicago
1
The Ten Fundamental Objectives of the Federal ReserveIntroduction The Federal Reserve System, often referred to as "the Fed," was established in 1913 in response to a series of banking panics. As the central banking institution of the United States, it plays a crucial role in maintaining the stability and integrity of the nation's monetary and financial systems. This essay explores the ten fundamental objectives of the Federal Reserve, which include maintaining price stability, promoting full employment, and ensuring a stable financial system, among others. 1. Price Stability The primary objective of the Federal Reserve is to maintain price stability, which refers to a low and stable rate of inflation. By managing inflation, the Fed helps to preserve the purchasing power of money, ensuring that consumers and businesses can make informed decisions regarding spending, saving, and investment. 2. Maximum Sustainable Employment Another key objective of the Federal Reserve is to promote maximum sustainable employment, also known as full employment. This means providing enough job opportunities for all individuals who are willing and able to work, while minimizing the rate of unemployment. By promoting full employment, the Fed contributes to overall economic growth and well-being. 3. Moderate Long-Term Interest Rates The Federal Reserve aims to maintain moderate long-term interest rates, which are essential for economic growth and stability. By controlling short-term interest rates, the Fed can indirectly influence long-term rates, thereby encouraging borrowing, investment, and consumption. 4. Financial System Stability One of the most critical objectives of the Federal Reserve is ensuring the stability of the financial system, which involves monitoring and regulating financial institutions, as well as identifying and addressing potential risks. By maintaining a stable financial system, the Fed helps to prevent crises and protect the economy from shocks. 5. Efficient Payment and Settlement System The Federal Reserve is responsible for managing the nation's payment and settlement systems, which include check clearing, electronic funds transfers, and automated clearinghouse operations. By providing these services efficiently and securely, the Fed ensures that financial transactions occur smoothly, promoting confidence in the banking system. 6. Consumer Protection Another important objective of the Federal Reserve is to protect consumers by enforcing federal consumer protection laws and regulations. This includes monitoring financial institutions for compliance, addressing consumer complaints, and providing education and resources to help consumers make informed financial decisions. 7. Supervision and Regulation The Federal Reserve plays a vital role in supervising and regulating financial institutions to ensure their safety, soundness, and compliance with laws and regulations. This oversight helps to maintain a stable and resilient financial system, while also protecting consumers and investors. 8. Community Development The Federal Reserve is committed to promoting community development by supporting initiatives that address issues such as affordable housing, small business development, and workforce development. This objective aims to foster economic growth and improve the quality of life in communities across the country. 9. Economic Research and Analysis The Federal Reserve conducts extensive research and analysis to better understand the U.S. economy, as well as the global economy. This research informs the Fed's monetary policy decisions and helps it to fulfill its other objectives, such as promoting maximum employment and maintaining stable prices. 10. International Financial Cooperation Finally, the Federal Reserve cooperates with other central banks and international financial institutions to promote global economic stability and financial system resilience. This collaboration allows the Fed to share information, resources, and expertise, ultimately benefiting the U.S. economy. Conclusion The Federal Reserve plays a pivotal role in the U.S. economy by pursuing ten fundamental objectives, which range from maintaining price stability to promoting international financial cooperation. By fulfilling these objectives, the Fed ensures the stability and growth of the U.S. economy, while also fostering a resilient and efficient global financial system. Trade with care. If you like our content, please feel free to support our page with a like, comment & subscribe for future educational ideas and trading setups.
