![]() Additionally, the downtrend in the RSI has broken out to the upside, suggesting a long-term bullish reversal of the trend. On top of that, OPEC decided to cut its oil production, which suggests the price of WTI oil could head back to $109 following a falling wedge breakout on October 4. Especially when the Fed minutes will likely reveal that the FED is willing to tolerate a rising unemployment rate and sacrifice growth to achieve its objective of getting inflation back to its 2% target. Given the hotter-than-expected unemployment rate, the risks are high this week. So that may suggest that the consensus forecasts are too low. Headline CPI has beaten the Cleveland Fed’s forecast 10 out of the last 11 times and 15 out of the previous 18 times. Given how reliable the Cleveland Fed’s forecasts have been over the past year, you could see why the market might be nervous heading into those reports. The Cleveland Fed is looking for the core to rise to 6.6%. ![]() Meanwhile, core CPI is estimated to rise to 6.5% from 6.3%. Right now, the Cleveland Fed is forecasting a CPI of 8.2%. ![]() Estimates for CPI are 8.1%, down from 8.3% last month. On top of that, following the strong job report on Friday, it seems possible that worries will be high heading into that CPI print, which could prompt plenty of put buying this week as investors try to hedge themselves. That will be a lot of data and potential areas where yields could move on either economic data or demand for newly issued bonds. On top of that, there will be a 3-Yr Treasury auction on Tuesday afternoon, a 10-Yr auction Wednesday afternoon, and a 30-year action Thursday afternoon. ![]() It will easily be the most challenging week of October, with a PPI report Wednesday morning, the FOMC minutes Wednesday afternoon, and the CPI report Thursday morning. MICHAEL KRAMER AND THE CLIENTS OF MOTT CAPITAL OWN SHOP ![]()
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