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  • Finance 0

    VIX Options Volume Hits Record High As Equity Correlation Flashes Red

    Traders bought and sold an all-time record high 3.15 million VIX options on Friday (as ‘elephants’ and ’50cent’ re-emerged) amid the Ross Rout and North Korean shenanigans. But as that volume explodes through the derivaties market, risk and the underlying have notably decoupled… Several explanations are plausible: 1) a cautious, pessimstic one – demand for downside protection picking up as stocks go parabolically higher; or 2) an optimistic balls-to-the-wall scenario where demand for calls surges as what’s better than being long stocks… being long stocks levered! In fact, this regime shif...
    On December 4, 2017 / By
  • Finance 0

    Stocks And Precious Metals Charts – Hard Times Killing Floor Blues

    Stocks rallied hard on the open based on the Senate passing the GOP ‘tax reform’ bill. I put that in parentheses because it is no reform, not in the least.It is the continuation of a process that has been taking place at least for the last thirty years or so.It is the transfer of income and wealth from the broad populace to the most powerful and wealthy few.The evidence is in the record inequality of wealth in the US. Have no part in any of this.It is the way of a culture of death.And it will ensnare many. Stand firm, and do not let your love grow cold.If you are confused by so many contrary lies presented with high sounding words...
    On December 4, 2017 / By
  • Finance 0

    World Markets Update – Monday, December 4

    All eight indexes on our world watch list have posted gains for 2017 through December 4. The top performer thus far is Hong Kong’s Hang Seng with a gain of 32.44%, followed by India’s BSE SENSEX at 23.59%. In third is Tokyo’s Nikkei with 18.80%. The Last Four Weeks The tables below provide a concise overview of performance comparisons over the last four weeks for these eight major indexes. We’ve also included the average for each week so that we can evaluate the performance of a specific index relative to the overall mean and better understand weekly volatility. The colors for each index name help us visualize the comp...
    On December 4, 2017 / By
  • Finance 0

    Market Talk – Monday, December 4

    Asian markets were unsure how to respond to the weekend news of the US tax move. Whilst it was assumed the move was positive news for US futures markets, it is not necessarily good news for its competitors. The realisation that cash is now being beckoned by US markets, others realise they will be forced to respond quickly. The Hang Seng and Shanghai off-set one another, but we will have additional significant news events published this week. The Nikkei lost 0.5% reflecting the uncertainty and also saw renewed Yen demand having rejected the 113 level. Much of the talk surrounded US tax and expected cash markets reaction and also the meeting la...
    On December 4, 2017 / By
  • Finance 0

    Bullish Trade Setups Should This Rally Continue

    Bullish trade setups to start December Friday stunk with ABC’s erroneous news report that dropped the Dow nearly 400 points in just a few minutes, and then today you had the huge gap higher, which gave everyone warm and fuzzy feelings all around, only to see the market sell off the hype and in particular the tech sector.  So for me it is a less than ideal start to the month. That’s fine, I’ve had less than stellar starts before, and this one is no different. You continue to manage the risk, and let the market take you where it wants to. I’ll admit though, having to deal with false market news, doesn’t make thing...
    On December 4, 2017 / By
  • Finance 0

    Brexit Talks Halt Rise In 6B

      As spot forex traders we often neglect to consider the futures market for a view on market sentiment, which is a great shame because often the futures market can be ahead of the curve, and given the importance of this week for the Brexit negotiations now may be a good time to see what the charts for the 6B are signaling. The 6B is, of course, the futures contract for the British pound. And today daily chart looks as though it may close the session as a doji candle on high volume, and contrary to what many traders believe the doji is not a reversal candle, but instead is one of indecision. And whilst a market may reverse on the subsequent c...
    On December 4, 2017 / By
  • Finance 0

    Manufacturing ISM Report Shows Deceleration

    Italian Election Sees Surge In Right Wing Populism With the Italian election coming in March, we’ve discussed how a win by an unstable political party could be particularly harmful to Italian bonds because the ECB will be cutting its bond buying in half. Since the last time we’ve check on Italian politics, the trend towards populism and Euroscepticism has continued. This is surprising because the economy has had a decent year. Usually you’d expect descent when the economy is weak. One can only wonder what will happen if a recession occurs. Goldman is predicting weakness in the Italian economy next year, which might fuel populism further...
    On December 4, 2017 / By
  • Finance 0

    Transitory?

    The FOMC is holding its next regular policy meeting next week. It is widely expected that on December 13 the Federal Reserve’s policy body will vote and publicize the next “rate hike” in its exit strategy. Starting in December 2015, this next one, if it happens, will be the fifth in the series. It would bring the IOER “ceiling” (or the first of the double floor, as some policymakers try to call it for making it sound like IOER hasn’t been a complete failure from the very start) to 1.50%. In all likelihood the RRP “floor” floor will be raised to 1.25%. Money market rates typically adjust in anticipation, which is what all cent...
    On December 4, 2017 / By
  • Finance 0

    AUD/USD Pre RBA Levels

    The Australian dollar will be in focus tonight with PMIs, retail sales and the Reserve Bank of Australia’s monetary policy announcement on the calendar. We are looking for slightly stronger data and unchanged policy guidance but that may not do much for the currency. Taking a look at how Australia’s economy performed since the last meeting, first and foremost, there were fewer than usual economic reports released between monetary policy announcements. Retail sales, the trade balance and Q3 GDP for example won’t be shared until the day of or after the RBA rate decision. Since the November meeting, consumer confidence has fallen, inflatio...
    On December 4, 2017 / By
  • Finance 0

    Senate Passes Tax Bill: 5 ETFs To Buy Now

    Trump scored a first major legislative win after more than 10 months in office following the Senate’s approval of the biggest U.S. tax overhaul in three decades “Tax Cuts and Jobs Act,” with a 51-49 vote. The move has brought Republicans closer to finalizing the $1.5 trillion tax reform by the end of the year. The Senate bill differs from the tax bill passed by the House in mid-November on various fronts. We have highlighted some of the major differences: 1.  Both bills reduce the corporate tax rate from 35% to 20% while the House cuts it immediately, the Senate delays the cut till 2019. 2.  The House bill shrinks the current income...
    On December 4, 2017 / By