Important Level For DXYHi all!
I think we are facing a pivot for the DXY that could bring significant changes to global markets.
IF the DXY doesn't Hold the 90 level and bounce higher, THEN I believe we are looking at new highs across the risk asset spectrum with the DXY going into tail spin and falling out of
this macro down trend channel, possibly to the low 80's even.
However, IF DXY does hold the 90 level and bounces with confidence, I believe it will be the sell signal and risk off signal across the risk asset spectrum. And of course, this could
send DXY well above the down trend channel its been in.
CPG's are planning on raising prices by an avg of 10% next few months so inflation is real regardless of what the market makers *cough cough* sorry I mean Fed chair persons think are going on in the economy. All my models had 10% inflation baked into them as an assumption back in Dec. '20, and subsequently they priced the SPY at 420. We keep getting close to it and seem to be floating there in a state of euphoria, no? Idk, but sounds like 420 to me haha. Hoping we have a correction to ease pressures on the system, but am worried about a crash tbh. I think risk is expensive and safety is worthless so buy insurance and go ham fam!
My ideas are strictly my opinions and are not advice or recommendations. Please make every effort to understand all risks associated with investing or trading any security before purchase or sale. Not Financial advice. Not financial recommendation. Just my personal opinions.
JG
US10Y
Bull Flag Setting Up?Hi all!
Looks to me like there is a possible long trade here with the possibility as I see it in a bull flag set up. This fits my macro analysis bias related to various other assets. Nevertheless, it should be an interesting next few months.
Please note that this is not advice or a recommendation. Please do not invest or trade anything without proper understanding of the risks associated with a security.
NZD/ USD Kiwi/ Dollar &10Y Bond Yields I was stopped out on the last pattern i posted on this pair and now entered on another pattern. An alternate Bat pattern. In the white ellipses we have where the HSI Arrow printed in an area of extreme reading then PA came down out of reaction and both oscillators made it at least the 50 line respectively, and then did the HSI "Check back" that Scott Carney uses was done on the second white ellipsis. if Pa is able to close below the .7166X level we could be in a position to head down as the dollar strengthens. Its all Dependent on what the 10Y Yields hold in store. Currently waiting to see how the hour closes. i will ad pictures of the hour look and 10Y Yield synopsis too.
1H Time Frame looking for a close below the neck line for a nice ride down.
the daily 10Y Yield
For those not familiar with the 10Y Yield it is the true valuation of the US Dollar. The yield is inverse of the bond price as yields go up prices go down to entice investors to invest in the US Economy (Dollar) and as yields go down Prices go up to protect potential buyers from buying a low yield investment. But, where the money is made in the bond world is that when the yields go down the Bond yield is locked. so at the end of the 10 year period the US will pay the holder of the bond the yield printed on the bond regardless of what the current yield is doing. So, lets say Investor A bought the bond at the very low for lets say 100$/ a bond and he bought 100,000$ worth so that means the yield might be locked in at 2%. Lets say the investor A is strapped for cash, so he enters the bond market with his 2% yield bond it looks very enticing because the current rate is 1.5% so, Investor B approaches Investor A with saying "hey ill buy your bond for 101,000 dollars" Investor A realizes he made a profit of 1,000$ and needs the cash now so he agrees to sell it. Now, Investor B holds the 10Y Bond at 2% and if he decides to hold it to fruition then he too will make a 1,000$ profit on his investment. Now, this is why the bond rates are so important to the US dollar because it will let you know where the long term investors are looking at putting their money as good foundation for their portfolios. This is super simplified on how the bond market works and i am by no means a bond trader. So, if there are any bond traders that would like to clarify or correct me please do so i will greatly appreciate it.
the technical is that currently the yields have hit a .382 retracement, and in a very strong trend prices usually bounce off the .382 before moving further. so right now we are printing an indecision candle and so we could see more upward movement for the bonds. A lot of people are worried about the bond yields making it to 2.00% so fast and that it might cause inflation and they are partly right. Because the US is going to have all this excess cash flow in the market making the dollar weaker because its readily abundant in such a short time. A 2% yields has not been seen since 2019. So, we shall See
Driftwood for Breakfast AgainUS Futures continue to drift sideways in what is shaping up to be another mind numbing day of price action. The S&P literally hasn't moved more than a couple points since last Friday. European and Asian markets were broadly higher, and the Vix slid back to a 16 handle.
