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 world seems bent on war, and it seems even China sees soft resistance to the heavy-handed leadership of Xi Jinping.
We found out yesterday that Purchasing Managers Index contracted again for the 11th consecutive contraction in a row, as borrowing cost of rate hikes have made financing manufacturing a difficult thing in the USA. In similar fashion, it appears that permanent job losses are also accelerating.
It does seem like the economy continues to bend toward recession, financing is tight, but the Fed continues to print money mindlessly under the direction of a spendthrift Congress, and it’s leaders believe it can fund anything including two wars (which could soon become four wars) , even though the Federal debt continues it’s asymptotic climb above $32 trillion dollars.
I am not a huge fan of CNBC (what I call complete nonsense broadcast continuously) . Occasionally, however, they bring in great guests like Stan Druckenmiller who sees things clearly with a longer time frame of analysis. He has in the past been critical of Janet Yellen and Jerome Powell, and he was on fire about our drifting into an endless debt spiral. He basically stated that Janet Yellen made the worst mistake in U.S. Treasury history by not securing low interest debt in 2021, which lead the U.S. into its current debt crisis.
Stan Druckenmiller’s comments on the debt crisis are located on these links, here and here. His key points are the expenses (mainly entitlements) need to be throttled, and that debt accumulation must stop. He also makes the point that there have to be positive capital hurdle rates ( real, above-zero, “risk free rates of return) to end the creation of zombie companies that populate the Russell 2000 and that account for the index’s poor performance. The loss of hurdle rates is the reason I gradually left the buy-and-hold universe, as I could see the day we have today coming 15 years ago. If you cannot accurately measure risk on a cash flow basis, you do not know what the terminal value of any investment is. Ask anyone who held GE 0.00%↑ until it cratered if that mattered. That cratering could be market-wide soon if we do not stop the endless borrowing, take care of American domestic problems, shore up our currency (including backing it with some kind of commodity basket) and reclaim a balanced ANNUAL budget. Pensions and entitlements WILL suffer under this arrangement, but in the long run, financial stability will protect future American generations if we can hold this country together.
Let’s leave these issues for now and head to the charts.
If MNQZ23 can rally above the 14861.75 VWAP line, it has an excellent chance to cut through other VWAP lines to take out 14887.75 and perhaps 14977.25 by Friday as there is once again a relative lack of commercial holding that those proce levels. If that does not happen, it could be an easy push back against those compressed VWAP lines at and below 14769.50. There is some support around 14677.75, but failing that it could be short trip back to the swing low of 14558.25, and beyond to 14488 and 14398 by Friday if sellers become aggressive again.
I could not get to the desk in time ( as I was exercising) to catch the first breakout, but after 10 AM I was able to capture 22 NQ point profit long per contract to the expansion target. As I continue to scale I will leave contracts on and let the drift either back to breakeven, or to a rather lofty gain one could have achieved yesterday had those contracts been left in place.
That is all for me today. I hope you hit all of your Thursday goals today!
Today’s Economic Data Courtesy of Trading Economics dot com. Be sure to refresh the date at the top left.
