This Week’s Economic Calendar
The previous week was characterized by decoupled markets across the indexes and consolidation profiles on the DXY dollar. With indexes at all-time highs, we can only consider buy models, using the previously created highs as a draw on liquidity until markets provide a reason to do otherwise. As we’re in February, seasonalities suggest we should expect expansion across most assets, which we are currently anticipating. If we are to break out of this range, especially on the dollar, institutional sponsorship must fully return to the marketplace.
Please note that this is not financial advice.*
Monday:
With an FOMC member scheduled to speak at noon and no other significant news drivers before or after, we anticipate a relatively calm session. However, considering that CPI is scheduled for the next day, which could lead to consolidations and high resistance liquidity runs, it’s crucial to prioritize the 10 am silver bullet or the 7-8 am silver bullet in the pre-market session. Emphasis on being surgical in any executions during these times.
Tuesday:
This day brings anticipation of CPI numbers. Following the news release, we expect a surge in market volatility, which could offer favorable trading opportunities. While we avoid trading before high-impact news events, we can assess liquidity and inefficiencies afterward which are in place as a draw. Consider focusing on the 10-11 am silver bullet or the PM session for higher probability trades.
Wednesday:
On a day devoid of significant news drivers, it underscores the importance of patience and managing expectations. The recommended strategy is to await the 9:30 opening and then concentrate on identifying the most probable higher time frame draw on liquidity.
Thursday:
With red folder news expected to flood the market throughout the day, starting as early as 8:30 am, traders anticipate volatility injections that could facilitate smoother trades. Traders are encouraged to prioritize either the 7-8 am Silver bullet, the 10 am Silver bullet, or the PM Session.
Friday:
With multiple news drivers at 8:30 am and 10 am expected to inject volatility into the markets.Traders should take note that If your weekly profit objectives haven’t been met, consider prioritizing the 8:30 news embargo, the 10 am silver bullet, or the PM Session for potential opportunities.
Earnings Spotlight: Major Corporate Reports Unveiling This Week – Key Insights for Investors
Earnings Reports Impact: It’s worth noting for fellow traders – anticipate significant price movements surrounding earnings reports in large-cap companies. This period frequently offers strategic trading opportunities, capitalizing on heightened volatility for smoother trades.
While there are large cap institutional reporting earnings, neither of these will likely inject volatility in the stock indices.
The Cot Report For The US Dollar
The COTs offer a long-term macro view of price. If you can decipher the information and deduce a conclusion, as we did before, calling a reversal on the dollar before it manifested, it becomes evident. We’ve been predicting its rise since then, and with the sloppy delivery, it has been spot on.
An analysis of the Commitments of Traders (COT) report, with a specific focus on commercials engaged in hedging activities, reveals that these entities maintain a net long position. This significant insight indicates that institutions and hedgers, comprising commercial entities, currently hold more long positions than short positions in the market.
For traders, analyzing COT reports is a valuable tool for understanding the positioning of various market participants, enabling informed decisions about prevailing market conditions.
What does this signify for us as traders? For traders, since the commercials flipped bullish, as we informed you, we anticipated a shift in market structure, which has already occurred. The market remains bullish, confirmed by the commercials who are also net long. This bullish sentiment is evident in the charts, with yet another up-close bullish candle taking out buy-side liquidity in the previous week. Moving forward, the focus remains on observing how discount PD arrays support price. As we enter the current week, our outlook remains bullish.
Stay informed for sound decision-making, and always adhere to strict risk management protocols.
Until our next update, trade wisely.
Happy Trading!
Adora Trading Team
