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EURUSD:Couple of Scenarios depending on Friday's NFPHey Traders, above is a technical overview on EURUSD and the most important zones to watch, Fed yesterday have threw some hawkish comments "rates are likely to be higher than previously anticipated", but before the next FOMC we have a couple of events to consider. First of all NFP and next week CPI data. If NFP comes again above expectations that will signal more rate hikes from the fed and thus more USD strength and EURUSD downsides. If the numbers are normal that will not be enough for fed to hike rates massively. and for CPI it's the same story. Numbers above expectations will lead to a more restrictive monetary policy and normal number will slow down the pace. Feel free to ask any questions in the comment section. Trade safe, Joe.
by JoeChampion
53
EURUSD Potential Forecast | 8th March 2023Fundamental Backdrop 1. Fed Powell mentioned yesterday that the Fed will not hesitate to hike rates at a faster pace if data shows the resilience of inflation and the US economy. 2. This resulted in strong bearish pressure and momentum coming into EURUSD. Technical Confluences 1. Price has officially broken structure. 2. Lower highs and lower lows has been formed. 3. There is a high probability that price can tap into the key support at 1.0465. Idea I will be looking for price to continue its bearish momentum in the market and for price to tap into the H4 support level at 1.0465. NOT FINANCIAL ADVICE DISCLAIMER The trading related ideas posted by OlympusLabs are for educational and informational purposes only and should not be considered as financial advice. Trading in financial markets involves a high degree of risk, and individuals should carefully consider their investment objectives, financial situation, and risk tolerance before making any trading decisions based on our ideas. We are not a licensed financial advisor or professional, and the information we are providing is based on our personal experience and research. We make no guarantees or promises regarding the accuracy, completeness, or reliability of the information provided, and users should do their own research and analysis before making any trades. Users should be aware that trading involves significant risk, and there is no guarantee of profit. Any trading strategy may result in losses, and individuals should be prepared to accept those risks. OlympusLabs and its affiliates are not responsible for any losses or damages that may result from the use of our trading related ideas or the information provided on our platform. Users should seek the advice of a licensed financial advisor or professional if they have any doubts or concerns about their investment strategies.
Short
by OlympusLab
1
Gold as an Inflation Hedge? Myth Busted!COMEX: Micro Gold Futures ( COMEX_MINI:MGC1! ) and Gold Options ( COMEX:GC1! ) Gold is often hailed as an effective hedge against inflation. It generally increases in value as the purchasing power of the US dollar declines over time. Does this still remain true? Since January 2013, the US Consumer Price Index increased 29.4% cumulatively, while the 10-year total return of Gold is only 11.3%. Let’s demystify the gold myth. In fact, gold is by no means among the best-performing investment assets in the past decade! Let’s look at where investing $10,000 in different assets would take you in the past ten years: • If you held $10,000 in cash, you still have $10,000, a 0% nominal return; • If you bought a gold ETF fund, you would have $11,300, assuming it tracks gold price perfectly. However, after subtracting an average 0.5% a year in fund expense, you would end up with only $10,800, an annual return of merely 0.78%; • 5-year bank certificate of deposit (CD) yielded 1.0%/APR in 2013 and 1.5% in 2018. If you put the money in CDs back-to-back, you would have $11,322 now; • If you invest in a market index stock portfolio, the S&P 500 gained 159% in the past ten years. You would end up with $25,900; • If you bought bitcoin at $4.43 each in January 2013, you would have amassed nearly $1.6 million from the original $10K, an astonishing 15943% return! Actual data shows that holding gold, a non-yielding asset, underperformed other investable assets in the past decade. Gold price endured a double-digit decline, from $1,600 per troy ounce, to as low as $1,000, during the low-inflation period of 2013-2018. It shot up in 2019 as the US-China trade conflict intensified. The outbreak of Covid pandemic pushed gold to a record high of $2,075 in August 2020. As US economy remerged from Covid in 2021, gold price fell back to $1,700. Then, the Russia-Ukraine conflict pushed it back up above $1,900. However, when the Federal Reserve embarked on the path of rate increases, gold price fell sharply to $1,600. This was a period where US CPI raged between 7-9%, and gold completely failed as a defense against inflation. US Dollar Is the Primary Price Driver Gold prices rose on Friday as a rally in the dollar and bond yields paused. COMEX Gold Futures (GC) for April delivery closed up $14.10 to $1,854.60 per ounce. The rise comes on expectations that higher interest rates are on the way as reports show that US economy is still running too hot to quell high