It's so frustrating watching the same meaningless price action day after day. But, both Biden, and Powell, are set to speak today on critical matters of the economy, and market, potentially shaking things up for a change. Biden will be revealing more information on his new $1.8 Trillion plan to support (print) GDP. Mean while, the Fed's Powell, will be expected to address bond purchase tapering as early as Q4 2021 (which could send markets into a tail spin), as well as sky high asset price inflation (housing prices are rising 4 times the Fed's inflation target), which is now bleeding into goods and services, punishing the working class, while being masked as healthy inflation, and an economic rebound. It's horse sh*t, folks.
The US Dollar rose slightly to a 91 handle revealing signs of weakness elsewhere. We look to commodities which are notably down across the board. Gold, Silver, Platinum, Lumber, Sugar, Soybean Oil, Corn, Wheat, and Oats, were the hardest hit, and down around 2-3% on average, with Lumber down a shopping 10%. BMO sees lumber crashing in the second half of the year, with an estimated correction to the tune of 61.8%, bringing the price to $415/mbf as we approach 2022.
Crude was up around 1% with WTI sitting at 63.59, and Brent at 66.98. We're seeing the price of gas rise to recent high's once again, as global supply chains struggle to catch up with demand, and OPEC (Saudi) relentlessly price fixes oil to keep their profits rolling in. The blatant cuts in global supply chains, and the neverending synthetic demand created by printing GDP across global markets, is doing little but distort the economy, and prices, while making the working class poorer. Fiat is on fire, and it's all the bottom 45% of people in the US have. It's criminal. And it's all going essentially unnoticed by the majority of households. We may be witnessing the greatest ponzi in history, straight up dwarfing the response to the 2008 Great Recession. Trade accordingly.
*I am/ we are currently holding positions in UVXY, HUV, HQD, QID.
US10Y Yield Poised to ExplodeAfter a strong 7Y YST auction, the US10Y yield just broke out above the 21 day EMA. We're back at 1.615%, and poised to blow up as the week progresses. This recent buying frenzy in bonds may be exhausted, and yields could be poised for a solid spike higher (potentially on Powell remarks about future monetary policy tightening tomorrow). Fed QE bond purchases are still running at $120 Billion per month, so any hint of tapering could send markets into a tailspin. Especially as the Treasury will increase bond supply simultaneously. Don't even mention an increase in the IOER, or banks will close credit lines faster than you can blink...
GME at Critical ResistanceThere's a possible trade here on GME. We're at critical resistance, and seeing an initial rejection. The daily RSI, as well as the MACD are looking bullish. We may see a breakout above the triangle, leading to another epic short squeeze near the ATH. Having said that, this would be a good time to trade extremely tight stops, as the broader market is potentially on the verge of a correction, and GME would take a hard hit toward the lower band of the triangle, if one were to materialize.
50DMA Support Held, Bounce in Bonds Over?The US10Y yield has seen persistent support at the 50DMA since August 2020. Let's see if the 21 day EMA converges with the 50 potentially reversing the recent rise in yields, or if we see a strong bounce off the 50DMA, and continue toward the 2% level, putting pressure on growth oriented equities.
BONDS 10year yield formed the 1st 4H Death Cross since SeptemberThe US10Y has just formed a Death Cross (the MA50 (blue trend-line) crossing below the MA200 (orange trend-line)) on the 4H time-frame since September 24, 2020!. That is technically a bearish formation. It gets even more bearish if we count the fact that the price got rejected on the 4H MA50 after the bounce. The last time we had such a rejection on a 10-20 day selling sequence was on June 16, 2020.
This pattern has the capacity to stop the uptrend of the recent months and initiate bearish momentum on the medium-term. The green zones indicate potential Supports. Personally, I expect the price to drop all the way to the 1W MA50 (yellow trend-line) which is the pivot between being bearish or bullish on the long-term.
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It's Make or Break for the Burning DollarThe Dollar (DXY) is seeing support at the lower band of the wedge, and if it holds, we could be looking at potential upside to the 95 level, where our monthly target is sitting. If we lose this support, the dollar has downside to the previous low from February around 90.
SHORT POSITIONUS10Y;TECHNICAL
FORECAST:BEARISH
The 10-Year Treasury yield slips to a fresh monthly low (1.53%), and recent market dynamics may keep the Greenback under pressure as the economic docket remains fairly light ahead of the Federal interest rate decision on April 28.
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According to Nomura, UST Shorts are Still CoveringWe're seeing a not so unexpected bounce in Treasuries, which could potetially see the 10Y yield back at the 1.50% level as early as today. Having said that, on the monthly timeframe, we're looking at an RSI of 53, so we still have room to run, potentially to the 2% - 2.25% level by EOM. Let's see how the cookie crumbles as bond bears potentially get ready to take advantage of the new liquidity...