Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Yield curve suggests that US Recession is near: Trading Setups

Stock-Markets / Financial Markets 2019 Jan 11, 2019 - 10:26 AM GMT

By: FXCOT

Stock-Markets

Investors think recession risk is quite high. This, though, raises another question: Since investors have access to the same news and data as the Fed, how can they know the economy better than the Fed? Economist Jesse Edgerton of J.P. Morgan has found that economic data has a better record of predicting recession than the yield curve and right now, the data sees lower odds than the yield curve. Short-term interest rates are set by the Federal Reserve, and long-term rates by bond market investors. The curve has been flattening for the past two years as the Fed has slowly raised short-term rates in hopes of a “soft landing,” a slowing in growth that keeps both unemployment and inflation low and stable. But in recent months the flattening has been driven by falling bond yields. The usual interpretation: Investors in their collective wisdom think the Fed is overdoing it with rate increases and could shove the economy into recession, in which case short-term rates will be lower in a few years than they are now.


Investors in their collective wisdom think the Fed is overdoing it with rate increases and could shove the economy into recession, in which case short-term rates will be lower in a few years than they are now.

The yield curve can act as self fullfilling prophecy. When the long end of the curve starts to fall, it can trigger a herd mentality where more money will start to feed into the safety of long term treasuries. So in a way the inverting of the curve will not only predict the recession but causes it.

We attach some major charts and the market trading setups Dollar Index

Dollar Index has fallen below our key support level at 95.5. No bounce of these levels suggests there could be some more bearish pressure. Unless the FED is outright bullish when they talk later today, the narrative may not change. Risk aversion will be another trigger for some more dollar rally. We continue to suggest to clients to not trade manually or based on charts and indicators. Our trading system is pure price action based system which trades on BREAKOUT and Volatility and SCALPING. These are systems used in professional bank desks on super select prop desks. It takes out imagination fueled trades based on charts. If you would like to connect your mt4 to our system, please contact us

The stock indices are returning to the previous broken support level at 2600 to 2625. We expect equity markets to face fierce resistance and some short term pull back is expected. The 2625 level will decide the ultimate course of S&P if the bull market can pull back to 2800 or not.

The fear index, vix, is pointing to some short term bounce in volatility. The index has been continuously above 20 levels and has made trading far ore costly.

The weekly charts of ifutures show overhead resistance at 2630/25. We see those levels in play. The resolution of China trade talks and potential NK meeting will take it there.

The 30 min of the continuous futures, suggests that prices are not backing away yet of the strong overhead resistance. There could be further strength left in the rally before exhaustion. Bear market rallies can be sharp and take out almost all the bears. Be careful if you are a early shorter.

GOLD is near breakout level. 1298 level is the barrier and once it clears, we could push to 1325. Watch out for dovish fed commentary today.

Oil is nearing strong resistance at 54. A breakout above 54 could see some string upside move to 64. Only dollar strength can put a lid on oil.

Onto forex markets, things are dicey and difficult. Forex markets have become virtually impossible to trade for the small time retail trader trying to decipher charts and indicators. It simply is a 50:50 game. That is the reason why we rely on one of the world most profitable and secretive trading systems in the world. It operates on EURUSD, GBPUSD, USDJPY and GOLD. It trades automatically with complete risk management.

Yesterday, when EURUSD broke out from 1.1482 to 1.1569, thousands of traders were caught short as the pair broke out.There was no specific reason for the price action. A normal trader would have missed the whole move. But FXCOT system entered long at precisely the break out level and rode the whole move to 1.1569. It is just the latest example of the perfection of the system.

EURUSD breakout was traded by FXCOT TRADE COPIER

See above how it went long at 1.1482 and kept initial stops at 1.1450 and then later to breakeven and later to trailing stops to protect stops. This is just one of the examples of the trades it has taken among hundreds available for scrutiny.

The system has made +6.5% in January, 2019. It performance in 2018 has been stellar where it made +130% return. See the performance below.

January returns are interim as we are still trading. These results are realised on client accounts and it could be on yours. All you need is a MT4 terminal from a world leading forex broker. You can apply here: New Application for MT4 account for FXCOT system .

Please contact us if you have any queries

FXCOT is Investment Management firm specializing in futures and forex trading. We run a high return trading system for our premier clients. The trading systems uses four different strategies to take advantage of various market conditions. We also send daily trade setups and economic commentary.

© 2019 Copyright FXCOT - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in