FED Giveth, FED Taketh

Is Bond Market “Ridiculing” FED, or Vice Versa?

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BraVoCycles Newsletter
December 19, 2024

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  • There is so much to analyze and talk about after yesterday, but I could do only so much in an intraweek newsletter. Probably more in Sunday’s Premium newsletters.

    • The FED Chairman Jerome Powell said yesterday “The Economy Is In A ‘Really  Good Place’,” after cutting the rate by 0.25%.

    • But if economy is in a ‘Rally Good Place’ and inflation rose unexpectedly (by non-informed) for two consecutive months, why did the FED cut rates? Does it make sense to you?

    • Remember that a day before the FED’s 1st rate cut in September I said ‘sell the rumor, buy the news’, referring to yields.

    • Indeed, yields and US Dollar started to rise strongly after that 1st rate cut. Same yesterday after the FED’s announcement.

  • About newsletters:

    • They say free subscribers like short newsletters, while premium subscriber like long newsletters.

    • I am not sure if this is 100% correct, but we tend to follow these guidelines.

    • If you are an engaged subscriber, check out our Market Twists & Turns Pro, there is always a 14-day Free trial: https://bravocycles-newsletter-market-timing.beehiiv.com/upgrade

    • You could profit from incredibly insightful market analysis and at the same time master super advanced Real Technical Analysis (TA + Elliott Waves + Time Cycles + Cycle Price Projections) that you could not find all in any other newsletter.

Volatility Forecast, VIX and VXX

  • Yesterday I posted in the Premium Newsletters an incredibly detailed and insightful VIX and VXX analysis.

  • Long story short, I predicted a 49 target for VXX,

  • I also said VXX may overshoot but will likely be stopped in the 52-55 20-week cycle FLD band and pull back to mid-to-low 40s. Read about FLDs in Price Projection lessons in Educational Resources: educationsl resources | Market Twists & Turns by BraVoCycles Newsletter

  • I also presented a method that calculates a VXX target to at least over 100, after a pullback.

  • Amazingly, my prediction was realized the same day.

  • After the FED’s announcement and in after-hours trading VXX spiked to 53.7 which is in the middle of the 20-week cycle FLD band, and in the after-hours trading it revisited the target range, as of my writing this section.

  • However, there is no usual pronounced negative divergence in RSI at the afternoon peak, except a mild one on 1-min chart. It is likely that VXX might make another slightly higher high with simultaneously lower RSI level, before pulling back noticeably.

  • Is it the FED, or is it the cycle constellation setup? Or both.

  • Is it clairvoyance or BraVoCycles’ multi-pronged advance technical analysis? You judge.

Watch Us on Youtube

  • Check out our latest YouTube video about Dow Jones Industrials. You do not want to miss it.

  • Consider following me on X (former Twitter) in addition to the newsletter, as I often post valuable information there in real time between the newsletters.

    • Yesterday I posted a Bitcoin Elliott Wave chart that I normally post in the Pro newsletter.

    • There are two competing paths, green and blue, toward the 3.6-year cycle target range of about 110K-130K, which I think I posted before.

    • The blue count corresponds to an ending diagonal (see yesterday’s lesson). There is now an overlap of wave i and iv, as expected for diagonals. If BTC drops notably bellow the lower trendline of the diagonal (lower dashed blue line), the green path/count wins, or it could be an expanding ending diagonal which has a smaller probability.

    • The green count corresponds to an expanded flat for (iv) after which (v) can be either a normal impulse or an ending diagonal.

Watch out for the Weekend newsletter. We will review forex/USD or bonds, maybe also crypto if there is anything new.

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