inflation. Dollar index was down 0.35 points to 104.68, while the US 10-year note was paying 3.977%, down 8.4 basis points. US dollar continues to call the shot for gold as investors assess the Fed's rate path. The above chart shows a perfect negative correlation between gold price and dollar index. When dollar rises, gold falls; and when dollar declines, gold advances. Last month, the dollar's bounce had weighed heavily on gold. The dollar rallied as a run of hot U.S. labor and inflation data saw traders’ expectations for more aggressive Fed rate increases. A stronger dollar can be a drag on commodities priced in dollar, making them more expensive to users of other currencies. In recent weeks, gold may have found some support on fears that an aggressive Fed could push the U.S. economy into recession, but a continued rise in U.S. Treasury yields, along with a relatively resilient dollar means limited upside . Rising Treasury yields raise the opportunity cost of holding non-yielding assets, like gold. Short-term Trading Strategies At $1,850, gold is neither too expensive nor too cheap by historical standard. As such, I am not in favor of an outright directional trade, one way or the other. However, the market’s razor-thin focus on Fed rate actions will make a compelling reason for event-driven trades on Gold Futures and Gold Options. March is a very active month for macro-economic data releases: • March 8th, Fed Chair Powell will testify on the central bank's semi-annual monetary policy report to the House Financial Services Committee; • March 10th, Bureau of Labor Statistics will release February employment report; • March 14th, BLS will release the February CPI report; • March 22nd, Fed will announce its interest rate decision. Financial market tends to be sensitive to these data releases, as the latter could deliver huge shocks if actual data goes beyond market expectations. If you expect an upcoming data release to be bullish on gold, you could express this view with a long futures position on COMEX Micro Gold Futures (MGC). Each MGC contract has a notional value of 10 troy ounces. At $1,880, a June 2023 contract (MGCM3) is valued at $18,800. Initiating a long or short position requires a margin of $740. This is approximately 4% of contract notional value. In comparison, buying physical gold (i.e., gold bar or gold coin) and gold ETF fund requires 100% upfront investment. If gold price moves up to $1,950, the futures account would gain $700. Relative to the initial margin, this would equate to a return of +94.6%, excluding commissions. Alternatively, the same bullish view could be expressed by a call option of COMEX Gold Futures. Each COMEX Gold Future contract has a notional value of 100 troy ounces. At $1,880, a June futures contract (GCM3) is valued at $188,000. A call option on the 1,900 strike is quoted 37.0 on 3 March 2023. Acquiring 1 option requires an upfront premium of $3,700 (100 ounces per contract). If gold moves up to $1,950, the options account would be credited by $5,000 (=(1950-1900) x100), which represents a theoretical return of +35.1% from the original investment of $3,700. If you are bearish on gold, a short MGC futures or a put option on GC would be appropriate. Futures and options account would gain in value if the price of gold falls. Similar to investing in physical gold or gold ETFs, the biggest investment risk is betting the wrong direction. However, futures have a built-in leverage. In the case of MGC, each $1 movement in gold price translate into $10 variance in futures account balance. Options have a non-linear payout diagram. As the contract moves deeper in-the-money, options value grows exponentially. Long-term Trading Ideas After the active central bank action period is over, will gold price trend up or down? What would be the primary driver of gold price? Inflation, US dollar, interest rate, economic growth, or geopolitical crisis? All are possible, maybe a little bit of each. My research reveals that gold price has a relatively stable relationship with WTI crude oil (CL). Over the past ten years, each 1,000 barrels of WTI (1 CL) sell at a price between 150 and 300 ounces of gold for about 80% of the time. We could visualize an oil producer wanting to be paid by gold. When dollar fluctuates, he would adjust the dollar selling price to keep his gold acquisition stable. Therefore, whenever the price range is breached, gold price has a strong tendency of falling back in. In the next writing, I would explore a convergence/divergence idea between GC and CL. Stay tuned! 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
COMEX:GC1!Long
by JimHuangChicago
2
USDCAD: Top of the range?Looking back over this pair, it's been ranging for a long time. The candlestick patterns are clearly showing rejection, we now have a doji to back up the change of direction potential. Fundamentally it seems hat it doesn't matter how good the US news is, the dollar's fate is sealed. Interesting to see how NFP goes on Friday (but still can't see it getting much past 105.5 even with positive news). I'll probably wait on this pair until after the event has calmed down before getting involved. Overall I'm bearish on this, waiting for a good entry for at least a 4:1 score initially, but think it'll go further.
