June 13, 2017 - (Trade Idea) Short GBPUSD - medium/long term, targeting new low

Hi,

 Right after UK CPI I mentioned on Twitter I took small, short position ( risking 0,15% ).

 What is my thinking ( come on great UK CPI number , why the heck you are short ? ):
 1. Highest UK CPI Since June 2013 would be great for GBP with „normal” economic growth. The thing is that we have high inflation based on weak pound and not because of the economic growth.

 2. There wont be „soft” Brexit In my opinion .

 3. Daily chart/ one of the strategy could support that view:

 4. FOMC and Yellen - dovish hike is priced in, looking for stronger dollar in a months ahead

 I gone short @1,2707 with stop 30pips above pre UK election high targeting…. Well something around 1,15/1,13 ( risking 0,15% for now ). Im ready to reopen that short ( under current mkt conditions In case of stop put risking 0,3% )

The another way could be GBPUSD PUT option expiry In late November with strike price In half way of target , for ex ample:

Please don't hesitate to contact Us should you have additional questions.
We are here to help you, just contact us at: landoftradingATgmailDOTcom.

Happy Trading

Mr Price Action

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, Blog: landoftrading.blogspot.com

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Feb 22, 2017 - Market Update

Short recap

Asian markets on positive note

EU to open higher

BoJ planning to be more transparent with announcing specific dates for bond buying operations (likely to avoid recent surprise moves)

Kuroda: ready to easy more

US Treasury Secretary Mnuchin-IMF Lagarde: IMF to evaluate FX levels and police FX policies

Fed Mester – at full employment, prices raising but don’t want to surprise the markets

US VP Pence delivered the marketing message of support for EU and NATO this weekend

But week earlier Chief Strategist Bannon had a different view

Spain is really firing at all cylinders with 2016 exports of EUR 255 bln from EUR 160 bln in 2009

Proof that the reforms they did earlier with weaker EUR work well for them

DAX to push higher behind 12 000 mark on strong data

US stocks with strong momentum but getting overvalued

Usually stocks grow with rising bond yields until 10 yr US Trys hit the levels around 3.9%

So there is still room but since US election we’ve got too high to fast

Daimler planning to build a plant near Moscow to produce Mercedes-Benz cars

It is a first major investment after announcing sanctions

Verizon agreed with Yahoo on lower takeover offer due to cyber attacks on Yahoo

EUR weakness not USD strength

Daily pivot: 1.0558

1^st daily support: 1.0502

2^nd daily support: 1.0468

3^rd daily support: 1.0412

76.4% Fibo: 1.0455, the level 1.0450/60 next strong support range

Low from 1997 at 1.0416

Then the lows of 1.0340 only

Gold weakness seen more against EUR than USD

XAUEUR printing new highs

Brent crude getting tighter as we get closer to potential squeeze

As calendar spreads for upcoming expiries rose substantially

What in turn can make the storing of oil outside US a losing trade

10 yr US Trys yields lower on softer PMI data yesterday but erased the loses later on

Currently at 2.45%, still below important resistance at 2.51/52%

GE-FR spread hitting 78 bps again on Le Pen

Data

GE: Ifo Business Climate Survey – to confirm the overall strength of GE economy, no big surprises expected

US: Existing Home Sales – set to surprise on positive side

FOMC Minutes – markets still not taking the Mar 15 meeting seriously despite Yellen’s testimony from last week

Minutes can shed a bit more light on whether Fed is eyeing to raise rates in March

Fed Powell speaking today, as he is a possible successor of Yellen

It is worth to watch him as he may provide additional clues on March hike amid strong figures from US

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 16, 2017 - Market Update

Short recap

Asian stocks still supported by Wall Street

US stocks still at highs, valuations adjusted for inflation at 1997 levels

USD did some woo-doo after very strong US data yesterday when profit taking erased all the gains

Yellen’s comment about “growth being quite disappointing” likely scared some traders

Despite US GDP growing very closely to Fed predictions

DXY dropped significantly from yesterday’s high, 50 DMA at 101.37 acting as resistance now

10-yr Trys yields printed 2.52% yesterday but retreated to 2.48% (as of writing)

Mar 15 hike probability at 44% from 34% yesterday

Oil lower on concerns coming from record high crude/gasoline stocks

Car registrations in EU up more than 10% what may benefit Volkswagen as it regains its share

Peugeot-Citroen acquisition of Opel/Vauxhall not welcomed in Germany/UK amid fears of loosing jobs

