Eliott Wellenbach, vice president and institutional ETF strategist with Direxion, joined Cheddar News to explain how investors are bracing for interest rate hikes after last week's inflation report and ahead of the Fed's upcoming meeting. Wellenbach also discussed how traders are taking advantage of volatility as earnings season continues and amid geopolitical conflicts.

<div class="block">Eliott Wellenbach, vice president and institutional ETF strategist with Direxion, joined Cheddar News to explain how investors are bracing for interest rate hikes after last week&#39;s inflation report and ahead of the Fed&#39;s upcoming meeting. Wellenbach also discussed how traders are taking advantage of volatility as earnings season continues and amid geopolitical conflicts.</div>

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How Traders Are Bracing for Upcoming Fed Meeting & Amid Geopolitical Conflicts

Trader nation brought to you by direction. ETF we explore how investors and traders can position their portfolios for the future with directions expanded suite of et So joining me now is Elliot Wellen Bach, Vice President and Institutional ETF strategist at direction, Elliot, welcome Kristen. Thank you for having me. Happy to have you. Well, after last week's inflation report and the upcoming fed meeting, how are traders positioning themselves for interest rates? Yeah, last week we saw higher CP I and PP I numbers. Um you know, the training's really been data dependent. Um and there's an upcoming fed meeting, November 1st will be the next decision. We've seen a lot of active and short term traders looking to uh trade our interest rates. So through our 20 plus year uh Treasury uh three XB and Behr ETF. TMF and TMV, uh playing both sides of the yield curve. Um And actually, we've seen the heaviest inflows here today into our uh our ETF suite into TMF, which is our B uh 20 plus year Treasury ETF. Um A lot of contrarians looking to um see reversal, see rates move lower. Um And if you know, you're looking to play the shorter end of the curve, the 10 year just hit its highest yield, uh, recently this month since uh 2007, we do have a 7 to 10 year, uh, Treasury Bull and Bear ETF uh three X that's Tyo and Tyd. So it's playing more of the shorter end of the curve. And, you know, we're really seeing trade looking at the fed funds futures at the moment, which is looking a little bit less likely right now for a hike in November. Well, big banks kicked off the third quarter earnings season last Friday and more banks have reported this week. How can traders take advantage of volatility around these results? Yeah, exciting to kick off Q three earnings last week. Banks led the charge so far, the financial select sector, which is the largest US, banks and financial institutions within the US, approximately half of that basket has reported so far. Um And trading is really picked up around the headlines. We have a three X uh bull and be ETF off the financial select sector, fa S and FA Z uh which we've really seen an uptick in trading uh pre and post earnings. Um and if you're looking to the smaller regional banks, um a majority of that basket is reporting this week. Uh the regional banks are coming off a tougher year following the collapse of Silicon Valley Bank. And so eyes will really be on gains or losses and deposits which are really crucial for the small banks which rely heavily on the lending business. Uh We do have a regional bank select sector ETF D PST. That's actually fared better so far this week than the larger financials uh D PST that triple leveraged uh full ETF of ours is up double digits. Um So we're seeing a lot of short term opportunity in a beat up sector that traders are looking to. Well, geopolitical risks. Uh these days are certainly front and center. What are some sectors that could provide short term trading opportunities? Yeah, the unfortunate events that happened over the past couple of weeks, over in the Middle East with the Israel and Hamas war. We've seen a lot of short term traders looking to aerospace and defense stocks. We do have a triple leverage, Dow Jones us, aerospace and defense ETF DFEN defense, um which we've seen up double digits since the start of this conflict and actually one of the largest names in that basket has reported actually yesterday, Lockheed Barton. So we're seeing some pretty heavy trading and pick up in the defensive names over the past couple of weeks and then also more on the energy front, you know, ongoing geopolitical risks around energy and oil with the ongoing Ukraine Russia war, as well as more recently, some conflicts in the Middle East. Um You know, we've seen an uptick in trading around energy and specifically energy equities. So, you know, we've seen, you know, really a short term um you know, interest in our energy select sector. ETF which is two X Bull and Bear product X and er Y. And if traders are looking to get a little bit more specific, we do have S and P oil and gas exploration production. Uh ETF S, they are both two X uh gush and drip and we've seen actually en energy equities, outperforming energy uh since the start of this conflict, what are different ways? Elliot to trade headlines with Tesla earnings after the close tonight? Yeah, yeah. In your earlier segment, I heard uh uh you and uh Hannah talking about uh Tesla and, and how much uh Hannah loves her Tesla. And uh you know, it's a very polarizing stock uh earnings after the bell today, probably the biggest, uh you know, earnings announcement so far this year. Um And so we traders gonna be looking at, you know, possible insights, uh and, and commentary. Um from that call after the bell today, we have a single stock ETF S uh the Bull and Bear side ESLL is our 1.5 Tesla ETF and then TSLF is our single inverse uh Tesla ETF and we've seen throughout the year, but especially around earnings season and today, um you know, leading up to the announcement, some heavy trading, um the focus is really going to be on, uh you know, fear of, uh you know, uh continue cutting sticker prices on Tesla's um and potential underwhelming margins. Uh you know, from Tesla's earnings, what areas Elliot could be impacted and provide some trading opportunities with the recent rally that we've seen in the US dollar. Yeah, the US dollar has been on a steady rise this year. It hit a year to eight high earlier this month. Um Gold miners and gold are, are really sensitive. The dollar, gold has been relatively flat this year. Um Generally stronger dollar drives the price of gold lower. Um We've seen a little uh you know, reversal from that um through our gold miners, ETF and some pickup and trading there. We have uh two X gold miners, ETF nugt and dust, which is our bull and bear product, um which we've seen traders looking as almost a flight to safety trade, partially coupled with most recently the conflict going on in the Middle East. Um And then on top of that, if you're looking to expand, you know, broader to more emerging market economies, stronger US. Dollar generally hurts emerging markets, em equities tend to have a negative correlation to the dollar and heavily reliant on foreign investments and debt repayments through the US dollar. So we do have um a triple leveraged uh MS C I emerging markets, ETF E DC and Edz. Um and we've seen an uptick in that throughout the year, especially recently with uh some of the activity within the dollar. All right, Elliott Wellen Bach, thank you so much for joining just after the market opened. And to find out more about how direction ETF enable you to see profit and manage risk in all market conditions. Visit www dot direction dot com for investing, do carefully consider a funds, investment, objective risks, charges and expenses contained in the prospectus at direction dot com. Read carefully.