Yesterdays reversal in the equity US equity market points towards that risk appetite is back.
Calendar
Economic Data Releases
|
|
Country
| Time (GMT)
| Name
| Expectation
| Prior
| Comment
|
UK
| 08:30
| UK GDP QoQ (OCT)
| 0.2
| -0.6
|
|
EC
| 09:00
| Industrial New Orders YoY (AUG)
| -22.5
| -24.3
|
|
US
| 14:00
| Existing Home Sales MoM (SEP)
| 4.9%
| -2.7%
|
|
Earnings Releases
|
|
Country
| Time (GMT) (G(GMT)(GMT)
| Name
| EPS exp.
| EPS prior
| Comment
|
US
| Bf-Mkt
| Honeywell
| 0.716
| 0.740
|
|
US
| Bf-Mkt
| Microsoft
| 0.324
| 0.370
| Important for sentiment
|
US
| 14:00
| Schlumberger
| 0.625
| 0.680
|
|
What's going on?
· Stocks in a strong reversal higher yesterday. The risk-trade is on again. USD and JPY lower and commodities, AUD and EUR higher.
· US 10-year Treasuries threaten to break support at 117-20. That could be an intraday trigger for new highs in stocks.
· The S&P500 trendline resistance today is at 1114.
· Earnings show improvement, but there is an ongoing discussion about the quality of earnings in especially financial shares.
FX
FX
| Daily stance
| Comment
|
EURUSD
| 0/-
| May struggle past 1.5075-00 area. Prefer to sell, stop above 1.5140, target 1.4950 again
|
USDJPY
| 0/-
| Seen capped at 91.70-80 for a retracement back to 91.0, possibly 90.50
|
EURJPY
| 0/-
| Res at 137.85-00 seen holding for a retracement back to 137.0, then 136.60
85-00 seen holding for a retracement
|
GBPUSD
| 0/-
| Prefer to sell rallies to 1.6700-10, stop abv 1.6760. GDP data to determine n/term direction
|
AUDUSD
| 0
| Expect o consolidate below 0.9300. Suggested range 0.9240 – 0.9300
|
FX Options
FX-Options
| Comment
|
EURUSD
| German name seen buying more middle of the curve 10 delta EUR puts for customers.
|
| Buying interests likely to continue so expect vols to be well supported.
|
USDJPY
| Vols have been soft in Asia and as spot moves nearer to 9200, risk reversals have also
|
| eased off. Expect spot to range between 9100-9250 in the near term.
|
AUDUSD
| Curve got given as spot fails to break higher. Even if it does grind to 9300 again, front end
|
| should continue to be offered except for 2 week date which gets the RBA and nonfarm .
|
Equities
Equities
| Daily stance
| Comment
|
DAX
| 0/+
| Buy on dips towards 5819 and target 5880. Stop below 5792.
|
FTSE100
| 0/+
| Buy on dips towards 5255 and target 5298. Stop below 5229.
|
S&P500
| 0/+
| Buy on dips towards 1093 and target 1103. Stop below 1089.
|
Nasdaq100
| 0/+
|
|
DJIA
| 0/+
|
|
Futures
Commodities
| Daily Stance
| Comment
|
Gold
| 0/+
| Buy at the break of 1065 and target 1076. Stop below 1060.
|
Silver
| 0/+
| Buy on dips towards 17.50 and target 17.70. Stop below 17.40.
|
Crude Oil
| 0/-
| Sell on rallies towards 82.50 and target 80.00. Stop above 83.30.
|
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