Tesla printing the highs

Nestle in line with estimates, EM markets still focus

US stock investors favoring international markets over “America First”

Canada Prime Minister Trudeau to address the EU Parliament before meeting Merkel

Will be definitely watch in Canada in the light of tweaking NAFTA as well as on EU side, as a free trade message to Trump

FX Options

EURUSD – likes 1.0600, scared of 1.0500

Trending lower (4 hour chart) despite a small break

RR favoring more and more EUR puts

Strikes with expiry on May 8 (FR elections on May 7) well bid

USDJPY

Vols supported by 10-yr Trys yields between 2.48%-2.52%

Not moving higher but should accelerate once spot moves higher

AUDUSD – good employment data

Small break above 0.7700 doesn’t look like lasting long

Vols trading at low levels, still have room to decline slowly

Implied vols lower vs realized

Data

EZ: ECB Minutes

US: Housing Starts – to increase slightly

US: Initial Jobless Claims – to increase slightly

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 15, 2017 - Market Update

Short recap

Asian markets up on Wall Street and Yellen

EU markets opening higher

SoftBank Group to buy Fortress Investment Group (USD 3.3 bln) as it is preparing to enter the private equity space

GM’s decision to put Opel/Vauxhall on sale is a turning point for the company as the company will exit the production in Europe

If talks with Peugeot-Citroen succeed the global auto map will be redesigned completely

CEOs of US retailers to discuss the border tax with Trump today

Studying Trump actions becoming a norm for professional investors (apart from fundamentals…etc.)

FinTech is venturing into M&A business of Goldman Sachs now after eliminating tons of trading jobs before

Momentum in financials seems to be firmly in place with Goldman Sachs reaching historic highs

But we may be getting a bit overstretched despite momentum

Trump’s New world is turning into New NATO and many European countries need to live up their 2% of GDP obligation

Thus seeing new opportunities on long side in: BAE, Leonardo, Lockheed, General Dynamics, Raytheon and Northrop

EZ peripheral yields falling down despite the ongoing clash between EZ and IMF over Greece

Greece not open to any further spending cuts; the situation may turn up badly at some point

Some US banks licensed to issue Panda bonds in China (inland)

USDJPY – levels 115.00 and 116.00 (cloud top)

EURUSD – 1.0566-1.0576/78

Yellen

Fed likely hiking on Mar 15 but need to watch job market and inflation expectations (probability at 34%)

3 hikes still in place for 2017 (prised at 50/50 for Dec); market is pricing 2 hikes

Waiting too long would be unwise

Trump policies are a big unknown/risk

Eventually, Fed can do pre-talk in March and hike on May meeting (despite no press conference)

Fed has an authority and responsibility to talk with global regulators

Data

UK: Labour Market Report – claimant count expected higher

US: Consumer Price Index – headline CPI to rise the most since 2012 while Core CPI expected slightly lower

US: Consumer Price Index – expected to slow down

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 14, 2017 - Market Update

Short recap

EU markets opening lower

Oil staying range bound on OPEC cut compliance vs non-OPEC production rising

The cut primarily by Saudis only

WTI very range bound 52-54/54.50

Negative bias on US shale oil production rise prevails in the market

Another blow to Trump after immigration ban legal issues as his security advisor Flynn was forced to resign on allegation of discussing lifting sanctions against Russia before Trump becoming officially a president

Trump not looking at major trade overhaul with Canada, likely just few adjustments here and there (marketing wise likely)

Lloyds Banking Group close to moving its EU operations to Berlin in order to keep access to single market

Apple at record highs on expectations of better sales figures from new iPhone (10^th anniversary) launch and customer demand

Closed at USD 133.29, what brings its market value toUSD 699.3 bln

All time high at USD 134.54 (Apr 2015)

Ivanka Trump branded production being dropped more and more

EURUSD below 21 DMA

Below rising medium term support line (now at 1.0620) connecting lows of Mar/Dec 2015

Through 38.2% Fibo

Next ones of interest are 1.0585 and 1.0530

Below just cycle low around 1.0340

Should we start to talk about parity on political risks in EU and yields divergence again?

Yellen definitely needs to confirm the Fed’s hawkishness

If she confirms 3 rate hikes this year, starting in June may be too late

Bear in mind that she might be geopolitical risk sensitive

US 10-yr Trys yield steady at 2.43%

10-yr Bunds yield steady at 0.33%

Data

GE: ZEW Economic Sentiment Index – to print slightly lower

US: Small Business Optimism Index – to print slightly lower after strong Dec

China PPI up to 6.9% y/y

Is it going to push EZ prices higher?

