Weeks Review| Prep W/C 9th Jan 2023

Weeks Summary

The latest Fed minutes from the December FOMC meeting reaffirmed the US central bank’s commitment to inflation targeting and suggested that the Fed would continue to raise interest rates.

Despite a recent easing of inflationary pressures, inflation remains a source of concern. The upcoming CPI release will thus be of interest, particularly if the data surprises onOvernight Session More the downside, as suggested by the S&P Global Flash US Composite
In addition to monitoring the previous day's Market prof... More PMI. The extent to which risk assets may positively respond to softening inflation indicators appears more ambiguous now, following Fed officials’ caution about market rallies impeding inflation-targeting operations.

Following the latest nonfarm payrolls report, which showed wage growth slowing in December, U.S. equity markets surged onOvernight Session More Friday, implying progress in the Federal Reserve’s efforts to tame inflation. The Dow and S&P 500 gained 1.5% for the week, while the Nasdaq gained about 1%. Treasury yields in the United States fell sharply this week, with the 10-year note yield falling nearly 30 basis points (bps) and trading below 3.6% onOvernight Session More Friday. The yield curve is still deeply inverted, with the two-year note yielding just under 4.3%. Crude oil prices fell more than 7% this week as a rebound in COVID-19 cases in China cast doubt onOvernight Session More global demand. West Texas Intermediate (WTI) crude oil price, the U.S. benchmark, has dropped to a three-week low of $78.

This is going to be a fun week.

KEY TAKEAWAYS

• The Bureau of Labor Statistics (BLS) will release the Consumer Price Index (CPI) for December onOvernight Session More Thursday, providing the latest update onOvernight Session More consumer inflation.
• Earnings season kicks off next week with earnings from big banks and financial firms, with JPMorgan Chase, Bank of America, Wells Fargo, Citigroup, and BlackRock all reporting onOvernight Session More Friday.
• Other companies reporting earnings next week include Taiwan Semiconductor Manufacturing Company, DeltaDelta hedging seeks to mitigate, or hedge, the directional r... More Air Lines, and UnitedHealth Group.
• Also, onOvernight Session More Friday, the University of Michigan will release its preliminary Consumer Sentiment Index (MCSI) for January.

Events Calendar: CET

Review week’s RTHRegular trading hours. The official opening and closing time... More before I look at the profiles. Can you see where price actionPrice action More and reversals can you identify where the price becomes stuck–look at the overlapping profiles. Does this help? Look at last week’s references. Look at the shape of the daily profiles.

Weeks Price ActionPrice action More Review

Why look at the Weekly and Monthly?

Using the composite
In addition to monitoring the previous day's Market prof... More profiles gives me a lot of clarity in understanding the market. Understanding the story and the basic mechanics of what is going onOvernight Session More simplifies almost every other aspect of my trading, especially timing.

I have a natural edge by identifying areas of balance/ acceptance in the auction. I can identify value and the pivots of change. In balance, I look to fade the extremes. When activity leaves an area of acceptance, I monitor for strength and conviction of the move. For this, I use volume and value as a guide. As a general rule, if a move is genuine, volume and value will move in away from prior acceptance to a new area.