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If you trade Oil, read this.
Oil dropped $1 after reports Qatar mediators sent Iran a new draft deal.
Why you should care:
- if the US and Iran both accept, you can see more inflow into risk assets
- the market is already reacting to the news
- oil moves feed straight into rates and Fed talk, so you should care even if you don't trade it
Are you positioned for it or waiting for confirmation?
93% of the market says the Fed holds at 2 PM ET today.
So the decision isn't really the trade. What Warsh says after it is.
→ He sounds patient: the dollar can ease and gold gets some room
→ He keeps a December hike on the table: the dollar firms up, gold and Nasdaq feel it
→ Oil is up again this morning on Iran headlines, which makes sounding patient harder
Then tomorrow at 8:30 AM ET, GDP and PCE show if inflation is still running hot.
If you trade gold or Nasdaq today, what's your call for 2 PM?
3 things you need to know before Warsh speaks tomorrow, because the Fed hiked in September to 3.75-4.00% and almost nobody expected it to matter this much.
How we got here:
→ War starts, Hormuz gets hit, oil goes to $100+
→ Gas costs more, inflation runs hot (CPI 3.7%)
→ Fed hikes to 3.75-4.00%
That's what happened at the last FOMC. They hiked, and the market had to accept that oil was now driving the Fed.
Tomorrow's meeting is about three things:
→ Does he say December is a hike or keep it open?
→ How does he talk about oil and Hormuz?
→ Does he sound worried about CPI or calm?
How to position:
If he leans toward December's hike, you can expect a stronger dollar and weaker gold. If he sounds calm about oil, gold gets room.
Don't trade the first candle. Let the headline pass and trade what he says in the press conference.
Be honest, what's your plan for tomorrow, dollar long or gold long?
If you only watch the Fed decision, you're late.
Here's 3 things that can happen:
→ Everyone expects a hold, so it's already priced in.
→ Fed holds exactly as expected, and the market barely moves
→ Fed hints at further rate hikes later in the year, and price swings hard
Markets trade the future, not the headline. You trade what changed in people's minds, not what happened.
Be honest, do you check what's priced in before you take a trade, or only after you get stopped out?
The Fed decides tomorrow at 2:00 PM ET. A hold is priced at 95%.
The bigger move is December: a 25 bps hike now sits at 77%, up 2 points in the last 24 hours.
MRKT's Interest Rate Tracker shows it all, live:
→ Policy rates and live decision odds for every central bank
→ The full meeting path, from tomorrow to March
→ Market pricing in basis points, and how it moved this week
→ Real rates against CPI for each bank
Watch it reprice as Warsh speaks.
Most traders get one thing wrong about FOMC week.
Here's a quick tutorial on how to trade FOMC if you're watching the Fed this week.
Nobody talks about this: NQ ran almost 200 points into FOMC and the setup was on the screen the whole time.
- Smart money flows were green the whole way
- The smart money levels were already marked
- You could see more support going into the Nasdaq and other assets
Optimism around the war is helping risk assets, but FOMC is tomorrow and you know the Fed can change the mood fast.
Be honest, would you have taken this trade?
If you trade the Fed tomorrow, you need 2 things on your screen.
- Smart Money Flows
- News Flows
Most traders guess before FOMC. You don't have to.
mrktedge.ai/?utm_source=X&ut…
Final FOMC Prep: How We’re Positioning Gold & Nasdaq (Live) xitter.cf/i/broadcasts/1kJzDPZwq…
Friendly reminder that 3 things move oil before your chart does.
And right now, the war with Iran is a perfect example.
If you trade oil, check these first:
→ Strait of Hormuz: Any disruption to shipping can trigger a supply shock.
→ Military escalation: New attacks on tankers or energy infrastructure can send oil higher.
→ Diplomacy: Peace talks can ease supply fears and push prices lower, even while the war continues.
Oil is trading on the risk of what happens next, not just what has already happened.
You're trading the risk of millions of barrels being disrupted.
Be honest, are you watching the war or just the candles?
3 US numbers drop today and only one outcome moves gold.
Gold slipped back to $4,000 overnight. The dollar is stronger and oil is still squeezing everything, so buyers are stepping aside.
Today (ET):
- Durable goods at 8:30 AM
- Consumer confidence at 10 AM
- New home sales at 10 AM
If they land near forecast, nothing happens. A big miss or beat is what moves you, because it changes what the Fed can say tomorrow.
Be honest, are you trading these or sitting out?
MRKT retweeted
“you can’t get stopped out if you don’t have a stop loss.”
He really said this with his WHOLE chest😭
The market says hold. The market has been wrong before❌
What's your call for Wednesday's Fed decision?
Lock in your call now, we'll come back to this before our LIVE FOMC trading session!
Sign ups below👇
27%Hike
65%Hold
8%Cut
26 votes • 7 hoursLa Fed mantendrá los tipos. ¿Y ahora qué? xitter.cf/i/broadcasts/1dxYlaqnr…
