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A Traders’ Week Ahead Playbook: The tables have turned for riskWhile we await earnings from Nvidia (on 22 May) that will be influential on future market direction, we move into the tail-end of US quarterly earnings, but also past a dovish Fed meeting, a strong US ECI report and weaker-than-expected US nonfarm payrolls and 2 hefty bouts of MoF/BoJ intervention. Yet, despite these landmines, a gentle calm descends over financial markets – early last week the USD was threatening to trend higher, but now momentum shifts to the downside, with US Treasuries finding better buyers, US interest rate markets pricing close to two cuts by year-end, while the VIX index has pulled back to 13.5%, with the S&P500 closing above the 29 April high. By way of significant movers - aside from a lazy 25% w/w fall in Cocoa and a 32% w/w gain in Nat Gas – where NG needs to be on the radar given the breakout and the growing potential for a bullish trend to materialise, we see solid movement in the HK50 (closing 6.9% wow), while Bitcoin has rallied 10% off its lows and is eyeing a move back to the 50-day MA at 65,890. In FX, CADJPY saw the biggest 5-day percentage change, falling 3.6% w/w. The MAG7 equity names look to have regained their mojo, amid solid earnings and some lofty guidance for capex - suggesting growth and innovation remain at the core of their investment thesis, backed by renewed buybacks and some big names even rolling out dividends. China tech is also flying higher, where both Tencent and Alibaba have run hard of late and while overbought should be well supported into weakness. How the tables have turned, and the reassuring view from Fed Chair Jay Powell that policy is still “sufficiently restrictive” and “it’s unlikely the next policy move will be a hike” has reinvigorated the risk bulls. Add in a weaker US ISM services print and a moderation in US nonfarm payrolls (NFP) and the market has gained greater confidence that the US economy is not indeed overheating. Conviction levels may still be low, but the platform is in place for risky assets to move higher this week, notably if truce talks in Gaza gain real traction. Looking ahead and the landmines through which we navigate positions: US data is thin on the ground this coming week, with the senior loan officer survey on bank lending practices really the only economic event risk to be concerned with – traders can trade the KRE ETF (US Regional bank ETF) here and react to markets interpretation of the survey. We also get 11 speeches from Fed members, but until we get the US (April) CPI report on 15 May, I suspect traders will not be too concerned with holding risk over their respective views. It will be a lively week at a central bank level, with the RBA (on hold), BoE (on hold), Swedish Riksbank (skewed to cut), Banxico (cut) and Brazilian Central Bank (50bp cut) all meeting. We should get a 25bp cut in Mexico, with a 50bp cut expected to the Brazilian Selic rate. The RBA meeting and Statement on Monetary policy will get big focus, and while the RBA will almost certainly keep rates at 4.35%, and continue to suggest “the board is not ruling anything in or out”, Aussie swaps price a near 40% chance of a hike by August (see pricing below), so many are expecting a modest shift in their commentary and a clearer roadmap to future hikes – if we don’t see that play out in the wording then we could see the AUD trade lower, notably vs the FX cross rates. The GBP navigates Thursday’s BoE meeting, with the broad consensus expecting a dovish split in the voting and a statement that justifies the view priced into interest rate pricing, where the BoE is expected to embark on its first cut in August. We also get UK Q1 GDP, a speech by BoE Chief Economist Huw Pill and 1-year inflation expectations from the DMP (Decision Makers Panel), and that could be looked at by some in the market. GBPJPY and GBPAUD shorts, EURGBP longs, were the preferred plays last week, and I still favour these staying in these positions. Wednesday’s Riksbank meeting puts the SEK (Swedish krona) firmly in play, with economists split on whether we see the Swedish central bank join the Swiss National Bank in starting its easing cycle. The SEK swaps market implies a 25bp cut at around 80% probability, so those holding SEK short positions will have some concern with that position over this event. The risk-to-reward trade-off favours short NOKSEK over the meeting, but a 25bp cut is a lineball call and as many will attest to, trading over news like this is more of an exercise in risk management, or for those running tactical or special situation strategies. We also see inflation prints in Mexico, Norway, Columbia, Chile, Brazil, and China. Trade data (Thursday – no set time) from China will also get a focus, with imports expected to increase by 4%. In Japan, I guess kudos go to the MoF/BoJ - they hit JPY shorts hard with two bouts on size intervention and as luck would have it, they’ve been given a helping hand from Jay Powell and the first below estimate NFP print since October 2023. Those using the JPY to fund a saturated carry position will almost certainly think twice about using the JPY tactically here in the near term, and until we see a better trend in the US data, or if we see a hotter US CPI print, USDJPY has scope for ¥150. Conversely, on the week, I’d be expecting the upside to be capped at ¥155 and would be selling rallies into ¥155.50. As always, an open mind to market movement (as price will always go to where it wants to go), and a dynamic approach to react will serve you well in this market.
