Trading with point and figure
- Thread starter Dentalfloss
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Dentalfloss
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dax
pump or dump area /aqua horizontal
pump or dump area /aqua horizontal
Dentalfloss
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megaa rez 10545-10567
Dentalfloss
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now ..we have an idea where mega rez is
we are in strong rez with those pump or dump areas
imho
we are in strong rez with those pump or dump areas
imho
Dentalfloss
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dump to 6860 area as we marked
Dentalfloss
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and bounce
tight stops
Dentalfloss
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Digesting BoJ tweaking jamboree, awaiting Fed; UK PSNB, South Africa CPI
and Japan trade to be digested; German to sell 5-yr; EIA oil inventories
in focus after API crude stocks slide, China oil product export surge
- BOJ: plethora of tweaking measures underline monetary policy exhaustion,
leaving JPY as the safety valve for markets
- FOMC: 'hawkish hold' expected, focus on level of dissent, egregious
'dot plot', forecast tweaks ahead of Yellen press conference
- Charts: Saudi Oil Inventories, WTI Oil future, USD/JPY & JGB 5/10 yr
yield spread
..........................................................................
********************
** EVENTS PREVIEW **
********************
The day obviously belongs to the Bank of Japan and the Federal Reserve, with the rest of another minimalist data schedule merely flotsam and jetsam on this central bank sea. The latter features Japan Trade, UK PSNB budget and South African CPI data, with the OECD's economic forecast update, an expected no change rate decision from New Zealand's RBNZ, and further zero cost funding for Germany. The latter appears to be a case of "buy now, while you still can, as the Q4 issuance volume in Germany has been cut by a further EUR 7.0 Bln (mostly bills), due to higher than expected tax revenues. In terms of the UK PSNB, the consensus looks for a £10.3 Bln deficit, which would be little changed vs August 2015, and indeed most August readings for the past 5 years, reflecting the fact there are typically few surprises during the summer holidays. It is also EIA oil inventories day, with the shock 7.5 Mln bbls in the API measure against an expected rise of 3.4 Mln putting a floor under oil prices for the time being. In that respect it is worth noting that while Saudi Arabia has been resolutely raising output over this year, its inventories are being steadily depleted, as per the attached chart. On the other hand China's overnight oil product export data underline the counterbalancing risks that continue to be posed by product overhangs.
** Japan - BoJ policy decision **
- While a number of the measures that the BoJ has opted for were not 'floated as balloons', the only real surprise was the limited level of dissent to the array of measures. The overall impression is that this plethora of policy tweaking underlines a) the limited scope to make any major policy moves; b) makes explicit an inflation overhsoot target without any obvious measures to suggest that it will be any more successful than those of the past 20 years (in Japan's case), and c) puts the onus on the government to do far more to stimulate growth and inflation, and d) leaves the JPY as the safety / pressure valve for market sentiment. The BoJ policy can now be described as Quantitative and Qualitative Easing with Yield Curve Control and Inflation target overshooting, which is so verbose as to be nigh on meaningless. While not relevant in the short-term, it can be safely said that as, (if?) and when the BoJ decides to start to look for the exit from these measures, it will inevitably unleash a tidal wave of financial destruction. By setting a specific target for the 10-yr yield and suggesting it will intervene if long-dated yields become disorderly, which seems highly likely, it is setting itself up to be tested by markets at the longer end of the market, though it effectively also kills off any residual sense that the JGB curve to 10 years is really a market. That said, by fixing rates so far out on the curve, and leaving open the option to cut the policy rate further, it does put the JPY more firmly in the 'funding currency' category, which should in theory help to weaken the JPY, though short-term Japanese half-year end and quarter end elsewhere may lean against any immediate moves. In principle it also effectively puts a floor on 10-yr Bund yields, unless the ECB opts to ease policy rates further, for which there appears to be little appetite short-term. Given the BoE's determination to signal that it may still cut rates again, and given emergent concerns about 'hard Brexit', it also imparts a near-term downside bias for the GBP; while an increasingly neutral tone to RBA policy comments and the still relatively elevated levels of carry into the AUD out of the JPY, should give the AUD support, and the same applies to the NZD.
