Hey There Income Hunter,

 

Stock indexes rolled over last week as volatility increases were fueled by an even more hawkish Federal Reserve.

 

The Federal Open Market Committee (FOMC) minutes made it clear that the Fed plans to fight soaring inflation sooner rather than later – and in greater magnitude than expected.

 

• A rate hike of 50 basis points is now probable at the next FOMC meeting on May 4, and more such hikes are likely at future meetings.

 

• Quantitative Tightening (QT) of up to $95 billion ($60 billion US Treasuries, $35 billion Mortgage-Backed Securities) is set to begin as soon as the May meeting.

 

• Total QT could result in balance sheet reduction of as much as $1 trillion a year. This is far sooner and of greater magnitude than expected.

 

The bottom line is that this blueprint for tightening is based on a strong economy that can handle such a squeeze.

 

This week will give us our first look at the important data for the first quarter, which will illustrate how strong we can expect the economy to be in Q2 … 

 

>> Click here to join me as I go live to reveal profit-making opportunities based on this information. <<

 

But first, today I’ll share some of the important data and charts to monitor for trade ideas and signs of new trends to come

 

SPDR S&P 500 Index ETF (Ticker: SPY) 

 

Friday was a key reversal day for SPY as call buying and put selling fueled a rally at the start followed by heavy call selling throughout the day and into the close.

 

By the end of the week, SPY experienced significant technical damage, including …

 

– Weekly close below the 200-day moving average

– Selling volume picked up 

– SPY volatility was higher on the week

 

 

I expect to see volatility trend even higher this week with a chance we could see SPY break below the 50 DMA and test 440.

 

iShares 7-10yr Maturity Treasury Bond ETF (Ticker: IEF)

 

The Fed continues to fuel the selling of Treasury Bonds with its  ultra-hawkish rhetoric … 

 

Checkout the most recent market price of rate hikes over 2022 …

 

 

Almost 9 rate hikes of .25% are now priced into Treasury Bond ETF prices. I initially believed we would only see 2-3 hikes this year but after the Russian invasion I increased my forecast to 4-5 hikes.

 

I continue to believe 4-5 will be enough to cause significant damage to the markets and the economy, causing the Fed to back off the additional hikes.

 

This will fuel an uptrend in the price of IEF, but with $100 billion in bond supply this week I want to look for a better set-up to buy…

 

Ultimately I want to build up a position in IEF with expectations for a move back to 108 by the June 17 expiry.

 

ETFMG Junior Silver Miners ETF

 

The precious metals have put in a valiant performance when you consider how strong the US dollar index has been plus the incredible uptrend in interest rates.

 

Dollar strength and higher interest rates have historically put a lot of pressure on silver and gold, but investors money flows have increased due to two very important developments:

 

– Geopolitical risks of Russian invasion demand a move out of financial assets into precious metals to protect savings

– The narrative on the Fed shifting to an eventual move back to QE and stimulus, which will be very bullish for silver and gold.

The junior silver miners are the cheapest sector of the precious metals complex (see chart below) …

 

Many of the stocks held in SILJ are still relatively close to their one-year lows …

 

If Silver and SILJ break out higher this week we could see SILJ make a quick move to 18.

 

Bring It Home

 

This is shaping up to be a pivotal week for the markets, as investors will be bidding on over $100 billion in bonds.

 

With rates at the highest levels since early 2019 the auctions should be well bid … but the Fed has certainly done its best to scare investors, so we shall see.

 

The critical data to watch for this week is CPI on Tuesday, PPI on Wednesday, and retail sales on Thursday. Below is a full list of data and Fed speakers …

 

I see two massive moves coming based on the powerful money flows driven by Fed policy and the global macro forces driving a transition to a new commodities backed monetary system. 

 

I have been making a killing since I first called for much higher inflation in mid-2021 and then called the bear market starting in November of the same year.

 

Now my Power Income System offers subscribers an inside look at all the trades I’m doing – and inside info on Fed policy and where money is flowing. 

 

Plus, I provide a watchlist of stocks that are in play each week and offer live events to cover major changes in policy, data and money flow.

 

>> Join me this Wednesday at 11am for a deeper dive into the driving forces behind these massive moves I see coming plus a trade I am doing right now to capitalize on recent trend reversals. <<

 

Live and Trade With Passion My Friend,

Griff