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Ratehike

AUDUSD - Possible Bearish BreakoutAUDUSD has been trading within an ascending triangle for the majority of this year and a breakout is expected within the next two weeks. With the US Dollar hitting nine month highs earlier this week, a December rate hike is strongly expected which would strengthen the greenback further. Meanwhile, the pressure of a rate cut has eased in Australia after inflation data for the last quarter came out higher than expected at 0.7%. Economic data for Australia throughout the next couple of months will be an important indicator as to whether they will maintain or cut rates. In the US, investors will be focussed on the upcoming election and a possible rate hike in December. We will be watching this pair for a breakout downwards to the 0.715 and 0.68 levels. Alternatively, an upwards breakout could see AUDUSD head towards 0.8.
Short
by priyesh
4
Gold - Long Term TALong term TA supporting my opinion of Gold being bearish ahead of the interest rate increase cycle. November & December FOMC meeting will set the tone. Caution against Italy's referendum on December 4th - Likely to close short before hand and re-take ahead of the December FOMC meeting. Second probability with no rate increase and a dovish guidance will remain short with market stabilization. Reinstating my thesis of $100B's in "safe havens" to be pulled out to put in play in the market.
FX:XAUUSDShort
by TraderDanER
XAUUSD : Review on Various Bull Possiblities.Its been very evident that even the strongest bears went positive since BREXIT on Precious Metals for intermittent rally or pullback from the supercycles as we call. Everybody would agree that 1300-1310 would serve as strong demand area and resistance from previous tops especially March 2015 highs. The breach woud open the gate to 12XX and bear would take thier chance to push down as much as possible it can. Probably 1250-1211 would be bears targeting for. On current Daily Chart I see huge range play from 1300-1330 for next whole week and I believe this the last bear week and will make perfect Bull Flag on weekly. We have bottomed the STOCH and RSI hover around 48-50 on daily. So Huge Sideways possible within range till 27 July, Yellen still might not give green signal to rate hikes in august as statisticians or Economists would treat previous two NFP data as Anomaolies and would wait for more evidence on job reports. Dovish stand likely to induce rally in all PM and would again try to target previous tops and 1375-1390 Region. I have charted all bull possiblites, if not anyone of those being played, God help the bulls !! because it will dive down so hard that even bear has not imagine. Good Luck for Next Week Happy Trading.
FX:XAUUSD
by robus
1
Financials will benefit if the reflation theme continuesRelated to the reflation theme described in my view "Crude Oil: The Most Important Chart in the World". This trade relates to a steepening of the US yield curve as rates adjust upwards through either rising inflation or a pickup in US growth (or both) having been driven to a record low in June. BKX Index (candles) BKX / SPX (blue) US10Y (grey) What is interesting to note from a technical perspective is that the BKX index traded within 1% of the 2007 - 2009 61.8% retracement level last July, before bottoming at the 38.2% retracement level in February this year. Since then, yields have continued to fall (grey), but the relative performance of banks versus the S&P 500 (blue) has held firmer and failed to make new lows. Assuming the reflation theme transpires, banks represent a compelling value play and remain an uncrowded US equity play. Now trading below the $70 level, technically the banks are in the lower half of the last 12 month's trading range and provide a decent payoff in the run up to $80 (61.8% level) with a stop-on-close (weekly) below $57 (38.2%). For further insight and discussion please contact me via Tradingview or LinkedIn , on Twitter @James_LVDTA, and visit www.lexvandam.com to become a member of our Trading Club.
BLong
by JamesHelliwell
DXY/ USD: FOMC - GS 65% 2016 RATE HIKE; RABO ONE 2016 RATE HIKEGoldman Sachs on July FOMC Decision : - The run of positive economic news in recent weeks has coincided with generally dovish comments from Fed offcials. Policymakers have indicated that they are not “behind the curve”, and have expressed increased uncertainty about the neutral level of interest rates. We would treat recent comments with caution, however, as we have not heard formal remarks from the Fed'€'s leadership. - Taken together, we see recent economic data and the public comments from Fed officials as consistent with only modest changes to the FOMC statement. We think the committee will upgrade its discussion of the labour market and measures of inflation expectations, but change little else. The period between the July and September meetings will include a number of important data releases as well as the annual Jackson Hole conference. Therefore, policymakers will have an incentive to keep their options open, and plenty of opportunities to guide market expectations, should they need to. - We continue to see a 25% chance that the committee will raise the funds rate in September and a 40% chance that it will do so in December - implying a roughly two thirds probability of at least one rate increase this year. RaboBank on July FOMC Decision: -While the Fed is in a wait-and-see mode to assess the threats to the global outlook and the strength of domestic momentum, recent US data have boosted the Fed;€™s confidence. We expect the Fed to squeeze in one rate hike before the end of the year, most likely in December.