PEPPERSTONE:US500
by Pepperstone
NATGAS My Opinion! SELL! My dear friends, NATGAS looks like it will make a good move, and here are the details: The market is trading on 2.150 pivot level. Bias - Bearish Technical Indicators: Supper Trend generates a clear short signal while Pivot Point HL is currently determining the overall Bearish trend of the market. Goal - 1.994 Recommended Stop Loss - 2.252 About Used Indicators: Pivot points are a great way to identify areas of support and resistance, but they work best when combined with other kinds of technical analysis ——————————— WISH YOU ALL LUCK
NYMEX:NG1!Short
by AnabelSignals
1
NATURAL GAS Can turn bullish on the short-term.Natural Gas (NG1!) has been posting Higher Lows, three so far since the February 20 Low, despite the fact that it remains within a Channel Down since the October 27 2023 High. This might be a short-term trend change similar to the Channel Up that started on the April 14 2023 Low following a sharp and long-term selling sequence. Notice also the Higher Lows Bullish Divergence on the 1D RSI patterns. As long as the bottom of the (dotted) Channel Up holds, we will be bullish short-term, targeting the 1D MA100 (green trend-line) at 2.050. If the bottom of the Channel Down breaks, we will turn bearish, targeting the Lower Lows trend-line at 1.400. The risk is low on both sides. ------------------------------------------------------------------------------- ** Please LIKE 👍, FOLLOW ✅, SHARE 🙌 and COMMENT ✍ if you enjoy this idea! Also share your ideas and charts in the comments section below! This is best way to keep it relevant, support us, keep the content here free and allow the idea to reach as many people as possible. ** ------------------------------------------------------------------------------- 💸💸💸💸💸💸 👇 👇 👇 👇 👇 👇
NYMEX:NG1!
by TradingShot
1
Oil could go to $90 and higher if this happens...Since the eruption of the war between Hamas and Israel in early October 2023, we have been occasionally reporting on some of the developments in the oil-rich region. In one of the more recent articles, we outlined how Israel’s deadly airstrike against Iranian generals in Damascus, Syria, was likely to provoke retaliation from Iran and its proxies. On Saturday, Iran followed through and launched a large-scale attack on Israel. Per media reports, Iran sent approximately 170 drones, 120 ballistic missiles, and 30 cruise missiles, most of which were intercepted outside of Israel’s airspace with the help of Israel’s allies, including the United States. The attack sparked a discussion of retaliatory strike against Iran within Israel’s war cabinet, with officials not being able to agree on a timeline. Initially, it was announced Israel would reciprocate aggression in a window of 24 to 48 hours. However, just shortly before the futures market opened on Monday, Israel’s officials backtracked their plans, noting the country was not looking for significant escalation of the conflict while leaving a possibility of payback on the table. Besides the attack, there was also news concerning Iran’s seizure of the Israel-linked MV MSC Aries cargo ship (operated by Geneva-based Mediterranean Shipping Company and owned by Gortal Shipping) off the Strait of Hormuz. At the moment, it does not seem very probable there will be some sort of disruption to cargo or tankers transiting through the area, but keep in mind that about 21 million barrels per day were transiting through here in 2022, which is about three times more than oil passing through the Red Sea before the start of the Israel-Hamas War. All in all, the geopolitical situation in the region progresses from bad to worse, carrying many unknowns. But judging by how things are unfolding, there is a high chance of a conflict passing beyond a point of no return, which, in turn, has profound implications for the oil market and could see the oil price rise above $90 per barrel (and potentially to the upper $90 per barrel). Illustration 1.01 Illustration 1.01 shows the daily chart of USOIL and simple support/resistance levels derived from past peaks and troughs. Technical analysis Daily time frame = Bullish Weekly time frame = Bullish Please feel free to express your ideas and thoughts in the comment section. DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.
