Markets Sideways Until Friday?
#bitcoin #btcusd #crypto #cryptocurrency #stocks #usdollar #dollar #thefed #ratehike #inflation #fomc #cpi
Just a quick update to let you know what is going on in Stewdamus world. I haven’t forgotten about you all or the trade portfolio. My biggest issue at this point is the business of life. I knew summer would be this way. I am still committed to putting out content for you all but I don’t imagine I’ll be able to pick up the pace here until this fall.
Another reason you are not seeing much from me in the way of posts is that this market is just plain dull and seems to be rangebound. I expect this sideways price action to break over the weekend. I have several reasons for believing this which I will get to shortly, but first, allow me to give you two short items of relevant news regarding my content and trades.
First, I will be changing it up a bit and only doing a video once per week now as opposed to two. Previously, I put out a video on Monday around or just after U.S. markets opened and then one on Friday to wrap up weekly market events. I now plan to only put out one video per week regarding market updates. I think that should be all we need as I tend find myself repeating observations made in previous videos. I will most probably put out most of my weekly updates on Fridays and I will make sure to include the wrap-up of the current week as well as the forecast for next week in the video.
Secondly, while I was on vacation, you may have noticed my stop-outs were reached on two positions I held, Bitcoin and Jasmy. Bitcoin failed to break out to the upside of a Cup and Handle pattern I had spotted and Jasmy was also a dud. Both of these coins dumped me out at my stops before pumping up a bit thereafter. I am still getting the hang of these stops but I believe I had them set appropriately in these cases.
I remain in two positions but I expect I very well could get stopped out of these two as well. I am spotting good bullish patterns but these bears remain strong and everything continues to remain bearish at the moment. This is why the old saying always rings true, “The trend is your friend!” It is also why I am trading very little down here. Almost all of my crypto is being held off-chain in hard wallets at this point.
So, a losing start to my $10,000 portfolio but not to worry, I’ve come back from much bigger deficits than this! I am not a quitter and I know that in the end I can make this thing work. You can view the current spreadsheet with all of my trade data HERE:
Ok on to a short and very brief explanation as to why I believe this weekend will tell us more about the future direction regarding this market.
Obviously, the big one is the new CPI data release this week Wednesday morning. I believe the Fed will release a statement regarding the data and give more hints as to future action. Pending this data and these statements, the market should break its current range and find more direction.
Now, here’s what I am seeing from a technical perspective.
First, the dollar has been showing amazing strength over the past several months. Bull flag after bull flag and they have all carried out as expected. Now, currently, it is up against what I would consider significant resistance. We should find out this week whether or not this resistance can be defeated or whether the dollar will fail its continued move up and come back down for a bit of a rest.
The VIX may be giving us a hint here as it has broken down below our support and I think it may continue down. When fear drops, the market pops.
And one more chart here. This one was created by my friend Katrina from Ukraine and I find the fractal patterns illustrated here simply amazing. Notice how exact the time interval were per circle. Three drops and then relief. Three more drops (each 37 days in length) and then what? That last circle #3 would end this Saturday if it also went 37 days long. Will we know more by the weekend? I have a hunch we may:
Take care out there my friends!