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USIRYY

This chart measures pain.Spoiler alert, there is a lot. Inspired by a fellow trader, link to his idea. He is the reason I took the stock market seriously. An easy-to-explain chart. As NoOneWhoIsSomeone explained better, FEDFUNDS increases when an economy is strong. Therefore it can be a modificator for prices. The FED increases the rate when it smells money, and money smells when there is strength, historically... Now the FEDFUNDS race now is for inflation (amongst other conspiracy stuff) Does this chart work??? I don't know... Orange line: It is SPX in log scale. Blue line: I tried to add in the equation the FEDFUNDS rate. The price of SPX is divided by M2SL. This takes out of the equation the money printing. Now we multiply by 10-FEDFUNDS rate. I could do many different calculations but this is good enough for my knowledge. I am no trader, I have even managed to forget physics I did one year ago, so you could't possibly call me a genius. So take this with a grain of salt. What we find out is a new blue line which could be a measure of today's strength of economy. Throughout history, the two lines followed together, with the blue line surpassing the orange. Therefore the "strength" is higher than the SPX reading. In 2008 the lines followed through in exactly the same fashion. Even in 2000, albeit the blue line being slow, they both reached the same bottom. What we see now is the incredible. The economy's strength is already in trash. And for quite some time... It appears that my extreme ideas are not that extreme after all... Go ahead, post some hate comments below, like some did in the idea I linked. Tread lightly, for this is hallowed ground. -Father Grigori
SP:SPX
by akikostas
2
Energy ready for prime-time?An updated view Pattern taken from reverse symmetry. Elliott Waves Stochastic RSI Oscillators The 12 Month oscillator pushes everything upwards. Since the 3M oscillator is at it's top, we expect a short drop until mid 2023. It will be short because of the effect of the 1M oscillator as well as the 12M one. Oscillators tell us that it is probable for price of energy to drop until Q2 of 2023 and then begin it's rally. Energy could very well increase now. The ABC Elliott wave shown on the main chart is alarming. An alternate scenario is this. A 5-step Elliott wave. Either of them could play out. Tread lightly, for this is hallowed ground. -Father Grigori
TVC:DXY
by akikostas
2
Money Supply Bull Flag ???Maybe this is a massive money supply flag. We have support on the ribbon. Stochastic RSI confirms it. I don't know if this even makes sense, since CURRCIR is a subset of M2SL. On the other hand, who would have thought that in 1990s currency in circulation would increase by 50% in less than a decade. Or is there a ceiling prohibiting more increase? Also look at the ratio between Europe's money supply and US. And my favorite, the most accurate retracement ever. Total "purchasing power" of Europe vs US. Just recently we have reached a perfect golden ratio. 1 in 10.000 accuracy. Maybe this is a harmonic pattern. Feel free to guide me as to what this might be. And how price might continue in the following months/years. A closeup view. Maybe Europe will print so much money that it diminishes its currency. This chart suggests that EURUSD is in reality much weaker than it seems. A lot of Euro is printed compared to Dollars. Maybe they get more hawkish than the US and increase rates to >5%. I am not sure... Prepare for unforeseen consequences I guess? - G-Man, Half-Life 2
FRED:CURRCIR
by akikostas
M2SL | Duplex Megaprinter 8000 ™Back in the 80s, we thought that by 2020 we would have an automated oven and flying cars. All we got is a money printer, and we liked it. We played with it a lot. And this year for Christmas, who wouldn't like some more printer ammo? Since high inflation cannot ensure social stability, we have only one option. Lower inflation. That is the motto of the FED, the hope of every investor, a lower inflation figure. The consumer is overwhelmed from the increasing cost to survive . The inflation war is nowhere near it's end. We have gone from commodity inflation to services inflation, to the everything inflation. We haven't managed to stop it. What if there was another way? Actually there is another way. If you break the oath of "never read the news" and actually read the news, you will realize that the average consumer is getting the help they need from grants. Governments throughout the world have found the way for social stability. They simply buy us off. Record high electricity bill? No problem, here is a grant, the government is paying a percentage of the bill as a help. Expensive fuel? Here are 100€ in fuel discount to go to work. It is like the best Christmas ever. Businesses get to enjoy 100% of the earnings they want, consumers consume, and governments have social and financial stability. They just have to keep the game going, keep the printer full of ink. Everyone is happy. One could say that this perfect scenario we are in cannot fail. And even if it