Feb 6, 2018 - Market Update (No recession short-term, healthy correction done, no global contagion, so let's hunt for bargains; One Fed hike is priced off; Watch today for Trys yields, JPY crosses, VIX; New turning points for VIX at 22 & 30; XIV a problem for Credit Suisse; BNSF Railway (part of Berkshire) joining Blockchain in Transport Alliance; Hedging by book: long gold, JPY, 10- and 30-yr Trys; The panic is over, moving to the last leg up of 2009 bull run;German coalition talks well covered blockchain)

Short recap

Asia in red

Europe opening lower

US Congress to vote on government funding

German coalition talks well covered blockchain technology to make Germany a fintech hub

Draghi not ok with EUR volatility due to potential inflation miss

Kuroda – no near-term hikes

Question – what now?

Honestly, I am not sure either…

…as Janet is celebrating and Powell not being able to find the “Buy” button

Market is down and Trump focussing on long term fundamentals and not the short term sell off

It reminds me local CEE politicians who cheer and show up in the public only in good times

Let’s sum up a bit

S&P 500 was 12% above 200 DMA – markets do not stay very long 10% above 200 DMA

(for regular bull market it is between 5-10%)

Technicals showed way-overbought markets

Most of the market followed the same direction (robots, ETFs, investors selling volatility) for months/years

Selling volatility/insurance and now covering positions

But after market dropping more than 6% all start to hedge (thus more selling)

S&P 500 found support at 2538 (200 DMA) after touching low of 2530

DAX didn’t care about 200 DMA and found support around 2015 highs, 2017 support levels

And below 12 275 (76.4% Fibo) after printing 12 141 low

VIX skyrocketed above 33 (up 113% on a day) but corrected (25+ levels signal market fear)

XIV (short volatility ETF) plunged (speculation that Credit Suisse lost USD 500 mln)

Let’ wait for official comments

Hedging based on history

Long Gold – pretty unmoved (sitting right below resistance zone (1357-1375)

Long JPY – sitting right lows of 108.12/107.31 acting as support but not very affected

Long 10- and 30-yr Trys – enjoyed very decent rally yesterday

Why to hedge?

CBs believe in rising rates globally on inflation pressures and strong growth

But China is slowing down and coping with huge credit problems

US economy topped, EU to follow soon and as Japan population is old, the lag

Example from 2011 – losses prior week, losses on Monday, more at the open on Tuesday

And recovery taking more than half a year…

What to do next?

As there is no recession risk near term, the healthy correction & late stage bull market panic is done

Stock markets will hopefully find their calm soon

So we can focus on hunting as a part of final leg up of the bull market that started back in 2009

…but be aware of:

FX, EM unaffected (EM equities down only 5%) – a positive sign

One Fed hike is priced off; If volatility continues another one can get priced off

No global contagion – a positive sign  

Watch today for Trys yields, JPY crosses, VIX (can fly in both directions with turning points at 22 or 33)

JPY 1m ATM vols (jumped from 6% to 10%)

Equities

Broadcom bidding for Qualcomm (USD 121 bln)

Bayer to sell more assets (seeds/pesticides) to please EU as it buys Monsanto

Elliot Advisors don’t like BHP’s dual listing (among other things)

Energy stocks still worth of looking at (also multiplied by recent sell off)

Boeing keen on a new mid-market jet

Bristol-Myers still behind Merck with cancer drugs testing data

Apple and Cisco come together to work with insurance companies on cyber policy products

Banks moving away from models to stock picking on new research rules

BNSF Railway (part of Berkshire) joining Blockchain in Transport Alliance

Earnings

Allergan, GM, Gilead Sciences, Walt Disney

S&P 500 daily

DAX daily

Source: Saxo Bank

Bonds

10-yr Trys yield at 2.65% vs 2.86% yesterday

Yield at 3.00% a buying opportunity?

