Feb 21, 2017 - Market Update

Short recap

Asian stocks mixed despite some speculations about China getting back on track

EU to open lower with some caution ahead of Flash PMIs and after day off in US/CA

Volatility staying extremely low (as mentioned yesterday), no trigger in sight yet (may be Trump before Congress on Feb 28)

Difficult to time as the substantial rise in VIX is always steep

Oil supported by substantial jump in long speculative positions from managed accounts reaching record highs

Difficult to imagine what will happen if we experience sudden unwinding of positions

Seeing battle between OPEC cuts, higher demand from China vs rising US production

Iron ore higher today as per increased demand for higher graded steel from China

US homebuilders experiencing shortage of skilled workers

BHP Billiton reported higher profit on commodities rally

Warned about risks for metals and iron ore rally in the short term

HSBC disappointed as it struggles in its core markets, had a one off write-down, pre-tax profit down 62%

EM and China hitting the results

More and more speculative longs in Rubble sound like speculative accounts betting on rising oil

10 yr US Trys yield at 2.44%, we may see some selling pressure as US comes back

2 yr auction ahead of us can be a good gauge

Bunds range bound 164.07/164.94

GE-FR spread was widened again yesterday on Le Pen advance in polls

But new polls show Macron winning in 2^nd round (this one counts)

Some progress on Greece – bailout auditors coming to Greece again

But nothing else as EU officials do not want to irritate EZ public with Greece write off headlines ahead of crucial elections this year

Data

EZ: Composite PMI – expected slightly lower but still reaffirm the growth

US: Manufacturing PMI – expected higher

Will have FOMC Minutes and some Fed officials speaking this week but it shouldn’t be that relevant to the market after Yellen last week

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 13, 2017 - Market Update

Short recap

EU markets higher

Abe sure US will make major investments

Expanding free trade to be done in a fair manner

US will make currencies to fair level playing field but no specifics, USDJPY relief rally, later corrected

Risk of currency wars fading

The tax overhaul and incentive based policy part of next steps

On the other hand US lowering taxes and exporting more means stronger USD (unless they do something about it)

Likely Trump backed off from Taiwan issue (One China policy) for the benefit of Senkaku islands (China backing off from Japan control islands)

Likely something regarding North Korea as well

Trump administration will have a chance to fill three vacancies at Fed, thus can make a print on monetary policy after recent announcement of top official responsible for bank regulation resignation

North Korea biting again with medium- to long-range missile test

Canada Pension Plan (one of the biggest infrastructure investors globally) awaiting Trump’s plans but still too soon to see opportunities

Iron ore futures up 5.6% breaking important resistance

Oil – higher inventories may lead to additional OPEC production cuts

6 month period is too short for rebalancing the oil market despite high compliance with cuts

Some US financials may not be able to service the EU markets if Trump repeals globally imposed financial regulations

Sanofi to sell some OTC products to Ipsen

Stada becoming an acquisition target after receiving two offers

GE-FR and GE-NL spreads rising ahead of elections in NL (March) and FR (April/May)

Data

US: Treasury Inflation Forecast – expectations to edge higher

Yellen testimony (Tuesday/Wednesday):

For markets it is enough if she supports the view of Fed moving without looking too much at Trump

No need for a date and USD can find further support

Comments on balance sheet can be of interest

Gold – 1220/1245/1250 levels

To watch USD, yields, Trump tax plans

Specs keep increasing longs

AUDUSD – an inflation play

Next 0.7700, then 0.7750

To loose momentum needs to break below 0.7600

Specs longs in USD reduced further but still long USD 17 bln

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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