Oct 20, 2017 - Market Update (US Senate moving on budget, US jobless claims hitting multidecade low - positive on spending/GDP/inflation/USD, Catalonian bank run, S&P 500 tested the support around 2544/40, Earnings to set the tone for today's trading, Schlumberger results important for correction in energy stocks)

Short recap

Asia up after some hesitation at the beginning

Europe opening higher

US Senate moving on 2018 budget, next step towards tax reform

US jobless claims hitting multidecade low what means more people working, more money for spending

As consumption is 60% of US GDP, we can see in the future higher GDP growth pressuring up inflation

Merkel positive on Brexit progress but not at the stage to move to trade talks

Catalonian separatists supporting bank run what may send shockwaves across equity markets in Europe

BoJ’s Kuroda – to continue with powerful QE

Equities

Stocks had a test day yesterday on Catalan risk, speculations about high valuations and weaker earnings

Bias still negative today – a correction before weekend coming? Well, depends on earnings now…

S&P 500 tested the support (now around 2544/40) with resistance between 2573/75

But US Senate move with 2018 budget to reflect positive in today’s session

Apple hit by weak demand for iPhone 8

Greek banks Piraeus, National and Alpha looking to sell EUR 5.5 bln of bad loans

Nestle beefing up restructuring cost

Earnings

Weak in Europe – a strong EUR an issue or what?

Not stellar in US with slow revenue growth – are investors going to punish companies with sell off?

On the other hand low bond vs dividend yields still supportive for equities

Today: Daimler (disappointed), GE, Schlumberger, P&G, Honeywell

Energy market will focus on Schlumberger as any disappointment in outlook

Can translate into energy stocks correction that is already sitting on support

Little bit of perspective of Black Friday sell off in Oct 1987:

Few words as well…  link

  

…and back to today’s reality:

If all market participants are buying, there is no bear that can get converted to bull

If it is the case, there are no other buyers left…

  

But still some thoughts from Warren Buffett – video (49 min)

Bonds

10-yr Trys yield at 2.36%

10-yr Bund yield at 0.39%

EURUSD - ready to correct big time and trading below parity? Next week's ECB holds the key as the 2yr Trys-Bunds spread is at extreme  link

  

DXY

200 WMA at 93.05 critical

EURUSD

Expiring options at 1.1800 (EUR 1.5 bln), then 1.850-55 (EUR 1.4 bln)

Likely to range 1.1800/50 today unless we get a surprise…

Resistance at 1.1847 (50 DMA), 1.1862 (23.6% Fibo), 1.1880, 1.1910

Support at 1.1800/10 (200 HMA), 1.1787 (Ichimoku), 1.1750, 1.1720 (38.2% Fibo)

Source: Saxo Bank

USDJPY

Supported by higher yields on US budget news

Resistance at 113.43 with stops sitting above 113.50

To test 114.00, then 114.50 but stops above both levels

Exporters can be seen above 113.50

Support at 112.48 (10 DMA)

 Source: Saxo Bank

Gold

Resistance at 1289 (10 DMA)

Support at 1281 (50.0% Fibo), 1276 (100 DMA)

Source: Saxo Bank 

Data/events

China National Congress (Fri/Sat)

EU Summit (Fri/Sat)

Czech parliamentary elections (Fri/Sat)

BoJ’s Kuroda (0635 GMT)

Fed’s Mester (1800 GMT)

Fed’s Yellen (2330 GMT)

Oct 22 – Japanese elections

Oct 26 – ECB

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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Oct 16, 2017 - Market Update (May urgently in Brussels ahead of EU Summit, Austrian elections outcome a non event as no exit EU talk, ECB's QE limit at 2.5 trln?, Aramco's private shares sale instead of IPO, Volkswagen short of cobalt supplies, Tech to benefit from corporate spending but position adjustments imminent, USDJPY weekly - not great for bulls but DXY holding above lows may give a hand)

Short recap

Asia up
Europe opening higher

Governor of PBOC Zhou bullish on Chinese economy ahead of Congress

Austria turning populist to far right but no exit EU talk

To challenge Macron’s view of more Europe, tough on immigration…etc.

