The DJI is approaching an all time high of about 278400. This market has become pretty volatile mostly at 30 - 50 minute charts.
Although the DJI is pushing north madly, it is a market that is being moth eaten. It's instability is likened to a Jenga tower. The instability is also seen in trend switches down to the 5 minute level.
Nice video buddy. Been long on this since beginning of last week. Most people I know shorting this. Free money.
SpartaBTC
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We are ahead of the financial crisis. Dow Jones and Fed Rate% April 23 published.
Captain_Walker
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@SpartaBTC, I don't understand what "Dow Jones and Fed Rate% April 23 published" means. I understand the words, but what are you referring to? Why is April 23 (of which year) important?
Captain_Walker
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@Captain_Walker, Ok.. I see your post on that of April 23. Reading it now.
Captain_Walker
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@SpartaBTC, 'The financial crisis' (FC) means different things to different people. Is there one at the moment? Probably not. It depends of course on which perspective on takes. Any sort of FC is not strictly about the DJI. My idea is that FC is more to do with the underlying economy and money markets of various types. The DJI to my mind is a representation of confidence in the economy. But that is deceptive in many ways.
The big so-called investors (being corporations and banks mainly) are employing HFTs. The HFTs live for time frames between 1 to 5 minutes. HFTs piled on top other HFTs push markets either up or down to a degree that should not normally happen. So I'm thinking much of the moves in the DJI are HFT-magnified.
Add to the above, what the FED is doing. They're printing more money and relaxing interest rates. That's great news for the big boys and their HFT's are more likely to go into overdrive. REPO markets have been pumped by the FED - they say that's now fixed. What's all the REPO money doing overnight (which is what the REPO pawnshop is about)? Strange that when I read about this, only vague general terminology is used. Nobody actually says, "They're buy stocks, bonds and other stuff like that overnight with HFT's, milking a loadah money and then paying back the next morning while walking off with profits." - but that's what it is about.
From a Technical Analysis (TA) point of view, it would appear that price is consolidating on the weekly DJI and getting ready to bust north. Supporters of a pure TA approach say that all variables are considered in the market. I don't think so because for the DJI, magnifications of value are predominantly fakery caused by computers (not many real people in there). I'm not doubting where price is. I'm doubting the reality and stability of price.
There are some fundamental factors that are papered-over by HFT and other effects on the DJI. These are:
1. US Debt at $23 Trillion with a debt:GDP ratio of 67% (not the highest in the world).
2. Derivatives debt (off-book) at an estimated $233 Trillion.
3. Massive defaults on loans of many types in the American economy.
4. Employment figures (in the unemployment rate) based on U3 figures instead of U6 - and then U3 massaged (aka corrected) up or down. Note also that extremes of unemployment also have nearly always followed recessions.
(continues below....)
SpartaBTC
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@Captain_Walker, I think you have provided a lot of arguments. In my opinion, the higher the price is raised locally now, the sadder it will be in the future.
Captain_Walker
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@SpartaBTC, Tradingview weeded out my continued post simply because I posted a link the the Federal reserve data. How sad? I draw no conclusions. So here it is continued without the link.
5. The inconsistency of the FED using QE in an economy that is doing so well - according to them an POTUS. I'm aware of the FED's reasons. I nor anybody who has studied this, buys the FED's reasoning.
6. The 3-10 yield curve was inverted for >3 months - a classic reliable signal heralding recession over the last 50 years. Now that it is un-inverting there seems to be celebration. However, the signal also includes uninversion of the 3-10 yield curve. Time lags to recession are traditionally estimated in terms of months to about 2 years. The start of a recession is always discovered in hindsight.
7. Several trade wars globally in progress. China steals the spotlight and it is not a 'complete deal' done as Mr Trump said he wanted (all or nothing). Now POTUS is about to accept a 'phase one' deal which is a partial deal, and nobody knows how many phases it will take to get to full deal. And what happens if we get to phase 12 and 'no complete deal'. If Trump is still in power, is he just gonna tip over the table and say 'Sorry folks, I said complete or no deal - game over'? I don't think so. The several trade wars are part of the global economic cycles. The IMF and other bodies have warned about this and the ill-effects of protectionism.
8. On the probability of recession itself the FED estimated probability was ~35% at 3rd October 2019 (for Sept 2020) (hyperlink to hard data removed). The FED's own estimates around that sort of figure, have usually 'predicted' previous recessions. So to avoid a recession next year, they FED has to work some serious magic against the statistical odds, all the trade wars and the global economic cycle. How strange that popular media have not focused on these estimates. In the face of all this data from the FED, the DJI is pumping north like nobody's business. A human being of sound disposing mind would be a bit more cautious. But as I said it's not about human beings, it's about computers programmed to magnify the human emotions of hope and greed. Isn't it strange that questions put to Powell are such a light touch. I think so. Most people do not ask questions that dig deep into FED data.
(I'm not saying that a recession is a financial crisis - though it may be the result of it).
All of the above may not be relevant to day-to-day trading, which for my methodology is about microtrends - not even daily or weekly trends.