Editors' picks
FRED:FEDFUNDSEducation
by financialflagship
11
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- Please support the channel by Follow,Boost,Comment and Sharing
BINANCE:BTCUSD.PShort
by pcmonk
Gold Shines amid Global Financial DistressCOMEX: Micro Gold Futures ( COMEX_MINI:MGC1! ) Gold prices surged Friday as a wave of banking crises shook global financial markets. Spot gold climbed 3.1% to $1,977.89 per ounce, its highest level since April 2022. Gold price is now within $100 of its all-time high of $2,074.88. In the futures market, the nearby April contract of COMEX gold futures settled at $1,973.5, where the far-month June 2024 contract closed at $2,076.9. The year-long Fed rate hikes cracked the US banking system. Within two weeks, we have witnessed the collapses of Silvergate Bank and Silicon Valley Bank in California and Signature Bank in New York. First Republic Bank, a mid-sized bank in California, received $30 billion emergency injection from 11 largest American banks, led by JP Morgan. Interestingly, it was J.P. Morgan who organized a $30 million rescue plan to avert the collapse of Wall Street in 1907. That crisis led to the creation of Federal Reserve System. A century later, the cost of bank bailout increases by 1,000 folds. However, bank runs have already spread. Credit Suisse, a prestigious investment bank, is under distress. On Sunday evening, fellow Swiss bank UBS announced that it is acquiring Credit Suisse. Gold Price Rises in Times of Major Crises In the past two decades, gold price peaked in times of market turbulence. • The 2008 financial crisis • The 2010 European debt crisis • The 2018-19 US-China trade conflict • The outbreak of COVID pandemic • The Russia-Ukraine conflict • The March 2023 bank run Gold price is also negatively correlated with the US dollar. Last year, when Dollar rose on the back of Fed tightening, gold took a beating. Now, as investors expect the Fed to slow rate hikes, gold shines through the chaos. Investing in Gold: what in there for you? • Diversification: Gold helps reduce the overall risk of your portfolio by providing a hedge against inflation and currency devaluation • Tax efficiency: Long-term capital gains on gold investments are taxed at a maximum rate of 28%, which is lower than 37% for other long-term capital gains • Protection against rising prices: Gold has historically been a good hedge against inflation, and it can help protect your purchasing power • Liquidity: Gold ETFs and Gold Futures are highly liquid financial instruments. Many brokers also buy and sell gold bars and gold coins, with a commission. • Hedge against difficult economic conditions: Gold is a global store of value, and it can provide financial cover during geopolitical and economic uncertainty • Portfolio diversifier: Gold can act as a hedge against inflation and deflation alike, as well as a good portfolio diversifier In a previous writing, I showed that gold did not work well as a hedge against inflation. However, gold holds up extremely well during major crises where other assets lost value. Hedging against Known and Unknown Risks Risk on, gold goes up. Risk off, gold declines. Some risks are expected, while others come as a surprise. Fed rate actions are scheduled events and can be considered known or expected risk. CME FedWatch Tool shows the likelihood that the Fed will change the Federal target rate at upcoming FOMC meetings. It analyzes the probabilities of changes to the Fed rate and U.S. monetary policy, as implied by 30-Day Fed Funds futures pricing data. As of March 19th, FedWatch estimates a 38% chance of Fed keeping the current rate unchanged at 450-475 bp, and 62% odds of increasing 25 bp to 475-500 bp. By providing $300 billion in emergency lending to member banks, the Fed has effectively put Quantitative Easing at work. In my opinion, the Fed has switched its priority from fighting inflation to crisis management. Managing the systemic risk in the US banking system outweighs the battle against inflation at this time. It’s a matter of priority. What’s unknown is the potential failure of any bank not yet exposed in the news. US banks are estimated to sit on unrealized loss in hundreds of billions of dollars in their bond portfolio, largely consisted of Treasury and US agency bonds. As the “held-to-maturity” asset will be sold or marked down, these banks could run into trouble by a run of depositors and investors. In this unusual time, no news is good news. Short-term Trading Strategies The upcoming FOMC meeting on March 22nd make a compelling reason for event-driven trades on Micro Gold Futures. Here is my logic: • If the Fed keeps the rate unchanged, stock market would rally. As a major risk is removed from the financial system, gold price would fall • If the Fed raises 25 bps, stock market would fall, and gold price would rally, potentially breaking the current record high Micro Gold Futures (MGC) contract has a notional value of 10 troy ounces. At $1,993.4, an April 2023 contract (MGCJ3) is valued at $19,934. Initiating a long or short position requires a margin of $800. This is approximately 4% of contract notional value. If gold price moves up to $2,050, a long futures position would gain $566. Relative to the initial margin, this would equate to a return of +70.8%, excluding commissions. If gold price moves down to $1,900, a short futures position would gain $934, a theoretical return of +116.8%. Unexpected market event could be a trigger for gold price to rally. An event-driven trade idea could be constructed around it. In my opinion, comparing to the distress of regional banks, the systematic risks triggered by a Big Bank failure could send global market in shock at ten times the magnitude. If the Fed raises rate next week, I expect more bank failures to coming in the next few months. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trading set-ups and express my market views. 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
COMEX_MINI:MGC1!Long
by JimHuangChicago
1
CABLE WEAKNESS INCOMING From a Technical standpoint we can see solid resistance forming in this current supply zone, which supports a RETEST of the SHOULDER that has formed around 1.19 Area. There will be a significant fight here however, as the downwards momentum of STERLING is very strong. Fundamentally the outlook for GBP remains very challenging as opposed to the US Dollar. Whereas Powell is going to realistically need at least one or two more hikes, the BoE is in a rather precarious position. With inflation peaking the Bank of England doesnt have much more room to keep pumping rates up, while other economic factors arent coming as strong in England as they are in the USA, with USA JOBS and consumer index keeping the dollar strong. Look for CABLE to retest lows at 1.19 and potentially dip further if price action allows it
