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Results: 971 to 980 of 1,000
Results: 971 to 980 of 1,000
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Intraday Market Thought: Soros' Reflexivity gone too far
by Ashraf Laidi | Dec 4, 2015 20:21
Evidence of Soros' Theory of Reflexivity remaining prevalent in....Simply put, the euro soared 4% due to misplaced and unfulfilled market....The crowding out of euro-short algos was pivotal in the magnitude of the....But questioning the intensity of euro shorts deserves more time and attention....Question your Expectations, not the Central Bank Decision....Many who were “angry” at the Fed's decision to not raise rates....I will not go into detail about how the ECB gave no reason to expect QE....That was the work of one or two major bank economist's forecasts, who were....My colleague Adam Button and I made it clear in several Intraday Market....Markets went too far with embracing the notion of “policy divergence”....Once corrected by the ECB, the result was massive...At the end of day, anyone who landed on planet euro and saw the spike in the....Not at all...It was all expectations' fault...As George Soros postulated in his version of Reflexivity Theory into....Once the basis of those expectations is altered (ECB's policy actions), the....Friday's Draghi Speech not so different from Thursday's....Some say expectations were fed by the central bankers themselves...Not at all (again)....Today's Draghi speech in NY appears to be the main catalyst behind the 2%....The main reason to the rally is attributed to Draghi's statement....It may not matter that Draghi made a similar statement at yesterday's....e...more measures would/could be implemented if the need arose...One day seems to be too late for traders who lost money, but not too late to....nbsp;....A similar situation occurred on September 24, when Fed chair Yellen made....Markets bottomed three sessions later...Undoubtedly, Draghi's power of words continues to hold sway...But since pulling the QE trigger in March, the timing of the words becomes....This is no longer September 2012, when “we'll do what it takes”....One other Small Detail....One overlooked item from Thursday's press conference, which Draghi did not....This implies that, further measures prior to end of Q1 2016 are highly....Not to forget--the ECB's QE has had positive results, according to ECB....6% lows despite prolonged oil declines, improved growth and rising M3)....Thus, any rise in QE size before April is out of the question...Another 10-bp rate cut could may not be considered before June...nbsp; More evidence that EURUSD parity is far from reality.
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Article: China’s crashing imports assure more CNY depreciation
by Ashraf Laidi | Feb 9, 2015 17:09
The 19% y/y slump in China's trade was the biggest decline since May 2009....nbsp; The plunge in imports was the primary driver behind the new record....3%, posting their first decline in 10 months...Disappointing China figures ahead of G20 meetings are far from rare, but the....Cant' blame it on the goat....Chinese data divergences in January and February are usually dismissed as being....nbsp; But this year's New Year holiday (Year of the Goat) isn't....And the recent consistency of the decline in Chinese imports–not....nbsp; Later this month, the HK trade figures will reveal whether China's....Further CNY weakness is inevitable....Further yuan weakness is the only solution for stabilizing the prolonged....It is no longer the case that US lawmakers have the political capital and....The IMF views China's currency to be more appropriately valued, while US....The case for further CNY weakness ahead is not only highlighted by the glaring....The ongoing divergence between the PBOC's USDCNY reference rate and....Most likely the former option will prevail as Beijing adopts the free....Tonight's China CPI & PPI support CNY weakness ahead of G20....Tuesday's release of January inflation figures from China are....1% y/y from December's 1...5% y/y, which would be the lowest level since the 0...6% attained in November 2009...January PPI, already down 3...3% in December, is seen falling 3...3%– the 34th consecutive monthly contraction–longer than anything....The figures will be another signal from Beijing to ease monetary policy via..
