June 8, 2017 - Market Update

Short recap

Asia mixed

Europe opening higher

Oil was heavily hit by strong rise in US inventories and products amid OPEC efforts to cut production/supply

According to Comey’s prepared statement Trump asked him to drop an investigation of Flynn

But nothing new what would surprise markets

Markets getting ready for ECB, Comey, UK elections and Qatar/N. Korea mess

Canada to boost defence spending as US is less reliable

I like this one too as many countries used to take US defence umbrella for cheap money and are not happy with Trump now

Equities

Banco Popular rescue scheme can be use for Italian banks as well

Delphi Automotive partnering with Transdev Group in the field of shuffle service

Apple working to shorten repair times

BlackBerry out with car computer system

Goldman Sachs to increase deposit rates

Bonds

10-yr Trys yield at 2.18%

10-yr Bund yield at 0.26%

DXY

Support at 96.44 (38.2% Fibo) holding

Resistance at 97.85 (50% Fibo)

EURUSD

Recouped the losses after inflation downgrade leak yesterday

As market still believes in hawkish ECB

Resistance at 1.1284, then 1.1300

Offers towards 1.1300 (option barrier), likely lots of stops above

Support at 1.1230 (10 DMA), then 1.1180 (23.6% Fibo)

Expiring options at 1.1200 (EUR 1.7 bln)

Tomorrow we have heavy expiries both below and above 1.1300

USDJPY

110.00 important with heavy option expiries tomorrow too

Support at 109.60 (76.4% Fibo), then at 108.12

Resistance at 110.44 (200 DMA)

GBPUSD 

Still holding well despite upcoming Brexit talks

1.2974 in focus followed by 1.3046

With stops sitting above 1.3050 and 1.3100

Support at 1.2802 (50 DMA), then 1.2768

Stops sitting below these levels

Should see a relief rally after Conservative win

But to fade later as we refocus on Brexit talks

EURGBP

0.8786 and 0.8850 may be in sight

Gold

Resistance at 1300, then at 1308

Support at 1286 (76.4% Fibo)

Upcoming Data/Events

G20 meeting

ECB meeting – getting grow but where is the inflation?

Draghi being alone but inflation data from EZ, US and JP suggest ECB to carry on with ultra-loose stimulus

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

QE exit likely touched a bit with no precise dates

New staff predictions for 2017-19 to be released

Overall, Draghi will have top dovish performance while bit of admitting of a small shift

Sep meeting to be critical with respect to forward guidance

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

Prepared remarks for semi-official hearing  link

'I need loyalty, I expect loyalty'

"I didn't move, speak, or change my facial expression in any way during the awkward silence that followed."

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

Overall little impact on markets

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

Not the UK elections count but Brexit talks

2100 GMT -  Exit polls

2200 GMT – First districts counted

02-0400 GMT – decisive amount of districts counted

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

Read More

May 31, 2017 - Market Update

Short recap

Asia up on better steel industry performance that pushed China factory activity higher

Europe opening mixed

Trump's head of communication is leaving – who knows why?

Wouldn’t be better if Trump has left and all the other staff members stay? The problem is solved then…

USDCNH down as overnight funding rising

EU Commission proposing EMU gov debt securitization (thus packaging debt of different countries together)

After GE refused the idea of Eurobonds

Equities

Vivendi closer to controlling Telecom Italia on EU antitrust approval

Struggling IT banks Banca Popolare di Vicenza and Veneto Banca – one of the options is to close them if no state aid solution is agreed on

LSE buying bond data and index business from Citi (USD 685 mln)

Amazon above USD 1000 watermark to attract more buyers

As analyst expect another 10% push higher on average

Gilead Sciences and GlaxoSmithKline go tough in HIV drugs

Goldman Sachs bought USD 2.8 bln bonds of Petroleos de Venezuela bonds at discount

BlackRock CEO – US financial markets “probably fully priced in” and Q2 earnings could dissappoint

Few words on stocks…

Some argue that stock prices are too high but after considering the slow pace of interest rates rise, they are reasonable for the time being. Of course, staying vigilant is important but some sectors like mining or Japanese equities (trading at 20% discount to US peers) may be of interest. Earnings are solid, still favorable to be investing in stocks based on earnings performance, few unknowns on the horizon like North Korea, Trump, China growth or possible snap elections in Italy as we head to quiet summer period.