Catalonia ready for talks with Spain but no mentioning of declaration of independence

Iraqi military in control of Kurdish oil fields

ECB’s QE limited at EUR 2.5 trln ?  link

Fed’s Yellen monitoring inflation, economy strong, gradual hikes appropriate

Fed’s Rosengren ok with Dec hike and 3-4 more hikes next year

BoJ’s Kuroda – markets overlooking the geopolitical risks

May taking it seriously and making unannounced trip to Brussels to meet with Barnier and Juncker today  ahead of EU Summit Oct 19-20  link

Equities

Atlantia increasing offer for Abertis to EUR 17.8 bln to stretch muscles over ACS’s offer

SWIFT holding an annual meeting with focus on cyber security

Aramco may go for a private share sale instead of IPO

With sovereign wealth funds and institutional investors taking advantage

Volkswagen having issues to secure stable cobalt supply in a long run

What is another sign of strong competition in electric vehicles field

Glencore, China Molybdenum, Vale are largest producers of cobalt

Earnings

Tech companies to benefit from higher corporate spending

But are a bit overstretched after rally from Sep

May see some position adjusting ahead of next week releases

Mon – Netflix

Tue – MS, GS, IBM, J&J

Wed – American Express, Atlas Copco, eBay, P&G

Thu – Unilever, SAP

Fri – GE, Daimler

Bonds

10-yr Trys yield at 2.29%

10-yr Bund yield at 0.40%

COT report as of last Tue

Specs decreased bearish USD positions

EUR longs at 98k vs 91k previous week

JPY shorts at 101k vs 85k previous week

GBP longs at 15k vs 20k previous week

EURUSD

Dovish Draghi, hawkish Yellen, Merkel’s party loss pushed cross lower at the open

Traders noted stops below 1.1790 with bids sitting around 1.1755/65

Resistance at 1.1845 (50 DMA)1.1862 (23.6% Fibo), 1.1880 (break can open short term higher), 1.1910

Support at 1.1783 (200 HMA), 1.1780 (10 DMA), 1.1750, 1.1720 (38.2% Fibo)

USDJPY

Keeps heavy after US CPI miss on Fri

112.00 kept by expiring options

Bids sitting at 111.50 while offers above 112.10

Resistance at 111.85 (23.6% Fibo), 111.83 (200 WMA), 112.15 (50 WMA)

Support at 111.78 (200 DMA)

Weekly chart - not great from bulls perspective

but DXY is telling a different story as long as last week low holds

Data/events

EU Foreign Affairs Council

UK’s May, Davis meeting EU’s Juncker, Barnier

ECB’s Angeloni (1300 GMT)

ECB’s Lautenschlaeger (1800 GMT)

Tue

ECB’s Constancio (0800 GMT)

ECB’s Praet (0930 MT)

Fed’s Harker (1700 GMT)

Wed

ECB’s Draghi (0810 GMT)

ECB’s Praet (1145 GMT)

Fed’s Duddley (1200 GMT)

Fed’s Kaplan (1200 GMT)

ECB’s Coeure (1415 GMT)

Fed’s Hirtle

Fed’s Fischer

Thu

Fed’s George (1330 GMT)

Fri

BoJ’s Kuroda (0635 GMT)

Fed’s Mester (1800 GMT)

Fed’s Yellen (2330 GMT)

Oct 18-20  – China National Congress

Oct 19-20 – EU Summit (Brexit to be heavily debated)

