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
The Fed continues to consider freezing rate hikes as “financial market tightening” has supposedly done its work for it. Even as that occurs, investor Stan Drukenmiller is betting that yield curve steepening that occurs before a recession hits will happen again. This can be seen in the linked chart.
This my personal opinion only, but if inflation is really under control, how can autoworkers gain 25% wage increases and not expect financing of autos to be approachable to the American middle class? We were looking for a 2% annual inflation target, were we not? Auto finance is becoming a train wreck. Remember what I mentioned in that Investopedia article yesterday. If prices increase sharply, GDP goes up sharply, even if production is reduced because of demand. One can price oneself out of economic prosperity, and that the Fed could be politicizing rate increases and not really looking for or focusing on the “Main Street” level inflation problems. Between rent and transportation, how can anyone afford to eat?
In other items, China’s PMI dipped unexpectedly, casting a pall over its economic recovery post-lockdown. Does that increase the likelihood of a desire to reclaim Taiwan as a diversion to economic woes? Only time will tell given current world tensions.
That issue is seemingly not worrying Intel and Samsung, as production and sales of semiconductors are improving as political tensions seem frayed around the world. 2024 could be a time of great change (for good or for bad) in the semiconductor industry, depending on the action of nation states like the USA and China.
Our JOLTS and PMI will give us a window into whether the US is teetering on recession or perhaps hanging on. When I know people who are working three and even four jobs, the prices of standard items, cars, housing, and food are insanely high and continuing to rise, it seems a bit tone deaf that the WSJ is so jubilant. We will soon see if economic nirvana or the gotterdammerung is next.
Let’s just focus on the charts for a moment.
If MNQZ23 remain above 14421, it has a high probability of rallying above the 14503.50 swing high to 14555.75 and 14622.25 by Thursday. If not, it could very possibly fall back to support around 14421 or 14343.75, and failing that, rather quickly pull back to 14311.25 and beyond to 14259 and even 14192.50 by Thursday. Once again we are in a region of trading activity that contains a dearth of commercial holdings above and below the current price action levels, so opportunity exists in both directions for potentially dramatic moves, and anything can happen.
I picked up 12 NQ points long per contract yesterday, and quickly shifted gears to other business. I want to watch volume early in session and before 1400 EDT when the Fed announcements hit. If trading is steady and robust, I may trade, but if volume becomes squirrelly and algorithm-driven, I may stand aside as I have a lot to do today.
That is it for me today. Go make money and make someone happy today!
Today’s Economic Data Courtesy of Trading Economics dot com. Be sure to refresh the date at the top left.
