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Macro

Eurex: Fed In No Rush, But May Is


Morning Briefing March 21st 2018

In Europe the release of data on UK public sector finances and retail sales at 0930GMT will be closely watched.

Furthermore, the BOE and SNB will then announce their monetary policy decision at 1200GMT and 0830GMT, respectively. The highlights in the US are the publication of the Philadelphia Fed manufacturing index and the weekly jobless claims at 1230GMT.

Public sector net borrowing in the UK was GBP -15.8 BN in January and the MNI median expects an improvement to GBP -0.8 BN in February. The central government net cash requirement was GBP -25.8 BN in the previous month. In January retail Sales m/m grew by 1% whereas retail sales excluding fuel were growing by 1.2%. UK retail sales are expected to slow in February (-0.3% and -0.4%, respectively) after the positive January figures, as ongoing uncertainty over Brexit dampened shopping spirits -- although warmer than usual weather in the month could somewhat ease the slowdown.

The current interest rate in the UK is 0.75% and the main rate in Switzerland stands -0.75%. Both are expected to remain at their current levels. In the UK the current BOE asset purchase program amount is GBP 445 BN.

The Philadelphia Fed index is expected to rebound to a reading of 7.0 in March after falling to -4.1 in February. The Empire State index fell to 3.7 in March from 8.8 in February. The level of initial jobless claims is expected to fall by 4,000 to 225,000 in the March 16 employment survey week after an increase of 6,000 in the previous week.

The European Council meeting takes place in Brussels, with the UK's request for a Brexit delay likely to top the agenda. At 0800GMT ECB Supervisory Board Chair Andrea Enria speaks in Brussels and the ECB Economic Bulletin is released at 0900GMT.

Global Economic Trading Calendar

Markets

BOND SUMMARY: With Japanese markets closed for a national holiday and news feeds relatively quiet, focus in today's Asia-Pacific session fell on regional economic data. The latest Australian labour market report revealed that domestic unemployment fell to a multi-year low of 4.9% from the prev. 5.0% in February, amidst the RBA's particular concern with domestic labour mkt developments. - Aussie bond yields opened lower, seemingly playing catch up to the post-FOMC move in U.S. Tsys, but then jumped on the back of the aforementioned labour mkt report, before paring gains. Aussie bond yields are trading 0.3 to 4.6bp lower across the curve at writing. Worth mentioning the strong data print briefly pushed the 3-Year bond yield back above the RBA cash rate of 1.50%, before it eased off. YM last trades +0.5 tick at 98.565, XM +4.0 ticks at 98.100, with YM/XM 4.0 ticks lower at 46.00. Bills are trading 1-3 ticks lower through the reds. - T-Notes have stuck to a very tight range and last trade +0.01 at 123.14, with cash markets closed due to the Japanese holiday. Eurodollar contracts are trading 0.5 to 1.0 tick higher through the reds.

FOREX: The Antipodeans remained buoyant overnight, propped up by domestic data releases, even as moderation emerged as the dominant theme in the second part of the session. NZ Q4 GDP came out in the NY/Asia crossover, putting an early bid into the kiwi, as Q4 economic growth accelerated to +0.6% Q/Q, meeting market exp. and proving strong enough to cap worries that the RBNZ might deliver a cut to its OCR in 2019 (although Y/Y growth missed exp.). Elsewhere, Australian unemployment rate fell to an 8-year low of 4.9%, with the RBA closely watching domestic labour mkt developments. Worth noting participation rate ticked lower. - The greenback underperformed, in a carryover from its yesterday's post-FOMC weakness, but moved away from worst levels. - USD/CNH hit lows not seen since mid-July before paring most of the losses. - JPY showed some early weakness, but shook it off gradually, with Japanese markets closed for a national holiday today. - MonPol decisions from the BoE, Norges Bank and SNB, as well as UK PM May's trip to Brussels for a key summit with fellow EU leaders, take focus today. Elsewhere, ECB's Enria will speak, while the ECB will publish its econ bulletin.

Technical Analysis

BUND TECHS: (M9) MARCH 8/12 HIGHS IN FOCUS

After trading below the 21-dma on Tuesday, Bund futures failed to close below this key level before the dovish FOMC Staff Economic Projections saw Bund futures break higher above this week’s trading range. Focus will now be on the Mar 8/12 highs at 164.74. Above here would reignite upside momentum and open the Feb highs on the continuation chart. Bears target initially need to break back below the 21-dma at 163.84 before challenging Tuesday's low at 163.63 with a break below here opening the March 7 low at 163.43 ahead of the March 5 low and 50-dma.

