Trading with point and figure

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Plenty there..... Not for me..... Lol

 

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Lining up

 

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23800 area lining up for a pump or dump

 

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More

 

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Still out shopping
Missing it all.... Lol

 

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Get profits

 

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Xmas shopping all finished now
missed it all

 

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Mornin folks

 

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Dow getttin supported

 

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23127 area ...poss in for a hammerin

 

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DAX
10600 we marked a few days ago

 

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NAZ 100

 

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Dow over last 24 hours

 

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Good Morning: The Long & the Short of it and The Bigger Picture - 20 December 2018 - ADM ISI

Ostwald, Marc
08:51 (1 hour ago)

to Marc





- Digesting Fed, BoJ and Riksbank policy meetings, awaiting BoE and CNB;
UK Retail Sales, US Jobless Claims and Philly Fed Manufacturing top
data schedule, as attention swings to tomorrow's "quadruple witching"

- UK Retail Sales: modest bounce expected after October drop, underlying
trend still sluggish, some downside risks

- Riksbank: a 'dovish hike'?

- FOMC: Fed best characterized as less hawkish, rather than turning dovish,
market and Fed rate trajectories still highly divergent

..........................................................................

********************
** EVENTS PREVIEW **
********************

Following on from the FOMC meeting, today has a further raft of central bank meetings, with the BoJ forecast tweaks to be digested ahead of the BoE and Riksbank, and policy meetings in Taiwan, Indonesia, Czech Republic (CNB) and Mexico, while Brazil's BCB publishes its quarterly inflation report. Statistically there are the Australia labour data to digest ahead of UK Retail Sales and the CBI Retail Trades survey and US weekly jobless Claims and Philly Fed Manufacturing survey. UK Retail Sales have been rather sluggish after the summer 'sugar rush', and are seen recovering only modestly at 0.3% m/m after a sharper than expected -0.5% m/m in October, effectively echoing the BRC and Visa Consumer Spending data, though the anecdotal evidence from the retail sector does suggest some downside risks.

** U.K. - MPC meeting **
- No change in rates or the overall volume of QE is expected, which given the uncertainties with regard to Brexit outcomes is wholly unsurprising, and additionally renders assumptions about future policy rather redundant. As such this month's meeting is effectively a case of the MPC going through the motions, and perhaps making some observations about recent activity data having been lacklustre, and probably sounding some optimism on wage growth.

** Sweden / Czech Rep. - Rate decisions **
- Sweden's Riksbank has for much of H2 2018 touted an initial rate hike either this month or in February 2019, and has finally delivered with a 25 bps rate hike to -0.25% while at the same time cutting its rate trajectory, with the repo rate now seen at 0.48% in Q4 2020 (vs. prior 0.66%), and 0.98% in Q4 2021 (vs. prior 1.23%), and indicating that the next rate hike will likely occur in H2 2020). Perhaps most importantly, it noted that while inflation has been below forecasts recently, it is likely that it will remain around the 2.0% target level going forward, and thet the need for 'expansionary monetary policy has decreased slightly. While markets had expected no change at this meeting, the move is not a major surprise, and while there was an initial spike higher for the SEK vs the EUR in reaction, it is at the time of writing a little weaker on the day, no doubt reflecting the lowered rate trajectory. While the Czech National Bank is obviously not a major central bank, it has to be applauded for managing to hike rates by a cumulative 170 bps to 1.75% over the past 18 months, without seeing any outsized gains in the CZK, and the economy maintaining a steady pace of growth (despite the economy's sizeable exposure to the European auto sector). No change is expected at this meeting, but with the CZK not appreciating as the CNB had expected, further rate hikes in H1 2019 seem very probable.

** U.S.A. / Japan - post Fed / BoJ Thoughts **
- The FOCM dashed market hopes of a decisively more dovish tone, delivering the expected 25 bps rate hike to 2.25%-2.0%, and via its dot plot signalling a marginally lower rate trajectory, which now sees two rate hikes in 2019, as against three previously, and it also reduced median long run 'neutral rate to 2.75% from 3.0% (which was in fact where the neutral rate was pegged in December 2017). In terms of its economic forecasts, there were small reductions to 2019 projections for GDP now 2.3% from 2.5%, and headline PCE deflator to 1.9% from 2.0% and core to 2.0% from 2.1%, with Powell noting inflation had turned out a little weaker than expected. Powell underlined that there was a 'fairly high degree of uncertainty on the rate path' and that while most of the FOMC see the economy "doing well in 2019", it 'may not be as kind to our (FOMC) forecasts in 2019." He was also emphatic in saying that the Fed's balance sheet reduction programme (aka QT) has been 'smooth', served its purpose and he does NOT see the Fed changing their balance sheet policy. The end conclusion is very simply that the FOMC is a little less hawkish than they were in Q3, but in no way dovish, even if they are ultra 'data dependent'. Have markets got the message? Not really, the current 'throw all the toys out of the pram' mentality appears to be getting further traction, and remarkably the market is no longer pricing in any rate hikes in 2019, and only a 50/50 chance of a hike in January 2020. As for the BoJ, there were absolutely no surprises from Kuroda & Co, sticking to the line that its QQE programme will remain in place until inflation gets back towards target, though without specifying when that might be, expressing relative confidence on the domestic economic outlook, while underlining the threat posed by global trade tensions. He also noted that the BoJ had no problems with 10-yr yields dipping into negative territory, as long as it remained in range of 0.0% +/-20 bps, and that it would continue to be flexible in terms of QQE asset purchases.

 

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spx into the open

 

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there really is a great mass of rez looming