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Strange last week, the OPEC decision & near futureThe reasons for the markets getting out of “hibernation” are an active news background interspersed with the news. Recall, it was launched by Trump's decision to impose tariffs on steel from Argentina and Brazil and at the same time accuse these countries of currency manipulation. What was perceived by us as an expansion of the trade war and a possible beginning of the currency war. Well, the week ended with the publication of statistics on the US labour market, as well as the completion of the OPEC meeting. Let's start with statistics on the US labour market. Honestly, it surprised us. The numbers came out abnormally high for the current reality of the US economy (+ 266K with a forecast + 180K). Also, the unemployment rate fell to its record low marks (3.5%). The growth of the dollar against the backdrop of such excellent data was logical. But, given the anomalous nature of the given data, we would not be in a hurry to conclude. At least one more confirmation is needed that + 266K is not a coincidence, but a pattern. So on Monday, we will rely on local profit-taking in the dollar after Friday's growth, and therefore we will look for points for its sales. Note that on Friday our recommendation for news trading in the USDCAD worked out perfectly: excellent US data overlapped with bad figures on the Canadian labour market, as a result, the USDCAD soared by 100 points. Perhaps the most important event in terms of the consequences of the past week was OPEC’s decision to further reduce oil production from 1.2 million to 1.7 million from January 1, 2020. So, we can talk about the OPEC + agreement №3 (recall, the first one, provided for a reduction of 1.8 million barrels, the second one 1.2 million barrels per day). At the same time, Saudi Arabia made an unexpected statement of readiness on its part to further reduce production by another 400 thousand b / d. That is, the total reduction may reach 2.1 million barrels. This is the highest reduction since the cartel's attempts to stabilize the situation in the oil market. Despite the rather modest oil growth on Friday, such an outcome of the OPEC meeting is a very strong bullish signal. So this week, we will look for points for oil purchases. It would seem that after such a busy week the markets need a break, but you should not count on it. This week promises to be even more volatile. Key events are the announcement of the Fed decision on monetary policy parameters in the US, the ECB in the Eurozone, as well as elections in the UK. And although both events seem relatively predictable, there is enough time for surprises. How to make money on each of this news we will write a bit later. As for our positions, we do not see any reason to change our basic strategy (except oil). Therefore, we will continue to buy safe-haven assets (gold is simply perfectly substituted), sell the dollar, and this week we will actively build up a long position on the pound - the victory of conservatives in the UK parliamentary elections will have to hit the pound higher. we will buy oil.
Long
by Trade24Fx
1
Getting ready for the Bank of Canada decisionAs we announced, the demand for safe-haven assets increased significantly this week, which provoked both an increase in gold quotes and a strengthening of the Japanese yen. And if the reason for this was an increase in tariffs on imports to the United States of aluminium and steel from Argentina and Brazil on Monday, then on Tuesday Trump intimidated to introduce an additional 15% of tariffs on Chinese imports in the amount of $ 160 billion on December 15. At the same time, he added that he was not in a hurry and the best time to conclude a trade deal was generally after the 2020 elections. Of course, Trump should not be taken seriously, such his comments are a clear attempt to force China to be more accommodating in the negotiations. Nevertheless, the reaction of investors can be understood. Given that gold may easily grow (50-70 dollars per ounce), it is likely that yesterday's growth is only the beginning. So we continue to recommend looking for points of purchase for safe-haven assets. It is worth noting the decision of the Reserve Bank of Australia to leave the rate unchanged, which is generally a positive sign for the Australian dollar. Although its growth potential so far seems limited, it could still grow (50-70 pips), especially against the background of a weak dollar. US employment data from ADP traditionally published on the eve of official statistics is what we are waiting for. Although the level of correlation between ADP and NFP data is insignificant, strong deviations of the data from forecasts may well be flustrating to the markets. The Bank of Canada will announce its decision on monetary policy parameters. We expect the current status quo to be saved. But a change in the nature of the rhetoric of the Central Bank may well provoke a jump in volatility. Recall that our position on the Canadian dollar is to buy. That is, selling a USDCAD above 1.33 is, in our opinion, a great trading idea. The oil market is getting ready for the OPEC meeting. Globally, we remain supporters of oil sales. But for now, until the end of the week we take a break - the meeting may well surprise, but betting on red or black is not our approach, we prefer to work with facts.
