BRIEFING Week #34 : The Rotation may have BegunHere's your weekly update ! Brought to you each weekend with years of track-record history..
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Chart Patterns
Gold Weekly Plan: Daily FVG → H4 FVGGold closed last week with a strong impulsive move into a Daily Fair Value Gap (FVG). As we open the new week, I’ll be watching closely:
Daily FVG (3423–3451): Potential resistance and rejection zone early in the week.
H4 Bullish FVG (3390–3395): If price rejects the Daily FVG, I expect a retrace into this zone to set the weekly low between Monday and Tuesday.
From there, we could see a bullish expansion for the rest of the week.
The key question: Will Gold respect the Daily FVG as resistance before rebalancing lower, or will buyers push straight through?
What’s your bias going into the week? 🚀📉
Gold Deep Dive: Cycles, Correlations, Divergences, SymmetryGold has been in a raging bull market and almost up over 100% since its monthly bullish engulfing candle.
Gold sniffing out week monetary policy and rallying on the back of easing global monetary policy.
Historically from a trading standpoint, Gold is extremely overbought and could be 4-8 weeks away from a considerable pullback of 15-30% .
Many Signals such as symmetrical moves, Monthly overbought RSI, Copper / Gold Divergence, GDX resistance is telling us to use caution and trim long profits.
It does seem like gold wants $3500 before it has a reversal back down. We are looking for a liquidity sweep of the ATH as a possible short zone. (Not FA advice)
Once gold resets some indicators and allows longer term moving average to catch up it will likely keep pushing but we only for see that in mid to late 2026.
If we make a new high....we don't see much upside for the next 3-6 months.
Review(detailed) and plan for 25th August 2025Nifty future and banknifty future analysis and intraday plan.
This video is for information/education purpose only. you are 100% responsible for any actions you take by reading/viewing this post.
please consult your financial advisor before taking any action.
----Vinaykumar hiremath, CMT
GBPUSD DAILY ADVANCED STRUCTURE+SMA+EMA GBPUSD ,FOLLOW THE STRUCTURE and look into a possible double top structure and get ready for selloff. The fed federal fund rate will be holding a strong market sentiment and Tylor RULE might be applied during FOMC VOTING PROCESS.
Allow fed do their job and swing into action.
trading is 100% probability
think like a hunter
if you like this chart or have a divergent view come to the comment section and share your perspective respectfully.
GOODLUCK
GOD BLESS US DOLLAR .
#NIFTY50 upcoming week looks decidingNSE:NIFTY Nifty currently taking time to clear whether to fall lower or to float around between recent time lows and ATH. As explained their could be multiple possibility ahead. For time being we expect one more swing higher could make the recent time low a strong support at-least for few weeks encouraging some buyers to enter. Now if not made and the recent lows are taken could implicate further more correction in #NIFTY50. So we suggest to stay on sideline till further notice.
BITCOIN BTCUSDT DAILY CHART FOR FORWARD GUIDANCE BITCOIN ON DAILY is giving a different structure, the breakout of a demand floor and the retest has experienced twice retest from the structure.
FED rate cut ,hold or increase will come as a surprise due to matrix used in the voting and decision making by FOMC members.
FED CAN APPLY THE Taylor Rule if they want to.
The Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
this points to FED holding federal fund rate at 4.25% to 4.50% for a long time ,despite persistent pressure to lower fund rate like BOE,RBA BOJ ,RBZ have done this year.
if the current price of BTC doesn't see upswing dont complain because smart traders and banks have kept a secret away from public space.
ALLOW FEDS DO THERE JOB,DONT SPECULATE THEM.
#BTC #BITCOIN
THETAFor word requirements:
By Grok ~ Trading: An Overview
Trading involves buying and selling financial assets like stocks, bonds, commodities, or currencies to profit from price fluctuations. It’s a dynamic activity central to global economies, enabling wealth creation and risk management. Traders operate in markets such as stock exchanges or forex platforms, driven by strategies ranging from short-term day trading to long-term investments.
Successful trading requires understanding market trends, economic indicators, and risk tolerance. Technical analysis, using charts and patterns, helps predict price movements, while fundamental analysis evaluates an asset’s intrinsic value. Traders must stay disciplined, avoiding emotional decisions that can lead to losses. Risk management tools, like stop-loss orders, are critical to minimizing downsides.
