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Fed Powell Doling Out Money

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

Stock Market Record Highs, Powell and Tariffs

The Week That Was:

Another week of record highs on US equity markets and rebounding oil and natural gas prices powered by a expectations of tariff roll backs and a continuing dovish Fed cutting rates and a flow on from a robust US jobs report for October, Apple continued to hit all time highs and the highest US index beta stocks dragged the markets up further.

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 finished over $57 bbl despite another huge build and 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 the market spotlight on President Trump as speaks to the Economic Club of New York and the Fed chair Powell testifying to Congress and the Senate. We then have increasing noise from Britain ahead of the next British general elections on 12 December.

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  Bond market closed for Veteran’s Day and Boston Fed President Eric Rosengren
  • Tuesday  US Fed Vice Chair Richard Clarida NFIB small business survey Philadelphia Fed President Patrick Harker Richmond Fed President Tom Barkin President Donald Trump speaks at Economic Club of New York Minneapolis Fed President Neel Kashkari
  • Wednesday CPI US Fed Chairman Jerome Powell speaks before Joint Economic Committee Richmond Fed’s Barkin Federal budget Minneapolis Fed’s Kashkari, EIA Crude Oil Inventories
  • Thursday US Fed Vice Chairman Randal Quarles PPI Jobless claims New York Fed President John Williams Chicago Fed President Charles Evans Fed Vice Chairman Clarida Powell before House Budget Committee Dallas Fed President Robert Kaplan EIA Natural Gas Storage
  • Friday US Retail sales Import prices Empire State manufacturing Industrial production Business 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 Adobe (Analyst Meeting), Under Armour, Uber, Shake Shack 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 CVS, Wendy’s, Qualcomm, Square, Roku, Chesapeake, Dexcom, Disney, Planet Fitness, Take-Two Interactive, Activision Blizzard, Dropbox and Magna

We start off on Monday with: Tencent Music, Liberty Broadband, Noah Holdings, Grocery Outlet

Tuesday Earnings Include: CBS, Datadog, Skyworks Solutions, Nissan, Tyson Foods, Advance Auto Parts, DR Horton, Rockwell Automotive, Vodafone, Adaptive Biotech, Tilray, SmileDirectClub

Wednesday Earnings Include: Cisco Systems, Beazer Homes, Copa Holdings, Luckin Coffee, Change Healthcare, Tetra Tech, Tencent, Best Inc,

Thursday Earnings Include: Walmart, Nvidia, Applied Materials, Brookfield Asset Management, International Game Technology, Canopy Growth, Burberry, Wheaton Precious Metals

Friday Earnings Include: JD.com, JC Penney

-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 8 19 

Which Stocks Moved US ETF's Last Week

MW Top ETF Stocks 11 8 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 8 19

S&P 500

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

Note developing pennant (pink) failed. Best alternatives were a (ii) of wave V higher,  A of a larger 2 or this is iii of something more powerful. 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 8 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 1 thrust wave so we must be aware of alternatives. We have closed over the top of the channel, watch if this is a spit or clear break and +2/8 Murrey Math confluence support is 50 wma wtenkan and kijun

 MW SPX W 11 8 19

Apple $AAPL

(Another ATH Leading underlying strength of US Indices)

MW AAPL W 11 8 19 

Amazon $AMZN

MW AMZN W 11 8 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 8 19
 

Energy and Commodities

US Crude Oil (WTI)

WTI bounced off the tenkan and 50 dma zone to close over the cloud , is it a significant event?  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 58 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 8 19 

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

 MW CL W 11 8 19

US Natural Gas (Henry Hub)

Natural Gas rebalancing at the chikou with support at Kijun Tenkanafter gapped up over the daily cloud and 50 dma and ran all the way to the Murrey Math 1/8 and Wave iii or Alt C high. Support also  near lows and the cloud from underneath 

 MW NG D 11 8 19

Natural Gas rally so far rejected at the 61.8% and the March highs has got above the 50 wma to close at 3/8 confluence, with the tenkan and Kijun now support. The Kijun/Tenkan cross pumped the move after retesting the weekly channel break.

 MW NG W 11 8 19

 

Baltic Dry Index (BDI)


 MW BDI W 11 8 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 8 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 tenkan above and flattening  Kijun below.

 MW Silver W 11 8 19

Currency Markets

Australian Dollar - AUDUSD

The Aussie dollar impulse rally back testing the Kijun this week after tapping 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 8 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 8 19 

Canadian Dollar - USDCAD

The USDCAD rebounded sharply with a flat Kijun above back into the cloud over the tenkan after holding 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 11 8 19
 

Euro - EURUSD

Euro is back retesting  the tenlkan after a firm rejection of Kijun governed by Brexit pound volatility. Support here the 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 8 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 8 19
 Japanese Yen - USDJPY

The dollar yen recovery finally got over the weekly Kijun - and ran into a wall at 50 wma and the cloud 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 8 19

 Mexican Peso USDMXN

Mexican peso continued to strengthen in a pennant fter 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 8 19
 

Turkish Lire USDTRY

The USD Turkish Lire is testing over 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 and tenkan, resistance Kijun.

