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Recession

A Pause on Consumerism Christmas Personal Savings are at a historic low, Consumer Credit at highs, and Inflation hasn't popped. The United Kingdom and other leading Eurozone parties have proclaimed their Recession, as the Federal Reserve, BEA, and Executive Branch fight against Wall Street Banks, Wall Street Megacompanies, and basic economic equations contradict each other regarding the US's. Q3 GDP came in positive due to a massive decline in imports caused by overstocking through the first half of the year as every company listened to Jerome Powell and bought inventory. Inventory that is now looking to start hitting sales prices on the back of continued consumer weakness starting hardcore in September, a massive deflation in shipping costs, some energy costs, and a big tick down in demand. Still, the money isn't there for American consumers amid high usage of credit cards in the environment of an ever-inflating cost of living. This analyst believes the most likely outcome is a continued destruction of consumerism, feeling especially heavy on the back of a great Q4 Holiday season in 2020 and 2021 - bigly in thanks to monetary inflation. Lower wage workers have been struggling through the regular life costs amid continuously weak consumer and manufacturing surveys, even with a massive surge in domestic manufacturing construction. Mid-line income earners are in an environment of increasing recession expectations as big Tech are reducing numbers. And while the BLS stick to claims that there are two jobs for every one person looking for work, the underlying environment dispels this illusion. Failed banks aren't the only ones firing workers. Twitter was among the most successful social media companies and hasn't made a profit in history. Amazon's Alexa is being touted as one of the biggest tech failures in modern history, with 10k workers set to bite the dust on the first go from a company that has become the quickest to lose $1 Trillion in Market Cap. The rest of the tech industry is sitting in their own layoffs in the early days of a recession that not all can agree on. The increased probability of a weak Holiday sales period carries increased chances of continued layoffs from core business units and non-core. Amazon's Alexa might be one of the most unprofitable elements of a business that is now looking at dramatically reduced online-consumer spend after a year of reducing warehouse space and inventory while Unionization boomed. Google has shut down most of it's "Moonshot"/incubator projects along with peers, meaning they aren't seeing the Profit in business ventures they don't already master, hinting at a bad look for the space. Congruent to the destruction of the active economy, Stock market valuation deterioration hits at savings and spending now-on. Mortgage rates doubling stresses an already-dubious common ability to buy, thus reducing an already thin depth of bid. I believe we will continue to see degrading macroeconomic environments with a mix of good and bad news for the future as various international economies start to rotate through the current trends and into their future. A mix of extreme pessimism and optimism as the loudest Bulls and Bears continue screaming before the Holiday season, volatility will continue to be high. With a higher skew towards downward pressure, expect some strong similarities and contrasts to last year. The New Year Bump and Drag will likely be a big repeat, with potentially compounded effects. From a socio-psychological stance, I believe the consumer environment is primed for less push on fancy gifts as the narrative grows on Corporate Profit Greed being the greatest pusher of inflation - which is correct in the context that the Federal Reserve and an out-of-depth Government enabled and allowed it. Disclaimer 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 mind, 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.
AMEX:SPYShort
by DoctorFaustus
5
A look at $SPYHere is a look at $SPY since the beginning of this year. It looks to me like were in the last leg of this rally, about to finish w5 right at the months long DTL, as we approach a bunch typical w5 fib levels, the A=C 1:1 extension of the oct 13-nov 1 swing, and the 200 MA. The daily RSI is also approaching overbought territory. If we get a rejection at the 410-415 level, i expect we'll start another months long trek down to the low 300's, probably somewhere around 320-340. 323 is the 50% retracement of the entire post covid rally and 320 is a 100% retracement from the sept 2020 low. Some long dated 400 or 410 puts may pay out really well if bought above 400. A mistake i've made in the past is jumping in too early, so it would be wise to wait for a confirmation of rejection before going hamtaro. Counterpoint If we can break past this year long DTL, the equation obviously changes. If we somehow cross 430 convincingly, i would become a lot more bullish on SPY.