Trading offers opportunities but isn’t without challenges. Volatility can yield high returns or significant losses. Leverage, while amplifying gains, increases risk. Beginners often face steep learning curves, requiring education and practice to navigate complex markets. Technology has democratized trading, with apps and platforms making it accessible to retail investors. However, competition with institutional traders demands sharp skills and continuous learning.
In essence, trading blends analysis, strategy, and discipline. It’s a high-stakes endeavor that rewards preparation and resilience, shaping wealth and economies worldwide.
Boom and Crash Strategy on tradingview – Smart Money ConceptTrading Boom and Crash indices can be exciting, but also very challenging. These synthetic assets are designed with volatility in mind. Boom creates sudden upward spikes, while Crash produces sharp downward spikes. For most traders, these spikes feel random, but when you understand market structure and timing, they actually make sense.
In this post, I want to share a detailed Boom and Crash trading strategy based on smart money concepts (SMC). This is not about chasing every spike or relying on heavy indicators. Instead, it’s about learning how the market moves, spotting liquidity traps, and waiting for the right confirmations before entering.
Why Boom and Crash Are Different
Unlike forex pairs or crypto assets, Boom and Crash follow an internal synthetic engine created by Deriv. This means:
They run 24/7 without downtime.
There are no external fundamentals moving them — only programmed volatility.
Spikes are built into their behavior.
Because of this, traditional technical analysis alone often leads to frustration. Many traders try to scalp spikes randomly and end up losing accounts. What works better is combining price action with smart money concepts to create rules for when and where to trade.
Core Elements of the Strategy
Here’s the step-by-step structure of the strategy explained in my video:
1. Liquidity Grab
Markets often move to take out stop-loss clusters before reversing. On Boom and Crash, this is even clearer — you’ll see price sweep recent highs or lows with a sudden spike. That’s your signal that the market is preparing to move the other way.
2. Supply and Demand Zones
Instead of chasing every candle, mark out zones where price previously moved aggressively. These are institutional footprints. When price comes back to test these zones, you prepare for entries.
3. Fractal Confirmation
Don’t enter immediately when price touches your zone. Wait for confirmation — such as a smaller structure break, rejection wick, or micro liquidity grab. This reduces false entries.
4. 1-Minute and 5-Minute Setups
The Boom and Crash 1-minute strategy is for scalpers who want quick profits, but I recommend checking the 5-minute chart for context. Using both keeps you aligned with short-term opportunities while respecting the bigger picture.
5. Best Times to Trade
Timing matters. Even though Boom and Crash are open 24/7, volatility has cycles. Trading during low-volume windows (when fewer spikes are engineered) often produces smoother moves and cleaner setups.
Example Setup
Imagine Boom 1000 is consolidating near a previous high. Suddenly, it spikes above that high, grabbing liquidity. Instead of buying the spike, you mark the supply zone left behind. When price returns to test that zone, you wait for confirmation (a break of structure on the 1-minute chart). That’s your entry for a short, riding the move down safely.
This method works because you’re trading with the market’s intention, not against it.
Risk Management
No strategy works without discipline. For Boom and Crash especially, lot size and stop loss make the difference between growing an account and blowing one.
Risk no more than 2% per trade.
Always set a stop loss, even if it’s mental.
Take profits at clear liquidity pools instead of holding forever.
Remember, consistency matters more than catching every big spike.
Why This Strategy Works
The beauty of this strategy is that it simplifies trading Boom and Crash. Instead of chasing random spikes, you’re reading the “story” of the market: where liquidity is, where institutions are positioned, and when the reversal is most likely.
It also gives confidence. Many traders hesitate to enter because Boom and Crash look unpredictable. With this method, you have rules:
Wait for liquidity grab.
Mark supply/demand.
Confirm with structure.
Enter with controlled risk.
My Journey With Boom & Crash
When I first started with Boom and Crash, I made the same mistakes most traders do. I tried scalping every spike, opening too many positions, and hoping luck would carry me. Accounts got blown faster than they were funded.
It wasn’t until I studied price action and smart money concepts that things changed. I realized Boom and Crash don’t need dozens of indicators. They just need patience, timing, and a structured plan.
