Oct 12, 2017 - Market Update (FOMC Minutes - debated inflation, JPMorgan & Citigroup reporting, Goldman Sachs back to investment banking?, EURUSD above 1.1830, heading to 1.2000 but..., CZK on the horse, Gold - which way now?, Homework time for Catalonia until Monday)

Short recap

Asia up reaching 10 yr high

Europe opening flat to lower

Spain gave until Monday Catalonia to drop independence

Otherwise will take over all powers over the autonomy region

Oil inventories rising even though OPEC is cutting production

FOMC Minutes – inflation debate intensified

Some patience to assess inflation path warranted

But others are looking at Dec hike

Doves and Hawks at Fed  chart

Repatriation tax rate at 10% according to Trump

Equities

A bit of reminder of .com area – A Biotech Company Changed Its Name to ‘Riot Blockchain’ and Its Stock Is Surging  link

Japanese equities may still look interesting but don’t forget that BoJ is still active in the market

Better days for banks ahead?  link

May get support from rising rates that will translate to higher profit margins

Citron (short seller) – looking to publish more of their research on Shopify

JPMorgan – should report a bit better results, focus on trading and loan business

Citigroup – expecting slight disappointment earnings

BlackRock enjoying the bull run as index investors take the AUM to USD 6 trln

Goldman Sachs looking to return to investment banking as it is looking for new deals

Bonds

10-yr Trys yield at 2.34%

10-yr Bund yield at 0.46%

Wealth manager warns on bond markets creating the 'biggest financial crisis of our lifetime'  link

Are bonds ready for a quick reversal as central banks look to remove QE?

Bond markets are at certain point illiquid

Guessing that ECB knows this one better as they have sometimes troubles to find suitable available bonds to buy

EURUSD

Catalonia is over for now, markets turning attention back to EZ macro

Back above 1.1830, opening the door for 1.2000

Resistance at 1.1910

Support at 1.1862 (23.6% Fibo), 1.1845 (100 DMA)

USDJPY

Resistance at 112.61 (10 DMA), 112.70 (Ichimoku turning line)

Support at 111.89 (200 DMA), 111.85 (23.6% Fibo)

EURCZK

CZK on the rising wave, now below 26.00

Resistance at 25.88 (10 DMA), 25.97

Support at 25.47

Bear in mind that it is still too early read the charts after CNB 27.00 floor adventure

But at least weekly chart can give us some clues where we are heading to

CNB sitting on tons of foreign reserves and now losing money

Some politicians calling for joining EUR

General elections taking place on Oct 20-21

 Source: Saxo Bank

Gold

Resistance at 1295/96 (highs), 1297 (50 DMA), 1299 (38.2% Fibo)

Support at 1281 (50.0% Fibo)

Source: Saxo Bank 

Data/events

ECB’s Draghi (1430 GMT)

ECB’s Praet (1430 GMT)

Fed’s Brainard (1430 GMT)

Fed’s Powell (1430 GMT)

ECB’s Coeure (2000 GMT)

ECB’s Lautenschlaeger (2010 GMT)

Fri

Fed’s Rosengren (1230 GMT)

ECB’s Constancio (1415 GMT)

Fed’s Evans (1425 GMT)

Fed’s Kaplan (1530 GMT)

Fed’s Powell (1700 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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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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Sep 8, 2017 - Market Update (North Korea/Irma - unhedged over the weekend?, Dovish Draghi but no indications, 10-yr Trys yield dipping below may bring more declines, EURUSD - 1.2000 a fair value, 1.2100 to hurt sentiment and DAX, Platina to catch up Gold rally, WTI at USD 55 unsustainable, BMW taking e-cars seriously, Amazon in a need of 2nd US HQ)

Short recap

Asia in red

Europe opening lower

ECB kept its policy unchanged

Draghi stayed dovish, has not offered any clear indication on what’s next

Despite strong EUR pushing inflation lower and economy doing well

Ifo head warning of next EZ crisis

Market keeps testing upside in EURUSD

North Korea (important public holiday 9.9. may be topped by another missile test) and Irma risks present – going unhedged to the weekend?