Short
by Finchcliffe
1
DXY:A Temporary push to upsides as Yields riseHey Traders, today we have noticed a temporary push to upsides as treasury Yields near 5%, but that will not be enough to push DXY above the major trend again as we see the price have rejected the retrace zone along with the double top. so we expect that USD will resume the downsides and remain indecisive until the release of CPI so the market will have a more clear idea on Fed next actions. if CPI numbers are high that won't make fed happy so we'll expect further rate hikes and more of USD strength.. in the opposite sense if CPI numbers come low we can expect more of a weak dollar and less restrictive monetary Policy. Trade safe, Joe.
TVC:DXYShort
by JoeChampion
46
Macro and crypto: What should traders and investors expect?Hello, everyone! Today we would like to discuss macro and crypto, what affects that, what depends on that and what to expect from the market and when the new bull cycle will start A LITTLE BIT OF THEORY 1. US PMI (Purchasing Managers Index) – macroeconomic indicator that shows the level of business activity. 2. DGS 1&5 – average 1 and 5 year US Treasury yield. 3. FED Funds Rate – the interest rate at which U.S. banks lend their excess reserves for short terms to other banks. Let’s figure out what's GOOD and what's BAD for the crypto market 1. PMI Values above 50 are a good sign, the economy is growing, markets have more liquidity. Values below 50 are a bad sign, the economy is shrinking, there is less and less liquidity in the market. 2. DGS 1/5 High rates are bad, people are used to investing where there is a clear yield and clear rules for receiving returns, where there is less risk. Low rates are good, bonds do not bring profitability, people are forced to choose more profitable, and therefore risky instruments for the preservation and multiplication of capital 3. FED Funds Rate High rates are bad, the interest on capital and liquidity is becoming more and more, the required level of profitability must be higher than the prime rate + the rate of the individual counterparty. Liquidity becomes less and less, access to it becomes more and more difficult. Low rates are good, liquidity is available to everyone, everyone can take funds to realize their goals and objectives, the overall profitability of any business is quite low. Lots of free money in the market. Which market can be called BULLISH? 1. US PMI values above 50 2. Low DGS values 1/5 3. Low FED Funds Rate That's the kind of market we had from April 2020 until November-December 2021. At that point, many realized that the music was no longer playing. The FED hammered the last nail in the coffin of the bull market in February-March 2022, and that's when all the fun and the official bear cycle began. How do we know if the market has flipped and we're growing up again? Recommendations for PATIENT TRADERS 1. US PMI will come out of the crisis – current values are ATL from May 2020 2. The FED will do a soft landing, beat inflation and start lowering rates – very bullish signal. The important thing is to beat inflation, otherwise our bull market will be very short-lived, or the next bear market will be super painful. 3. DGS 1/5 will fall to spring 2020 values If you see all of this, then unpack your stackable piggy bank and get ready for a hot period, we will be back in the game and the market of universal profits. As practice shows, everyone will have 3 to 6 months to get into their positions and get ready to take off. Also, remember that the market can be irrational, the main thing for everyone is to let their strategy survive it. Markets are capable of being irrational longer than traders will be solvent. What to do now? We’ve tried to give an answer to the question in our previous article. And we still stick to this local position. This article will allow you to look at the crypto market within macro analysis and the overall picture. But then everything depends on you! Tell us if you study the macroeconomics rates, which indicators you use and which topics you would like to discuss! Don't forget to check links below and check our trading terminal! NFA & DYOR
by Samura0x
42