10-yr Bund yield at 0.73% vs 0.76% yesterday

Bitcoin

Bitcoin's Brutal Week Is Even Worse in South Korea  link

So-called kimchi premium disappears amid government clampdown

Bitcoin prices globally are sliding to their lows of the year

Data/events

ECB’s Weidmann (0900 GMT)

Fed’s Bullard (1350 GMT)

Feb 16 – Chinese New Year

Mar 4 – Elections in Italy

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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Jan 18, 2018 - Market Update (Apple with USD 38 bln tax bill, bringing home USD 250 bln; Renault-Nissan a king over Volkswagen; Goldman Sachs dropping bond trading?; GE still on short side; Junk bonds spreads at record lows, China/Japan getting rid of Trys - nothing new; USDRUB floor between 55.70-56.00; Brent having hard time to stay above USD 70 mark; Biggest Bitcoin mines in China)

Short recap

Asia hitting record levels

Europe opening higher on bullish sentiment from US and Asia 

China growing too fast with respect to economic and pollution standards

Trump fighting back China with intellectual property breaches (likely getting ready for Davos)

Loud calls for EZ reform with new fiscal rules (GE) and joint safe assets (FR)

Equities

Cyber security start-ups having hard time

As very crowded market is moving fast and facing criminal predators, competition is a tough job

Volkswagen produced 10.7 mln cars last year

But the crown goes to alliance of Renault-Nissan though

Peugeot looking to come back to US market using know-how of Opel

Chinese interested in diabetes business from Johnson&Johnson (USD 3-4 bln)

Apple planning to open 2^nd Campus in US that is a part of 5-yr USD 30 bln investment package

And also repatriate USD 250 bln of overseas cash, thus paying USD 38 bln of taxes

Looking to create 20k jobs in US, focussing on data centers for iCloud, AppStore and Apple Music

Earnings

Goldman Sachs hit by a drop in bond trading

What makes question marks about keeping bond trading in current form

Or searching for new profit generating activities

Adjusted profit beat expectations but company is having harder time in trading than rivals

GE shares keep declining on USD 11 bln of charges and likelihood of a breakup

…already touched the GE story: Nov 15, 2017 – Story of the Week: Comparing old and new economy…General Electric and Tesla  link

Morgan Stanley, Bank of New York Mellon, IBM, AMEX reporting

New US corporate tax cut should help earnings to be revised higher

Bonds

10-yr Trys yield at 2.59% vs 2.56% yesterday

10-yr Bund yield at 0.57% vs 0.55% yesterday

Not only China but also Japan is lowering their Trys holdings  link

Back in 2004/05 both China and Japan held 50% of all Trys held by foreigners

And now they do 36% only

Junk bonds - The Great Credit Dilemma: When to Quit After Historic Rally?  link

Corporate bonds too expensive to own, but too valuable to sell

Schroder, Aberdeen fund managers plot exit strategies

USDRUB

Rising oil makes Russian officials not comfortable with strong RUB

As we saw back in 2017, they are quite good at defending certain levels

Support at 56.20 and 55.72 (Apr 2017 low)

Resistance at 56.73 (10 DMA), 56.76 (Sep/Oct 2017 lows), 57.20 (23.6% Fibo)

USDRUB weekly

Source: Saxo Bank

Crude Oil

Supported by decline in private inventories in US

And attacks from rebels in Nigeria

EIA inventories and OPEC Monthly report out today

With speculations about another decline in oil stocks and substantial rise of shale production

Brent having difficulties to stay above USD 70 level

Support 69.06 (10 DMA), 68.19 (23.6% Fibo), 66.84 (38.2% Fibo), 64.91 (50 DMA)

To watch the 66.84 key level

Source: Saxo Bank

WTI

Support 63.15 (10 DMA), 62.75 (23.6% Fibo), 61.43 (38.2% Fibo), 58.77 (50 DMA)

Source: Saxo Bank

Bitcoin miners locations

…or where is the cheap electricity and smart people are…

Data/events

ECB’s Weidmann (0800 GMT)

ECB’s Coeure (1430 GMT)

ECB’s Villeroy (1730 GMT)

Fed’ Mester (2305 GMT)

IMF’s Lagarde to speak today as well

Jan 19 – US fiscal deadline

Jan 23-26 – Trump in Davos with his crew

Will be interesting to see Macron/Merkel and the world

Against protectionism of Trump/US

Jan 23 – BoJ – any hints on potential taper?

