PDBC trade ideas
PDBC Harmonics: ABCD and Butterfly PatternPDBC is an Invesco Optimum Yield Diversified Commodity Strategy No K-1 ETF (PDBC) is an exchange-traded fund that mostly invests in broad market commodities. The fund holds a diverse basket of commodity futures and aims to mitigate negative roll yield in its contract selection. The fund is structured as an ETF and is actively managed.
In this idea, there is an abcd pattern in confluence with a butterfly pattern. The potential range of the abcd pattern contains the bat pattern price points. I'd begin buying at 9.75, expecting a reversal by 8.09.
PDBC has a strong quantitative score around 7 - 8 with analyst ratings of strong buy and hold. The dividend is awesome at 13.51% yield/per year (I'd expect to hold this position for about a year). I would buy PDBC long from the potential reversal zone, beginning at 9.75, and incrementally buying at key levels, then hold until take profits. I think, price will reverse right around 8.09 price point. If one bought with this strategy, their average would be somewhere around 8.92. I would sell half at 0.382 retracement and the other half at 0.618 retracement. Gains are approximately 43.4% - 77.6% at take profit targets. Cumulatively, adding dividend to gains, that's approximately 56.9% - 91.1%. Averaging those totals gives us approximately a 74% gain on this trade.
Good luck and trade safely!
PDBC long We can see very high inflation in coming days.
This has been consolidating for 6 weeks and at the support of most moving averages on every timeframe.
Target 1 $19.90
Target 2 $22.38
Target 3 $25.22
My stop loss below: $17
Note: I am no financial advisor, post here for fun.
Economic Game Mechanics: Part 2DISCLAIMER
This is in no way, shape or form, fluid and function, an analytical, qualitative or intelligent compte rendu. The function of this essay is the maddening diatribe of a curious author, and how this one manages micro- and macro-economic data for a critical investigation into the micro- and macro-economic world. This text is not suitable for direct consumption, and should never be used as a primary or secondary source. The contents of this text are often illogical and offensive, and great care should be given to the reader's personal qualifications and senses. This text is delivered on TradingView, where the userbase is expected to have a level of financial and investigative understanding that would enable them to query appropriate thoughts and abdicate nonsense to the void. May whatever sovereign and omnipotent being you believe in, guide you through this.
Important note: There are many, many figures here. Please pay attention very carefully to the axes and trends, not specifics. Real data is only as real as the reader allows.
Thesis
The long and short is that the dollar has done exceptionally well compared to it's competitors. America's economy may not have the warm and fuzzy feeling on the inside, but outside, especially against the backdrop of failed-austerity measures across Europe, worsening food and geopolitical crises in Africa, Putin's apocalyptic crusade, etc., etc. etc; America's economy looks amazing. The S&P500 is less than 10% off all time highs made just a few months ago. Six companies are worth over 1 Trillion Dollars, Wooly Mammoths of Unicorns. Corporate profits aren't just at an all time high, they have grown 20% more over GDP since 2005, a clear breakage in equilibrium of monetary wealth accrual. And in turn, the economic conditions look incredible among the top 1% of wealth owners, growing well over any single inflationary expense, not that it would affect their margins. Utilizing available economic data on TradingView, and creating a few theoretical arguments, an average of the sum of large numbers per se, the economic contrast is stark. The cost of living is rising quickly, with official inflation numbers coming in over 7% for the year, while using the original cost of living equation from the 1980s, before Volcker and crew changed it to make themselves look better, yields a pleasant 16+%. If the cost of living is increasing more than the profits of working, either wages must increase, cost of living must decrease, or system participants will need to spend less, with the most vulnerable suffering. One of the more interesting components coming from the second of the next graphs is the rapid increase in a theoretical systemic "affordability" - i.e. the wealth of the bottom 50% divided by the cost of living. While any single point would not make sense, the general trend over time offers some clue as to how the bottom 50% financially perform, whether improving or deteriorating.
Substance is material and technological assets, the labour force, it's labour, the manifestation of it's labour, the ability of thought of it's labour. While the mountain may have gold, it's dubious getting it out any other way than with labour. Buried in this abstract writing is a simple ethos that this author has been waiting forever to see realized; the labourer is the mightiest piece of the sovereign state. As the rest of this decade develops, reminescent of the 70s, labour will continue to strengthen. As this analyst writes these words, the first Amazon warehouse has formed a local union, a local collective of labourers. Starbucks has unions forming right and left, so much so the all-macerating Howard Schultz came back from the dead to give this chain's figurehead one last crumb of profitable margins. Uber and Lyft's gig-work model of weaponizing free hours for low-entrance cost labour has started to come to a close, as the labourer finds profit margins unprofitable. It isn't so much so that Uber and Lyft were ever terribly profitable to begin with, but the taxi game isn't new, their issues were as transparent and inevitable as they were ever going to be; their decision to add on rampant workplace sexual assault wasn't even novel. However, the way the 70's ended with high inflation will be the most important aspect moving forward. Labour is the hidden cost of commodities, and as labour increases in value and expense, so too will all downstream products. The ultimate trick will be scaling, which requires coordinated Congressional bills ensuring appropriate tax-redistributions, supplementary wages/stimulii to socio-economic groups in need, minimum wage laws, windfall profit controls; Executive directive across all government agencies that can appropriately support the wage-cost balance in a buffering manner while ensuring equal weighting on the correct side; Banking ensuring a buffer for corporations caught in different phases of the wage-cost spiral that will need to take on some temporary debt to allow for a smooth transition in wages and pricing. These are fairly obvious markers showing the system is preparing itself for the inevitable catalyst, and as the system refutes actuality, fights against safeguards and supports, then the system will be brought further into disequilibrium. Still, the same economic variables that constrain labour are available to squeeze, but at great risk.
Continue to Part 3
Inflation Is Real and Commodities Are Showing ThisInflation fears are getting real yet there appears to be no sign of the money printing ending as a +3 trillion dollar budget agreement has been reached this week in the US, and the unbelievable rally in commodities since March of 2020 is a manifestation of this.
Its been higher higher after higher high and it appears to be attempting to put in another lower high after consecutive lower highs the last 16 months as well.
Should the upward sloping green trend line serve as support once more, look for a retest of the PDBC's all time high at roughly 2% from where we are currently to the upside.
If the ETF can find support above that level, a 10% move to the top of the channel could be instore.
If the trend breaks, look for support at $19.35. Ultimately, the bears would want to see this thing break out below $18.91 to confirm a bearish reversal of commodities.. a feat that appears to be a tall task given the current state of affairs with the macros.
