Trading with point and figure

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Eurusd gettin bought

 

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EG

 

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OIL in supp

 

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UJ

 

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Dow in supp
will it hold..??

 

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Good Morning: The Long & the Short of it and The Bigger Picture - 7 May 2019 - ADM ISI

Ostwald, Marc

09:17 (20 minutes ago)

to Marc

- Digesting RBA no change & weak Australian Retail sales, sluggish German
Orders and as expected Malaysia rate cut; US JOLTS Job Openings &
Consumer Credit the only items of note on remaining data schedule; BoE,
Fed & Riksbank speak, France 'debt summit' and EC forecast update
accompany Austria, Germany & US auctions and plenty of corp earnings

- RBA: unexpected hold most likely a case of delay due to election

- German Orders: tepid bounce underscores continued headwinds for
manufacturing

- US/China trade talks: Trump 'gaming' domestic political audience?

- US JOLTS Job Openings: set for solid rebound from 'shutdown' related
slide in February?

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

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

There is a modest schedule of data and a slightly busier one of events and corporate earnings to try and distract markets from the volatile news flow surrounding US/China Trade negotiations along with Brexit & the UK political crisis. On the "to digest" front there are the RBA 'hold' and Bank Negara Malaysia rate cut to digest along with Australian Retail Sales & Trade, German Factory Orders and French Trade data. Ahead lie US JOLTS Job Openings, central bank speak from the Fed, BoE and Riksbank, and a forecast update from the EU Commission accompanies a high level conference in France on debt. A plentiful corporate earnings schedule is likely to find Alstom, Anheuser-Busch InBev, BMW, Ferrovial, Henkle, Infineon, Intesa San Paolo and Uniper in Europe, along with Allergan, Lyft & Western Union in he US and Brazil's Petrobras among the headline makers. Govt bond supply has 4 & 10-yr in Austria, Inflation-Linked Bunds in Germany and a new US 10-yr on offer. Overall markets appear to be taking a sanguine view on the Trump China trade deal 'tweets' after the initial 'helter skelter' on Sunday night and through the Asian and early European sessions, presumably taking the view that Trump is once again trying to 'game' China with those comments, and doubtless attempting to manipulate his domestic audience by suggesting that the talks might be on the point of collapse, only to later (this week, or later) declare himself and his coterie of advisers & negotiators the 'heroes of the day', even if the details of any deal that may be reached may well be very meagre fare, like the USMCA which went through a similar process of talking down a deal with Canada, only to cheer the final outcome, which was in material terms (ex-Dairy) a rather marginal change relative to NAFTA. Last but not least, a renewed tumble in the Turkish Lira is a reminder that it (along with the Argentine Peso) has an understandable asymmetric skew in risk terms to political news, following the announcement of a re-run of the Istanbul local election, though in contrast to Argentina where a re-election of Macri in October would be welcomed by markets, only an IMF bail-out and/or a seismic shift in the political and economic policy landscape will fashion any material and sustained recovery for the Turkish currency.

In terms of the overnight data and events, Australia managed to deliver a classic sucker punch, with much weaker than expected Q1 Retail Sales elevating expectations of an RBA rate hike, only for the RBA to keep rates unchanged at 1.50%, though still indicating that a rate cut is very likely. Presumably the proximity of the general election advised against a move this month, but a 25bps cut to 1.25% still seems very likely in June. The modest bounce in the Japan Manufacturing PMI (50.2 vs. prior 49.2) was predicated on Orders (domestic, rather than exports) and Output, but both remain in negative territory. As for German Factory Orders, these again managed to miss expectations by posting a very lukewarm 0.6% m/m rebound after sliding 4.0% m/m in February, and per se affirming that a recovery in the manufacturing sector is still looking rather elusive, and will likely be U or L rather than V shaped.

** U.S.A. - March JOLTS Job Openings **
- February's sharp drop in Job Openings to 7.087 Mln from a near record 7.625 Mln in January more than likely owed a lot to the govt shutdown, and that in turn predicates expectations of a relatively sharp rebound to 7.35 Mln in March, above all given continued strength in a broad array of other labour market data. The tightness of the labour market continues to be the primary argument against the Fed even vaguely hinting at any rate cut this year, and should headline CPI edge above the Fed's 2.0% target when published on Friday, then a rate hike by the end of the year, or in Q1 2020 is a realistic possibility.

 

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Dax updated

 

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DAX updated

 

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Waitrose in Godalming...... Waiting for women

 

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No show.... As yet

 

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Breaking
Baby Sussex called Donald

 

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No show..... Still

 

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back at the desk

 

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we should be in supp

 

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DAX

 

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lined up

 

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doesn't look like it!