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Kovach

Expectations for September's FOMCWhat do the markets care about this week? We have another CPI print on Wednesday, which is highly anticipated. We are in a period of nasty stagflation and the Fed is caught in a difficult position. They want to raise rates further, but the issue is that our cause of inflation seems to be on the supply chain side. Interest rates will do little to combat this. The NFP numbers Friday were pretty strong, so their case is strengthened to raise by at least 50bps in September, at the next FOMC. It will be almost a certainty if CPI comes in hot. Note that GDP came in contractionary for two quarters in a row, which is the definition most use for a recession. This stands somewhat at odds with the strong NFP numbers, which could be a seasonal fluke. If the data continues to indicate that we are in a recession, the Fed will eventually be forced to lower rates again. The markets seem to be weighing this reality before rallying with conviction.
FRED:FEDFUNDSLong
by quantguy
2
Litecoin Retraces from Our TargetLitecoin has come just shy of hitting our next target at $64.37, retracing sharply after rejecting this level. Resistance was confirmed by a red triangle on the KRI, then we promptly retraced back to support at $61.75. We are currently seeing support from this level. If things go south, we could break through to the vacuum zone below. The next support level after that is $55.84. If momentum picks up, we could test $64.37 again, then $66.94 is the next target.
BITSTAMP:LTCUSDShort
by quantguy
Ethereum Loses Steam Below $1800Ethereum made a notable run for highs, coming just shy of our target at $1821. We made it to $1790 or so, and were not able to test the $1800's just yet. However, we were able to break past that dense patch of levels in the $1700's, which started at $1653. We are currently finding support at the last of these levels, at $1748. If we see more momentum, we could easily hit our target of $1821. If not, then several levels in the mid $1700's should provide support including $1748, $1717, then $1694. The last level of support is at $1653, which we expect to hold as a floor for now.
BITSTAMP:ETHUSDShort
by quantguy
Gold Gearing Up for a Breakout?Gold is testing the low 1800's, breaking past 1800, but just barely. We are currently sitting at 1805 at the time of this writing. We appear to be forming a bull wedge pattern, potentially gearing up for a breakout. The Kovach OBV is still bullish, potentially indicating a bull divergence. If we are able to break out, then the next target is 1815, then 1826, then 1836, which coincides with the .786 Fibonacci level. If we retrace, we should have strong support around 1780, the 50% Fibonacci level.
COMEX:GC1!Long
by quantguy
Ethereum Testing Highs... Can it Break Out??Ethereum has broken through a cluster of resistance levels in the $1700's. Just a few days prior, we were having issues with $1653, the first of these levels, but have managed to punch through resistance over the weekend. We are currently contending with the last level at $1748. Though we have broken through (currently in the $1760's at the time of this writing), we are seeing heavy resistance confirmed by a red triangle on the KRI. Current levels align with previous highs in Ethereum, established in late July. If we are able to clear them, the next target is $1821, a significant milestone for ETH. If we fail to break out, then expect support in the high $1700's, with $1653 a likely lower bound for now.
BITSTAMP:ETHUSDShort
by quantguy
Bitcoin Hits $24K! What's Next?Bitcoin got a strong burst of momentum, taking us to the next target of $23.9K. Currently, we have broken just past that level and are testing $24K. We are seeing genuine momentum come through and the Kovach OBV has picked up to confirm it. We are on the precipice of the vacuum zone to $25.1K, which is our next target. If things turn south, then we could retrace back to $22.4K. After that, we would return to the previous value area Bitcoin held between $20.7K and $22.4K.
BITSTAMP:BTCUSDShort
by quantguy
Bull Wedge In Stocks?Stocks are tending toward the upper bound of the value area, forming what appears to be a bull wedge. We have been flirting with higher levels in the 4000's established from a value area formed back in June. We seem to have a hard upper bound at 4178, but the Kovach OBV is still strong, suggesting that we have a bull divergence. If we break out, then 4188 will provide resistance. If we can break through that, then 4214 is the next target. We should have support from 4122, then there is a vacuum zone to 4068. If that does not hold, we should have strong support at 4009.
FX:SPX500Long
by quantguy
2
Ethereum Tests Higher LevelsEthereum pumped and broke into the cluster of levels we have been discussing all week. These levels have given ETH a lot of troubles lately, and we just can't seem to break past them to hit our next target of $1821. Yesterday, we saw a lot of resistance from $1653, the where the cluster starts. A few days ago, we rejected $1748, the last level in this zone of resistance. Currently we are contending with some levels in between, with a red triangle on the KRI confirming the resistance. It is unlikely we will be able to break $1748, but if we do our next target is $1821. Watch for support at $1653 or $1547.
