Page menu

Thursday, March 23, 2023

The FOMC fallout in forex markets & the Crypto Crackdown

 There's a hellofalot to cover this morning, so I'm just going to throw a lot of spaghetti at the wall, and see what sticks - hopefully I can sort most of this out, in the next few days.

My proof reader is also away so you're probably going to find some misspelled words, and typos.

The FOMC fallout in forex markets & the Crypto Crackdown 

You may not think forex, or crypto markets affect your trade, but everything is connected. 

Firstly: The Fed did what was expected - raising .25 basis points - and I believe the only reason they did it, is because they know they must defend the almighty petrodollar. 

3 weeks ago:

Russia Turns to China’s Yuan in Effort to Ditch the Dollar wsj 

12 hours ago: 

Putin, Xi Vow to Use Yuan as Russia and China Move to Settlements in National Currencies bitcoin.com

This morning: 


Lindsay Lohan, other celebs settle with SEC over crypto case apnews.com


"LOS ANGELES (AP) — Actress Lindsay Lohan, rapper Akon and several other celebrities have agreed to pay tens of thousands of dollars to settle claims they promoted crypto investments to their millions of social media followers without disclosing they were being paid to do so." (story continues) 

Also This Morning 

U.S. SEC threatens to sue Coinbase over some crypto products reuters


Didn't I tell you they were going to go after Crypto, and I think this is just the beginning!

  Silver  

Speaking of alternate currencies, I think there's a good chance precious metals get taken down here! 

I don't usually pump other people's trades, but this deserves some attention!


  $SLVP Silver miners 

If this is indeed wave 5, the next shakeout could be devastating! 


Getting back to yesterday's Fed's announcement, and more importantly, the market's reaction to it. 

The market seemed to over react, as or was that a bear raid, or an actual reversal? Looks like a reversal, walks like a reversal.

$SPX 15 min. chart view updated from yesterday



 We see the market recovering somewhat this morning, and I can't confirm a bearish reversal, after only 1 hour of selling. Still I would err on the side of caution. 

 To be honest, the market action left me a little spooked, and I don't spook easily.

I even went so far as to liquidate some losing positions, further diversify my portfolio, and hedge myself a little better. Come what may, at least I'm not going to be wiped out... 

It wasn't until the final minutes of the trading day that we saw the selling accelerate, but it really started with a gap down on the $USD.... 

The FOMC fallout in forex markets

The DXY ($USD index) is what really spooked me 

I pinned down what was going on in the DXY chart, and put out a dozen tweets, but then I went back and deleted most of it. That's one of the nice things about Twitter, you can delete information... 

Wasn't I just saying investors seem to be fleeing the $USD?

I've also been anticipating the same ol', pump 'n' dump trade in tech, and low and behold, that's exactly what we saw. 

Emerging markets initially rallied on the News, but that also rolled over, and gave it all back... 

We're also seeing our favorite contrarian indicator pump the NASDAQ, and that's a red flag warning. 

“Short this [N]asdaq and invite me to your funeral,” Cramer warns in a recent tweet. 

That kind of arrogance scares me. You would think Cramer would lay low, after getting the regional banks so wrong! I'm surprised CNBC isn't named in a class action law suit!  

Let's go to the charts: 

Biotech

I thought I was seeing a bullish setup on the biotech chart... 

Of course that chart pattern was obliterated, just an hour or so after I alerted to it. 

Taking another look at it, it seems to have traded into the lower end of a larger bullish pattern, and that points to the hedge funds attempting to shake the weak hands out. 

$XBI - I may not like Jim Cramer's NASDAQ, but I do like this sub-sector (biotech)! Bulk buy!

 


 The S&P $SPX 

This index actually closed on a bullish note, that's why you see buyers stepping up, this morning.  

As I explained to some Newbie - I ran across on Twitter - as I was updating the charts: 

The market definitely has a lot to prove here, and I suspect we could take at least another day, to build a base. It's too soon to say.... 

$NYSE - Yeah, nobody trades this index, but it's a good representation of the broader market, and because it's not watched by every trader on Wall Street, it's not being manipulated like the $SPX. 

You don't see the $NYSE trading above the 200 day moving average. In fact it was sold there! 

The Dow Jones 

$INDU - I'm a firm believer in not fighting the trend 



Furthermore the $VIX bounced out of the hole, at the 20 level, and that was enough to spook me. 

As far as my bold prediction on the $SPX goes targets can always be revised lower:



Take Care, 

AA 



Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)