25/8/16 NQ trading

At 4820, it looks like NQ is uptrend. Price sticking to upper BB, bouncing off mid BB. At 4810, price sticks to lower bb, bouncing off mid BB. 

Thus 4810 is the right short pt.

4820 is not a good short pt by BB theory.

FX 23-8-2016

EURUSD is lagging behind others GU, NU, AU and thus correlation indicator is used to determine the timing of Long EURUSD.

FX_CL4_22-8-2016_15min.jpg

GU +0.4, AU + 0.4, NU + 0.4, EU + 0.1 –> Long EURUSD.

FX_CL4_22-8-2016_15min_done.jpg

EURUSD ended the day with +0.4%. Up 0.3%.

FX_22-8-2016_15min_done.jpg

In candlestick chart, thats the Long, TP1, Tp2 points.

 

FX Analysis (22/6/16)

Now risk off assets r down. Bonds, bunds, gilt, gold. Risk on assets are up. Oil, stock indices.
Market has priced in brexit, and expected it to not happen. Thus market is ready to rally stocks again.

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Market Bias 16/5/16 -20/5/16

Market Bias 16/5/16 – 27/5/16

USD: BULLISH
NFP for April missed on the headline figure at 160k vs 202k expected. However, Average Hourly Earnings came in as expected at a solid 0.3% rise for the month, which bodes well for the inflation picture and prompted some upside in the USD post release. The Fed’s April 27 statement failed to provide any further clarity on when the Bank may raise rates. There was no indication in the statement that a rate hike is likely in June, with Fed fund futures pricing a less than 20% chance of a hike at that meeting. CPI for March slightly missed estimates with Core dropping to 2.2% y/y from a prior of 2.3% and for the month, missing estimates at 0.1% versus 0.2% expected.

EUR: BULLISH
Flash GDP for Q1 missed expectations at 0.5% q/q versus expectations of 0.6%, and at 1.5% y/y versus expectations of 1.6%. Inflation data for April has pushed the Eurozone back into deflation. CPI y/y printed at -0.2% versus expectations of -0.1%, and Core CPI printed at 0.8%, below expectations of 0.9%.

GBP: BEARISH
The May 12 BoE meeting provided little new information, with the Bank recognising risks from Brexit but maintaining their base case scenario is to stay in the EU. Market expectations regarding the UK’s EU referendum remain the primary driver of price action. Preliminary GDP for Q1 printed at 0.4% q/q as expected, however GDP y/y slightly beat expectations at 2.1% vs 2.0% expected. Average Weekly Earnings for February increased by 1.8%, below expectations of 2.3%, Claimant Count Change also missed expectations, increasing by 6,700 vs an expected decrease of 11,300. For the month of March, Core CPI m/m printed at 0.6%, double the expected 0.3%, and core y/y printed at 1.5% above expectations of 1.3%. Headline CPI also beat market expectations at 0.4% m/m and 0.5% y/y.

AUD: BEARISH
The RBA’s Statement on Monetary Policy cut inflation forecasts, cementing the chance of future rate cuts. RBA cut the OCR to a new low of 1.75% on May 3. The Bank had clearly signalled their intention to do so in the prior decision statements, if inflation moved lower. CPI for Q1 missed by a wide margin with Trimmed Mean CPI printing at 1.7% y/y, below expectation of 2.0%.

NZD: BULLISH
The FSR showed concerns over rising house prices but failed to introduce any new macroprudential controls, which suggests the RBNZ will remain on hold in June. Q1 employment was mixed with the jobless rate rising to 5.7% but job growth smashing estimates at 1.2% q/q. The market expects another rate cut in June with approximately 70% probability. The RBNZ kept rates on hold at the April 28 meeting, but maintain a strong easing bias which suggests another cut at the June meeting. CPI for Q1 slightly beat estimates at 0.2% q/q versus expectations of 0.1%. Year-over-year CPI matched estimates at 0.4%, well below the RBNZ’s target mid-point of 2%. Excluding petrol prices, CPI rose 0.7% y/y.

