Is Inflation Finally Cooling?

Essential Tips for Spotting and Trading Market Reversals

Author

Market Mastery Digest
January 17, 2025

In partnership with

Cooling Inflation, Melting Uncertainty

Can you believe that inflation might actually be cooling?

The combination of recent lower CPI and PPI figures reinforces the narrative that inflation is finally easing.

But what does this mean for us as traders?

Today, let’s explore how to make sense of these shifts, with tips on spotting trend reversals and strategies tailored for the current environment.

Last Issue’s Quiz Answer:

What type of gap typically occurs when there is no significant news and is often filled quickly by price action?

Answer: A) Common Gap. (Explanation: Common gaps are usually small gaps that occur without major news or trend changes. They tend to close quickly as the price moves back to fill the gap.)

Here is today’s quiz question:

What is a common signal that a trend reversal might be occurring?

  • A) A sharp increase in trading volume

  • B) Price breaking through a key support or resistance level

  • C) RSI divergence

  • D) All of the above

Think you know the answer? Be careful — this one’s trickier than it looks!

Answer to be revealed in the next issue. Stay tuned!

It’s been a wild start to 2025!

The latest PPI and CPI reports show signs of easing inflation.

This sent the S&P 500 and Nasdaq climbing as traders cheered the possibility of a more dovish Fed.

But here’s the catch — geopolitical tensions are still creating some uncertainty, so it’s not all smooth sailing just yet.

Every trader dreams of catching a trend reversal at just the right time.

But how do you spot one before it’s too late?

These clues could be your ticket to smarter entries and exits.

Let’s talk about RSI divergence — a trader’s secret weapon for spotting trend reversals.

Add this tool to your strategy arsenal and get ahead of the market curve.

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Whether you’re spotting trend reversals or applying strategies like RSI divergence, the key is staying sharp and adaptable.

Remember, the market is a puzzle — it’s your job to put the pieces together.