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QQQ Outlook 0626-30/2023Technical Analysis: Last week’s price action put NASDAQ:QQQ back inside the bullish channel we’ve been watching since March. We should see come corrective price action this week before tech runs higher. Bulls will look to see if we can stay above last week’s lows at 360. It is crucial bulls hold this level or we could see the daily fair value gap that could be filled below at 357.66. Bears will want to see a breakdown under the daily fair value gap, where we could test the strong monthly level at 354.43. If we lose the levels above, we can look for a test of the lower trendline in the upcoming weeks, and possibly a large gap to fill to the downside from 336.67-332.91. Inside this gap is the 50SMA and the 61.8% retrace at 334.00. Upside Targets: 364.57 → 370.10 → 373.83 → 380.76 → 386.28 Downside Targets: 360.00 → 358.97 → 357.66 → 354.43 → 352.46
NASDAQ:QQQ
by peterjames_6
Trading Plans for FRI. 06/23 - Bull Run Consolidation, ContinuedS&P 500 INDEX MODEL TRADING PLANS for FRI. 06/23 In our trading plans for Fri. 06/16, we wrote: "The spectacular bull run of the last few weeks fueled by speculation around the Fed policies and, possibly, an epic short squeeze, could be consolidating in the week ahead". This has played out as anticipated with yesterday's consolidation. It appears gaining traction with Powell's comments about inflation and interest rates this morning. The index slightly consolidated downwards from 4409.59 from the close on Thursday, 06/15 to the close of 4381.89 yesterday, Thursday, 06/22.  Our models indicate 4315-4325 as the next support level, which might be tested in the coming days. The potential bull trap cautioned about by our models continues to be in play. Those bulls who must have noted our models' trading plans and took some money off the table would have saved themselves some heartache. Bears should be nimble with their shorts. It is a bull market until it is broken - currently, this bull run is not broken, yet. Positional Trading Models: Our positional models indicate going short on a break below 4350, with a hard stop at 4406, effective from 11:00am EST today. By definition, positional trading models may carry the positions overnight and over multiple days, and hence assume trading an instrument that trades beyond the regular session, with the trailing stops - if any - being active in the overnight session. Aggressive/Intraday Models: Our aggressive, intraday models indicate the trading plans below for today. Aggressive, Intraday Trading Plans: For today, our aggressive intraday models indicate going long on a break above 4393, 4375, 4366, 4352, or 4341 with an 8-point trailing stop, and going short on a break below 4390, 4363, 4349, or 4338 with a 9-point trailing stop.  Models indicate explicit long exits on a break below 4373. Models also indicate a break-even hard stop once a trade gets into a 4-point profit level. Models indicate taking these signals from 11:01am ET or later. By definition the intraday models do not hold any positions overnight - the models exit any open position at the close of the last bar (3:59pm bar or 4:00pm bar, depending on your platform's bar timing convention). To avoid getting whipsawed, use at least a 5-minute closing or a higher time frame (a 1-minute if you know what you are doing) - depending on your risk tolerance and trading style - to determine the signals. (WHAT IS THE CREDIBILITY and the PERFORMANCE OF OUR MODEL TRADING PLANS over the LAST WEEK, LAST MONTH, LAST YEAR? Please check for yourself how our pre-published model trades have performed so far! Seeing is believing!)  NOTES - HOW TO INTERPRET/USE THESE TRADING PLANS: (i) The trading levels identified are derived from our A.I. Powered Quant Models. Depending on the market conditions, these may or may not correspond to any specific indicator(s). (ii) These trading plans may be used to trade in any instrument that tracks the S&P 500 Index (e.g., ETFs such as SPY, derivatives such as futures and options on futures, and SPX options), triggered by the price levels in the Index. The results of these indicated trades would vary widely depending on the timeframe you use (tick chart, 1 minute, or 5 minute, or 15 minute or 60 minute etc.), the quality of your broker's execution, any slippages, your trading commissions and many other factors. (iii) These are NOT trading recommendations for any individual(s) and may or may not be suitable to your own financial objectives and risk tolerance - USE these ONLY as educational tools to inform and educate your own trading decisions, at your own risk. #spx, #spx500, #spy, #sp500, #esmini, #indextrading, #daytrading, #models, #tradingplans, #outlook, #economy, #bear, #yields, #stocks, #futures, #inflation, #recession, #fomc, #fed, #fedspeak, #softlanding, #hawkishpause, #pause
SP:SPX
by TradersAIDotCom
