The core theme is how recent unprecedented political pressure on Federal Reserve Chair Jerome Powell, including a federal inquiry, can be interpreted as a catalyst for anticipated interest rate cuts, leading to potential US dollar weakness and opportunities in safe-haven assets like gold and silver.
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Hey guys, hope you're well. In this
video, we're going to be going through
some pretty crazy things that have been
happening with Jerome Pal at the moment
and how you can actually use this
information to catch trades. For
example, here on gold and here on
silver, both of these trades were taken
off the same reasons with Jerome Pal.
And this is what we're going to get into
in this video. So, let's get into it.
First things first, the Federal Reserve
is obviously the central bank of the US.
Right now, the Fed is an independent
entity. I want to stress the word here
independent. Now, the goal of the Fed is
their dual mandate, right? Which is
maximum employment and stable prices.
stable prices as in just meaning a
control of inflation, right? So, this is
their goal, the dual matter. That's
their main focus. What they want to pay
attention to the most. Now, because the
Fed is an independent entity, they don't
want to pay attention to other things,
right? For example, they're not going to
pay attention to politics. They're not
trying to get involved. Their goal is
the dual mandate, maximum employment,
stable prices. Okay? So, basically
what's been happening is that for a
while now, Trump is obviously wanting
lower rates, right? He's been pushing
very, very hard um specifically on
Jerome Powell, which is obviously the
chair of the Fed. um be pushing him very
very hard to to cut rates, right?
Because obviously Jerome Pal being the
chair, he has a very big control over
these rates, right? He can't obviously
he can't make it exactly what he wants.
There is a board, they vote, but he does
have a very big influence over that
board, right? Obviously because he's a
chair. Now, what's happened as a kind of
another step up is what's happened is
that the US federal prosecutors have
basically opened an inquiry into Federal
Reserve Chair Pal. Okay, so this is
basically another push towards lowering
rates. Um it is a very very big push.
This is not something uh yeah this is
pretty big deal um and it's going to
yeah another very serious push to to
kind of pressure um Juran Pal into
cutting rates and also going to put in
question the Fed's independence right so
first we have to think of you know how
is this actually going to affect what
we're trading okay so they want him out
obviously because they want more
interest rate cuts okay so what do
interest rate cuts actually do now what
do they do they are going to generally
weaken the currency I put generally here
because there are different situations
where we might see different reactions
but obviously I'm not going to go
through them here. But as a general rule
of thumb, when we do have interest rate
cuts or we are pricing in for interest
rate cuts, we're typically going to see
that currency weaken. Okay. Now, the
fact that they're going to the extent of
basically launching a criminal
investigation against PAL really shows
you how badly they want to cut rates,
right? And it also shows that PAL is not
really set on cutting rates, which is,
you know, it's it's pretty insane that
they have to, you know, go to this
length of basically, yeah, launching a
criminal investigation for him to, you
know, to try and get him to crack to try
and get rid of him, right? So what is
this going to do to the US dollar? So we
can obviously see you know here how
badly they want rates to cut. We can
also understand that Pal's term is
ending soon. So the obviously the new
chair is going to be very aligned with
the president what the president wants
which is going to be rate cuts. So with
all this information right we obviously
we're going to get US dollar um
weakness. Okay. Because we know that the
next step inevitably is going to be rate
cuts. But now they're pushing so heavily
um for example you know launching a
criminal investigation. They're pushing
so heavily to get him out to try and get
cuts. you can understand that they are
going to really really want cuts and
when they get it their way there's going
to be some serious serious cuts right
which is going to cause US dollar
weakness okay so based off this
information we're going to expect we're
going to typically see US dollar
weakness right now something else really
important to pay attention to is
actually the Fed independence right if I
come back to here obviously the Fed is
an independent entity but by you know
looking at all this stuff that we've
been going through it doesn't really
show that the Fed is that independent if
they are going to crack if you know if
certain things happen right and that
puts obviously the Fed independence in
question. This is also a very very big
deal and this is going to cause a lot of
uncertainty, right? So obviously when we
have uncertainty in the markets, we
don't know exactly what's going to
happen. We're going to see those safe
havens typically gain strength. Okay, so
for example, we're going to see gold
upside, we're going to see silver
upside. Okay, obviously there's going to
be a lot more reactions, but I'm just
going over these two because this is
what I actually traded. Okay, so we have
the US dollar weakness and we have gold
upside and silver upside. Okay. Now,
also we can come to Pal's comments and
here we can see here that he says um the
threat of criminal charges is a
consequence of the Fed setting interest
rates based on its assessment of public
interest rather than the president's
preferences. Okay, which is um yeah,
it's a pretty crazy statement. It's kind
of half ridiculous, half pretty scary.
Um and then we have the next comment
here which is a broader issue is whether
the Federal Reserve will continue
setting interest rates based on evidence
and economics or be directed by
political pressure and intimidation.
