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Gekko
 

Strange times But remember The Joker once served as the Iranian ambassador for the United Nations.

Stock Market Record Highs, Bank of England and Jobs

The Week That Was:

The week ended with record highs on US equity markets and rebounding oil and natural gas prices powered by a dovish Fed cutting rates, a robust US jobs report for October, earnings from tech giants, Amazon.com, Apple, Microsoft, Alphabet and Facebook all showing increases in revenue beyond analysts’ expectations. Apple continued to hit all time highs and the highest US undex beta stocks dragged the markets up further.

Alphabet, Amazon and Apple all increased research and development. Big oil beat expectations with Exxon and Chevron reporting. There were big losses however with specualtive names such as GrubHub, Etsy and WWE all getting hit hard from 20 to 50% instantly. Pick your bets investors! The market shrugged off Brexit, impeachment and geopolitical powder keg risk and Fed injecting 60 Billion into the system to maintain liquidity, in its not QE4 program.

Poltically we have the growing antagonistic and partisan split of the impeachment of the POTUS, in the UK and Europe we have the daily Brexit No Deal on or off

Oil popped despite the risk of record US Production and IEA, EIA and OPEC all lowering demand forecasts  overhanging. On oil remember that it had dropped $13 or twenty percent after speculators bet wrongly on the biggest move since 1991 after Houthi rebels from Yemen launched successful drone attacks on the world's biggest petroleum processing facility in Saudi Arabia in less than 2 weeks  

The U.S. started a 15% tariff on about $110 billion in apparel, footwear and other Chinese imports last month, with same duty on the balance of almost $300 billion in toys, phones and laptops and other products delayed until Dec. 15. The levy was held back from increasing on that already in effect on $250 billion in other Chinese goods to 30% from 25% on Oct. 1, the 70th anniversary of the founding of the People's Republic of China in the phase one trade deal.

Given the history, markets seem overly optimistic about trade, some would say negligently. The market wants to believe the trade war is constructive, we have warned for over a year about the nonsense of the trade war nearing an end. Very simply you have two different cultures two different political systems and shaming doesn't do well in either.

We still have confusion with the whole mess that is Brexit though Italy's political situation improved. Negative rates, as foolish as history will remember them are the theme of the moment.

This is a market full of players that think its different this time, sure its different negative rates all around, trillions of worthless debt, unstable politics and Central Bankers putting their thumb in their mouths and seeing which way the wind blows. The fear of missing out and blind partisan politcs creates intertesting bed fellows. Be alert and put your ear plugs in and watch the whole spectrum its all related, geopolitical, debt markets, commodities, stocks, herds, greed and entitlement,

The spectre of Deutschbank overhangs Europe as does the new British PM, Boris Johnson. Their are other spectres out their we just don't know it, or want to.

"Negative yields on long-dated government securities are more reflective of distorted market conditions than of stronger sovereign credit profiles, Fitch Ratings says. Lower interest service costs support sovereign creditworthiness, but this must be weighed against the impact of the economic conditions leading to lower yields and historically high government debt levels in a number of countries.- Fitch"

The indices are gamed by a few high delta stocks leading the way with massive leverage and a game of chicken on daily.  Apple surging to record highs Friday as earnings were greeted with enthusiasm.

We remind you to stay on your toes, ad nauseum we repeat; In this surreal world that market prices can only go up, with bizzare acceptance that we can't go down and you are a fool if you think otherwise. We have had mixed economic data, no concrete decision on the China and EU trade wars and now a fresh election in the U.K. Here we are (see what ya wanna see).

The Week Ahead

Another big week for potential volatility with the he market spotlight on the Bank of England meeting on policy ahead of the next British general elections on 12 December. We also have on Monday IHS Markit's UK services sector Purchasing Managers' Index. October foreign trade figures in China are due out on Friday, will they confirm the recent upbeat reading on Chinese manufacturing sector conditions?

Back on trade we get the US trade report Tuesday and a preliminary reading on the University of Michigan's US consumer confidence survey for November on Friday we alo IHS Markit's services sector PMI reports for October. The U.S. politically remains combustible, led by Democrat impeachment, Turkey, Iran and Saudi moves, trade wars and repo rates. The market continues to focus on "phase one" of the  U.S. China trade talks.