Gold:the monetary commodity’s fate in the hands of central banksGold is arguably the most sensitive commodity to monetary policy. The metal operates more like a pseudo-currency than a regular commodity (a regular commodity’s price is driven by the balance of supply and demand, gold is driven by many of the macro determinants of currencies). After hiking rates every meeting since February 2022, the Federal Reserve (Fed) took a pause in June 2023. The central bank has lifted the upper bound of Fed Fund target rates from 0.25% to 5.25% over that timeframe, marking one of the most rapid rate hiking cycles in history. At times, the Fed was hiking in 0.75% clips. Rising interest rates were an extreme headwind for gold for most of this period. Can gold investors breathe a sigh of relief now? Is this a temporary pause, or a halt on rate hikes? Well, if Fed Fund futures are to believed, there may be one more rate hike by September 2023. If the participants of the Federal Open Market Committee (FOMC) are to be believed, there could be several more rate hikes (with the median expectation of these participants pointing to a terminal midpoint rate of 5.625%, that is, an upper bound of 5.75%). Professional economists1 seem less sure of such decisive action, with the median looking for no change in rates this year (and cuts commencing in Q1 2024). Senior Economist to WisdomTree, Jeremy Siegel, believes the Fed is done hiking and that alternative inflation metrics, which incorporate real time housing inputs, show inflation running at 1.4% instead of the official 4.1% in May 20232. Market inflation expectations are not falling away as fast as we would expect. Judging by the 5yr5yr swaps, longer-term market inflation expectations are actually rising modestly. Higher inflation tends to be gold-price supportive (other things being equal). After hitting an all-time high in 2022, central bank demand for gold has maintained strong momentum. Official sector gold buying in Q1 2023 was the largest on record for the first quarter (albeit lower than Q3 2022 and Q4 2022). A YouGov poll, sponsored by the World Gold Council3 , showed that developing market central banks are expecting to increase their gold reserve holdings and decrease their US dollar reserve holdings. With a lack of forceful stimulus from the Chinese government, and still elevated gold prices in Renminbi terms, we expect a slowing of retail demand in China. In fact, Shanghai premiums over the London Bullion Market Association (LBMA) price slowed in May and remain low in June. Looking to WisdomTree’s gold price model, we can see that bond headwinds have clearly fallen away and US dollar depreciation (relative to a year ago) is offering gold some support rather than dragging prices lower. However, investor sentiment towards the metal has moderated since March 2023, when the collapse of Silicon Valley Bank (SVB) and the shotgun marriage between UBS and Credit Suisse Banks was announced. With the passing of the US debt ceiling debacle, there aren’t any specific risks driving gold demand higher. However, general recession fears and the potential for unspecified financial sector hiccups are likely to keep gold demand moderately high as the metal serves well as a strategic asset in times of uncertainty. Source: 1 Bloomberg Survey of Professional Economists, June 2023. 2 The alternative measure calculates shelter inflation using Case Shiller Housing and Zillow rent which annualise at 0.5% instead of the 8% that is biasing the Bureau of Labor Statistics CPI higher. 3 2023 Central Bank Gold Reserves Survey, May 2023.
COMEX:GC1!
by aneekaguptaWTE
1
Is It Time to Follow the Oracle's Lead?You may have heard of a certain Warren Buffett, and it seems like he might be onto something... Buffett, known as the "Oracle of Omaha," has demonstrated remarkable investment timing, or perhaps an innate ability to steer investment flows. This was clearly illustrated by his investment in Japan, which triggered a rally in the Nikkei to decade-long highs. While that window may have closed, Buffett has been discreetly bolstering his stake in another entity - Occidental Petroleum (OXY). If we scrutinize the timing of his purchases, it's apparent that Buffett likely had a price floor in mind. Intriguingly, his first purchase occurred when Crude was trading at a 15-year high! This leads us to examine Oil, which has been trading nearly 40% lower since mid-2022. Since our last discussion about oil, the Strategic Petroleum Reserve (SPR) has been further depleted, reaching its lowest level since 1983. The result of this drawdown is a diminished impact on energy costs as evidenced by the energy inflation index, which has not only passed its peak but has now turned negative. Interestingly, the Canadian dollar and the Norwegian Krone, currencies of major oil-exporting countries, have been outpacing the commodity typically correlated with them, Crude Oil. On the whole, it seems the energy commodity sector may have bottomed out, with all types of Oil and natural gas trading on an upward trajectory. In consideration of these factors, the outlook for oil leans towards the bullish side. The scarcity of oil in the SPR and the absence of energy inflation as a significant contributor to overall CPI make it unlikely for the U.S. to release more oil to depress energy prices. Coupled with the buoyant trend in the energy commodity space and the recent outperformance of major oil-exporting countries' currencies, it appears to be an opportune moment to consider a long position on oil. At the current price level of 72.33, risk managed trade points to setting the stops at the previous support of 66 and take profit level at 85. Each Crude Oil Future contract is equal to 1000 barrels of crude oil. Each 0.01 point increment in Crude Oil Futures is equal to 10 USD . The same view can also be expressed with greater precision using the Micro WTI Crude Oil, where each Micro contract is equal to 100 barrels of crude oil and each 0.01 point increment is equal to 1 USD. 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. Reference: www.cmegroup.com www.cmegroup.com www.eia.gov tradingeconomics.com