Oct 22 – Japanese elections

Oct 26 – ECB

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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Oct 6, 2017 - Market Update (Biz moving out making Catalonian politicians to think twice as Quebec is a nice example, NFPs & DXY - Good number Ok, bad number…because of hurricanes…as simple as that, EURUSD watching 1.1662 & 1.1615/05, USDJPY ready to test 113.25 & 113.37, Republicans moving on taxes, Fed warning of inflation/debt)

Short recap

Asia up, inspired by US stocks printing new highs on tax reform hopes

EU opening higher

Republicans moving on taxes, Fed warning of inflation and unsustainable debt

IMF still supports accommodative policy from ECB, BoJ

Italian CB asking ECB to soften bad-loan plans

ECB to put legal restrictions on ICOs

Bitcoin may fall to their jurisdiction anyway

But ICOs is a more securities area than monetary

Monday - US/CA markets closed on account of Columbus day/Thanksgiving

Spain to issue decree enabling firms to move their legal bases out of Catalonia easily

Catalonian politicians should think twice about independence as history of Quebec referendums shows. The QC voters scarred businesses in 1980 & 1995 so much, that  Bank of Montreal, Royal Bank of Canada and Sun Life Financial moved to Toronto. Toronto also replaced Montreal as the most populous city in Canada later on.

Equities

IBEX witnessed a correction yesterday

And Catalan leaders may soften the stance as business is moving out

E.g. biggest Catalan bank Sabadell moved HQ to Alicante with immediate effect

Boeing-JetBlue should be out with a small hybrid-electric plane in 2022

Aramco’s IPO in 2018 on track

Bonds

10-yr Trys yield at 2.35%

10-yr Bund yield at 0.45%

DXY

NFPs likely to have a very low negative impact on USD as tax reform moves on

Good number ok, bad number…because of hurricanes…as simple as that

Resistance at 94.02 (23.6% Fibo), 94.41 (100 DMA)

Support at 93.20 (10 DMA), 92.77 (50 DMA)

EURUSD

Leverage names were selling from around 1.1700

Resistance at 1.1708 (200 WMA), 1.1714, 1.1720 (38.2% Fibo), 1.1762 (10 DMA), 1.1780, 1.1812 (10 DMA)

Support at 1.1662, 1.1615, critical 1.1605 (50.0% Fibo), 1.1594 (100 DMA)

USDJPY

Breaking recent highs may open the door to go above 113.00

With resistance at 113.25 followed by 113.57, then 114.49

Support at 112.57 (10 DMA), 111.92 (200 DMA)

GBPUSD

Cable under pressure from May’s weak position within her party

1.3000 first level to watch, then 1.2943

On no Brexit deal risk can go to 1.26000 according to HSBC

Source: Saxo Bank

Gold

Resistance at 1273 (100 DMA), 1280 (10 DMA), 1281 (50.0% Fibo),

Support strong at 1268 (38.2% Fibo of Dec-Sep rally), 1263 (61.8% Fibo), 1253 (200 DMA)

Source: Saxo Bank

Data/events

US NFPs – 90k exp vs 156k prev

Unemployment rate at 4.4%

Earnings +0.3% vs +0.1% prev; 2.5% y/y

Despite Americans filling less for unemployment benefits

Hurricanes impact still casting a shadow over labour market

Fed’s Bostic (0915 GMT)

Fed’s Rosengren (1145 GMT)

Fed’s Dudley (1215 GMT)

Fed’s Kaplan (1245 GMT)

Fed’s Bullard (1300 GMT)

Oct 9 – US/CA markets closed on account of Columbus day/Thanksgiving

Oct 1-7 – Golden week holiday in China/Korea

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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Oct 4, 2017 - Market Update (IBEX under pressure, China conspiracy theory, Some US companies may revise down, Monsanto facing issues with new soybeans Xtend, Buffett likes Pilot Flying, New Fed Chair speculations riding USD and Trys yields, EURUSD - a new H&S formation?, Gold found strong support at 1268)