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Intraday Market Thought: Third Avenue Blockade, Beijing FX Coup
by Ashraf Laidi | Dec 11, 2015 21:25
Another market tumble stands in the way of the Fed's artificial....China's announcement earlier today that it had officially launched a new....Although the announcement did not entail an outright devaluation or an expansion....0% daily trading band, markets have interpreted the changes as an easier....The publication of the new basket removes the yuan from being principally....Either way, China's currency will have to depreciate further-not only due....So far, CNY has fallen by only 7% against JPY over the past five months...More CNY declines lie ahead and Monday's (and Tuesday's) fixing will be....Third Avenue Blockade for High-Yield Seekers....The day's biggest headline emerged from the credit front, as US high-yield....The fund announced that the only way to fulfil investor withdrawals would have....As in 2007-8, skeletons have a way to drop off investment funds closets...If Third Avenue sustained nearly $1 bn of redemptions in the 11 months ending....46 bn in withdrawals from all high-yield funds last week, then what would happen....Whether these junk bond funds are energy-related or not, the situation remains....Our stance of expecting no Fed hike in 2015 may have turned unsustainable as....With the ECB decision and strong NFP report behind us, both the US dollar and....That's NOT what these markets are supposed to look like five days before....Regardless of the Fed's outcome next week, were already looking past the..
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Article: US Jobs Catch up with Reality
by Ashraf Laidi | May 6, 2016 18:36
Not much has changed in USD trading since our March post...Today's neutral-to-negative US jobs report will not do the job to sway the....April payrolls rose by 160K (vs exp 200K), the lowest in 7 months after a 208K....The revisions of the prior 2 months were -19K...The unemployment held at 5%, while the participation rate fell to 62...8% from 63...0%, its first decline in 9 months...The number of people going from being outside the labour force to being....The positives in the report were the 2...5% y/y rise in average hourly earnings y after 2...3% in March and the increase in average weekly hours to 34...5 from 34...4...Other decent signs were the 171K increase in private payrolls vs the 11K....Despite the recent improvement in hourly earnings, the 2...5% y/y rate remains well below the 3...5% levels seen in the pre-crisis highs...That is unlike, the unemployment rate, which is near the pre-crisis lows...The chart above shows how easily-beaten corporate earnings were able to lift the....But the last 2 weeks have seen a normalisation as equities fell back in....Jobs are the last to know....One point worth noting, often repeated in my tweets is that labour markets may....As firms retrench, they usually start with capex reduction (trilling R&D,....Thus, the divergence between weak economic activity and robust employment....Fed's Inflation-Employment Considerations....The big debate inside the Fed remains whether the US economy has reached or is....The problem is that with core PCE price index (Fed's preferred inflation....6% y/y in March from 1...7%, inflation may return near the Fed's 2...0% target...Other measures of inflation (driven by bond market expectations) have stalled....64% late last month, the highest seen since July 2015...nbsp; Fed members in Yellen's camp have long expressed the importance of....At this point, both factors require further improvement, while foreign risks....The aforementioned inflation/jobs dynamics are most crucial for reading....But let's not also forget the broadening weakness in US macro....5%, the lowest in 2 years...The probability of Fed June hike has now fallen to 2% from 10% prior the reports&....Stocks have peaked nearly 3 weeks ago after a 16% rally driven mostly by stock-....For the trading-oriented market participants, we issued a trade in....Finally, the bottom chart from the American Association of Individual....The bullish-bearish spread never broke above its key resistance lebvel, which..
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Intraday Market Thought: GBP Traders Turn to UK Court Hearings on Brexit
by Ashraf Laidi | Dec 5, 2016 6:50
A crucial court case this week will decide whether UK...Prime Minister Theresa May must call a parliamentary vote before triggering....nbsp; The Court decision is not about whether the Parliament will reject....The process starts next March...Last month, the British pound rallied against all currencies after a case....In the next 4 days, the UK government's top legal experts will seek to....The UK govt lawyers will argue that the June Referendum to take Britain out of....The Supreme Court will decide in January...The most important reason PM May wants to avoid the Parliamentary vote is the....nbsp; May is attempting to keep tight control on the divorce proceedings,....May has pledged to trigger Article 50 by the end of March, and is seeking to....UK ministers argue for the executive privilege, which is known in the UK...as royal prerogative – allowing the government to bypass lawmakers in....This will be an important opportunity for Theresa May to demonstrate she is a....European Union versus the Single Market....Some MPs who voted for the UK to remain in the EU in June say that if Parliament....The single market joins the 28-member EU with Norway, Iceland and Liechtenstein....But PM May has refused to commit to keeping Britain in the single market or....Another reason that PM May oppose a vote in Parliament is the longstanding....If the Supreme Court decides to give Parliament the green light to vote on....How will the Court Hearing Impact the British Pound?....Any indications that the hearings are moving in the direction to maintain last....nbsp; If on the other hand the UK govt lawyers present strong arguments for....nbsp; ....Once again, it is important for readers to understand that the Court ruling is....If the Supreme Court rules that last month's High Court decision is to be....The Supreme Court will make its ruling in January.