AMEX:SPYShort
by ir-rizzle
3
This was just the start. XAUUSD could hit 950When i look at 12-month chart and use stochastic. I see pretty nicely formed bearish divergence. XAUUSD could hit 1381 or even worst 950. So, I'd recommend you to sell literally every securities that you hold because probably 2 years later could even worst than today. Gold is considered as a safe-haven assets, but if this assets is going down it means financial and economic world could easily collapse. It means lord R want to take his profits, so hopefully you understand what i mean. I predicted by the end of 2022 or around early 2023 (in feb or mar), the collapse will begin. This santa claus rally would not as happy as in 2019. There will be so much pain, much more business collapsing, and unemployment rate will rise. To overcome this i suggest to all of you who see this post idea, as an opportunity to shorting gold and avoid long term long position until mid of 2024 or at least when the stochastic is reversed in a long position again. I remember when Michael Burry told his twitter follower that there is bubble in everything, then i immediately look at the chart and his insight was completely correct, everything is starting to reverse. And months ago, it did happens. I also remember that JP Morgan said billionaire use astrology to trade..i mean who tf this billionaire if he himself wasn't even a billionaire? I have a solid proof that it was lord R. So because of that, i use that astrology understanding to predict when the market reverse and the use of Fibonacci to know where the price will stop. Cheers, H. Haidar
OANDA:XAUUSDShort
by sigmaCEO
BTC SHORT 16K BY ELECTION TIME NOV.2022THE SELL IS IN. We cannot get a solid close over 24.6k to push for a 30k test which alludes me to a dive down to the impulse at 15-17K. The interest rate hikes in the past 6 months have just been another driver in KILLING the price of BTC and majority of cryptos. The banks are broke and are liquidating their initial positions for a possible lower buy in. The US gov is also looking for crypto regulation which would further dampen the price as this is not what crypto was created for. They will speak towards this in the NOV elections as well. The US GOV wants to us USDC/ USDT We tested 20K today 9/27/22 but it could not hold over. BTC wants low LOW. It is in the bottom depths of consolidation towards a cheaper price. 19K flat is a safe buy in zone but you can look for a high 19.5K test to enter. This will not be a fluid drop but a choppy drop. Anything lower than 16K = 12K SOS SL: 20.1K TP: 16K RR: 1:2.5
GEMINI:BTCUSDShort
by chestephens1
2
NIFTY50 SMALL CORRECTION AHEAD!!US recession over(analysis in link section). MANY FII BUYING AND DII SELLING ARE COMING IN THE MARKET!! In previous days, markets where net rising only, but still we could see a lot of selling, from DII side. many FII are steping in. and due to gap ups, the markets are closing in positives. we could see the M AND W pattern are completed, anf there could now be a small correction since, RSI indicator is also in overbought zone. paths are drawn, and then we could again see a rise in markets during end week of this month. if you want to take some new positions in market, do wait for the market to go a little below, then start entering in the markets.
NSE:NIFTYShort
by raghavchoudhary2016
Catalysts for The Global Financial Crisis 2.0The current level of euphoria and speculation on Wall Street is likely to go down in history in the same way that the misplaced optimism of speculators in 1929 was immortalized by the tremendous crash and ensuing depression. The current dynamics at play are more similar to that period than most realize. Many potential catalysts for the Global Financial Crisis 2.0 are beginning to rear their heads, including things such as: -The auto loan bubble -The residential & commercial real estate bubble -The private equity and venture capital bubble -The largest losses in the total bond market in generations -Highest level of Federal Debt to GDP in US history and extremely high level of consumer & corporate debt in US history -The most overvalued market based on forward earnings in history (Based on my expectations of S&P 2023 earnings will fall below 140). Peak margins above -13% coming back under 10% will also help to drive this. -The fastest pace of interest rate hikes since Paul Volcker and $90 billion of quantitative tightening per month. -The crypto bubble implosion where many exchanges are likely to fail due to their ponzi-like staking dynamics and unprofitable nature of exchanges like Coinbase. We are starting to see the beginnings of the financial contagion from FTX into other exchanges and coins. This is happening in an industry valued at over $3 trillion at its peak. -The Chinese real estate crisis and recession -The energy crisis which has curtailed over 20% of EU industrial capacity and is sending Europe into a recession. This is leading to increased energy costs around the world. -Looming sovereign debt crises & currency crises for many emerging and certain developed economies. The $1.6 