MW TRY D 11 8 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 8 19 

The Week Ahead

Key US Economic and Central Bank Events This Week

Sun November 10, 2019

  • 16:45 NZD Electronic Card Retail Sales (MoM) (Oct)
  • 16:45 NZD Electronic Card Retail Sales (YoY) (Oct)
  • 18:50 JPY Bank Lending (YoY) (Oct)
  • 18:50 JPY BoJ Summary of Opinions
  • 18:50 JPY Core Machinery Orders (MoM) (Sep)
  • 18:50 JPY Current Account n.s.a. (Sep)

Monday, November 11, 2019

  • Bond market closed for Veteran’s Day 00:00 JPY Economy Watchers Current Index (Oct)
  • 02:00 EUR German WPI (MoM) (Oct)
  • 04:00 EUR Italian Industrial Production (MoM) (Sep)
  • 04:30 GBP Business Investment (QoQ) (Q3)
  • 04:30 GBP Construction Output (MoM) (Sep)
  • 04:30 GBP GDP (MoM) 04:30 GBP Index of Services
  • 04:30 GBP Industrial Production (MoM) (Sep)
  • 04:30 GBP Manufacturing Production (MoM) (Sep)
  • 04:30 GBP Trade Balance (Sep)8:15 a.m. Boston Fed President Eric Rosengren
  • 09:00 GBP NIESR Monthly GDP Tracker
  • 18:50 JPY M3 Money Supply (Oct)
  • 19:30 AUD NAB Business Confidence (Oct)
  • 19:30 AUD NAB Business Survey (Oct)
  • 21:00 NZD Inflation Expectations (QoQ)
  • 22:35 JPY 30-Year JGB Auction

Tuesday Nov 12,2019

  • All Day Holiday India - Guru Nanak Jayanti
  • 00:00 SGD Retail Sales (MoM) (Sep)
  • 01:00 JPY Machine Tool Orders (YoY)
  • 04:30 GBP Average Earnings ex Bonus (Sep)
  • 04:30 GBP Employment Change 3M/3M (MoM) (Sep)
  • 04:30 GBP Unemployment Rate (Sep)
  • 05:00 EUR German ZEW Current Conditions (Nov)
  • 05:00 EUR German ZEW Economic Sentiment (Nov)
  • 05:00 EUR ZEW Economic Sentiment (Nov)
  • 06:00 USD NFIB Small Business Optimism (Oct)
  • 08:55 USD Redbook (MoM)
  • 11;00 Tenative President Tump speaks to the Economic Club of New York
  • 11:30 USD 6-Month Bill Auction
  • 16:45 NZD FPI (MoM) (Oct)
  • 18:00 KRW Unemployment Rate (Oct)
  • 18:30 AUD Westpac Consumer Sentiment (Nov)
  • 18:50 JPY PPI (MoM) (Oct)
  • 19:30 AUD Wage Price Index (QoQ) (Q3)
  • 20:00 NZD RBNZ Interest Rate Decision
  • 20:00 NZD RBNZ Monetary Policy Statement
  • 21:00 NZD RBNZ Press Conference

Wednesday, November 13, 2019

  • 02:00 EUR German CPI (MoM) (Oct)
  • 02:00 EUR German HICP (MoM) (Oct)
  • 04:30 GBP CPI (MoM)
  • 04:30 GBP PPI Input (MoM) (Oct)
  • 04:30 GBP PPI Output (MoM) (Oct)
  • 05:00 EUR Industrial Production (MoM) (Sep)
  • 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
  • 08:30 USD CPI (MoM) (Oct)
  • 08:30 USD Real Earnings (MoM) (Oct)
  • 11:00 USD Cleveland CPI (MoM) (Oct)
  • 11:00 USD Fed Chair Powell Testifies to the Congressional Joint Economic Committee
  • 14:00 USD Federal Budget Balance (Oct)
  • 16:00 KRW Export Price Index (YoY) (Oct)
  • 16:00 KRW Import Price Index (YoY) (Oct)
  • 16:30 USD API Weekly Crude Oil Stock
  • 18:50 JPY GDP (QoQ) (Q3)
  • 18:50 JPY GDP Capital Expenditure (QoQ) (Q3)
  • 18:50 JPY GDP External Demand (QoQ) (Q3)
  • 19:00 AUD MI Inflation Expectations
  • 19:01 GBP RICS House Price Balance (Oct)
  • 19:30 AUD Employment Change (Oct)
  • 19:30 AUD Unemployment Rate (Oct)
  • 21:00 CNY Fixed Asset Investment (YoY) (Oct)
  • 21:00 CNY Industrial Production (YoY) (Oct)
  • 21:00 CNY Retail Sales (YoY) (Oct)
  • 21:00 CNY Chinese Unemployment Rate
  • 23:30 JPY Tertiary Industry Activity Index (MoM)

