Week Ahead Strategy: Interesting Thoughts Heading Into The Week
Powell's Going To Make Some Moves!
I hope your weekend went well!
If you didn’t catch the article from yesterday, here it is. There are some great macro thoughts in it:
We have a full week ahead with multiple catalysts that will be moving both equity and bond markets. I will go through the events, provide some observations and then share how I view the risk-reward of assets moving forward.
The never-ending game of markets and life continues!
We have the economic calendar with some housing data and PMI data. Initial claims continue to cause algo spikes in bonds so watch out for those. Durable goods might move things a little but positioning will likely be looking to Friday for the speech by then.
The main event of the week is Powell's speech at Jackson Hole.
Let me explain how I am thinking about FED speeches right now.
At the moment, the market believes that Powell is done hiking and that cuts are on the table in Q1 of 2024:
Eventually, Powell is going to have to either confirm or deny the possibility of cuts in Q1 of 2024. So every speech is a catalyst to confirm or falsify this idea.
I have a very different view from the market which connects to how price action is likely to function this week.
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