Trading with point and figure

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Will it get bought.?

 

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Bounce...Watch to see if 12100 becomes rez

 

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trendline break...and dump

 

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DAX.Unwinding our overbought nicely

 

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in our bounce area

 

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lining up

 

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Turns nasty if our lowest line becomes rez

 

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and bounce

 

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Good Morning: The Long & the Short of it and The Bigger Picture - 8 October 2019 - ADM ISI

Inbox

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Ostwald, Marc

09:00 (24 minutes ago)

to Marc

- Busier day for data & event; digesting Japan Spending & Wages data,
quirky services survey, China Services PMI, German Production, awaiting
US NFIB survey & PPI; BoE, ECB and Fed speakers accompany IMF Georgieva
briefing; bond auctions in Austria, Netherlands, UK & USA

- Germany production: welcome uptick, but surveys suggest more likely to
be a blip

- Japan: Household Spending underlines solid domestic demand, despite
bipolar services survey

- US: NFIB survey seen dropping back, likely to weigh more heavily in Fed
equation than likely neutral PPI, though watch consumer sector prices

- chart: Japan Economy Watchers survey - current vs. outlook

- Audio preview:
https://www.mixcloud.com/MOstwaldADM/adm-isi-morning-call-8-october-2019/

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

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

A much busier schedule of data and events awaits financial markets, even if the very poor UK BRC Retail Sales report was released early yesterday (like for like Sales -1.7% y/y, 12-mth average at new low 0.2% y/y). Statistically there are Japan's wages data, China and Japan services surveys, German and Spanish Industrial Production and French Trade to digest, while ahead lie US PPI & NFIB Small Business Optimism. A bumper day for central bank speakers has BoE's Carney & Cleland, ECB's Lane, Norges Bank's Olsen, and from the Fed: Powell, Evans & Kashkari accompanying IMF's Georgieva - though it seems unlikely that any of them will offer any genuinely fresh insights to policy outlooks. Brexit, US/China Trade talks, Middle East tensions and more domestic political drama around Trump will still be the most likely source of headlines to jar markets, which seem to be drifting back into full financial repression complacency mode, with 'relative value rotation trades' into European equities seemingly 'en vogue', but certainly not triggered by any actual macro- or indeed mirco-economic news. A not inconsequential day for govt bond auctions sees 10 & 30-yr from Austria. 30-yr in the Netherlands, 2036 UK Index-Linekd Gilt and the US kicks off this week's refunding with USD 38 Bln 3-yr. In terms of the overnight run of data, Japan's Household Spending continues to underline that domestic demand remains resilient, even if wage growth is non-existent, thought the Economy Watchers survey offers a very bipolar profile of the economy, with a surge in Current Conditions accompanied by a slide in the Outlook - there is a precedent from 2014, which suggests this is an aberration. China's Caixin Services PMI mirrored the NBS equivalent, and suggests some modest loss of momentum. as for Germany's Industrial Production, while the unexpected gain 0.3% m/m, with July revised up to -0.4% m/m from -0.6% paints a marginally less negative picture, it would be premature to suggest that Q3 GDP might end up eking a small gain, above all given the overwhelming survey and other anecdotal evidence suggesting continued manufacturing weakness.

** U.S.A. - Sept NFIB survey / PPI **
- The risks for today's NFIB survey would appear to be to the downside of an expected small dip to 102.5 from 103.1, both from the aspect of the downbeat ISMs and the already published NFIB Hiring Plans index that has dropped bac to 17 from 20, even if this still leaves that index well contained in the range of the past 30 months. With the Fed emphasizing that policy will be aimed at 'sustaining the expansion', it is arguable that activity data and surveys are rather more important than inflation measures, at least for the time being. Forecasts for PPI at 0.1% m/m for an unchanged 1.8% y/y headline, along with a very average 0.2% m/m core (also unchanged at 2.3%) suggest that there will have to be a major surprise to even vaguely set market hearts aflutter. As ever the "core core" ex-Food, Energy & Trade measure bears most scrutiny, posting a 0.4% m/m rise in August after subdued prints of -0.1% and Flat m/m in prior months. The August 'jump' saw particular pressure in many consumer related elements, which were probably evidence of tariff related pressures.

========================== ** THE DAY AHEAD ** ===========================

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Messy