trillion auto loan bubble is reminiscent of the subprime lending bubble. There were incredibly loose lending standards in this auto loan bubble, where people that received federal stimulus checks were able to claim these as income. This entitled them to larger sized loans than they would have otherwise had access too. Many of these loans were made at over 130% loan to value ratio. These loans have been packaged up as bonds and sold off to investors hungry in search for yield in a world of artificially low interest rates, suppressed by the Fed for the better part of 14 years since the Global Financial Crisis. The amount of delinquent auto loans has continued to increase, and the looming crisis represents a huge threat to financial stability. As real wages and employment continue to fall, the amount of delinquent loans will continue to rise. Earnings for the S&P 500 in Q3 have already started to contract more than 5% year over year (excluding energy) and yet many analysts still expect some, to no growth of earnings in 2023. Earnings are likely to collapse over 40% in 2023, pressured by falling consumer demand and falling operating margins. Consumer sentiment registered the worst sentiment among US consumers since the great depression. All of the Fed manufacturing and service data components show comparable data now to data being released in mid 2008 to the spring of 2009, all with continuously negative trends. Capital expenditures have begun decreasing and mass layoffs are just beginning. 37% of US small businesses could not pay their rent in full in October. Many companies will be forced to close their doors permanently and layoff their entire staff. Consumption began to fall rapidly after the Fed began quantitative tightening and ended quantitative easing. The effects finally began hitting company earnings largely in Q3, with much more pain to follow. Meanwhile, many companies continued to hire large amounts of people unaware that consumption would continue to collapse. As asset prices fall further and inflation stays elevated, real wages will continue falling. Student loan payments begin again at the start of 2023, further harming consumer sentiment. Money supply growth began stagnating early in the year in 1929 and the federal government began to tighten spending with the New Deal programs in 1936 before the crash happened in 1937. Bank balance sheets have been flat for 2022 while the central bank balance sheet has been contracting leading to a slight contraction in the money supply. The contracting growth of monetary supply and fast paced increases in interest rates will lead to a large-scale downturn in GDP. On a technical basis, the current market setup looks very similar to 1929, 1937, 1973-1974, 1987, and 2008. All of which had major rallies that topped in late summer / fall before crashing over 30%. All of these crashes took place over the span of less than 3 months, with the majority of the percentage decline occurring over a period of 2-3 weeks. There are dozens of companies that are virtually guaranteed to go bust in this downturn based on an overview of their financials. There have never been so many listed companies that reached valuations in the billions at their peak with no earnings. Many companies at the time of this writing still have valuations of over 6 times sales and many companies such as Coinbase, Uber, and Rivian are still valued at over $10 billion market caps whilst losing hundreds of millions of dollars per quarter. The dozens of zombie companies in the S&P 500 are being forced into rolling their debts at higher interest rates while their earnings fall. This will be the largest debt deleveraging cycle in the US economy since the great depression, because this is the largest accumulation of bad debts since the roaring twenties. It is not long until the credit risk is truly realized by market participants, and interest rates spike throughout the economy. This would include the inter-bank lending rate and junk rated bonds which would lead to a financial crisis. The longer the Fed’s quantitative tightening runs, the more inevitable the financial crisis becomes. The Fed ran the balance sheet down around $600 billion over the course of 2018 into late summer of 2019 before inter-bank lending rates started to spike. This time, the Fed has run the balance sheet down close to $300 billion so far with a plan of reaching over a $600 billion runoff in Q1 of 2023. The hopes for a Fed pivot are misplaced. A Fed pivot on interest rate hikes and even a reversal of the rate hikes cannot re-incentivize people to borrow. When you’re in a contracting credit cycle and business cycle downturn, debt begins to be paid off and defaulted on rather than excessively accumulated. The demand to borrow collapses even if interest rates were lowered by the Fed. Therefore, bear markets and recessions usually don’t end until many months after the Fed has already begun cutting interest rates. This was seen in the Great Recession and the dot com bubble of 2000; where the market didn’t bottom until over 18 months after the Fed began cutting rates.
