Intraday Market Thoughts Archives

هل من الممكن أن نرى الداوجونز يصل إلى مستويات 28000؟ وأن نرى مستويات 12500 للداكس الألماني؟ لنناقش هذه الاحتمالات سوياً في هذا الفيديو الحصري

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As global indices deepen their ascent into the green for the year, the path of least resistance appears increasingly to be for higher upside. Volatility is low, the US economy is appropriately neither too hot, nor too cool and the Federal Reserve appears to be more preoccupied with dealing with Trump's non-banking appointees than about raising or cutting interest rates. One case in point is the DAX30 index. After having completed a spectacular head-&-shoulder formation (predicted back in October for our subscribers and again in November in 5:40 mins of this video), the index is set to retest 12200 as a minimal upside target. But what comes next? 12500, or even 12700 are equally plausible. Three contributing ingredients emerge from the following: Oil made a flawless 50% increase from its December lows and shows no signs of exhaustion (RSI & stochastics appear decently positioned), while bond yields are rising from a very..very low point. Finally, the US dollar repeats its pattern of rebounding off the range lows but failing to break above key resistance. Two weeks ago, we said on this piece that April was the best month for equities. 12 days into the month and the pattern remains intact. Earlier today, a new Premium trade was posted for subscribers backed by 2 charts and 5 notes.

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Key messages from the Fed and ECB were delivered in completely different fashion on Wednesday, with important implications for the market. The EU has decided to extend Brexit til October 31st, a proposal that will have to be approved by British Parliament. More central bank talk is coming in the day ahead. Market volumes wind down as traders unoficially start a long weekend ahead of the Easter & Passover holidays over the next 2 weeks. 6 out of the existing 8 Premium trades are currently in the green. 5 in currencies, 2 in commodities and 1 in crypto.

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Sometimes central banks are subtle, other times they are straight forward. Once in awhile both happen on the same day and that was the story on Wednesday.

The message from the FOMC Minutes was a completely clear impression that the Fed doesn't know what's going to happen next and does not have a notable bias. The text said the majority saw rates on hold through 2019 and that patience is needed. They said time would be needed to assess if Q1 weakness spills into Q2.

As Ashraf summarized: “We could hike, we could cut, but in truth we'd like to believe we've reached equilibrium. Leave us alone and don't expect us to hike during elections.”

Draghi meanwhile was playing a different game. He characterized the meeting as one where the Governing Council acknowledged Eurozone economic weakness and that it will extend through the rest of the year. He said the base-line was only to act if negative contingencies developed. He, however, repeatedly emphasized that all options were available if needed.

The message here was much more subtle. He was saying (to paraphrase), 'don't bet against the eurozone because if there is a deterioration, we are ready, we still have ammo.' He has undoubtedly seen the buildup in spec positions against the euro and the worries about European financials. The question is: Will the market call his bluff?

Looking ahead, we hear from the Fed's Clarida and Bullard in the day ahead. Clarida spoke on Tuesday but didn't touch on the outlook. There has been some shifting towards a more-constructive tone among Fed speakers in the past week, we will watch if that continues. Even a hard commitment to the sidelines poses upside risks for the dollar with the market pricing in a 58% chance of a cut before year end.

Another central banker to watch is the BOC's Wilkins. Canadian data has been far better than expectations so far this year but the outlook is plagued by growth worries abroad and expectations that the Q1 blip isn't going to last. The market certainly hasn't rewarded CAD lately but that could change if oil continues to rise and data continues to beat.

ينتظر متداولي الاسواق ثلاثة أحداث مهمة في وقت لاحق اليوم. المؤتمر الصحفي من البنك المركزي الأوروبي ، وقرار الاتحاد الأوروبي بشأن تمديد خروج بريطانيا من الاتحاد الأوروبي ومحضر اجتماع الاحتياطي الفدرالي.التحليل المفصل.

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Wednesday's FX & Indices levels are back to where they stood 24 hrs ago but a busy schedule today will make for meaningful price action. The monthly ECB press conference and FOMC minutes from the March meeting are due at 13:30 and 19:00 London time respectively (GMT is now 1 hour behind London). US CPI is also due at 13:30. A new trade was posted yesterday with detailed chart & rationale. UK GDP and industrial production beat forecasts but GBP is focused on the EU's decision regarding Brexit extension.

(فيديو للمشتركين) إغتنام فرصة المحضر

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The EU is pushing for a March 30, 2020 Brexit extension in what would be another blow to Conservative party unity but it would calm some UK economic nerves and likely aid the pound. But critical details are yet to be scrutinized as it could imply a flexible, allowing an earlier withdrawal.

So far EU leaders have been accommodative – at least in public – to the endless tomfoolery from UK parliament but there is no guarantee their patience won't run out. By the same token, Theresa May is on her last legs as PM and a victory for her would be a miracle but not impossible. There was short-lived rumor of a 5-year cap on the Brexit backstop Tuesday, but it was denied swiftly. Even with that, she would have a tough time cobbling together enough votes to pass her deal.

Today's ECB decision/press conference won't be as captivating as last month but there is some intrigue. Draghi will be grilled on TLTRO details but is likely to punt until June. The market mover is likely to be the assessment and commentary on the economy. Risks are still to the downside and Italy cut its GDP forecast to just 0.2% on Tuesday but will Draghi still hold out hope for an H2 rebound? The latest reading from the Eurozone's Economic Surprise Index by Citi is at -51.80, its highest since March 22, besting its US counterpart of -55.70. 

Technically, the euro held 1.1180 last week and that's the key level to watch.

On the US side, CPI is a top-tier data point to watch but it's tough to see it jarring the market unless it's a significant miss. Inflation pressures are muted.

The Fed minutes could be a bigger market mover. The latest comments from policymakers suggest more of a hawkish bias than the market is currently pricing. If they emphasize that in the minutes and economic data solidifies for a few months, there is a risk of a rethink (and the risk-off mode that will come with it).