TVC:DXYLong
by QuantumLogicTrading
SHORT GBPUSD: CENTRAL BANK EXPECTATIONS - BOE/ ECB/ BOJ & FOMCReuters Analyst Expectations: FOMC 1. IMPROVING DATA POINT TO SEPTEMBER RATE HIKE - - The Fed is very unlikely to spring any surprises at the upcoming FOMC meeting, which concludes next Wednesday 27th July, but a September rate hike is a distinct possibility. The statement next week should acknowledge the apparent pick-up in second-quarter GDP growth, particularly the recent strength of consumption, and also the rebound in employment growth in June. The Fed won't commit itself to a September rate hike at the July meeting, however, hints will be eyed closely. - Currently the 30 day federal funds rate option implied probability is consistant with the increasing chances of a September/ Novemeber hike view as the probability continues to increase to new post brexit highs e.g. 25bps FOMC hike probability for Sept/ Nov/ Dec increased to 24.6%, 25.7%, 41.6% from 18.8%, 20.2% and 39.5% yesterday. With Dec now pricing 2 hikes at 9.1% up from 7.1% - as risk markets continue to set new highs increasing confidence. BOE 1. BOE SEEN CUTTING BANK RATE 25 BPS TO 0.25% IN AUGUST - BoE Seen Restarting QE In August, Top Up With GBP80Bln adding to GBP375bn - Median 60% Chance Of UK Recession In The Coming Year - UK Economy Seen Growing 1.4% In 2016, 0.6% In 2017 (Prev Seen 1.9%, 2.1%) - Short Sterling constant 3m Libor Option Implied cut probabilities remained flat on the day at 30% chance of a 25bps cut - however risk markets rally buoy hawkish expectations though this is fundamentally expected to impact the BOE decision since markets are rallying as a function of the BOE cutting (its a loop that the BOE will be aware of). ECB/ BOJ 1. ECB not seen to cut rates but some analysts think there may be an extension to the maturity of ECB's APP e.g. further into 2017, though the purchase amounts is not expected to change at EUR80bln a month - nonetheless a 3m extension is an extra EUR240bn and a 6m is EUR480bn, so such an announcement on Thursday would certainly continue to fuel the rally in risk markets. 2. BOJ - there is less consensus on the BOJ meeting on the 28th, though the forecasts seem to sit between a 10-20bps cut to the key rate + an extension to the ETF purchases (Maturity and monthly purchase amounts) + an extension to the JGB purchases (maturity and monthly purchase amounts) - a BOJ surprise to the upside would undoubtably enable risk markets to continue to rally, though if it goes the other way (Kuroda underdelivers) this could be the impetus to stop the risk rally in its tracks. Trading Strategy: 1. Short GBPUSD on Pullbacks to 1.33/4 (if we see any now - unlikely but possible if retail sales outperform and the market prices the strong CPI/Employment at the same time) - 1.305TP1 1.285TP2 1.25xxTP3. - I posted this trade a few days ago when the short price was favourable - at these levels i DO NOT advise shorting. 1.33 is the minimum entry - I just posted this as a short confirmation/ central bank watch post. 2. The above supports the short GBPUSD play as 1) Easing from ECB/ BOJ puts pressure on the BOE to ease (as the GBP appreciates against the JPY/ EUR in this situation which is deflationairy) thus BOJ/ ECB easing increases the already consensus view that the BOE will ease - a BOE easing of 25bps cut and 80bn extension to the QE would certainly move us through 1.25. Infact I believe the 25bps cut alone is enough to do that. If BOE delivers £80bn in QE then that will move GBP even lower to perhaps 1.20/23. - Further, on the FOMC stance, a more hawkish FED strengthens the long dollar leg of the short GBPUSD which compounds the momentum that GBPUSD can move lower as we move towards two drivers vs just the one with the BOE easing. We now have BOE easing potential combined with ever increasing FOMC hike expectations fuelling USD demand which in turn/ combined will send GBP$ lower faster.