Short
by Trade24Fx
ridethepig | BRLMXN 2020 Macro MapA timely update to my Latam charts as we approach year-end. The bullish BRL theme I have maintained all year long is starting to attract a lot of interest with the idiosyncratic pension reform. Macro data in Brazil is showing signs of finding a floor and BCB have confirmed the end of the easing cycle: Those with more conservative hands looking to ride this for the long term can comfortably lean on BRL with carry exposure now capped. MXN is showing no signs of improvement and remains as uncertain as ever, whenever I talk to clients on the topic they speak of concerns around Mexico risk and the dovish Banxico weighing on the MXN carry. If you ask me we are going to see a major flop in policy from Banxico and with Brazil set to recover on all fronts it remains a strategic long in all my LATAM portfolios. This is not a quick 50-100 pip trade where we are shooting blanks hoping one lands, rather this is trading a major macro flow with +11% upside. Highly recommend all to find a way to find a way to benefit from these flows, the only downside is coming from growth momentum in Brazil fading (unlikely) and overshoots in Mexico (also highly unlikely). Good luck those on the buy side.
Long
by ridethepig
Ibovespa Termina Retração e Mira nos 120 Mil pontosPrezados, O estudo utiliza conceitos de Ondas de Elliot, Fibonnaci, LInhas de tendência e outros idéias de Fundamentos que servem de alicerce para projetar uma alta. ---Aspectos Fundamentais--- Ao falarmos de Economia temos um Brasil reduzindo seus juros a patamares mínimos históricos, o que obriga as pessoas a buscarem novos investimentos com riscos maiores para buscar um retorno razoável -->Positivo Com esse pensamento, não só falamos que mais pessoas investiriam em ações, assim como mais fundos de investimento teriam capital para aportar em projetos e investir em empresas, em suma: Há um bom momento para a Economia brasileira. --> Positivo. Agenda Liberal acabou de passar, temos a Previdência passando, o que geram certa folga nas contas públicas, grande problema da Gestão atual. --> Positivo. Privatizações estão sendo estudadas e realizadas, atuando mais uma vez na dor formada pelo déficit público atual --> Positivo Lado negativo: Trade War entre Eua X China está desacelerando a economia global, até aonde isso vai? -> Negativo Curva de juros dos EUA invertida, recessão pode vir em menos de 1 ano -> Negativo (qual será o impacto em uma possível crise dos EUA?) -----Análise Técnica ---- Ao observamos a dinâmica dos preços, percebemos claramente o desenho destacado na análise. IBOV acabou de concluir a retração de uma onda 1, respeitando claramente os níveis de Fibonnacci (o que também ocorreu na primeira leva 1-5 e, posteriormente, na ABC). Estamos sobre uma Linha de Tendência de Alta (LTA) e sobre nossas Médias Móveis Exponenciais, que servem de apoio para a continuidade da subida. A onda 3 tem como projeção quase os 120 mil pontos e, posteriormente poderemos passar perto dos 130 Mil pontos. Essa análise tem um viés educativo. Gerencie seu próprio risco.
BMFBOVESPA:IBOVLong
by Tassolago
IBOVESPA Historical AnalysisThe following analysis is informative in a fundamentalist way. I also highlight that in TA Bias, the best purchase occurred in the touch on EMA200 (perfect) I highlight how political factors are clearly seen in the stock market. Also note that EXPECTATION is the one that runs the stock market, so if you look at market expectations and how an exchange expectation will influence the market, you will make a lot more money than actually watching the news. Remember that the Lula government begins with giving a favorable speech to businessmen, saying that Brazil needed them very much at this time (note that previously he had a hate speech against businessmen, which is why the market feared his candidacy). We then highlight the Subprime Crisis that has affected the world globally, but while it has affected us here, it has not affected our tendency to improve internal conditions for investment and development. Next, the highlight the change of government and as the political crisis in Dilma Government begins to precarize our national scenario, lack of confidence in the international scenario increases. Here we clearly see the scenario of EXPECTATIONS, where the movement of Impeachment reflects in the stock market before it happens FACT, that is, the market already priced the fact before. Note that there is political tension in the last elections, and the stock market falls as Haddad gained ground in election polls. The market turns when the Bolsonaro takes the stab, at the same time the dollar reverses (uptrend) and falls sharply in the coming weeks. The stock market has started to rise ever since, with Bolsonaro gaining ground in polls and winning the elections (priced earlier). At the moment, the market suffers from risk aversion of the international investor. Trade War has been intensified. Trump X EDF in heavy clash. But we have a very positive view for the Brazilian Stock Market and we may aim to 30% or more of upside momentum.