CAD: BULLISH
A neutral to weakly-bullish currency, with sentiment in lock-step with WTI. Core CPI for the month of March rose 0.7% versus an expectation of 0.3%. This puts year-over-year core inflation at 2.1%. Retail Sales Excluding Automobiles rose 0.2% for February, well above the expected half-percent decline. Solid data from Canada during April has erased any expectation of easing this year, for now.

JPY: BEARISH
The BoJ kept policy unchanged at the April 28 meeting, which saw massive strength in yen across the board, given the market pricing for a potential announcement of further easing. The BoJ may ease further at the next meeting on June 16. Tokyo CPI Ex-Food & Energy for April was at 0.6% y/y. The BoJ measure of National Core CPI remained steady in at 1.1% y/y for March.

CHF: BEARISH
CPI beat estimates for April, printing at 0.3% m/m, above the 0.1% expected. Fundamentally a weak currency, highly correlated with moves in EUR. The franc is fundamentally a weak currency given the SNB’s negative interest rates, however it can suddenly rally on safe-haven flows. The SNB regularly recite that the franc is overvalued and they are prepared to intervene to weaken the currency. The franc’s direction is difficult to predict due to regular intervention by the SNB.

(Source : http://www.jarrattdavis.com/currency-update-16th-may/)

 

 

25/4/16-29/4/16 EDR Risk Events

Economic Data Release (EDR) Risk Events of the week

Monday (25/4/16)
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Nothing important

Tuesday (26/4/16)
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(1) US Core Durable Goods
(2) CAD _ BOC Governor Poloz speaking

Wednesday  (27/4/16)
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(1) AUD quarterly CPI – 3 months once.
RBA entire monetary policy bias hinges on this data release.
RBA wishes to leave option open for further easing.
If inflation moves lower –> RBA will cut rate later on this year.
If CPI down big –> RBA will cut sooner. If CPI Down a little –> RBA will cut later on this year.
Trimmed Mean CPI y/y is the key figure estimate = 2.0%. Previous = 2.3%.
1.8%-1.9% = Miss –> RBA will cut rate in next 2-3 meetings. AUD will gradually move down.
<1.7% = Big Miss –> RBA may cut rate in next meeting. AUD will go down big immediately.
2.0%-2.2% –> RBA do not need to cut rate now. AUD will not be affected.
>2.2% –> RBA will not cut rate. AUD will go up.
All 4 scenario depends on this week trend of AUD prior to the CPI data release, to see how much data sentiment has been priced into the chart.

(2) FOMC Statement – No expectation to change rate at this meeting. Only 1 hike in june meeting is now priced into the chart. If Yellen is hawkish the hike will be sooner in May meeting, USD will up. If dovish hike will be later –> USD will down.Inflation expectation has moved lower.

(3) GBP GDP q/q – Overshadowed by Brexit polls. GDP release will need to be read in the context of the polls.

(4) RBNZ statement – 30% chance RBNZ will cut rate. Plenty room to cut rate. Inflation is now 0.7%, thus inflation is not on target. But Auckland property market is now heating up, thus rate cut will stimulate property bubble. Thus RBNZ is reluctant to cut rate, unless the inflation data is bad. RBNZ dovish statement will have short term move of NZD to upside.

Thurs (28/4/16)
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(1) BOJ Core CPI – BOJ has own measure of core CPI, they have wanted inflation to move higher. Yen has appreciated a lot.

CPI y/y estimate = 1.2%. Previous = 1.1%.
CPI >= 1.2% –> No easing –> JPY will go up slightly or stay constant.
CPI > 1.1% – 1.2% –> BOJ may ease later –> JPY will down slightly
CPI < 1.0% –> BOJ may ease sooner –> JPY will down big

Friday (29/4/16)
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(1)EUR core CPI Flash Estimate y/y –> 0.9% estimate. 1.0% previous.

(2) CAD GDP m/m

(3) USD Core PCE Price Index m/m –> estimate = 0.1%. Previous 1.0%.

 

 

 

7/4/16 Bond & Equity mkts analysis (updated)

On 31/3/2016, my blog post analysed relationship between Bond, Equity markets, Gold, Oil, and make a deduction that global equity markets MAY come down.

This is happening now.

This post will be update of the previous blog.

30years US Treasury Note

US30_7-4-16_Daily
US 30yr bond already broke downtrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend may reverse to uptrend from now on.

