Dentalfloss
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possibly no rate rise......but...they might be some dirty talk
Trading with point and figure
- Thread starter Dentalfloss
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Dentalfloss
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Carney been practising by phoning some chat lines
Dentalfloss
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eurusd
purple trendline gets tested in 1.1900 area
purple trendline gets tested in 1.1900 area
Dentalfloss
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seems to be setting up for $$ sell and overextended index sell
could be wrong
as always.....who the F**k knows
could be wrong
as always.....who the F**k knows
Dentalfloss
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Naz 100
in a dog zone
in a dog zone
Dentalfloss
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from Marc Ostwald
- Politics still ruling the roost with new 'radical' Italy govt and US JCPoA
exit in focus: BoE rate meeting and Inflation Report in focus; digesting
weaker than forecast China PPI & CPI, awaiting UK Industrial Production,
Trade and Construction Output, and US Claims and CPI; Irish 4/10 yr, US
30-yr, WASDE Agri report and more corporate earnings
- China CPI: sharp y/y fall in pork prices predicates CPI fall, PPI still
well behave despite first rise in 7 months
- UK BoE rate decision: no change expected, challenge for BoE is to craft
forecasts and rhetoric to suggest that August hike still on the cards;
vote probably close
- UK Industrial Production, Construction Output - weather effects likely
to be sustained
- US CPI: gasoline seen pacing pick-up in headline CPI, airfares likely
to pressure core along with OER and medical; apparel the wildcard
- Charts / tables: China CPI breakdown, BoE rate expectations by meeting,
GasBuddy US gasoline prices, IATA jet fuel prices, JPM EMBI avg yield
spread, US HY & IG Corporate bond spreads
..........................................................................
********************
** EVENTS PREVIEW **
********************
The question for today is whether the BoE MPC meeting and accompanying Q2 Inflation Report and press conference, along with a rash of first division data - China CPI, PPI (both weaker than expected, with Pork Prices -16% y/y continuing to pull CPI lower), US CPI, UK Industrial Production, Trade and Construction Output along with Italian Industrial Production and Brazilian Inflation - can divert the focus away from politics, above all the fall-out from the US exit from the Iran nuclear deal, and a likely quite sharp reaction to the announcement that the radical Lega and the 5 Star Movement will look to form the next Italian govt). A surprisingly dovish hold from New Zealand's RBNZ also needs to be digested. The Ascension Day holiday in parts of Europe will thin trading conditions somewhat, and there are the overnight BoJ 26-27 April Policy Meeting Summary of Opinions and Japan Economy Watchers survey to ponder ahead of the ECB Bulletin, Malaysia rate decision and the US May WASDE (World Agricultural Supply and Demand Estimates) report. A quieter day for govt bond auctions has sales in Ireland (4 & 10-yr) and the US (30-yr). Corporate earnings highlights are likely to include Panasonic; BT Group; Dropbox, Nvidia. Symantec, Ultra Petroleum & Banco do Brasil.
** U.K. - BoE rate decision / March Industrial Production, Trade & Construction Output **
- The sharp volte-face on UK rate expectations following Carney's comments, weak Q1 GDP, Services PMI and this week's dismal BRC Retail Sales have seen the probability of a hike on 10 May plunge from 87% to just 15%, though markets are still discounting a 59% chance of a 25 bps hike in August. The vote may be rather closer than the 7-2 against a hike at recent meetings, and the bank's fresh round of economic forecasts in its Q2 Inflation Report are likely to be critical in determining whether markets continue to discount one hike this year, an impression which the MPC will certainly want to maintain, in no small part with an eye on the risk of another fall in the GBP with negative implications for inflation, were the MPC to err on the dovish side. The challenge for Carney & Co is to fashion an inflation report that does not downgrade growth, and perhaps inflation, forecasts in such a way as to make a rate hike later in the year improbable, while somehow trying to preserve some semblance of credibility following the recent debacle. This episode has underlined that central bank rhetoric is taken at face value by markets, which had to be honest ridden roughshod over numerous economic indicators pointing to a very weak outcome for Q1 GDP, simply because BoE speakers were sticking to the narrative that a May rate hike was a high probability. Eminently this is just another example of the nonsense of 'efficient market theory', but one to which the BoE has been complicit. Mr Carney would do well to look to the example of his successor at the Bank of Canada, Mr Poloz, who explicitly dropped "guidance" more than a year ago, and like the Fed underlined 'data dependency', which in the BoE's case would be 'data and Brexit dependency' for the foreseeable future. The Q&A at the press conference may well prove quite 'testy', assuming no rate hike today, but a firm signal that an August rate hike is a strong possibility. As for the day's run of data, these are all March indicators, as such the consensus forecasts are to a large extent an extrapolation from the advance Q1 GDP, though revisions will as ever play a role. Be that as it may, following on from the reported six year low on the RICS House Price Balance overnight (which followed the Savills reporting a 12% fall over the past 3 year in London land values, see http://www.cityam.com/285499/savills-central-london-land-values-have-tumbled-12-per-cent ), headline Production is seen edging up 0.2% m/m mostly thanks to a boost from utilities due to the cold weather, with Manufacturing seen reprising its -0.2% m/m in February, and the highly erratic Construction Output projected to fall even more sharply -2.3% m/m, following February's -1.6%, echoing the very weak Q1 Housing Starts and anecdotal evidence of persistent weakness in commercial and civil construction. As with the much of the Eurozone, the key question is the extent to which Q2 data confirm Q1 as mostly weather related, or not as the case may be.
