Nov 15, 2017 - Market Update (Xi to visit NoKo one day, Mohammed El-Erian a new Fed vice-chair?, Stocks not comfortable with no new catalyst, GE story, Airbus – a new USD 40 bln order?, Volkswagen and police/tax authorities again, Loxo partnering with Bayer, US yield curve flattening despite 2-yr yield hitting a 9-yr high, EURUSD - forget about H&S, looking at 1.1900, USDJPY to dip below 112.00)

Short recap

Asia in red but BoJ active in ETF buying

Europe opening lower

Special envoy from China heading to NoKo on Nov 17

Central bankers talking about an end of easy money

Mohammed El-Erian a new Fed vice-chair?

Risk bubbles rising across EMs:

Military taking over in Zimbabwe, where is Mugabe?

Venezuela defaulting, South Africa to be downgraded

Equities

Stocks not comfortable with no new catalyst, GE story

And getting nervous about upcoming Fed tightening

Airbus – a new USD 40 bln order for 400 planes coming?

Volkswagen having issues with police and tax authorities

Loxo Oncology entering into collaboration with Bayer (USD 1.6 bln)

Biotech firms focusing on using bacteria in cancer research

Bombardier signing a USD 1.1 bln deal with EgyptAir

Earnings

Cisco – expecting decline in revenue from traditional products

Target

Bonds

10-yr Trys yield at 2.36%

2-yr Notes touched a 9-yr high but the yield curve keeps flattening

10-yr Bund yield at 0.39%

EURUSD

Huge H&S reversal is over after breaking 1.1700

Decisive break of 1.1615 (high from May 2016), 1.1649 (200 WMA), 1.1670 and descending trendline connecting the lows of Oct 2008, Jul 2012

Also broke 1.1736 (100 DMA) 1.1785 (50 DMA), 1.1810 (38.2% Fibo of 2014-2015 decline) and 1.1822 (50.0% Fibo)

Next resistance Oct highs and 1.1886 (61.8% Fibo)

 Source: Saxo Bank

USDJPY

Resistance at 113.65 (10 DMA), 113.00, 112.97 (23.6% Fibo),

Support at 112.47 (50 DMA)

Closing below 23.6% Fibo will expose 111.90 (38.2% Fibo), 111.76 (200 DMA) and 111.72 (100 DMA)

Data/events

EU General Affairs Council meeting

Fed’s Evans (0800 GMT)

ECB’s Praet (1000 GMT)

Fed’s Rosengren (2110 GMT)

Nov 28 – Powell before Senate Banking Committee

Dec 13 – FOMC

Dec 14 – ECB

Dec 14-15 – EU Summit talking Brexit

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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Oct 26, 2017 - Market Update (ECB day today but should they do anything?, Turkish CB in the spotlight too, EURUSD range 1.1660-1.1860/1.1900+, Airbus-Bombardier deal a China story?, Brazil yields up on elections risk, VIX to loo for too long - recall the Aug 2015 China blow...)

Short recap

Asia flat

Europe opening flat

China going for USD denominated bonds again (first issue from 2004)

ECB day today - lots of uncertainties around QE cut back (low inflation, strong EUR vs growing economy)

Still not clear whether ECB should do it today or not

A Turkish Central Bank announcement important today

As there are speculations about Germany (EU) to cut funding for Turkey

Equities

GaxoSmithKline likely to boost their consumer health business via acquisitions

Airbus deal with Bombardier might have had more to do

With technology and production shift to China than with Boeing

As some Chinese investors were looking at Bombardier as well

Earnings

Microsoft – expecting higher revenue on cloud business

Alphabet – expecting higher revenue on mobile, YouTube, Play Store and cloud

Intel – to benefit from stable PC market and very good growth from data centers

Amazon.com – retail and cloud should help while new markets and acquisitions weight

Ford – question is how the weak sales in Europe and Chine effect the results

Planning to cut USD 14 bln and focus more trucks and electric/hybrid cars

Newmont Mining – market is looking at higher revenue on more effective production of gold

Teck Resources – expecting a nice surprise on higher prices of coal, zinc and cooper

Bonds

10-yr Trys yield at 2.43%, above technical 2.40% level

10-yr Bund yield at 0.48%

Brazil – the yields highlight upcoming volatility before next year’s presidential elections

Stocks at records highs, BRL is stable but investors are getting nervous whether new president

Will keep up with reform process

VIX

What a nice ride for all of those who bet on falling risk

But…things may change, be aware of that

As the Chinese blow out from Aug 2015 shows

What about VIX spiking again 96% ?