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Intraday Market Thought: Yellen, Gold and Aussie Jobs
by Adam Button | May 7, 2014 23:43Day 1 of Yellen's testimony failed to provide any fireworks but the market....The US dollar was the top performer on the day while NZD lagged...The focus now shifts to the Australian jobs report...nbsp;In today's Premium Insights, we issued a trade on GBPUSD w/ 2 charts....Our AUDUSD and AUDNZD trades are also in progress ahead of tonight's Aussie....For the other Premium trades, they can be found the Premium Insights...Yellen followed up the optimistic FOMC statement by noting a pickup in the....There was nothing in her testimony to suggest a rush to raise rates and the....US 10-year yields continue to flirt with the 2014 lows and that 2...568% level is probably the most important support line in all of markets....The low today was 2...575%....One spot of positive news on inflation was the Q1 US labor cost report showing....2% compared to 2...6% expected...Unfortunately the rise came on falling productivity...Together it points to a weather-related skew but it's something to watch in....We wrote yesterday about the inability of gold to rally when the dollar was....That proved to be a signal as gold fell $18 Wednesday on very light USD....The 100-day moving average at $1285 caught the latest move and that's a....Up next is the Australian jobs report at 0130 GMT...Unemployment is expected at 5...9% from 5...8% with 8...8K jobs created...The full-time/part-time breakdown is always an important component of the....nbsp;....The other highlight of the session is Chinese trade balance at 0200 GMT...The surplus/deficit is less important than rises in imports and exports, which....0% and 2...1% respectively. -
Intraday Market Thought: Is Canada in Recession Already?
by Adam Button | Jun 30, 2015 22:53The Greek drama continues but we change gears today and take a closer look at....We also look at the quarter and Japanese Tankan report due later...On Tuesday, the Aussie was the top performer while its kiwi cousin lagged...nbsp; A new EUR trade was added to the Premium Insights, with 3 charts....Our long AUDNZD from 1...1100 is 280 pips in the green and nears its final target...The market moving news on Tuesday was Canadian GDP...It's April data so it's a bit stale but that didn't stop a more....Growth contracted 0...1% compared to +0...1% expected...That left year-over-year growth at 1...2% compared to 1...5% expected...USD/CAD was trading at 1...2360 and finished the day at 1...2485, despite a 1% rally in oil prices...The pair closed at the highest since June 3...The move may be overdone given the lag in the data, quarter-end and other flows....The Canadian economy contracted at a 0...6% annualized pace in Q1 and contracting growth in the first month of Q2 raises....The OIS market went form pricing a 25% chance of a cut by year-end to a 60%....BOC Gov Poloz's defining characteristic in the past few months....There isn't enough evidence yet but if Canadian numbers continue to....Looking at Q2, the pound was the top G10 currency after election nerves were....The kiwi was the worst performer on the heels of a surprise rate cut...In stock markets, China was tops but the volatility has been extraordinary...The average trading range so far this week is 11%....Another market that performed well was Japan...That was partially on a weak currency but the economy has also been solid...Today features a critical look at what's next with the Q2 Tankan at 2350 GMT...The large manufacturing index is expected steady at 12 with the outlook....nbsp; Another spot to watch is the All Large Industry CAPEX metric; it's....3% in a critical sign of investment from Japanese companies. -
Intraday Market Thought: Empire Fed, Retail Sales, Industrial Production all miss
by Ashraf Laidi | Sep 15, 2015 18:39
A trifecta of misses in today's US economic releases may not be a game-....The September Empire Fed survey posted another double digit decline to remain....3% to miss expectations for the sixth consecutive month and industrial....4% in August to post seven declines over the past eight months—the worst....On the bright side, core retail sales (excluding autos, gas and building....In the Fed's Empire survey, the employment component turned negative to....2 from 1...8, as did the average workweek plunging 10...3 from -1...8...US industrial production was battered by the usual strong US dollar story and....Manufacturing dropped 0...5%, mining fell 0...6% and utilities were up 0...6%....Bearish Argument....The bearish side may argue against the robust retail sales by indicating the....The argument becomes especially potent following Friday's release of the....Thus, the release of US September retail sales, due in mid-October (2 weeks....Bullish Argument....A more optimistic interpretation of the figures could point to the fact that the....Not only manufacturing accounts for shrinking part of the overall US economy,....nbsp;....This leaves us with tomorrow's release of US August CPI for and....Fed watchers are already hedging themselves in their prediction for the....While we lean towards expecting no change this week, markets have already....nbsp;..
