I was mad at myself for not exiting my long Eurostoxx position into Barron’s bullish cover article (Too Busy Patting Myself on the Back). At that point, we had hit maximum European enthusiasm, and the next move was bound to disappoint. And although it has barely been two weeks since I wrote that piece, I am now returning to the long side of the Eurostoxx market. Let me tell you why. Since then, the German Bund market has broken down. Yields have risen from 25 basis points to 55 bps in the past couple of weeks. The good news is that yields are rising for the right reasons. The economy is doing better, the quantitative easing program is bein...
Well, a full week is upon us, and we enter a period in which we don’t have any damned holidays to interrupt our trading until September rolls around. Looking at the ES, the topping formation is still in the throes of completion. Simply stated, the steady series of lower lows and lower highs must not be violated, and the gentle downtrend illustrated with the red trendline needs to keep drifting toward that much longer-term blue supporting line and break it. If we can do that, it’s party time. The line in the sand at 2417.50 is still important, and I’ll breath easier if we can get to the lower side of it. As for the Nasdaq, as I...
Believe it or not the globe is headed for an oil shortage. I know many find that hard to believe, especially in this shale crazed world where there is the belief that shale oil will fill all voids, even as investment in oil exploration falls to the lowest level since the 1940s. I am not the only one thinking this way. Dow Jones reported Amin Nasser, the chief executive of Saudi Arabian Oil Co. or Saudi Aramco, is predicting that the world is heading for an oil-supply shortage that booming U.S. shale production can’t prevent. He pointed out that in the past three years there has been a major reduction in investments in long-term crude-pe...
EUR/USD The EUR/USD pair spent most of the day on Friday chopping around as the job numbers came out of America, much better than expected. We did bounce from below the 1.14 handle, so that’s a very bullish sign. The candle looks as if the buyers are getting ready to come back in and try to push towards the 1.15 handle, and more importantly the weekly candle is a hammer as well. Because of this, I think the dips will continue to be buying opportunities but I recognize that the 1.15 level above is massive resistance as it has been the top of consolidation for the last 3 years. Ultimately, I believe that the buyers are in control and it’s o...
The credit market has largely ignored the sovereign yield back-up. If the great crack-up is here, you’re going to need to see it in credit, too. Stay tuned That’s from former FX trader Richard Breslow and it’s an important point. For quite some time, analysts and the commentators who know what they’re talking about have observed that if you had to pick one asset class that’s been the most Teflon in a universe of seemingly bulletproof assets, credit would be a good candidate. Both IG and HY have shrugged off virtually everything that’s been thrown at them. The ranges have been so narrow that if you look at history, 2017 has been...
OVERNIGHT MARKETS AND NEWS Sep E-mini S&Ps (ESU17 +0.02%) this morning are up +0.12% and European stocks are up +0.42%. Strength in technology stocks is leading the overall market higher with Advanced Micro Devices and Nvidia both up over 1% in pre-market trading. European stocks also received a boost on stronger-than-expected German May exports and stronger-than-expected Eurozone Jul Sentix investor confidence. Weakness in mining companies and energy stocks limited the upside in stock index with Aug COMEX gold (GCQ17 -0.16%) down -0.17% to a 3-3/4 month low and Aug WTI crude oil (CLQ17 -0.99%) down -1.18% to a 1-week low. Asian stocks se...
In his latest weekly letter to clients, One River CIO Eric Peters shifts his attention away from his two favorite topics of monetary policy and capital markets, to unveil a streak of contrarian skepticism on the topic of “technological disruption”, and in his trademark anecdotal style, present a hypothesis that would be most unwelcome in virtually every Econ 101 class and Venture Capitalist Headquarters: stating that “we should be careful not to overlook the possibility that today’s disruptive technology companies may be not much more than mechanisms to drive wages down to subsistence levels” alleging that “these compa...
Nothing seems to matter. Trump’s appearance at the G20 meeting this weekend was universally reviled as one of the worst foreign policy disasters since Chameberlain met with Hitler yet there’s no indication if it in the Futures as we seem to be holding Friday’s pumped-up, low-volume gains – so far. ABC’s political editor, Chris Uhlmann delivered a scathing analysis of Donald Trump’s presidency during the G20 summit, accusing him of hastening America’s decline as a global superpower and criticised Trump’s presence at the summit in Hamburg, his leadership and use of Twitter, saying his actions in diminishing...
Video length: 00:10:55 After a superficially good, but in reality, an overall mixed June US labor market report on Friday, the US Dollar finds itself posting small gains for the second day in a row as it kicks off an important week. Through the first half of the year, everything that could go wrong for the greenback seemingly went wrong: no movement on fiscal policy; the market losing faith in the Fed to raise rates; and lackluster economic performance generally. As such, the DXY Index is still near its yearly lows. This week could mark the beginning of the turnaround for the US Dollar, however. With no expectations for any fiscal stimulus th...