Right? Again, stemming back to the Fed
independence in question, right? Are
they going to do it how they have been
doing it based on evidence and economics
or are they going to be, you know what I
mean? Are they going to be
non-independent and focus on politics?
Um, right here, political pressure and
intimidation. Okay, this is yeah, again,
very big deal. Now, again, the last one,
he has a deep respect for the law, but
calls action unprecedented and it says
and says it should be viewed in the
context of administration ongoing
threats against the central bank. Right.
Again, Fed independence in question. are
they really their own entity? We're
going to see, you know, big big things
are going to happen um this year, right?
So, basically with all this information,
we can see that we're going to expect
with from this release, we're going to
expect US dollar weakness and then we're
going to also expect gold upside, silver
upside. Okay, so now let's jump onto the
charts so I can show you everything that
I'm doing technically. Okay, so this is
the gold trade right here. First, we'll
go over this one and then we'll jump
over to the silver one. Okay, so this
trade actually got in a little bit
later. I got this we got the information
related 11:05 my time, I believe. If if
you're in New York, that will be around
7:05 p.m. Um, and you can see here that
I got in around 11:10 to 11:15, right?
So, a little bit later, but nothing too
crazy. So, basically, we get the
information, right? Like I've explained
previously, we're expecting that dollar
weakness. We want to see that gold
strength. So, if I come over to the DXY,
which is the dollar index, we can see
right at 11:05, we do get quite
aggressive weakness. Okay, keep in mind,
we're actually in Asian session as well,
right? So for us to get this weakness on
the US dollar this aggressively in the
middle of Asian session means that
whatever is happening is something quite
significant right and obviously what we
what we've discussed what we've been
through before is very very significant.
Okay. Now, in terms of technical
analysis, I did not use much technical
analysis at all with this trade. Um,
partly because there wasn't much
structure and if I waited for, you know,
a setup to happen, a structure point to
form to then break. Um, it probably
would have missed this move, right? And
also because, you know, we are getting
this aggressive weakness. We can see
that the markets are reacting. This is
such a big kind of situation that's
that's kind of taken place. Um, I don't
really need to wait for those
technicals, right? I have the
fundamental reasons and I can enter um
if when I can see what's actually
happening, right? So we enter right
here, place my stop loss below this kind
of tiny structure point here and then
you can see immediately we get straight
into profit and we push up quite
aggressively. Right? Hence obviously
following this but obviously the
opposite because gold is the secondary
currency, right? So uh this green line
here represents my take uh my partial
takeprofit. Right? So if you can see
here um uh this is called a pivot point.
I don't know if I've mentioned this in
some of my other videos. Basically this
is an indicator I use. It's called pivot
points. Um you can see here we hit at
1140. We hit this pivot point. Again,
I'm not expecting this aggressive
weakness to last forever. So, I want to
kind of capitalize on it as much as I
can and then and then take take some
profits, right? So, you can see here
1140, we do hit this pivot point. And
that is exactly at 1140 here when I do
decide to take some partials. Okay? So,
I take my partials. Once we kind of
range a bit, once we break this high
again over here, I'm moving my stop loss
below this low and I'm basically letting
that those partials run. And you can see
they're running quite nicely right now.
Right. So, if I come over to silver, we
have kind of a similar story. Um again
got in this trade a little bit later I
entered on gold first then on silver um
we can see here at 11 1110 11:15 entered
here moved straight into profit stop
loss below this structure point right
here again at 1140 and see this kind of
wick of a candle up here hitting this um
hitting this uh pivot point taking
partial I didn't take as heavy of
partials on gold uh on on silver as I
did gold right so I wanted to leave a
little bit more um yeah a little bit
more on the table to see what what
silver could do because I did take quite
a big chunk out on gold. Also, um
actually I'll mention here if you watch
one of my previous videos when I'm
talking about geopolitical tensions,
this is a trade that I I I think I broke
down. Yep. Um explaining here and I'm
actually still holding both of these up
here, right? Letting them run.
Obviously, I've taken partials, but I'm
letting those runners run. So, we can
see here on silver, this trade is going
absolutely fantastic. Um we can see we
pushed up as we broke this high again,
moving my stop loss below this structure
point right here, and I'm letting that
ride. Okay. Um I am still holding both
of these. Obviously, I don't have that
much on gold anymore. But I do have a
decent position on um on silver. There
were obviously quite a few things that
have been happening on the past few days
through throughout all this kind of um
ranging and you know, all this kind of
price action. Um so I'm not sure what's
going to happen yet. Obviously, we got
to keep our eyes peeled. Um um yeah, I
could close this, you know, in a few
hours, close this in a few days. I don't
know when. Obviously have to keep
updated with what's happening. But um
yeah, so I hope this video was helpful.
Hope you found this educational. Hope
this was yeah, informative. And I'll see
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