** U.S.A. - FOMC meeting **
- The ugly phrase 'hawkish hold' covers what markets are expecting from today's FOMC meeting. For all that there has been a distinct shift in many Fed speakers' rhetoric to this meeting, the combination of the weak ISM readings and the bulk of last week's major data run has left the Fed Funds future ascribing just a 22% chance to a rate hike at today's meeting. No change is expected from current 0.25-0.50%, though there is a strong chance that there will be additional dissenters to Esther George, most probably Cleveland Fed's Loretta Mester. A fresh 'dot plot' is seen lowering the rate trajectory yet again, but still implying at least one 2016 rate hike, but a lower trajectory and a lower "long run" rate (last 2.8%-3.8%). The question is what happens to the Fed's forecasts (see recap of June 2016 forecasts attached), with the consensus expecting the GDP forecasts to be tweaked slightly lower. Friday's CPI data leaves the Fed in a difficult position, with sticky 'core CPI' elements: most notably Housing (OER) 0.3% m/m 3.8% yy/y, Services 0.3% m/m 3.0% y/y/, Medical Care 1.0% m/m 4.9%, which underlined that the "low" headline CPI was only due to Food 0.0% y/y & Energy -9.2% y/y, the latter will start to unwind quite rapidly into the end of the year. Obviously PCE deflator levels are currently lower than those for CPI, but to hide behind the vagaries of index weightings would be farcical. The key aspect of Yellen's press conference will as ever be how the tone she strikes on the economy and the policy outlook, contrasts with the impression that markets initially take from the bald and blunt changes to the FOMC's central projections and the rather spurious 'dot plot'. As previously noted September hike cannot be ruled out completely, above all given the fact that a November meeting hike looks to be off the table, given its proximity to the election. But given that the FOMC as a whole showing no sign of eschewing running scared of its own shadow, it seems highly improbable.
from Marc Ostwald
and Japan trade to be digested; German to sell 5-yr; EIA oil inventories
in focus after API crude stocks slide, China oil product export surge
- BOJ: plethora of tweaking measures underline monetary policy exhaustion,
leaving JPY as the safety valve for markets
- FOMC: 'hawkish hold' expected, focus on level of dissent, egregious
'dot plot', forecast tweaks ahead of Yellen press conference
- Charts: Saudi Oil Inventories, WTI Oil future, USD/JPY & JGB 5/10 yr
yield spread
..........................................................................
********************
** EVENTS PREVIEW **
********************
The day obviously belongs to the Bank of Japan and the Federal Reserve, with the rest of another minimalist data schedule merely flotsam and jetsam on this central bank sea. The latter features Japan Trade, UK PSNB budget and South African CPI data, with the OECD's economic forecast update, an expected no change rate decision from New Zealand's RBNZ, and further zero cost funding for Germany. The latter appears to be a case of "buy now, while you still can, as the Q4 issuance volume in Germany has been cut by a further EUR 7.0 Bln (mostly bills), due to higher than expected tax revenues. In terms of the UK PSNB, the consensus looks for a £10.3 Bln deficit, which would be little changed vs August 2015, and indeed most August readings for the past 5 years, reflecting the fact there are typically few surprises during the summer holidays. It is also EIA oil inventories day, with the shock 7.5 Mln bbls in the API measure against an expected rise of 3.4 Mln putting a floor under oil prices for the time being. In that respect it is worth noting that while Saudi Arabia has been resolutely raising output over this year, its inventories are being steadily depleted, as per the attached chart. On the other hand China's overnight oil product export data underline the counterbalancing risks that continue to be posed by product overhangs.
