Beschreibung
⋅ Calculated using net liquidity & fair value formula. Created by @maxjanderson (Twitter), summarized by @dharmatech or @Dharmatrade (Twitter).
Net Liquidity formula:
Net Liquidity = Fed balance sheet - Treasury General Account - Reverse Repo
Net Liquidity formula on TradingView:
(FRED:WALCL-FRED:WTREGEN*1000-FRED:RRPONTSYD*1000)/1000
Price scale is in billions of dollars.
Fair value formula for TradingView:
SPX - ((FRED:WALCL-FRED:WTREGEN*1000-FRED:RRPONTSYD*1000)/1000/1.1-1625)
Visualizing the Fair Value thresholds by plotting the following lines as Fair Value Bands:
FV + 350
FV - 150
I.e.:
(FRED:WALCL-FRED:WTREGEN*1000-FRED:RRPONTSYD*1000)/1000/1.1-1625 + 350
(FRED:WALCL-FRED:WTREGEN*1000-FRED:RRPONTSYD*1000)/1000/1.1-1625 - 150