NYMEX:CL1!Long
by inspirante
GBP/USD dips after inflation jumps, BoE up nextThe British pound has edged lower on Wednesday. GBP is trading at 1.2724 in Europe, down 0.3%. GBP/USD spiked after today's inflation release but in currently in negative territory. The UK released the May inflation report today, and the results were a major disappointment, to put it mildly. With inflation falling for two straight months, there were hopes that the Bank of England's rate policy was slowly working and the downtrend would continue. The monthly readings showed that headline and core CPI eased, but the annualized readings were worse than expected. Headline CPI remained at 8.7%, above the consensus of 8.4%. Core CPI rose from 6.8% to 7.1%, above the consensus of 6.8%, the highest level since March 1992. The core rate, which excludes food and energy prices, is considered more important, and the 0.3% gain is a huge disappointment for the BoE. The Bank of England won't have much time to mull over the inflation figures, as it announces its rate decision on Thursday. There's little doubt that the BoE will have to raise rates for a 13th consecutive time, and today's inflation numbers mean there is a strong possibility of an oversize 0.50% increase. The BoE finds itself between a rock and a hard place, as it struggles to contain inflation without causing a recession. The resilient labor market has complicated the BoE's attempts to cool the economy, and the markets are projecting that the Bank Rate, currently at 4.5%, won't peak until 6%. High inflation has already caused a cost-of-living crisis, and more rate hikes will only exacerbate the pain. Fed Chair Powell begins two days of testimony before Congress on Wednesday. Lawmakers are expected to grill Powell about the Fed's rate policy. The Fed paused at this month's meeting but is expected to raise rates at the July meeting. Powell has said that he can pull off a soft landing that will avoid a recession and jump in unemployment, but he'll likely have to answer pointed questions from lawmakers who are concerned that higher rates will damage the economy. 1.2719 remains under pressure in support. Next, there is support at 1.2645 There is resistance at 1.2848 and 1.2950
by OANDA
GBP/USD lower ahead of UK inflationThe British pound is lower on Tuesday. In the European session, GBP/USD is trading at 1.2739, down 0.41%. The UK releases the May inflation report on Wednesday and BoE policy makers will be hoping that inflation continues to trend lower. Inflation dropped in April to 8.7%, decelerating for a second straight month. The consensus stands at 8.4%, and the good news is that those awful readings above 10% appear to be over. On a monthly basis, inflation is expected to fall to 0.5% in May, down from 1.2% in April. Inflation appears to have peaked and is heading lower, but nobody at the Bank of England is smiling. The UK is expected to have one of the highest inflation rates in the G-20 this year at 6.9% and the BoE's 2% target is miles away. Finance Minister Sunak has set a goal of lowering inflation to 5% by the end of the year, which seems feasible if inflation continues to downtrend in the coming months. The BoE will be in the spotlight on Thursday when it makes its rate announcement. The markets have priced in a 25-basis point hike at 70%, with a 30% chance of an oversize 50-bp increase. If inflation falls as expected to 8.4% or lower, the MPC should be able to proceed with the 25-bp hike, although central banks have a tendency of surprising the money markets. In the US, it's an unusually light data calendar this week. There are no tier-1 releases on Tuesday, and the markets are looking ahead to Wednesday, with Jerome Powell testifying before the House Financial Services Committee. Powell will have to clarify to lawmakers the Fed's interest rate path, as the Fed paused last week after ten straight hikes but expects to renew hiking in July. 1.2719 is under pressure in support. Next, there is support at 1.2589 There is resistance at 1.2848 and 1.2950
by OANDA
