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
Yesterday’s GDP data was a bit higher than expected, but, given the fact that the American consumer is tapped out and inflationary pressures make rents and cars unaffordable, there are questions as to how long that can last. The WSJ takes a very pollyannish view at headline level, but another WSJ commentator takes a more cautious view.
The folks at Game of Trades are certainly cautious about the inflationary pressures I mentioned above, and their also worried, as I am, about the increase in Federal debt, which could create serious economic problems, particularly as nations like China are quickly selling U.S. Treasury bonds. (I do not endorse nor do I benefit from subscriptions offered at the end of their videos, I just like their basic macroeconomic analysis).
Beyond economic woes, the USA seems intent on escalating a tinderbox of an international conflict by taking out Iranian-backed military installations in Syria that have been firing on U.S. positions. China’s last reformer, Li Keqiang, has died. Not sure if that will bring any public protest of Xi’s policies, but he was respected by many in the PRC.
There are a myriad of topics I could cover, but let’s just look at the charts.
Amazon’s earnings were solid, but even good news on Amazon and GDP could not stop the selling in MNQZ23 yesterday, but traders in Asia and Europe slowly began to buy back the contract. If MNQZ23 can rally above the 14317 VWAP line, then it has a chance of recapturing 14459.25 and 14472.50, and if buyers continue the pressure, it could eventually regain 15547.50 and even 14656.75 by Monday, if buyer become aggressive. The gaps in commercial holding are wide enough to allow that.
If not, you are likely to see another test of 14231 and 14136.50, the most recent swing low. If that is broken then 14048.75 and even 13938 are possible by Monday.
PCE (personal consumption expenditures) data, personal income and spending data, month over month, come out today, and that is one primary gauge of inflation. That could have a measured effect on volatility, but with all the craziness that has hit over the last 10 days, it could mean that traders may make major moves before the close today, and then basically wait until next week to reposition. We will simply have to see what happens.
I picked up 11 NQ points per contract short yesterday based on the initial breakout target and then walked away to other business. Volume accelerated shortly after that, and basically did not let up until the afternoon was over.
That is all for me today. I hope you have a wonderful and productive Friday. I will try to do a short review of the week by Sunday. I have lots to catch up on after my conference trip last week. Thanks again for supporting this Substack!
Today’s Economic Data Courtesy of Trading Economics dot com. Be sure to refresh the date at the top left.
