Making Sense

Broad based Deceleration in CPI || FFR pricing - 98% Prob. of a Rate Cut & Bull Steepening || Constructive Technical Set on US2s - Yields at 3.50% ??? || SPX Correction ???

"I fear not the man that has practiced 10,000 Kicks once, but I fear the man that has practiced one kick 10,000 times." ~ Bruce Lee Morning Everyone , This Week gave us a sense of how the prices or inflation has evolved and we had benign readings across CPI and PPI and the updated PCE estimates are now for a reading of 0.01% mom on the headline PCE and -0.01% on Core PCE Prices which translates to an annual reading of 2.4% yoy and 2.4% on Core PCE Prices. The Implied pricing off Fed Fund Futures is now pricing in o ne full 25 bps of rate cut into the September Policy and 61 bps of cumulative rate cuts for 2024. If you go further out the curve, 100 bps is priced in until March 2025 and 138 odd bps until June 2025. In the 23rd June Wrap, I had written On the DXY, 106.25 is a crucial resistance zone for DXY bears and an important point of reversal. So keep a watch on the levels with SL above 106.75. DXY declined over the last 2 weeks fro...

Chair Powell - Unequivocally Dovish at Jackson Hole ! Front and Centre Focus on Employment Numbers | USD Index at lower end of the 100.50 - 106.50 Range

I have two basic rules about winning in trading as well as in life: 1. If you don't bet, you can't win. 2. If you lose all your chips, you can't bet. ~ Larry Hite Over the last 3 weeks, after the Aug 5 lows, yields on US2s have consolidated in the 3.90% - 4.10% price range and US10s have progressively made lower lows to close the week at 3.92% and 3.80% respectively. US2s10s bull steepened to close the week at -11.90 bps. USD index closed the week at 100.68, 5% off highs of 106.13 June highs and within close proximity to the established range of 100.50 - 106.50 since last year. There is a 76% probability of a 25 bps rate cut in the Sep Policy. The market is broadly equally divided between a 25 bps and a 50 bps in the November Policy and holds a 87% probability of FFR in the 4.25% - 4.50% range by end of 2024. By next year September Policy, the market assigns a 90% probability of FFR at 3.25% - 3.50%, i.e. 200 bps of cuts in next 1 year. The Atlanta Fed GDP Now ...

Making Sense

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Ahead of the U.S. CPI Release - Expectations and What to watch in the internals / Fed Fund Pricing / Technical Levels

The Moment of Reckoning is here !! 25 or 50 Bps and the SEP || Benign PCE Expectations || USDJPY 145.75 or 137.50 ??

Continued Moderation in the Labor Market - Call for Action

Benign PCE but a Presidential Debate seems to have rocked the boat - US10s +14.30 bps

Broad based Deceleration in CPI || FFR pricing - 98% Prob. of a Rate Cut & Bull Steepening || Constructive Technical Set on US2s - Yields at 3.50% ??? || SPX Correction ???

The Pendulum Swings Again - From Soft Landing to Fears of a Recession | Employment | US2s and US10s Technical Levels | Macro Musings

DXY holds 100.50 support| US2s10s Steepening persists| Economic Data at Cross Roads | Is more than 200 bps of Rate Cut space available?

Embedded Narrative - Soft Landing | Benign Inflation | US2s H&S in play | US2s10s bull steepening

Shroedinger's Cat ~ Preparation is the Key to play markets || US Politics || Macro Musings

Recalibration of Policy Stance | Ride in Risk Assets | Soft Landing | Close out US2s10s Bear Steepeners

Chair Powell - Unequivocally Dovish at Jackson Hole ! Front and Centre Focus on Employment Numbers | USD Index at lower end of the 100.50 - 106.50 Range