SP:SPXShort
by Alexander_C_Lambert
2
GDP is Bad and You Should Feel BadThe GDP number of 2.7% growth is being propped up by net exports, while consumption is at a cycle low. This is horrible for earnings expectations and risk assets. Net exports were at a low in prior quarters, making the economy look worse off than it was. Now the economy is actually worse off than it is and the metric is instead making it look better. This is why the NBER doesn't use "two quarters of negative GDP" to date recessions. There are too many false signals. Don't fall for the GDP meme. The pain is coming.
FRED:GDPC1Short
by coinhoIio
Cyclical Apocalypse 2023The recession we predicted in August is almost here. Prepare for monetary meltdown. Things to look forward to next year: Mass layoffs (started in q4) and spike in unemployment rate Retail earnings miss heavily with a bad holiday season Industrial production drops sharply Used car bubble pops Mass consumer defaults on car loans Housing market collapse Credit spread blowout Zombie companies reduced to rubble Mass bankruptcies Negative real growth in all four macro sectors (income, production, consumption, employment, etc) Various crypto exchanges insolvent Mass panic and bank runs SPY -30% to -70% drop Disinflation and then deflation (not stagflation) Energy bear market Corporate rates turn into junk Municipal bond meltdown Emergency fed pivot but only after something dire breaks Massive bond rally (tail end)
SP:SPXShort
by coinhoIio
4
FTX is Just Another Market Correction: Liquidity and RegulationsI'm sure you've probably already heard the news about FTX so I won't cover everything - but there's a few things we might expect, longer-term, from the scandal this week. - More Regulations: This incident embarrassed a lot of powerful people as well, so the likelihood of more substantial regulations coming down the pipe is now much higher. - Increased Liquidity: Lots of people are pulling money outside of crypto right now, which explains why the prices have dropped so much this week, as a whole. (Especially Solana, which took an outsized hit compared to the rest.) But the money is still there - some will leave, but some will come back...hopefully with better research. It may present an opportunity for smaller alts to grow after the dust settles. The crypto ecosystem has gone through a few exchange collapses already (ex. Mt. Gox) so crypto itself will still continue to press on. But I fully expect for more stories like these to unfold as we head further into the recession - the money printer has run out of ink, after all.
Long
by RyanTanaka
6
Oil move pending China's directionBrent Crude Oil price is expected to consolidate between 93 to 100, with the main catalyst being China's Covid Policy. There were on-and-off hopes of China's reopening. However, we are still very much on the fence given the continued strict Covid measures in China. On the other hand, China did announce an easing of the measures, reducing the quarantine time. Another positive news is that the NHC is planning to accelerate vaccinations, which is crucial before further easing on their zero COVID policy. We don't know how long that will take, or when it will be in effect. Buys on support above 93 and sells on resistance at 100, until we have a clear path on China's reopening. Overall, looking more for buys given the pretty much firm demand in oil. Keep an eye out for OPEC oil report on Monday, 14 Nov 2022.
OANDA:BCOUSDLong
by geneAnalytics
I will not fall as long as there is the specter of recession.The pandemic caused the dollar to strengthen, despite very low interest rates. There was a moment when it weakened, and that was at the very beginning, until January 2021. After that, it consolidated until June, and then only went up. Why did the USD strengthen, even when rates were around 0%? The crisis has the effect of strengthening the dollar, since all international payments and settlements are made in this currency. In addition, most of the loans that countries take out come from the US. In other words: the demand for the USD was so high that some people began to wonder in 2021 whether there would be a shortage of this currency... For this reason, the FED could 'printed' $9-13 trillion, and the price went up anyway. Something ends, something begins. To make matters worse for all the countries that are borrowing massively in USD in chaos, the FED in March 2022 decided, to start raising interest rates, because inflation in the US started to go up. Of course, the topic of inflation is thicker than just the massive printing. In 2022, Russia attacked Ukraine in February, starting a war that continues to this day. Conflicts are liked by oil, which soared to nearly $130 a barrel. This pushed up fuel prices, followed by the prices of almost every product in stores. By February, the world had forgotten about the pandemic. Late 70s and early 80s. The whole situation is very similar to the late 1970s, when the Iranian Revolution