Fed can reach its 2% inflation target pretty soon as US imports cost more and rising prices for service are more evident.

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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Dec 13, 2016 - Story of the Week: Fed raising the rates by 50 bps tomorrow?

Hello mates,

So tomorrow is the big day, right? Well, still wondering what to really expect after few missteps from Yellen. Hike with dovish comments? No hike with hawkish comments? Or a surprise hike of 50 bps as the economy is growing and inflation pressures will kick in soon?

I believe we can all agree on a 25 bps hike that is already priced in by the market. The most important part will be the comments and guidance for 2017. Here, we are not likely to see dovish Yellen talking about 2-3 additional hikes next year even though Trump’s fiscal plans can support inflation expectations. We are also on the same page by saying Fed doesn’t have more or less any clear idea what to expect, what potential risks the economy might be coping with next year…etc.

What is a very strong signal proving that Fed is already behind the curve (we have expected Fed to raise rates in September) is the situation small and medium enterprises in US face. Actually, they already signal the shortage of qualified workers in some fields. As we move along, the economy is closing the output gap and the only question mark after OPEC/Non-OPEC countries agreed on crude oil production cuts is the level of capital investments. Still lacking a bit.

There is also another factor, apart from those we already discussed in The last big event in 2016 that we know about... and it is raising yields that may in turn support the banks, their profitability, improve risk models metrics and spur the lending activity to corporates as well as public.

Would you agree that it sounds like 50 bps hike tomorrow?

PS: Please keep in mind that the new US Government will likely look like a “US Inc.” sort of structure with all high profile and pro-business oriented people that will definitely push for more relaxed regulations and tax cuts.

Good luck Champs, let’s see tomorrow!

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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Dec 10, 2016 - FOMC - The last big event in 2016 that we know about…

The last big event in 2016 that we know about is coming. Can we expect any bad surprise from Yellen and her team? The probability of a 25 bps rate hike to 0.75% level is around 95%, in other words it is widely expected. Strong US data, the rise in bond yields and inflation expectations, and bullish stock markets seem to be supporting the case.

Facts

-          Probability of a 25 bps rate hike is priced at 95%

-          The hike is consistent with comments from Fed officials over the past few weeks as well as

-          US data coning in strong, the Trump presidential victory is pushing bond yields higher, reviving inflation expectations despite low crude oil prices and bullish stock markets towards the end of  year seem to be supporting the case

-          The pace of rate hikes in 2017 will depend on an increase in inflation, pace of labor market improvements and economic growth

-          Four members having the last meeting this week

Expectations

-          After last week’s ECB we expect volatility primarily in EURUSD, USDJPY and Gold but stocks as well as Emerging markets assets will not stay aside once the market will start to move

-          The hike may give additional support to USD towards the end of the year and in 2017

-          The Summary of Economic Predictions (SEP) should not deviate from the rhetoric and macro data we have seen in the past weeks

-          It is still very difficult to predict the tone of Yellen’s speech as she is clearly dovish but would need to acknowledge the good data and rate hike

-          Would be interesting to see whether they will mention the faster pace of rate hikes in 2017 on the back of bond yields jumping higher

-          Very likely after the FOMC meeting the markets will switch to Christmas holidays mode with nothing really going on but low liquidity and abrupt moves

By the way, I am sure you have already figured out that the stocks despite the expectations of rising rates are moving higher. Shouldn’t they be lower?

Well, the Trump’s expected corporate tax rate cuts and deregulation do the job.

Before we actually get to FOMC meeting let’s check what history can show us first.

Every significant Capacity utilization increase was followed by rise in interest rates:

To refresh the memory have a look at Historical rates (Source: Wikipedia):

Enjoy...

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 21, 2016 - EURUSD 1 hour pre-FOMC chart

Hello guys,

A quick look at EURUSD 1 hour FOMC chart:

We like this channel from intraday perspective:

Above 1.1330 possible 1.1450 then watch for weekly close

Below 1.1070/50 means Yellen did well, watch for weekly close.

All of these levels are intraday and close above/below extremes may push prices further and that could be something bigger but weekly close is important at this point.


Please let us know should you have any additional questions or you would like to discuss other crosses as well. We are here to help you, just contact us at: landoftradingATgmailDOTcom.

Happy Trading

Mr Price Action

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 18, 2016 - FOMC meeting (Sep 20-21) – a discussion about exit strategy, really?