Interest rates - Bond yields... Are they really going higher?Recently the market's expectation for the Fed Funds Rate peaking around 5% and then coming down at the end of Q4 2023 changed, with the market now seeing rates going to 5.5%. Many investors/analysts are discussing bond yields heading to 6% and staying higher for longer. However, is that going to happen? What is sentiment telling us right now? What is data indicating? If rates keep going up, what does this mean for other risk assets? Sentiment right now seems to be quite bullish on yields (bearish on bonds). We are probably near a short-term top for bond yields, and I think this Fed hike may be the last one. The reason is that in Q3-Q4, we started seeing an actual economic deceleration, and inflation dropped significantly. In January, we had some weird data that might have to do with seasonality and adjustments on how inflation is calculated. The critical thing to note here is that rising interest rates act with long and variable lags and that the drop in inflation since July 2022 was caused by factors irrelevant to interest rate hikes. So let's take things from the beginning... Since Covid hit, we have seen tectonic shifts in markets. Many things changed in the global economy, which was already in bad shape. It's unlikely that inflation will be contained for a long time, given that we are at the end of the debt cycle, the end of globalization, we are in a war cycle, we are at war against the climate, and the labor market is changing rapidly. Therefore, bonds will likely substantially underperform inflation in the next decade. In 2020 and 2021, fiscal policy was heavily used over monetary policy, and we still feel the effects of those policies and the aftereffects of Covid. US monetary policy started shifting in March 2022, when the Fed began hiking rates and Quantitative tightening in July. Hence the changes in monetary policy couldn't have affected markets, as it takes more than 12 months for changes like this to have any effect. Of course, we also had the Russian invasion, which caused a commodity spike, and we had Europe and the US spending a lot on Ukraine and war equipment broadly. Then the relationship between US and China started worsening, while China was under lockdown and only started reopening in December - January. The global economy is in terrible shape and will get into a steep recession eventually. Some data make it look strong at times, but it isn't. I think the Fed is looking and acting in the worst possible way, and it's trapped. At the moment, markets are afloat mainly because of human ingenuity, past fiscal and monetary stimulus, and the actions of Central banks like the BoJ, HKMA, and PBoC, as well as the BoE and ECB having some form of QE going on, while the Fed & US treasury is increasing market liquidity by draining the TGA, creating T-bills and bank reserves. It's unclear what will happen when all the interest rate hikes start affecting the economy, but Central banks and Governments will resume supporting markets and the economy. There are several tricks they can implement before they start cutting rates or continuing QE, or doing Yield Curve Control, but ultimately they will get to that point. Now finally, let's get to the charts! TLT / UB look like they are bottoming here. Swept the lows but closed slightly above them. Double top and significant gaps are higher, so that's where I think it's headed. I don't want to say that we will go massively lower, but for now, I treat this as a range, and I don't want to let my view that inflation will come down affect me. My target is the range highs and nothing more. SHY looks like it capitulated and filled a double gap (partially) to the downside. That double gap occurred near the bottom, but now we have a massive double gap open to the upside, telling me it could go higher. Both that and TLT tell me yields down (bonds up)! Short-term yields have been increasing, with US 2y getting near 5%. Maybe that's the psychological level everyone thinks will break easily, but it doesn't. The majority is eyeing 6%. Perhaps we do a slight break above 5% on the 2y, then fall quickly below it. The average bond yield (random average) is at 4.5%, it also made a new high, but this could be a trap. I am not seeing much strength here. The 10y, which I used as the base chart for today, reaches a critical level where the major correction to the downside began and has found some resistance there. Finally, I wanted to discuss a few currencies and some overall observations. EURUSD and GBP are at support but looking weak. I can see how they could have one last dip and then higher, but I don't want to see them go much lower from here. USDJPY and USDCNH are trading higher, with USDJPY being 10% lower from where it peaked. The interest rate differential was the same as now or lower, so something is happening here. Maybe rates are peaking? Maybe the interventions from CBs and Govs are working? Stocks are also much higher than back then, and they don't look like they will go down. Both pairs seem to be back in an uptrend which seems close to peaking. Based on how their charts look, I don't think the USD will keep strengthening, which is telling me that something big has shifted in markets, which is bullish risk assets, and potentially bearish on bonds yields.
