Last week and last month closed below 66c which is a key level and we've started to see the pullback to 66c, to go and fill the remaining institutional orders.
This will not only be retesting that resistance which was once strong support, but also the broken bear flag and the broken head and shoulders neckline which all forms a massive matrix of confluence for a...
While Congress still needs to pass the debt limit agreement, the debate in the market has shifted to the need for the US Treasury Department (UST) to rapidly rebuild its depleted cash levels.
We have no understanding of the timetable, but already the debate is whether the significant level of Treasury bill issuance will result in a major headwind for global...
Westy and Blake are back with The Trade Off! Macro themes (Sentiment, debt ceiling, China & NFP), juicy charts (Crude, GBPNZD, HK50 &USDCNH) and trade ideas (EURMXN & NASDAQ). Don't miss this episode of The Trade Off!
With month-end flows in mind, and as the market reacts to the weekend debt ceiling agreement and the prospects for ease of passage through the House and Senate this week, the USD remains at the centre of the universe.
The prospect of the Fed hiking in June will get further close attention, where we contrast how US data stacks up relative to the data flow in other...
The momentum is to the USDs back and there are multiple core tailwinds supporting the dollars investment case. I would argue that the USD has become somewhat of a magical currency, where we’re seeing safe-haven flows, as well as a cyclical element, where US data has recently been better than feared.
We can see US economic exceptionalism playing out, while US...
Westy and Blake are back with The Trade Off! Macro themes (Fed policy, the debt ceiling, liquidity cliffs & the USD), juicy charts (DXY, AUDUSD, Gold & Silver) and trade ideas (Long/Short US/EU, USDJPY). Don't miss this episode of The Trade Off!
After an eventful week for the NAS100, US500, JPN225, GER40 and the USD, traders should be open-minded for further twists in the market script this week.
At one stage last week better-than-feared US data and some modestly hawkish Fed chatter saw US interest rate futures price a 40% chance of a hike at the June FOMC meeting - the USD naturally benefited from this...
Westy and Blake are back with The Trade Off! Macro themes (market sentiment, the debt ceiling, USD & is trading gambling?), juicy charts (Gold, USDJPY, Nikkei, EURMXN) and trade ideas (Long/Short US/EU, SPX) - get with it and tune into The Trade Off!
China industrial production (16 May 12:00 AEST) – the market expects a solid improvement in the industrial production read at 10.8%. We also get retail sales (+22%), and fixed asset investment (5.7%) – a big year-on-year improvement shouldn’t surprise given it is measured against a stagnant economy that was in lockdown. However, with China’s data throwing up a...
The ZAR (South African rand) has come up on the radar as sellers have dominated and a true buyers strike ensues. We’re seeing longer-dated South African govt bonds sell off aggressively, with yields on 25yr government debt rising above 12.5% and the highest levels since 2020.
The energy shortage continues to take a toll on economics and talk of increasing...
The fact we are seeing US 2yr Treasury yields confined to a 4.28% to 3.60% range is a major factor behind the DXY trading in such a tight consolidation. On the daily timeframe we see the Bollinger Bands (BB) compress to the tightest levels since Jan 22, with the RSI (9) sitting mid-range – subsequently mean reversion is the correct strategy here and we see clients...
Westy and Blake are back with a massive episode of The Trade Off! Macro themes (equities, PPI, USD & BoE), juicy charts (NASDAQ, Bitcoin, KRE ETF, EURJPY) and trade ideas (EURAUD, USDZAR) - get with it and tune into The Trade Off!
The US debt ceiling should be firmly on the radar and getting an understanding of the risks it poses could help us better recognise the trades which could serve us well.
It is incredibly painful for all market participants, but it can radically alter our trading environment and reverse the low volatility regime, we have found ourselves in recently.
Like most of...
Marquee event risks to navigate:
Debt ceiling headlines – President Biden meets with Congressional leaders on Tuesday to try and inject some urgency in forging an agreement to raise the debt limit before 1 June. We’re already seeing clear stress in US T-bills maturing in mid-June, so the market is certainly taking the threat of moving past the June X-date...
We've recently seen USDSEK consolidate in a descending triangle after a sharp drop from 10.55 highs.
Sellers have been gaining traction as seen from the lower highs each time buyers have bought the 10.23 support.
Market has now broken below 10.23 support and if we get a rounded retest we could see sellers fully dominate and the descending triangle pattern plays...
There are weeks when the landmines by which traders must navigate are seen in such abundance, where the implications for market pricing are so meaningful, that we manage risk well or we simply get schooled - this week seems to be one of these.
As we look down the calendar we see marquee catalysts everywhere – earnings, central bank meetings and tier-one economic...
Traders are looking ahead at the RBA meeting (2 May 14:30 AEST) and reviewing where the balance of risk sits, as well as the propensity for volatility. As always, the need to manage the risks when holding exposures over news is of clear importance.
From a volatility perspective, AUDUSD 1-week (options) implied volatility sits at 11.2% - the 20th percentile of the...