BITSTAMP:ETHUSDShort
by quantguy
3
Bitcoin Holds the RangeBitcoin is holding the range between $22.4K and $23.9K. We are slowly edging toward the lower bound of this range. The NFP employment numbers today may not help things for crypto because there is a strong likelihood that the Fed will raise rates further, by at least 50bps at their meeting in September. Also the strength in the dollar suggests that investors are sitting heavy in cash for a while. Curb your enthusiasm for a strong crypto pump any time soon. Watch for support at $22.4K. If we break that, we should see further support at $20K.
BITSTAMP:BTCUSDShort
by quantguy
2
Dollar Strengthens on NFP DataThe US dollar has gained incredible strength off of the Non Farm Payroll numbers, which came at a headline beat with employment at 3.5%. This suggests that the markets feel that the Fed is now more emboldened to hike rates even further at their September meeting. The DXY is still holding the range established when it started its sideways corrective phase after the pull back from the low 109's. We dipped down into the 105's, and subsequently pivoted back to the 106's, with 107.20 still an upper bound. If we retrace this rally, then expect support at 106.13 or the 105's.
TVC:DXYLong
by quantguy
Oil Presses LowerOil has fallen deeper into the high $80's following a selloff that broke monthly lows. We had very strong support at $92.03, and appeared to be seeing a double bottom forming, but the selloff knocked oil back a peg, smashing through multiple technical levels below in a persistence selloff that has taken us back to support at $87.21. We are seeing a green triangle forming on the KRI, but the selloff does seem persistent. We should have further support from $85.55 and $84.75. If we see a relief rally, the $90's should provide resistance.
NYMEX:CL1!Short
by quantguy
What Today's Employment Data Means for Stocks and the FedNon Farm Payrolls introduced some volatility in stocks. The numbers came in hot, with a headline beat and unemployment at 3.5% . The S&P 500 had already edged higher, reaching our target of 4178, and establishing value between 4144 and 4178. The NFP data release introduced some volatility, with a small selloff extending past 4122 into the vacuum zone down to 4068. It appears the figures were priced in already, and stocks may be correcting because of that. Also, the strong numbers give the Fed more justification to hike rates in September. If stocks fall further watch for support at 4068, but be mindful of the vacuum zone below to 4009.
FX:SPX500Short
by quantguy
Gold RetracesGold edged higher, breaking out of the 0.618 Fibonacci level at about $1800. However, we encountered resistance at the next technical level above, at $1815. Immediately, we saw the price action round off and retrace back to safety in the $1790's. We anticipate gold to establish value between $1780 and $1800 (two significant Fibonacci levels), unless more momentum can come through and help solidify the $1800's. The Kovach OBV is wavering, which suggests we do not quite have enough momentum yet to sustain a breakout.
COMEX:GC1!Short
by quantguy
Employment Data Hammers BondsBonds crept up but are facing resistance. After ZN tested highs at 121'28, and retraced, it started to establish value between 119'23 and 121'00. The latter has provided prohibitive resistance, as we have discussed this week, and we have seen a rejection, continuing the sideways correction. We saw a wick down to 119'23, where we found support, at first, but we subsequently broke through to the vacuum zone below. This follows Non Farm Payrolls coming in at a surprise beat, with unemployment at 3.5%. Expect support at 119'01.
CBOT:ZN1!Short
by quantguy
Ethereum Runs Into ResistanceEthereum found support at $1547, and pivoted up to higher levels. There is a dense cluster of levels starting at $1653, and extending to the mid $1700's. We are currently contending with the first of these levels, unable to break higher. We are seeing many red triangles on the KRI, confirming the resistance. The Kovach OBV has leveled off, suggesting that we need more momentum before we can break higher. If we reject current levels, then $1547 should continue to provide support, otherwise the next level is $1424.
BITSTAMP:ETHUSDShort
by quantguy
1
The S&P 500 Edges HigherThe S&P 500 has broken higher, barely edging past 4144, our previous high. We are curently just below the next level at 4178. We are starting to run into resistance here from previous highs in mid June, confirmed by red triangles on the KRI. If we can break out further, we must get past 4188 before we can consider the next level at 4214. The breakout looks labored and the KRI is relatively flat, so there is a high probability of a retracement, unless we see strong momentum at open. If so, watch for 4068 to provide support, but beware of the vacuum zone below to 4009.
FX:SPX500Short
by quantguy