Trading with point and figure

[Dentalfloss]

trend break

 

[Dentalfloss]

Good Morning: The Long & the Short of it and The Bigger Picture - 31 March 2020 - ADM ISI

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Ostwald, Marc

08:32 (1 hour ago)

to Marc

- Digesting China NBS PMI rebound; ignoring Japan, UK, France data;
awaiting German labour data, US Consumer Confidence and Chicago PMI

- German Unemployment rises seen modest, but focus on likely huge jump
in Short-Time working

- US Consumer Confidence: collapse in labour demand implies downside
risks to expected record drop; Chicago PMI to slide, but not as much
as Dallas Fed?

- Outsized US investment grade issuance - both a desperate round of
capital raising and demand a reflection of zero liquidity in secondary
market....

- Chart: Dallas Fed Manufacturing

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** EVENTS PREVIEW **
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As is typical, there is a deluge of statistics to end the month and a quarter, where the descriptions 'unprecedented' and totally unanticipated are probably an understatement of what has the global economy. There are the China NBS PMIs to digest, the latter doubtless a huge relief bounce but unlikely to be sustained given the world at large remains in lockdown, with the usual rush of Japanese data being little more than statistical roadkill, as is the case with the run of UK data, Euro area inflation indicators and Canada's January GDP. In focus will be the German Unemployment data, even though the projected 25K rise in March Unemployment may appear modest, but disguises the volume of short-time working, for example VW alone has put 80,000 workers on short-time work, and the key comparison point being the total of 1.5 Mln short-time working in 2009, that record looks likely to be eclipsed very soon (if not already). Meanwhile the US has the Chicago PMI and more importantly Consumer Confidence, where the risks look to be the downside of a forecast record slide to 110.0 from 130.7, given the skyrocketing level of jobless claims - data collection timing may be the arbiter. Yesterday's Dallas Fed Manufacturing vertical drop should serve as a timely example of the sort of outliers that can be expected.

As for markets, a firmer tone has clearly emerged in Credit and equity indices, with record breaking volumes of USD IG Corporate issuance seeing US$37.175bn placed yesterday, which brings 2020 YTD volume to US$472.815bn vs. 2019 YTD: US$327.743bn, underlining a desperate need for cash at a corporate level, and investors rushing to lap up issuance at the much wider credit spread levels, to an extent driven by month / quarter end, but above all by the Fed's corporate bond buying. Ensuring that the IG primary corporate bond market continues to function is clearly critical at the current juncture, however a couple of points to be noted: a) a "healthy" primary market is no cure for secondary market lack of depth and liquidity, b) investors' appetite for all the new issuance is predicated on the visibility of pricing, of which there is none in the secondary market, c) this is not a sustainable modus operandi in the long run, nor is it a signal that volatility will not remain elevated, d) the current rash of credit ratings downgrade will continue at what is likely to be a record pace.

========================== ** THE DAY AHEAD ** ===========================

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[Dentalfloss]

blue needs to be rez

 

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[cantagril]

You're right..I've got 30/35 as being a pivoty supporty thingy but I don't like lowering stops as a matter of principle (contrary to common belief, I do have a couple) so I'm going to just take what I'm given rather than getting rid now.

Edit: and stopped out at 35 and now heading back up, of course Still 1/3 left on the trail

Just back in (from a sortie to the High Road - Lidl almost fully stocked. Tesco a shambles.)

Stopped out on the trail at 24 ...looking to take another Long around 4300 ish...

 

[cantagril]

Stopped out on the trail at 24 ...looking to take another Long around 4300 ish...

Late entry there at 4325, still itm though

 

[Dentalfloss]

Late entry there at 4325, still itm though

 

[cantagril]

View attachment 277181

I'm still in there with a stop at +15 but I'm looking at that first trend support crumbling and looking at the Dax for clues on the other - chart 5x3:

 

[cantagril]

Late entry there at 4325, still itm though

Glad I hung on - 1/3 off at 4400

 

[Dentalfloss]

Glad I hung on - 1/3 off at 4400

🥰🥰🥰🥰

 

[Dentalfloss]

Mornin folks 🥰 🥰 🥰 😷 😷 😷 🤧 🤧 🤧 😲 😲 😲 😲

 

[Dentalfloss]

Will it hold..??

 

[Dentalfloss]

 

[cantagril]

Morning!

Yesterday wasn't too bad considering but haven't quite worked out which way is up this morning

Late entry there at 4325

1/3 off at 4400

Stopped out 1/3 at 62 on the trail and the last bit at 50

Now long CAC 4205