Hello!
Jerome Powell has official halted the interest rate hike for the months of June and July, pause; before we celebrate, he indicated in his speech that there were likely 2 more rate hikes incoming by the end of the year, signalling that the US fight against inflation was not yet over. The US inflation rate has dropped to 4.03% signalling relatively positive efforts of interest rate hikes. The US will likely aggressively chase their pre-covid average of about 1.5-2%.
As of now, I am definitely bearish on the market at least until August with today's drop signalling common market sentiment. Nonetheless, I would rather take a low-mid risk trade on a potential pullback long. At the moment we are in a free fall and will likely eventually see accumulation in the near future. Oddly enough, I do not expect the market to break the $46 level of support that formed near the start of the last bull run. Even through all the seller, CMO momentum indicator indicates medium level sellers at most, so I don't expect to rush into this trade.
For now, I have set sights on a long as per the chart and a short at the peak of support. The MTF Block Indicator which I took off the chart to assist clarity into analysis, had also indicated a large OB of shorts between 59-61. This translates to the lack of investor confidence in breaking through resistance levels and establishing higher highs, thus, for now I have shorts placed at the exact levels of TP for my long.
Overall, lets exercise a degree of prudence as the markets move with a clouded uncertainty.
Jerome Powell has official halted the interest rate hike for the months of June and July, pause; before we celebrate, he indicated in his speech that there were likely 2 more rate hikes incoming by the end of the year, signalling that the US fight against inflation was not yet over. The US inflation rate has dropped to 4.03% signalling relatively positive efforts of interest rate hikes. The US will likely aggressively chase their pre-covid average of about 1.5-2%.
As of now, I am definitely bearish on the market at least until August with today's drop signalling common market sentiment. Nonetheless, I would rather take a low-mid risk trade on a potential pullback long. At the moment we are in a free fall and will likely eventually see accumulation in the near future. Oddly enough, I do not expect the market to break the $46 level of support that formed near the start of the last bull run. Even through all the seller, CMO momentum indicator indicates medium level sellers at most, so I don't expect to rush into this trade.
For now, I have set sights on a long as per the chart and a short at the peak of support. The MTF Block Indicator which I took off the chart to assist clarity into analysis, had also indicated a large OB of shorts between 59-61. This translates to the lack of investor confidence in breaking through resistance levels and establishing higher highs, thus, for now I have shorts placed at the exact levels of TP for my long.
Overall, lets exercise a degree of prudence as the markets move with a clouded uncertainty.