breaks, we keep the printer rolling. Sometime in the not-so-distant-future of course, something could break. We have just moved the problem from the consumer to the investor/corporation/government. We have gained some time. It is just incredibly difficult for me to understand what could break if this game goes on and who will take the dive. At what point will this printer stop helping us? Right now it helps many. Also go out and talk with people, almost nobody talks about inflation as a problem that could completely destabilize the global economy. They just care about the immediate issue, that everything is expensive. We are humans, and not a very wise kind. We are an infant species (like Dr. Breen said). Even now that we realize what we have created, and try to solve it, we do it in a fashion that will ultimately turn against us. We buy out everyone and everything, we have made humans more dependent. With all that technology around us, I realize that we are incredibly fragile. We haven't managed to be empowered from technology, we are swallowed in it. And we hate the word Plan B, imagine how trapped we are in when we don't cover our bases. We buy out our problems because we search for the easy way out. That's the reason we made the printer in the first place. We needed to solve one issue, ignoring the future repercussions. After all that epilogue, I will now add the prologue. This idea is upside down, like everything around us these days. On the main chart, we see that we have found support on the weekly ribbon. The 1M (and 2M) chart suggests that we are heavily supported from below. Do note that dropping oscillator on money supply does not mean significant price drop. Since money supply increases exponentially, a bearish oscillator suggests that we are on the upper side of the trend. This chart shows us the Reverse Repurchase Aggreements. We have RSI divergence, and stochastics dont help the situation. RRPONTTLD dropping is signaling QE. As SPY_Master stated in this idea, this chart shows us the effort the FED does to fight inflation. Yields show a similar picture. We are under significant resistance from the 200EMA in the 2M chart. Stochastics print a bearish signal. CURRCIR/M2SL may be printing a bull flag. What will be the effect if currency-in-circulation increases compared to money supply? How will prices and inflation react? We have already had significant increase in the past year in the ratio. US money supply is showing signs of increasing, or at least stagnating. This chart comparing US and EU is alarming... Tread lightly, for this is hallowed ground. -Father Grigori
FRED:WM2NS
by akikostas
1
2022 Yearly Recap - SPY QQQ DIA IWM DXY US02Y EFFR USIRYY Looking back over the last year (22'), as the saying goes "hindsight is 20-20". That said, here's the recap on the 22' market cycle against the backdrop of the Federal Reserve Interest Rate Hiking Cycle (one of the fastest on record) — while at the same time, we (investors) are all asking "What's next for 23'?" TOP SECTION DXY - Dollar Index ($104.51) 🔼 ✅ (Green Line) US02Y - U.S. 2yr Treasury (4.38%) 🔼 ✅ (Black Line) US10Y - U.S. 10yr Treasury (3.84%) 🔼 ✅ (Blue Line) EFFR - Effective Federal Funds Rate (4.33%) 🔼 ✅ (Orange Line) USIRYY - U.S. YoY Inflation Rate, Federal Reserve Target Rate = 2% (7.10%) 🔼 ✅ (Baseline = 2%, Red = Above Target, Green = Below Target) BOTTOM SECTION SPY - S&P 500 SPX ES1! (YTD 22', -19.92%) 🔽 🩸 QQQ - Nasdaq NQ (YTD 22', -33.95%) 🔽 🩸 DIA - Dow Jones Industrial Average DJIA (YTD 22': -8.77%) 🔽 🩸 IWM - Russell 2000 RUT (YTD 22': -22.57%)🔽 🩸 Prediction(s) these asset classes for 23'? Let me know your macro trade(s) in the comments below! 👇🏼 All Asset Class Chart Template 📊👇🏼 www.tradingview.com Index Chart Template w/ YTD Return Indicator 📊👇🏼 www.tradingview.com
TVC:DXY
by kylemusserco
Inflation!Oh yeah, inflation... Just how much though??? One of the main "benefactors" for inflation is money supply. Printing money fast and not managing it to create growth, is bad... unsurprisingly. For the last 2 years, an astronomical amount of money was printed. But have we seen it's effect? To figure out these HOT questions, we use charts. Opinions don't do us any good for important issues, facts do. First: M2SL (Money Supply) Specifically the rate of change. We use the ROC indicator, set in 24 months. This chart above, the ROC is looking familiar... It looks like the rate of change in money supply, follows the inflation rate. So we might have something. I hear you say, on the far right we see an explosion in money supply ROC, and we witness the explosive inflation rate we had this year. Thankfully, ROC is now almost turning negative, and inflation is showing signs of slowing down. Not so fast. Look at the following chart. In this chart we have 3 lines, blue is money supply ROC, orange is time-synced inflation rate, and the faint white line is inflation moved 2 years earlier. I tried to match the money supply ROC peaks with the inflation peaks of 1970s. Do note that the M2SL ROC for a specific date, takes the average ROC for the past 24 months (2 years). So the