TVC:USOILLong
by Tradersweekly
NATGAS Technical Analysis! BUY! My dear friends, Please, find my technical outlook for NATGAS below: The instrument tests an important psychological level 1.773 Bias - Bullish Technical Indicators: Supper Trend gives a precise Bullish signal, while Pivot Point HL predicts price changes and potential reversals in the market. Target - 1.827 Recommended Stop Loss - 1.739 About Used Indicators: Super-trend indicator is more useful in trending markets where there are clear uptrends and downtrends in price. ——————————— WISH YOU ALL LUCK
NYMEX:NG1!Long
by AnabelSignals
1
NATGAS Technical Analysis! BUY! My dear friends, My technical analysis for NATGAS is below: The market is trading on 1.785 pivot level. Bias - Bullish Technical Indicators: Both Super Trend & Pivot HL indicate a highly probable Bullish continuation. Target - 1.832 About Used Indicators: A pivot point is a technical analysis indicator, or calculations, used to determine the overall trend of the market over different time frames. ——————————— WISH YOU ALL LUCK
NYMEX:NG1!Long
by AnabelSignals
1
Oil unaffected by the Port of Baltimore's closureAfter breaking above the ascending channel and reaching its highest value in nearly six months late last week, the price of West Texas Intermediate crude oil retested the upper bound of the channel during yesterday’s trading session. The outlook continues to look bullish on daily and weekly time frames. Nevertheless, multiple indicators flash overbought signals on the daily chart, implying this might not be the best spot to enter the market on the long side, and instead, it might be preferable to wait for a more substantial correction. While waiting for such an event, we would like to address a recent tragedy in Baltimore that captured national headlines and caused the closure of the Port of Baltimore. Some analysts proclaimed this to be the start of bigger problems for various supply chains. However, despite the event's emotional weight and social implications, its impact on the oil market has been minimal. That is mainly because the port’s imports are not made up of crude oil but rather petroleum-derived products, including biodiesel, asphalt, and numerous fertilizers (along with different non-petroleum products). Therefore, the port does not hold considerable significance to the oil market. Illustration 1.01 Illustration 1.01 shows the daily chart of USOIL and the upward-sloping channel. Technical analysis Daily time frame = Bullish Weekly time frame = Bullish Please feel free to express your ideas and thoughts in the comment section. DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.
TVC:USOILLong
by Tradersweekly
Time for a small pullback before higher price tags?West Texas Intermediate crude oil has increased nearly 20% since the start of 2024 and is currently trading near $86.50 per barrel. The precarious situation in the Red Sea, production cuts by OPEC (and its allies), and the inability of the United States to bring more production online fast enough have greatly contributed to the rising oil prices in the past four months. Going forward, it is unlikely that the geopolitical issues in the Middle East will improve anytime soon, especially following a severe escalation of tensions between Israel and Iran earlier this week when Israel killed two Iranian generals by airstrike in Damascus, Syria (not to mention constant failures in peace negotiations between Hamas and Israel, and Israel’s plans to continue military operations in Gaza). These actions will likely provoke retaliation from Iran in the form of more attacks on Israel through its proxies. As these relationships seem to have entered a spiral of reciprocating aggression, the odds of a huge war spillover continue to grow, which has enormous implications for this oil-rich producing region and the oil market itself. On the subject of technicals, the daily and weekly time frames are bullish. However, the USOIL broke above the ascending channel on Tuesday, and the RSI reached overbought territory on the daily timeframe. Besides that, the price also deviated too far from its 20-day and 50-day SMAs, which increases the chances of a short-term pullback in the price of oil. Nonetheless, the probability of oil reaching $90 per barrel in the coming weeks continues to rise. Illustration 1.01 Illustration 1.01 displays the upward-sloping channel on USOIL’s daily chart. The yellow arrow indicates a breakout above the channel. Illustration 1.02 The chart above illustrates simple support/resistance levels derived from past peaks and troughs. Alternative support levels lay at $85.85, $83.56, and $79.72. Technical analysis Daily time frame = Bullish Weekly time frame = Bullish Please feel free to express your ideas and thoughts in the comment section. DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.
TVC:USOILLong
by Tradersweekly