** U.S.A. - April CPI **
- Following on from the modest downside miss on PPI, the details of which sat uneasily with a broad array of anecdotal evidence, today brings CPI, which in month to month terms has increasingly appeared to be operating in a different universe to PPI over the past 18-24 months. Be that as it may, projections for headline CPI at 0.3% m/m 2.5% y/y (March 2.4%), paced by a fairly sharp rise in gasoline price, and core CPI at 0.2% m/m 2.2% y/y (March 2.1%) are hardly going to create a headache for the FOMC, and would also confirm that 'real average weekly earnings' growth is close to zero. At the core level, housing, medical costs are likely to continue to be the main points of pressure, with the recently very volatile Apparel component, and the likelihood that airfares (included in core prices) will also see quite a sharp rise, in so far as North America jet fuel prices jumped 5.8% m/m in April - see charts/table.
- Politics still ruling the roost with new 'radical' Italy govt and US JCPoA
exit in focus: BoE rate meeting and Inflation Report in focus; digesting
weaker than forecast China PPI & CPI, awaiting UK Industrial Production,
Trade and Construction Output, and US Claims and CPI; Irish 4/10 yr, US
30-yr, WASDE Agri report and more corporate earnings
- China CPI: sharp y/y fall in pork prices predicates CPI fall, PPI still
well behave despite first rise in 7 months
- UK BoE rate decision: no change expected, challenge for BoE is to craft
forecasts and rhetoric to suggest that August hike still on the cards;
vote probably close
- UK Industrial Production, Construction Output - weather effects likely
to be sustained
- US CPI: gasoline seen pacing pick-up in headline CPI, airfares likely
to pressure core along with OER and medical; apparel the wildcard
- Charts / tables: China CPI breakdown, BoE rate expectations by meeting,
GasBuddy US gasoline prices, IATA jet fuel prices, JPM EMBI avg yield
spread, US HY & IG Corporate bond spreads
..........................................................................
********************
** EVENTS PREVIEW **
********************
The question for today is whether the BoE MPC meeting and accompanying Q2 Inflation Report and press conference, along with a rash of first division data - China CPI, PPI (both weaker than expected, with Pork Prices -16% y/y continuing to pull CPI lower), US CPI, UK Industrial Production, Trade and Construction Output along with Italian Industrial Production and Brazilian Inflation - can divert the focus away from politics, above all the fall-out from the US exit from the Iran nuclear deal, and a likely quite sharp reaction to the announcement that the radical Lega and the 5 Star Movement will look to form the next Italian govt). A surprisingly dovish hold from New Zealand's RBNZ also needs to be digested. The Ascension Day holiday in parts of Europe will thin trading conditions somewhat, and there are the overnight BoJ 26-27 April Policy Meeting Summary of Opinions and Japan Economy Watchers survey to ponder ahead of the ECB Bulletin, Malaysia rate decision and the US May WASDE (World Agricultural Supply and Demand Estimates) report. A quieter day for govt bond auctions has sales in Ireland (4 & 10-yr) and the US (30-yr). Corporate earnings highlights are likely to include Panasonic; BT Group; Dropbox, Nvidia. Symantec, Ultra Petroleum & Banco do Brasil.
** U.K. - BoE rate decision / March Industrial Production, Trade & Construction Output **
- The sharp volte-face on UK rate expectations following Carney's comments, weak Q1 GDP, Services PMI and this week's dismal BRC Retail Sales have seen the probability of a hike on 10 May plunge from 87% to just 15%, though markets are still discounting a 59% chance of a 25 bps hike in August. The vote may be rather closer than the 7-2 against a hike at recent meetings, and the bank's fresh round of economic forecasts in its Q2 Inflation Report are likely to be critical in determining whether markets continue to discount one hike this year, an impression which the MPC will certainly want to maintain, in no small part with an eye on the risk of another fall in the GBP with negative implications for inflation, were the MPC to err on the dovish side. The challenge for Carney & Co is to fashion an inflation report that does not downgrade growth, and perhaps inflation, forecasts in such a way as to make a rate hike later in the year improbable, while somehow trying to preserve some semblance of credibility following the recent debacle. This episode has underlined that central bank rhetoric is taken at face value by markets, which had to be honest ridden roughshod over numerous economic indicators pointing to a very weak outcome for Q1 GDP, simply because BoE speakers were sticking to the narrative that a May rate hike was a high probability. Eminently this is just another example of the nonsense of 'efficient market theory', but one to which the BoE has been complicit. Mr Carney would do well to look to the example of his successor at the Bank of Canada, Mr Poloz, who explicitly dropped "guidance" more than a year ago, and like the Fed underlined 'data dependency', which in the BoE's case would be 'data and Brexit dependency' for the foreseeable future. The Q&A at the press conference may well prove quite 'testy', assuming no rate hike today, but a firm signal that an August rate hike is a strong possibility. As for the day's run of data, these are all March indicators, as such the consensus forecasts are to a large extent an extrapolation from the advance Q1 GDP, though revisions will as ever play a role. Be that as it may, following on from the reported six year low on the RICS House Price Balance overnight (which followed the Savills reporting a 12% fall over the past 3 year in London land values, see http://www.cityam.com/285499/savills-central-london-land-values-have-tumbled-12-per-cent ), headline Production is seen edging up 0.2% m/m mostly thanks to a boost from utilities due to the cold weather, with Manufacturing seen reprising its -0.2% m/m in February, and the highly erratic Construction Output projected to fall even more sharply -2.3% m/m, following February's -1.6%, echoing the very weak Q1 Housing Starts and anecdotal evidence of persistent weakness in commercial and civil construction. As with the much of the Eurozone, the key question is the extent to which Q2 data confirm Q1 as mostly weather related, or not as the case may be.
