SPY - Volumes fell off on Decline

25 août 2022

Many Sellers (Bears) missed the Selloff, and many Buyers (Bulls) failed to take profits at the 199 EMA tap.

Frustration abounds and will remain leading to many emotional trades being placed for both sides.

Indices traded into the Lows of their ranges and held for 3 days.

Buyers need a TOSS to get things going to the upside for 420+.

Buyers need to not hear Powell so much as mention QT. This needs to be avoided with Rates the primary
focus. Should he deviate into Quantitative Tightening - all bets are off.

We see the rounded lows in the 1 Hour Chart and the Couuntertrend channel - now we simply see if the
throw over short squeeze (TOSS) holds on GDP.

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After yesterday's -1175 NYSE Tick @ 12:15 PM EST - doubts began to arise once again.

The SPX dragged everything lower in several minutes. Volatility intra-day spiked and created further
uncertainty.

4164 was the Key Pivot for the ES - the front run 4162. During Globex, it crushed this level by 21 Handles.

NQ Pivoted over the Ghost Level @ 13013 during Globex.

Tesla crossed the $300 Level with New POs for 2022 $333 to $425 issued by Investment Banks.

NVDA had issued enough forward warnings to be mildly impacted after issuing its EPS / Guidance.

Debt Forgiveness in an Election Cycle is purely Political theatre.

Powell is due to provide clarity on his position through September tomorrow beginning at 10 AM EST
during a day of very heavy Macro Data.

Fundamentally - it will be an extraordinary day for trading, so best of trading in advance.


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Of Concern:

2YY - 2 YEar Yield Futures are approaching 3.5% - for now and again this is the power of Now - The
Effective Federal Funds Rate is 2.53%.

The 2 Year is getting close to pricing in a 100 Basis point Hike.

DX/DXY remain in a structurally sound uptrend, pullbacks are quite normal. Until the EU issues its
next rate decision on September 15th - the DX is free to roam about. It is important to acknowledge the
prior Highs were bested... this is important as it implies the 112s will be arriving in the near future.

Although the 10 Year is being permitted to lift in assisting the Yield Curve's reduced inversion, it's frankly
not a material concern as Yields continue to rise across the Curve.

FX Traders took the 6E (Euro) downtown below Par due to Economic conditions and not Rate Parities.

The NatGas to Crude correlations are disturbing - $410 - yesterday the Media upped it from $520 to $1000.


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Patience into Powell will be the best Trade imho.

Good Luck, the Bigger setup is 25 hours away ;)

25 août 2022

Note

Inflation - thebalance.com/u-s-inflation-rate-history-by-year-and-forecast-3306093

26 août 2022

Note

Minimum Student Loan forgiveness estimates @ 500Billion now.

Total Debt according to CRS is $1.6 Trillion. The Factual baseline estimate is $1.7 Trillion across the total pool of student loan debt balance is $37,667 or $1.711 Trillion.

It is important to note these are Government statistics. Actual Debt

15 Million people owe $10,000 or less - $150 Billion.

21 Million people owe $10,000 to $50,000 - $525 Billion

9 Million people owe $50,000 or more - $450 Billion @ $50,000

Appears to be quite low.

45.4 Million borrowers who took loans prior to July 2022:

1. Extend repayment moratorium for 4 months after a 2.5 Year pause.

2. If you made less than $125,000 in 2020 Debtor receive for $10,000 in Loan "Forgiveness"

3. Debtors who took Pell Grants - receive for $20,000 in Loan "Forgiveness"

4. GSL's are Taxpayer Backed - Taxpayers get the Bill.

5. 91% of respondents when polled replied - it was not enough.

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Conservatively, lets assume 50% of the 40 Million quality. 20 Million is quite low in Fact, well below the estimates that 88% qualify.

20,000,000 x $10,000 = $200,000,000,000 or $200 Billion.

Pell recipients estimated to be of the 50% - as a conservative baseline.
In Fact the percentage is far higher of the total Debtors of 40,000,000.

20,000,000 x $10,000 = $200,000,000,000 or $200 Billion.

$400 Billion in SUM, by Government Estimated which range from $375 Billion to $500 Billion.