TVC:US10YShort
by BitcoinMacro
1
🔥 A Collection Of Analyses Why Bears Are WRONG On This MoveOver the past weeks I've made several bullish longer term analyses on Bitcoin and the markets in general. In my view, the bottom is in and we're likely going to continue this bullish move for the next few weeks. Still, there's plenty of bearish investors. Yes, the macro is bad and a recession is likely, but that doesn't mean we can't go up. After 1 year of selling there's simply little left to sell, so the easiest path is up. Below I've made a collection of analyses and charts that all signal that the bottom is in and better times have come. 1) See the main chart. We bounced off the ~6 year support. 2) The PMO indicator has flashed a buy signal. This is a great indicator to catch big moves. 3) Bitcoin's monthly RSI is curling up, after reversing from support. 4) The crypto bear market has lasted exactly the same time as last bear cycle. Note that the bull-cycle has lasted equally long as well! 5) Bullish divergence on the BTC weekly chart. 6) A break out through the long-term bear market resistance. 7) The dollar index (DXY) is falling like a brick. A weak dollar is generally great for the markets. Every BTC bull-cycle was accompanied by a weakening dollar. If you enjoyed this overview, please like this post. Have more bullish charts? Please share them below!
INDEX:BTCUSDLong
by FieryTrading
13
Forex Alert: Fed Officials' Six-Hour Speech Marathon Forex Alert: Fed Officials' Six-Hour Speech Marathon Will the numerous appearances of US Federal Reserve officials rock the market during the closing hours of this trading week? Over the course of six hours leading up to the market's closing this week, we will hear from Lorie K. Logan (Dallas Fed), Raphael Bostic (Atlanta), Michelle W. Bowman (Board of Governors)), and Tom Barkin (Richmond), in that order, until the forex market closes. With so many consecutive appearances, traders may experience information overload, potentially leading them to avoid the market. Alternatively, they may jump into the market during this typically low-volume session to position themselves for Monday morning trading. The hope in the latter scenario is that they will put themselves ahead of other market participants who need time to digest all the comments from the Fed officials over the weekend. On Wednesday, Minneapolis Fed President Neel Kashkari expressed concerns over inflation and job data received in February following the Reserve's 25-basis rate hike. Kashkari noted that he was “open-minded” about a 25 or 50 basis point rate hike for the next one. The sentiment of other Fed officials regarding this matter should help in setting trade positions this Friday and the following week. EUR/USD and GBP/USD traders may also be interested to know that officials from the European Central Bank and the Bank of England will also be speaking this week. ECB’s Isabel Schnabel will be speaking on Thursday (EST) at the time of the release of the ECB Monetary Policy Meeting Accounts, followed by the BoE’s Huw Pill a few hours later. Christopher Waller from the US Fed will also be speaking on Thursday at 4:00 pm (EST), after Pill.