Jan 25 - ECB

Jan 30 – US State of the Union

Trump to announce an infrastructure plan but is not clear who would build the infrastructure

Because of his anti-immigration policies

Jan 31 – FOMC

Feb 5 – Powell as Fed Chair

Feb 16 – Chinese New Year

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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Dec 5, 2017 - Market Update (Brexit and US tax bill market movers, EU to review US tax bill and its implications, S&P 500 & DAX - what's next?, Apple to start to paying back taxes to Ireland in Q1 2018 (EUR 13 bln), Toll Brothers facing lack of skilled labour - an issue for home builders across US)

Short recap

Asia took a break

Europe opening flat to slightly up

US tax bill refining continues as the bill moves from Senate to the House before it lands on Trump’s table

Many have changed the wording from tax reform bill to tax bill

AMT getting challenged as many companies may loose the tax break and pay the 20% alternative minimum tax

EU to assess US tax bill and its global tax implications

Brexit still not moving to phase 2 as getting stopped at Northern Irish border

CBOE launching Bitcoin futures on Dec 10 while CME on Dec 18

Equities

US stocks saw another day of out of Techs rotation

But market was overall down on a small positive long term impact of tax reform

Sanofi having hard time in Philippines

Thyssenkrupp-Tata Steel merger facing unions

Dialog Semiconductor not happy with Apple developing its own battery saving chips

Apple to start to paying back taxes to Ireland in Q1 2018 (EUR 13 bln)

Toll Brothers to report better results on the back of strong job market but facing lack of skilled labour

That may not be the best thing for luxury home builder

S&P 500 daily – a correction back to 2475 level means down 7.1%

Source: Saxo Bank

DAX daily – range bound with 13 047 (100 DMA) support 

Source: Saxo Bank

Bonds

10-yr Trys yield at 2.39%

10-yr Bund yield at 0.33%

EURUSD

US yields keep showing direction for USD

As USD bulls may get frustrated with inability to decisively break 2.40% yield in 10-yr Trys

Resistance 1.1870 (10 DMA), 1.1886 (61.8%), breaking 1.1961 high would be seen as a new direction setter

Support 1.1822 (50.0% Fibo), 1.1810 (38.2% Fibo of 2014/15 decline), 1.1794 (100 DMA), 1.1758 (50 DMA)

Source: Saxo Bank

USDJPY

Not able to break above 113.00 level

Resistance at 112.82 (50 DMA), 112.97 (23.6% Fibo)

Support 111.89 (38.2% Fibo), 111.68 (200 DMA), 111.57 (100 DMA)

Source: Saxo Bank

Gold

Resistance 1281 (50.0% Fibo), 1281-86 (50/100 DMA)

Support from rising trendline holds, then 1267 (200 DMA) and 1263 (61.8% Fibo)

Data/events

EU FinMin meeting

ECB’s Constancio

US Senate banking committee votes on next Fed chair Powell

Dec 13 – FOMC

Dec 14 – ECB

Dec 14-15 – EU Summit talking Brexit

Dec 21 – BoJ

Dec 21 – Catalonia elections

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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Nov 20, 2017 - Market Update (No Jamaica in Germany, Leadership in EU on pause, Risk taking at record levels, Mugabe still in but already out, Norwegians not counting on oil/gas, EURUSD to keep hawkish tone above 1.1675-1700 zone, Gold to test medium-term resistance at 1306)

