Myth busting: #1 Fed Funds Rate

The Fed does not call the shots -- the 3-month Treaury Bill does and it does so bigtime. Most recent examples are the wave of Fed Funds rate cuts that started in 2001 and then more recently, the hikes starting in June 2004.

See accompanying chart. It is not yet updated -- looking for a good source for updateable daily/weekly raw data. Currently shows only upto March 2004, but it starts from 1930, hehehehe.

Get a fundamental analyst laid and you've converted him into a technical one -- thus a level playing field; then conversation can begin.

All the hoopla about how the FED will stop raising rates is nothing more than the technical congestion around the 5.0% mark on the chart hitting these fatcats with a dose of Nitrous Oxide -- the first axis of resistance is readily seen at Fib 23.6 @ approx. 6.0%.

That's what technical resistances do to fundamental anal-ysts -- vast quantities of effluvium and effluent discharge from them into the psyche of innocent bystanders.

First major resistance @ 9.0% approximately.

The quest for the Philosopher's Stone continues, albeit alone but with pride, pleasure and considerable dignity.

"If you get people asking the wrong questions, you don't have to worry about the answers!"

Series: Myth busting -- Fed Funds Rate, Easy Al & DX

We scored many waterpolo goals together, but what I remember best is what he (a master of the elbow angled flingshot into the corner -- all net) said to me in a Thermodynamics exam in engineering school:

"Physics, Chemistry, me don't like, but Mathematics, you write sigma, sigma and you get marks"

That's the kind of simplicity I like.

Enter Alan Greenspan, hundreds of million-dollar per year fatcat fundamental anal-ysts, CNBC and other talking heads and you have a recipe for disaster, ruin and bankruptcy -- only if you listen to them and do what they suggest.

Don't like any of the others, but I'm partial to Easy Al.

In the everlasting, perennial quest for insight into where the venerable US Dollar Index (henceforth just simply DX or DXY) is headed, we've had to endure reams and reams of gobbledegook -- time consuming, tiring and mostly just plain wrong.

If I'm going to go broke, I'd rather do it listening to myself than to these cats.

This is a work in progress -- stay tuned! :)))

See next post.

For Bear -- your daily chart with Andrew's Pitchfork?

I've overcome my initial culture shock reading your charts -- a combination of your own advice (eat your honey! :) .... ) and a stiff dose of strong Sake .....

Interesting indicator -- I've seen it used by one of the pros @ Elliottwave International with reference to the Nikkei's bear market.

Metastock's help file gives me the basics of how to draw it, but some questions definitely come up w.r.t usage:

When and under what circumstances would you bring out this weapon?

On your daily chart of EurUsd, there appears to be a likely location for point B, i.e. the 3rd point of the pitchfork.

Would appreciate some usage hints -- some tips/tricks etc.

Much obliged

Joseph

Six secrets ... from Mr. Wave 3, Lord Prechter!

If you don't know who this gentleman is, I'll tell you -- a recondite TA writer, intransigent in his stance for Deflation and its concomitant stock market crash, he is the Elliottwave guru I salute for my lack of skills, hehehe.

Unfortunately he is not adept in the art of consummating a marriage.

What do I mean?

Well, since October 2002, he and Miss Dow Jones, despite their passion for each other, have left us in perennial suspense as to the outcome of their union, with a stalemate as each stands on either side of the matrimonial bed, gazing lovingly at each other:

Miss Dow: I offer you my honor.

Mr. Prechter: I honor your offer!

This has been repeated, back and forth for 3+ years and neither has made a move yet.

What a waste! :))

------------------------------------

Here then are 6 secrets from him:

What Every Trader Needs To Be Successful:

No. 1 A method. Any time you enter or exit a market, it must be for a predetermined reason that will also apply in the future.

No. 2 Discipline to follow the method. Without discipline, you really have no method in the first place.


3. Experience. The School of Hard Knocks is the only school that will teach you the emotional aspects of investing, and the tuition is expensive.

No. 4 Acceptance of responsibility. Don't blame the news, "insiders," "floor traders," or "THEM" for your losses. Accept responsibility, and you will retain control of your ultimate success to the extent that the market allows.

No. 5 Accommodation of losses. The perfect trading system does not exist, so your method must deal with taking losses.

No. 6 Acceptance of huge gains. When the big winner finally comes along, you need the self-esteem and confidence in your method to take all that it promises.

Parting is such sweet sorrow.

Well looks like price is trying to pull away from the channel, but alas couldn’t bring itself to say good bye, it’s had such a good time the past several days that it wanted to stay the weekend, and a long weekend to boot. Given that Monday is a holiday.


Sooooooooo……..


Stay the course, expect to see a bit of a pull back to start the week then price to penetrate the channel, fall back retest the line then all points north. Would be advisable to cover a small portion to pay for this weekends honey and will try to hang on and look to add to our northward train next week.

Will try to take a look at some other pairs this weekend, but have to go check out baby bear, something about his chair being broken…..

Wishing all a great weekend

Stay alert! -- the assault could occur anytime!

For EurUsd aficionados, you will note that a 4-hr close above 1.1931 is not the only requirement -- she must also take out the overhead Fib Ext @ 1.1934.

GbpUsd must close > 1.7458

Don't neglect to closely watch UsdChf for she is very closely related to DX -- in some unfathomable, convoluted manner, her puny 4.1% part of DX notwithstanding.

Bottomline: the mini-attack is on; but will it escalate beyond the battalion @ the Fib ext.?

I don't know the answers to these deep questions -- my name is Joseph, not Abraham! :))

EurUsd .. take 2 ... looking right into his soul!

A tramp picks up cigarette butts from the street -- for every 8 butts he finds, its as good as smoking one full cigarette.

If he finds 49 butts, how many cigarettes can he smoke?

EurUsd .. my take 1 ..

Even my best friends don't know that my job is "turning Lead into Gold!"

:))) :)))

Hummmmmmm.......??????

Just something to make you go hummmm…….

Does the past hold a key to the future?

:)

Bear

Eur Weekly View

One of the things I like to look for is what I call cut thru trend lines, basic support/resistance lines that have been tested but with more of a diagonal path than traditional horizontal approach.

These imo offer good trade setups when price intersects them, specially when other TA tools are in conjunction.



Until this view breaks down, this is the game plan for the next several months.

bear