Watch for the MBA mortgage report also it has had huge swings each week and is key to the economy and homebuilders. In the U.S. investors will be watching data that can help us gauge trade war fallout.

U.S. goods are more expensive due to a stronger dollar boosted by geopolitical woes and negative interest rates in Europe. The dollar index hit a 29-month high on Sept. 3. Investors are also transfixed by oil prices in reaction to the Saudi attack and recovery and military respsonses.

  • Monday  German and EU PMI Manufacturing, US Factory Orders and UK PMI Construction
  • Tuesday  ISM Non-Manufacturing (Services) & Composite PMI from the US, EU, UK and Germany. EU Producer Price Index and UK Balance of Trade
  • Wednesday German Factory Orders and PMI Service, EU Retail Sales, UK Halifax House Price Index, EIA Crude Oil Inventories
  • Thursday German Industrial Production, BoE Interest Rate Decision, US Consumer Credit, Initial Jobless Claims, EIA Natural Gas Storage
  • Friday German Balance of Trade and Current Account, U.S. U. of Michigan Confidence (Prelim), Wholesales Inventories, Baker Hughes Oil Rig Count, CFTC Speculative net positions

To repeat AGAIN ...With the trade war, most analysts still say a US-China trade deal will remain out of reach regardless for some time. On repeat "Again the issue is the disconnect between the story telling about the China deal and inconclusion between the Tories and Labor in the UK. What could go wrong?"

It is now over six months since the latest trade deal between the United States with China deadline of March 1. The White house said it needs more time, then turned around and slapped more tariffs on and said hey we are still talking.  Are we the only one that sees the constant reset to keep markets elevated? If you have half a non partisan brain it should be all pretty clear the great game going on.

For emerging markets the high US dollar means the Fragile 5 continue to shake. Argentina and Turkey are red letter risks. Voters will also be going to the polls in Poland,Indonesia, the Philippines and Thailand this year.

Over $4 trillion of EM debt matures by the end of 2020, of which around a third is denominated in foreign currency, according to the Institute of International Finance. Nevertheless Banks are telling investors to buy, buy, buy, who is selling you should ask? 

If you wanted to play in the big room at Vegas, you are living it. Understand risk and the madness of crowds for your own sanity and wealth.

Focus on yourself and what YOU CAN INFLUENCE, set your trading plan and goals in be set for 2019. One suspects it will be a year long Groundhog day for Trump, the GOP and the Democrats. We still have China and the U.S.trade wars.

Earnings The earnings reporting period continued with Alphabet, G00GL AT&T, T Spotify, SPOT, T mobile, TMUS Beyond Meat, BYND, Electronic arts, EA Advanced Micro Devices, AMD Stryker Corp., SYK Sprint, S Corning, GLW ConocoPhillips, COP Merck, MRK, GrubHub GRUB, General Motors, GM Pfizer, PFE MasterCard, MA, Apple, AAPL Yum Brands, YUM GE, GE Cirrus Logic, CRUS McKesson, MCK Hyatt hotels, each Starbucks, SBUX Facebook, FB, Alibaba group, BABA, Etsy ETSY, Bristol-Myers Squibb, WWE, BMY Clorox, CLX International Paper, IP Celgene CELG Cigna, CI Kraft Heinz, KHC, Exxon Mobil, XOM Chevron, CVX and Colgate-Palmolive, CL

We start off on Monday with: Adobe (Analyst Meeting), Under Armour, Uber, Shake Shack

Tuesday Earnings Include: Emerson Electric, Peloton, Devon $DVN Diamondback $FANG Hi-Crush $HCR Laredo Petroleum $LPI Mammoth $TUSK Oasis $OAS Oasis $OMP Pacific Drilling $PACD Parker $PKD Parsley $PE Plains All American Pipeline $PAA Surge $SGY Whiting Petroleum $WLL

