Fed, Trump and EUR/USD: Levels, Ranges, Targets
|As Trump's Inauguration speech not only indicted an unresponsive political system inside a bloated government but Trump delivered this speech to the dignitaries, political party leaders and past presidents. We haven't heard these words since Reagan left in 1988. Trump's main point was Washington elites became wealthy as populations became poor. Now the political system spends its most unproductice days to tie Trump to Russia in order to destroy his presidency. The political class failed to read Walt Whitman's Leaves of Grass, Do anything but let it produce Joy.
Trump's greatest threat to the system is tied to economics. Capitulation to stimulus in 2008 changed economics from Reagan's Austrian Supply Side to Keynes. New models were created in 2013 by central banks, called New Keynesians. Central banks apply the old tired equilibrium models to Keynes and it resulted in unproductive economics. GDP failed to produce a 3.0 reading in 8 years.
Why Trump's tax fight will be massive is because if Trump is successful in passage then the economic system will switch again to Austrian Supply Siders and the pure price system. Austrian economics is a direct confrontation to Keynes top down, government control over the economic system. if government power diminishes then the private sector and masses becomes the beneficiaries. If Trump is successful then the Austrian price system will reign for many years in the future.
As the Fed Board constitutes a majority of Keynesians and Keynesians love stasis economic conditions, why the rush to raise Fed Funds is unknown yet I'm highly skeptical of the motivations. Interest rate rises and falls are traditionally based on current economic conditions not what might be the case in the future. Conspiracy would ask, is the economic system aligning against Trump as well.
EUR/USD. Big line breaks today are located at 1.1107 , 1.1244 and 1.1308. Yesterday's 5 day average in the 1.1160's is now 1.1181 and EUR/USD trades below. Noted point is EUR traded to the 1.1160's as mentioned.
We continue to look for a lower EUR/USD to 1.1119. How this achieves is by breaks at 1.1147, 1.1133, 1.1125 then 1.1119. The level at 1.1125 is the current 10 day average and doesn't require to pay much attention to it as the averages, as perfect as mine are, hold little credence to the daily system.
On a possible bounce today, targets and sell points are located at 1.1204 and 1,1229. Overall EUR/USDr anges are contained at 1.0931 and 1.0914 to many points in the 1.1400's. USD/JPY ranges as well as buy and sell points are located from 111.32 and 111.38 to 112.59.
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