This strategy is the result of testing, failing, refining, and testing again. Now it’s the backbone of how I approach synthetic indices.
Key Takeaways
Don’t chase every spike — let the market grab liquidity first.
Focus on supply and demand zones for cleaner entries.
Use 1-minute for scalps, 5-minute for context.
Trade during stable sessions for less noise.
Protect your account with strict risk management.
Final Thoughts
Boom and Crash can either be a trader’s nightmare or a powerful opportunity. It all depends on how you approach them. With a structured strategy based on smart money concepts, you don’t have to guess — you simply wait for the market to show its hand.
If you’re serious about trading these indices, I encourage you to watch the full video breakdown. It walks through chart examples, entry setups, and risk management in detail.
BITCOIN btcusdt DAILY PRICEACTION BITCOIN ON DAILY is giving a different structure, the breakout of a demand floor and the retest has experienced twice retest from the structure.
FED rate cut ,hold or increase will come as a surprise due to matrix used in the voting and decision making by FOMC members.
FED CAN APPLY THE Taylor Rule if they want to.
The Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
this points to FED holding federal fund rate at 4.25% to 4.50% for a long time ,despite persistent pressure to lower fund rate like BOE,RBA BOJ ,RBZ have done this year.
if the current price of BTC doesn't see upswing dont complain because smart traders and banks have kept a secret away from public space.
ALLOW FEDS DO THERE JOB,DONT SPECULATE THEM.
#BTC #BITCOIN
A penant in penantgold has been compressing for the past 4 months coming.
It's truly testing the patience of traders yes.
However, there's plenty of opportunity every single day.
Allow the market to show the sign after a breakout then follow it.
use proper risk management to allow us to control our acct.
Bias is bullish but we are in the area of rejections.
sellers can anytime to comes in.
4 Step Explanation: What Is the Short Squeeze Mindset?Silver (XAG/USD) BUY Setup – Short Squeeze Mindset in Action 🪙📈
Silver is one of the most exciting assets to trade. It’s volatile, emotional, and attracts both institutional players and retail traders. But that same volatility can
often feel like a trap. One minute the price looks ready to fly, the next minute it pulls back sharply — leaving traders frustrated and shaken out of positions.
This is why you need a structured approach to trading Silver. Today, I’ll walk you through how the Short Squeeze Mindset gave me a BUY signal on XAG/USD and how you can apply the same process.
What Is the Short Squeeze Mindset?
The short squeeze mindset is about aligning the bigger picture trend with short-term traps.
On higher timeframes (like the daily chart), you look for trend direction.
On lower timeframes (like the 4H chart), you look for pullbacks that suck in shorts.
Once momentum flips back in favor of the trend, those shorts are forced to cover — fueling a breakout.
This isn’t just theory. It happens all the time in volatile markets like Silver. And right now, Silver is flashing a setup.
What Silver Is Showing Us Now 🚀
Daily Chart: Silver just printed a green bar 🟩, confirming that buyers remain in control.
4H Chart: At the same time, a red bar 🟥 appeared, luring short sellers into the market.
Result: Shorts think they’ve found safety, but in reality, they’re walking into a trap.
This mismatch between the daily green bar and the 4H red bar is the exact pattern the Short Squeeze Mindset looks for.
The 4 Steps for Silver BUY Setup
Here’s how I break it down:
1️⃣ Rocket Booster Strategy
Always begin by identifying strong trending markets. On the daily timeframe, Silver is pressing higher, showing bullish continuation.
2️⃣ Momentum Trading Style
Momentum is not just about one chart — it’s about flows. Precious metals are catching bids in line with broader commodity strength. Silver is participating in that momentum.
3️⃣ Short Squeeze Mindset
This is where the magic happens:
Daily = 🟩 Green (trend up)
4H = 🟥 Red (pullback trap)
Shorts load in on the red bar, but they’re trading against the larger bullish trend.
When price flips back up, their stop-losses fuel the breakout.
4️⃣ Stochastic Overbought Zone
Most traders panic when stochastic hits “overbought.” But in a squeeze, this is confirmation of strength. Silver can remain overbought for extended periods when buyers dominate.
