Trading with point and figure

Dentalfloss · Mar 6, 2019

Dow into the open

Dentalfloss · Mar 6, 2019

Dow
on these inputs.....not lookin too happy from that reaction area on 4th March

Dentalfloss · Mar 6, 2019

A very wide support area and a very wide rez area

Dentalfloss · Mar 6, 2019

close up

Dentalfloss · Mar 6, 2019

FTSE

Dentalfloss · Mar 6, 2019

Dentalfloss · Mar 6, 2019

Dentalfloss · Mar 6, 2019

Good Morning: The Long & the Short of it and The Bigger Picture - 6 March 2019 - ADM ISI

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Ostwald, Marc
08:55 (25 minutes ago)

to Marc

- Modest schedule of data and events has Australia Q4 GDP to digest along
with BIS Quarterly Review; ahead lie rate decisions in Canada & Poland,
US ADP Employment, US / Canada trade, Fed Beige Book, BoE and Fed
speakers; UK to auction 2024 conventional Gilt

- US ADP Employment: consensus forecast once again agnostic, but overall
picture on US labour demand still very, very robust

- BoC: no change expected, run of recent data makes strong case for very
prolonged pause on rates

- "Morning Call" audio
https://www.mixcloud.com/MOstwaldADM/adm-isi-morning-call-daily-macro-and-market-preview/

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** EVENTS PREVIEW **
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The day's schedule of data and events is certainly not overwhelming, amounting to the overnight Australia Q4 GDP (weaker than expected at a pedestrian 0.2% q/q, though very much in line with recent data and thus reinforcing expectations of an RBA rate cut this year, despite relatively optimistic comments from RBA governor Lowe overnight. This afternoon brings US ADP Employment along with US & Canadian Trade (both December), while the OECD publiahes its interim global economic outlook, which is accompanied by some central bank speak (BoE Cunliffe & Haldane, Fed's Mester & Williams) and the Fed's Beige Book, while the UK auctions £3.0 Bln of 2024 Gilt. Beyond that there is the usual treasure trove of articles that form the BIS Quarterly Review - https://www.bis.org/publ/qtrpdf/r_qt1903.htm , with the Claudio Borio / Hyun Song Shin 'On The Record' briefing here: https://www.bis.org/publ/qtrpdf/r_qt1903_ontherecord.htm.

In terms of the US ADP Employment estimate, the consensus is the usual highly agnostic 190K (modestly above the median 180K for Private Payrolls), with a reminder that the January ADP estimate was 213K, well below the actual 296K for Private Payrolls, and in turn accounting for the higher ADP estimate for February. For all that markets may well react to anything that is net 25K above or below the consensus, the simple fact of the matter is that US labour demand remains very robust (as signalled by the record level of JOLTs job openings), regardless of the minutiae of today's report or Friday's official data. That this is not really generating any major upward pressure on wages obviously gives the FOMC plenty of room to be 'patient', though it is worth noting this report from the Dallas Fed research dept suggesting that wage growth may be rather stronger than AHE or ECI data suggest - https://www.dallasfed.org/research/economics/2019/0226 .

As for the Bank of Canada, no change in rates is expected, and the run of recent data (Q4 GDP SAAR just 0.4%, headline CPI to 1.4% y/y, core flat as a pancake at 1.9% for past 12 months, sluggish Retail Sales, flat house prices) offer an even more compelling case for the BoC to be as, not more "patient" than the Fed. A rate hike this year looks to be an increasingly unlikely proposition, though unlike the RBA or RBNZ, the BoC's direction of travel on rates remains higher.