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Reduce inflation rate from 6.5% to 3% this years, says WilliamsFOMC's Williams speech did not do much, as he was echoing what Jerome Powell already said 2 days ago. Rate hikes to resume, but at slower pace. Williams mentioned that inflation rate in the US should cool off to 3% this year, now at 6.5%. That's 50% lower. Question is, how much more rate hike is required to push inflation down by 50%? Will that be somehow somewhat slowdown the US economy as a whole? A whole lot more tightening will need to take place, as I see it. Lending has already begun to tighten and credit is more difficult to obtain due to stricter requirements by banks. Hmm... how will this play out? By Sifu Steve @ XeroAcademy #usdollar #usd #dxy #interestrates #useconomy #federalreserve #FOMC #inflation
TVC:DXY
by XeroAcademy
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
GOLD BULLISH SCENARIOGOLD is described as a safe haven against war, inflation, and banking collapse as we can see on the daily chart. The 2 fat red candles are basically 3 interest rate decisions in two consecutive days which were all hikes. Uptrend support shows signs of resuming the previously steady uptrend. The dovish comments from Powel can be interpreted as neutral, in our case here is support for that trend. Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.
SAXO:XAUUSDLong
by legacyFXofficial
DXY GAME ON!! SPIKE COMING FOR THE DOLLAR?Last week's surprising jobs report sticky inflation, and persistent and frothy financial conditions may force the Federal Reserve members into a more hawkish position, forcing them to keep the heat on interest rates and the money supply. Many market participants were looking for a pause in rate hikes as soon as next month and possibly a pivot to lowering rates shortly after. This new data is going against what the Fed was trying to accomplish in this rate hike cycle, which is to keep inflation within mandated guidelines, and to tame loose financial conditions, dashing the hopes for a pivot in policy anytime soon and pushing that pivot out for far longer than some were expecting. This will put upward pressure on bond yields and a dollar so heavily shorted causing the pivot crowd to close out some of their short positions as the Fed puts the screws to the money supply and inflation. This classic cup and handle setup illustrates the effect the Fed Policy may have on the dollar.
TVC:DXYLong
by Journeyman124
The Pure Short Interest Rate Play: /GEThe long interest rate play may have been one of the most productive plays of, oh, the last five years or so (maybe more) with shorts in (pick your poison) SHY (1-3 year maturity paper), IEF (7-10), TLT (20+), EMB (emerging market), HYG (junk) being the rage, particularly with the Fed giving the market a fairly good idea of the when. Unfortunately, the point at which the Fed starts considering easing is -- at least at this point -- more fuzzy both in terms of timing and the terminal rate at which we end similarly covered in fur. That being said, it's good to be prepared and to look at the who's, what's, when's, and where's of where you might take the purest form of a bet that rates ease from that point forward and that (at least in my little noggin) is with /GE. Pictured here is /GE, where you can see how fabulous the short was from basically ZIRP to where we are today, with the box wrapped around a potential terminal rate of between 5.25% and 5.75%. My basic notion here is to long /GE in some fashion in this area or ultimately where the terminal rate ends up, particularly when the Fed gives us some sense of the "when" of a potential cut. Chairman Powell has indicated a lack of likelihood for a 2023 cut with the CME Fed Watch Tool reflecting that to some minor extent,* but -- as we've seen repeatedly -- the landscape (inflation, unemployment, yada yada) can change, so the terminal rate may end up slightly (or not so slightly) different from current expectations of 500-550 bps and the timing of any eventual cuts slightly (or not so slightly) different from the markets thoughts on the matter. * -- Currently, the Tool indicates that the market is leaning (but somewhat equivocally) toward a small potential cut in June, but is looking more toward the end of the year toward potential cuts at the moment (i.e., at the November and December meetings) which are similarly equivocal.
GLong
by NaughtyPines
GBPJPY Key Support Zone GBPJPY Has retested off the key support zone again to create the end of a triple bottom that we previously saw break out bearish but with last weeks positive news for GBP and the downward trend of the JPY add confluence to the pivot point and we could see prices rise, that being said amidst the gloomy outlook on the undecided interest rates in the UK it would be wise to see how we react after market open going into next week and if we continue bearish to retest the support or break through.