AUD/USD drifting lower ahead of RBA minutesThe Australian dollar has started the week with losses. AUD/USD is trading at 0.6848, down 0.39%. The Australian dollar gained 1.95% last week and has soared 5.2% in the month of June. The Reserve Bank of Australia releases the minutes of the June meeting on Tuesday. At the meeting, the Bank decided to raise rates by 0.25%, bringing the benchmark rate to 4.10%. This surprised the markets, which had expected the central bank to pause. Governor Lowe continued his hawkish stance after the decision, defending the interest rate as necessary since "upside risks to the inflation outlook have increased". Lowe has his hands full with sticky inflation, which rose in April from 6.3% to 6.8% y/y, above the consensus of 6.4%. The core rate fell from 6.9% to 6.5%, but this is much too high for the RBA, which has a target of 2%. The RBA has projected that inflation will not fall to 2% until mid-2025, leaving little doubt that the current rate-hike cycle is not close to wrapping up. The minutes should provide insights about the rate hike and what the central bank has planned moving forward. The RBA meets next on July 4th. The Fed is also very concerned with inflation but took a different approach, as it paused at last week's meeting after ten consecutive hikes. Fed policymakers got some good news on Friday, as UoM inflation expectations eased to 3.3% in June, down sharply from 4.2% in May and lower than the 4.1% consensus. Inflation expectations haven’t been this low since March 2021 and this is another indication that inflation is heading lower. The UoM Consumer Sentiment report climbed from 59.2 to 63.9, due to lower inflation expectations as well as the resolution of the banking crisis, according to the report. AUD /USD tested support at 0.6836 earlier. Next, there is support at 0.6729 0.6940 and 0.7004 are the next resistance lines
by OANDA
S&P 500 Daily Chart Analysis For Week of June 16, 2023Technical Analysis and Outlook: The Reignited Rally continues to move forward this week, hitting our target Outer Index Rally 4412 and, by doing so, completing Inner Index Rally 4444. This suggests a couple of trading scenarios: The unconfirmed completion by Trade Selecter, the market severity will pull back to Mean Sup 4365, followed by a solid bounce to retest the developed and confirmed by Trade Selecter Key Res 4425. The second scenario will display Spooz regrouping within the vicinity of developing Key Res and penetrating higher by targeting Outer Index Rally 4480. Trade Selecter will closely monitor any updates and share any valid confirmation with you.  (Please note that there will be no Daily Chart Analysis for the week of June 23. The next update will be on June 30). 
SP:SPX
by TradeSelecter
Central banks navigate the last stretch of the tightening cycleThis week we learnt how vital Central Bank communication is to global financial markets. The trio of central banks – The Federal Reserve (Fed), European Central Bank (ECB) and the Bank of Japan (BOJ) held their respective meetings. Each of the central banks tried to convey how they will navigate monetary policy amidst a slowing economy and avoid a hard landing. China takes small steps to shore up the recovery Even the People’s Bank of China (PBOC) surprised the markets this week, by announcing a cut in the 7-day Open Market Operations (OMO) by 10Bps to 1.9%1 which paved the way for another cut to the one-year medium term lending facility rate by 10Bps to 2.65%2. These recent developments mark a more proactive stance by Chinese policy makers in trying to tackle the Chinese slowdown in activity since the re-opening. Clearly more is needed. Policymakers are soliciting opinions from business leaders and economists on how to revitalise the economy in a number of urgent meetings3. While the Fed and ECB are trying to tame inflation, China has the opposite problem as inflation remains low. Manufacturing remains weak, exports are slowing, and credit growth is cooling. This is why it’s no surprise that the markets are prepping for a broader package of stimulus targeted towards the ailing property sector. A hawkish skip for the Fed The recent flurry of economic reports continues to show the US economy is holding up but losing steam, supporting the Fed’s approach of changing the pace of its policy tightening. The Fed kept the fed funds rate in range of 5-5.25%, by unanimous vote, in line with market expectations after 10 straight hikes dating back to March 2022. The Fed’s dot plot showed the median rate at 5.6% versus 5.1% a month back. In the summary of economic projections, the median unemployment rate forecast was revised lower from 4.5% to 4.1% by the end of 2023 while the core inflation rate was revised higher from 3.6% to 3.9% making the case for more hikes this year. This clearly was a hawkish skip. Fed Chairman Jerome Powell was careful to point out that no decision was made on a July hike, but he did say it is a live meeting, leading the market to increase the probability of a move. What surprised me the most, was that Powell said rate cuts would be a couple of years out which is at odds with the dot plot forecast of 100Bps of cuts in 2024. Senior Economist to WisdomTree Jeremy Siegel believes the Fed is done hiking and that alternative inflation metrics which incorporate real time housing inputs show inflation running at 1.4% instead of 4.1%. This is based on alternative shelter inflation calculations using Case Shiller Housing and Zillow rent annualized at 0.5% instead of the 8% that