Source: Saxo Bank

EURUSD

Easy hawkish surprise but difficult to sell the market dovish view

Draghi to have a hard time to talk down EUR based on ongoing price action despite higher US yields

Saw some short covering going to ECB & because of new question marks appeared around US tax reform

Markets expect dovish taper

See range of 1.1660-1.1860/1.1900+

Resistance at 1.1850 (50 DMA), 1.1862 (23.6% Fibo)

Support at 1.1793 (10 DMA), 1.1783 (200 HMA), 1.1750/60, 1.1720 (38.2% Fibo)

USDJPY

Selling interest above 114.00

Huge expiring options with strikes 113.50-80 and 114.50/115.00

Bids a 113.50, more towards 113.00 with stops below

Support at 112.99 (10 DMA)

Trading around descending trendline after getting close to recent high at 114.50 from July

Gold

Taylor or Powell ? Taylor can make a hit on gold

As he favours quicker rate hikes and return back to normal

Resistance at 1281 (50.0% Fibo), 1285 (10 DMA)

Support at 1275 (100 DMA)

Data/events

ECB (1145 & 1230 GMT)

Fed’s Kashkari (1430 GMT)

Fri

ECB’s Praet (0715 GMT)

Trump announcing a new Fed chair

Nov 1 – FOMC

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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July 28, 2017 - Market Update (Bad day for Trump - no Russia sanctions, no VAT, no BAT, no Obamacare repeal, EURUSD hitting strong multiyear resistance zone, USDJPY played by expiring options today, US GDP to surprise, NASDAQ down on rotation out of Techs, Apollo rising USD 25 bln)

Short recap

Asia lower on risk off

Europe opening

Mnuchin to support steps not tough talk against FX manipulators

As it hasn’t been working for years

Senate rejected new sanctions against Russia

Not even watered down Obamacare repeal bill can pass through Senate

Another huge blow to Trump after no VAT and BAT implementation

Those two got rejected due to the need to overhaul the whole tax system in US

Equities

NASDAQ down on rotation out of Techs

Amazon hit by cost jumping

UBS cautious despite good wealth management business

Credit Suisse – profit jumps

Apollo’s new private equity fund raised USD 25 bln for investments in North America and Western Europe

Airbus not happy with delays caused by Pratt & Whitney production

Cameco settled with IRS at a fraction of original claim but heavy fight with CRA is waiting

Any correction in stocks to be triggered by upcoming tapering? The stock markets were moving higher hand in hand with QEs all around the world. What’s next?

Few facts:

Had a nice bull market rolling over the years

Market multiples above historical levels

Equities vs fixed income yield differentials are low

M&A activity hitting high

Upcoming tapering

Extremely low volatility will not last

Trump administration not able to deliver

Earnings

Earnings season so far good on weaker USD

Merck, AbbVie – to be watched as competition is rising

Exxon Mobil, Chevron – market expecting a profit print

Bombardier – cash flow, CSeries deliveries and potential joint venture with Siemens to be questioned

Baker Hughes, Barclays, Goodyear, American Airlines

Bonds

10-yr Trys yield at 2.30% up from 2.28% yesterday

10-yr Bund yield at 0.53% down from 0.55% yesterday

EURUSD

Down from yesterday on USD buying

Underlying tone stays pro-EUR, US GDP in watch

Support of note 1.1623/21 (10 DMA/23.6% Fibo), 1.1615, then 1.1580

100/200 HMA may also see some buying

Resistance at 1.1750, 1. 1776 (high), 1.1794 (200 WMA), 1.1810 (38.2% Fibo)

USDJPY

Sitting on 111.00 with likely dip demand around 110.80

Option expiries at 110.80 (USD 1.2 bln), 111.00 (USD 1.4 bln)

Likely to stay within the sight of expiry levels unless US GDP moves the market heavily

Lots of bids at 110.00

Gold

Durable goods orders and higher USD put pressure on gold yesterday

Traders see Fed to announce taper in Sep

Resistance at 1261 (61.8% Fibo)

Support at 125 (50.0% Fibo)

10/50/100 DMAs converge to 1250 level

Data/events

US Q2 GDP +2.6% exp vs 1.4% previous

Some banks revised up expectations on the back of yesterday's much better Durable goods orders

Fed’s Kashkari (1720 GMT)

Aug 24-26 Jackson Hole

Sep 7 - ECB

Sep 19-20 FOMC 

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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June 19, 2017 - Market Update (Macron win a huge potential for France, Fed speakers, US groceries shaking up, extreme long specs in EUR - a fall to come?)

Short recap

Asia up

Europe opening higher

China-Iran to conduct join naval practice in the Gulf

Iran firing over Syria

Trump doesn’t like Cuban salsa

Macron doesn’t need a coalition partner for important economic reforms

France has a huge potential if he delivers

PBOC made a huge CNY 110 bln OMO liquidity injection

Stating the declining liquidity after banks bought gov bonds (official statement)

Japan reported a surprise huge trade deficit on energy imports while exports made a fast jump on cars/steel

Fed’s Kaplan – Fed should be very cautious and patient in rising rates

Lots of speakers this week, let’s see whether others share the same hawkish view as Yellen does (check Data calendar below)

Macron, Schauble and now GE’s Zypries would welcome UK’s U-turn in Brexit

Equities

US groceries shaking on Amazon buying Whole Foods and Aldi entering the market

Is it going to end up for Wall-Mart as for Tesco in UK?

Do you like car makers? Watch for those with more exposure to China

As US auto sales to decline further on expiring leases pushing prices of used cars lower

Petrobras looking as an opportunity as it cuts debt but is still valued below industry average

Fiat-Chrysler exiting Japan?

