On Monday in “These Charts Do Not Scream ‘Ready For A Super Aggressive Fed’“, we warned that a fairly rapid repricing higher of yields is being met with price action that suggests markets aren’t prepared to digest an overly hawkish message. Commodities are in free fall, HY spreads are widening, IG is selling off now too, and the stock-bond return correlation is becoming less negative, triggering an unwind in risk parity. (Goldman) The takeaway: while a March hike might be seen as confirmatory evidence of the reflation meme’s viability, any indication that the Fed is set to materially alter the expected trajectory of future normali...
A OPEC snow job. What is Saudi Production? Oil prices thwarted a early morning recovery on a private report that put Saudi oil production above 10 million barrels a day. Not so according to the Official OPEC data that said that said its production decreased 139,500 barrels a day in February, to average 31.96 million barrels a day with Saudi Arabia cutting 68,100 barrels a day to 9.8 million barrels a day. But traders think the numbers are a snow job. The big March snowstorm that is going to bury the northeast, as well as cold and snow in the mid-west, is already having an impact on a lot of different markets in a lot of different ways. We saw...
US businesses added 235k workers to the payrolls in the month of February, which was more than the forecasts of 200k, official data from the U.S. Bureau of Labor Statistics showed on Friday. The U.S. unemployment rate fell from 4.8% to 4.7% in February as widely expected, but the pace of the average hourly earnings grew 0.2%, less than forecast. The February payrolls report removed all remaining doubts for a rate hike from the Federal Reserve this week, which is all set to bring the U.S. short-term interest rates 0.75% – 1.00%. The February payrolls report covered one full month under the Trump presidency. Obviously, President Trump too...
The Euro continues to come under pressure as a result of political uncertainty in upcoming elections in France and the Netherlands. Investors are worried about surprise outcomes, especially given the events in the UK and the US which brought us a Brexit and Trump presidency. Investors are also wary of a dovish European Central Bank which is expected to begin tapering its QE program soon, and recent comments from officials of the ECB add to cautious sentiment. As reported at 9:54 am (GMT) in London, the EUR/USD was trading at $1.0642, down 0.09%; the pair earlier hit a low of $1.0633, while the peak was set at $1.0662. The EUR/GBP was higher a...
The markets have traded in a tight range during the Asian session but Europe has started with a bang. GBP/USD is already trading 100 pips lower than 2 hours ago on speculation that the imminent Article 50. However, Scotland is looking for a new independence vote in 2018 or 2019. Hence, the pressure for a weaker Pound is expected to persist for now. GBP/USD traded as low as 1.2123, a 1- month low, after having posted 1.2250 highs yesterday. US equities ended mixed overnight with Dow Jones closing down -22.5 pts, or -0.1% at 20881.48. S&P 500, on the other hand, gained 0.87 pts, or 0.04%, to close at 2373.47. This comes ahead of ahead of...
Overt obstacles obviously overlooked overarching technical behavior; as you know leaving the market pundits either confused or groveling, for some sort of an ‘explanation’ as to why the market fails to accommodate their very aggressive calls for decline, or even carnage; none of which is happening. Here that’s no surprise despite our own recognition that a correction should be out there, but as I’m prone to say: ‘just not quite yet’. In the past week, to me it was pretty clear the ‘odds’ favored stability or even upside, for a single basic reason: declines were attempted but got nowhere on the d...
There were so many oil stocks on the list this week that I put the cut off at 15 million shares (just for oil stocks) to help filter it down. Fairmount Santrol Holdings (FMSA) Average day range (30) is 6.54% and average volume (30) is 5 million. Cliffs Natural Resources (CLF) Average day range (30) is 6.04% and average volume (30) is 26.6million. Oclaro (OCLR) Average day range (30) is 5.48% and average volume (30) is 10 million. Community Health Systems (CYH) Average day range (30) is 5.48% and average volume (30) is 4.6 million. Dynergy (DYN) Average day range (30) is 5.42% and average volume (30) is 3.4 million. Coeur Mining (CDE) Average...
European stocks declined for first session in five ahead of Wednesday’s Dutch elections, debt ceiling expiration and the conclusion of the Fed’s 2-day meeting where it is expected to raise rates by 25 bps. Tightening concerns emerged, also dragging down Asian shares and S&P futures, while the dollar continued its rise for a second day. Crude oil has ended its six-day drop. The pound tumbled 0.8% to the lowest since mid-January in a delayed reaction after Theresa May won permission to trigger the country’s departure from the EU. On today’s US calendar, we get the Producer Price Index although most NYC-based traders are ...
The UK Claimant Count Change measures the change in the number of people claiming unemployment benefits. It provides a snapshot of the UK employment situation and could affect the direction of GDP/USD. Here are the details and 5 possible outcomes for GBP/USD Published on Wednesday at 9:30 GMT. Indicator Background UK Claimant Count Change is closely monitored, as the indicator is one of the most important economic indicators. A reading which is lower than the market forecast is bullish for the pound. The indicator sparkled in January, as jobless rolls dropped by 42.4 thousand. This crushed the estimate of a gain of 1.1 thousand. Anot...
Previous: Trading on the euro on Monday closed down. The EUR/USD rate fell from a maximum of 1.0714 to 1.0651 (-63 pips). The economic calendar was empty and the euro underwent a correction across the market after Friday’s rally. Market expectations: On Tuesday, the FOMC’s two-day meeting begins. On Wednesday, the Federal Reserve will announce its interest rate decision. Most are expecting a 0.25% hike in federal interest rates. The likelihood of a rate hike currently stands at 93%. The meeting will be followed by a press conference with the Chair of the Board of Governors, Janet Yellen. The EUR/USD instrument is currently trading...