Short
by QuantumLogicTrading
3
SHORT GBPUSD @1.34 - BOE MINUTES HIGHLIGHTS - EXPECT AUGUST CUTAs expected BOE stood pat on their rate decision reiterating much of which was said last week by Gov M. Carney, the need for more analysis to be done is/ was key - " "Detailed Analysis" of All Policy Options Required" and "Extent Of Additional Stimulus Will Depend on August Forecasts". IMO the notes were very bearish and almost but 100% chance of some sort of action in August - "Most MPC Members Expect To Loosen Policy In August". Given Brexit, and the Inflation conditions in the UK anyway a cut of the Bank Rate, if only for 12ms, makes sense to ensure a smooth transition - especially as the UK welcomes a new PM & the article 50/ Brexit negotiations are yet to get underway, this will undoubtably put some pressure on the UK economy, where much of which could be smoothed by a 25bps rate cut. The minutes did point out interestingly that ""In the Short Run" Weaker GBP Will Boost Inflation" which makes sense, however they coupled this statement with "BOE Agents Report Some Businesses Delaying Investment", so the net impact of the Brexit event on inflation is yet to be seen. Overall IMO the decision to hold Policy still in July was as expected however, given the median analyst had forecasted a 25bps cut, this "hawkish" response imo has opened up a beter oppourtunity to sell GBP, as in the medium-term/ post the Aug decsion GBP$ is likely to trade below the 1.28 lows, with many analysts forecasting GBP$ somewhere between 1.20-1.25. Trading Strategy: 1. Short 1@1.34/335, sell 2@1.38/9 TP1 1.305; TP2 1.285 TP3 1.25XX. - I personally will not be operating SL on this trade as i believe BOE will cut in August 90%, and/or GBP$ will fall at somepoint on pure speculation, and/or as FOMC rate expectations continue to increase going into the later stages of the year. 2. Shorting any GBP rallies vs USD is also a good strategy from now on into the Aug rate cut, especially above 1.34. *In the unlikely event GBP$ trades higher on the back of this e.g. to 1.38/9 then i still advise shorting, however, given how stable cable was trading into the event (and after the event) i dont expect much short headwinds now - you could tell the market didnt actually believe in the rate cut/ money wasnt behind the rate cut as GBP$ rose to its post brexit highs at 1.33... is that how a cross should react when money is actually backing a cut? BOE Rate Cut/ Minutes Highlights: Bank of England Leaves Bank Rate Unchanged At 0.5% Bank Of England Leaves Bank Rate Unchanged At 0.5% BOE Jul Minutes: MPC Voted 8-1 to Maintain Bank Rate at 0.5% BOE Jul Minutes: 8 Voted to Keep Rate Unchanged BOE Jul Minutes: 1 Members Voted to Increase Rate BOE Vlieghe Voted to Lower Bank Rate to 0.25% BOE: Most MPC Members Expect To Loosen Policy In August BOE: MPC Members Had "Initial Exchange" on "Various Possible Packages" BOE: Extent Of Additional Stimulus Will Depend on August Forecasts BOE: "Detailed Analysis" of All Policy Options Required BOE: "In the Short Run" Weaker GBP Will Boost Inflation BOE: Longer-Term Outlook Depends on Inflation Expectations BOE: Economic Activity Likely to Weaken in Wake of Brexit Vote BOE Agents Report Some Businesses Delaying Investment, Hiring Decisions
Short
by QuantumLogicTrading
3
GNW - recovering fortune 500 giant, turnaround play of the yearGNW recovery play, Long at 3.08 as of 6/14/2016, target 6.50 or more by this time next year. GNW was hit by horrible guidance and earnings the previous year and is just starting to recover since the last earnings early May. It has stopped the bleeding in its LTC unit and is poised to make a turnaround. Rate hikes should help GNW as well. 82% of stock float is held by institutions and mutual funds, and multiple firms have been picking up position in the stock the last quarter. The current tradable float is small and will be very volatile on low volume. I'm long Jan 2017- 5 strike calls. Looking for 5 by September
NYSE:GNWLong
by profprof
Gold on the rally after perfect pullbackContinuing from the previous analysis, we have seen a pullback for support right on the major rising lower trendline @ ~1200. From there, a rapid inversion of the expectations for a fed rate hike have caused the dollar to fall and have risen the precious metal. There is no guarantee that this will keep going as full scale risk aversion hasn't yet kicked in. Short term possible targets are: 1257.75 and then possibly into a solid resistance at ~ 1272
FX:XAUUSDLong
by LotsOfLore
USOIL: Top is probably inI've shorted at the price on chart, as announced at Tim West's KHL chatroom today. Seems like the top is in for a few months, probably for the year. We can enter short at market if not in, but keep a wide stop, or add (or wait to enter) if we hit 46.66 today. www.tradingview.com www.tradingview.com If interested in my trading signals, or in personal tuition, contact me privately. I'm offering a considerable discount on a packaged course which includes access to my private trading signals list for a year. Cheers, Link to Tim West's chatroom: www.tradingview.com We discuss setups like this often there. Feel free to stop by and subscribe to his indicator pack. If you have any questions ask.
FX:USOILShort
by IvanLabrie
16
Pound Sterling and CABLE WEAKNESS is Signaling Monetary SurpriseRE: Global Macro Update Regarding European Union, #ECB, and UK The way the #Euro is strengthening relative to the Pound, and particularly the way the #CABLE $GBPUSD cross-rate is falling out of bed is about to unleash shock-waves of negative #sentiment through the European Euro STOXX Equity Markets $FEZ. According to RunningAlpha.com Capital Markets Intelligence, this currency market action is portending a monetary surprise announcement; and any rate hike in Europe to stem a soon to be out of control falling CABLE would backfire, as it would just put dangerous downward pressure on UK's GDP and Britain's Industrial production, ultimately further weakening the #Pound #Sterling Best regards, Efrem -- Looking for better times ahead in the USA after this initial start of the year shock in USA equity markets abates in the not too distant future ( as indicated in prior memos at Running Alpha.com; as the situation rapidly deteriorates in Europe, capital will likely migrates out of Europe into the USA in earnest.
FX:SPX500Short
by runningalpha
DXY: Interesting weekly shortThis is a follow up trade to my prediction of the top for the Dollar. Check related ideas for my previous forecast. We have a very good trade setup here and the target and expected ETA is on chart. The lackluster reaction to the Fed's rate hike and the current sentiment readings make me think that this trade setup is of high probability, making it an ideal trade to take asap. When fundamentals and technicals align, we get the best results. Good luck! Ivan Labrie.
TVC:DXYShort
by IvanLabrie
12