Long
by OfficialKieranTrewick
3
XAUUSD Potential Bearish Trade.The chart for XAUUSD could be a bearish trade given that the Federal Reserve increase interest rates to 25bp, this Federal decision could affect the XAUUSD trade favor to USD side, but according in the Federal report by Jerome Powell, Chairman of Federal Reserve, "that is for Congress to raise the debt ceiling so that the United States government can pay all of its obligations when due," Powell said. "Any deviations from that path would be highly risky. And no one should assume that the Fed can protect the economy from the consequences of failing to act in a timely manner." Powell said. Trader should assets the trading situation before placing a trade. If trend is bearish, the potential price point could be the three Fibonacci Retracement. A possible bearish trend at three Fibonacci Retracement level. 1.(1827.11 at 0.382 Fibonacci Retracement level) 2. (1786.92 at 0.5 Fibonacci Retracement level) 3. (1746.74 at 0.618 Fibonacci Retracement level) Forex Disclaimer. This Published idea is intended to be used and must be used for information purposes only and not for investment advice. It is important to do your own analysis in forex trading before making any investment based on your own personal circumstances. Regardless of anything to the contrary, nothing available on or through this information should be understood as a recommendation that you should not consult with financial professional to your particular information. Forex trading may sustain a total loss greater than the amount you deposited to your account if the forex trading move against to the trader. The said forex is the responsible for all the risk and financial resources and trading system that has been used by the trader.
FX:XAUUSDShort
by wilhelmvine21
EURUSD before FEDToday we await the announcement of interest rates by the FED. This is the most important news right now and is sure to cause movement. Bear in mind that there will be press conferences 30 minutes after the announcement. Yesterday we discussed the buying zone which is already reached and we have a rise. It’s important to see confirmation of this movement after the news. Only then we can enter into new trades. If we see new rise, the first target will be 1,1000. In case of a clear movement we will be looking for further targets.
by ForexTrendline
6
My thoughts for this week 31 January 2023US This week will be a fairly exciting to monitor as Interest Rate announcement and Non-Farm Payroll data will be release. Two heavy hitting news that is very key to understanding further trends in the markets, especially on DXY. Through entire January 2023, DXY is consolidating steadily and holding ground around 101.500 area. Could this week’s high impact news finally get DXY out of consolidation? We shall see. However, we know that Federal Reserve will be raising rates again by 25 basis points, which mainstream news outlets seem to be mentioning. With this data, theoretically, if rates go up, it is bullish for the currency and vice versa. Another thing to consider is that, Japan and China are still dumping US Treasuries/Bonds and many other countries are attempting to de-dollarize. Further add to the fuel is US’s national debt ceiling that has been breached last week. These 2 scenarios are very bad for the US economy. How much of bullishness will 25 basis point increase bring about? So far, from the last two, Federal Fund Rate announcement (Nov & Dec 2022), we see that DXY declined even with 50 basis points hike. Could history repeat again? Perhaps DXY can reclaim 102.500 – 103.000 but I do not think whole-heartedly that it will give 105.000 a go. China With China’s re-opening, there is definitely positivity circling the global markets. China’s GDP growth was reported up by 3% for the year 2022, higher than expected rate of 2.8% but yet still fell short of March’s target of 5.5%. The sign of growth, though little, is still a sign of improvement. Considering after months’ long Zero Covid policy and geopolitical tension with the West, problematic real estate sector, this slight improvement definitely have greater volume to it than just the number. We cannot take our eyes away from the long term end goal of China, which is to be the next reserve currency of the world. Collaboration with some powerful nations e.g. Saudi Arabia, Brazil, South Africa, Indonesia, India etc via BRICS+ bloc, brings Xi Jin Ping’s path to dominance one step closer day by day. Recently, Saudi Arabia also made public about their consideration of non-US Dollar for Oil trade. Gold continues to be horded by China, as well as Russia and major central banks of the world, just goes to prove the level skepticism towards the greenback. Just my thoughts. Trader Sifu Steve @ XeroAcademy Malaysia
TVC:DXY
by XeroAcademy
VIX long, but how long?VIX price movement is clearly narrowing from a charting technical view, but within the economic fundamentals we have the FED raising rates at an extremely fast pace into a slowdown. Their publicly stated inflation projection was clearly wrong, I highly doubt they will squash inflation with much accuracy given these blunt force tools. For this reason the VIX could go well beyond the 35-40 range if the FED over raised rates. Since Powell was guessing on inflation after injecting more money into the system than ever before(no data to support obviously), it’s fair to assume there is no data to support the current pace and magnitude of raises in this slowing environment. If the current pace is perfect(again no data it would be almost lucky) then the VIX could fall from 35. My base case is the VIX goes over 40 and the FED cuts rates to fix their second mess later this year.