was taking place, which created turmoil in the oil market. American oil then reached almost $40 a barrel. At that time, thanks to this situation and the Iran-Iraq war and the First Gulf War in the 1990s, the Soviets became the world's No. 1 oil producer. All this caused inflation in 1980 in the U.S. to be close to 15%, and interest rates were raised to 20%. Oil a bigger problem than 'printing'. The prolonged conflict in Ukraine, sanctions on Russia, the still destabilized Middle East - protests in Iran, the Taliban in Afghanistan - and OPEC trying to cut oil production daily to drive the price above $100 a barrel... There are so many arguments for oil to rise in the medium term, and only the US fighting it actively by putting its reserves on the market. This could be the main reason for double-digit inflation and high interest rates in the US. Fed against the wall. High rates and low inflation is a better short-term solution than too low rates and stagflation/high inflation. And yet, voices are breaking through to stop raising interest rates because it threatens recession - and it will, no matter how they want to defend themselves - and stop demand. But after all, that's the point; people are supposed to stop consuming maniacally and take out consumer loans to lower demand and help fight inflation faster. I believe the Fed, headed by Powell, are aware of this which is why they will not let up until inflation reaches 2%. Long-term calm. When Inflation starts to fall significantly, the FED will start cutting rates, and that's because Powell is looking hard at the 1980s crisis and Paul Volcker's conduct. One scenario I am considering is: RECESSION → Inflation starts to fall → Rate cuts → 2024-2025 economies get back on their feet and a new bull market begins. This is my long-term view. I wouldn't expect a big weakening of the USD during this time, as it will be supported by high interest rates, still strong demand and when inflation starts to fall, it will also support the currency. I would expect a weakening right after the recession ends. This was the case with the recessions of the 1980s, 2000 and 2007. An uncertain, short-term future. Currently, I don't know what to expect from inflation in the US - the next CPI reading on November 10. If it starts to fall now, it will increase the probability for the Fed to raise interest rates in December by 50 basic points rather than 75 basic points. The USD will weaken temporarily, but it will be hindered by oil, which is getting closer to $100 a barrel every day, and if it exceeds that level, the next CPI readings could be higher. Scenarios. November 10: Inflation down → USD INDEX down → US Indices (SP, NQ, DJ, etc.) up → Precious metals up. Verification at next reading in December. Inflation maintained or up → USD INDEX up → US Indices down (Sell Off) → Precious Metals down. At this point, technically, the short-term USD INDEX is giving a signal for a decline, but a very weak one, so I am not set in either direction and take each scenario with equal probability. Possible scenarios for the coming weeks, but I know that there are still levels below (102) that could be affected if inflation falls now. P.S.. Unemployment has started to rise in the US, which is the first sign that raising interest rates is starting to work.
TVC:DXYLong
by Manticore_Investments
SPX500 Bulls in the gameLooks like S&P500 bulls, but expect that it will only go so far. Unemployment rate has gone up 2%. NFP higher than expected but lower than previous. But, inflation still on the rise. Fed is poised to hold their stand, continue hiking interest rates albeit at a slower pace. Interest rates hikes are possibly priced in by now - with the Fed having made a clear stance for interest rate to be within the range of 4-5%. We have just hit the lower end of the range at 4%, and will probably be little to low impact from now for anything under 5%. Expect chaos if interest rates go above 5%. If otherwise, market will probably continue the bulls until a new catalyst hits. Will we see a correction to key price levels before resuming the higher timeframe trend?
OANDA:SPX500USD
by geneAnalytics
Crypto winter/bull market isn’t overStop saying we are bullish even bottomed. We are still in a bear market and crypto winter isn’t over yet so don’t get way too far ahead. As the retracement to 21K completed should expect a big fall and the bears are back from water break, as bitcoin still volatile and the Feds are still going aggressive to fight off the inflation. Powell gave a hint will go lower but that’s not all, the inflation still over 40 year high.. the next Feds meeting is coming this week for the rate increase decision and the last meeting held in December. Significant recession is coming in 2023. The buy is still short term & the sell is still in long term. Bearish rally target is 16K, 14K, 12K then last will be 10K area but we will never know it will drop even further.
BITSTAMP:BTCUSD
by JoyBoyVegae
2