Short
by NakedTrading4U
2
A Leading Indicator for US EconomyCME: E-Mini S&P Retail Select Industry Futures ( CME:SXR1! ) Last Friday, the U.S. Bureau of Economic Analysis (BEA) released the latest Personal Income and Outlays Report. Personal income gained $131.1 billion (0.6%). Disposable personal income (DPI) added $387.4 billion (2.0%) and personal consumption expenditures (PCE) grew $312.5 billion (1.8%) for the month of January. Data shows that U.S consumer is resilient. Wage gains and inflation pushed spending growth to a two-year high. In the past decade, PCE gained 60% to $18 trillion. More recently, it surged 50% in the three years since the start of the COVID pandemic. The hotter-than-expected data indicated that US economy was nowhere near a recession. Additional data from the Bureau of Labor Statistics showed robust job growth in January and the lowest unemployment rate in half a century. Wary of bigger and longer-lasting Fed rate hikes on the way, all major US stock indexes turned negative in the month of February. As of last Friday, Dow Jones Industrial Average was down 3.8% month-to-date, while S&P 500, Nasdaq 100 and Russell 2000 recorded -2.6%, -0.8%, and -2.4%, respectively. Consumer Spending Outlook Consumer spending accounts for over two-thirds of U.S. economic activity. While PCE shot up more than expected last month, it is a lagging indicator and only confirms what happened in the past. Could U.S. consumers spend out of the peril of a recession? Retailer stock prices are forward-looking and reflect collective market consensus of how much free cash flow the retailers could earn, discounted by their cost of capital. There are indications that the shopping spree may be ending soon. Last week, Walmart said its U.S. consumer spending started the year strong, but that it expects households to back off through the year, producing weak fiscal-year U.S. sales growth of 2% to 2.5%. Home Depot said consumer spending is holding up, but that it expects a flat sales-growth year overall, with declining profits. This is a troubling signal. Retailers are supposed to benefit the most from growing consumer spending, but their stock prices have been losing steam in February. As of Friday, Home Depot ( NYSE:HD ) has a year-to-date return of -6.1%, while Walmart ( NYSE:WMT ) is mostly flat (-0.8%). Other retailers with declining stock prices include Dollar General ( NYSE:DG ), -13.2%; Walgreens Boots Alliance ( NASDAQ:WBA ), -3.7%, and Casey’s General Stores ( NASDAQ:CASY ), -3.8%. Walmart reported Q4 and FY2023 (ending January) revenue growth of 7.3% and 6.7%, respectively. Its operating income fell 5.5% and 21.9%, for the same periods. Digging deeper into Walmart’s earnings release, I find that it keeps sales growing by expanding its grocery business, but those sales are less profitable than general merchandise categories, where consumer spending is leveling off or shrinking. In theory, the growth of the biggest US retailer could be attributed to one of the following: • General growth of consumer spending (economic expansion); • Good business strategy and market share growth (economic trend unknown); • Consumer downgrades spending from department stores (economic downturn); • Price increases (inflation). My interpretation: 1. Consumers tend to keep up with the same living standards. When inflation hits, they maintain the same purchasing habit. Higher price drives spending growth. 2. As inflation deepens, consumers get fewer merchandises with the same budget. 3. Consumers downgrade purchases from department stores to discount stores, and switch to generic products from brand-named products. 4. In a downturn, higher-ended stores get hit first, and discount stores get hit last. While Walmart manages to grow revenue by doubling down on grocery and online businesses, the weakness in general merchandizes uncovers the real trend of consumer spending leveling off. We may disagree on whether a recession will be coming, however, data from Walmart and Home Depot indicates that the U.S. retail sector is in trouble. S&P Retail Select Industry Index S&P Retail Select Industry Index may be a better benchmark for the U.S. retail sector, comparing to the lagging government data and company specified performance metrics. The index comprises of stocks in the S&P Total Market Index that are classified in the GICS retail sub-industry. Total-10 constituents by index weight are: • Carvana (CVNA) • Wayfair (W) • Sally Beauty (SBH) • Stitch Fix (SFIX) • Boot Barn (BARN) • Children’s Place (PLCE) • Qurate Retail (QRTEA) • Leslie (LESL) • EVgo (EV) • Abercrombie & Fitch (ANF) One-year chart above shows that CME E-Mini S&P Retail Select Industry (SXR) Futures tracks the trend of S&P 500 but illustrates higher volatility in the first two months of 2023. Each SXR contract is notional at $10 times the index. At Friday settlement price of 7004, one March contract (SXRH3) is valued at $70,040. Each futures contract (long and short) requires an initial margin of $5,700. When the underlying index moves 1 point, trader’s futures account would gain or lose $10. At present, I do not foresee a decisive trend of the S&P 500. It could trend up, go down or move sideways depending on how the Fed rate hikes, inflation, unemployment and geopolitical crises play out. However, this does not prevent me from expressing a bearish view on the US retail sector. Establishing a SXR short futures position would be appropriate in the negative outlook. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
SShort
by JimHuangChicago
Negative Real RateReal rate is different from interest rate. Real rate is the difference between interest rate with the inflation. We have been running on negative real rate for a decade plus. This is an accommodative measure by the Fed to make sure the market is still running hot. S&P500 has been running well during this period of time where the interest rate is kept below the inflation. However there are several occasion where the negative real rate is running deep in 1970s and 2020s, which prompt the Fed to raise the rate. However so far we have not seen real rate hikes goes into positive territory yet. When the real rate is in positive territory S&P500 index will also running well as the economy is running well without Fed's life line support. However I'd expect that the market will be flat and volatile during transition between negative to positive real rate, because the market trying to figure out whether the economy would be running well or not when the life support is removed slowly.