How To Trade This Silver Setup 🔑
Here’s a practical breakdown of how to structure the trade:
Daily Confirmation
Daily bar is green = higher timeframe bias is BUY.
4H Pullback Trap
Shorts are entering on red bar 🟥.
This is where patient traders prepare to fade weakness.
Entry Trigger
Wait for a bullish candlestick reversal pattern on the 4H chart:
Bullish engulfing
Morning star
Hammer
Enter after confirmation, not before.
Profit Targets & Risk
Take Profit 1 (TP1): Previous daily swing high
Take Profit 2 (TP2): Major psychological level (e.g., $30)
Stop-Loss (SL): Below the most recent 4H swing low
What This Means 🌍
Silver’s volatility is often seen as a weakness, but with the Short Squeeze Mindset, it becomes your advantage. Instead of chasing breakouts late or panicking during pullbacks, you’re using volatility as a tool.
This means:
You’re trading in line with the higher timeframe trend.
You’re entering when shorts are most vulnerable.
You’re letting trapped sellers provide the momentum for your trade.
That’s how you turn volatility into confidence.
Final Thoughts
Silver (XAG/USD) is setting up for a BUY based on the Short Squeeze Mindset. By combining the daily bullish trend with the 4H pullback trap, you’re positioning yourself ahead of the breakout — not after it.
This is the type of setup you want to practice spotting again and again until it becomes second nature.
🚀 Keep this play in your trading journal.
⚠️ Disclaimer: This article is for educational purposes only. Trading is risky. Always use proper risk management and test strategies on a demo account before trading with real money.
#ETHUSD Looking bullish and any panic is a buyBINANCE:ETHUSD Etherum after struggling for long time to break its ATH, has currently broked on 22nd Aug and 1:1 ratio suggest its heading towards 5700+ levels. Any panic which can happen can be bought in 3-7-11 swings for the target. Over all we love #ETHUSD
BASICS: CREATE A ZONE #Gold #Zones📈 How to Create a Zone for Trading
This video will walk you step-by-step through creating a trading zone.
The purpose of the zone is to help identify the current market trend for a breakout.
✅ Remember: Consider trading the trend for the best setups and opportunities.
#TradingView #ForexTrading #DayTrading #TrendTrading #BreakoutStrategy #SmartMoney #TechnicalAnalysis #TradeTheTrend #PriceAction #MarketStructure #FuturesTrading #ForexCommunity
BITCOIN TRADERS SHOULD ALLOW FED SET RATE ,RATHER THAN SPECULATING IT.THE CHANCES THEY WILL APPLY TYLOR RULE IS ON THE DESK.
The Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
AM WAITING ON SELL FROM THE ROOF .
HUNTER WAY.
#BTC #BITCOIN
DOLLAR INDEX STILL IN A DOWNTRENDIn this short video I demonstrate the continued downtrend of the dollar index after a small bounce to about 97.420. On the 4 hours time frame price has exceeded the Bollinger Band and KC band as it very over stretch statistically outside 2 standard deviations. After the bounce up I expect the continuation of the downtrend to the intended target of 96.280.
ETHEREUM TRADERS SHOULD ALLOW FED SET RATE ,RATHER THAN SPECULATING IT.THE CHANCES THEY WILL APPLY TYLOR RULE IS ON THE DESK.
The Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
AM WAITING ON SELL FROM THE ROOF .
HUNTER WAY.
#ETHEREUM
ETHEREUM PLS ALLOW FED TO DECIDE ON THE NEW RATE ,THE PROBABILTY FOR HIKE IS IN THE picture and incoming economic report will be put into perspective.
the fed will likely apply the Taylor Rule in its monetary policy decision.
The Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
Basic Taylor Rule Formula
r=p+0.5y+0.5(p−p ∗ )+r ∗
r=nominal federal funds rate (target rate)
p=actual inflation rate
p*=target inflation rate (~2%)
y=output gap (percent difference between actual and potential GDP)
r*=equilibrium real federal funds rate (often assumed to be about 2%)
In simple terms, the Fed should raise or lower rates in response to inflation deviations and output gaps to stabilize the economy.
The Taylor Rule matters because it guides the Fed to pursue a balanced approach—tightening policy when inflation or growth is too high, and easing when the economy slows or inflation falls short—helping to achieve stable prices and sustainable growth.
