FOMC Wednesday 15th June 2022

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https://www.wsj.com/articles/bad-inflation-reports-raise-odds-of-surprise-0-75-percentage-point-rate-rise-this-week-11655147927

1. Gazprom halts one more compressor, squeezing flows to Europe.

2. China’s President Xi: China is to support Russia on sovereignty and security.

3. ECB’s Wunsch: The ECB are very open to stepping in if markets overreact.

4. ECB to discuss reinvestment of PEPP bonds at the emergency meeting.

5. EU Financial Services Commissioner Designate McGuinness: There will be important EU announcements today.

6. EU Financial Services Commissioner Designate McGuinness: We ask the UK to come back to the negotiating table.

7. Israel, EU to sign a natural gas export deal on Wednesday – Israel’s energy ministry.

https://t.co/dveEj8leDa — The Balanced Trader (@Trading_Balance) June 15, 2022

Today’s Data

INTO THE FOMC

PRE FOMC

INTO THE FOMC -ALL BETS ARE OFF

An aggressive move out of balance followed last week’s ECB and CPI saw the auction leave multiple poorly auction areas that may need to be reauctioned at some point. Hold on to that thought. For that to happen, we will need to see an end to the OTFD. The auction continues to see sellers chase down, which has left us in our current 2-day state of overlapping balance between 3819 and 3708.

The current two-day action is balanced, so I will monitor the extremes and look for change. It is hard to talk about technicals and auctions when we are so near to possible fundamental shifts in regime from central banks.

2-day VPOC is now at 3740, and the buying tail left over from yesterday’s auction must be monitored carefully; buyers will want to protect the spike 3723 before the yearly lows of 3708.

A failure of buyers to hold on to these crucial levels will be an ominous sign of more to come to the downside, and I will be looking at 3650 a HTF target.

Should we trade and hold above the two-day auction VA 3779. Then I will look for the prior month’s highs and 3809 and 2-day highs at 3819—an intermediate target above 3857.

The auction is now out of balance on the monthly, and the objective of buyers is to end the daily OTFD and bring it back inside the prior month’s range. It managed to trade back inside on Monday but for a few TPOS.

MONITORING  2 DAY PROFILE 

H 3819 L 3708 VPOC 3740 VAL 3732 VAH 3779 TAIL 3723

TOP TIP: FOMC MOVES CAN BE VERY, VERY WHIPPY. You don’t have to trade the initial moves and wait for PA to settle, then monitor the auction and areas that are being respected and executed.

On average days I favour technicals over fundamentals, but on major MACRO events, it’s the other way around, and technicals are my guides for execution.

Quote Of the Day

“We tend to use [the word transitory] to mean that it won’t leave a permanent mark in the form of higher inflation,” Fed Chairman Jerome Powell told Congres

Trade Well And Prosper.

BT