Market Musing 10-04-2022, Is the Fed backed into a corner?

PUBLISHED Oct 16, 2022, 3:20:34 PM        SHARE

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Tuesday 9:45am - DNOWS Meetup

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SPX will move

Seabrook Discussion 7pm Wednesday

New Age Traders Noon Thursday

1. High High Volatility: VIX > 328.

The Markets are bouncing off the hope that the Fed will slow down rate hikes. Fed Chair Powell is forecasting another 100 to 125 basis points higher rate before the end of 2022. Is this a dead cat bounce in a bearish market, where short term the markets were oversold? Please keep your hedges on through the Midterm elections. The new expected SPX range for this week: 3707 top and 3464 bottom.

SPX Chart

2. US Dollar and 10 Year Interest Rate:

The US Dollar dropped back to 111. 10Y Note Interest have dropped to 3.65. 30 year fixed rate mortgages are around 6.5%. The Global request from IMF and other Central Banks for the US to slow rate hikes is being priced into the Dollar and US Notes/Bonds. The Yield curve for the 2 year vs 10 year near 1981 levels. In the past, 2 negative GDP Quarters signaled a recession, but apparently this time is different?!?!? Long Term the US Dollar decline is still intact with Fiscal and Monetary stimulus flooding the world with US Dollars.

DXY Chart

3. Crypto Currency:

Bitcoin at $19,210 is still range bound. The $24,000 to $18,525 range has lasted 17 weeks. Corporations, Countries, and Institutional investors are accumulating large Bitcoin positions. Fidelity($3.5T AUM), Charles Scwab ($5.0T AUM) and Citadel are partnering to create a Crypto brokerage for their clients following Black Rocks ($11T AUM) lead. Please continue to Dollar Cost Average into Bitcoin and Ethereum. Crypto winter will last for another 6 months, as we wait for the next Bitcoin Halvening in 18 months.

https://support.tastyworks.com/support/solutions/articles/43000612831-available-cryptocurrencies

BTC Chart

4. Tasty Works Algo Trading System: James at Quiet Foundation

Alpha Boost ideas, sign up https://info.quietfoundation.com/alphaboost

https://issuu.com/luckbox/docs/2111-luckbox-site/56 Alph Boost Article

If you are new to options or this blog sounds like gibberish, please tryout Tasty Trade’s New 2020 Education. Includes 40 Videos, Testing and you get a certificate of completion at the end of the course.

https://tastytrade.thinkific.com/courses/beginner-options-course

5. TRADE Log: VIX > 28

  • 1.) Jade Lizards -

  • 2.) Put Broken Wing Butterflies -

  • 3.) Put and Call Credit Spreads -

  • 4.) Put Calendars -

  • 6.) Upside Ghetto Spreads -

  • 7.) Downside Ghetto Spreads -

  • 8.) Collars -

  • 9.) Weekly Butterflies - SPX

  • 10.) Covered Calls -

Trade Mechanics

6. Video and Articles

Theotrade - Can Markets Back the Fed into a Corner???

https://youtu.be/h-JOpI9dcDA

https://traderschoice.net/about-traders-choice/



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