EUROSTOXX50: PARING SOME GAINS

After trading through the 150% retracement from 2908.70-3244.98 at 3213.12 on Tuesday, Eurostoxx pared some of its gains yesterday, closing back in line with the 138.2% retracement which comes in at 3373.44. Bulls need to close above 3400 again to shift the focus to the Sep 27 high at 3452.41. Above here would open the July 31 high at 3536.89. Bears look to close below uptrend support which comes in at

Eurex Futures Market Close

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MNI subscribers make critical decisions with deeper insight and greater confidence. Pinpoint information and market-moving interviews let them react instantly to market changes and more importantly, anticipate future market moves. MNI reporters are market professionals in the news business. They work like journalists but think like traders. When interviewing Fed officials, our reporters ask the same questions you would ask. They cover the angles you would cover. Write the way you read.

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This article is from Eurex Exchange and is being posted with Eurex Exchange’s permission. The views expressed in this article are solely those of the author and/or Eurex Exchange and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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Technical Analysis

AUDUSD Testing Weekly Chart Downchannel Resistance


The AUDUSD powered ahead in today's Asia morning on the back of the FOMC, but after surging roughly 100 pips from yesterday's lowest point to current levels, is vulnerable to healthy profittaking today.  Significantly, the AUDUSD is bumping up against upchannel resistance (on the 4hr chart), triangle resistance (on the daily chart) and weekly downchannel resistance (on the weekly chart).  Bulls will increasingly buy on dips as a breakout above the next whole figure level of .7200 will be seen by many as marking the end of the year plus downtrend.  The weekly, daily and 4hr RSI, Stochastics and MACD are bottomish or rallying.  I am looking at entering long in the green zone (of the daily chart), targeting the red zone for Tuesday.  The amber/yellow zone is where I might place a stop if I was a swing trader (although in my personal account with which I seldom hold overnight I sometimes set my stops tighter).

 

AUDUSD Weekly/Daily/4hr

Click here for today's technical analysis on EURUSD, Silver

 

As seen on Bloomberg, Refinitiv (Thomson Reuters), Factset, Interactive Brokers, Inside Futures, Amazon, Liquid (Quoine) and Zerohedge, Tradable Patterns was launched to demonstrate that the patterns recurring in liquid futures, spot FX and cryptocurrency markets can be analyzed to enhance trading performance. Tradable Patterns’ daily newsletter provides technical analysis on a subset of three CME/ICE/ (commodities and equity indices) and spot FX markets, which it considers worth monitoring for the day/week for trend reversal or continuation. Crypto Weekly Outlook offers technical analysis on Bitcoin (BTCUSD), Ethereum (ETHUSD) and Ripple (XRPUSD) and attempts to provide clues as to what might happen in the coming week.  For less experienced traders, tutorials and workshops are offered online and throughout Southeast Asia.

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This article is from Tradable Patterns and is being posted with Tradable Patterns’ permission. The views expressed in this article are solely those of the author and/or Tradable Patterns and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


23245




Futures

FX Rundown - Blue Line Futures (03.20.19)


 

Today, the Federal Reserve projected no hikes in 2018 and announced their plan to finish QT by September. The SNB and BoE are up next tomorrow morning. We cover the landscape and levels for the Dollar, Euro, Yen, Aussie and Canadian. 

 

Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.

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Prior to Blue Line, Bill was the Chief Market Strategist at iiTRADER which followed running a trade desk at Lind Waldock and MF Global.

Bill is a featured expert on CNBC, Bloomberg and the Wall Street Journal as well as other top tier publications. 

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Futures are not suitable for all investors. The amount you may lose may be greater than your initial investment. Before trading futures, please read the CFTC Risk Disclosure. A copy and additional information are available at ibkr.com

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Blue Line Futures and is being posted with Blue Line Futures’ permission. The views expressed in this material are solely those of the author and/or Blue Line Futures and IBKR is not endorsing or recommending any investment or trading discussed in this material. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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Macro

Interactive Brokers - Asia-Pacific: The Week Ahead (Mar 25-Apr 1)


South Korea: Struggling to Get it Into Gear

South Korea is set to release a slew of new economic updates in the week ahead, including consumer and business confidence, retail sales and an update on its slowing manufacturing sector.

South Korea’s economy has been battered recently, amid intensified risks from the U.S. Federal Reserve’s monetary policy normalization, as well as uncertainties over US-China trade talks.

Meanwhile, a somewhat slower pace of global economic growth has generally stymied the country’s exports, as well as its labor market and rate of inflation. In fact, South Korea’s consumer price index (CPI) has slowed to the upper-0% range, mainly due to declines in the prices of petroleum products and agricultural goods, including livestock and fish.

Against this landscape, the Bank of Korea at its meeting in late February left its Base Rate unchanged at 1.75%.

 

 

The central bank also observed that South Korean domestic stock prices have generally risen on the back of optimism about the US-China trade dispute, while long-term market interest rates and the Korean won-US dollar exchange rate have fluctuated within narrow ranges.

To date, the iShares MSCI South Korea ETF has fallen roughly 17.8% year-on-year but has climbed nearly 10.6% from its 52-week low set in October 2018, according to the IBKR Trader Workstation. The Korean won has yet to recover from its June plunge and has lost more than 6.3% of its value against the U.S. dollar since its April 2018 high.  