Airbus upgraded its A380 to boost the sales

Bonds

10-yr Trys yield at 2.16% - still holding close to recent lows but the break of 2.10% would be critical for USD

10-yr Bund yield at 0.28%

COT report as of last Tue (pre-FOMC/ECB):

EUR long specs at 79k vs 74k week before

Highest since 2007

But bear in mind that any extreme is reverted to the mean in some time

Are we going to expect the same long specs reduction as we had witnessed in 2011/2014 ?

EURUSD

Support at 1.1187 (23.6% Fibo) then 1.1120/30

Resistance 1.1284, 1.1295/1.1300

Breaking 1.1100 or 1.1300 would definitely see strong flows and follow through

USDJPY

Likely heavy going to 111.50

Resistance at 111.24 (50.0% Fibo), then 111.32 and 112.16 Ichimoku

100 DMA at 111.85

Support at 110.50 (61.8% Fibo) and 110.71(200 DMA)

Descending trendline around 111.00

DXY

USD consolidation on halt?

To watch the US 10-yr yields breaking 2.10% or not

Need better US data to push real yields higher, so risky assets keep rising and financial conditions tightening

Close to resistance at 97.62, then 97.85 (50.0% Fibo)

And descending trendline around 97.98

Support at 97.02 (10 DMA)

Gold

Still under pressure post-FOMC

Support at 100 DMA at 1248, 1245 (61.8% Fibo)

200 DMA at 1237 and 1234 (76.4% Fibo)

Resistance at 1255 (50.0%)

Data/Events

No relevant data today but to watch speakers:

Brexit talks starting today at 0900 GMT 

Barnier and Davis speaking at 1630 GMT

ECB’s Lautenschlager (0900 GMT)

Fed’s Dudley (1200 GMT)

ECB’s Nouy (1300 GMT)

ECB’s Weidmann (1500 GMT)

Fed’s Evans (2300 GMT)

Tue

Fed’s Fischer, Rosengren, Kaplan

Wed

Brexit - Queen’s speech 1030 GMT

Thursday

EU Summit

Fed’s Powell

Fri

Fed’s Bullard, Mester, Powell

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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May 23, 2017 - Market Update

Short recap

Europe opening higher

GBP volatile on Manchester bomb attack

Merkel’s comments about weak EUR were more preparation ahead of today’s visit of Trump

As well as preparation for Sep elections as Germans like strong EUR (DEM) while don’t mind to kick a bit ECB

Trump acting as a mediator Muslim states, Israel and Iran

Trump’s budget – to cut gov spending like healthcare and social programs (USD 3.6 trln over 10 yrs)

Trump still caught in Russian scandal

Russian cyber attacks via Android targeted banks

Equities

Boeing taking on Bombardier on experience from Airbus

Swiss watch makers facing declines in sales

Noble down 28%, halted, downgrade and facing bankruptcy

M&As hitting new highs between US and EU companies

Bonds

10-yr Trys yield at 2.23%

10-yr Bund yield at 0.37%

Greek debt relief not yet but likely going to July payment on IMF request

Would face German pre-election opposition

Greek 2-yr yield to 5.25% from around 9.50% in Feb

DXY staying very weak

EURUSD

Yesterday’s/overnight move higher likely coming from new demand and short covering, Merkel and more bullish view of EZ assets

Overall EURUSD is well overdone

Critical 1.1300 may attract speculators

But EURUSD may even check the levels like 1.1314 (76.4% Fibo of May 2016-Jan 2017 move)

USDJPY

Not much volatility overnight after initial JPY strength on Manchester attack

Bids seem sitting below 111.00

Offers may be about 111.35

55 DMA at 111.34 and 50% Fibo at 111.24 acting as resistance

Gold daily

Resitance 1286 (76.4% Fibo)

Support 1255 (61.8% Fibo)

Crude oil

OPEC/Non-OPEC meeting on Thursday

9-month cut extension already priced in

Trump’s proposal to sell half of strategic reserves (344 mln barrels)

What would add daily 100k barrels of new oil over the next 10 years

Upcoming

Last day of Eurogroup meeting

Fed’s Kashkari speaking (1300 GMT)

Hammond, Schauble, Guindos speaking (1430 GMT)

ECB’ Coeure speaking (1500 GMT)

Fed’s Harker speaking (2100 GMT)

Wed – FOMC Minutes

Thu – OPEC/Non-OPEC meeting

Fri – G7 meeting

May 31 – former FBI director James Comey to testify before Senate (rescheduled)

June 8 – ECB meeting

June 8 – UK elections

June 11/18 – French Legislative (Parliamentary) elections (a big question mark for Macron to gain majority)

June 13/14 – FOMC meeting

Should you have any questions feel free to contact me anytime.

Good luck Champs!

Mr Hawk

DISCLAIMER: This material was created for informational purposes only and represents the Land of Trading team’s view of the past and current economic and capital market environment. It is not an investment advice and should not be viewed that way at all, and the creators of this material cannot be held liable for any potential losses resulting from trading, where despite this disclaimer someone would consider this material as an investment advice. All rights reserved ©2016. Contact: landoftradingATgmailDOTcom

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