Updates for Tuesday 9/14/21

We trade 3x ETFs such as TQQQ TNA SOXL LABU UVXY using proprietary analysis of volatility. 

​Updates 12:30 AM EST - Tuesday 9/14/21

Inflation
The CPI report comes out at 8:30 AM EST on Tuesday, and the numbers will be carefully analyzed and parsed.  According to the NY Fed Survey, Americans see inflation a year from now at 5.2%, up from expectations of 4.9% last month. Three years from now, it is expected to be at 4%, up from the 3.7% expected in July.

Expectation is not the same as reality, but expectation can drive a lot of decisions and factors into pricing mechanism.   According to Atlanta Fed President:  “if businesses and families are starting to make decisions, taking on board these higher levels of inflation as something that is potentially more permanent. If those sorts of behavioral changes start to play out, then that’s something I’ll have to take on board”.

The talk of inflation runs hand in had with the talk of tapering. Next Wednesday 9/22 is FOMC announcement.   Here is an in-depth look at what the Feds are planning possibly.

Here are some key charts that we are monitoring.   They provide mixed messages right now, but keep an eye on them anyway.   

​$VVIX:  Volatility of $VIX
The most important chart is $VVIX.   We will rely on it for signs of capitulation as explained below.   When the volatility of $VIX maxes out is when market will calm down again.  

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