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11/21/23 All Indices Daily Outlook#NAS #SPX #US30 #DailyReview #DailyOutlook In the over night sessions, price was the smoothest on the indices, as the price failed to take out the PDHs on SPX and US30. NAS tapped the PDH and traded above it only to move back into the previous day’s range. The #fomc meeting notes and Treasury Secretary Janet Yellen in the afternoon seems to have held up up for now. The #homesales numbers came in off projects: 10:00am USD Existing Home Sales 3.79M 3.90M 3.95M The interest rates have dropped but this isn’t the time we’d typically see this number kicking up. Each of the indices has traded into 4H+FVG and that implies that we could still move up from where we are. The PDL from yesterday is my SSL draw if we push to the downside and the PWHs are still my targets for an upside move. #BullishCase As we have rest in this 4H+FVG on all 3 indexes, we’ll need to look for price to hold. As long as we don’t have an impulse to the downside through a PDL, we should be okay to still see a move from the FVG range. SPX and NAS, both have BSL as targets from the Closing session. But the targets, aside from this will be the the BSL, PDH and Was for all the Indices. #BearishCase If we manage to trade through the PDL on each of the indices and we do so with an impulse this will change my view of the short-term/ midterm to look for a sell. This would imply that the 4H+FVG has been mitigated and we could potentially see that IFVG or inverse FVG setup play out. For either situation patience and price action will lead the way! All Charts 1H
FOREXCOM:NAS100
by Cory4rex
On the lighter side of thingsThe questions in recent times... - Is the federal reserve going to slow down on future rate increases? - Could we see a cut in rates in 2023? - With terminal rates still undecided, could it be revised higher? Perhaps the height of the Central Banker of the US Federal Reserve could be a leading indicator of interest rate decisions! (I'm not being serious, but it was interesting to see the correlations) I started trading FX when Chair Bernanke (5ft 8in) was in the prime position and oversaw a steady decline in interest rates (ignoring the fact that the Global Financial Crisis caused significant turmoil in the markets) The current Chair, Jerome Powell stands at 5ft 10in, an increase from Chair Yellen at 5ft 3in. A change in the Central Banker height trend has led to US interest rates climbing higher from 0% to the current of 4.75%!! Chair Greenspan (5ft 8in), was THE first central banker I've read about and probably what got me interested in the financial markets, ushered in a strong US economy in the 90s. Greenspan oversaw rate hikes as he too battled with "high" inflation in 1997. So, perhaps instead of overthinking about employment, CPI, GDP, QE, and YCC, all we have to do is pay attention to the change in the height of the Federal Reserve Chairperson. What do you think?
TVC:DXYLong
by JinDao_Tai
Game Theory and the US Debt Crisis ShowdownE-Mini S&P ( CME_MINI:ES1! ), Euro FX ( CME:6E1! ), 10-Year Note ( CBOT:ZN1! ) True or False? • US Government has never defaulted on its debt obligations. • US Treasury bonds have always maintained AAA credit ratings. A history lesson: In June 1812, 30 years after the Revolutionary War, the U.S. declared war against Britain and Spain. In August 1814, British troops burned Washington, D.C. With the Treasury building destroyed, Uncle Sam was unable to service its debts for months. Extraordinary circumstance it may be, this was a default, nonetheless. In 2011, the federal government inched close to its $14.294 trillion debt limit. In April, the Standard & Poor’s responded by changing the outlook of US sovereignty debts from “stable” to “negative”. On August 5, 2011, S&P downgraded US credit ratings from AAA (outstanding) to AA+ (excellent). Moody’s and Fitch retained the triple-A ratings. However, they changed the US outlook to “negative”, in June and November, respectively. Global stock markets declined on Monday, August 8, 2011, following the downgrade announcement. Three major U.S. stock indexes lost between 5% and 7% in one day. What happened next blew our mind. U.S. treasury bonds, the very subject of the downgrade, rose in price! Amid the worsening creditworthiness of the US government, the US dollar gained in value against the Euro and the British Pound. This is a classic example of a general flight to safety. “When America sneezes, the world catches a cold” . Deteriorating financial conditions in the US triggers more severe economic crisis in the rest of the world. At the time, investors were concerned about a European debt crisis, and they pulled money out of Europe and into US dollar and bonds. The US Debt Ceiling Per the definition by the US Department of Treasury, the debt limit is the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations, including Social Security and Medicare benefits, military salaries, interest on the national debt, tax refunds, and other payments. The debt limit, also called the debt ceiling, does not authorize new spending commitments. It simply allows the government to finance