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See How They Run 5/31/22

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The ES 24 hour S&P fugutures hit 4202 overnight, but that was well shy of a 5 day cycle projection of 4245. Meanwhile, as of 3:45 AM in New York, the futures have fallen back sharply, thanks to European traders, and various and sundry trading algos having second thoughts here this morning. 

At the moment, the 2-3 day cycle projection on this pullback is 4105. That also happens to be about where the 1 week uptrend channel lower line happens to be in a few hours. So we'll watch for the bounce and see how far they can run with it. 

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The 10 year yield has come down to a support convergence and popped. This is a critical fulcrum. 

y8p4e

 

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This thing is a hair away from reversing that beautiful base breakout. So far, it's just a return to the scene of the crime, but it won't be if they don't rebound soon. 

y8qpn

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6 hours ago, DrStool said:

At the moment, the 2-3 day cycle projection on this pullback is 4105. That also happens to be about where the 1 week uptrend channel lower line happens to be in a few hours. So we'll watch for the bounce and see how far they can run with it. 

Ooop there it is. 

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21 minutes ago, potatohead said:

Lee,

Been following Joseph Wang https://twitter.com/FedGuy12 (former Fed Reserve open markets trader) has a good article out. He sees RRP going to $2.5 trillion. accelerating reduction in bank deposits and asset selling.

https://fedguy.com/turbo-tightening/

That a former Fed trader confirms my work is heartening. Lori Logan, the Fed's head trader, soon to be President of the Dallas Fed, has also written and spoken extensively about the process. She too confirms exactly what I have been writing about for 20 years. It's just how the monetary system works. And it's not how Wall Street, or mainstream economists say it works. They're all full of shit. 

People like Wang and Logan know the deal from the inside. It's great that they are setting things straight, but I guarantee this. No one on Wall Street will pay any attention, or work to amplify these facts, because it doesn't serve their purposes. 

I had always wondered if any Fed insiders would finally speak up. In the past year or so, they've begun to. Why? I don't know. But it's good to know that my interpretation of what I've observed has been dead on. I didn't need Fed insiders to tell me, however. The market told me.  It's really just a matter of seeing the dots and connecting them. 

When the Fed allows its Treasury holdings to be redeemed, this causes deposits to be withdrawn from the banking system to repay the the Fed's loans to the Treasury. The Treasury needs to issue more paper to the public to repay the Fed. The public pays for the paper by writing checks from their checking accounts. The Treasury then repays the Fed, and the money is extinguished, i.e. it goes back into the Fed's imagination, from whence it can be rematerialized when needed in the future. 

I have been warning about this for many months. Tells me that you don't need to be on the inside to understand the process. It's just accounting 101! 😊 

Now, as for the RRPs getting to $2.5 trillion by year end. I don't see that as a possibility. The Treasury will need to start issuing T-bills again soon. Some RRP holders will use RRP cash to buy the bills. But the higher the total in RRPs holds, the more bearish it is. 

This report explains and tells what to look for, how to play it in fixed income and stocks. 

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8 minutes ago, DrStool said:

That a former Fed trader confirms my work is heartening. Lori Logan, the Fed's head trader, soon to be President of the Dallas Fed, has also written and spoken extensively about the process. She too confirms exactly what I have been writing about for 20 years. It's just how the monetary system works. And it's not how Wall Street, or mainstream economists say it works. They're all full of shit. 

People like Wang and Logan know the deal from the inside. It's great that they are setting things straight, but I guarantee this. No one on Wall Street will pay any attention, or work to amplify these facts, because it doesn't serve their purposes. 

I had always wondered if any Fed insiders would finally speak up. In the past year or so, they've begun to. Why? I don't know. But it's good to know that my interpretation of what I've observed has been dead on. I didn't need Fed insiders to tell me, however. The market told me.  It's really just a matter of seeing the dots and connecting them. 

When the Fed allows its Treasury holdings to be redeemed, this causes deposits to be withdrawn from the banking system to repay the the Fed's loans to the Treasury. The Treasury needs to issue more paper to the public to repay the Fed. The public pays for the paper by writing checks from their checking accounts. The Treasury then repays the Fed, and the money is extinguished, i.e. it goes back into the Fed's imagination, from whence it can be rematerialized when needed in the future. 

I have been warning about this for many months. Tells me that you don't need to be on the inside to understand the process. It's just accounting 101! 😊 

Now, as for the RRPs getting to $2.5 trillion by year end. I don't see that as a possibility. The Treasury will need to start issuing T-bills again soon. Some RRP holders will use RRP cash to buy the bills. But the higher the total in RRPs holds, the more bearish it is. 

This report explains and tells what to look for, how to play it in fixed income and stocks. 

Lee,

All I can say is I wish the Fintwit community paid more attention to you.

I have a feeling this is just the beginning, like you said, if the Fed wants to drain, this could get ugly. All ready started?

https://www.reuters.com/business/finance/exclusive-credit-suisse-weighs-options-strengthen-capital-sources-2022-05-30/

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1 hour ago, potatohead said:

could not resist....

Mickey Mouse soapopera ;) | Mickey mouse drawings, Mickey mouse characters, Mickey  mouse

And as usual,

Another Rip job higher,

that picture has been doom for the bears.......for more than a decade......

 

>: QT........Herbert is laughing his F'ing A$$ off...........

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1 hour ago, potatohead said:

Lee,

All I can say is I wish the Fintwit community paid more attention to you.

I have a feeling this is just the beginning, like you said, if the Fed wants to drain, this could get ugly. All ready started?

https://www.reuters.com/business/finance/exclusive-credit-suisse-weighs-options-strengthen-capital-sources-2022-05-30/

I don't know about paying attention. But it would be nice if more people subscribed and helped me pay the bills. 😄  

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Market is following the script perfectly today. Now we're at the push comes to shove stage. 

y8s97

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