Short recap

Japan/Hong Kong up, China/SoKo closed

Europe opening mixed

UK heading towards hard Brexit on settlement bill dispute

Likely to be much larger than UK politicians think

But 2-yr transition period helps to remove pressure from GBP

Higher USD causing USD funding issues

A China Conspiracy Theory: "What If Beijing Is Behind The Entire Move?" SocGen Asks  link

Equities

IBEX under pressure as Catalonia to declare independence in coming days

Constitutional Court likely overrun the declaration what will lead to escalation

People are in the streets and some companies stop working

Spanish king involved with “unacceptable disloyalty” as well

A bit of caution is warranted as some US companies may issue guidance revisions to the downside over the coming days

And analysts will adjust their earnings estimates accordingly

The impact of Harvey and Irma is still being evaluated

Then, let’s turn positive for seasonal rally towards Christmas unless something doesn’t happen

Few thoughts from Warren Buffett  video

Likes Pilot Flying

Monsanto to report a loss on lower commodity prices and lower income from farms

Troubles with new soybeans tolerant to herbicide also to blame

Amazon to pay EUR 400 mln of back taxes to Luxembourg

Bonds

10-yr Trys yield at 2.32% - plenty of next Fed Chair speculations pushed yields lower.

Treasury Sec Mnuchin favors Powell

10-yr Bund yield at 0.46% - EZ yields lower while UK and Spain higher

Bitcoin

BlackRock’s CEO Fink – Bitcoin shows how much money laundering is being done in the world

Offers huge opportunities but presently is more speculative in nature

China’s bitcoin market alive and well as traders defy crackdown  link

As traders buy/sell bitcoin directly with each other via peer-to-peer market place and apps

All of that shows limitations of governments trying to control the market

EURUSD

Lots of ECB/Fed speakers till weekend and next Fed Chair speculations to move the market

Warsh seems to be the favorite (most hawkish, pro-USD)

If Powell is in, risk for USD

Other candidates: Yellen, Cohn, Taylor, Hubbard, Allison

Support around 1.1708/20 held, closing this week above 1.1836 can extend the USD weakness

Support at 1.1766 (Ichimoku) 1.1720 (38.2% Fibo), 1.1708 (200 WMA)

Resistance at 1.1780, 1.1812 (10 DMA), 1.1862 (23.6% Fibo), 1.1846 (50 DMA)

A new Head & Shoulders on EURUSD daily chart? Will see...

Let's peak back to around 1.1900

Then go lower towards 1.1450-1.1500 level...

Source: Saxo Bank

USDJPY

Market having difficulties to break 113.00 on Fed Chair/US yields

Bulls may get nervous if 113.30 not decisively broken

Resistance at 113.25

Support at 111.85 (23.6% Fibo), 112.28 (10 DMA)

Gold

Supported by weaker USD

Trump ratings heading lower, likelihood of more irrational behaviour growing

Resistance at 1281 (50.0% Fibo)

Support at 1272 (100 DMA), 1263 (61.8% Fibo)

1268 strong support (38.2% Fibo of Dec-Sep rally)

Data/events

ECB Governing Council meeting

ECB’s Draghi (1315 GMT)

Fed’s Bullard (1500 GMT)

Fed’s Yellen (1515/1915 GMT)

Fed’s Powell

Thu

ECB Minutes

ECB’s Praet (0430 GMT)

ECB’s Coeure (0815 GMT)

Fed’s Powell (0910 GMT)

Fed’s Williams (0910 GMT)

Fed’s Harker (1000 GMT)

Fed’s George (1630 GMT)

Fri

US NFPs – 98k exp vs 156k prev

Unemployment rate at 4.4%

Earnings +0.3% vs +0.1% prev

Fed’s Bostic (0915 GMT)

Fed’s Rosengren (1145 GMT)

Fed’s Dudley (1215 GMT)

Fed’s Kaplan (1245 GMT)

Fed’s Bullard (1300 GMT)

Oct 1-7 – Golden week holiday in China/Korea

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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