existing legal obligations that Congresses and presidents of both parties have made in the past. Failing to increase the debt limit would have catastrophic economic consequences. It would cause the government to default on its legal obligations. That would precipitate another financial crisis and threaten the jobs and savings of everyday Americans. Congress has always acted when called upon to raise the debt limit. Since 1960, Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit. The current U.S. debt limit stands at $31.4 trillion. Current Debt Ceiling Crisis Last Thursday, in a letter addressed to House Speaker Kevin McCarthy, Treasury Secretary Janet Yellen warned the US has once again reached its debt limit. The Treasury Department started taking extraordinary measures to keep paying the federal government’s bills, but it will suspend new investments until June 5, 2023. Yellen warned both moves are subject to “considerable uncertainty” if Congress does not pass a bill to increase the debt ceiling. Highlights of current US government financials, according to USDebtClock.org: • US National Debt: $31.50 trillion • US Federal Spending: $6.00 trillion • US Federal Tax Revenue: $4.61 trillion • US Federal Budget Deficit: $1.40 trillion • 2022 US GDP: $25.93 trillion • Debt to GDP Ratio: 1.21 A comparison to data from my previous report, “The Real Cost of Fed Rate Hikes”, shows big spending just gets bigger in merely six months: • Medicare: $1.52 vs. 1.40 trillion, up $120 billion • Social Security: $1.25 vs. 1.00 trillion, up $250 billion • Defense: $776 vs. 751 billion, up $25 billion • Debt Interest: $523 vs. 440 billion, up $123 billion It’s worth noting that the Fed hiked interest rates and the Treasury got stuck with bigger interest payments. It’s like a boomerang hitting back at the US government. As I have expected, “Debt Interest” could overtake “Defense” as the third largest budget item. This could happen in the new annual budget cycle starting October, as Treasury gradually retires cheap bonds and must borrow at much higher rates. A Public Showdown on the US Debt Ceiling The White House urged Congress to raise the debt ceiling “without condition.” House Republicans, emboldened by their recent majority party control, are preparing for a hard fight. “You couldn’t just keep increasing it,” said House Speaker Kevin McCarthy. He called for cuts to avoid bankrupting programs like Medicare and Social Security. GOP lawmakers want to slash spending as part of an agreement to increase the debt limit. Some have said major spending cuts to key government programs were part of the negotiations that helped McCarthy win the speakership. Excluding the rare 1814 precedent, the U.S. government has not defaulted on its debt. However, the debt ceiling has been raised 22 times from 1997 to 2022. Concessions sought by the new Republican House majority have led to concerns that Congress could have trouble raising the debt ceiling before June. The Looming Default Deadline Secretary Yellen's early June deadline is an educated guess at best. Billions of dollars go in and out of the Treasury coffer daily. While many variables affect the government balance sheet, the biggest unknown is: How much will the government receive by April 15th? I think that the government default is closer than it appears, as Uncle Sam may get a smaller tax revenue this year. Please hear me out. The market capitalization of the entire US stock market is estimated at $40.5 trillion at year-end 2022, down $11.7 trillion or -22.5% from a year ago. An average investor might have lost 20% or more in her stock portfolio last year. A rational investor would sell the losing stocks at the year end to claim tax loss. Let me illustrate this with an example: Sherri put $10,000 each in 10 stocks in January 2022. By December, five of the stocks gained 10% on average, and the other five lost 30%. She decided to keep all the winners and sell all the losers at year end. This allows Sherri to record capital loss of $15,000 (=50,000x30%). Scenario 1 If Sherri made a taxable income of $80,000, without taking into account of capital loss, her tax bill would be $4,807 plus 22% of the amount over $41,775. $4,807 + ($80,000 - $41,775) * 22% = $13,216 Scenario 2 If Sherri claims all the capital loss in one year from her annual taxable income, her new tax bill will be $9,916, a reduction of $3,300. $4,807 + ($80,000 - $15,000 - $41,775) * 22% = $9,916 If more and more investors are doing the same thing, Uncle Sam may find a short fall in personal tax income in the tune of hundreds of billions of dollars. The prospect of corporate income tax revenue is not much rosier. US companies were met by high inflation, high labor cost, high energy bill and higher borrowing cost last year. All would hit the bottom-line, resulting a smaller tax bill. Game Theory: An Analytical Framework This dark picture may actually bring in opportunities for event-driven trading strategies. First, we could use a Game Theory Matrix to analyze the situation. In summary: • Republicans and Democrats each have two options: to fight or to talk ; • If they fight hard and are not willing to