Trading with point and figure

dentist007 said:
our rez got blown out
now its in another horizontal rez area

33tnfhx.png
Click to expand...


dow testing our 25475 to 25500 rez area on overnight rally
dax has blown out our 12.4K.......will need to recalibrate
 
12390-12410 is a big supp area if tested..lets see what happens
12505-12516 rez


COULD BE WRONG........lol
 
- Quiet start to week dominated by US and to a lesser extent China data,
focus on India CPI/Production, Brexit negotiation and Trump tariff
related news flows

- US CPI and Retail Sales headline busy week for top tier US data, Fed in
purdah, US to sell 3, 10 & 30 yr debt

- UK looks to Spring (budget) statement and Brexit in very quiet week for
data, weak Visa Consumer Spending in part due to weather effects

- Eurozone: watching start of likely unstable Grand coalition, along with
raft of ECB speakers

- Japan: Orders and BSI in focus as cronyism accusations move up the
attention scale

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

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

A very quiet day to start the week in statistical terms, with nothing more than Indian CPI and Industrial Production (see below) to look forward to, though the normally ignored monthly US Treasury Budget data may start to garner more attention, though probably as of the May quarter, when borrowing is expected to ratchet higher. There is the BIS quarterly review to read, mark and inwardly digest http://www.bis.org/publ/qtrpdf/r_qt1803.htm, with some interesting articles on how share buybacks are impacting Current Account balances https://www.bis.org/publ/qtrpdf/r_qt1803f.htm and the impact of pasive bond funds https://www.bis.org/publ/qtrpdf/r_qt1803j.htm. In respect of the latter, this conclduding point echoes a view that we have expressed on a number of occasions: " hird, the link between ETF trading and underlying security prices deserves further study. In particular, secondary market arbitrage of ETF shares appears to constitute an additional (and potentially more important) transmission channel to prices compared with that which works through fund flows." Today sees the start of fiyr days of various debates and presentations on the EU's Brexit negotiating parameters, while the Trump tariff fall-out will of course remain front and central.


RECAP: The Week Ahead - Preview

- The US looks likely to be main point of focus with a barrage of data, another lump of Bill ($96 Bln) and Coupon ($62 Bln in 3, 10 & 30-yr) issuance, and the ongoing Korean and Trade tariff sagas, as the Fed goes into purdah ahead of its 20/21 March FOMC meeting . China publishes its monthly economic activity data, the UK has no data but it will be a key week for Brexit negotiations and Chancellor Hammond will present the government's Spring Statement (on public finances). It will also be a modest week for Eurozone data, though there will be plenty of ECB speakers.

- Statistically, the US has pretty much all its first division data and more, with the focus on CPI and Retail Sales, which are accompanied by PPI, Industrial Production, Housing Starts, Treasury Budget as well as NFIB, NAHB Housing and NY & Philly Fed Manufacturing surveys. US CPI is forecast to rise a 'military medium' 0.2% m/m on both headline and core, which would edge up headline 2.2% y/y from 2.1%, but leave core unchanged at 1.8%, with a fall in gasoline prices offset by a pick-up in food prices, while housing (OER last 0.3% m/m), Medical Care (0.4% m/m) and Apparel (1.7%) likely to be the other key swing factors. January Retail Sales proved disappointing (headline -0.3% m/m, ex-Autos & Gas -0.2%) with the early month big freeze taking some of the blame, and an assumption that February will bounce back with a gain of 0.3% m/m seen across the board. The ever volatile Japan Machinery Orders data are expected to post a bounce of 5.2% m/m after sliding surprisingly heavily in December (-11.9% m/m), and may indeed exceed forecasts given positive indicators from monthly surveys, with the quarterly BSI survey also due at the start of the week. It is a measure of how little there is in data terms elsewhere that the other key item will be India's CPI (WPI, Trade and Industrial Production are also due), particularly sensitive given a more hawkish tone emanating from the RBI, and the drop in its February PMIs that was blamed on inflation pressures. The consensus looks for a modest easing to a 4.74% y/y pace from January's 5.07% and December's 5.21%, though this would still leave it well above the RBI's 4.0% target, and also in no small part be due to beneficial base effects for February and March, which will then become distinctly adverse effects in Q2.

- In central bank terms, Switzerland's SNB holds its quarterly policy meeting, but it is expected to hold it key deposit rate target -0.75% both at this meeting and indeed through to Q3 2019, with an initial hike seen in December 2019. Inflation is projected to be little changed over that time horizon (end 2018 0.7% end 2019 0.8%), though GDP is expected to pick up from an average 1.0% in 2017 to 1.9% on average in 2018, with 2019 seen at 1.7%. The SNB will doubtless continue to emphasize that the CHF is overvalued, and will certainly make every effort to be behind whatever the ECB's rate trajectory turns out to be. Norway's central bank is expected to hold rates at 0.50%, and will likely view the still very subdued pace of underlying (core) CPI as offering little reason to make any major changes to its rate trajectory. ECB speakers are plentiful, with Draghi, Coeure and Praet all due to offer their thoughts, while elsewhere the ever thoughtful RBA deputy Debelle and BoC governor Poloz will also speak.

- Politically, there will be no getting away from the enduring themes of trade tariffs, North Korea or Brexit, in a week which will also see Merkel sworn in for a fourth and very likely final term as German Chancellor in what will be a rather unstable coalition, with little expected in the way of progress on forming an Italian govt following the election stalemate. The UK Spring Statement should sound a slightly less pessimistic tone than that struck by the November Budget's OBR report, above all in terms of the headroom available for the Chancellor for a slightly looser near-term fiscal stance, with the longer-term view still very much clouded by what may or may not come out of the Brexit negotiations. There will indeed be a whole host of announcements on Brexit negotiations throughout next week, and the Conservative party holds a conference at the end of the week to discuss Brexit. In the US, the Special Congressional election in Pennsylvania will be very closely watched as a proxy for what might occur at the mid-term elections, in November. Last but not least, Russia holds its presidential elections next weekend.

- The corporate earnings season continues to wind down, with the focus in the US on Adobe Systems, Broadcom, Micron Technology & Tiffany, while elsewhere Adidas, Capita, Cathay Pacific Airways, E.On, Innogy, Generali, Lukoil, Petrobras, Prudential Plc and RWE are likely to be among the headliners.

- Government bond supply is plentiful and as noted, led by the US, though it will also be a busy week in the Eurozone with auctions in Italy, Germany, Netherlands, France and Spain, while the UK offers 10-yr and Japan sells 5 & 20-yr.

- Energy markets will be looking to the OPEC and IEA monthly Oil Market reports.

from Marc Ostwald
 
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