Short recap

Asia in red

Europe opening lower

No Jamaica coalition in Germany – Merkel can still form a minority government

No history of minority government or new election creating more uncertainty

Merkel to meet president, German leadership in EU on pause

What worked in difficult 2000s and 2010s years not working anymore

Pragmatism, conservativism and stability to be replaced

Zimbabwe’s Mugabe not willing to resign yesterday

But a new deal is on the table with full immunity

Goldman Sachs sees Fed hiking 4 times in 2018

Lloyd Blankefein was heard that many would like to have confirming Brexit vote

Excessive risk taking at record level

‘Irrational Exuberance’ May Rule the Roost in Stock Markets  link

BAML fund-manager survey shows risk taking at all-time high

Investors see stocks as overvalued but bullish on growth

Equities

Volkswagen taking it seriously and investing EUR 23 bln in development

Apple not on time with smart speaker HomePod for Christmas

Tesla short of cash soon to ask for new money

To keep financing trucks, roadster and acceleration of production

Norway sovereign wealth fund to remove oil and gas companies

From its benchmark and cut their holdings

S&P 500

Resistance 2581 (10 DMA), 2589, 2597-2600

Support 2554 (23.6% Fibo), 2549, 2544

Bonds

10-yr Trys yield at 2.33%

10-yr Bund yield at 0.36%

EURUSD

Support area 1.1675-1700, 1.1710 (200 HMA),1.1714 (high from Aug 2015), 1.1747 (100 DMA)

Resistance 1.1759 (38.2% Fibo), 1.1771 (50 DMA), 1.1778 (55 HMA), 1.1810 (38.2% Fibo of 2014-2015 decline) and 1.1822 (50.0% Fibo)

Source: Saxo Bank

Gold

US tax reform, Germany and USD in play

Top range 1306 level needs to be taken off decisively

In order to break medium-term resistance

Resistance 1299 (38.2% Fibo), 1306

Support 1287 (50 DMA), 1281 (50.0% Fibo), 1280 (100 DMA)

Source: Saxo Bank

Data/events

ECB’s Nowotny (1145 GMT)

ECB’s Lautenschlaeger (1215 GMT)

ECB’s Draghi (1400 GMT)

ECB’s Constancio (1415 GMT)

ECB’s Draghi (1600 GMT)

EU Council meeting

CEE bankers conference

Wed

ECB Governing Council (no interest rate announcement)

FOMC Minutes

Thu

ECB Minutes

US Thanksgiving – markets closed

Fri

US bond trading close, stocks open halfday

Nov 28 – Powell before Senate Banking Committee

Nov 30 – OPEC meeting

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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Nov 8, 2017 - Market Update (EURUSD - H&S almost done, US yields not supporting further USD strength - a correction coming?, Oil - China demand lower on pollution cuts, Gold stuck in 1263-1282 range, ECB Governing Council meeting - watch the comments as more hawks on the Board, Apple - EU asked for more details about tax structure, Bitcoin an asset class?)

Short recap

Asia up

Europe opening lower

Trump in China to ask for China cutting financial ties with NoKo

US-Chinese companies signed USD 9 bln deals

USD impacted by headwinds/slowdown related to tax reform (implementation in 2019)

As the tax cuts will spike the budget deficit and will have only temporary effect on the economy (according to Fitch)

Brexit - EU preparing tough transition terms for UK (duration, scope and obligations)

According to CME Bitcoin is a new asset class, not crypto currency

ECB caught by bad loans in Italian banks

More leaning towards hawkish side what may support EUR

Equities

Apple – EU asked for details about tax structure

Monte dei Paschi in profit after some one off items (Q3)

Qualcomm-Broadcom merger under Chinese scrutiny

Valeant profits up

Funo (BoJ) – Japan stock prices not overheating, reflect global investments and corporate earnings

Nikkei 225 close to level last seen in 1992 on relatively low valuations, profit growth and weak JPY

Are US stocks too high?

As mentioned few days ago, the sentiment index (bulls/bears ratio) is close to 1987 highs what may be seen as bears completely giving up. Would feel like there are no more bears left to be converted to bulls and push the market higher. What’s next?

Yes, the valuations (S&P 500 with 19x forward PE) are high but we need a trigger. Is it going to be a weakness in US economy or substantial increase in rates? We believe that missing higher yielding alternatives than dividends are behind all low volatility and investors not caring. Of course US companies do well from earnings and revenue perspective but we truly lack an alternative. Even thought Fed is on a hike path, the bond yield remains flat, thus not attractive enough to trigger a cyclical rotation of capital.

Techs (lately Apple) do support the rally heading towards Christmas. A small correction or hesitation may come on the back of Trump tax reform hurdles. US macro is good, EBITDA at higher than in 2007, revenues growing almost 11% y/y as weaker USD gave a hand.