compromise, the debt ceiling could not be raised, and the US would default on its debt obligations; • If one party compromises first, it will bring the other party to the negotiation table; • If both parties are engaged in serious talk, they may reach a compromise and an agreement on a new debt limit; • There will be many rounds of negotiations. The talk may not necessarily be successful. It could break down at the end, leading to a default. In my opinion, a US default is no longer unthinkable. The Republicans have good reasons to carry through their threats if they could not get the compromises they seek for. After all, the blame will mainly fall on to the Biden Administration. If a US default is what it takes to bring the country back to fiscal responsibility, so be it. Event-Driven Strategies Taking the 2011 S&P downgrade as a guide, a US default could push T-bonds up and global stock markets down. Euro and Pound could depreciate against the dollar. In retrospect, I found that the rounds of fight and talk offer more trading opportunities. Each move could send shocks and ripples through the financial systems. In Long Strangle options strategy on CBOT Wheat last June, we recognized that the Russia-Ukraine conflict moved the wheat market with battleground actions, not one time but by multiple actions. CBOT 10-Year T-Note (ZN), CME E-Mini S&P 500 (ES) and CME Euro FX (6E) are possible instruments to apply this strategy. When the odds of default and new debt ceiling are both reasonably large, Strangle Options may be applicable. I would consider setting up out-of-the-money calls and OTM puts on the June futures contracts in March. It works the same way on either ZN, ES or 6E. Debt ceiling negotiations will pick up pace after the April 15th tax date. I expect a lot of market-moving breaking news in April and May. When you hold both calls and puts, you may find that regardless of whether the negotiations advance or break down, one of your positions will gain in value. Happy trading. Disclaimers *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
Editors' picks
CME_MINI:ES1!Short
by JimHuangChicago
22
Analysis of the Federal Meeting todayThe meeting of the members of the Federal Reserve was held today at 17:30 Iranian time. In this post, we will analyze his speech and the direction of the market. Remarks by Mr. Powell US Federal Reserve Chairman Jerome H. Powell said in a statement today: 1- Inflation is expected to decrease 2- Trying to control inflation and employment 3- Reduction of inflation in the first half of 2022 4- Waiting for the debt limit to be lifted Conclusions from Powell's speech: The United States is working to boost trade and businesses in the post-corona era by increasing liquidity. This increases inflation by increasing liquidity For this reason, increasing liquidity increases inflation and, due to the higher cost of using labor and consumer goods, creates a catastrophe (similar to Iranian policy) if left unchecked. Mrs. Yellen's words US Treasury Secretary Janet Louise Yellen said today that I would like to make a few points: Waiting for the debt limit to be lifted Failure to raise the debt ceiling would be a disaster Market reaction to these negotiations: The US dollar index (DXY) fell from 94.373 to 94.107, after which the gold and currency pairs on the right side of the US dollar entered an uptrend. In the currency pairs that have reached the bottom, you can now expect an upward trend. Please follow me and like this post. I'm on Twitter too. (Trying to be the best)
TVC:DXY
by mohamadrezaKhorsand
3
BTC Making Moves to test $46k downtrend line & FB DiemBTC is making some major inroads to test the descending purple line near $46k in the coming days. Remember today is Sunday and that a lot of WSB traders who aren't active on weekends are going to wake up tomorrow and switch to buying bitcoin and crypto again... the two communities are highly aligned ideologically imo. Also, the volume lately has been extremely low and a move like this was overdue as low volume eventually begets high volume and in a selloff of a wave 4 correction - this sort of movement is expected - there was also bullish divergence in this move down which is also a confirmation we're in wave 4 and heading into wave 5 (which may have started already) Additionally, Yellen / Powell / CFTC / SEC are trying to come up with some regulatory guidelines by end of July and this is likely imo MOSTLY related to FaceBook Diem which has yet to announce their full plans. Just a recap, Facebook moved Diem's HQ from Switzerland back to the US only a couple months ago. This was likely done b/c the FB legal team has regulatory clarity on future of crypto and future of stabelcoins - Diem's main product. It is my opinion that Yellen is all of a sudden serious about getting something out b/c Diem is working with them and probably pushing to have something done sooner rather than later. This is NOT priced in at all. Once FB announces their intention for a global stablecoin that has signoff from the Fed and Treasury we're going to see a massive spike in interest in crypto from people who have not heard of it yet. $60B of Tether awaits patiently!