So what’s next? Well, the ECB’s possible wording adjustment in June and then Fed’s 3^rd rate hike and taper in H2.

HP to report the slide in earnings amid the push towards more focussed strategy and data center hardware business

Palo Alto Networks to report lower profit despite fast-growing cyber security industry. In case of the company, the competition bites.

Bonds

10-yr Trys yield at 2.22%%

10-yr Bund yield at 0.28%

Brainard dovish on soft inflation (thus pushing Trys yields lower) but expecting rate hike pretty soon

EURUSD

Month end flows likely visible

Closing below 1.1140/55 range the 1.1000 is in sight

As the next likely 1.0840

1.1000 – growing in importance

1.1128 (61.8% Fibo Nov/Jan)

Expiring options around 1.1150 level, towards 1.1200 and large at 1.1250

USDJPY

Resistance at 111.00

Next 50 DMA at 111.21 and 50% Fibo at 111.24

200 DMA at 110.20 – a pretty strong support right above 110.00 level

GBPUSD

Polls changing the game and potentially election outcome for May

As she may not be able to form the government alone what in turn would weaken UK’s negotiation position in Brexit talks

1.2775 is the next to watch, followed by 200/100 DMA at 1.2586/1.2573 levels

Data

EZ: Flash CPI

Core CPI should move back close to 0.8% level (market expectation 1.0%) vs 1.2% prior

CPI expected at 1.5% vs 1.9% prior

Former FBI director James Comey to testify before Senate (tentative)

Beige Book

ECB’s Coeure (0720 GMT), Lautenschlaeger (1230 GMT)

Fed’s Kaplan (1200 GMT), Williams (2330 GMT)

Thu

ECB’s Villeroy

Fed’s Powell

Fri

US NFPs 185k exp vs 211k prior

Unempl. rate 4.4% exp vs 4.4% prior

Average earnings +0.2% exp vs +0.3% prior

Fed’s Harker

EU-China Business summit (Juncker/Li)

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

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

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

June 13/14 – FOMC meeting – hike probability was at 89% after yesterday’s data. If data supportive, we may see one hike in June, then in Sept followed by balance sheet reduction announcement in Dec

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

Read More

May 26, 2017 - Market Update

Short recap

Asia down as OPEC disappointed the market by not delivering what traders hoped for

Cut extended for 9 and not 12 months, expected deeper cuts

Oil was down 5% and still heavy today

Europe opening lower

Risk off continues on OPEC, lower yields and dovish Bullard (inflation worrisome, Fed aggressive)

Looking forward to balance sheet reduction in H2

Trump’s son-in-law who is a part of his senior advisers team is under FBI investigation over Russia

USD 20 bln Blackstone-Saudis deal underlies how important Blackstone is for Kushner’s family

As they borrowed from the company few hundred mlns and company worked on their NY mansion

Moody’s - China not able to curb the debt, risk of another downgrade

China to change Yuan fixing formula to adjust for lower volatility

China not to pursue a competitive devaluation

UK consumers hit by rising prices

UK’s May falling in polls, GBP down

Equities

Full “bail in” talk of regional banks Popolare di Vicenza and Veneto Banca

Denied by officials

GM facing a lawsuit over emissions

Ford behind GM in new models

Canadian banks don’t see the threat to their business from fallout of Home Capital

Bonds

10-yr Trys yield at 2.25%%

10-yr Bund yield at 0.36%

Fed funds rate vs EURUSD  link

EURUSD

Offers around 1.1250-60

Still lots of bid below

1.1314 (76.4% Fibo)

1.1128 (61.8% Fibo)

USDJPY

Bids towards 111.50, more towards 111.00 – range with heavy option expiries as well

Offers may be present going to 112.00

50 DMA at 111.25 and 50% Fibo at 111.24 acting as support

Iron ore

Inventories highest since 2004 (136 mln tonnes)

Important support 450

Data,

G7 meeting (growth, employment, security)

ECB’s Coeure (2000 GMT)

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

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

Read More

May 18, 2017 - Market Update

Short recap

Trump – Special Counsel headed by former FBI director Robert Mueller to investigate Trump-Russia connections

Risk off overall, messy market reaction in Asia but creation of the Counsel may temper down the nerves