SP:SPX
by danny_peanuts
1
You Can Have the Cake and Eat it TooCBOT: Treasury Yield Spread 10Y-2YY ( CBOT_MINI:10Y1! CBOT_MINI:2YY1! ), Micro Dow ( CBOT_MINI:MYM1! ), Micro S&P ( CME_MINI:MES1! ) On Wednesday, the Federal Reserve raises its benchmark Fed Funds rate by 25 basis points to a target range of 4.5%-4.75%. The move marked the eighth consecutive hikes that have began in March 2022. The overnight risk-free rate is now at its highest level since October 2007. Fed Chairman Jerome Powell sends mixed signals in his post-FOMC meeting news conference but appears more dovish comparing to previous speeches. The Committee thinks that “on-going increases in the target range will be appropriate”. These words send stocks down minutes after the speech begins at 2:30PM. However, during the Q&A session, when the Fed Chair confirms, for the first time, that “the disinflationary process has started,” the stock market rebounds strongly and finishes in the positive territory for the day. Other mixed messages: • Inflation data shows a welcome reduction in the monthly pace of increases; • It would be “very premature to declare victory or to think we really got this”; • It’s “possible” that the funds rate could stay lower than 5%; • Unlikely the Fed would cut rates this year unless inflation comes down more rapidly. Actions speak louder than words. In two rate-setting meetings, the Fed has slowed the pace from 75 bps to 25 bps. The path is not likely to reverse, and future rate hikes will come down to just two options, either 0 or 25 bps. In my opinion, the terminal rate will end at 5% or 5.25% after the March and May meeting. In recent months, the “Risk” button has been pressed on for risky assets: • The Dow is up 19% since October, and the S&P and the Nasdaq are up 17% and 18% for the same period, respectively; • Gold futures rallies 21% since November, while Bitcoin jumps 58%; • Tesla and Ark Innovation ETF gain 47% and 33% year-to-date, respectively. Historically, it’s rare for the stock market to dip two years or more in a row. For the S&P 500, it only happened four times in the last 100 years. The odds favor stock investors in the Year of Rabbits after a brutal double-digit selloff in 2022. Fed rate hikes and high inflation are like a brake that decelerated the running economy car. Now that the driver’s foot is off the brake, will the economy improve immediately? Not so fast. We will endure higher costs for months to come. Take the example of food items, once the price goes up, it usually stays up for the year. Sometimes, suppliers resolve to reducing the size of package for the illusion of keeping the same price, a tactic known as “Shrinkflation”. Wages, rent, phone bill, cable TV, utility, homeowner association fees and sales tax also seldom go down. All these point to a sticky inflation. Without massive government stimulus to press the gas pedal, subdued growth is on the horizon. However, the stock market is forward looking. Investors already see an "invisible foot" on the accelerator and begin buying in the dip. On balance, I’m bullish about risky assets, but would consider protecting my investments carefully. The inversed yield curve is a proven and tested signal of a potential recession. The 10Y-2Y Treasury yield spread is at -64 bps after the Fed rate decision. The yield spread turned negative last July and stayed below zero in the last seven months. Major crises could break out unexpectedly, crashing our party. The year-long Russia-Ukraine conflict could intensify, tensions in the Taiwan Strait could escalate, and the US government might not be able to avoid a national debt default. A Hedged Position on Stock Index Futures We could consider using the CME Micro E-mini S&P futures to establish a bullish position on the U.S. stock market. The June contract MESM3 is currently quoted at 4177, which is 58 points above the cash index. To protect my position from any adverse market movement, an out-of-the-money put option could be placed at the 3950-strike. If you are more pessimistic, a lower strike of 3840 may be considered. The benefit of futures over cash index ETFs lies with the leverage. With a smaller margin deposit upfront, investment return could be amplified if the market moves in your favor. The downside is that the loss will also ramp up quickly if the market moves against you. Put options protect us from any downfall below the strike price. Unlike futures, the maximum loss from a long options position is the premium you have paid upfront. A combination of long futures and long put options is, in theory, limited downside with unlimited upside. The risk and return tradeoff are asymmetry in this case. As a result, you can have the cake and eat it too! Happy trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
Editors' picks
CBOT_MINI:10Y1!Long
by JimHuangChicago
9
Market ignores macro trends before Fed meeting The market has been rising a lot lately, with many turning bullish. We have a critical event coming that will dictate the direction of the market sentiment. Market broadly believes Fed will reduce rate hike from .50 to .25. I have concerns with this conclusion Unemployment has been decreasing regularly. Inflation is reducing but still high. We see a continuing trend of layoffs primarily occurring in tech while other sectors are still highering. Fed has warned that the recent rally will only lead to greater pain down the road. The fed is aware of the greedy sentiment and has a history of tampering down greed while fighting inflation. My belief is that the markets sentiment of reduction to .25 is more based on wanting to see a light at the end of the tunnel, less on macro trends. My view is that fed will hold at .5 rate increase reiterating long road ahead. This will bring a shock to the greedy markets and trigger a wave of selling. Greed is definitely the sentiment right now. Buy the fear, sell the greed.
