I will have to delay part 3C of “Setting Up The Trade” to fix some pressing software issues for another business. I should be back on track next week to fulfill that obligation to readers. Stay turned.
If you can, please watch the video concerning MNQZ23. The real discussion of a bearish monthly projection begins at 0:43. The bullish monthly proection at 7:46. The daily bearish projection is discussed at 9:09.
The only decently accurate projection with the current data is the bearish one, shown here on the monthly chart:
We have established pivots for that on a monthly basis, even though at the end of the month (09/29/2023) that monthly candlestick bar closed above that pivot in broke during that month. If volume continues to track negatively in future months and the 13804 VWAP is not taken out to the upside, then this could be the result as long as price symmetry holds up.
There is a bullish outcome should 13804 hold (though we have not yet established a price pivot just yet):
This would be a possible bullish outcome should support hold at 13804 (which of course, we have not yet confirmed). There are possible bullish outcomes if the Fed continues to print money and the Fed decided to cut rates and inflate forever (though I think that will come to a bad end, as I will discuss briefly later in this post).
The other possible outcome on a daily chart, would be a three-drives-to-a-bottom pattern on a daily basis. Since pivots have yet to be established on that final leg, I left the prices out, but if downward pivots are established, this too could be possible outcome as MNQZ23 seeks to find price support.
To understand, at least from the framework of interest rate policy, this Game of Thrones (GOT) video does a decent job of showing what all U.S. equity market products (including MNQZ23) face in coming months and years. I do not endorse their products nor am I paid by them, I just like a lot of their broad-based analysis.
While this video is used to describe the “inflation biased” tilt of central banks, I think the Game of Thrones folks are incredibly naive in their analysis of “boom and bust” cycles. The reasons are as follows:
The GOT crew conveniently ignored the formation of the U.S. Federal Reserve Bank in 1913, and outside of the debasement and removal of the gold standard that American presidents have engaged in, are largely responsible for the inflation and boom-bust debacles of the last 100 years.
The process of de-dollarization by competing geographic competitors in the East can at some point lead to the U.S. Dollar not being the stategic reserve currency on this planet. If that happens, the US Federal Reserve and the U.S. Treasury can no longer print money at will, and a horrible hyperinflationary spike would destroy this nations standard of living, practically overnight. We are now printing worthless fiat money to fund already bankrupt entitlement programs and sending money to protect other borders and government infrastructure (the most blatant being Ukraine) and leaving our borders totally undefended while the political class continues to pass pay raises and spend us into oblivion. (I am no fan of Politico, but trust me, the Unipary as it stands would have agreed to a pay raise if the Democrats had approved it, but given the loss of the spending cap in the last resolution, is Rep. Kevin McCarthy any different than Sen. Linday Graham, a stealth budget-busting statist?)
There is a war footing on now that will accelerate the move to world war, and a world war on several fronts. The U.K. is suggesting troops be sent to Ukraine for trainng, and Medvedev is warning the U.K. and NATO of consequences. The U.S. and NATO seem determined to sleep walk into a world war with the world’s most prolific nuclear weapons arsenal in Russia. Though Foreign Policy magazine (which is no a website) is no arbiter of American liberty, it does see the weakness we project around the world and particularly in China, where the PRC is amping up military training missions in the South China sea, right in “Taiwan’s grill”. If this continues, there is a two-front war we must face, and for which our Navy is not prepared to win. As I gather more information about this, I will add it. The last news story out of a “non-censored” search engine was this.
A lot is out there that the GOT group is ignoring, but anything can happen in the future. One must realize that there are more alternatives, both good and bad, that are possible. That is why I look at both sides of the coin before making a decision.
That is all for me today! I will continue the “Setting Up The Trade” series again soon! Thank you for supporting this Substack! If you liked what you read, please like the post, and if you want to subscribe I would appreciate it.
Have a great rest of your Sunday and a positive week next week!
