Weekly Game Plan 25 Nov 19

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. Our best pieces can be found in one placehere. If you want to get an idea for how I trade trends, this webinar will help. If you want to know how I Trade the News, this plan will help. 

Here is this week's Game Plan:

Last week was a cautious one, with risk assets generally finishing the week lower. Despite kind words from Trump and Xi, the relations between the US and China are still not clear: arguments over human rights, Hong Kong and U.S. support for Chinese-claimed Taiwan continue to drag on, and over the weekend Chinese State Councillor Wang Yi added gas to the fire saying that the US is the strongest source of instability!  However, sources reported China will raise penalties for violations of intellectual property rights and look into lowering the threshold for those who steal IP, according to new government guidelines released Sunday.

Themes for the Week Ahead:

• It’s almost all about the US/China Trade Debate: as a Dec. 15 deadline for U.S. tariff hikes approaches, Beijing has reportedly invited top U.S. negotiators to talks. But it might call those off if President Trump signs into law a bill supporting Hong Kong’s pro-democracy protesters or if U.S. warships keep sailing near islands it claims in the South China Sea.
• HK Elections: this election is for District Council positions that wield little power or influence. The significance of the election lies in the context of recent protests against China’s incursions into Hong Kong’s administration. There has been a record turnout (63%).

Data in the Week Ahead:

• GER IFO
• NZD Retail Sales Q/Q
• RBA Lowe Speech
• RBNZ Financial Stability Report
• RBNZ Orr Speech
• US GDP Q/Q
• CAD GDP

On the Radar:

Once again this week everything will hinge on US/China news output. Equities closed the week rather neutral, but especially US equities have attempted to forme a base and so I am not bearish just yet. Aud, Cad and Euro weakness vs. USD and (trade war depending) vs Jpy seem like the clearest bets in FX space. But keep your eyes on the wires again.

Weekly Game Plan 18 Nov 19

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. Our best pieces can be found in one placehere. If you want to get an idea for how I trade trends, this webinar will help. If you want to know how I Trade the News, this plan will help. 

Here is this week's Game Plan:

Last week showed decoupling between US equities (boosted by optimism on the Trade War front) and AsiaPac equities (lower on HK unrest). However, no safe-haven flows were seen just yet. With no developments over the weekend, the markets will likely pick up from where they left off on Friday.

Themes for the Week:

• Trade War: any headlined and developments on the trade war front will take center stage in an otherwise calm week. While equity markets are latching onto any positive headline, the mixed messages from the White House, the mood changes of the US president and the shifting demands from Chinese officials have created an air of uncertainty. With equities sky high, the sensitive side is the downside, if we get negative headlines.
• GBP Sentiment: finally it seems that the Pound is becoming tradable again. From what I'm reading, it seems that so long as Johnson continues to hold his lead in the polls, the Pound will continue it's ascent as traders believe a clear win by the Conservatives should ensure the passage of Johnson’s Brexit deal and end the uncertainty that has plagued the GBP over the past few years.
• Hong Kong: the US Senate could pass the Hong Kong Human Rights and Democracy Act this week that would review Hong Kong’s special status annually. Thus far, Trump has demonstrated no tangible support for Hong Kong’s protestors but if Trump decides to back the bill, it would be seen by China as interference in internal affairs and would potentially imperil trade cooperation.

Data in the Week Ahead:

• RBA Minutes
• CAD CPI
• FOMC Minutes
• ECB Minutes
• BOC's Poloz Speaks
• ECB'S Lagarde Speaks
• EU PMIs
• CAD Retail Sales

On the Radar:

Going into the week, the most evident trade (as it has been for a few weeks now) remains long US equities and EU equities. The recent downside action in AUDNZD may also continue, and small GBP longs vs. Jpy, Eur and Aud may be in favour. Finally, keep an eye on Crude, attempting another break upwards.

Weekly Game Plan 11 Nov 19

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. Our best pieces can be found in one placehere. If you want to get an idea for how I trade trends, this webinar will help. If you want to know how I Trade the News, this plan will help. 

Here is this week's Game Plan:

Trade optimism was the main theme driving the financial markets last week but with conflicting headlines over the weekend, things may be different with Asia opens.  After the markets closed on Friday, White House advisor Navarro told Yahoo Finance that Trump will not roll back tariffs as part of a phase one trade deal. Navarro said the Chinese are trying “to use the western press” to box the US into agreeing to a rollback of some of the existing tariffs, and that “the president is having none of that”. To further complicate the outlook for this week, China inflation data was mixed, with headline CPI rising more than expected while PPI fell more than expected.

Remember that US bond markets  and Canadian markets are closed on Monday.

Themes for the Week:

• Focus remains on fluid status of US-China talks.
• The RBNZ meets this week and the market is pricing in around a 65% chance of a 25 Bp cut to 0.75%.
• Federal Reserve Chair Powell delivers the annual Economic Outlook before the Joint Economic Committee of the US
  Congress on Wednesday. Fedspeak will be abundant this week, above & beyond Powell.
• Bank of Canada Governor Poloz delivers a key note address at the San Francisco Federal Reserve on Thursday night (10pmET) with remarks available fifteen minutes beforehand.

Data in the Week Ahead:

• UK GDP
• NZD Inflation Expectations
• UK Employment Change
• GER ZEW
• RBNZ Decision
• UK CPI
• US CPI
• AU Employment Change
• GER GDP Q/Q
• UK Retail Sales
• US Retail Sales

On the Radar:

Going into the week I remain bullish on US equities in particular. I remain bullish on Crude Oil. I'm bearish on Gold. I'm bullish USD vs Eur and Kiwi.

Weekly Game Plan 4 Nov 19

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. Our best pieces can be found in one placehere. If you want to get an idea for how I trade trends, this webinar will help. If you want to know how I Trade the News, this plan will help. 

Here is this week's Game Plan:

It should be a quiet start to the week with Tokyo on holiday and no market moving news out over the weekend. Last week ended with a risk-on tone after the  "Goldilocks" NFP report...which overshadowed the worse  ISM manufacturing data. Equities closed at the highs, US yields rose but FX was rather muted and the USD eased. The Loonie was the worst performer after a dovish BOC opened the door to a rate cut. In contrast, the Aussie was the best performer after rate cut expectations were diminished.

Themes for the Week:

• US/China Trade War: the US-China trade talks appear to be going well enough to maintain optimism a phase one deal will be agreed to. Just watch out for any tape bombs...
• RBA: the market is giving virtually no chance of another cut so the focus will be on the statement.
• BOE: markets are expecting another non-event as we all await the December election turnout.

Data in the week ahead:

• AU Retail Sales
• RBA Decision
• NZ Employment Q/Q
• BOE Decision
• CAD Employment
• China Trade Balance

On the Radar

Going into this week (a quiet from from a news perspective) I continue to favour longs on Nasdaq, SP500, Dax even...and Crude if we break last week's highs. In FX, I like AUD & NZD longs against USD and Cad. We seem to have broad USD weakness so perhaps Eur longs and Gbp longs might be viable as well.