Price, Price Spread, Lagged Price/Volume Spread, and Binary Price/Volume Indicator
Price and Total Volume With 50-period Moving Volume Average
Fibonacci Price Scale With Targets
It seems financial media gets fixated on what the current hot thing is ( war, crypto, AI, interest rates, inflation, political chicanery, or whatever), but it almost always seems to ignore the 30,000 foot view of the financial market and fiscal circumstance battlefield. Things like:
Higher interest rates deteriorate the value of a banks asset holdings (bonds) which those banks have done nothing about while interest rates continue to climb, making the situation WORSE than it was before, ergo Moody’s ratings drop. As a famous local rock radio station actor would say after reading that, “DUH-HUH!”
The PRC’s export trade deteriorated again in July, once again showing that China’s economy still struggles to overcome Chairman Xi’s heavyhanded lockdowns and other woes (like infrastructure collapse and high youth unemployment). The more uncomfortable the economy becomes for the citizens, the more war could be the distraction needed to keep them from fighting the nation’s leadership.
Fed speak beginning at 0815 EDT will probably address banking issues, but one wonders if it will simply be a mea culpa for the past decade or more of low or zero interest rates in the USA, which has distorted all U.S. markets and particularly in commercial and multi-family real estate.
Hopefully, our elite leadership will stop the “stupid is as stupid does” posture and fully address these issues, but leaders and markets tend to “ignore the burning building” until the flames consume it all.
Let’s just go back to the charts.
If MNQU23 can remain above 15412.25, it probably can rally back to at least 15461, and if it can overcome VWAP resistance at 15465.50 and 15488.50, there is a lot of space free of commercial holding and prices could rally to 15498, and beyond to 15524.50 and even 15558 by Wednesday.
If not, it should be a rather quick trip, given the lack of commercial holdings below 15401, for MNQU23 prices to fall back to 15374 and 15341 by Wednesday. Again, trader and institutional reaction will drive the bus to higher prices or to lower prices. For now, the path of least resistance seems lower, but all you need is a spark in news or some other event to drive the manic buyers back into the fray. Only time will tell.
I picked off 42 NQ points short on a bearish breakout from an hourly signal, and closed the platform to take care of other things late yesterday morning.
We will see what happens today. Have a wonderful Tuesday everyone!
Today’s Economic Data Courtesy of Trading Economics dot com. Be sure to refresh the date at the top left.
