Trading with point and figure

oil/wti /OCT

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watch to see if 46.00 area becomes rez..not good for index..imho
 
- Digesting soft German Orders, UK BRC Sales, as expected RBA decision,
solid Swiss GDP; awaiting Eurozone GDP details, US Non-manufacturing
ISM and Labour Market Conditions Index; UK, Austria & Germany auctions

- US Non-manufacturing ISM: seen edging down, though overall pace of
activity solid; market looking more to Fed speakers than data given
deep FOMC divisions

- Charts: WTI Oil future, 30-yr JGB yield & German Factory Orders y/y

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

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

While the passing of the Labor Day holiday generally marks the end of the summer holiday season in financial markets, they may be hard pushed to find much inspiration from today's statistical schedule, outside of the US Non-Manufacturing ISM. There are the UK BRC Retail Sales (worse than expected, but primarily due to the hot August weather), Australian Q2 Current, Swiss Q2 GDP (way above forecasts at 0.6% q/q 2.0% y/y) and German Factory Orders (still very sluggish) to digest, while the South African Q2 GDP looks to be rather subsidiary to the current array of political shenanigans, and the details on Eurozone Q2 GDP will be of rather more academic interest. In policy terms, Glenn Stevens' final policy meeting as RBA governor saw its policy rate left unchanged as expected, with an implicit easing bias, while Herr Schaeuble presents the 2017 federal budget to Germany's Bundestag, with some ECB and Fed speak rounding off proceedings. Per se, there is likely to be further debate on what, if anything, should be made of the rather vague Russia/Saudi Arabia 'agreement' on capping oil production sometime during the rest of H2 2016. The latter looks to be far more about geo-politics, spheres of influence in the context of The Great Game and The Game of Nations, though in a 21st century context, a theme which I will attempt to explore in the next edition of 'The Ghost in the Machine'. A modest week for Eurozone government bond supply gets under way with Austria offering EUR 1.1 Bln 7 & 10-yr, while Germany re-opening its 10-yr inflation-linked Bund, though only in EUR 500 Mln. In the UK the DMO sells £2.5 Bln of the current 10-yr benchmark, while the BoE conducts its over 15-yr Gilt weekly QE purchase operation.

** U.S.A. - August Non-manufacturing ISM **
- Following a 'mixed bag' labour report, in the sense that it was not weak enough to completely banish any perceived residual risk of a September rate hike (from a market perspective), the remaining run of US data and surveys perhaps gains some extra sensitivity, particularly Retail Sales and CPI. Today's ISM services survey is expected to see a modest setback to 55.0 from July's 55.5, but such an outturn would again be rather inconclusive, with the Business Activity Index also seen marginally lower at a solid 58.8 (vs 59.3). The fact remains that the Fed's data dependency is rather moot, given the lack of FOMC consensus on what should be 'triggers' or 'show stoppers' for policy action. Per se Fed speak between now and the start of next week's pre-meeting purdah period may be of rather greater significance.


from Marc Ostwwald
 
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