is biasing Bureau of Labor Statistics (BLS) CPI higher. ECB’s revised inflation forecasts remain at odds After raising the deposit rate by 25Bps to 3.5%, the ECB was a lot clearer than the Fed in signalling that rate hikes are almost certain next month on July 27. The ECB remains too optimistic on growth, reducing their projection for 2023 real GDP to only 0.9% (from 1% in its March projections). While I would agree with the ECB’s view that (1) mostly labour-intensive services will support economic growth over the next two years and (2) the current hump in wage inflation will show up via higher prices for these services, I remain sceptical amidst the global headwinds for manufacturing, and a slower pace of overall growth could keep inflation as high as the ECB now projects. While wages are likely to accelerate slightly above 5% in 2023, they should begin declining to 4% yoy by late 2024. We believe, if core inflation continues to recede in the coming months and the real economy grows at 0.4% in 2023, the ECB will stay put in September after a final move next month. As expected, the ECB confirmed that it will stop to reinvest proceeds from maturing bonds under its standard Asset Purchase Programme (APP) from July onwards. It won’t offer new long term liquidity injections upon the expiry of the €477Bn of a TLTRO III liquidity measure on 28 June 2023. BOJ sits tight As expected, the BOJ kept all key policy settings unchanged, including the +/-50Bps band around the zero% Japanese Government Bond JGB yield target. Since taking the helm in April 2023, BOJ Governor Kazuo Ueda has stressed the high cost of premature tightening as the economy is finally seeing green shoots toward sustainable inflation. In contrast to the ECB, the BoJ's latest assessment and outlook for the economy and inflation were also largely unchanged from their update in the April Outlook Report. The BoJ continues to note "extremely high uncertainties" surrounding economies and financial markets at home and abroad." Japanese equity markets reacted positively to the BOJ’s status quo stance on monetary policy. Looking ahead, the Fed’s potential pivot back to a hawkish mode versus the BOJ’s dovish perseverance could pave the way for further upside for Japanese equities owing to the underlying weakness in the Yen versus the US dollar. Sources 1 Bloomberg on June 13, 2023 2 Bloomberg on June 15, 2023 3 Bloomberg on June 14, 2023
FRED:FEDFUNDS
by aneekaguptaWTE
EUR/USD surges after ECB rate hikeEUR/USD is trading at 1.0948 in Europe, almost unchanged on the day. On Thursday, the euro surged 1.05% in the aftermath of the ECB rate hike. The ECB raised rates by 25 basis points on Thursday, bringing the benchmark rate to 3.50%, the highest level since 2001. The markets were not surprised by the move but ECB President Lagarde's hawkish comments following the rate announcement may have surprised some and the euro responded with massive gains. In her press conference, Lagarde said that barring a material change, it was "very likely" that the ECB would continue raising rates in July. Lagarde dampened any thoughts of a pause, even though the eurozone economy remains fragile and growth is expected to be weak. Headline inflation has been falling sharply in the eurozone, as energy prices have fallen. This is positive news, but the ECB is more concerned about core inflation, which is a better gauge of where inflation is headed. The core rate, which excludes energy prices, has been stickier than expected. Inflation has also cooled due to the ECB's rate tightening, but the current rate of 6.1% is far too high for the central bank, which is likely to hike again in July. The Federal Reserve dramatic decision on Wednesday contained two important aspects. First, the Fed took a breather and held rates after 10 straight rate increases. Second, the Fed signalled that the pause did not indicate the end of the current rate-tightening cycle, as the Fed was projecting two more hikes in the second half of the year. Fed Chair Powell reiterated in his press conference that the inflation battle "has a long way to go" and there is every indication that Powell will keep hammering away with rate hikes until inflation falls to the 2% target. There is resistance at 1.1050 and 1.1147 1.0922 and 1.0854 are providing support
by OANDA
12/06/23 Weekly outlookLast weeks high: $27401.2 Last weeks low: $26363.7 Midpoint: $25326.2 A massive week in the markets this week: Tuesday - US inflation data to be released tomorrow (Inflation rate YoY, MoM and core inflation YoY.) Wednesday - PPI MoM, FED interest decision, FOMC economic projections & FED conference. Thursday - Initial jobless claims & US retail sales All these events happening so closely together signals huge volatility to be expected. This coupled with the SEC news the crypto space is balancing on a knife edge. We've already seen alts bleed extensively but BTC and even ETH have yet to seen similar sell-offs. Perhaps we will see it this week. As it stands price is near last weeks low, with the incoming volatility I think we can safely assume that price will break lower, it's a question of how far below it will go.
