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Old May 8, 2017, 10:35am   #9
 
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AUDUSD- The cross consolidating at 100WEMA.

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  • AUDUSD has been grinding down for more than two months.
  • The cross down nearly 4.5% from March high’s.
  • AUDUSD low made at 0.7367 consolidating at 61.8 fib (Dec-March rally)
  • AUD remains under pressure amid still-subdued inflation and continued downside risks to iron ore prices.

Fundamental news


Australian building approvals and NAB business confidence scheduled today on Asia trade. Besides, China Trade Balance due.

ANZ– Forecast Residential building approvals fell 5.7% m/m in March.
“ANZ expects that business conditions remained elevated through April, and may nudge higher from already strong levels”.

Westpac– Australia March dwelling approvals (11:30 am AEST) are expected to fall 4% m/m (Bloomberg consensus), consistent with the underlying slowdown.

  • Tuesday, May 09
    - Retail sales forecast 0.3% vs -0.1%
    According to Jo Masters at ANZ, “Retail sales are expected to bounce back somewhat from February’s surprise fall, but the overall picture remains one of challenging times”.
  • Wednesday, May 10
    - Australia Annual budget

China economic events
  • Monday, May 08
    - Trade Balance
    Westpac– Both exports and imports have been growing strongly lately and the trade surplus has been large (>$40bn) aside from in months impacted by the lunar new year holidays.
  • Wednesday, May 10
    - China inflation y/y basis
    Scotiabank: AUD remains the only notable net long.
    Barclays: AUD remains under pressure amid still-subdued inflation and continued downside risks to iron ore prices.
    Societe Generale– A pullback in AUD/USD is underway and the pair could drift towards 0.73, which happens to be the lower limit of a broad triangle.
    Nomura– FX sensitivity to further declines from current levels is likely to increase as terms of trade shifts begin to weigh more heavily on the likes of AUD.

TECHNICAL VIEW


AUDUSD drifts below 100WMA last week manages to close tad above.

The cross holds the 61.8fe on the weekly chart, below this 0.73 exists.

Resistance seems at 0.7440, 0.7490/0.7500 and 0.7560.
Attached Thumbnails
audusdweekly.png  

Last edited by KeyToMarketsUK; May 8, 2017 at 11:31am.
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Old May 9, 2017, 4:28am   #10
 
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KeyToMarketsUK started this thread • Oil is yet to find a bottom.
• Oil nearing capitulation.
• Oil prices have fallen nearly 19% between mid-April to last Friday (May 05).
• On a daily closing basis, oil prices have fallen by around 10% on May 04 and 05.

FUNDAMENTAL NEWS

Concerns over growth in China triggered the sell-off across various assets like copper, iron ore and oil.
The weak China April PMIs show early signs that growth in China is decelerating.

Brent has been trading below 50$ since May 04, for the first time since 30 November 2016, the day of the last OPEC meeting.

OPEC meets in Vienna on 25 May.
Market participants focus on May 25th OPEC meeting. Earlier on November 30, 2016 OPEC reached its first deal to cut oil production since 2008. The deal cut oil production from OPEC members by 1.2 million barrels a day.

OPEC ministers will meet in Vienna on May 25 (Thursday) to review the agreement and potentially extend the oil production cuts, over until the end of 2017.

• According to Alex Lawler and Rania El Gamal at Reuters, “OPEC and non-OPEC oil producers look likely to extend their agreement to limit supplies beyond its June expiry to help clear a glut, three OPEC delegates said on Thursday, downplaying the chance of additional steps such as a bigger cut”.

• According to analysts at Goldman Sachs commodity research, “Oil nearing capitulation “.
The analysts also said, “Given the lack of any significant oil data releases on the day, we see two forces at play in this sell-off:
(1) a follow through on the sharp declines in copper and iron ore the day before on concerns over growth in China, and
(2) once again, the influence of technicals and positioning, this time likely driven by negative gamma
effects and timespread liquidation.”

• According to Mark Ozerov at Goldman Sachs International, “we expect continued inventory draws to push the curve into backwardation, and ultimately lead to a sequential recovery in oil prices”.

Reuters Inside Commodities reported, “Saudi Arabia's energy minister Khalid Al-Falih said on Monday that oil markets were rebalancing after years of oversupply, but that he still expected an OPEC-led deal to cut output during the first half of the year to be extended to all of 2017.The Organization of the Petroleum Exporting Countries (OPEC), of which Saudi Arabia is the de-facto leader, as well as other producers including Russia, pledged to cut output by almost 1.8 million barrels per day (bpd) during the first half of the year to prop up the market. But ongoing high supplies have resulted in crude oil prices falling back below $50 per barrel”.

Drilling activity
According to the latest Baker-Hughes data, US oil drilling activity increased for the 16th consecutive week. The Rotary Rig Count (May 05) rose six to 703 last week was 697.