The Taylor rule also points to a hike
Even when considering the prior data, the Taylor Rule also suggests that the Fed could hike the Federal Funds rate. The Taylor Rule is one of the most reliable tools that the Fed considers for monetary policy action. It's based on the neutral rate, inflation measure, and the resource gap measure.
Since these are not easily measurable variables, the Taylor Rule allows for simulations with different measures. The most common measures are summarized in three scenarios.
Currently, two scenarios put the Federal Funds rate at around 4.25%, which is the bottom range of the current level of the Federal Funds rate, and suggests no cuts or hikes are necessary.
However, Scenario 3 is putting the Federal Funds rate at 5.45%, which suggests that the Fed should hike by around 1% from the current level.
The fact is that the unemployment rate is very low at the full employment level, while inflation has been well above the 2% target for a long time now.
trading is 100% probability.
apply caution at all time
think like a hunter.
#ethereum
BITCOIN BTCUSDTThe Taylor Rule is a monetary policy guideline developed by economist John B. Taylor in 1992. It provides a formula to help central banks, like the Federal Reserve, determine the optimal short-term interest rate based on economic conditions.
What is the Taylor Rule?
It links the central bank's target interest rate (the federal funds rate in the U.S.) to two key economic factors:
The difference between actual inflation and the central bank's target inflation rate (usually around 2%).
The output gap—the difference between actual economic output (GDP) and the economy's potential output.
The rule suggests that the central bank should raise interest rates when inflation is above target or when the economy is producing above its potential, to cool down inflation and avoid overheating.
Conversely, it advises lowering interest rates when inflation is below target or the economy is underperforming, to stimulate growth.
Why Does It Matter to the Fed in Rate Decisions?
The Taylor Rule provides a systematic, rules-based framework for setting interest rates, enhancing policy predictability and transparency.
It serves as a benchmark for policymakers to assess whether current rates are appropriate, balancing inflation control and economic growth.
The Fed often considers the Taylor Rule when making decisions but does not follow it mechanically, as real-world factors like financial stability and global economic conditions also influence policy.
During periods of deviation from the rule’s recommendation, the Fed may explain why it chose a different path, reflecting discretion and judgment.
The Taylor Rule helps anchor market expectations by providing a reference point for where interest rates "should" be, reducing uncertainty in financial markets.
Basic Taylor Rule Formula
r=p+0.5y+0.5(p−p ∗ )+r ∗
r=nominal federal funds rate (target rate)
p=actual inflation rate
p*=target inflation rate (~2%)
y=output gap (percent difference between actual and potential GDP)
r*=equilibrium real federal funds rate (often assumed to be about 2%)
In simple terms, the Fed should raise or lower rates in response to inflation deviations and output gaps to stabilize the economy.
The Taylor Rule matters because it guides the Fed to pursue a balanced approach—tightening policy when inflation or growth is too high, and easing when the economy slows or inflation falls short—helping to achieve stable prices and sustainable growth.
The Taylor rule also points to a hike
Even when considering the prior data, the Taylor Rule also suggests that the Fed could hike the Federal Funds rate. The Taylor Rule is one of the most reliable tools that the Fed considers for monetary policy action. It's based on the neutral rate, inflation measure, and the resource gap measure.
Since these are not easily measurable variables, the Taylor Rule allows for simulations with different measures. The most common measures are summarized in three scenarios.
Currently, two scenarios put the Federal Funds rate at around 4.25%, which is the bottom range of the current level of the Federal Funds rate, and suggests no cuts or hikes are necessary.
However, Scenario 3 is putting the Federal Funds rate at 5.45%, which suggests that the Fed should hike by around 1% from the current level.
The fact is that the unemployment rate is very low at the full employment level, while inflation has been well above the 2% target for a long time now.
trading is 100% probability ,EURUSD buy gains today could become bearish tomorrow.
trade carefully
WE NEED BUY/ SELL CONFIRMATION FOR NOW, ALLOW THE MARKET TO COOLOFF FROM JACKSON HOLE SPEECH OF SIR JEROME POWELL TWISTED DOVISH COMMENT ON FRIDAY.
THINK LIKE A HUNTER
#BTCUSDT
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