Risk Window for the Week of July 11th & Pounded to New Lows

According to my risk summation system, the day this coming week with the highest risk of a turn in or acceleration of the current trend in the DJIA is Wednesday July 13th.  

Last week the Tuesday/Wednesday risk window tagged the low for the week early in the window.  The Friday the 8th risk window may have caught a top depending on the action early next week.  

It just so happens that the risk window this coming week coincides with the release of the latest inflation data.  Given the strong jobs number late last week, a high inflation value will all but seal the deal for another 3/4% bump in the FED funds rate at the late in the month meeting.  Given that will be baked in the cake, the future rate guidance at that meeting will probably be what to watch for at the meeting presser.  Any hints at a possible pause or lessening of their supposed inflation fighting resolve would be very bullish.  

Last week the British currency and the British leader both got Pounded to new lows.  Given the high commercial trader long position and relatively high large speculator and small trader short position for the British Pound shown in the finviz.com plot below, I suspect better days are not too far away for the currency, but not so for poor Boris who is now looking for both a job and a new place to live.  Great system they got here where if the leader turns out to be a clinker, he can be quickly ousted and replaced.  Same party will stay in charge, but with a new leader.   

Regards,

Douglas

Biden is lucky. He can live in White House at least through January 2025. Democrats are not in the habit of impeaching their own.

pdx5, you are forgetting a little thing called the midterms coming shortly to a polling station near you.  In normal times the incumbent president's party loses ground, but in these recessionary, inflationary, never ending pandemic, etc. times, the House and the Senate may both fall to the red team who will impeach Joe just for grins and giggles, maybe not convict, but definitely impeach.  After all, the blue team dipped the Donald twice, it might just become a right of passage for the office as supremely dysfunctional as the US federal machinery has become, who knows. 

The political circus aside on this side of the pond and yours, I think that this coming week is really pivotal in the market big scheme of things.  The inflation figures  coming out of the magic number manipulators at the BLS and the utterings of the FED minions immediately thereafter the release should have a major impact on the trajectory of the market.  Bad numbers and tough talk spells trouble, and improving numbers and pausing talk mean be long or be wrong.

Regards,

Douglas

Edited by Douglas, 10 July 2022 - 03:26 PM.