Trading with point and figure

Moneylender said:
F2 I agree with what you say but I try and look for as many contact areas of the S n R levels in order to assertain their strength or not mand the project them through to the current time.
Red trend, agreed its far too weak but its where the new down boxes start.

doesnt always work but its the way I prefer.
Click to expand...

OK no problems, maybe it would be better to use boxes/blocks for s/r areas when it's not a clear cut s/r line?
 
** Please note that I will not be in the office on Thursday & Friday, and there will be no updates **


- Fed meeting in focus on busy day for statistics, as China activity
indicators digested ahead of UK labour data, US CPI & Retail Sales;
bond auctions aplenty in Europe; EIA oil inventories and IEA monthly
oil market report also due

- China: on balance slightly better than expected, Retail Sales
encouraging given drag from autos; Industrial Production leans against
signal from Manufacturing PMI

- UK labour data: earnings in focus after higher than forecast CPI;
Employment growth expected to post further solid gain

- US CPI: energy and food seen weighing on headline, healthcare costs
the wild card; core inflation to be paced as ever by housing costs

- US Retail Sales: headline to see headwind from weak auto sales and lower
gasoline prices, core measures to post further solid gain

- FOMC: rate hike discounted, focus on dot plot, economic forecasts and
balance sheet reduction plans; financial conditions may dictate less
dovish tone than many expecting

..........................................................................

********************
** EVENTS PREVIEW **
********************

So the much anticipated Fed meeting has finally arrived, though that is far from the only item on the day's agenda. A hefty day for major statistics has China's Retail Sales, Industrial Production and Fixed Assets Investments and India WPI to digest ahead of UK labour and wages data and US CPI, Retail Sales and Business Inventories. On the bond auction front, it will be a busy day in Europe with Sales in Germany, Portugal, Norway and Sweden. EIA weekly oil inventories follow an unexpected rise in the API crude and gasoline stocks measures, while the IEA publishes its monthly Oil Market Report. The run of Chinese statistics underlined that while Manufacturing PMIs weakened in My, this was probably a function of poor seasonal adjustment, given the relative frequency of this happening at this time of the year, and the fact that Industrial Production posted a modestly stronger than expected and unchanged from April 6.5% y/y, with weak oil sector output countered by a surge in the coal industry. Retail Sales were also slightly better than expected at an unchanged 10.7% y/y, which is encouraging given the documented weakness in Auto Sales, while a slower pace of Fixed Asset Investment 8.6% y/y was unsurprising given the deceleration in Property Investment, with Private Sector FAI posting a little changed 6.8% y/y, thus sustaining the recovery from H2 2016 weakness.

** U.K. - April/May Labour data **
- After the much stronger than expected CPI data (higher than expected for all the items previously noted - Utilities, Food, Clothing & Footwear, Recreation & Culture), the focus today will primarily be on Average Weekly Earnings, where the headline measure is seen unchanged at 2.4% y/y, thus implying inflation adjusted earnings dropping further to -0.5% y/y, which if correct will be the headline grabber, though also underline that the BoE will see this as justifying their current on hold policy stance. That said, some attention will also need to be given to the FLS Employment measure, which showed a much sharper than expected 122K in the Q1, which is expected to have been sustained, and is unsurprising given that Vacancies are close to their cyclical high, though that also underlines that there is a clear skills shortage given that the Unemployment Rate remains very low at 4.6% (very close to the BoE's NAIRU assumption of 4.5%).

** U.S.A. - FOMC rate decision **
- While there are a sizeable minority of market participants who doubt that the Fed will hike rates today, and a majority that believe that if they do, it will be the last hike in 2017, a 25 bps hike is fully discounted, see http://www.cmegroup.com/trading/interest-rates/countdown-to-fomc.html . Thus the key focal points for today are likely to be: a) any changes in the 'dot plot', particularly given market doubts about a further 2017 Fed rate hike, with the usual caveat that this is a median, and therefore one shift higher or lower can shift the trajectory, and it is as important to watch for divergence and convergence. b) How the Fed tweaks its economic forecasts, above all its inflation forecasts and its long-term equilibrium Unemployment Rate, which may send differing signals. c) Updates on how and when it will start to reduce the size of its balance sheet, particularly as even the more dovish members (e.g. Bullard) want to see the 'wheels set in motion on this', perhaps mistakenly believing that it will have only a minimal impact long-term interest rates, at least in the short-term. It should also be noted that one key measure that the FOMC looks at is Financial Market Conditions, which have eased considerably in the past 3 months as bond yields have fallen, credit spreads have tightened and equity markets rallied, this above all may prompt a less dovish tone than markets appears to be expecting.

** U.S.A. - May CPI & Retail Sales **
- The weaker trend in both CPI and PCE deflators in recent months has probably been rather over-discussed, and has certainly not been indicative of a fresh bout of marked disinflation. Today's CPI are expected to see energy prices, and to a lesser extent food prices drag on the headline, with the consensus looking for a flat m/m reading for 2.1% y/y (April 2.2%), while core CPI is seen up the 'usual' 0.2% m/m for an unchanged 1.9% y/y, paced as ever by shelter (OER) costs, with healthcare base effects also acting as a drag in y/y terms. Yesterday's higher than expected PPI would suggest that the risks are fractionally to the upside in core terms, though the two series are not that well correlated on a month to month basis. Retail Sales are expected to post a very modest 0.1% m/m increase after rebounding by 0.4% m/m in April, with Auto Sales once again making little contribution and lower gasoline prices weighing on sales, core measures are expected to be rather better, with the ex-Autos & Gasoline measure seen up 0.3% m/m. Overall this would point to a respectable pick-up in Personal Consumption in Q2 from Q1's sluggish 0.6%, but still well off the pace seen in H2 2016.


from Marc Ostwald
 
dentist007 said:
dow....bears still gettin toasted

2m6ucmc.png



breakout point/rez/aqua is 21276-21294 area#
there is a 1 box horizontal count target of 21384 area
Click to expand...
posted at 7.20am
 
You must log in or register to reply here.

Similar threads

Michael Carr
  • Article
Equities Technical Analysis Testing Point & Figure Patterns
Replies
0
Views
3K
T2W Bot
T2W Bot
S
Point&Figure
2
Replies
39
Views
7K
subarashi
S
M
Point and Figure
Replies
2
Views
1K
Dentalfloss
Dentalfloss
A
Point and Figure box size for commodities
Replies
4
Views
4K
TWI
TWI
William Rafter
  • Article
Technical Analysis Point & Figure Gone High Tech
Replies
18
Views
8K
GruntnoWay
G
Top