 

 

Elsewhere, household lending in the nation has also continued to slow, amid more stringent mortgage loan standards under the recently adopted Debt Service Ratio (DSR) for new borrowers. South Korea’s housing prices have also fallen slightly.

However, the country is not alone in its struggles to revive growth.

Moody’s Investors Service analyst Christian Fang recently noted growth in the Asia-Pacific region is slowing and “further downside risks have intensified,” including US-China trade tensions, tightening global financing conditions, and shifting domestic political and policy priorities.

Fang said a “weaker economic outlook means that the window for addressing credit challenges is closing.” Furthermore, he added that “tensions between the US and China could disincentivize investment and weigh on growth potential beyond Moody's current assumptions, given trade exposure to China and the integration of manufacturing supply chains within APAC.”

Indeed, manufacturing activity in South Korea, Japan and China has been recently diving deeper into contraction territory.

Moody’s said Asia's emerging and frontier market economies are “likely to experience the sharpest deceleration in 2019, with likely median GDP growth rates of 5.5% and 5.2%, respectively.” Meanwhile, growth in the advanced economies will likely slow to 2.5%.

 

Calendar of Events

South Korea’s economic releases in the week ahead will kick off in earnest with:

Tuesday, March 26

  • Consumer Confidence (Mar)

 

Wednesday, March 27

  • Business Confidence (Mar)

 

South Korea’s Composite Consumer Sentiment Index (CCSI) registered 99.5 in February, up 2 points from the prior month, but far from its June 2018 level of 105.4. The country’s Business Survey Index (BSI) on conditions in the manufacturing sector also rose 2 points from the previous month to 69 in February, with the outlook for March having risen by 11 points to 76.

The Economic Sentiment Index (ESI) – a composite of the BSI and Consumer Survey Index (CSI) for February rose 5.8 points year-on-year to 95.1.  

In the latter part of the week, investors will receive reports on:

Thursday, March 28

  • Industrial Production (Feb)
  • Retail Sales (Feb)

 

Sunday, March 31

  • Trade Balance (Mar)
  • Nikkei Manufacturing PMI (Mar)

 

The headline Nikkei South Korea Manufacturing Purchasing Managers’ Index (PMI) fell to a 44-month low of 47.2 in February, from 48.3 in January, suggesting the sharpest deterioration in the health of South Korea’s goods-producing economy since June 2015 and extending the current period of decline to four months.

 

 

According to Nikkei and IHS Markit, the latest survey data highlighted “stronger declines in new orders from domestic and overseas markets in February, leading to sharper reductions of both output and staffing levels.”

Joe Hayes, economist at IHS Markit, noted that the latest PMI data indicates there is “no sign of recovery in South Korea’s manufacturing sector, with evidence that the struggling global trade cycle is pinching a key exporting market.

“International demand fell at the joint-sharpest pace in five-and-a-half years during February, with weak underlying conditions reportedly compounded by rising competitive pressures.”

Hayes added that for South Korea’s economy “to sustain its relatively robust growth path, the domestic economy will need to pick up the slack from overseas markets.”

Against this backdrop, coming off of the week-end investors will also get an update on South Korea’s flagging inflation rate, which slowed to 0.5% in February from 0.8% in the prior month.

 

Monday, April 1

  • CPI (Mar)

 

Market participants will be keeping an eye on South Korea’s manufacturing sector, as well as its CPI, for any further signs of a potential downturn.

In the meantime, select the Event Calendar option in the IBKR Trader Workstation for a full list of U.S. and global corporate events and earnings, dividend schedules, economic data, IPOs and more.

--

The author does not hold any positions in the financial instruments referenced in the materials provided.

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Futures are not suitable for all investors. The amount you may lose may be greater than your initial investment. Before trading futures, please read the CFTC Risk Disclosure. A copy and additional information are available at ibkr.com

The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


23241




Macro

Sentieo - Fed Statement Analysis - By Jed Gore


Jed Gore, senior data scientist at data analytics research firm Sentieo, analyzed the Fed Meeting Statement released Wednesday. His findings showed an even more significant decline in "hawkishness" than the statement discussed in IBKR’s U.S. Week Ahead segment Breaking the Fed Code.  “This is a significant result,” he said.

Gore added: “The results were somewhat predictable when we look at Chairman Powell's speeches over the past year (see bottom chart). 

“The last three speeches, all of which fell after the January meeting, were significantly more ‘dovish’ than previous long-form speeches,” after filtering out some of the shorter instances of him talking at dinners and such and restricting the analysis only to major long-form talks.

 

--

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Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from Sentieo and is being posted with Sentieo’s permission. The views expressed in this material are solely those of the author and/or Sentieo and IBKR is not endorsing or recommending any investment or trading discussed in the material. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IBKR to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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1 2 3 4 5 2 2023

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