Futures nailed our next downside target last week, and are slipping a little more this morning to test a key channel line.
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Author: pebblewriter
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FOMC Decision Day: Sep 20, 2023
Futures are up moderately in advance of this afternoon’s FOMC meeting.
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Charts I’m Watching: Sep 18, 2023
Futures are off slightly as we approach the open, with an FOMC rate decision and plenty of economic data in the week ahead.
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Charts I’m Watching: Sep 15, 2023
The OPEX overnight ramp faltered with news of the UAW strike. Futures are currently off slightly despite VIX falling to levels not seen since Jan 2020.
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PPI Confirms Inflation Increase
Like CPI yesterday, PPI confirmed rising prices that topped estimates. The 0.7% MoM headline increase was the highest since June 2022.
source: Bloomberg Algos, however, are more focused on the continuing decline in VIX.
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CPI Tops Estimates: Sep 13, 2023
August CPI came in at 0.6% MoM and 3.7% YoY, slightly higher than expectations. Core CPI was 0.3% MoM and 4.3% YoY, also higher than expectations. This is in line with our forecast, driven largely by higher costs for rent, transportation, and energy.
Futures are flat ahead of the open…
…with VIX making lower lows on algo trading. 
Rising inflation, driven largely by YoY comps for energy prices, should make a Fed pause less likely.
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Charts I’m Watching: Sep 12, 2023
Futures gave back most of yesterday’s gains overnight as the August CPI print approaches.
Our gas price model suggests headline CPI is due for a significant increase.
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Charts I’m Watching: Sep 11, 2023
Futures are up about 0.50% percent on a rebound in tech shares.
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Food for Thought
There’s some good research on marketwatch.com this morning that illustrates the fact that no interest rate inversion (10s1s) in the past 70 years occurred without a subsequent recession. The average lag was about 14 months, meaning that we’re now officially overdue.
Furthermore, none of the post-inversion equity rallies lasted. Every single one was completely reversed, resulting in a bear market. Food for thought.It’s another quiet morning so far, with futures flat for the most part after testing our 20-day moving average target yesterday.
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