Good morning traders!
Just a heads up this is being written at 0800 EDT, 30 minutes before GDP is released but levels will be pulled after data is out.
Now that we have the 3 eventless sessions behind we can look for some potential direction outside of this range. While this range has been great for shorts at VAH and longs at VAL, today and tomorrow we have economic releases. GDP will be released this morning before the open and the same will follow for PCE tomorrow. I gave some thoughts on GDP over in the telegram but I will make sure to touch on this in todays plan.
Here’s a chart of the cash session after the most recent GDP report on February 23rd.
Range: 60 Handles with open to close nearly unchanged
Levels will be pulled AFTER the release at 0830 EDT but my expectations going into the event will be for a sell lower below 4040s. Ideally they hold emini here at highs of value then dump it tomorrow on the data release. Nearly every sell started from value area highs inside these large ranges. Navigating this week has been tough as most of the time spent has been sitting on hands, at least for emini. Allowing levels to work is never hard as LIS is always resting in market and when proven wrong I simply recap the trade then move on. Being bored is a very real problem and don’t let this get in the way of sticking to what you understand. Even looking for setups rather than them appearing to you, only because you simply were looking for it. Most the time unless I have a plan for another trade BEFORE I was proven wrong, I will not touch the market as I was caught on the wrong side. Some from this point may step away, drop size, stick with their highest probability setup to protect capital. All about what your comfortable with and knowing your limits.
Now back to what we think we have in store for todays session.
Hopefully everyone has been keeping up with the market and know what range I have been referring to for over a week now. The two setups I see will be a long for a move outside of value and a short if we remain inside value.
Take a look at the chart below and notice on the right side we have little to no value built up from 4070-4120.
If you look now to the top left to the intraday profiles you can now see where we have some value built up at these highs. The main level that has caught my eye on upside is 4112 as this was the POC of that session. Then for downside I will look for a move to 4038. These may trade shortly after release so note my main levels are going to be in the Daily Plan.
What’s going on with Gold?
After the latest FOMC we have seen investors brace for cover and they do so with Gold. In 2022, demand shot up 28% as inflation was on the rise. One of the main buyers in this period were the central banks but s this still the case in 2023? Yes.
The main buyers have been China, Turkey, and India. What can be concerning and is only a leading sign is that a country that is getting ready for war will buy plenty of gold to counter sanctions. The story I have pushed about Taiwan has began to pick up in pace with this strong move by China. Not only this but they are strengthening their relations against the US.
As much as I want the best ahead, it is yet to look like a promising next 2-3 years. Who is even to say Russia - Ukraine war will be over by the time China invades Taiwan (if they do). The world will see serious supply chain problems and once again the US will suffer following terrible actions by this admin.
Economy in the gutter, Gold very strong and pointing to more pain.
Add in the slaughter of DXY and this will all begin to make sense. More and more countries following in dropping the USD as the main currency. We have even seen local currencies made to avoid USD.
Let me be very clear with everyone, I love this country but the corruption everywhere is disgusting and hard to stand behind. When an admin boasts about a robust economy yet everyone is suffering, I can’t stand behind it. When the government will take everything you “own” because debt but they bail themselves out everytime. Who pays for this? The American people. I was one of few to call this hyperinflation since COVID stimulus. Unless you burn the money created there will be no decline in prices. This is the only reason why the FED is starting to slow rates and potentially strangle them.
Feel free to share your thoughts on this!