Wednesday Earnings Include: CVS, Wendy’s, Qualcomm, Square, Roku, Dexcom,

Thursday Earnings Include: Disney, Planet Fitness, Take-Two Interactive, Dropbox

Friday Earnings Include: Magna

-comment section below data-

Geopolitical Tinderbox Radar

Trade Imbalances IMF

Italy CDS
Turkey Geopolitical

Last Week's Big Stories

The Week That Was - Last Weeks Recap

Earnings

Stock Markets

Biggest Stock Winners and Losers Last Week*

MW Top Stocks 11 1 19
 

Which Stocks Moved US ETF's Last Week


 MW Top ETF Stocks 11 1 19

US Stock Indices Performance

There was a reason why we kept harping on about this risk: The performance in shares of small-cap companies which are domestically focused than the large-cap firms is a concern for the optimism in the markets, belies the ATH optimism. The small-cap Russell 2000 index had gained 16.6% for the year, which has underperformed the benchmark S&P 500 index which had risen over 19.5%. Whereas the DJIA, NDX and SPX have marked new records highs, it remained 9.7% below its August 2018 high.

 MW US Perf 11 1 19

S&P 500

SPX continued higher after consolidating recent gains with impulse over +2/8 MM accelerated after tenkan went through 50dma. Watch impulse and hugging of daily speed lines. Chikou  needs rebalance and Kijun and daily tenkan are support. Clearly bullish euphoria

Note developing pennant (pink) failed. Best alternatives are a (ii) of wave V higher,  A of a larger 2 or this is i of something more powerful down or up. The alternative that the recent low is a C also played out with new highs. Speed and channel lines in tune with algo calibration curve.

 MW SPX D 11 1 19

Weekly SPX  traded to new  all time highs after spat the trend line and back up through the Kijun and tenkan retains energy and in 3 waves so we must be aware of alternatives. We watch the top of the channel if this is a spit or clear break and +2/8 Murrey Math recalc confluence support is 50 wma wtenkan and kijun

MW SPX W 11 1 19

Apple $AAPL

(Another ATH Leading underlying strength of US Indices)

 MW AAPL W 11 1 19

Amazon $AMZN

 MW AMZN W 11 1 19

CBOE VIX INDEX

Data via Ole S Hansen @Ole_S_Hansen

VIX caution: Not only did the net-short hit a record but so did the percentage of total open interest which reached 50%. History tells us that positions this elevated could leave the short side very vulnerable to a sudden change in direction $SPX $SVXY $XIV

Image

Speculators increased their VIX futures net-short by 17k lots to a RECORD 188k lots in the wk to Oct. 29. During the past month the #SPX rally has helped widen the contango thereby fueling short-selling strategies though futures and inverse ETFs $SVXY and $XIV.

 Image

Fixed Interest

10 Year Treasury Note

MW TNX W 11 1 19
 

Energy and Commodities

US Crude Oil (WTI)

WTI has chopped since it filled the gap without any resistance quickly completing a fractal spit per Adam's Theory it has built an ABC or 1-2 i ii of 3 in consolidation with the $ES_F supporting. We saw a little bull flag powered by the Kijun holding and powering through tenkan and 50 dma. Tne near 57 highs tells us whether this is 1-2 ot a-b. The impulse meant a C or (Y) complete - bullish case would be a developing X 

MW CL D 11 1 19
 

After WTI spat the weekly 61.8% momentum continued with power through the gap up and Reversed back under Tenkan, Kijun and 50wma (green) under the cloud, This week we are back retesting after rallied off channel.

 MW CL W 11 1 19

US Natural Gas (Henry Hub)

Natural Gas after being fuled by the Kijun Tenkan cross gapped up over the daily cloud and 50 dma and ran all the way to the Murrey Math 8/8 and Wave iii or Alt C high. Support is near lows and the cloud from underneath . Chikou rebalancing at the key resistance. 

MW NG D 11 1 19

Natural Gas  has got above the 50 wma to close at 3/8 confluence, with the tenkan and Kijun nw support. The Kijun/Tenkan cross pumped the move after retesting the weekly channel break.