Now or in Dec? Data are ok, we are not all 100% sure yet but… should we wait until Dec? Hmm, Trump president, data might be worse, lots of international risks like Spanish elections, referendum in Italy or Brexit going wrong…our credibility…hmm…

Few words about current developments:

-          The market expectations for a rate hike in Sep are around 20% and 50% for Dec but we should more see it as either a dovish hike or hawkish no hike. Meaning Fed will either hike but will have dovish comments or will not hike and will refer to Dec with some wording about data dependency…etc.

-          Apart from present market risk related to uncertainty and very low predictability of Fed’s actions market is watching underlying data to get some hints about economic growth, inflation and employment. As the economy is getting closer to full employment, the GDP and CPI/PCE numbers are gaining importance.

-          Steepening of the yield curve at longer end – we may see it as market reshuffling over to shorter term maturities based on rate hike expectations

-          Division of the FOMC officials – of course as always is the case

Our expectations:

-          Our base view is one hike in Sep and eventually second one in Dec if data support. Please read more on:

Jackson Hole coming, but what about the rate hike…?  and  US job market - Full time vs. Part time employment

-          The GDP growth may not be at the level all Fed officials would like to see, eventually we may have a different picture after elections but the economy is overall growing and doing well

-          The question about full time employment is also off the table as almost all FOMC members share the same view that the economy is close to full employment with unemployment rate at 4.9% vs 4.8% (Fed’s full employment rate)

-          The only question is inflation - the headline PCE and core PCE. The Fed’s projections show expectations at 1.9% for 2017 and 2% for 2018. The last figures were at 0.8% and 1.6% y/y respectively.

-          As the inflation is lagging the economic growth and monetary actions, we see that the rise of prices is on the right track. Do not forget about still very low oil prices, that housing market is stabilizing and that the costs of medicare will not be a huge contributor to PCE due to administrative measures in place.

-          All in all – data is good enough to support the Sep hike, restore the credibility of the Fed, confirm its data dependency and independence ahead of US elections as well as avoid another round of confusion as we had witnessed last year

-          Fed officials will likely avoid facing the risks of no hike this year (as per risks described on top of the page) and vote for a 0.25% rate hike from almost a zero level what is from a historical perspective completely irrelevant level

-          By gradual hiking (starting in Sep) they will create a room for rate cuts if necessary, to face recession risks in the future. Doing that will also allow to push away discussion about negative rates in US. 

-         From a completely different perspective a rate hike would mean the beginning of the return to normal monetary policy, breaking the dependence on central bank funding, pushing for fiscal and structural reforms, and more innovation 

-         The reaction of the markets – let’s have a look at S&P 500. There is something strange going on as US stocks should be much lower to our taste before a rate hike. Is Fed cooking something for us?

-         The rate hike may be a confirmation for the markets that the US economy is doing well. Of course the initial reaction will be a small pullback that will be followed by a strong rally.

-        In case of no hike, we can see a stop hunting rally and a huge sell off after. Exactly the opposite to what markets are expecting at the moment.

Well, any questions just ask…

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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Aug 28, 2016 - Weekly Macro 35W

In the coming week we will get plenty of PMI´s and also US employment data. First we will start however with US inflation, more accurately with the indicator mostly watched by the Fed – The Personal Consumption Expenditures. While year on year the Core CPI is already at 2.2% and would exceed the Feds inflation target justifying another rate hike, the Core PCE is only at 1.6% and couldn´t get any closer to the Fed’s target since April...

Last Week

After a boring Monday the European PMIs and New Home Sales from the US were supposed to bring some volatility into the lazy summer markets the next day. While the European PMI data came out mixed on Tuesday, the latest US New Home Sales caused a big surprise coming out at 654 tsd. as we haven`t seen such number since 2008. The construction sector is an important component of US GDP its share on the US GDP is declining and therefore any sign of revival is very important. However, on Wednesday the Existing Home Sales in the US came out worse than expected as failed to hold the 5.5 million level. The increasing Crude inventories surprised the market and caused a drop in WTI testing again the $46.5/barrel, USDCAD didn`t react much on the news despite the dependence of Canada on the oil industry. On Thursday the market focused almost purely on the awaited speech of Janet Yellen in Jackson Hole schedule for Friday and ignored the weak German Ifo Business Climate and the better than expected Durable Goods Orders which increased in the second fastest pace in the last 27 months. On Friday the kind of hypnotized trading mode continued. The GDP estimates from UK and US where in-line with expectations and the market reacted little. The rock`n`roll started after Yellen`s speech. While she said the case for rate hike strengthened in recent months at the end stressed the outlook is still uncertain, and rate hikes are not on pre-set course. The US labor market is close to maximum employment and the FOMC anticipates further strengthening. Regarding Fed Funds Rate, Fed anticipates gradual rate increase. According to Yellen the Board of Fed governors see inflation rising to 2% in the next few years (keep in mind that inflation is measured by Fed by Core PCE Price index) and they are not considering higher inflation or nominal GDP targets. After initial half an hour confusion finally the market translated the message (together with several Fed governor statements during the day) as hawkish. USD strengthened in the last few hours of the trading week 1.1% against EUR and GBP, more than 1.7% against JPY and AUD and 2.1% against NZD.

