Oct 9, 2017 - Market Update (Quiet trading today unless..., Honeywell spinning off, Deutsche Borse working hard on moving euro clearing out of UK, JPM/Citi expecting lower trading revenues, BofA to benefit from cost cutting and expanding in retail, USDJPY - Peaking and may loose momentum as per daily chart/MACD)

Short recap

China in green after one week off

Europe in red

US/CA/JP markets closed on account of Columbus day/Thanksgiving/Health-Sports day

US banks/Trys closed but stocks open

NFPs good on earnings, the rest is a question of interpretation (hurricanes, steady jobs growth…etc.)

But USD not taking any clues

Should have quiet trading unless Catalonia declares independence

Or Trump announces something out of ordinary on Iran nuclear deal

EU having two issues at political level – Catalonian independence and how to handle it

And the rise of populism in Italy ahead of next year’s elections

Still Brexit ongoing while German economy at full speed with French numbers getting better as well

Brexit – no deal planning underway on UK side

Deutsche Borse working hard on moving euro clearing out of UK

Equities

Honeywell planning spin offs to streamline the business

Tesla benefiting from Puerto Rico need to restore power

Airbus living turbulent times (investigation of corruption)

Boeing injected GBP 100 into Monarch Airlines

Automation companies to benefit another winner of Trump’s tax plan

Activist investors looking to unlock value of Canadian real estate market

Earnings season is back

Sentiment is strong, valuations highs

Thus companies must deliver to justify valuations

Reporting this week: BlackRock, Delta Air Lines, JPMorgan, Citigroup, BofA, Wells Fargo

JPM, Citi expecting lower trading revenues, BofA to benefit from cost cutting and expanding in retail

Wells Fargo – sales scandal/reputation issues still up in the air

Bonds

10-yr Trys yield at 2.36% - finished the week lower on NFPs

10-yr Bund yield at 0.46%

COT report (as of Tue last week)

EUR longs at 91k vs 88k previous week

JPY shorts at 85k vs 71k previous week

GBP longs at 20k vs 5k previous week

EURUSD

EZ growth ok, CH private investors buying more assets abroad without hedging, some legacy shorts to be still closed out thus dips an opportunity to establish longs for 1.2500 (Source: Morgan Stanley)

Resistance at 1.1750 (200 HMA), 1.1755 (10 DMA), 1.1780

Support at 1.1720 (38.2% Fibo), 1.1714, 1.1699 (200 WMA)

 Source: Saxo Bank

USDJPY

Peaking and may loose momentum as per daily chart/MACD

Resistance at 113.00, 113.25 followed by 113.57

Support at 112.62 (10 DMA), 111.89 (200 DMA)

 Source: Saxo Bank

Gold

Managed to jump off the lows around 1263

On potential new NoKo nuclear test and lower USD

Resistance at 1296 (50 DMA), 1299 (38.2% Fibo)

Support at 1281 (50.0% Fibo), 1279 (10 DMA), 1273 (100 DMA), strong at 1268 (38.2% Fibo of Dec-Sep rally), 1263 (61.8% Fibo)

Data/events

US/CA/JP markets closed

Oct 9-15 – IMF/WB meeting

Eurogroup meeting

ECB’s Mersch (0745 GMT)

ECB’s Lautenschlaeger (1200 GMT)

BoJ’s Kuroda (2030 GMT)

Tue

Fed’s Kashkari (1000 GMT)

Fed’s Kaplan (1200 GMT)

Wed

Fed’s Evans (0715 GMT)

FOMC Minutes

Fed’s Potter

Fed’s Bostic

Fed’s Williams (1440 GMT)

ECB’s Praet (1450 GMT)

Thu

ECB’s Draghi (1030 GMT)

ECB’s Praet (1030 GMT)

Fed’s Brainard (1030 GMT)

Fed’s Powell (1030 GMT)

ECB’s Coeure (1600 GMT)

ECB’s Lautenschlaeger (1610 GMT)

Fri

Fed’s Rosengren (0830 GMT)

ECB’s Constancio (1015 GMT)

Fed’s Evans (1025 GMT)

Fed’s Kaplan (1130 GMT)

Fed’s Powell (1300 GMT)

Oct 18 – China National Congress

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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June 7, 2017 - Market Update

Short recap

Asia higher but risk off mood prevails while safe heavens in demand ahead of ECB, UK and Comey

Asia stocks up 2%, more than the rest of the region on consumers, value search and speculation about including China to ETFs

Europe opening mixed

Mnuchin on China – US to increase exports to address imbalance, splitting economic and strategic issues

US to watch FX to stay competitive, China used significant FX reserves

Trump pressing Congress over healthcare reform

Trump pleased by actions of Arab countries but US has the large air base in Qatar, so more relaxed talk will follow

US job openings skyrocketing, skilled workers in shortage

ECB bought a record amount of German bonds at negative yield last month (part of QE)

The step shows the shortage of positive yielding assets

Equities

Bayer exiting from Covestro

After Deutsche Borse-LSE deal went down, exchanges focusing on a low profile acquisitions/projects

Valeant to sell eye-surgery division to Carl Zeiss

Kaspersky taking on Microsoft

Wahed to offer robo-adviser services to Muslim investors

Banks warning on lower profits in Q2, blaming volatility

Bonds

10-yr Trys yield at 2.16%

10-yr Bund yield at 0.26%

China’s recent huge Trys buying likely aimed at keeping the yields low, thus supporting developed markets’ economies

What is in turn beneficial for China not only via internal deleveraging and possibility to attract foreign capital to its bonds

DXY

Support at 96.44 (38.2% Fibo) holding

EURUSD

Yesterday hitting 1.1283 before bids at 1.1284 mitigated the move

Question comes how long EUR can stay that high for?