AMEX:SPYShort
by ratchet-mint
1
It's happening! Blow-off top, Day 1.Traders, You all know that I have been expecting and discussing this day for many moons now, the day we break above our macro downtrend. Today is that day. Day 1 of what I expect to be a blowoff top that will surprise many investors, maybe a majority of investors. Before I get ahead of myself in enthusiasm, we will need another confirmation candle here on the daily. I'd love to see us close and open above the macro uptrend line as well, but that type of price movement is not necessary for confirmation. All we need to do is open and close tomorrow's candle above our macro downtrend and we are good to go. New highs in the U.S. stock markets should arrive sometime this year. I would anticipate by mid-summer to late fall. Enjoy the ride! Stew. [
ULong
by stewdamus
JICPT|DXY is on the verge of rebound on the weeklyHello everyone. Dollar index has retreated from the high around 114 created in late September when investors expected inflation would be cooling soon. To make it clear, I also inserted U.S core CPI year-over-year data on the weekly chart. You can refer to the purple line. Obviously, The dollar index moved in line with the CPI data. Both topped around the same time. When we looked at the DXY rising angle, we can see it accelerated to the upside since March 16, 2022, when Fed raised interest rate for the first time since the pandemic by 25bps. The main driving force behind the move is inflation. So what's next after the Dollar index took a dive of 50%. From my point of view, the index may held above 100 for a while(relative strong) until inflation is confirmed to go back to the 2% target. That may happen in the H2 2023. The reasons are below: 1. After the dramatic move, sellers need to take a rest around key zones(fib 50-61.8%) 2. Dollar index has been over sold. 3. 100 combined with a strong demand zone is likely to prevent it from further drop. If I'm right, there will be short opportunities for gold, and other currencies, e.g., EUR. What do you think? Give me a like if you're with me.
INDEX:DXYLong
by JICPT
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
Year of the Rabbit - Short-tailed TradingCME: E-Mini Select Sector Futures ( CME_MINI:XAZ1! , CME:SOX1! , CME_MINI:BIO1! , CME_MINI:XAV1! , CME_MINI:XAB1! , CME_MINI:XAK1! , CME_MINI:XAI1! ) According to Chinese Zodiac, tigers are vigorous, daring, competitive and unpredictable. 2022, the Year of Tiger, was symbolized by these bursts of power: • First war in Europe after World War II (Russia-Ukraine) • Highest inflation rates in US and Europe in four decades • Seven consecutive interest rate hikes by the US Federal Reserve • Crypto market crash wiped out $2 trillion and FTX, its 2nd largest Exchange • Artic storms swept North America like the Sci-Fi movie The Day After Tomorrow • China ended Zero-Covid and brought 1.4 billion people back to normal lives Enter the Year of the Rabbit on January 22nd, the lunar Chinese New Year, it will be a long year with 384 days. Why? Every few years, a leap month is added in to bring the 360-day lunar year to align with the 365-day solar calendar. Chinese astrology characterized rabbits as gentle, quiet, elegant, alert, quick, and skillful. While it might appear absurd to relate trading to a Zodiac sign, I would like to give my main investing theme a memorable name, Short-tailed Trading. As we switch gears in the new year, I want to first review what happened in the past year, before discussing forward-looking new ideas. Today we focus on equities and equity indexes and discuss interest rates, foreign exchanges, energy, metals, agricultural commodities, and cryptocurrencies in the follow-ups. US Equity Indexes in Negative Territory All Year Long What happened in a year: In Q1, geopolitical crisis drove stocks down from record-high. In Q2 and Q3, Fed rate hikes pushed stocks deep in the red. In Q4, Fed Pivot helped pare some losses. Major US indexes post their worst year since 2008. The Dow Jones Industrial Average closed at 33,147.25 on December 30th, down 8.8% for the year. The S&P 500 shed 19.4% to end at 3,839.50. At 10,466.88, the Nasdaq Composite lost a third of its value in 2022. The small-cap Russell 2000 closed at 1,765.25, down 21.7%. In the new year, uncertainties will remain the key price drivers of global stock markets: central bank policy, inflation, economic growth, geopolitical crisis, and China reopening. Depending on the specific outcome, the impact of a given factor could range from very positive to very negative, and anything in between. • The Fed: dovish (tailwind) or hawkish (headwind) • Inflation: stable to low (tailwind) or high (headwind) • Growth: soft landing (tailwind) or hard landing (headwind) • Geopolitical crisis: peace deal (tailwind) or escalating conflict (headwind) • China: growth engine (tailwind) or Covid 2.0 (headwind) Fundamentally, stock value continues to be pressurized by elevated interest rates and the high costs of rent, labor, and fuels. However, market price could diverge from economic value if some of the above factors reshape investor expectations. Short Range Trading Horizon Last year, many of my trading strategies stayed on the book for several months. • Short RBOB Gasoline Futures (July-September) • Strangle Options on CBOT Wheat (June-August) • Short Russell 2000 Futures (August-October) This year, I prefer shorter-range strategies that open and close in days instead of months. It’s one thing to nail down a single factor while holding all else constant. It’s another to analyze several moving targets with uncharted trajectories. Global events that have temporarily dislocated prices create trading opportunities. Take advantage of the shorter-term impact but avoid trying to stack one inflammable factor on top of another. Simple is often the best. For me, it’s quite difficult to analyze the net impact of China reopening and Fed rate hikes together with any precision. “Alert and quick”, a short-tailed rabbit focuses on one thing at a time and acts quickly. Pick Stocks and Protect Your Positions Many stocks were beaten down sharply. The chart below contains a list of the worst performing sectors and the biggest losers in the S&P 500. Data source: FactSet. In the Tech-heavy Nasdaq 100, some of the biggest losers were (data source: Nasdaq): • Rivian Automotive, $18.43 (-82.1%) • Tesla, $123.18 (-68.9%) • PayPal, $71.22 (-64.4%) • Warner Brothers, $9.48 (-62.8%) • Marvell Technology, $30.04 (-60.0%) • Netflix, $294.88 (-54.7%) • Intel, $26.43 (-50.7%) • Micro Technology, $49.98 (-48.9%) Today, the once overpriced Big Techs are now a bargain. My reasoning: many troubles facing Big Techs are non-recurring and already priced in. Those companies going through strategic changes and large layoffs may be positioned to survive in leaner years ahead. There are many of them, including those in the above lists. Some are S&P 500 component companies, while others are in the Nasdaq 100. I would, however, caution betting on any single stock. It’s a good idea to put our eggs in more than one basket and spread our investment in several sectors. As I discussed earlier, the stock market is not out of the woods yet. It would be wise to protect our long positions on the downside using precision hedging tools such as CME Select Sector Futures. • E-Mini S&P Communication Services Select Sector (XAZ) • E-Mini PHLX Semiconductor Sector (SOX) • E-mini Nasdaq Biotechnology Index (BIO) • E-mini S&P Health Care Select Sector (XAV) • E-mini S&P Materials Select Sector (XAB) • E-mini S&P Technology Select Sector (XAK) • E-mini S&P Industrial Select Sector (XAI) Trade Idea (For Illustration Only) Tesla (TLSA) lost 66% YoY while the S&P Tech Sector (XAK) was down only 25%. I think TLSA is oversold and want to buy some on the cheap. However, I am concerned that a recession would push the Tech sector down further, dragging TLSA along with it. As a hedge, I would place a short futures contract on XAK for each 100 shares of TLSA. Initial investments are: • 100 shares of TLSA @123.18, $12,318 • 1 XAK short futures contract with initial margin of $11,000 Happy trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
Editors' picks
CME_MINI:ES1!Short
by JimHuangChicago
20
Takeaways from the Fed Chair SpeechCBOT: Micro E-Mini Dow Futures ( CBOT_MINI:MYM1! ) The Fed’s 2022 Rate Decisions While we reflect on 2022, an eventful year full of “the unexpected”, rate hikes have undoubtedly dominated the headlines. In eight rate-setting Federal Open Market Committee (FOMC) meetings, the US central bank hiked the Fed Funds rate seven times, taking it up from 0.25% to 4.50%. The US Consumer Price Index (CPI) was 7.0% in December 2021. After a quick runup to 9.1% in the first half of the year, it came back down to 7.1% in November 2022. If the trend continues, we may end the year with an inflation below our starting point. However, current level is well above the 2% policy target. While the Fed emphasizes the need for on-going tightening, it expects inflation to be above 3% at year-end 2023. The Fed is on the right track, but there might be more to do. How did the Dow Jones Industrial Index React to Fed rate hikes? The Dow (DJIA) reached all-time high of 36,952.65 on January 5th. It pulled back 22% to 28,852 by September 30th on the back of three consecutive 75-bp rate hikes. DJIA closed at 