delay between money printing and inflation showing it is at least 2 years . The ROC chart is delayed by itself, and it shows inflation change 2 years before the official inflation rate changes. Alarmingly, the chart above shows us that we are in the middle of inflation explosion. A magnified view. I hear you say again, but inflation is rapidly dropping, so it is peaked. This chart above does have an indication of scale as well as timing. It is obvious that the rate of change stood much higher for long, more than any other time in history. So inflation should be quite substantial. Perhaps more than 15% we had in 1970s. We need to prove that it is higher though... Second: Total money printed I tried comparing the cumulative money printed in the decade before the inflation peak, this led me to a dead end. Percentages are identical. It looks like an inflationary shock today, too much was printed too fast. This is a key difference between the two periods. Third: What is the "fair" amount of money we should have printed? So what if, we try comparing money supply with the total GDP. The ratio M2SL/GDP. If you saw my previous idea, I learned that the GDP/M2SL ratio is basically the money velocity. The idea behind the M2SL/GDP (which is 1/M2V) is simple, just how much excess money have we printed for the gross domestic product we have? I hastily explained in my previous idea, and I will try to explain it again, comparing these two different periods. During the period of stagflation (1970s) we had money velocity in a slow but steady growth. Now we have the complete opposite. We have too much money printed for how much we produce. I don't have the knowledge to pinpoint how much of an increase this could cause to inflation though. I tried some things in my previous idea. And finally, fourth: Yields This are disappointing. Markets don't want high yields, and they refuse to price-in higher yields. It could take many months before this barrier is broken. This is a 3M chart, so timeframes are quite long. Market's yield is preceding FEDFUNDS. While I am not experienced on the mechanics of how the FED and the market are reading/predicting/using yield rates, this chart shows us that FEDFUNDS always follows US02Y. Keltner channels show us the opposite side of the EMA Ribbon. If we trust the one, we trust the other. We are almost inside the top Keltner channel, a bearish phenomenon. Unfortunately for the low-inflation-dream, we might have reached a top for now. FEDFUNDS is poised to grow a little more, and US02Y shows signs of weakness. Like 2008 (and every other rate-hike-era), we may have reached a top. And an extra: Inflation predictions for other countries I talk about the US, but I am from Greece. Right now, we are voting for next years budget. This budget is presented as a great one (let's not get into politics). Everything is good regarding it. Curiously, on the first paragraph basically, it states that "this budget is made considering an average inflation rate for 2023, 5 points higher than this year. (I am paraphrasing, I don't present an official transcript) Inflation reached a high of 12%, a 30 year record. Europe countries like mine, are bracing for higher inflation for next year. The problem is nowhere near to a solution. Tread lightly, for this is hallowed ground. -Father Grigori
ECONOMICS:USIRYY
by akikostas
11
1969, 53 years laterIt is like 1969, only exactly the same. (A quote Ashens would say) Sticky inflation begins Gold stagnating Cheap oil, and then not that cheap Space exploration And the following years after 1969, look what happened to: Inflation: Remained for 10 years Gold: After a disappointing drop in 1969-1970, it exploded 19x until 1979. Oil: Increased 10x until 1980 Space: We went on the moon several times, and then we lost the technology. PS. There may be more similarities I am not aware of. So what will happen now? Exactly the same, all over again. -- Stubborn inflation -- Gold exploding (not bitcoin, they will ban this stuff and go all-out in CBDC. CBDC is like CBD only nothing like it. It is the dream of governments. They certainly encourage both of them. I don't post an opinion on CBD, I am just posting a joke.) -- In a couple of years, we will see today's oil prices and actually want them. Now we obviously don't want them, it is like we are on sales and we just don't know it, yet... -- We have apparently "landed" on a meteorite which is like exactly the same as in 1969 when we apparently landed on the moon. They like to make history repeat itself. If we find the technology we lost all these years ago (maybe Elon with a plethora of CBDC and CBD will find it). Maybe our bodies will go to Mars. Or more probably, we will take an AR experience to space, because that will save the planet. Let's hope that in 8 years from now, we will not be in 1984. We are definitely stepping towards it. (I know 1969+15 is 1984, and 2022+8 is 2030. Things are going much faster than 50 years ago.) Tread lightly, for this is hallowed ground. -Father Grigori PS. Let's also hope that we don't meet up with Father Grigori, zombies or the combine.
