FX Markets are generally choppy and uninspiring right now although Sterling may be breaking away to the topside against both the US$ and the Euro.
The stock markets continue to rise but are showing sign of increasing bearish divergence.
WTI has nor or less reached our $60pb target but may head on towards $65…so there are plenty of opportunites ahead this week…
Economic data highlights will include:
Mon: NZ Business PMI, Japan Q4 GDP, Industrial Production, Capacity Utilisation, EU Trade Balance, Industrial Production, BuBa Monthly Report, China NY, US Presidents Day Holiday
Tue: NZ Visitor Arrivals, RBA Minutes, Australian New Home Sales, German/EU ZEW Economic Sentiment Survey, EU Q4 GDP, US New York State Empire Mfg Index, Global Dairy Trade Index
Wed: Australian Leading Indicator, RBA’s Kent; Speech, Japan Trade Balance, UK CPI, PPI, RPI, US Retail Sales, PPI, Capacity Utilisation, Business Inventories, NAHB Housing Market Index, API Weekly Crude Oil Stock Inventory, FOMC Minutes
Thur: Australian Unemployment, ECB Minutes, US Building Permits, Housing Starts, Philadelphia Fed Mfg Survey, weekly jobless claims, EIA Weekly Crude Stocks Change, Speeches; Fed’s Brainard, ECB’s Schnabel,
Fri: NZ PPI, Global Mfg/Services/Composite Flash PMIs (Australia, China, Japan, EU, UK, US)
Market moves, in brief:
FX: DXY 90.48 (+0.07%)
Bonds: US10Y; 1.215% (+4.00%), German 10Y; -0.428% (+6.53%), UK 10Y; +0.520% (+11.25%), Australian 10Y; 1.229% (+2.49%), NZ 10Y; 1.312% (-0.06 %), China 10Y; 3.241% (—%)
Stock Indices: DJI; +0.09%, S+P; +0.47%, NASDAQ; +0.79%, EUStoxx50; +0.65%, FTSE100; +0.94%, Shanghai Composite; –%, ASX200SPI: -0.02%
Metals: Gold $1824 oz (-0.07%), Silver $27.36 oz (+1.42%), Copper $3.788 lb (+0.44%), Iron Ore $160.80 per tonne (NYMEX) (-0.19%),
Oil: WTI $59.61 pb (+2.99%)
Trend Table: February 15, 2021
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In the trend table below, when looking at the charts for a particular FX pair, index or commodity, we are we searching for 2 or 3 consecutive boxes of the same colour which might indicate a trend – and a possible trading opportunity. Consecutive (1 & 4 hour, 4 hour/daily, daily/weekly) green boxes indicate a possible short/medium/long term uptrend; red, a possible downtrend, while blue signifies a neutral bias (range trade possibility). The boxes on the trend table merely replicate the look of the charts for the specific time-frame in MT4/5. Assets with a mixture of colours are pretty much ignored as choppy conditions seem likely to prevail.
For instance, if we see consecutive green boxes in the 1 hour and 4 hour time-frames for the FX pair “EURUSD”, that would signify the chance of a move higher in that pair over the next 24 hours. If the dailies were also green that would add to the bullish conviction from a slightly longer term perspective, and if the weeklies are also green then it would give added credence to the longer term bullish view, albeit that it might take longer for the trend to play out, so patience will almost certainly be required. The opposite would be true of red boxes, which could signify downward momentum. The strength of any possible trend depends on the time-frame, with the longer term (daily, weekly charts) obviously having a greater overall weighting than the short-term charts.
In the near term though, the 1 and 4 hour charts are what are likely to combine to indicate the possibility of a trading idea for the next few, possibly up to 24, hours.
Note that a longer term bullish view (green daily/weekly boxes) does not discount the possibility of near term dips (i.e. Red 1 & 4 hour boxes), which may indicate near term weakness and suggesting that we should be looking to buy dips for a longer term rally – and vice versa if the near term boxes are green and the longer term; red.
|1 Hour||Neutral – Turning Higher?||Turning Lower||Up||Neutral – Turning Lower?||Neutral – Turning Higher?||Turning Higher|
|4 Hour||Turning Lower?||Turning Higher||Turning Higher?||Turning Higher?||Neutral – Turning Higher?||Neutral – Turning Lower?|
|1 Day||Turning Higher?||Turning Lower?||Neutral – Turning Higher?||Neutral – Turning Lower?||Turning Neutral||Turning Neutral|
|1 Week||Possible Topping Formation||Neutral – Turning Higher?||Turning Higher||Possible Basing Formation||Possible Topping Formation||Possible Topping Formation|
|1 Hour||Turning Lower||Turning Higher?||Neutral – Turning Higher?||Turning Higher?||Turning Neutral||Up|
|4 Hour||Neutral – Turning Higher?||Neutral – Turning Higher?||Turning Neutral||Neutral – Turning Lower?||Neutral||Turning Higher?|
|1 Day||Neutral – Turning Lower?||Neutral – Turning Higher?||Turning Neutral||Neutral – Turning Lower?||Turning Neutral||Turning Higher|
|1 Week||Possible Basing Formation||Up – Overbought||Possible Topping Formation||Down||Turning Neutral||Turning Higher|
|1 Hour||Turning Neutral||Turning Lower||Turning Neutral||Turning Higher?||Turning Lower||Neutral – Turning Lower?|
|4 Hour||Neutral||Turning Neutral||Turning Neutral||Turning Neutral||Neutral – Turning Lower?||Possible Topping Formation|
|1 Day||Turning Neutral||Neutral – Turning Lower?||Turning Neutral||Turning Neutral||Turning Neutral||Neutral – Turning Higher?|
|1 Week||Turning Neutral||Neutral – Turning Lower?||Turning Neutral||Turning Higher?||Turning Lower||Turning Neutral|