by ProR35
$DXY - 'ABC' Waves Completed - The Dollar Index TVC:DXY seems to have completed Wave C of its A-B-C Elliot Waves Correction, today on ECONOMICS:USINTR Fed's announcement. TVC:DXY must hold the lows of Wave C at 102.6 and 1 level of Fibb' Zone, otherwise, its macro downtrend from 114 High will be printing another Bearish Lower High This, however, would be a fantastic opportunity for The Financial Markets to explode more on their uptrend resumptions . TRADE SAFE *** NOTE that this is not Financial Advice ! Please do your own research and consult your Financial Advisor before partaking in any trading activity based solely on this Idea .
TVC:DXY
by Mr_J__fx
Potential DXY Crash: Anticipating a Substantial Drop to $25I'm eyeing a significant decline in the U.S. Dollar Index (DXY) from its current level around 103, down to 25, driven by escalating inflation, competition from Bitcoin and gold, and the influence of BRICS nations. Should this substantial DXY drop materialize, it would likely benefit commodities, emerging markets, export-oriented economies, cryptocurrencies, and gold due to the inverse relationship they share with the dollar's value. The recurrent raising of the debt ceiling exacerbates the country's debt load, potentially weakening trust in the U.S. government's ability to service its debt, which in turn could significantly devalue the dollar. Inflation: If the dollar drops that much, it could lead to inflation or even hyperinflation. The cost of goods and services could rise, which would decrease the purchasing power of the average American. Interest Rates: To combat inflation, the Federal Reserve may increase interest rates. Higher interest rates can make it more expensive to borrow money for things like mortgages or student loans, which could affect the average American's ability to finance major purchases or manage their debts.
TVC:DXYShort
by MichaelBsul
7
Signs for a looming recessionInvestigating the 2008 recession, with specific regards to Interest Rates and Inflation. We can observe a similar pattern occur here. Should history rhyme, we will see at least some more months of bullish price action before the top is set. From there, months of slow decline, before bearish acceleration kicks in - deflation. Correlative projection puts the top in April 2024, however I have reason to believe that it will happen earlier this time, sometime this year. Reason being, is that the dynamic is different. There is a lot more leverage and this isn't about a housing market. The USD is being ditched as world reserve currency. Generally, the price increases that we should see in the coming months, would pale in comparison to the price decreases that we will see later. Invest wisely, and stay safe.
SP:SPXShort
by Alien_Algorithms
AUD/USD rally continues, Fed decision loomsThe Australian dollar continues to gain ground and is trading at 0.6795, up 0.42%. The Aussie has been red-hot in June, gaining 4.4%. Australia releases the May employment report early Thursday. The labour market has stayed solid despite aggressive rate hikes from the central bank, but there may be signs of cracks. In April, Australia shed jobs for the first time in three months, including 27,100 full-time jobs. The RBA won't be able to pause rates for an extended period unless it is convinced that the labour market is cooling down. The economy is expected to have gained 15,000 jobs in May and the unemployment rate is projected to remain at 3.7%. US headline inflation fell to 4.0% in May, down from 4.9% and the lowest level since March 2021. This was positive news, but the decline was driven by a drop in lower food and energy prices. Core CPI, which excludes food and energy, fell from 5.5% to 5.3%, a modest drop. Core CPI at its current level is not compatible with the Fed's 2% target, which will likely mean more rate hikes unless the core rate decelerates at a faster clip. The highlight of the week is the Fed rate decision later today. The markets are widely expecting a pause, which would break the streak of ten straight rate hikes. The rate decision may be a foregone conclusion, but the rate statement and Powell press conference could shed some light on what the Fed has planned next. If the Fed stresses that the current tightening cycle is not over, it could dampen risk sentiment and provide some support to the US dollar. AUD /USD is putting pressure on resistance at 0.6804. Next, there is resistance at 0.6863 0.6729 and 0.6632 are providing support
by OANDA
1
Charts Show Market Expects Fed to Pause but Big Resistance AheadTraders, Over 90% of the market is currently pricing in a FED rate pause tomorrow, but beware, the market often moves towards the point of maximum pain. My charts are showing we are at a critical point of resistance as I type this post. The bulls are going to have to conquer 4,370 and confirm it on the daily to convince me that the they are not out of steam just yet. From my perspective and the way I am reading this chart, is that the market may be in for a bit of a surprise pullback here. The blow-off top that I predicted well over a year ago is still currently underway and, IMO, will continue. But the market never goes to any future price point in a straight line. We are due for a pullback. I am not saying this will occur. I am only suggesting that a bit of caution is still very much warranted for the remainder of this week. Here's a look at a schedule of significant events that have or will yet occur and may cause volatility: Tuesday: • US CPI Data • Hinman Docs Become Public • SEC's Coinbase Rulemaking Response • Binance US Hearing Wednesday: • US PPI Data • FOMC Meeting Thursday: • US Jobless Claims • US Retail Sales Data Take care, Stew