Equities

Eicher Motors interested in Ducati (USD 2 bln)

BMW firing on all cylinders to start mass production of e-cars

To compete with Tesla with 12 models by 2025

EURUSD at 1.2100 will be noticed by EZ stocks

Likely to change the sentiment, hitting DAX

An opportunity from Harvey/Irma as insurance (-12%), leisure stocks were hit yesterday

Insurance down 12%, while during Katarina declined 5% only

Hedging by S&P 500 makes sense

Amazon kicking out competition among cities in US

By announcing plans to build 2^nd HQ (USD 5 bln)

Apple likely to face supply shortage and delays in new iPhone production

Eli Lilly to cut off 8% of workforce

JPMorgan making consumer, retail and internet divisions to work closer

Best (Alibaba behind) launching IPO in US (USD 930 mln)

Bonds

10-yr Trys yield at 2.04% - dipped lower in Asia trading

The dip below 2% may see more declines

10-yr Bund yield at 0.29%

Investors unloading property bonds linked to Texas (hit by hurricane Harvey)

DXY

Below 2016 low at 91.88, closing there today?

If it does, more USD weakness is likely with target around 89.00 area

Close above may confirm the lows in USD

Lower capital demand, thus growing USD supply has negative effect on USD

Trump needs to deliver (tax reform for companies to increase investments) and Fed to hike to support dollar

EURUSD

Dovish Draghi but EUR higher…

As effects of higher EUR are offset by lower yields

1.2000 is the fair value based on models

Resistance at 1.2071

Market pricing first hike in June 2019

Area between 1.1850/1.2050 may be a new playground until FOMC and next ECB

USDJPY

Breaks 2017 low at 108.12

Heading to 105/106.00

Below 108.00 level looks attractive to Japanese investors

Gold/Platina

Resistance in sight at 1375/80 (Fibo 38.2%/2016 high)

Well supported by mix of low US yields, weak USDJPY, increasing amount of bonds trading at negative yield

Raising speculative positions and option hedging

Platina can catch up the gold rally soon, as it trades at discount

Oil

Harvey hit the oil biz in US and what about Irma that is stronger?

Decline in inventories offset by decline in production and refinery demand keep the oil rally in check

But getting to unsustainable levels with WTI getting closer to USD 55

Risk of correcting to USD 50

Data/events

ECB’s Weidmann (0900 GMT)

Fed’s Harker (1245 GMT)

Fed’s Dudley

Sep 19-20 FOMC

Sep 21 – Brexit – a major speech from May expected

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

Sep 29 – US debt ceiling deadline

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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May 17, 2017 - Market Update

Short recap

Asia in red on Trump mess

Europe opening lower

Trump to face tough scrutiny from Congress on meeting with Lavrov and sharing sensitive info

What would happen if Donald Trump were impeached?  link

European Court of Justice ruling – EU-UK trade deal doesn’t need to be ratified by all 38 EU’s national and local parliaments

Confirming the qualified majority vote of EU member states as sufficient

Kuroda – BoJ to continue the stimulus firmly

Atlanta Fed rising Q2 GDP forecast to 4.1%

Equities

UK gov to sell the remainder in Lloyds

Chinese Shanghai Pharmaceutical interested in Stada Arzneimittel

Yahoo planning a USD 3 bln share buyback ahead of merger with Verizon

Ford planning job cuts of white-collars

Delphi to work with BMW and Intel on autonomy driving project

JPMorgan shareholders not happy with Dimon advising Trump

KKR buying Q-Park (USD 2.2 bln)

Nasdaq offers enhanced data service based on robot intelligence

BGC launching e-platform to trade US Trys in June

NYSE planning a 350-microsecond delay on all in/outgoing orders

To use the similar set up at IEX Group does

Nasdaq printed new highs, helped by techs

As already mentioned stocks being resilient to global geopolitical and security risks

With VIX closing at 10.65

Earnings

Home Depot doing well as the revival in US real estate market goes on

And people keep refurbishing their dwellings

Cisco to report another decline in revenue as the company is striving to refocus from traditional activities to security, Internet of Things and cloud

Others reporting: Target, Tencent, Alibaba

Bonds

10-yr Trys yield at 2.30% - at critical support level, June hike still in place

10-yr Bund yield at 0.41% - Bunds jumped at EU opening pushing the yields lower

Greece readying for July bond issue if agreement with lenders in place

DXY 

Market is getting distracted from growth agenda by Trump mess and we may face delays in reforms

But US economy is in a good shape, earnings growing, labour market tightening…etc.