Positioning
• Standard Chartered Bank- Money managers are more negative on crude oil than at any point since the November 2016 OPEC meeting.
• SEB- IMM data from CFTC’s Commitment of traders report (Apr 26- May 2), Specs scaled down on their net long position for a second straight week. Meanwhile oil prices continued to fall and much sharper than the limited cut in the long position. Continued downscaling expected.

TECHNICAL VIEW

Brent drift to 46.30$ on May 05 Asia session, recovered to 49.29$.
Parallel support finds at 45.90 Nov 29th low below this 45$ Sept 20th low exists.
The price manages to hold the trendlines as shown in the below chart.
Click the image to open in full size.
Fails to hold 45.90, selling accelerates to 45$, 44.20/44$ initially, later 43.50/43.30$ possible.
Daily RSI indicates an oversold position.
Weekly trading range likely to remains between 51$ and 45.90$.
Ahead if the may 25th meeting, potential support finds between 44.20$/44$-43.50/43.30$.
Click the image to open in full size.
For the trading purpose, resistance zone remains between 49.60$ and 49.80$.
Bulls fell comfortable if settles above 50$ mark aims at 50.40$ and 50.80$.
Alternatively, support finds at 48.20/48$, 47.50$ and 46.95$.
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Old May 10, 2017, 3:22am   #11
 
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COPPER- Bargain hunting expected.

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COPPER- Bargain hunting expected.

  • Copper price has been consolidating at 200DEMA for three sessions.
  • Price erases the ten-day descending trendline.
  • Trading at a four-month low, off- 13% from Feb2017 highs.
  • On the weekly chart, 100WEMA finds at 2.47

FUNDAMENTAL NEWS

Standard Chartered: We believe that the refined market will tighten in H2 this year and that China’s net refined import volumes will rebound into mid-year. Ex-China refined copper market likely to tighten from mid-year on higher China import volumes.
Reuters reported, Both Sumitomo Metal and KGHM reported losses and booked writedowns on the project earlier this year, and in March KGHM said the second phase was on hold.
"In the current macro conditions, the second phase has lost sense," KGHM CEO Radoslaw Domagalski-Labedzki said at a news conference in Poland on Monday.
CFTC positions weekly: Speculators holding the COMEX copper futures and options net long positions increased by 11,389 contracts to 51276 contracts, a three-week high.

TECHNICAL VIEW

The Copper price rose 0.20% on Asia trade. After a couple of months losses the price consolidating at a crucial support zone as shown on the best low chart.
U.S dollar rebounds last two days, caps the copper price over near term.

Click the image to open in full size.

Potential support finds at 2.4465 and 2.4710/2.4700.
On the weekly chart, 100WEMA finds at 2.4709, as of now low made at 2.4712.
The price respects the descending falling wedge.
Resistance seems at 2.5550, 2.6000 and 2.6240

Click the image to open in full size.

Fails at support zone 2.4710-2.4700, Jan 2017 low 2.4688 exists.
Selling accelerates below Jan 2017 low, aims at 2.45 it’s 50.0% retracement and it's 61.8% at 2.3540 below these 2.4060 and 2.4000 its 50WMA exists.
Over near term trading range remains between 2.4700/2.4688 and 2.5550.
Trade: We expect the price likely to rebound around 2.4700/2.4688 if not focus shifts to 50.0% and 61.8% retracement levels. Bargain hunting expected.

Last edited by KeyToMarketsUK; May 10, 2017 at 10:31am.
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Old May 11, 2017, 12:36am   #12
 
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Gold: Implied volatility has eased towards 2005 lows.

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Gold: Implied volatility has eased towards 2005 lows.

• Gold price tested the four-month trendline.
• The gold price has a key support level finds at 1200$, but fell below 100DMA.
• Implied volatility has eased towards 2005 lows.
• Gold price increasingly oversold, RSI at 30.
• Past three hikes painted a low for gold prices.

FUNDAMENTAL NEWS

Gold price selling accelerates following FOMC statement (May 03) as a June hike remains a strong possibility.
After three weeks of selling, the daily RSI fell to 30 trading below all daily moving averages. Past three hikes, giving a hint of selling before the FOMC meeting.

Standard Chartered: We have marked to market our gold price forecast, but still expect Q2-2017 to be the strongest quarter for gold.
In a research note Standard Chartered reported, "We are more positive on physical demand for the remainder of the year". In detail, “There were three main takeaways from the Q1-2017 World Gold Council (WGC) Gold Demand Trends report: (1) jewellery demand was weak, but the remainder of the year no longer looks as weak as we had feared at the start of 2017; (2) central bank buying has slowed; (3) the scope for mine supply to grow much more quickly is limited at current price levels”.

According to Michael Riesner and Marc Müller at UBS, “On a very short-term basis we can see a bounce since gold is increasingly oversold but all in a we would see a bounce just as a beginning of abasing process into later May, where we have our next bigger multi-month cycle low projection as a set up for starting its next rally leg into summer”.

TECHNICAL VIEWS

The price settles below four-month ascending trendline, parallel supports remains in focus.
On the weekly chart, 100MA finds at 1209 below these 1199.80 and 1191 exists.