Market keeps respecting 1.1300 despite lower US yields (bulls are definitely not happy about that)

Probably because of risk of ECB’s hawkish disappointment, very strong switch from EUR shorts to longs and huge China buying of US Trys, thus pushing the yields much lower (should be USD positive sign in longer term but correlation between USD and Trys purchases is weak)

Not expecting large moves today ahead of ECB tomorrow

But may see the cross heading lower on position squaring ahead of risk events

Resistance at 1.1284, then 1.1300

Support at 1.1227 (10 DMA), then 1.1180 (23.6% Fibo)

USDJPY

Quiet, waiting for tomorrow

May see some selling on spikes towards 110.00

Resistance at 109.60 (76.4% Fibo) with stops from 109.20, more below 109.00

Support at 108.12

Expiring options around 110.00 (USD 1.4 bln)

Gold

Gold reaching 2017 highs on low US yields, weak USD and risk off move ahead of events

Question is whether breaking the downtrend line is still a bullish confirmation

Resistance at 1300, then at 1307

Support at 1286 (76.4% Fibo)

Correlation with EURUSD is strong, so the 1300 level is also crucial for EURUSD while testing 1.1300

As gold may help EURUSD higher towards 1.1600 after clearly breaking 1300 line

If the 1300 is really strong enough to resist, we may have a look back at 1.1000 in EURUSD

But stay alert as risk events unfold

Upcoming Data/Events

G20 meeting

June 8 – ECB meeting – Draghi being alone but inflation data from US and JP suggesting ECB to carry on with ultra-loose stimulus

ECB likely to adjust the risk to economy wording but no change to asset purchases

June 8 - Former FBI director James Comey to testify before Senate (1400 GMT)

Unlikely, he would accuse Trump of interfering the investigation but will make him to suffer

Trump likely under investigation but no stopping of Flynn case request from Trump

If Comey doesn’t reveal anything new, markets should take it as a risk on and USD to benefit

June 8 – UK elections including Scotland, if SNP/Sturgeon wins the independence referendum likely to follow

Not the UK elections count but Brexit talks

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

June 13/14 – FOMC meeting – Jun hike probability at 95%, Sep at 28% and Dec at 40%. After Friday’s NFPs Sep hike may be skipped if data doesn’t come strong.

June 15/16 – EcoFin meeting to discuss Greece

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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Feb 27, 2017 - Market Update

Short recap

Asia started on a bad note but recouped the losses

EU markets opened higher

Trump not to cut social welfare programs: Social Security and Medicare

US Treasury Sec Mnuchin – fiscal stimulus impact this year muted (not helping USD and yields)

Busy week with plenty of Fed speakers to be watched for clues on Mar 15 rate hike (priced at 40%)

If there are no really strong comments, especially from Yellen on Friday, we should look at May or June meeting rate hike

Chinese Navy will benefit from rich funding as China to challenge US on the sea

Speculative longs in WTI from HFs reaching new high at 443 mln barrels

Russell 2000 lagging S&P 500 on fiscal stimulus delayed till end of summer or later

Note that small to medium caps will benefit more from fiscal stimulus, thus are much more sensitive to any news

LSE & Deutsche Borse merger unlikely getting approved by EU Commission

Nokia 3310 is back (by the way, I love my BlackBerry Bold…)

Stada is opening the books as a part of acquisition process

Bond yields hitting the lows on risk off and disappointment on Trump

10 yr US Trys yield at support level of the 2.31-2.55% range

GBP not feeling well on a risk of new Scottish referendum

EURUSD still in a range of going nowhere (1.0500-1.0680)

With 1.0500 super strong and battle ground within the range of 1.0500-1.0520 on the downside

Trump’s speech or US PCE inflation can shed some light on further direction

USDJPY – still very sensitive and may react strongly on Trump if we see lots of pro-inflationary talk that will spur the yields rise

Below 1125.50 we have next target 111.60 if Trump doesn’t deliver

Take a not of shrinking Ichimoku cloud on daily chart

Market may be pre-positioning for disappointment

May hit 110 or 115 (chance are widely open)

Vols pretty cheap either direction

Gold – 200 DMA at 1262 ahead of us

May see some profit taking ahead of Trump tomorrow

Fibo levels: 1250 (50%) and 1279 (61.8%)

Data

Mon:

EZ: Business Climate Indicator – to decline slightly

EZ: Consumer confidence – to decline more

US: Durable Goods Orders – to rise

US: Pending home sales – expecting 1% increase

Fed’s Kaplan (1600) – Q&A session

Tue:

2^nd estimate of US GDP expecting at 2.1% vs 1.9% last month

US: Consumer confidence – expecting no change

US: House prices – expecting 5.3%

Fed’s Williams, Bullard speaking

Trump at joint session of Congress (0200-0330 Wed)

Likely to express opinions and plans closer to Congress way of thinking than his ideas from presidential campaign

Wed:

US: Consumer spending – expecting 0.3% increase

US: Personal income – expecting 0.3% higher

ISM Manufacturing – expecting no change

Fed’s Kaplan, Brainard speaking

Beige Book

Thu:

Fed’s Mester speaking

Fri:

US: ISM Non-manufacturing activity index – expecting no change

US: NFPs only next week on Mar 10

Fed’s Yellen, Evans, Lacker, Powell, Fisher speaking

Super Wednesday Mar 15, 2017

Dutch elections

FOMC meeting

US debt ceiling deadline – if no agreement is reached as of Mar 16 the USD 20.1 trillion limit on federal debt is in place

What will stop Trump from his stimulus plans until the deal with Republicans is agreed

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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