** U.S.A. - April CPI **
- Following on from the modest downside miss on PPI, the details of which sat uneasily with a broad array of anecdotal evidence, today brings CPI, which in month to month terms has increasingly appeared to be operating in a different universe to PPI over the past 18-24 months. Be that as it may, projections for headline CPI at 0.3% m/m 2.5% y/y (March 2.4%), paced by a fairly sharp rise in gasoline price, and core CPI at 0.2% m/m 2.2% y/y (March 2.1%) are hardly going to create a headache for the FOMC, and would also confirm that 'real average weekly earnings' growth is close to zero. At the core level, housing, medical costs are likely to continue to be the main points of pressure, with the recently very volatile Apparel component, and the likelihood that airfares (included in core prices) will also see quite a sharp rise, in so far as North America jet fuel prices jumped 5.8% m/m in April - see charts/table.
Dentalfloss
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24565 lined up
Dentalfloss
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cable 1.3550 lining up
Atilla
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Morning folks 
Looking at Cable and here are my daily Woodie's PPs.
R3 @ 1.3704
R2 @ 1.3655
R1 @ 1.3598
PP @ 1.3549
S1 @ 1.3492
S2 @ 1.3443
S3 @ 1.3386
Expecting today to be a little volatile. I'm thinking expectations pretty much on the ball and news already in the price. Don't see rate hike and Marc Oswald says it all nicely.
Anyhow, I'm thinking noise factored in already and we may see R1 @ 1.3598 towards end of the day.
Looking at Cable and here are my daily Woodie's PPs.
R3 @ 1.3704
R2 @ 1.3655
R1 @ 1.3598
PP @ 1.3549
S1 @ 1.3492
S2 @ 1.3443
S3 @ 1.3386
Expecting today to be a little volatile. I'm thinking expectations pretty much on the ball and news already in the price. Don't see rate hike and Marc Oswald says it all nicely.
Anyhow, I'm thinking noise factored in already and we may see R1 @ 1.3598 towards end of the day.
Dentalfloss
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swissy in heaven with Ftse dump
Dentalfloss
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Morning folks
Looking at Cable and here are my daily Woodie's PPs.
R3 @ 1.3704
R2 @ 1.3655
R1 @ 1.3598
PP @ 1.3549
S1 @ 1.3492
S2 @ 1.3443
S3 @ 1.3386
Expecting today to be a little volatile. I'm thinking expectations pretty much on the ball and news already in the price. Don't see rate hike and Marc Oswald says it all nicely.
Anyhow, I'm thinking noise factored in already and we may see R1 @ 1.3598 towards end of the day.
yeah...seems so
but you might get dirty talk/hawkish comments at press conference.....could hike it more
Atilla
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More is always good
Have a long bias. Ears to the ground.
I think it will hover around PP until Carney the Canary sings the tune his prepared for us
C
cantagril
Half off at 67 for +35 and stopped out for +10 on the rest. Might try a long at .8750 if we go there again soon.
C
cantagril
Long EG .8747 Target .8767
Atilla
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Atilla
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I don't normally trade EG but if I were, Woodie says...
R3 @ 0.8807
R2 @ 0.8787
R1 @ 0.8768
PP @ 0.8788
S1 @ 0.8729
S2 @ 0.8709
S3 @ 0.8690
fwiw - There is an inverse relationship with GU so I'd have short bias on EG. In fact good pair bet to short EG and long on GU imo.
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Dentalfloss
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Ask Sir Canta...he is good on correlations
Atilla
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Dear Cir Santa,
I have a dreadful lisp prouncing my Cs as essess. Can you help me please? :cheesy:
Last edited:
C
cantagril
Nought but a viscous canard, Atilla!
Yes I do fiddle about with the EG and GBPCHF correlation but really look for the spread between the two pairs as a profit source. If you do what you say (i.e short against long) then really you're just reinforcing your view rather than hedging it.
I use a very simple chart (see below) which tells me if the divergence is more or less than I think it should be.
Just got my fill on EG and am now long GBPCHF at 1.3560
