USA Stocks discussion - Part 3

aurvandil

aurvandil

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We are fast approaching the 5500. Key specific value in the ES futures I am watching is the 5528.75. Expectation is for a test. It is unlikely that we will get through on the first test so we will likely trade around the 5500 for a while. If it gets through, then next key level below will be the 5250.
 
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stanlawj

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xoxozone said:
Oh no...
Click to expand...

Pls ignore all these anti-Trump narratives. Trump wants to crash market to refinance.. etc...

The Federal Reserve refuse to cut rates early (Jan FOMC) to buffer against the coming DOGE consequences. When DOGE cuts govt spending, both GDP and govt tax receipts will get hit hard and cause severe recession + bond market crisis if Fed maintains current FFR.

Refer to this post back on 17 Dec 2024:
stanlawj said:
Luke Grommen explains the sequence of coordinated actions between the Fed and US Govt that will result in Trump achieving his goal of US growth + cutting US Federal deficits + save UST & USD.

1. Fed cuts FFR faster than expected.
2. DOGE cuts Federal spending
3. Tax cuts etc.

If 2 happens before 1, it will be the opposite: US stock + bond market crash + massive unemployment (ex-Govt employees). Trump may lose his political support. And Powell will likely end his legacy in 2026 as the worst Fed chair.
Hope Powell knows about this and has been spending his working hours wisely running simulations and anticipating the big rise in unemployment coming soon.

Click to expand...


The fact that bond market is not crashing (yields not rising fast but are instead falling), means the market is still confident of US and we simply have a rotation in play. Eg. airlines are getting hit now as they start guiding towards lower earnings implying the top earners are traveling less. Fund managers take profits on big tech, consumer discretionary, and then redistribute to other defensive sectors (consumer staples, healthcare, real estate). Some rotation from stock to bonds and foreign markets (China, EU) is also happening. Market may also be confidently anticipating Fed reaction will be to cut FFR.

https://www.cnbc.com/2025/03/10/delta-air-lines-cuts-forecast-softer-demand.html

Delta Air Lines slashes earnings outlook on weaker U.S. demand, sending shares lower​

 
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stanlawj

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UST 6-month yield starting to move down a little.
UST 3-month yield still unchanged.
DXY lower than last week's close.
Fedwatch tool shows change to higher probability for FOMC cutting rates in May but not in March.
 
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DevilPlate

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aurvandil said:
We are fast approaching the 5500. Key specific value in the ES futures I am watching is the 5528.75. Expectation is for a test. It is unlikely that we will get through on the first test so we will likely trade around the 5500 for a while. If it gets through, then next key level below will be the 5250.
Click to expand...
right after what u said, market decide to fall decisively whahaha
Some expects a sharp rally anytime soon
 
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DevilPlate

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stanlawj said:
Pls ignore all these anti-Trump narratives. Trump wants to crash market to refinance.. etc...

The Federal Reserve refuse to cut rates early (Jan FOMC) to buffer against the coming DOGE consequences. When DOGE cuts govt spending, both GDP and govt tax receipts will get hit hard and cause severe recession + bond market crisis if Fed maintains current FFR.

Refer to this post back on 17 Dec 2024:


The fact that bond market is not crashing (yields not rising fast but are instead falling), means the market is still confident of US and we simply have a rotation in play. Eg. airlines are getting hit now as they guiding for lower earnings implying the top earners are traveling less. Fund managers take profits on big tech, consumer discretionary, and then redistribute to other defensive sectors (consumer staples, healthcare, real estate). Some rotation from stock to bonds and foreign markets (China, EU) is also happening. Market may also be confidently anticipating Fed reaction will be to cut FFR.

https://www.cnbc.com/2025/03/10/delta-air-lines-cuts-forecast-softer-demand.html

Delta Air Lines slashes earnings outlook on weaker U.S. demand, sending shares lower​

Click to expand...
Because Powell bey song Trump whahahaha
 
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