The market bottomed when Reverse Repo peaked.The market bottomed when Reverse Repo peaked. After Reverse Repo started trending down, the market started its path up to new All time highs. Liquidity as measured by M2 has been picking up which explains why we see prices making or approaching new ATMby JK_Market_Recap0
Rally since 2022 based on Reverse Repo Drain $QQQ $SPY $SPX $NDXThe entire rally since October 2022 has been based on the rapid depletion of the Fed's reverse repo. When the RR drains rapidly, the money flows directly into the stock market. When the RR gains, it precurses a drop in the stock market. At each pivot point the stock market has followed suit. We just had the most recent pivot on March 15th through today adding 43% back to the reverse repo. If this increases further, the stock market should move lower. Shortby euphoricMeerka497900
Rally since 2022 based on Reverse Repo Drain $QQQ $SPY $SPX $NDXThe entire rally since October 2022 has been based on the rapid depletion of the Fed's reverse repo. When the RR drains rapidly, the money flows directly into the stock market. When the RR gains, it precurses a drop in the stock market. At each pivot point the stock market has followed suit. We just had the most recent pivot on March 15th through today adding 43% back to the reverse repo. If this increases further, the stock market should move lower. Shortby euphoricMeerka497901
RRP - Reverse Repo's Will Treasury and banks utilize RRP to help raise liquidity at the US Treasuryby acemoneypicksUpdated 112
The Potential Consequences for the U.S. Debt CrisisFrom zetalon.com The article by Ming Wong explores the significant financial consequences if the Overnight Reverse Repurchase Agreement (ON RRP) facility reaches a zero balance. Managed by central banks like the Federal Reserve, the ON RRP is crucial for controlling short-term interest rates and managing bank reserves. Following the trend depicted in the article, there could be a complete unwinding of ON RRP agreements by late 2023 to early 2024. This unfolding scenario would have several ripple effects: Short-term Liquidity Crunch: A zero balance in the ON RRP would severely limit short-term investment options, leading to a liquidity crunch. This would push up the demand for other short-term securities, subsequently increasing their yields. Impact on Broader Interest Rates: The rise in short-term rates would likely cause a shift in the entire yield curve, affecting medium to long-term rates. U.S. Debt Crisis: With a debt burden nearing $33 trillion, the U.S. would find itself under more pressure due to rising short-term interest rates, leading to higher debt service obligations and less fiscal flexibility. Foreign Creditor Dilemma: The increasing difficulty in servicing U.S. debt could reduce the confidence of foreign creditors, possibly leading to decreased demand for U.S. securities or even divestment. Credit Rating Risk: Credit rating agencies might reevaluate the U.S.’s creditworthiness, potentially leading to downgrades that would further increase borrowing costs. In summary, a complete unwinding of ON RRP agreements by late 2023 to early 2024 would not only lead to short-term liquidity challenges but would also escalate borrowing costs, disrupt fiscal policy, and diminish global confidence in U.S. financial stability.Shortby HugoWong0323
The Overnight Reverse Repo Facility Looks to be Bottoming OutMoney that has been parked at the Fed's Reverse Repo Facility due to the attractively high interest rates the Fed has set for money parked there has been on a steady decline since late 2022, and recently, this year we confirmed a breakdown of a Bearish Dragon, which led to a BAMM move down to complete a Harmonic M-shape. This then represented an influx of liquidity exiting the facility and effectively hitting circulation, which led to that money chasing assets and commodities. This chasing of assets and commdoities effecctively backed the 2023 Stock Market Rally. The target I had set for this move was down to the 0.886 of a Bullish Bat and now months later we can see that we came very close to it, but it would seem that rather than getting a full 0.886 retrace we are instead getting a confirmation-styled RSI reaction as price Bounces from the 1.618 Extension, which just so happens to align with an AB=CD formation it's made on the way down. I see this as an indication that the liquidity will soon stop flowing out from the facility and that liquidity will now begin to flow back to the facility, effectively taking money out of circulation, which would likely result in a decline in asset prices and a decline in the trading of Short Term Debt on the open market, which could then lead to Short Term Yields rising overall along with the US Dollar as institutions once again begin to lock up their dollars in this facility and chase yield rather than assets. Recently, I have been seeing a lot of weakness in the banking sector. That weakness may act as a catalyst for these institutions to once again park their money with the Fed, just as it did before. As always, my target for an ABCD is back to the Level of C, so we should see this rising back up about 30% before we can start looking for signs of this topping out again.Longby RizeSenpai223