32,920.46 on December 16th, down 10.9% year-to-date (YTD). The Dow’s Price/Earnings (P/E) was 20.49 on last Friday, down 6.9% from 22.01 year-over-year (YOY), according to Birinyi Associates/Dow Jones Market Data. For a comparison, S&P 500 hit 4,766 at year-end 2021 and closed at 3,852 last Friday, down 19.2% YTD. The P/E ratio for S&P was 18.91 now, down 35.1% YOY (28.69). Nasdaq 100 closed at 15,645 at year-end 2021 and settled at 11,244 last Friday, down 28.1% YTD. The P/E ratio for Nasdaq was 23.52 now, down 32.2% YOY (34.71). What do the datasets tell us? The Dow experienced a smaller correction (-10.9%) this year, compared to the S&P (-19.2%) and the Nasdaq (-28.1%). Its valuation, as measured by P/E ratio, is in line with the S&P and Nasdaq, all in the range of 19-24. However, the Dow’s P/E declined less than 7% from its top, vs. over -30% drop for both the S&P and the Nasdaq. Any trading opportunities? On December 14th, DJIA opened flat at 9:30AM. It began to fall after the Fed released its rate decision at 2:00PM. The index nosedived when Fed Chair Powell delivered his speech at 2:30PM Eastern Time. By the end of the following trade day, as investors fully digested the Fed’s policy, DJIA lost 884 points, or -2.6%. I put together a cheat-sheet to decode how DJIA anticipated and reacted to Fed Chair speeches throughout 2022. I denote T as FOMC date and T+1 the next trade date; Market Open at 9:30am, Market Close at 4:00pm; Rate decision release at 2:00pm, and Fed Chair Speech starts at 2:30pm; all the above in eastern time zone. Market reactions are represented by Up and Down. From Market Open (T) to Market Close (T+1), the changes in DJIA value were January -342, March +829, May -174, June -643, July +665, September -743, November -575, and December -884. All market data on DJIA is from Yahoo! Finance. Market anticipation and reaction were mixed in the early stage of this rate hike cycle. However, more recently, investors tended to have a rosy picture going into the FOMC, trading on the assumption of Fed Pivot. Each time, the Fed Chair speech brought them back to the reality of continued monetary tightening. DJIA declined six out of eight times. Average two-day change for DJIA during the last three FOMC meetings is -734 points. If we were to place a Short Futures order for Micro Dow Futures (MYM) for two days, we would have made a very nice Christmas bonus. MYM contract notional value is $0.50 per index point. Initial margin is $750 per contract. Hypothetically, if we captured 400 points, our 2-day payoff would be $200, or +27%. What’s the takeaway? Trading opportunities exist because the market is not aligned with the Fed. While Chair Powell made the point of fighting inflation forcefully over and over, investors did not take him seriously and kept dreaming of reasons for the Fed to end monetary tightening. While the Fed moderates rate hike to 50 bp, Chair Powell states that 4.25-4.50% Fed Funds is not restrictive enough. He emphasizes the “on-going” need for tightening. Policy target for inflation is 2% and there was never a discussion to raise it. It’s very clear that the Fed’s overarching goal is to bring inflation down to 2%. Pausing is premature. Next Fed meeting is on Jan. 31st - Feb. 1st. If DJIA repeats itself and moves up ahead of the rate decision, we may explore day-trading opportunities. In addition to the DJIA futures, similar strategies can be applied to Micro S&P 500 Futures (MES). MYM traded 285,803 lots with an open interest of 48,564 last Friday. Micro S&P is even more liquid, with daily trade volume exceeding 2 million lots. An alternative to the futures strategy is Options on futures. Put options on the March MES contract is currently quoted at $24.00. Options have bigger upside potentials if your market forecast is correct. Happy Trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
Editors' picks
CBOT_MINI:MYM1!Short
by JimHuangChicago
10
No secret‼️👀😉🔴inflation🔵rate⚫️marketsNo secret‼️👀😉 🔴inflation up⬆️ 🔵rate hikes⬆️ ⚫️markets down⬇️ 🔴inflation down⬇️ 🔵rate cuts⬇️ ⚫️markets up⬆️ Bitcoin and Crypto equal markets like DowJones NASDAQ and Co Chart 1 1972 - 1986 Chart 2 current situation - see update What do YOU expect in points of inflation? Let me know your thoughts in the comments🤗 ⬇️⬇️⬇️ Likes and Follow for updates appreciated🤗 Disclaimer: Not financial advice Do your own research before investing The content shared is for educational purposes only and is my personal opinion
TVC:DJI
by Crypto4Everybody
1