U
by stewdamus
5
GBP/USD rebounds on strong UK job numbers, US inflation dropsThe British pound has pushed higher today, courtesy of a strong employment report. In the North American session, GBP/USD is trading at 1.2592, up 0.64%. The UK labour market remains robust, and today's employment numbers were higher than expected.  The economy created 250,000 jobs, up from 182,000 crushing the consensus of 162,000. The unemployment rate dipped to 3.8%, down from 4.0% and below the consensus of 4.0%. As well, average earnings including bonuses jumped to 6.5%, above 6.1%, which was also the consensus. The hot numbers will be a major disappointment for the Bank of England, which was expecting the labour market to show signs of cooling off after 12 straight rate hikes. The jump in wages may pose the biggest concern for the BoE, as high wage growth is a key driver of inflation, which remains very high at 8.7%.  Governor Bailey testifies today before the House of Lords Economic Affairs Committee, and the committee members are likely to grill Bailey on the latest job data. US inflation has been heading lower and the trend continued today. Headline CPI for May fell from 4.9% to 4.0%, just beating the consensus of 4.1%. The core rate dipped from 5.5% to 5.3%, as expected. The Fed's tightening policy has succeeded in pushing inflation lower, but the question is whether the Fed feels that inflation is dropping fast enough. Today's inflation data has the markets buying all into a pause at Wednesday's Fed meeting. The probability of a pause has soared to 99% according to CME's FedWatch, compared to 75% prior to the inflation release. There are Fed members who favour more rate hikes and the expected non-move on Wednesday could be a "hawkish skip" in which the Fed signals that it is taking a breather but more rate hikes are coming. There is resistance at 1.2657 and 1.2734 1.2513 and 1.2436 are providing support
by OANDA
Natural Gas - Set to Fly High with the Dollar?Weekly Long Position on AMEX:BOIL A new major low was observed in this market on May 30th The security of interest is $NYMEX:NG1!. Using a leveraged product AMEX:BOIL to gain exposure to a potential short-term movement, as a continuation of a long-term trend. See below the chart of $NYMEX:NG1!. Commodities, equities, and other assets priced in US Dollars are subject to relative foreign-exchange changes, as realisation of risk is highly complex in globalised markets. The price of NYMEX:NG1! represents some relationship to an almost infinite supply of financial products, as capital moves around the interconnected world. For example, Iran is not apart of SWIFT and must exchange assets to engage in trade with other nations. Their crude oil is paid for in gold. However the 'zero-risk' benchmark for both these commodity products, NYMEX:CL1! and COMEX:GC1! , are priced in US Dollars. As the relative strength of the US Dollar fluctuates, asset prices too will fluctuate even without alteration to any of the fundamental dynamics of the market in question. Martin Armstrong has established himself the foremost expert on 'Capital Flow Analysis'. See below the chart of COMEX:GC1! , FX:USDCHF , ECONOMICS:USCPI Important to note is the lack of direct correlation between Gold priced in US Dollars, and US Dollar domestic inflation (CPI). Contrary to the assertion of many analysts, gold responds directly to sovereign-related risk. The 'relative-value' of gold at the time of each major high reflects price discovery across all asset classes, though we can only view one time-price continuum on a chart. With that in mind, see below the chart of TVC:DXY and a few commodities. All these markets demonstrate various correlations to one another, there is a general trend that can be observed. As the capital flows persisting from Feb 2022 onwards reflect a shifting global investment outlook, towards high-quality assets. Over the course of the last few financial crises, the safe place for capital was US sovereign debt, in the form of Treasuries. As the plumbing of the two-tier global banking system is operated by the US Federal Reserve, highly liquid money markets keep the USD afloat in times of financial stress. However, this has not always been the case. During the Great Depression, the contraction of capital (deflation) was so severe that physical, paper US Dollars were the global asset of choice for security. Capital formation could continue once the price of gold was un-pegged from the dollar, to properly reflect price discovery in the newly minted global economy. Energy markets have become particularly chaotic over the last 16 months, as Russia plays an important role, particularly in Europe where a