S&P 500 - we see a divergence on a daily chart, moving higher in a narrow channel and any decisive break up/down can start the correction.

Volatility is at extreme lows again prompting a China story from Aug 2015 to our minds. If you feel so, check this out…

 Warren Buffett’s favorite market metric suggests investors are ‘playing with fire’  link

 …and you may get some chips off the table now.

Bonds

10-yr Trys yield at 2.31% - very low, not lending any support to USD vs EUR, JPY

10-yr Bund yield at 0.33%

Periphery saw rally yesterday with Bunds almost unchanged

IT/PT to Bunds spread keeps declining

EURUSD

USD on negative, not helped by low US rates

As the yields remain low, USD need positive news from data or tax reform effort

Otherwise the recent USD rally is due for correction

H&S formation almost complete, Bear sitting above 1.1600 level

Resistance at 1.1595 (55 HMA), 1.1605 (50.0% Fibo), 1.1615 (high from May 2016), 1.1623 (10 DMA), 1.1658 (200 WMA), 1.1670 and descending trendline connecting the lows of Oct 2008, Jul 2012

Support at 1.1550, 1.1500, 1.1490 (61.8% Fibo)

USDJPY

Heavy activity expected above 114.00

As there are bids from lows and above 114.00

Nikkei 225 to test 23 000 level

Goldman Sachs looking to invest in Japan

Resistance at 114.40/50

Support at 113.82 (10 DMA)

Source: Saxo Bank

Oil

Crack on corruption and fight for power a new daily norm in Saudis

Speculative demand for front end contracts (backwardation) drives oil higher

While sellers sitting on sidelines and supply unaffected

Be aware that this speculative longs may create a misleading feeling about market tightening

Geo political risks to support oil further along with likely OPEC cuts extension

Overnight corrected on lower China imports as country is reducing production due to pollution over winter months

EVs can create a plateau in 2030

Gold

Stuck between 1263 (61.8% Fibo) and 1282 (50.0% Fibo)

Sitting above 1277 (100 DMA) with further level of note 1300/1306

Which may be in focus once 1282 is broken and net sellers turn to buyers

Data/events

ECB Governing Council meeting

To watch any comment as more officials lean to hawkish side

Are US rates dependent on the height of the Chair? Enjoy...  link

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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Nov 2, 2017 - Market Update (FOMC a non event, Powell in and Tax bill out, BoE hiking after 10 years & taking a long break after..., EURUSD a shadow of USDCNH, IMF not ok with selling volatility products, Apple a big thing after market, Barclays fed up with Brexit and taking actions, Deutsche Bank seeking a second building in Frankfurt)

Short recap

Asia printing new 10-yr high as on optimism from Fed

Europe opening lower

FOMC – no changes, non event

Just reconfirmed all with economic activity to solid from moderate

Dec hike a done deal

IMF warns volatility products loom as next big market shock  link

Selling volatility complex products can be the trigger if volatility suddenly increases

Equities

Barclays is fed up with how UK is handling Brexit

And implementing their own plan

Deutsche Bank to move more operations to Frankfurt

Herbalife off the Ackman’s short bet who turned to options instead

Signa Holding (owner of Karstadt) eying Kaufhof (owned by Hudson Bay) for USD 3.5 bln

Thanksgiving travels to help airliners

Novo Nordisk warning of US legislation (Trump’s anti industry rhetoric)

Earnings

Apple – should learn more about Christmas iPhone sales and iPhone X orders

Asia is impressed by iPhone X but are they going to actually buy/afford it?