Next week

Monday (USD, JPY):

On the first day of the week Jackson Hole Symposium will probably resonate all over the marketplace. Also the Personal Consumption Expenditures will be released, which is the Feds inflation indicator. While year on year the Core CPI is already 2.2% the Core PCE is only at 1.6% and no change is expected for Monday but looking at the bullish mood on USD from Friday, any positive surprise can easily cause further dollar strengthening. Before midnight we will take a look at the spending of the Japanese households. The notoriously weak private spending is a key problem of reaching the BoJ`s inflation target.

Tuesday (AUD, GBP, EUR, USD, CAD):

Early morning AUD traders should be ready for some volatility as the Building Approvals missed estimates in the last 2 months. The data is a leading indicator to inflation and growth and will be watched closely. The RBA cut the cash rate on the 3^rd of August by 25 bps and while there is no expectation that the RBA will cut again on the next rate decision scheduled for the 6^th September. During the day plenty of European data will be announced, but early afternoon the Canadian Trade balance numbers will show us if there is any tendency to get into positive territory where the economy was last time in 2008. Later the Conference Board Consumer Sentiment survey will be released. As it´s a leading indicator to US economic activity this could be the data of the day.

Wednesday (NZD, EUR, USD, CAD):

Early morning the ANZ Business Confidence, the result of a survey of about 1500 companies will be released in New Zealand. Could be important as kiwi finished the week with a shooting star on the weekly chart confirming a kind of engulfing pattern (not clear) a few weeks ago however it couldn’t close below key support 0.7200. In the morning we will have important data from Europe, German Retail sales and Unemployment change first, and later the Eurozone flash Inflation could spur the EUR. In the afternoon we will focus on the US ADP employment and 1.5 hour later the Chicago PMI with Pending Home Sales. According to Yellen the US employment is close or at its maximum so there could be a lower reading in ADP but Pending home sales could surprise to the upside as last week´s Existing Home Sales were weaker than expected and the key could be in the number of the unfinished purchase contracts. The Monthly GDP from Canada is expected to be well in positive territory after a negative surprise last month. Later the EIA Crude inventories will affect the CAD as well.

Thursday: (CNY, AUD, EUR, GBP, USD):

It`s going to be a PMI day and even the market will be waiting for the NFP next day, there could be interesting moves. Especially the Chinese Manufacturing PMIs where the 50 point level is the threshold of recession. The official PMI dropped below 50 pts last time but the Markit PMI hold above. Between these two data the Australian Retail sales and Private Capital Expenditures will be released. As the last rate cut had practically zero effect on AUDUSD, this could give us a hint whether there is a chance for further rate cuts in the fall. We will continue the day with the Spanish, UK and US ISM manufacturing PMI, from these the later has the biggest potential to move the markets. The US jobless claims and US Non-Farm Productivity released in between the PMIs could give a hint if Yellen was right on Employment last Friday.

Friday (GBP, CAD, USD):

One of the most watched US number will be released in the afternoon, the US Non-Farm Payrolls. However, in the morning we will have first the UK Construction PMI. Very important if we think there is a bubble in the UK property market. Even though the last reading showed a slight improvement, the trend in the sectors PMI is not encouraging. While in the first half of 2014 the figure was above 55 points each months, in 2015 hardly could reach this number and the average was around 52.5 and this year only twice reach 52… The US NFP is expected to hold but as the economy is near full employment, there could be come negative surprise.

Have a successful week and don’t forget:

Watch you risk and be consistent in your trading!

Mr TechMan

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: landoftradingATgmail.com

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Aug 24, 2016 - Forex: Jackson Hole and Yellen - Charts

As Mr Hawk perfectly painted the macro picture here , we are USD bullish into Jackson Hole and  NFP next week.