The Overnight Reverse Repo Facility Looks to be Breaking DownMoney that is being parked at the Feds Reverse Repo Facility due to attractively high interest rates the fed has set for money parked at the facility has been on a steady decline since late 2022 and we have now confirmed a lower high and are looking to break down below a Bearish Dragon trend line that could be the initial trigger that gets it started to going down all the way to an 88.6% retrace or lower even. One can only speculate that the money exiting this facility will lead to more trading of short term debt on the open market, which could eventually lead to yields coming down overall and for all of this excess liquidity to chase Equities instead as the value of the US Dollar declines due to the shock of all this newly added supply of liquid cash to the open market thereby causing a loosening of market conditions.Longby RizeSenpai3
Reverse repo is breaking bullish trendThe Overnight Reverse Repos is breaking the bullish trend and slowly coming down. This means liquidity is coming back to the markets and the overnight FED fixed interest rates is no longer that attractive for the parked capital.by mihaiirimies1
If there was ever a sign that says follow the fedI am watching this closely. This will tell me if I can remain bearish or if I should flip bullish. I can not express in words how important this is, especially if you understand what this chart means......by trutrader20051
RRP the Fed's Soft Landing Tool for 2022?RRP unwind with raising rates could seem viable for a soft landing in the US equities markets and broader economy in 2022. Lots of major headwinds regardless. Thanks for reviewing. Please let me know your thoughts. Just my personal thoughts and opinions, not financial advice or education. Cheers.by deadsquare214Updated 221
RRPs - Reverse Repurchase AgreementsAn increase in the reverse repo rate will decrease the money supply - ceteris parabis. Commercial bank incentives to hide their funds with the RBI, decrease the supply of money in the markets. There is a limited leak from RRP Pool back and forth, but the overall trend remains higher. by HK_L615
Reverse Repurchase Agreements - New ATHWhee.... fear.... When the Criminals are running for the Hills... Ya may wanna consider the same.... CASH best if you have no clue what to do.by HK_L61225
RRPONTSYD. P-Modeling Pt A. Reverse Repo of Cajun Welcome Hyperspace Travelers, I only post the most interesting "coincidences". To which, I regard; there is no such thing. Can you find it? Look closely.. Don't tell anyone once you do... It's our little secret. SPX Target: 1000-800. Our future is already mapped.. Is such an absurd notion possible? Stay tuned to find out, whether in the shadows or in voiced opposition. Nature is my executioner. You are my witness. Tic. Toc. Tic. Mr. Owl.. How many licks does it take to get to the center of a tootsie pop? Infinite licks.. Thanks for Pondering the Unknown with Me, Glitch420Shortby Glitch420Updated 7723
Reverse Repurchase AgreementsThey're back.... and expanding while reducing liquidity once again as the Markets move higher. Sopping up all the spooge that is Quantitative Finance aka - Financial Engineering.. Pejorative? Hardly - the Market for Stocks is the Eocnomy. Now more than ever.by HK_L6112
Reverse Repurchase FacilityReverse Repurchases are a clear indication of excess liquidity in the Banking / Financial System. Money Center Banks have monies in excess after meeting obligations to the following: Liabilities Investments Lending An increase in the Reverse Repurchase activity will decrease the money supply. Reverse Repurchases mean that commercial banks are provided more incentives to park their funds with the Central Bank - decreasing the supply of money in the market. RRA's soak up excess Liquidity. As we can see they have broken Trends should be expected as CASH is within Overnight Reverse Repo Facilities @ $500Billion assist in providing support for overnight interest rates by acting as an alternative investment for a broad base of money market investors when rates fall below the interest on reserve balances. This is facility is not for public consumption, but Primary Broker / Dealers and Money Center Banks and Financial Institutions. by HK_L616611
Reverse Repurchase AgreementsRemains in Trend for 2022 to $2 Trillion. FED Supportive of collaterals. No end in sight... ____________________________________ Monday Coupon Purchases begin the New Year @ $8.7 Billion. FED Balance Sheet - New all-time HIgh @ $8.791 Trillion. _____________________________________ May your New Year be filled with Peace and Joy Until 2022 - HK by HK_L615510
Reverse Repos - Same Fear as SeptemberNot much to add to today's commentary. Fed Policy error, defense of the indefensible. APPLE Hanging on by a thread. Sell Confirmed. ________________________________________ Congrats to the True Believers Entry, once again near Perfect.by HK_L614412
Reverse Repurchase AgreementsA picture is worth 1000 words. Horrific dependency on FED Prop. Nullifiedby HK_L61448
Reverse Repurchase Agreements expand 60% in 1 MonthDuress is everywhere. There is no escape, while the demand for Collateral increases the Rate of Demanded Collateral continues to Rise in Yield. Interesting Times indeed. For those trading "Conventional Paradigms" ... Please check your Six. The Federal Reserve is Supplying said Collateral from its ever-expanding Balance Sheet. At a large profit no less. We simply follow the leaders and OBEY. No real need to complicate matters or Howl at the Moon, as it frankly changes nothing. Trade it until the Lights go out.by HK_L619