BMFBOVESPA:IBOVEducation
by Tassolago
Brazilian Stocks Market ready to take off? 20% upside potential Hello, This is the Study of Brazilian Stock market Index - IBOV The study uses concepts from Elliot Waves, Fibonnaci, Trendlines, and other Fundamentals that serve as a foundation for us in order to believe in an upside. --- Fundamentals --- When we talk about economics we have a Brazil reducing its interest rates (SELIC) to historical minimum levels, which forces people to seek new investments with higher risks to seek a reasonable return -> Positive With this thought, we not only said that more people would invest in stocks, but more investment funds would have capital to invest in projects and companies. There is a good time for the Brazilian economy. -> Positive. Liberal Agenda just passed, we have the Social Security passing, which generates some slack in public accounts, the big problem of current management. -> Positive. Privatizations are being studied and performed, once again acting on the pain formed by the current public deficit -> Positive Negative side: Trade War between USA and China is slowing the global economy, where does it go? -> Negative Reversed US yield curve, the recession could come in less than 1 year -> Negative (what will be the impact on a possible US crisis?) -----Technical analysis ---- Looking at price dynamics, we clearly see the design highlighted in the analysis. IBOV has just completed the retraction of a wave 1, clearly respecting Fibonacci levels (which also occurred in first wave 1-5 and later in ABC). We are on an uptrend line (LTA) and our Exponential Moving Averages, which support the continuity of the climb. Wave 3 is projected at almost 120,000 points, and later we can pass close to 130,000 points. This analysis has an educational bias. Manage your own risk.
BMFBOVESPA:IBOVLong
by Tassolago
EWZ: Viking is back in townI've been working for 5 hours to estimate the trend turns for the next six months. To gain the knowledge to do those five hours are countless. Now, it will not be 100 % accurate in timing. I still have a lot of cycle work to be completed to fine-tune. But it will be quite accurate as I have gone back in time and checked out what EWZ has done in the past. And since the past tells us about the future as history repeats, confidence level is high. Please allow a day or two on each side of the green bars. Price is a different story. I have no clue how to deal with that. But its better to know when price can turn than how high it can go, if you catch my drift?
AMEX:EWZLong
by UnknownUnicorn540299
$EWZ $BVSP $IBOV Brazilian Stocks Under PressureWith market volatility back in the global markets with a vengeance, and the US Dollar remaining strong, one EM equity market that has been hit particularly hard this year has been the Brazilian Stocks (EWZ). Sluggish growth forecasts, combined with waning support for the Brazilian President, has sent Brazilian Stocks to its lowest level of the year so far, down -2.94%. The sharp declines have also been fueled by uncertainty over the US-China trade talks on a macro level. The combination of these two forces, the external macro headwinds and weak domestic economy, have both been a perfect storm for the under-performance of Brazilian stocks in 2019 thus far. Furthermore, on a technical basis, the EWZ continues to show deterioration within the equity market, with the 50-day EMA acting as a strong resistance March 2019 and the price action failing to break above since then. We believe that is these headwinds continue, there will be more downside for Brazilian stocks to come. We caution investors against this equity market.
AMEX:EWZShort
by EconomicsGlobal
$USDBRL $EWZ $BVSP - Brazilian Real Under PressureAs market volatility has come back with a vengeance and the US Dollar continues to remain strong, one EM currency that has been hit particularly hard this year has been the Brazilian Real ($USDBRL). Sluggish growth forecasts, coupled with waning support for the Brazilian President has sent the Brazilian Real to its lowest level of the year thus far. The sharp declines have also been fueled by uncertainty over the US-China trade talks on the macro level. The combination of the two forces, the external macro headwinds and feeble domestic economy, have been a perfect storm for the under-performance of the $USDBRL in 2019. Further more, on a technical basis, the $USDBRL continues to show deterioration within the Brazilian Real, with the 10-day EMA being a strong support for the currency pair. We believe if this continues, $USDBRL 4.25 is the next stop.
Long
by EconomicsGlobal