MW NG W 11 1 19 

Baltic Dry Index (BDI)

MW BDI W 11 1 19
 

Precious Metals

Gold

Gold continues to develope structure after it bounced after 3 waves into the Tenkan but quickly came off to form a higher degree (a) of the B of the 4 - key is the recent lows at tenkan for whether this is a C or 3?  Like Silver watch Fibs and Tenkan and Kijun. Watching for corrective 2 waves to tell us what this move is

.MW Gold W 11 1 19

Silver

Silver ralied sharply off the 38% after it rallied in 3 waves to retest the September 2017 breakdown has been correcting the impulse with impulse reversal - meaning C or 3 and we came back to rebalance Chikou and bounced through tenkan and 38% to spit those levels  We watch recent lows if this a 1 down or more - watch tenlan above and flattening  Kijun below.

 MW Silver W 11 1 19

Currency Markets

Australian Dollar - AUDUSD

The Aussie dollar impulse rally ignited through the Kijun this week and will need to clear the 50wma for the daily cloud above. The move hit the first target through the bull flag break with flat Kijun pulling and then releasing.


MW AUD W 11 1 19
 

New Zealand Dollar - NZDUSD

The Kiwi followed the AUDUSD through the Tenkan higher pulled up by the flat Kijun just shy of the breakdown (muave). Weekly channel in focus with tenkan now support. The Chikou under previous lows key at week's end. 

MW NZD W 11 1 19

Canadian Dollar - USDCAD

The USDCAD has fallen sharply through Kijun, the cloud and the near uptrend testing support of the last rally and 38%. We watch if developing in larger flag (white channel)  Resistance now top of cloud and tenkan Kijun and 50 wma. The tenkan remains the pivot aspect. Support is previous lows and channel.

MW CAD W 10 25 19
 

Euro - EURUSD

Euro is back retesting  the Kijun governed by Brexit pound volatility. Support remains Tenkan with pennant break. Unless this is a spit the potential of the measured move comes in around 1.0630 and lower. EUR remains a battle between EURJPY and EURCHF and EURGBP.
 MW EUR W 11 1 19

EuroPound - EURGBP

EURGBP is trying to bounce in a 2 after being down sharply in 3 waves but needs impulse for confirmation if correcting the July breakup or is a deeper move. The weekly cloud gave way and found support at the May breakup to complete min for wave 2 reflecting the madness of Brexit politics. Resistance at chikou and Tenkan with support at channel.

MW EURGBP W 11 1 19
 Japanese Yen - USDJPY

The dollar yen recovery finally got over the weekly Kijun - can it get legs and pull away? Not yet, it was halted by the 38% and and Murrey 6/8.  Kijun now key again. Yen buying returned on crosses, EURJPY and AUDJPY taking away the cloud twist that drew the dollar up.

MW JPY W 11 1 19

 Mexican Peso USDMXN

Mexican peso continued to strengthen after it spat the upper channel and has come all the way back through the Kijun and tenkan through the channel bottom which are now resistance. Watch if a fractal spit on the trend continues.

MW MXN D 11 1 19
 

Turkish Lire USDTRY

The USD Turkish Lire is testing the cloud from below after continued to pullback through the daily Kijun and Tenkan which is now resistance.  It is so far playing both sides of the channel Support is the previous break up, resistance Tenkan.

MW TRY D 11 1 19 

Bitcoin

Bitcoin found sharp impulse after the sell of this week off 3 waves, back to the  tenkan and kijun. Needs higher for anything more than a correction. Use your MM rules as algos control the herd here, support is the cloud - we said be wary of sharp ABC, 1-2 moves.

 MW BTC W 11 1 19

The Week Ahead

Key US Economic and Central Bank Events This Week

Sun November 3, 2019

  • 19:00 AUD MI Inflation Gauge (MoM)
  • 19:30 AUD ANZ Job Advertisements (MoM)
  • 19:30 AUD Retail Sales (MoM) (Sep)
  • 19:30 AUD Retail Sales (QoQ) (Q3)

