FEDFUNDS | Too Tight

akikostas Updated   
The point of TradingView (and being a human/trader in general) is to learn from your mistakes. I did make some mistakes. Perhaps this idea by itself is another mistake. But I cannot do any different. I must speak out about what I see.

For the past year I tried to understand the pressures that are pushing prices higher, equities lower.

It is important in analysis to avoid the mass, the "common truth".

We all have expected a future of uncontrollable inflation, extreme prices and The Great Reset. The place where everything is too expensive to buy, and we will have to live with coupons.

While some of these may come, it is important to analyze what isn't coming.

Oil prices have been paired with the dollar (with the petrodollar).
Many expect oil prices to explode even further, while "dollar is losing value" and "hyperinflation is imminent".

Some charts however show a different picture...
WIth the 2M chart warning of downward swing, and with the 3M chart showing divergence, the future of oil may not be as explosive as we may believe.
But that is in relative terms. The strength of money seems fated to increase a lot more. Which in relative terms will constitute oil cost to be viable.

In the main chart, it appears that oil is moving into what appears to be a Wyckoff Distribution.

And oil is not the only one who will have trouble with the high-yield environment.
Until now, the usual equity-bond investment scheme has performed tremendously.
This trend is now changing. With a significant trend violation that occurred last year, it seems that we are entering a new period of investment strategies.

From bonds as a hedge against equity weakness, investors should seek alternatives.
The old way of doing things is broken. Commodities will be playing a significant role in the future of investments.
It is in our power to find the new way of doing things.

Tread lightly, for this is hallowed ground.
-Father Grigori

P.S. A link to the indicator I am using.
Perhaps over-tightening is the only way to go.
Chart: Wheat / Oil price
Oil prices will get much too high for farmers to survive.
A long-term chart of oil vs yield rates.
Short-term horizontal movement can be expected for the pair.
Crude Oil Spring incoming?

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