network of pipelines has become a security issue. Heavy sanctions have been placed on Russia, as well as an outright ban of a large quantity of its exports. Russia, having control over Ukraine's direct access to the ocean, has returned the favour. Resulting in a disruption in markets from wheat, and lumber, to gold and neon. With the Nordstream projects in critical condition, Europe's energy fragility should be of great concern, both domestically and to its allies. Among the sanctions, is a 'price cap' on the price of crude oil for export at $60/barrel. See chart of NYMEX light crude, and European brent crude. For those not aware, these represent relatively "raw" product exchanged on global markets. Crude must be refined to produce products like gasoline, diesel, lubricants, etc. As with any attempt to artificially manipulate the price of an asset, this presents arbitrage opportunity. Since December when this was imposed, China and India have reportedly been buying Russian crude, refining and exporting it. Russia has spent years purging US Dollar exposure from its energy markets, as war in the Middle East has steadily grown tension between the two powers. Foreign exchange markets are very sensitive to volatility, and can respond unpredictably to major shifts in trend. The consequences of capital moving around the globe quickly can be devastating, see FX_IDC:USDRUB , TVC:US10Y , and TVC:MOVE the US bond market volatility index, compared. All markets must respond to price action, as real risk remains deeply concealed. All while this is going on, global shipping has become significantly more expensive. Meaning the logistical element of global energy markets has become very convoluted. From cheap oil sitting on tankers, to arbitrage of diesel products, to ships transferring oil between one another to conceal Russian oil, to leveraged oil ETFs, the dynamics of NYMEX:CL1! have become almost unfathomably complicated. So to return to NYMEX:NG1! , the value of this product lies in simplicity. The current price can only be assumed to properly reflect global monetary conditions, as a dramatic correction can be observed. The art of business, is buying what nobody wants and selling it when everyone wants it. So much focus in finance at the moment is pointed towards the Federal Reserve and its attempted manipulations of the interest rate on US Dollars. Why this is taking place however, is a subject that has avoided capturing attention. The Federal Reserve is attempting to combat WAR INFLATION by creating deflation domestically, supported by capital flows from abroad. Flight to quality will take place independent of any institutional power, by offering a higher rate of return on Treasuries the Fed is more likely to be able to reduce its balance sheet, and support NATO's war efforts. In order to pay troops, send equipment offshore and make loans to Ukraine, capital must leave the borders of the United States, to the sum of trillions, creating massive inflation globally. So to clarify, global capital is fleeing towards the United States. However, the only sources of capital formation in the United States are financialization, and war. Stagflation, thought to be impossible, has returned to the world. As such, equity and asset prices can continue to rise, without actually rising in relative value globally, since the same will occur in the sum of tanks, aircraft, etc, moved around the world. A zero-sum game. The fact of the matter is that the world is going to need natural gas - and a lot of it at that. The current domestic investment climate can't adequately adjust for this, the dominant psychological trends in markets push capital down paths which are facilitated by political means, for example 'Environmentally Safe Governance'. Exploration of gas reserves and extraction of energy products has become very unpopular in the last decade, to the unfortunate dismay of anyone who hopes to drive car or live in a heated home in the next decade. Of note, that besides the US and Canada the largest producers and exporters of natural gas are apart of, or close to the influence of BRICS. Any global conflict which takes place, will first manifest itself in global financial markets, and there is lengthy historical precedent for this. Europe, which has its gas supplied from abroad is completely exposed to market energy prices, as well as the logistical risk of actually supplying said gas. A precarious position to be in, as war knocks on their door. Immediately after Russia's invasion of Ukraine, the world saw a vision of the future flicker as gasoline prices skyrocketed. Reality as we know it in the industrialised depends on simple global logistics, and cheap energy prices. Both of these constructs are crumbling very quickly, and cannot be resolved until a settlement is made between Ukraine and Russia. Money printing and sanctions cannot make more natural gas appear, nor get it across the ocean cheaply. I propose a trade on AMEX:BOIL , to gain exposure to volatility in Natural Gas markets. Lines of support/resistance represent the arbitrary price points I suggest may be relevant, and can be used for entry/exit and position management.
AMEX:BOILLong
by FPS_Denny