The inflation cycle & an interesting fractal.
I believe that there is a pretty clear fractal or at least a cyclical repeating pattern in inflation.
This is a very very long-term view here, so it wouldn't surprise me that nobody has noticed this because everyone is trading 15m and 5m charts.
We can see that there are two distinct cycles here with a very similar structure that seems to display some clear wave patterns.
I know I'm not using a strict Elliot Wave principle here, but that's not the point.
The point is that there is a very similar pattern emerging between the 2000-2008 expansion cycle and the 2015-2022 expansion cycle.
We have an inflation spike which looks very similar to the spike which began in 2007
If this is a fractal as I suspect, then this will resolve within 1 year and my instinct is that the forthcoming fiscal tightening regime which is being put into action by the FED is going to be the catalyst for another "event" the scope of which is unknown at this juncture.
This does signal that inflation is likely to peak right about now. That's the good news. The bad news is that this "peak" isn't going to signal happier times in the economic sense.
In fact, I am on the record as saying that the only way for the FED to get rid of inflation is to crash the assets markets.
We are also very close to a de-facto inversion in the yield curve which I think is a reflection of both the inflation panic and also the general geopolitical tensions in the bond market.
Whichever way you look at the yield curve, it is pretty clear that the bond market doesn't believe that we're going to tip back into economic expansion and especially not because the FED is embarking on fiscal tightening.
Do your own research. Happy trading.
This is a very very long-term view here, so it wouldn't surprise me that nobody has noticed this because everyone is trading 15m and 5m charts.
We can see that there are two distinct cycles here with a very similar structure that seems to display some clear wave patterns.
I know I'm not using a strict Elliot Wave principle here, but that's not the point.
The point is that there is a very similar pattern emerging between the 2000-2008 expansion cycle and the 2015-2022 expansion cycle.
We have an inflation spike which looks very similar to the spike which began in 2007
If this is a fractal as I suspect, then this will resolve within 1 year and my instinct is that the forthcoming fiscal tightening regime which is being put into action by the FED is going to be the catalyst for another "event" the scope of which is unknown at this juncture.
This does signal that inflation is likely to peak right about now. That's the good news. The bad news is that this "peak" isn't going to signal happier times in the economic sense.
In fact, I am on the record as saying that the only way for the FED to get rid of inflation is to crash the assets markets.
We are also very close to a de-facto inversion in the yield curve which I think is a reflection of both the inflation panic and also the general geopolitical tensions in the bond market.
Whichever way you look at the yield curve, it is pretty clear that the bond market doesn't believe that we're going to tip back into economic expansion and especially not because the FED is embarking on fiscal tightening.
Do your own research. Happy trading.