Long
by ich1baN
1
I AM ANALYZING FOR YOUR COMFORT - SILVERYellen's departure yesterday scared investors in metals terribly. particularly silver is easily frightened and diverted from its path. Unfortunately, the beginning of a beautiful bullish trend was transformed by Yellen into a moderate decline, but followed by indecision. The question mark launched on raising rates and implicitly the USD, will weigh seems quite difficult. The silver only needs 2-3 days for braking, and only then to think about whether to go up, or wait for clarifications. Normally he should try to recover from yesterday's decline, especially since Yellen later retracted, but we're talking silver, so be patient!
S
by Viorex
Japanese yen flirting with 109The Japanese yen is almost unchanged in the Monday session. Currently, USD/JPY is trading at 108.74, down 0.09% on the day. The Japanese yen remains vulnerable and the symbolic 109 level is under strong pressure. The dollar has had its way with the yen in 2021, as USD/JPY has jumped 5.5% this year. Last week, the pair climbed to 109.36, its highest level since June 2020. The yen is particularly sensitive to rate differentials between the US and Japan, so the increases in US yields are putting strong pressure on the Japanese currency. The 10-year Treasury yield enjoyed another strong week, rising to 1.72% on Friday. Although the 10-year bond has retreated to 1.67% on Monday, the trend remains positive for bonds, which likely spells more trouble for the shaky Japanese yen. This week has more than 100 billion dollars in government bond auctions, which will test the market's appetite for bonds following last week's Fed policy meeting. In Japan, the equity markets are sharply lower after the BoJ widened its JGB trading band and tweaked its ETF guidance at its policy meeting on Friday. BoJ Governor Kuroda didn't surprise anyone when he said that monetary easing would continue for a long time. The bank has opted to make some tweaks rather than overhaul its monetary policy, and for this reason the bank's inflation target of 2 percent is likely to remain a bridge too far for the foreseeable future. Later, the bank releases BoJ Core CPI, its preferred inflation gauge (Tuesday, 5:00 GMT). The market will be again paying close attention to the Federal Reserve this week. Later on Monday, Fed Chair Powell will participate in a panel and we'll also hear from FOMC members today and on Tuesday. Powell will testify on Tuesday and Wednesday before Congress, together with Treasury Secretary Yellen. The topic of Powell's testimony is the CARE Act for Covid relief, but investors will be looking for any comments related to higher bond yields or inflation. Any remarks in this regard from Powell or Yellen could shake up the US dollar. USD/JPY is currently range-bound. On the downside, the pair is putting pressure on support at 108.55. Close by, there is support at 108.20. There is resistance at 109.30, followed by resistance at 109.70
by OANDA
The Dinosaurs are back 🦕🦖🐊Ladies and Gentlemen, The Dinosaurs are back: The Super Dragausaurus has appeared in Italy , just a few weeks after the most ethical dinosaur , the famous Yellenosaurus , made it's appearance back i the financial markets. A third one, the bald Amazonosaurus Interneticus of the Americas has decided to go for a healthy walk from Ceo to Executive Chair Who is best? Mario Draghi🦕.. nobody messes with Super- Mario, he is fun and Italian🍝 Who is worse? Yellen🐊... taking 700,000$ from Citadel and now pretend she will regulate and save the markets
TVC:FTMIB
by FX_Professor
6
S&P 500: Total change in administrative power2018 is off to an interesting start. Trump has been in office for more than a year, 2/5 saw the most bearish performance in the history of the S&P in one day, and Janet Yellen's term as Chair-person of the Federal Reserve has come to an end. The philosophical economic theory portrays recession wave cycles to happen every 7-8 years, but there has not been a notable recession since 2008 with struggling attempts to raise interest rates. Now with Trump's policies in full effect, How will the U.S. economy be impacted from a Trump Administration in the drivers seat? 2017 saw a new President in command and with the old President's policies still in effect showing bullish economic performance after Obama walked out of the White House. Now one must think, Do we have a big Elephant in the room called "the Next big Recession"? More money is individually made when markets are bearish instead of bullish. If all of these signs are lining up in full synchronization, then this could possibly be the start of the next big economic recession........
SP:SPX
by brentonyoung
Few Dollar Appetite LONG and SHORT Position on DXY, Dollar IndexHere's another confirmation about our last idea Of course this time my guidance is a dollar appetite for this month and next with the FED decision to hike interest rate, but here's the deal: buy dollars or keep it till November 22nd where dollar should hit and maybe smash 96.32 - 97.84 level, Then close all your long positions 'cause this hike should happen this year, but if they do or not, price could reject at that level anyway and start to see how dollar plunges. However, my target to go long is 96.32 and then to go short my first target would be around 93.02 and at finally around 85.10 for next march 2018 . Just in case if we don't see this, I'll be updating, stay tuned. Cream Live Trading Cheers!
TVC:DXYLong
by wildcreamlife