** Japan - BoJ policy decision **
- While a number of the measures that the BoJ has opted for were not 'floated as balloons', the only real surprise was the limited level of dissent to the array of measures. The overall impression is that this plethora of policy tweaking underlines a) the limited scope to make any major policy moves; b) makes explicit an inflation overhsoot target without any obvious measures to suggest that it will be any more successful than those of the past 20 years (in Japan's case), and c) puts the onus on the government to do far more to stimulate growth and inflation, and d) leaves the JPY as the safety / pressure valve for market sentiment. The BoJ policy can now be described as Quantitative and Qualitative Easing with Yield Curve Control and Inflation target overshooting, which is so verbose as to be nigh on meaningless. While not relevant in the short-term, it can be safely said that as, (if?) and when the BoJ decides to start to look for the exit from these measures, it will inevitably unleash a tidal wave of financial destruction. By setting a specific target for the 10-yr yield and suggesting it will intervene if long-dated yields become disorderly, which seems highly likely, it is setting itself up to be tested by markets at the longer end of the market, though it effectively also kills off any residual sense that the JGB curve to 10 years is really a market. That said, by fixing rates so far out on the curve, and leaving open the option to cut the policy rate further, it does put the JPY more firmly in the 'funding currency' category, which should in theory help to weaken the JPY, though short-term Japanese half-year end and quarter end elsewhere may lean against any immediate moves. In principle it also effectively puts a floor on 10-yr Bund yields, unless the ECB opts to ease policy rates further, for which there appears to be little appetite short-term. Given the BoE's determination to signal that it may still cut rates again, and given emergent concerns about 'hard Brexit', it also imparts a near-term downside bias for the GBP; while an increasingly neutral tone to RBA policy comments and the still relatively elevated levels of carry into the AUD out of the JPY, should give the AUD support, and the same applies to the NZD.
** U.S.A. - FOMC meeting **
- The ugly phrase 'hawkish hold' covers what markets are expecting from today's FOMC meeting. For all that there has been a distinct shift in many Fed speakers' rhetoric to this meeting, the combination of the weak ISM readings and the bulk of last week's major data run has left the Fed Funds future ascribing just a 22% chance to a rate hike at today's meeting. No change is expected from current 0.25-0.50%, though there is a strong chance that there will be additional dissenters to Esther George, most probably Cleveland Fed's Loretta Mester. A fresh 'dot plot' is seen lowering the rate trajectory yet again, but still implying at least one 2016 rate hike, but a lower trajectory and a lower "long run" rate (last 2.8%-3.8%). The question is what happens to the Fed's forecasts (see recap of June 2016 forecasts attached), with the consensus expecting the GDP forecasts to be tweaked slightly lower. Friday's CPI data leaves the Fed in a difficult position, with sticky 'core CPI' elements: most notably Housing (OER) 0.3% m/m 3.8% yy/y, Services 0.3% m/m 3.0% y/y/, Medical Care 1.0% m/m 4.9%, which underlined that the "low" headline CPI was only due to Food 0.0% y/y & Energy -9.2% y/y, the latter will start to unwind quite rapidly into the end of the year. Obviously PCE deflator levels are currently lower than those for CPI, but to hide behind the vagaries of index weightings would be farcical. The key aspect of Yellen's press conference will as ever be how the tone she strikes on the economy and the policy outlook, contrasts with the impression that markets initially take from the bald and blunt changes to the FOMC's central projections and the rather spurious 'dot plot'. As previously noted September hike cannot be ruled out completely, above all given the fact that a November meeting hike looks to be off the table, given its proximity to the election. But given that the FOMC as a whole showing no sign of eschewing running scared of its own shadow, it seems highly improbable.
from Marc Ostwald
Dentalfloss
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10457-10478 is supp area
then 10413-10435 area
then 10413-10435 area
Dentalfloss
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if 6860 fails ..then 6832-6846 area
Dentalfloss
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ftse and dax into rez /minor
pump or dump
pump or dump
6860 holding, possible fake 6850- 55 though. Lets see.
Dentalfloss
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ftse 1 min
breaking down
supp looming
breaking down
supp looming
Dentalfloss
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dax1 minute
MichaelJohnFX
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Only really interested in two areas 10547-10571 and 10634-10670.
if FED do as expected, I'm expecting a pump then dump scenario. Will be watching those areas above to do business in.
if FED do as expected, I'm expecting a pump then dump scenario. Will be watching those areas above to do business in.
Dentalfloss
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10500 retest..there now
we could dump
we could dump
MichaelJohnFX
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10450-10439 area should be decent support if it gets there.
Dentalfloss
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hit our 6848 area
scalps in and out
tight stop on bounce
scalps in and out
tight stop on bounce
Dentalfloss
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needs to test 6862 area
Good markup.... where now? Up to 6860, 6880... or 6840
