2022/09/27 (078) Column

„The war on inflation!“
„Really Now?“


Like schoolchildren waiting for the bell during a bad lesson, we market guys are all anxiously awaiting the end of inflation. Which biting through our money like a cancer; from month to month, compared to the previous year, we can buy less and less with the same one. Admittedly, both in the US and/or here in the euro zone, especially in my home country of Germany, there are definitely temporary signs, in the form of indicators, that it will soften a luttle bit in the future. But in order to push inflation down from the current still high level – more or less at the level during the outbreak of the Russia/Ukraine-War both central banks, i.e. the FED and the ECB, have to jump over your shadow. In order to finally resume the restrictive, hawkish monetary policy that prevailed before the Lehman Bank disaster in 2008.

But to what extent will both the FED and/or the ECB counteract their monetary policy of the last 14 years and throw it overboard? Will both central banks, in the future, be a lack of support for the stock markets? A lack of resistance, for a respectively more expensive USD and EUR Yield Curve? For my sake YES! Definitely! In any case! YES, YES and again YES! Even if it basically puts the stock market under pressure. Because, in the case of high key interest rates, this offers a real fixed-interest alternative – see yield curve. So that speculation in bitcoin bcame useless – because, you can get even a real fixed interest (withoit speculation). However, we are all taxpayers and consumers, an with higher interest rates (at least higher as the inflation) we would at least have something like a positive inflation compensation again. So nominally strong purchasing power!
What? Yes that’s it! That´s how they way to win the war on inflation…

DEVISE 2 DAY 48h – Some Last Price Action News

US Stocks End Choppy Session Slightly Down, Nasdaq Outperforms
Wall Street pared major losses in a choppy session Tuesday, with the Dow losing 123 points (down 0.4%) and the S&P 500 down 0.2%, while the Nasdaq edged out a gain of 0.25%. Intense selling pressure continues as investors are concerned over corporate earnings given soaring interest rates, an intensely strong dollar, and prospects of an economic downturn. The gloomy mood was exacerbated by a slew of hawkish Fed speeches, with Chicago Fed President Charles Evans and St. Louis Fed President James Bullard making a case for more rate hikes in future meetings. On top of that, upbeat economic releases supported the Fed’s aggressive stance: new orders for US-manufactured capital goods rose more than expected in August, and home sales unexpectedly rebounded last month. The market movement came as the US 10Y approached 400 BPS and the DXY held highs not seen since 2001 while the VIX volatility index peaked above the 34 mark.

Indian Rupee Hits All-time Low
The Indian Rupee hit an all-time low in the last week of September falling to 81.742 per USD as Indian Bond yields fell on reports that JP Morgan would not include the nation’s debt in its semi-annual emerging market index review. The Reserve Bank of India has also lagged behind the US Federal Reserve in its interest rate hikes hiking only 140 BPS this year compared to the Fed’s 300 BPS hike YTD.

Stocks in United States Hit 21-month Low
US500 decreased to a 21-month low of 3626

Dollar Bounces Back Above 114
The dollar index bounced back above the 114 mark, recovering from its daily lows of around 113 as investors reassessed the likely path for US monetary policy. A slew of hawkish Fed speeches, with Chicago Fed President Charles Evans and St. Louis Fed President James Bullard making a case for more rate hikes in future meetings, reaffirmed the central bank’s commitment to tame inflation even at the risk of a recession.On top of that, haven demand continued to support the currency as investors rushed for its safety amid a highly uncertain global economic outlook and mounting recession risks. The dollar held near multi-decade highs against the euro and the yen while hovering close to an all-time low against the sterling amid a lack of confidence in Britain’s fiscal strategy.

Turkish Lira Hits All-time Low
USDTRY increased to an all-time high of 18.555

Euro Hits 20-Year Low
The euro plunged to its lowest level against the dollar in 20 years, changing hands at around $0.96 as investors fretted over an energy crisis and gloomy growth outlook in the common currency region. Signs that economic activity has been deteriorating sharply in the eurozone set a sharp contrast with a still somehow resilient US economy, making it difficult for the euro to attract fresh buying. On top of that, political uncertainty in Italy, the most indebted country in the region, raised concerns about a sovereign-debt crisis. Meanwhile, hawkish remarks from several Fed policymakers supercharged upward momentum on the dollar side.

Serbian Dinar Hits All-time Low
USDRSD increased to an all-time high of 122.35

Russian Stocks Halt Plunge
The ruble-based MOEX Russia index closed a choppy session 1% higher at 1,955 on Tuesday, bouncing off 5-year lows and following the 7% decline in the prior session and a 17% plunge last week amid continued worries of escalation of the war in Ukraine and nuclear threats form the Kremlin. Referendums to join Russia continued in four regions of Ukraine after voting began on Friday, raising concerns that Moscow will respond aggressively to Kyiv’s recent counterattack as the territories will be formerly seen as domestically annexed. Last week, President Putin ordered the country’s first military mobilization since World War II and emphasized Russia readiness to use its nuclear weapon arsenal. Russian financial markets were also pressured by the announcement Russia would raise tax exports on commodities to collect RUB 3 trillion to cover its looming budget deficit and increasing war chest.DEVISE 2 DAY Another 48 Hours – Where I Was Wrong, Whre I Was Right

On Monday lasz week before we closed our 5 open 4XSetUps with a lost. Like our MSFT long trading capability (from 03/07/2022) with a lost of 41.26 $ (last price 244.74 $ as we went long at 285 $) at once. Our GBPJPY long trading capability (from last monday 09/12/2022) with a lost of 2.04 GBPJPY (last price 163.21 GBPJPY as we went long at 165.25 GBPJPY). Our VOW3 long trading capability (from last tuesday 09/13/2022) with a lost of 6.54 € (last price 145.46 € as we went long at 152.00 €). Like our LVMH long trading capability (from last wednesday 09/14/2022) with a lost of 12.4 € (last price 637.5 € as we went long at 649.9 €). And/Or last but not least also our GS long trading capability (from last thursday 09/15/2022) with a lost of 1.05 $ (last price 326.21 $ as we went long at 327.26 $). So we`re only long in the DXY and/or short in the UKOIL this week. But in these both trading capabilities at least with still an existing booking profit currently.

However, this week’s focus on the CBOT_MINI-YM1!
More in the Technical Anaylsis 4XSetUps once again every day, this week.