Before we start, would like to point out here, we don't want to trade USD blindly. We do have a plan, we know where we want to open, where we want to exit and we know what kind of the risk we want to take... in advance.

So, let's check few charts and discuss possible scenario ( how we would like to trade it / what has to happen ) :

 1. First important thing: we see some room for USD weakness and we would like to see that before Friday

DXY - it's an update to our Weekly Tech Overview ( please check here )

EURUSD daily chart - market is re-testing broken trend line. The best scenario would be stop hunting above 1,1350+. So, we are looking to sell rallies towards 1,1350/1,1450. Weekly close above 1,1450 will cancel the bearish scenario.

USDJPY weekly chart - no change in our view, we are still bullish here even we have been stopped out at entry level on our Trade Idea here

AUDUSD weekly chart - no change to our view we presented here. The only thing is that bulls are already tired. So, we do have two possibilities here: 1. TL on weekly will be too much for bulls or 2. bulls will go higher and eventually will test 0,80 before sell-off.

GOLD ( XAUUSD ) - daily charts, we are looking to sell. Close above 1380/1400 will invalidate the bearish scenario.

Good Luck All

Mr Price Action

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: landoftradingATgmail.com

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Aug 23, 2016 - September 2016 Event Calendar

September 2016 Event Calendar

As the Olympics are over, the impeachment trial against suspended Brazilian president Rousseff can start. But this one is not that important in Sep when looking at the below:

Aug 26 – Yellen speaking in Jackson Hole (Symposium Sep 25-27)

Aug 31/Sep 1 – G20 FinMin and Central bankers meeting

Sep 2 – US NFPs

Sep 4-5 – G20 meeting in China (first ever)

Sep 7 – BoC meeting

Sep 8 – ECB meeting

Sep 9-10 – informal EU Economic and FinMin meeting

Sep 15 – BoE meeting

Sep 16 – EU Summit in Bratislava to discuss Brexit + other topics

Sep 20-21 – BoJ (a complete assessment of monetary policy and further stimulus measures are expected)

Sep 20-21 – FOMC meeting + Economic projections + press conference

Sep 26-28 – OPEC meeting to discuss potential production freeze

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: landoftradingATgmail.com

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Aug 22, 2016 - Jackson Hole coming, but what about the rate hike…?

Jackson Hole coming, but what about the rate hike…?

As the ongoing trust in Fed is close to zero, we may eventually see a bit of nervousness before Friday. We may spot some unwinding of the big position and abrupt moves, as the market clearly doesn’t know what to think or expect from Yellen. All of that despite pretty hawkish comments from Dudley and Williams last week, supported by Fisher over the weekend. This provides a short-term strength for USD at the moment.

So what’s the bet?

Looking at 4 rate hikes? This one is off…

Dec hike, looking like…

Oct hike, Fed hurry up before US elections…

Sep hike, well, the credibility of the Fed and its officials may increase by an inch from zero…

Questions

When we look at the history, Fed is cutting the rates when stock market is really going down. But where it is now? Printing new historical highs…, so it is the time to raise rates, right?

What about housing market? Peaking again…A time to raise rates, right?

What about USD? For some reason it is still not clearly moving higher…Why?

Economy and job market getting better, GDP growth is accelerating and with inflation getting close to Fed targets…Hiking?

Investments to recover after US elections, the effects of stronger USD to fade away…

Productivity slowdown? As Fisher said, we don’t know to measure it properly…

Slowdown in China, Brexit aftermath, debt issues in Europe, US elections risks? Worth to consider…

All of these are good questions but very likely, Yellen will not provide us with any clear signal. Has she ever?

Our take

We see two hikes this year and the first one will likely come already in Sep, so there will be some time for dust to settle before US elections. For those who see the same, the long USD, underweight or short US 10yr or 30yr Treasuries, and short silver and gold, may be the right trade. The question of regaining a bit of trust of market participants in predictability and communication ability of Fed officials will be tested again.

The second hike in Dec will be really data dependent in the light of results of US presidential elections of course.

Risks

Data, data and again data. Yellen at Jackson Hole will again point to data dependency (US NFPs are on Sep 2 while FOMC on Sep 21).

From political perspective the Brexit vote shock aftermath or US elections risks are also taken into account but at the moment, the risks related to US elections, seem to be bit ignored by bond markets. But what about the Fed?

All in all, the Jackson Hole speech may be again a non-event as it was 9 times out of last 10 speeches, apart from the one in 2010, when Bernanke announced the QE2 preparation.

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: landoftradingATgmail.com

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