I Smell a Santa Claus RallyWith inflationary expectations low, a decrease in CPI and Core CPI, a likely slowing in interest rate hikes, there's too much positive news in the short term to ignore the likelihood of a near-term rally. Still, some hinges on Jerome Powell's outlook tomorrow, but I expect him to keep language as soft as his last speech. Last month, he was still very domineering in his tone on inflation, but the last FOMC meeting was much softer. I expect that again with inflation ticking down as proof of low inflationary expectations. I mean, you can hear people freaking out about the economy everywhere. I don't think inflationary expectations are high lol. Listen to his last speech and you can hear a dramatic tone shift. Here's last FOMC Press Meeting After rate hike in mid November: www.brookings.edu HARD LANGUAGE Here's his "Inflation and the Labor Market" speech on 11/30: www.youtube.com SOFT LANGUAGE Long term? You'll have to look at my first post to see that. Enjoy, and you can find a link to an Economic Release calendar down below for you to save. InTheMoney
TVC:NDQLong
by InTheMoneyAdam
5
EURJPY long End of Day trend follower (EOD)Here is what the fundamentals are following the ECB rate decision today, words from ©Lloyds Bank European Central Bank (Dec): We're not pivoting The European Central Bank (ECB) raised interest rates today by 50bps, in line with expectations. It follows 75bp hikes in the last two meetings in September and October, and a 50bp rise in July. There was broad agreement (not unanimity) on the decision and it brings the deposit rate up to 2%. There were similar increases in the main refinancing rate and the marginal lending rate to 2.5% and 2.75%, respectively. Policy rates have been raised by a total of 250bp since July (Chart 1). Although the hiking pace was reduced today, the ECB warned that interest rates will “still have to rise significantly” and that they will be kept at “restrictive levels” to dampen demand and guard against second-round effects on inflation. President Christine Lagarde indicated that more 50bp rises could occur early next year (the next update is on 2 February). She said, “we’re not pivoting” and that the ECB is “in for a long game” and there is more ground to cover. Current inflation was described as “far too high” (Chart 4) and forecast to stay above target for what is seen as “too long”. The ECB’s new quarterly economic projections upgraded inflation for 2023 to 6.3% (from 5.5%) and for 2024 to 3.4% (from 2.3%). The first forecast for 2025 is 2.3%, still above the 2% target (Chart 2). The ECB envisages a “short and shallow” recession – while next year’s GDP growth was revised down to 0.5%, it remains above the consensus forecast (Chart 3). Detail on the start of quantitative tightening (QT) – the reversal of QE – was also provided today. The ECB said that from March it will no longer reinvest fully the proceeds from maturing assets held in its Asset Purchase Programme (APP) portfolio. From March until the end of Q2 next year, the average decline will be €15bn a month, meaning that about half of estimated redemptions wil be reinvested (Chart 7). This degree of detail could also be interpreted as hawkish, because it reinforces the impetus to reduce the ECB’s balance sheet (Chart 6). Overall, while today’s interest rate decision was expected, the messaging was nevertheless surprisingly hawkish. There seems to be increasing disquiet about persistent upside surprises to inflation and the extended period in which it is expected to remain above target, while the economic downturn is now perceived as potentially less severe than previously feared. The market reaction saw the euro rise above $1.07 for the first time since June, while the pound fell below €1.15. Markets now expect the ECB ro raise interest rates above 3% next year. Hann-Ju Ho Senior Economist That may be the fundamental reason and may be I am a little early in my trade idea as today's candle hasn't closed.I am assuming that we don't make a new higher high before the end of the NYC session.
Long
by Macrobriefing
Daily Bitcoin UpdateUS FED DECISION Bitcoin Reached 18400 before selling off to 17800 due to the market's reaction to the US Fed's decision to raise their key interest rate by 50 basis points during yesterday's session. As we all know, the market tends to react positively in a low-interest environment. Although this key rate increase is lower than the previous quarter's 75 basis point increase, it is still a rate increase nonetheless. TECHNICAL SIDE The price of Bitcoin still closed slightly higher in spite of the selloff during yesterday's session which means that there's still a certain level of interest in this asset. I added more units today at 17899.23. I set my key support level at 16000 while my key resistance price is set to 21200.
BITSTAMP:BTCUSDLong
by erickluzonghimself
1