10years US Treasury Note

US10_7-4-16_Daily.jpg
US 10yr bond already broke downtrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend may reverse to uptrend from now on.

5years US Treasury Note

US5_7-4-16_Daily
US 5yr bond already broke downtrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend may reverse to uptrend from now on.

2years US Treasury Note

US2_7-4-16_Daily.jpg
US 2yr bond already broke downtrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend may reverse to uptrend from now on.

10years UK Treasury Note

UK10_7-4-16_Daily.jpg
UK 10yr bond already broke downtrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend may reverse to uptrend from now on.

S&P500 Daily Chart

ES_7-4-16_Daily.jpg
US Equity Index S&P500 still holding uptrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. But US Equity still intact. There is a chance of going down soon.

Dow Jones Daily Chart

YM_7-4-16_Daily.jpg
US Equity Index Dow Jones 30 still holding uptrend channel that started since 11/2/2016. But there is a slight crack to the down side. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. But US Equity still intact. There is a chance of going down soon.

Nasdaq Daily Chart

NQ_7-4-16_Daily.jpg
US Equity Index Nasdaq100 still holding uptrend channel that started since 11/2/2016. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. But US Equity still intact. There is a chance of going down soon.

UK Equity FTSE Daily Chart

FTSE_7-4-16_Daily.jpg
UK Equity Index FTSE100 still holding uptrend channel that started since 11/2/2016. There is a current break of uptrend channel. However the index price still looks bullish. On 15/3/2016, the bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. But UK Equity Mkt still look intact. There is a chance of going down soon.

Euro Stoxx50 Index Day chart

EuroStoxx50_7-4-16_Daily.jpg

Euro Stoxx 50 holding uptrend channel that started since 11/2/2016. At 15/3/2016, there is a current break of uptrend channel, and European Index has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on.  EU Stoxx50 Index reversed to downtrend at the same time.

Japan Nikkei 225 Index Day chart

JP_7-4-16_Daily.jpg

Japan Equity Index Nikkei 225 holding uptrend channel that started since 11/2/2016. At 15/3/2016, there is a current break of uptrend channel, and Nikkei has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Japan Equity market reversed to downtrend at the same time.

Hong Kong Equity Index – Hang Seng Index Day chart

HSI_7-4-16_Daily.jpg

Hang Seng Index holding uptrend channel that started since 11/2/2016. At 24/3/2016, there is a current break of uptrend channel, and Nikkei has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. HK Equity market may reverse down from now onwards.

Singapore – STI Index Day chart

STI_7-4-16_Daily.jpg

STI Index holding uptrend channel that started since 11/2/2016. At 15/3/2016, there is a current break of uptrend channel, and STI has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Sg Equity market may reverse down from now onwards.

Copper Futures Day chart

Copper_7-4-16_Daily.jpg

Copper holding uptrend channel that started since 11/2/2016. At 15/3/2016, there is a current break of uptrend channel, and Copper has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Copper market may reverse down from now onwards.

Gold Futures Day chart

Gold_7-4-16_Daily.jpg

Gold holding uptrend channel that started since 11/2/2016. At 15/3/2016, there is a current break of uptrend channel, and Gold has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Gold market may reverse down from now onwards. Gold has inverse relationship with USD. Thus if Gold comes down, USD will go up.

Silver Futures Day chart

Silver_7-4-16_Daily.jpg

Silver holding uptrend channel that started since 11/2/2016. At 17/3/2016, there is a current break of uptrend channel, and Gold has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Silver market may reverse down from now onwards. Gold has inverse relationship with USD. Thus if Silver comes down, USD may go up.

Crude WTI Futures Day chart

Crude_WTI_7-4-16_Daily.jpg

Crude holding uptrend channel that started since 11/2/2016. At 17/3/2016, there is a current break of uptrend channel, and Gold has turn bearish. On 15/3/2016, the US bond price already started going up, and now is confirmed broke down channel. Trend of Bonds may reverse to uptrend from now on. Crude market may reverse down from now onwards. Crude has +ve correlation with US Equity Market. Thus Crude may bring US Equity indices down.

Implications

Bond : UP
Equity : DOWN
Oil : DOWN
Metal : DOWN