EURUSD

Cross supported by EZ data, Macron, Merkel, capital inflows, US politics/Trump mess

Having positive correlation with risk, FR-GE spread narrowing

50 & 100 DMA may break through 200 DMA soon (overall technical picture remains bullish)

May have a potential toward 1.1300 and 1.1500

But 1.1000 needs to hold, next 1.1130/40 and 1.1250

Some traders still sceptical about further move higher

Seems that the spot is getting way ahead of yields

Bund yields lagging the move, need to catch up to validify the move

Option expiries may keep the cross close to 1.1100

EURUSD weekly chart - facing the resistance

Upcoming

UK: Labour Market Report

EZ: Inflation data

Thu

ECB’s Draghi, Mersch, Nowotny, Lautenschlaeger speaking

Fed’s Mester speaking

Fri

ECB’s Constancio speaking

Fed’s Bullard speaking

Iran elections - impact on security and oil production

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 above 74% (CME) and 97% (Bloomberg)

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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Apr 13, 2017 - Market Update + Few thougths on Trump

Short recap

Asia lower

EU opening lower

Trump proved me wrong about non-event end of week

By the way, Trump not accusing China from currency manipulation anymore? Let’s call it a U-Turn…

Well, it is officially true from yesterday as he realized that it is him and not Chinese

Who is to be labelled as a currency manipulator when moving EURUSD to 1.0670 from below 1.0600

The move was based on his words about Fed keeping the rates low, USD getting strong and not flagging China as a currency manipulator

Also to remember that 40% of US debt is owned by foreigners

No surprise that Trump doesn’t want to mess up with them…that much

Don’t get confused by Trump’s rhetoric and focus on hard facts as Friday’s US CPI and Retail sales data are

As the stock market is closed on Good Friday, the reaction of bond market will be crucial for further direction of USD

US bonds close at noon local time

US: Headline CPI likely to edge up a bit despite lower oil but Core should stay in a focus of Fed (previous 2.2% y/y) anyway

Meanwhile Fed officials keep talking about staying on the track with rate hikes

And the start of reducing the balance sheet this year

US and Russia relations still below zero

While China is becoming a new friend of Trump especially on North Korea

A passenger of United Airlines taking the case legal

Global airliners should pay attention marketing wise

As overbooking, even legal, is a standard practice among many of them

Tesco’s corporate results above estimates as structural changes are paying off

Icahn via CVR Energy betting big on biofuels subsidies drop

Actually, started to do so before becoming an advisor to Trump

Some of Tesla’s investors pushing for adding independent directors to the Board

To balance Musk’s interests

Qualcomm paying USD 815 mln to BlackBerry over royalties

And keeps fighting Apple over chips

Volkswagen to build a new plant in US (USD 900 mln)

Bankers in Canada are doing well as CIBC is building a new HQ in Toronto for 15k employees

Earnings season

JPMorgan – expecting a raise in profit on better lending activity and activity in capital markets

Wells Fargo – expecting a small dip in profits due to legal costs

While should benefit from upcoming Trump’s easier regulation and higher interest rates

Citigroup – expecting a raise in profits as its global business is growing and higher activity in capital markets

10-yr Trys yield at 2.23%

10-yr Bund yield at 0.19%

Data

US: Initial Jobless Claims expected higher

US: University of Michigan Sentiment Index expected lower

Upcoming:

Apr 23 – French presidential elections

Apr 29 – EU Summit to sign off the Brexit negotiations guidelines – until then we won’t have clearer EU position on Brexit

May 7 – French presidential elections 2^nd round

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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