Others reporting: Alibaba, Starbucks, AIG, DowDuPont, Cigna, BCE, Bombardier

Bonds

10-yr Trys yield at 2.36% below 2.40% as attempts to get above faded

10-yr Bund yield at 0.38%

EZ yield spreads contracting, namely IT to GE, ES to GE going to year end

EURUSD

Resistance at 1.1640 (hourly Ichimoku), 1.1670 (200 WMA), 1.1690 (10 DMA), 1.1695 (100 DMA), 1.1720 (38.2% Fibo)

Support at 1.1630 (hourly Ichimoku), 1.1615 (high from May 2016), 1.1605 (50.0% Fibo), 1.1500

 Source: Saxo Bank

Is USDCNH telling Us something ? EURUSD bulls need to move above 1.1660 in order the daily H&S to be under pressure…

GBPUSD

BoE hiking after 10 years? One off to 0.50% from current 0.25%

And likely taking a long break after…

Hard to spot any levels of choice and Brexit mess is still ongoing

Support at 1.3222 (50 DMA), 1.3204 (10 DMA)

Resistance at 1.3336

 Source: Saxo Bank

Gold

Got some support from Powell nomination

No clear reaction to FOMC’s no change, just a small advance as rate don’t go up immediately

Resistance at 1281 (50.0% Fibo), descending trendline

Support at 1275 (10/100 DMA), 1263 (low & 61.8% Fibo)

 Source: Saxo Bank

Data/events

Fed’s Powell (1230 GMT)

Fed’s Dudley (1620 GMT)

Republicans unveiling tax reform bill (1515 GMT)

Rumours on repatriation tax rate:

5% on non-cash

12% on cash

But no offsetting revenue yet

Possibility of a temporary nature of the tax cuts

Trump meeting House GOP leaders (1745 GMT)

Trump announcing a new Fed chair (1900 GMT)

Powell likely taking the Chair and Taylor his Deputy?

That would be a true shift after Yellen…

Powell good for stocks as we can see the continuity

But not much for USD

Fed’s Bostic (2215 GMT)

Fri

US NFPs

Payrolls +310k exp. vs -33k prior

Unemployment rate 4.2% exp. vs 4.2% prior

Hourly earnings 0.2% exp. vs 0.5% prior

Fed’s Kashkari (1615 GMT)

ECB’s Coeure (2015 GMT)

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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Sep 22, 2017 - Market Update (China downgrade on still fast credit growth, NoKo a new H-bomb test while Kim is in NY, Stronger EUR weighting on DAX, Apple under pressure - a new target at 142?, May's perfect time of Brexit speech at 1900 GMT, Germany voting on Sunday, Gold at 1295 - which way?)

Short recap

Asia in red on NoKo and S&P downgrade of China (outlook stable) and Hong Kong (outlook negative). S&P not comfortable with Chinese still strong credit growth

Europe opening lower

Speculation that NoKo will test powerful hydrogen bomb in Pacific

PBOC asked Chinese banks to stop cooperating with NoKo

Equities

Lufthansa to absorb largest part of AirBerlin’s assets

While easyJet should get some too

Stronger EUR weighting on DAX

12 500 to be tested again

B&N Bank carrying a USD 6 bln hole on its balance sheet

Apple still under the pressure as investors question the new product range

If not comfortable, can eventually test 142 level (200 DMA)

Support at 153 (50.0% Fibo/100 DMA), 150 (61.8% Fibo)

Resistance at 156 (38.2% Fibo), 157 (50 DMA), 159 (23.6% Fibo)

Source: Saxo Bank

Bonds

10-yr Trys yield at 2.25% vs 2.27% yesterday

10-yr Bund yield at 0.46% vs 0.45% yesterday

DXY

Heavy on USDJPY decline

Still not able to detach from current congestion zone

After FOMC pullback much stronger then in EURUSD

Why not following through and moving higher?

Source: Saxo Bank

EURUSD

If decisive move above 1.2000, we may see more gains

Strong support zone 1.1870/80

Support provided also from rising trendline (since April) and 1.1862 (23.6% Fibo)

Next levels 1.1819 (50 DMA), 1.1727 (200 WMA), 1.1720 (38.2% Fibo)

Resistance at 1.1941 (10 DMA), 1.1945 (55 HMA)

Large options expiring at 1.1925 (EUR 1 bln), 1.1950-75 (EUR 1.9 bln), 1.2000 (EUR 1.4 bln)

With more above 1.2000 level that can play in

Is the 1.2500 a target before correcting below parity like in 1998?