Monday, November 4, 2019

  • All Day Holiday Japan - Culture Day
  • All Day Holiday Russia - National Unity Day
  • 01:45 CHF SECO Consumer Climate (Q4)
  • 02:45 EUR French Government Budget Balance
  • 03:15 EUR Spanish Manufacturing PMI (Oct)
  • 03:45 EUR Italian Manufacturing PMI (Oct)
  • 03:50 EUR French Manufacturing PMI (Oct)
  • 03:55 EUR German Manufacturing PMI (Oct)
  • 04:00 EUR Manufacturing PMI (Oct)
  • 04:30 GBP Construction PMI (Oct)
  • 04:30 EUR Sentix Investor Confidence (Nov)
  • 08:00 SGD Manufacturing PMI
  • 09:45 USD ISM NY Business Conditions (Oct)
  • 09:45 USD ISM-New York Index (Oct)
  • 10:00 USD CB Employment Trends Index (Oct)
  • 10:00 USD Durables Excluding Defense (MoM) (Sep)
  • 10:00 USD Factory Orders (MoM) (Sep)
  • 11:30 USD 3-Month Bill Auction
  • 11:30 USD 6-Month Bill Auction
  • Tentative USD Loan Officer Survey
  • 14:00 USD Total Vehicle Sales
  • 16:00 KRW FX Reserves - USD (Oct)
  • 16:30 AUD AIG Services Index (Oct)
  • 18:50 JPY Monetary Base (YoY)
  • 19:00 NZD ANZ Commodity Price Index (MoM)
  • 19:01 GBP BRC Retail Sales Monitor (YoY) (Oct)
  • 19:30 HKD Manufacturing PMI (Oct)
  • 20:45 CNY Caixin Services PMI (Oct) 22:30
  • AUD RBA Interest Rate Decision (Nov)
  • 23:30 AUD RBA Rate Statement

Tuesday Nov 5,2019

  • 03:00 EUR Spanish Unemployment Change
  • 04:30 GBP Composite PMI (Oct)
  • 04:30 GBP Services PMI (Oct)
  • 05:00 EUR PPI (MoM) (Sep)
  • 06:30 EUR Spanish Consumer Confidence
  • 08:30 USD Trade Balance (Sep)
  • 08:30 CAD Trade Balance (Sep)
  • 08:55 USD Redbook (MoM) (YoY)
  • 09:00 NZD GlobalDairyTrade Price Index
  • 09:45 USD Markit Composite PMI (Oct)
  • 09:45 USD Services PMI (Oct)
  • 10:00 USD IBD/TIPP Economic Optimism
  • 10:00 USD ISM Non-Manufacturing PMI (Oct)
  • 10:00 USD JOLTs Job Openings (Sep)
  • 11:30 USD 52-Week Bill Auction
  • 13:00 USD 3-Year Note Auction
  • 16:30 USD API Weekly Crude Oil Stock
  • 16:45 NZD Employment Change (QoQ) (Q3)
  • 18:00 KRW Current Account (Sep)
  • 18:50 JPY Monetary Policy Meeting Minutes
  • 19:30 AUD RBA Chart Pack Release
  • 19:30 JPY Services PMI (Oct)

Wednesday, November 6, 2019

  • 02:00 EUR German Factory Orders (MoM) (Sep)
  • 03:00 EUR Spanish Industrial Production (YoY) (Sep)
  • 03:15 EUR Spanish Services PMI (Oct)
  • 03:45 EUR Italian Composite PMI (Oct)
  • 03:45 EUR Italian Services PMI (Oct)
  • 03:50 EUR French Markit Composite PMI (Oct)
  • 03:50 EUR French Services PMI (Oct)
  • 03:55 EUR German Composite PMI (Oct)
  • 03:55 EUR German Services PMI (Oct)
  • 04:00 EUR Markit Composite PMI (Oct)
  • 04:00 EUR Services PMI (Oct)
  • 05:00 EUR Retail Sales (MoM) (Sep)
  • 06:00 USD Chicago Fed President Evans Speaks
  • 07:00 USD MBA 30-Year Mortgage Rate
  • 07:00 USD MBA Mortgage Applications (WoW)
  • 07:00 USD MBA Purchase Index
  • 07:00 USD Mortgage Market Index
  • 07:00 USD Mortgage Refinance Index
  • Tentative GBP Autumn Budget
  • 07:30 USD FOMC Member Williams Speaks
  • 08:30 USD Nonfarm Productivity (QoQ) (Q3)
  • 08:30 USD Unit Labor Costs (QoQ) (Q3)
  • Tentative USD MBA Delinquency Rates (QoQ)
  • 10:00 CAD Ivey PMI (Oct)
  • 10:30 USD Crude Oil Inventories
  • 13:00 USD 10-Year Note Auction
  • 13:15 USD FOMC Member Harker Speaks
  • 16:30 AUD AIG Construction Index (Oct)
  • 18:00 JPY Reuters Tankan Index (Nov)
  • 19:30 AUD Trade Balance (Sep)