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Intraday Market Thought: Why China is Snookered for the Moment
by Adam Button | Jan 4, 2016 23:05
A round of risk aversion that started in China went global in a dismal start to....The yen led the way and commodity currencies lagged in a classic flight to....BoJ governor Kuroda speaks later but the focus is on Chinese stock markets...After closing the Premium Insight's GBPJPY short at a 395-pip gain, a new....There isn't a simple explanation for the Monday's 7% plunge in Shanghai....Yuan weakness and the softer Caixin PMI were widely cited but the expiration of....On July 8, Chinese securities regulators banned senior management from selling....That's set to expire on January 8 and the selling now may be in....That could mean more selling to come and the PBOC may not be able to fight it...On Dec 30 the PBOC's chief economist wrote that policymakers should improve....He said officials needed to do a better job of keeping financial stability in....That may mean the PBOC will want to signal a move before acting...Now the PBOC will look like it's reacting to markets if it cuts...That was the case in August and it was interpreted as a sign that the economy....The PBOC wouldn't want to be blamed for a second rout so they may play it....While China grabbed the main headlines, there were some critical developments in....German HICP in December was 0...2% y/y compared to +0...4% expected...That knocked the euro to the lowest since the ECB...In the US, construction spending was far weaker than expected and the ISM....Markets finished 2015 in a complacent mood about the economy but they may have....In the short term, the swings in China may come quickly...ETFs suggest more Chinese stock selling early but it will be a minute-to-minute....Expect USD/CNY to be fixed around 6...60/63 from 6...50 at 0115 GMT...It's a large move and the market still poorly grasps the mechanics of the....The other event on the calendar is Kuroda at 0710 GMT.
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Intraday Market Thought: China's Yuan Holds Markets Hostage
by Ashraf Laidi | Jan 8, 2016 20:25
Whether this week's violent moves in global equities are the main reason....The US jobs report did show a disappointing 2...5% y/y in average earnings –a reflection of lasting slack in the pool....Some economists claim that a recovery in average hourly earnings is just a....They may be disregarding the quality of these jobs (retail, hospitality and....You want a free currency? Careful....This week, every trader learned a new reality in intermarket dynamics: The....The process has been especially striking as Chinese markets shut for the 2nd day....The West had long demanded China to free its currency from artificial weakness,....The yuan's SDR era is coinciding with broadening weakness in the world&....Last month's decline of more than $100bn in China's FX reserves is a....Beijing is really trying, but free markets is also synonymous to further....More interest rate cuts in China are inevitable, and additional CNY weakness....The Fed could always flex its muscle and deliver a cosmetic hike in the Fed....25%, which is meaningless for monetary policy as long as not a single cent of....4 trillion in bonds is sold...So think twice before you go on about policy divergence...There are currently 6 Premium trades in progress (5 in the green 1 in the red)....This week, we closed GBPJPY and DAX shorts for a cumulative total of 1,005..
