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XLF is going to take a nosedive as the US turns dovishRight, a bit of a congested chart... In white, we have $XLF, purple, the US unemployment rate, orange is the European bank index and in yellow, we have the effective Fed Funds rate (US interest rate). Recent rhetoric from the Fed has been pretty dovish, and we have had a pause in hiking rates, with there likely to be absolutely no hike this year. If an economy that is apparently 'doing well' cannot afford a rate hike, is there not something seriously wrong? Let's take the European banks... Since the crisis, they've experienced negative rates whilst the US has had positive real rates... See, banks like interest rates. It allows them to make money, and allows for productive lending since there is not adverse selection when it comes to borrowers. The Fed is about to follow the ECB's lead... I think Fed member Williams said they could go to negative rates if needed... Which is crazy, since all they end up doing is creating zombie firms. So let's get this idea set... The Fed are pausing with rate hikes... They're likely to stop the balance sheet run off... And unemployment is at a record low... Every time the Fed has stopped their rate hike cycle, unemployment has increased and XLF has fallen off... Is that a decent enough thesis to get short if we start seeing unemployment data tick up? Well, we already have... we've just had the highest Q1 layoffs in the US since the financial crisis... Buckle up!
AMEX:XLFShort
by FinkPro
Updated Fed Chairperson PatternPrevious Fed Chair and Stock Market (divided by CPI, to make it "real"). You can see how there is turmoil typically at the beginning of a new Central Bankers term. Bernanke, not initially as he sat on top of a giant credit bubble that was set to pop. Greenspan had the worst initial stock market performance, but Bernanke had the worst performance with a close tie to Arthur Burns (under Nixon-Ford-Carter in the inflationary late 1970's). There is so much to learn from history that is often mis-taught and oversimplified in history books. Yellen ended up the 2nd shortest term as a Federal Reserve Chairperson, 2nd to William Miller during Carter's tenure. Conclusion: Looks like there is a wide variety of possibilities.
DJ:DJIEducation
by timwest
6
Shining your future... Hi, fellas! While they don't unlock my last ideas (i upgraded my plan to do it... yes, spending more, to support you!), i will talk about Gold. The only trustable value reserve in my opinion for HODL... My advice is: buy gold always you can. In some years you gonna love me for it! Tip: revert a part of your profits with crypto to gold. The music for this idea is: "When everything, everything, everything you Touch turns to gold, gold, gold Everything, everything, everything you touch Turns to gold, gold Ooh, gold Ooh, gold Ooh, gold Ooh, gold" I cannot to put links, so, search by music named Gold, of Imagine Dragons, and listen! Yeah! Touch your profits and turn it to gold! Goooold... Goooold!!! In a montly view, we see a broken main LTB last august. An ascending pretty simetrical triangle, and a pretty good 3rd Elliot wave. Surf on the waves, watching the fibbo's, and respecting the tube (pitchfork), and till 3 years max we gonna see one ATH! Hope you enjoy! This one is just a pastime with a little tip to your money management! Warning: this is a personal analisys, and definitely is not an advice to buy! Capital Management is highly recommended! Always DYOR! Mask loves you all, let's shine our pockets together !
FX:XAUUSDLong
by lem4sk
2
(4h) Short-Term Sell & Long-Term BuyAfter analyzing the bigger timeframe perspective of the GBPUSD, it seems that the market cycle for this pair is heading for a bullish trend . The Fed Interest Rate decision will determine the continuation of this trend, although it's more than likely that the Fed will maintain the current Interest Rate value until December 13th. Utilizing the Fibonacci Retracement Levels, we can expect a downward correction in the following days, followed by a long-term continuation of the original bullish impulse. So, for Scalpers , it's recommended to put a Sell order after the Fed decision as the price will move towards 0.5 level, possibly reaching the 0.618. Nevertheless, I'd say it's a good idea to place a Buy order once it bounces back, from these same levels, for the longer pip ride.
Long
by CarlosBMN
MACRO VIEW: IRX REFLECTS RATE HIKE EXPECTATIONSIRX, the 13-Week Treasury Bill yield has spiked above its relevant highs of 0.05 after the recent FOMC announcement, which hinted of a potential review of the Fed's Target Range for the Federal Funds Rate (now at 0-0.25%) This spike in prices indicates that at the moment the expectations for the rate range hike are present, as IRX is closely correlated to Federal Funds market (see Daily Effective Federal Funds rate at NY Fed website) Thus if IRX doesn't roll back below 0.05, until l the next Fed meeting, the rate range hike could be in the cards!
ILong
by Killy_Mel
31 Year US Bearish Bond Yields Coming to an EndThere are many reasons why bond yields should go down, however, there are many more positive reasons why bond yields will go higher. Demographically Challenged Our largest demographic population on the planet, not just in the US, is the baby boomers born 1944 to 1964. Largely early baby boomers born during WWII and up to the late 1940's have already started collecting on retirements. For these seniors to live comfortably in retirement they will need to draw down on a steady income derived from higher US Bonds yields. Boomers can no longer afford to risk money in equity markets, they will be forced to invest conservative in fixed incomes. US Political Movement For more than 30 years the US has run up debts with both political parties at fault. However, more recently we are seeing a shift towards a popular following of younger fiscal conservatives in the Republican party. Many of these fiscal conservatives candidates govern states and have taken on the challenge of run away debt spending. Fiscal Conservatism will also appeal to the US largest voting class, baby boomers. Baby boomers are fully aware that more debts equals more instability in the US, and want to see a more fiscal responsible governments. To appease the baby boomers wishes, whoever it is that leads the US, they will implement a strategy of spending cuts and debt reductions. Spending cuts and debt reductions will also help US Treasury Yields increase. Federal Reserve Raising Rates Our own Federal Reserve has been sounding off the warning now for almost a year, it's only a matter of time before Janet Yellen starts raising benchmark rates. Although US economy has entered another soft patch, which will require the Fed to talk down the rate increase in 2015. However, sometime in 2016 we will see our first rate increase in the US. I expect other countries like Great Britain to follow this trend of rate increases.
TLong
by QuantitativeExhaustion
30