SP:SPX
by akikostas
2
The Fed Conundrum and the Housing Market CollapseThe Fed money tightening policies are using interest-rates as a lever to fix a balance sheet problem. Higher rates feed right back into the CPI, initiating the doom loop. After the financial crisis of 2008, The Fed employed a policy action to reduce the federal funds rate to a range of 0-0.25% for seven-(7) years, during which time the CPI fell. Post-pandemic (COVID), the CPI is 97% correlated to the Fed balance sheet. Looking historically, in 1980's, the Fed Rate was ~19% (real rate was 8%). Compared to today, the Fed Rate is under 3% and Real Fed Rate is at -6%. Folks already crying about a 3% Fed Rate. A colossal policy error in the making, or is everything going "according to plan"?
FRED:MORTGAGE30US
by shri30389
4
Black Swan = DXY cross up CPIEvery time DXY crosses up inflation line ( ECONOMICS:USIRYY ), it caused big dump on Bitcoin (the momentum is after the announcement of the inflation , see dates in graphic). In October 2020 (crossing happened on nov 12th), this failed because it happened below 50% level which is less significant. Next announcement of the inflation will be on October 13th, hold your horses till then. Because the level of this crossing will be higher than previous ones, probably the dump will be also more significant. It can also be concluded that every time inflation line crosses up DXY , Bitcoin increases and even starts a bull market when this crossing up occurs below 50% level. The expected price level of the big dump is approximately the price level of the last inflation crossing up DXY so $ 11655 or $ 19700 (if you accept October 2020 crossing as significant and that would mean that big dump has been already priced in).
BITSTAMP:BTCUSDShort
by MyNameIsEmrah
3
The Proper Perspective on InflationAs any true trader knows, the inflation rate DID NOT GO UP 8.3%. That is what some retail news outlets claimed "year-over-year," which is plain misinformation. The retail news was designed to trigger a panic dump among the less informed last week. FACT: The rise in inflation started in late 2020, not this year. FACT: The rise in 2021 went to 7%. But the news seldom mentioned it last year. Nope, it was all about vaccines and Covid, etc. The inflation rate went down. It has been trending downward at a sustainable rate. Anyone who thought it would be lower was not paying attention. There is a 3-month decline, and it is due to falling oil prices which were constantly boosted upward during August by the big banks trying to move more investors into buying oil stocks. So, with fluctuating prices of oil between 80 - 92, there was NO WAY inflation would tick down to 8.1%. In August of 2021, inflation had already risen to 5.3%. Now in 2022, it has dropped to 8.3% from the peak of 9.1% in June. So it's 3 points higher than a year ago, obviously not 8.3 points higher. During the pandemic of 2020, the news about the Federal Reserve Board was all lathered up about deflation, that deflation was about to happen, and the world was coming to an end!!!! Sigh. Some people just have to have bad news to feel good, I guess. Oil and the war in Ukraine, which appears to be settling down with the Ukrainians taking back what is rightly their country, has lowered oil prices from $125 to 80-90, fluctuating regularly. Oil needs to drop to 70-80 for inflation to move down more. Slow improvement is how it is going to be. To assume inflation would just drop back to 2% is irrational and illogical. What is an ideal rate? For an expanding economy: around 4-5%. See that red arrow? That should be the goal. It probably is not, but it should be. Inflation lower than that indicates a sluggish economy with a lack of raises for the workforce. When inflation is not in the economy, corporations use buybacks to boost their stock prices, which creates fake rallies.
ECONOMICS:USIRYY
by MarthaStokesCMT-TechniTrader