USDJPY

Resistance at 112.18 (200 DMA), 112.71

Offers starting at 112.50 on

Expiring option (USD 1.7 bln) at 112.00 may attract the cross

Support at 111.60 Ichimoku, 111.43 (23.6% Fibo), descending trendline

Gold

Support at 1295, 1281 (50.0% Fibo)

Resistance 1299 (38.2% Fibo), 1300, ascending trendline

All critical levels for further medium term direction

Bullish while above daily demand...

Data/events

ECB’s Coeure (0715 GMT)

ECB’s Draghi (0800 & 0930 GMT)

Fed’s Williams (1000 GMT)

ECB’s Constancio (1115 & 1315 GMT)

Fed’s George (1330 GMT)

Fed’s Kaplan (1730 GMT)

Brexit – a major speech from May (1900 GMT)

Is UK sort of reshuffling priorities or looking to reset the talks?

Rumours UK ready to pay EUR 20 bln a year for market access

EU’s Barnier to respond shortly after May’s speech

Sunday – German elections

How strong the grand coalition will be?

Sep 26 Yellen speaking about inflation and monetary policy

Oct 18 – China National Congress

Oct 22 – Japanese elections

Oct 26 ECB

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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Sep 21, 2017 - Market Update (FOMC - market not a strong believer of Fed talk, EURUSD sitting at strong support 1.1870/80, Gold at crossroad between 1290-1300, UniCredit to buy Commerzbank, Apple slowing, Huawei, Oppo, Samsung speeding up, EU to redo taxation of digital world)

Short recap

Asia in red

Europe opening higher

EU-CA free trade deal in effect starting today

EU to redo taxes on digital companies

Goldman Sachs expect USD 1 trln tax cuts (0.4% of GDP) over 10 yrs

FOMC – no change, rates 1.00-1.25%

Taper starting in Oct to get cushion for next crisis

Expecting 1 more hike this year, 3 hikes next year

Market pricing Dec hike at 66% vs pre-FOMC 46%

But market still not a strong believer in Dec hike yet

Fischer out, Yellen likely out next year want to make a point

Low inflation transitory but with question mark

BoJ – no policy change

Short term rates target at -0.1%

10-yr JGB yield target at 0%

Bond buying at JPY 80 trln annually

Who holds the most assets?

Fed 23% of GDP – on the way to trim

ECB 40% of GDP – Draghi was late to the QE party but did well

BoJ 60% of GDP – no signs of slowing…

Equities

Delphi & BlackBerry to work on self-driving cars software

Google eying HTC Corp (USD 1.1 bln)

UniCredit interested in merging with Commerzbank

New Apple watch experiencing connectivity issue

Apple slowing in innovation while Chinese rivals (Huawei & Oppo) growing on design and price

Amazon screening website for ingredients used to make bombs

Something different... Amazon is the New Tech Crash  link

Bonds

10-yr Trys yield at 2.27%

10-yr Bund yield at 0.45%

EURUSD

Completed bearish outside day

Sitting slightly above the strong support zone 1.1870/80

Post-FOMC flows to show direction today

Support provided also from rising trendline (since April) and 1.1862 (23.6% Fibo)

Then 1.1837, 1.1823, 1.1808 (50 DMA), 1.1727 (200 WMA), 1.1720 (38.2% Fibo)

If we see a consolidation 1.1600/1.1500 may be a target

Resistance at 1.1943 (10 DMA), 1.1966 (55 HMA)

USDJPY

Fed moving, BoJ on hold makes bearish tone for JPY

Resistance around 112.60-70, stops above up to 113.00

Then 113.14 (23.6% Fibo)

Support found from 112.20 lower with bids starting at this level

112.31 (38.2% Fibo), 112.18 (200 DMA), descending trendline

Gold

USD and higher yields putting pressure

Rocket man and Barking dog providing support

Support at 1281 (50.0% Fibo)

Resistance 1299 (38.2% Fibo), 1300, ascending trendline

All critical levels

Data/events

ECB General Council meeting

ECB’s Praet (0930 GMT)

ECB’s Draghi (1330 GMT)

Sep 21 – Brexit – a major speech from May expected

Is UK sort of reshuffling priorities or looking at a reset of talks?

Oct 18 – China National Congress

Oct 26 ECB

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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