Sunday, June 12, 2016

The Week Ahead: Money Policy Meeting

The much anticipated and thoroughly parsed Federal Open Market Committee meeting happens this week, a two-day affair ending on Wednesday with an announcement and fresh forecasts at 2 p.m., New York time and a news conference with Fed Chair Janet Yellen at 2:30 p.m.

It had initially been expected that the Fed would raise rates again in June, but the odds appeared to lessen after a sharp decline in the pact at which jobs are being added to the economy.

A report with a bearings on interest rate decisions, the consumer price index, will be poublished Thursday at 8:30 a.m.

Other important economic reports scheduled for the week: On Tuesday, retail sales on Tuesday at 8:30 a.m.; on Wednesday, producer prices at 8:30 a.m. and industrial production at 9:15 a.m.; on Thursday; and on Friday, housing starts at 8:30 a.m.

Leading indicators (in descending order of importance):

The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.

The M2 money supply, at 4:30 p.m. Thursday.

The S&P 500 index, reported continually during market hours.

Average weekly initial claims for unemployment from the jobless claims report at 8:30 a.m. Thursday.

Building permits for new private homes from the housing starts survey at 8:30 a.m. Friday.

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Events arranged by day:

Tuesday: Retail sales and import and export prices, each at 8:30 a.m., and business inventories at 10 a.m.

Wednesday:  Producer prices and the Empire State manufacturing survey of conditions in New York, each at 8:30 a.m., industrial production at 9:15 a.m., petroleum inventories at 10:30 a.m., FOMC meeting announcement and FOMC member forecasts at 2 p.m., Fed Chair Janet Yellen news conference at 2:30 p.m. and the Treasury Department international capital report at 4 p.m.

Thursday:  The consumer price index, jobless claims and the Philadelphia Federal Reserve business outlook survey of conditions in the mid-Atlantic state, each at 8:30 a.m., the Home Builders' housing market index at 10 a.m. and the M2 money supply at 4:30 p.m.

Friday: Housing starts at 8:30 a.m.

I also keep an eye on the Baltic Dry Index, updated daily, and the 5-year implied inflation rate based on U.S. Treasury yields, which presently stands at 1.51%, up four basis points from a week earlier.

Treasury Debt

  • 4-week: Announcement Monday 11 a.m., auction Tuesday 11:30 a.m., settlement Thursday.
  • 3-month: Auction Monday 11:30 a.m., announcement Thursday 11 a.m., settlement Thursday.
  • 6-month: Auction Monday 11:30 a.m., announcement Thursday 11 a.m., settlement Thursday.
  • 52-week: Announcement Thursday 11 a.m.
  • 2-year: Announcement Thursday 11 a.m.
  • 3-year: Settlement Wednesday
  • 5-year: Announcement Thursday 11 a.m.
  • 7-year: Announcement Thursday 11 a.m.
  • 10-year: Settlement Wednesday
  • 30-year: Settlement Wednesday
  • 30-year: Announcement Thursday 11 a.m.

There are no scheduled public appearances by the Federal reserve glitterati outside of the Fed Chair Janet Yellen's news conference on Wednesday at 2:30 p.m.

Analytical universe

This week I shall be analyzing new trading signals from among 482 large-cap stocks and exchange-traded funds.


Money well managed deserves, indeed, the apotheosis to which she was raised by her Latin adorers; she is Diva Moneta -- a goddess.

--Edward Bulwer-Lytton, "On the Management of Money" (1864)

Good trading!

-- Tim Bovee, Portland, Oregon, June 12, 2016


Tradecraft: Playing the odds to build winning stock market trades from options, a description of how I trade, can be read here.


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Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.
No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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