by BlackBull_Markets
A Leading Indicator for US EconomyCME: E-Mini S&P Retail Select Industry Futures ( CME:SXR1! ) Last Friday, the U.S. Bureau of Economic Analysis (BEA) released the latest Personal Income and Outlays Report. Personal income gained $131.1 billion (0.6%). Disposable personal income (DPI) added $387.4 billion (2.0%) and personal consumption expenditures (PCE) grew $312.5 billion (1.8%) for the month of January. Data shows that U.S consumer is resilient. Wage gains and inflation pushed spending growth to a two-year high. In the past decade, PCE gained 60% to $18 trillion. More recently, it surged 50% in the three years since the start of the COVID pandemic. The hotter-than-expected data indicated that US economy was nowhere near a recession. Additional data from the Bureau of Labor Statistics showed robust job growth in January and the lowest unemployment rate in half a century. Wary of bigger and longer-lasting Fed rate hikes on the way, all major US stock indexes turned negative in the month of February. As of last Friday, Dow Jones Industrial Average was down 3.8% month-to-date, while S&P 500, Nasdaq 100 and Russell 2000 recorded -2.6%, -0.8%, and -2.4%, respectively. Consumer Spending Outlook Consumer spending accounts for over two-thirds of U.S. economic activity. While PCE shot up more than expected last month, it is a lagging indicator and only confirms what happened in the past. Could U.S. consumers spend out of the peril of a recession? Retailer stock prices are forward-looking and reflect collective market consensus of how much free cash flow the retailers could earn, discounted by their cost of capital. There are indications that the shopping spree may be ending soon. Last week, Walmart said its U.S. consumer spending started the year strong, but that it expects households to back off through the year, producing weak fiscal-year U.S. sales growth of 2% to 2.5%. Home Depot said consumer spending is holding up, but that it expects a flat sales-growth year overall, with declining profits. This is a troubling signal. Retailers are supposed to benefit the most from growing consumer spending, but their stock prices have been losing steam in February. As of Friday, Home Depot ( NYSE:HD ) has a year-to-date return of -6.1%, while Walmart ( NYSE:WMT ) is mostly flat (-0.8%). Other retailers with declining stock prices include Dollar General ( NYSE:DG ), -13.2%; Walgreens Boots Alliance ( NASDAQ:WBA ), -3.7%, and Casey’s General Stores ( NASDAQ:CASY ), -3.8%. Walmart reported Q4 and FY2023 (ending January) revenue growth of 7.3% and 6.7%, respectively. Its operating income fell 5.5% and 21.9%, for the same periods. Digging deeper into Walmart’s earnings release, I find that it keeps sales growing by expanding its grocery business, but those sales are less profitable than general merchandise categories, where consumer spending is leveling off or shrinking. In theory, the growth of the biggest US retailer could be attributed to one of the following: • General growth of consumer spending (economic expansion); • Good business strategy and market share growth (economic trend unknown); • Consumer downgrades spending from department stores (economic downturn); • Price increases (inflation). My interpretation: 1. Consumers tend to keep up with the same living standards. When inflation hits, they maintain the same purchasing habit. Higher price drives spending growth. 2. As inflation deepens, consumers get fewer merchandises with the same budget. 3. Consumers downgrade purchases from department stores to discount stores, and switch to generic products from brand-named products. 4. In a downturn, higher-ended stores get hit first, and discount stores get hit last. While Walmart manages to grow revenue by doubling down on grocery and online businesses, the weakness in general merchandizes uncovers the real trend of consumer spending leveling off. We may disagree on whether a recession will be coming, however, data from Walmart and Home Depot indicates that the U.S. retail sector is in trouble. S&P Retail Select Industry Index S&P Retail Select Industry Index may be a better benchmark for the U.S. retail sector, comparing to the lagging government data and company specified performance metrics. The index comprises of stocks in the S&P Total Market Index that are classified in the GICS retail sub-industry. Total-10 constituents by index weight are: • Carvana (CVNA) • Wayfair (W) • Sally Beauty (SBH) • Stitch Fix (SFIX) • Boot Barn (BARN) • Children’s Place (PLCE) • Qurate Retail (QRTEA) • Leslie (LESL) • EVgo (EV) • Abercrombie & Fitch (ANF) One-year chart above shows that CME E-Mini S&P Retail Select Industry (SXR) Futures tracks the trend of S&P 500 but illustrates higher volatility in the first two months of 2023. Each SXR contract is notional at $10 times the index. At Friday settlement price of 7004, one March contract (SXRH3) is valued at $70,040. Each futures contract (long and short) requires an initial margin of $5,700. When the underlying index moves 1 point, trader’s futures account would gain or lose $10. At present, I do not foresee a decisive trend of the S&P 500. It could trend up, go down or move sideways depending on how the Fed rate hikes, inflation, unemployment and geopolitical crises play out. However, this does not prevent me from expressing a bearish view on the US retail sector. Establishing a SXR short futures position would be appropriate in the negative outlook. 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
SShort
by JimHuangChicago
How to Chart Fed LiquidityI'm going to be clearing out some of my half baked ideas. I don't have a lot of time to write full ideas about them so enjoy the charts and feel free to ask any questions about them if you have any. I'm going to integrate my TV charts into the website with a daily, weekly, monthly analysis. website is in my TV profile or find me on twitter. ----- The Fed Liquidity used in Master of Markets Idea What is Fed liquidity? To determine Fed Liquidity you can simple use this ticker FRED:RESPPANWW-FRED:RRPONTSYD-FRED:WDTGAL The Total Assets of the Federal Reserve Balance sheet at 8.382 Trillion. Subtract The Treasury General Account at 451 Billion Then Subtract the 2.142T Overnight Reverse Repo You get 5.789 Trillion in Net Liquidity which hasn't come down a heck of a lot since the last time I tallied up 5.9T
FRED:RESPPANWWEducation
by SPYvsGME
2
TREASURY YIELDS AND THE FED FUNDS RATEThis chart shows the effective federal funds rate in comparison to the 30 year and 3 month yield over the past five years. There are 5 interesting times to look at: 1. Late 2018 long term yields began to peak right before the fed stopped their hiking cycle. Yield curve began to flatten. 2. They then stayed put for about 6 months with the 3MY hovering right around the EFFR. Suddenly, the 3 month yield dips below the fed rate quickly - and they begin dropping their benchmark rate again . 3. Early 2020 the panic of the COVID-19 pandemic caused rates to nose dive and the fed to slash their rate all the way to 0% very quickly. 4. Fed did not raise rates for two years . In early 2022 they began to hike for the first time since 2018. This also coincides with the beginning of the Ukraine conflict. 5. Half a year of steady rate hikes makes it so the EFFR finally passes it's 2018 peak in mid 2022. The 30Y and 30M invert fairly soon after while the fed funds rate overtakes the 30Y yield. Feel free to discuss what you think of these relations and what your predictions are for the future. In my opinion, the more the yield curve inverts the more problems there will be in the financial system. Eventually, term risk will not outweigh the high short-term yields especially once the benchmark rate gets over the inflation rate. I see the fed doing what they are best ate - acting too late.
FRED:EFFR
by Seth-Goldberg
USDJPY: Increase expected but watch end of week JPY FundamentalsAs we see the DXY continue to push up thanks to the fundamentals and potent9ial for a 0.5% rate hike, I'm expecting this pair to continue to push up. Key fundamentals out of Japan this week with inflation data on Thursday, there's also a speech on Friday by incoming Governor Ueda, not expecting policy comment, but if we get some it will likely have an impact on USD and JPY pairs. Depending on the DXY this week, and some weakness I'm expecting to continue for JPY based on JPYWCU, I'd expect we may reach the 137.5 region / where the 50MA and 100MA look about to cross, and then a drop / retracement. We saw a bearish pinbar on the daily on Friday, which does suggest a drop first, however I think this could be misleading due to the USD sell-off on Friday ahead of the long weekend. I'll be getting in with a bullish indicator on a LTF, and then out around 137 or end of day Thursday (ahead of the JPY CPI), whichever comes first. Whatever I expect volatility at the end of the week for this pair, it could drop very quickly with the fundamentals so I'll trade carefully and book profits!
Long
by Finchcliffe
1