Reverse Repos - ATH - KarmaGeddeon Bid Expands to $1.35 TrillionNon-Financial rated Debt, Corporate Debt will begin to roll over as GDP Forecasts, although no longer provided... does not matter, the Global Economy is once again on the Steep Decline. Supply Chain Issues compound monthly, with no end in sight. The answer is, Buy STONKS, they are the New, New, New, and Improved Liquidity Economy. Stocks are the Economy for most Americans. GDP is resolved with Gains in Zombie Companies buying Trillions of their own shares. 1.6 Million Options were swapped for Tesla Friday, 52% Calls. The Gamma Squeeze for protected entities is in trade. Yeah, Naw, we'll pass for now, wait for the Pullback into the Final Stage of this Historic Bull Market. Commodities are pitching a large Bis as the Safety Trade is back in force. There will be a final Blow Off Higher into 2022 as Debt Markets join the idiocy until it all simply implodes. 2022 is going to be a very difficult year for most. Perpetual Bonds are assured, the reset there will require a degree of patience while the "Distribution Phase" requires time. Insider selling remains robust, Retails are going All-in on the YOLO. Meme's will begin to roll over and collapse into the next Sell, which is ahead. We will see how long they can continue this Distribution . Margin Debt remains elevated at Highs. INever forget Crammer issuing Buys in March of the DotCom peak for the most bloated overvalued JUNK Stocks which promptly collapsed from $600 to $0. 2022... one for the Books after 5/5 completes.by HK_L61Updated 228
Reverse Repos - All Time Highs - renewed KarmaGeddeon BidAs RR's break highs after a short period of consolidation... Panic is in the Air. It's rare Air up here and leads us to conclude we may $1.5 Trillion in Fed Facilities be afforded to the 3 Amigos. Simply, a stunning Fear within the perceived "Flight to Safety" Spoiler, it will not end well.by HK_L615
Reverse Repos - All Time Highs - flattening out as KarmaGeddeonNears... We observed similar action in the RR Pool during the 2006-2008 Period. The demand for Safety was in full force prior to Safety itself being demonitzed with $34 Trillion in TARP TALF and Ralph. Buyers are repeating the sames mistakes then as now. Increased selling pressure by paniced Retail Investors lowered prices and raised yields on corporate bonds as the Sub-Prime debacle (not the real cause, it was Commercials who failed) in the Media unfolded. We saw a 4% correction Bonds, it can be far higher this period as much as 8 - 12%, perhaps more as Safety is frankly no longer Safe but funding Degenrate Gocvernment borrowing. It took 107 years to accumulate the Level of Debt we have managed to add in 15 Months... Caution, extreme caution is highly warranted. We can only provide commentary for information - to perhaps embue far more rational decisions in the process of Capital Preservation. Everyone's going to lose a hand as we repeated more times than we care too... - HKby HK_L617
Reverse Repos - Cross All Time Highs @ 1.183 TrillionNot a Fan of Drama(s). Consider this antithetical to Drama. Safety, a great deal of it is being bought in Size. Both, The Federal Reserve and the Unites States Treasury are removing it at a rapid pace - Liquidity. This would appear counter-intuitive as the Equities Complex continues to make ATH after ATH. _____________________________________________________________ From November 2019 to February 2020, the exact same pattern repeated. Liquidity was removed, Banks tightened lending. The rest is history. It does indeed repeat. Then as now, Margin Debt had exceeded prior Highs, everyone was in and heavily leveraged LONG. The Put/Call Ratio had reached an extreme LOW. Complacency was abundant. Market conditions then, as now created immense vulnerabilities. The potential for a FLASH CRASH had never reached this extreme then. As for now, the potential has never been higher. Sentiment plays an important role as well... Confidence in the everything. Not simply Stock, but our arrangements in every manner. These are horrific at best, by any metric. ______________________________________________________________________ Charts are not the end all be all. February 22, 2020 should have taught everyone this simple edict. Accidents happen and although they may "Appear" in our Charts, there is something FAR MORE IMPORTANT and that is the underlying Fundamentals. It is more than fair to suggest the Federal Reserve can and will provide unlimited support to the Equity Complex, Bonds, Real Estate, Money Markets as well as support Fiscal Malfeasance by our Government. To a point... Global Equities look terrible, there is an accident ahead, a large and insidious event that will arrive unannounced and undo what has been done at surreal expense. It has been a long time - An extreme divergence between US Equities and Global Markets. A large and important drop in Asia's Equities Markets implies a contagion is developing and with it a hyper selloff in global equities. Divergences within our Equities Complex have NEVER been this extreme. It is referred to as Capitulation, not by you or I - but by Global Central Banks under the direction of the BIS. ________________________________________________________________________ It is near. Extreme Caution is warranted in everything. There is no date, there is no time to project, A day, a week and even a month. That said, when it arrives, gains will be lost and then some. Everyone appears to be "Anticipating" this correction. They Hedge and become fuel for the next squeeze of protection. This is all that is driving this market now, nothing more other than the need for a higher Fill. It is be design and plan. ____________________________________________________________________ Cash is a position, it is an exceptional one at times when one is confused or inexperienced. We are preparing for it now. xoxo - Hunter Killer by HK_L6110106