Click the image to open in full size.

On the daily chart, Parallel support finds at 1194.80 and 1180$.
On the monthly chart, 100MA finds at 1197.
Over medium-term, price has a potential support zone remains between 1210 and 1180, we refer this as “buying zone”.

Click the image to open in full size.

In case of deep correction, weekly lower Bollinger band finds at 1160$.
Resistance seems between 1236, 1240 and 1247$.
Bargain hunting expected.
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Old May 12, 2017, 3:48am   #13
 
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April jobs data (May 18) is the key driver to AUD in the coming week.

KeyToMarketsUK started this thread AUDUSD has been consolidating at lower levels for three straight sessions. The cross is trading below all moving averages at all major time frames.

FUNDAMENTAL NEWS


The week ahead
Market participants focus on RBA minutes and April jobs data. From China, Industrial production and fixed asset investments are due.
Mon, May 15
• China Industrial production y/y basis
• Fixed asset investments ytd/y
Tues, May 16
• Minutes of May 2017 Monetary Policy Meeting of the Reserve Bank Board 16 May 2017, 11.30 am AEST.
Wed, May 17
• Wage price index q/q basis
Deutsche Bank: we look for a modest tick-up in wage growth, with the quarterly change to round-up to 0.6%qoq in Q1, though this leaves year-ended wage growth at the low of 1.9%
Thurs, May 18
• April jobs data, the key driver to AUD in the coming week.
Deutsche Bank: we expect an increase in employment of around 20k. Consistent with this, we expect the unemployment rate to move sideways at 5.9%.

Central Banks divergence: RBA likely to remain on hold until 2018 while the Fed hikes rates further.

According to Wells Fargo, "Commodity prices have also become less supportive for the Australian dollar, while Chinese economic developments could have a varying influence on the currency over time. Positioning and technical factors suggest scope for further weakness".
Nomura: Expecting AUD continued underperformance

FX Positioning:
Deutsche Bank: AUD longs were pared (data from May 09).
Wells Fargo: Speculative Australian dollar long positions were pared back to 40,600 in early May from 55,300 in early April. (Source: Bloomberg LP, Wells Fargo Securities)

TECHNICAL VIEWS


Consolidating at lower levels for three straight sessions.
AUDUSD technicals are extremely negative.
Support finds at 0.7360, 0.7330 (50.0 fib Jan-April, 2016 rally) and 0.7300.
Additional support finds at 0.7280 (80.0 fib Dec-March rally).

Click the image to open in full size.

Fails to hold additional support, 0.7200 and 0.7160 (December 2016 low) exists.
Resistance seems at 0.7425, 0.7470 and 0.7500/0.7525
Potential resistance seems at 0.7500/0.7525 and 0.7630100WEMA.
Ahead of the April jobs data, 0.7330 and 0.7280 are the key support level to be in focus.
In case of rebound, 0.7500/0.7525 is the initial target.
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Old May 15, 2017, 6:21am   #14
 
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DXY likely to rebound beyond 61.8% of 101.35-98.50 fall.

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  • The dollar index retraced last week, helped by 50WSMA.
  • Likely to rebound beyond 61.8%.
  • Has formed a five wave decline.
As you see in the below daily chart, the dollar index completed the 5 wave decline in a falling wedge pattern. We expect a near-term bottom has formed, forecast a retracement beyond 100 level.

Click the image to open in full size.

As shown on the daily chart, the dollar index retraces more than 61.8% in the last two occasions. The fifth wave made a low at 98.48 fell from 101.35 (April 10) it’s 61.8% seems at 100.20.

Over near-term potential resistance seems between 100.20 and 100.60 its 100DMA, in between 100.50 exists earlier breakout level (shown on the below weekly chart). The price likely to pause around 100.40 and 100.50, shifts to a consolidation phase before further moving higher through descending daily trendline (black). In this case, 100.90/101 expected.

Click the image to open in full size.

Support finds at 99, 98.70 and 98.50 over near term. In case bulls fail to hold 50WMA finds at 98.50, the daily 100.0 fe at 98 and 97.70 are the potential supports exists.

NUTSHELL-Until the price holds the 50WMA, retracement expected to 100.0 fe on the daily chart seems at 101.00 (blue rectangle).


It is important to always keep in mind the risks involved in trading with leveraged instruments.

What is your Technical View?
Do you have a different idea? Please leave us a comment and get an answer from our professional analysts.

Last edited by KeyToMarketsUK; May 15, 2017 at 6:23am. Reason: Disclaimer
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Old May 15, 2017, 7:08am   #15
 
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Where do you expect the S&P 500 to be by Friday's close ?
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Old May 15, 2017, 9:50am   #16
 
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KeyToMarketsUK started this thread
Quote:
Originally Posted by Pat494 View Post
Where do you expect the S&P 500 to be by Friday's close ?
The price is within a thin range between 3 resistances.

In this week we have 3 economic news on the calendar:
capture.png

Depending on the outcome of this news we could see a breakout and open a position in its direction.

capture2.png
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