TVC:VIXLong
by bgreer009
6
💵THE WORLD IN DEBT💵 ☑️The fact that the whole world is in massive Debt that can not be repaid is a buzzphrase that was around for like 20 years already. 20 years passed and nothing bad has happened, so what to worry about? In fact an entire political and economic movement called MMT or a modern monetary theory emerged claiming that government debt does not matter and that we can, you guessed it, print as much as we need(kinda) ☑️But the size of the debt itself was never really and issue so long as the government or a big company could service the debts. That is if their cashflow was positive enough to cover the interest payments on the debt. Now however, as the FED is raising rates, this is an issue. ☑️And its not the USA who’s pile of debt we need to be worried about(they are borrowing in the currency they can print themselves, remember?) but rather the rest of the world and the companies. The majority of developing countries don’t have the internal capital required for development, so they need to borrow on the international financial markets in Dollars. And these counties are now facing a perfect storm of a higher cost of new borrowings in Dollars, lower revenues from foreign trade due to recession(and yes we are in a recession, Wake up) and the massive energy and food costs due to the war in Ukraine and the problems caused by the supply chain crisis. ☑️Most big public companies aren’t doing great either. The share of listed companies with the debt servicing costs higher than the profits is now more than 25% and if we exclude the accounting and financial engineering shenanigans, it is save to say that this share is close to 30%. ☑️So the third of the economy is outright insolvent. Multiple countries will either default soon or will at least be plunge into civil and economic unrest and go the way of Sri-Lanka, Pakistan and others… And Jerome Powell said that he aint stopping and that the Fed funds rate should go up by at least 2 percentage points more. So instead of the collapse of the USA, we are likely to see a chain reaction debt crisis In the rest of the world unless the FED changes its mind… I Hope you guys learned something new today✅ Wish you all Best Of Luck👍 😇And may the odds be always in your favor😇 Do you like this post? Do you want more articles like that?
Education
by ProSignalsFx
7
DAX vx SP500: Is DAX highly over valued?By comparing the charts of US indexes vs European indexes we usuallly find pretty much the same patterns. However there is something that really caught my attention, compare the monthly chart of sp500 vs Dax: DAX is only 6,54% from all time highs of 2022 SP500 is 15,40% from its all time highs of 2022. NASDAQ is 28,45% from it's all time highs of 2022 This difference is obviously linked to the different policies of central banks, however I wonder if such a huge difference is justified. German economy has been highly struck by energy prices and German inflation is still 8,5% vs 6,5% in the US.
EUREX:FDXM1!
by SBtrader82
3M Co. (MMM) bearish scenario:The technical figure Triangle can be found in the daily chart of the US company 3M Co. (MMM). 3M (originally the Minnesota Mining and Manufacturing Company) is an American multinational conglomerate operating in the fields of industry, worker safety, U.S. health care, and consumer goods. The company produces over 60,000 products under several brands, including adhesives, abrasives, laminates, passive fire protection, personal protective equipment, window films, paint protection films, dental and orthodontic products, electrical and electronic connecting and insulating materials, medical products, car-care products, electronic circuits, healthcare software and optical films. The Triangle broke through the support line on 20/01/2023. If the price holds below this level, you can have a possible bearish price movement with a forecast for the next 22 days towards 108.57 USD. Your stop-loss order, according to experts, should be placed at 129.63 USD if you decide to enter this position. Wall Street will be looking for positivity from 3M as it approaches its next earnings report date. This is expected to be January 24, 2023. On that day, 3M is projected to report earnings of $2.34 per share, which would represent year-over-year growth of 1.3%. Meanwhile, our latest consensus estimate is calling for revenue of $8.04 billion, down 6.69% from the prior-year quarter. Risk Disclosure: Trading Foreign Exchange (Forex) and Contracts of Difference (CFD's) carries a high level of risk. By registering and signing up, any client affirms their understanding of their own personal accountability for all transactions performed within their account and recognizes the risks associated with trading on such markets and on such sites. Furthermore, one understands that the company carries zero influence over transactions, markets, and trading signals, therefore, cannot be held liable nor guarantee any profits or losses.
NYSE:MMMShort
by legacyFXofficial
2