Thursday, November 7, 2019

  • 02:00 EUR German Industrial Production (MoM) (Sep)
  • 02:45 EUR French Industrial Investments (Q4)
  • 03:00 CNY FX Reserves (USD)
  • 03:30 GBP Halifax House Price Index (MoM) (Oct)
  • 04:00 EUR Italian Retail Sales (YoY) (Sep)
  • 04:00 EUR Italian Retail Sales (MoM) (Sep)'
  • 04:00 EUR ECB Economic Bulletin
  • 05:00 EUR EU Economic Forecasts
  • 05:00 EUR Eurogroup Meetings
  • 07:00GBP BoE Inflation Report
  • 07:00 GBP BoE Interest Rate Decision (Nov)
  • 07:00 GBP BoE MPC Meeting Minutes
  • 07:30 GBP BoE Gov Carney Speaks
  • 08:30 USD Continuing Jobless Claims
  • 08:30 USD Initial Jobless Claims
  • 08:30 USD Jobless Claims 4-Week Avg.
  • 10:30 USD Natural Gas Storage
  • 11:05 USD FOMC Member Kaplan Speaks
  • 11:30 USD 4-Week Bill Auction
  • 11:30 USD 8-Week Bill Auction
  • 11:30 USD 30-Year Bond Auction
  • 15:00 USD Consumer Credit (Sep)
  • 17:10 USD FOMC Member Bostic Speaks
  • 18:30 JPY Household Spending (MoM) (Sep)
  • 18:30 JPY Household Spending (YoY) (Sep)
  • 19:30 AUD Home Loans (MoM) (Sep)
  • 19:30 AUD Invest Housing Finance (MoM)
  • 19:30 AUD RBA Monetary Policy Statement
  • 22:00 CNY Exports (YoY)
  • 22:00 CNY Imports (YoY)
  • 22:00 CNY Trade Balance (USD)

Friday Nov 8, 2019

  • 00:00 JPY Coincident Indicator (MoM) (Sep)
  • 00:00 JPY Leading Index (MoM) (Sep)
  • 01:45 CHF Unemployment Rate n.s.a. (Oct)
  • 02:00 EUR Gemran Current Account Balance n.s.a (Sep)
  • 02:00 EUR German Trade Balance (Sep)
  • 02:45 EUR French Current Account (Sep)
  • 02:45 EUR French Industrial Production (MoM) (Sep)
  • 02:45 EUR French Non-Farm Payrolls (QoQ) (Q3)
  • 02:45 EUR French Trade Balance (Sep)
  • 05:00 EUR EU Finance Ministers Meeting
  • 08:15 CAD Housing Starts (Oct)
  • 08:30 CAD Building Permits (MoM) (Sep)
  • 08:30 CAD Employment Change (Oct)
  • 08:30 CAD Unemployment Rate (Oct)
  • 10:00 USD Michigan Consumer Sentiment (Nov)
  • 10:00 USD Wholesale Inventories (MoM)
  • 12:00 USD WASDE Report
  • 13:00 USD U.S. Baker Hughes Oil Rig Count
  • 14:30 USD CFTC speculative net positions
  • 20:30 CNY CPI (YoY) (Oct)
  • 20:30 CNY CPI (MoM) (Oct)
  • 20:30 CNY PPI (YoY) (Oct)

Saturday, Nov 2, 2019

  • Nil

 

Stock Buyback Watch

Via Emad Mnati @EmadMnati and MarketBeat

Stock BuyBAcks 1

Stock BuyBAcks 2

 

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Note these charts, opinons news and estimates and times are subject to change and for indication only. Trade and invest at your own risk.

Trade Smart!

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