USD - no clear direction for the market today yet

USDJPY – no clear safe heaven buying reaction overnight

Market still to face uncertainty until more clarity on the scope/areas of investigation and schedule is known

The investigation can take months/years

Republicans likely to prepare their own healthcare, tax and infrastructure bills, not waiting on Trump to clean up the mess

It will also serve as a way to differentiate from him

As mentioned yesterday, Trump is a small piece of US long term economic growth

Investors may be distracted and overlooking that US economy is strong enough to cope with Trump mess (productivity and capital wise)

Impeachment still way way far from here and need 2/3 of Senate vote

Possible impeachment – only three presidents faced it, namely Andrew Johnson (1868), Richard Nixon (resigned after Watergate scandal in 1974) and Bill Clinton

Fed June rate hike at 65%

EU rethinking the capital market union due to Brexit

And get the large chunk of trading in euro-denominated instruments currently traded in London

Equities

Elliot Management met with BHP Billiton yesterday

DOJ to file a lawsuit against Fiat Chrysler if no agreement over emissions

VIX jumped 45% yesterday

Investors taking profits and positioning with more caution also due to weaker US data

To watch materials, techs and financials, as they may suffer

Bonds

2-yr Trys yield at 1.26%

10-yr Trys yield at 2.24%

10-yr Bund yield at 0.37%

EURUSD

Lots of ECB speakers today, likely to send a united message after sharp EUR jump

Market staying nervous

Selling interest may be seen within 1.1180/1.1200 area

No real resistance until 1.1300 (high), eventually at 1.1250

Support at 1.1073 (76.4% Fibo) and 1.1028 (high)

USDJPY 

Cross staying heavy towards 111.50, likely stops above

Interest seems to be at 110.50 (61.8% Fibo) with stops below

US politics and yields in charge

Gold - approaching possible supply zone based on daily chart, watching

…looking to buy USD? USDCHF might be the candidate

Upcoming

ECB’s Weidmann (0700 GMT), Mersch (0750 & 1230 GMT), Lautenschlaeger (1245 GMT), Nowotny (1250 GMT), Draghi (1700 GMT) speaking

Fed’s Mester (1715 GMT) speaking

Fri

ECB’s Constancio speaking

Fed’s Bullard speaking

Iran elections - impact on security and oil production

May 24 – former FBI director James Comey to testify before Senate (1330 GMT)

May 25 – OPEC/Non-OPEC meeting

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 – market pricing rate hike at 65%

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

Read More

Mar 21, 2017 - Market Update

Short recap

Asia printing highs

EU markets opening higher

Macron the winner of French presidential debate but Hillary Clinton was too

Weidmann (ECB) current policy is appropriate

Evans (Fed) will make decision about next hike in June

Will know more about financial and fiscal conditions and data

A small reaction to his speech only

UK to trigger Art 50 on Mar 29

FBI investigating links between Trump’s campaign and Russia

China to open further its economy to foreign capital (services, manufacturing, mining…etc.)

To support foreign securities listings and investments in science, technology and infrastructure

All of that seems like the opposite to Trump world

BNP Paribas ready to fill the gap in investment banking field in Europe

As it sees opportunities after its rivals scaled back activities there and in a hunt for an increase in revenue

Porsche family interested in Porsche shares owned by Piech family

Nike reporting today, struggling with increasing competition from Under Armour and Adidas

Eli Lilly having positive results from a combination of drugs treating breast cancer

Opel cleared in France in diesel emission investigation

S&P 500 still in uptrend

Support at 2365 then 2354

DAX still in uptrend channel

Support rising trendline, 11 930 and 11 480/500 levels

Oil not much upside potential

Likely to settle in lower range

Gold neutral

Levels: 1220-1238 then 1261 and Fibo levels

10-yr Trys yield at 2.48%

Saw additional strength in Trys as June hike priced lower at 40%

Risk of Trys yields to decline to lower range of 2.30%-2.50/60% band

Data

UK: Consumer Price Index expected to rise above 2%

UK: CBI Industrial Trends Survey ready for a slight decline

US: Current account expecting deficit to widen

JP: BoJ Minutes

Speakers (GMT)

BoE Carney (1035)

Fed: Dudley (1035), George (1600), Mester (2200), Rosenberg

Central banks’ future action:

Fed toward 3%

BoE not before late 2018

ECB and BoJ no action

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

Read More