Thursday, November 14, 2019

  • 01:30 EUR French Unemployment Rate (Q3)
  • 02:00 EUR German GDP (QoQ) (Q3)
  • 02:00 CNY FDI
  • 02:45 EUR French CPI (MoM) (Oct)
  • 02:45 EUR French HICP (MoM) (Oct)
  • 03:00 EUR Spanish CPI (MoM) (Oct)
  • 03:00 EUR Spanish HICP (MoM) (Oct)
  • 04:00 CNY M2 Money Stock (YoY)
  • 04:00 CNY New Loans
  • 04:00 CNY Outstanding Loan Growth (YoY)
  • 04:00 CNY Chinese Total Social Financing
  • 04:30 GBP Retail Sales (MoM) (Oct
  • 04:30 ZAR Gold Production (YoY) (Sep)
  • 04:30 ZAR Mining Production (Sep)
  • 04:45 EUR ECB's De Guindos Speaks
  • 05:00 EUR Employment Change (QoQ)
  • 05:00 EUR GDP (QoQ) (Q3)
  • 05:30 USD FOMC Member Quarles Speaks
  • 06:00 USD OPEC Monthly Report
  • 08:30 USD Continuing Jobless Claims
  • 08:30 USD Initial Jobless Claims
  • 08:30 USD Jobless Claims 4-Week Avg.
  • 08:30 USD PPI (MoM) (Oct)
  • 08:30 CAD New Housing Price Index (MoM) (Sep)
  • Tentative USD MBA Delinquency Rates (QoQ)
  • 09:10 USD Chicago Fed President Evans Speaks
  • 09:10 USD FOMC Member Clarida Speaks
  • 10:00 USD Fed Chair Powell Testifies before the House Budget Committee Thursday.
  • 10:30 USD Natural Gas Storage
  • 11:00 USD Crude Oil Inventories
  • 11:30 USD 4-Week Bill Auction
  • 11:30 USD 8-Week Bill Auction
  • 12:00 USD FOMC Member Williams Speaks
  • 12:30 CHF SNB Gov Board Member Maechler Speaks
  • 16:30 NZD Business NZ PMI (Oct)
  • 19:00 SGD GDP (QoQ)
  • 20:30 CNY House Prices (YoY) (Oct)
  • 21:00 KRW Trade Balance (Oct)
  • 21:15 AUD RBA Assist Gov Debelle Speaks
  • 21:45 CAD BoC Gov Poloz Speaks
  • 23:30 JPY Capacity Utilization (MoM) (Sep)
  • 23:30 JPY Industrial Production (MoM) (Sep)

Friday Nov 15, 2019

  • All Day Holiday Brazil - Proclemation of The Republic
  • 03:00 EUR ECB's Mersch Speaks
  • 03:30 HKD GDP (QoQ) (Q3)
  • 04:00 EUR Italian Trade Balance (Sep)
  • 05:00 EUR Italian CPI (MoM) (Oct)
  • 05:00 EUR Italian HICP (MoM) (Oct)
  • 05:00 EUR Core CPI (MoM) (Oct)
  • 05:00 EUR CPI (MoM) (Oct)
  • 05:00 EUR HICP ex Energy and Food (MoM) (Oct)
  • 05:00 EUR Trade Balance (Sep)
  • 08:30 USD Export Price Index (MoM) (Oct)
  • 08:30 USD Import Price Index (MoM) (Oct)
  • 08:30 USD NY Empire State Manufacturing Index (Nov)
  • 08:30 USD Retail Sales (MoM) (Oct)
  • 08:30 CAD Foreign Securities Purchases (Sep)
  • 08:30 CAD Foreign Securities Purchases by Canadians (Sep)
  • 09:15 USD Capacity Utilization Rate (Oct)
  • 09:15 USD Industrial Production (MoM) (Oct)
  • 09:15 USD Manufacturing Production (MoM) (Oct)
  • 10:00 USD Business Inventories (MoM) (Sep)
  • 10:00 USD Retail Inventories Ex Auto (Sep)
  • 13:00 USD U.S. Baker Hughes Oil Rig Count
  • 14:30 USD CFTC speculative net positions

Saturday, Nov 16, 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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