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

Stock Market Mania, Jobs and Tariffs

The Week That Was:

Thanksgiving gave a shortened week but all the hallmarks of the U.S. stock markets mania remain. We saw the collapse of risk assets, Natural Gas, Crude Oil and Btcoin on Friday as the US dollar rallied. However, despite greater tension between the US and China over Hong Kong fear is absent for the most part, pffft, no trade deal, impeachment, OPEC and  Iran the fear of missing out remains supreme.,

The put call ratio, Vix and talking heads underscore there is no fear out there. We remain not far off the Dow Jones Industrial Average 28,000. How many times can China and the White House say China and the U.S. are getting close to reaching a trade deal before the market calls their bluff?. (I may be sceptical but these types of accouncements have come out all most daily for a few weeks with no substance, market manipulation at its best knowing the best illiquid times for news algos.)There is a reason why so many experienced fund managers are closing up shop.

Apple remains the best-performing stock in the Dow since July 11, when the index first reached 27,000. Since then the Apple shares are up more than 30%. Intel, J.P. Morgan, United Technologies are some of the stocks that have also rallied more than 10% since July 11. Home depot had been but lost 6% in a day after earnings. There are a mutlitude of stocks with losses of 10 to 25% a day in this market, This is the hallmarks of a casino rather than a rational market place.

After futures expiration oil joined in the fun, jumping over $58.70 despite bearish EIA reports with record production and crude builds of 9 otf 10 weeks. More dovish Fed talk dovish Fed cutting rates as Apple continued to hit all time highs and the highest US index beta stocks dragged the markets up further.

The market has 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.The consumer has been keeping the economy robust, all eyes will be on the Black Friday sales this week.

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. Enjoy those Thanksgiving conversations!

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

This week we start with the ISM manufacturing report on Monday which is also Cyber Monday. Shoppers spent a record amount online on Thanksgiving Day, and Black Friday online sales was up huge. This is the first year Thanksgiving spending has surpassed $4 billion, boosted by a 244% increase in sales from e-commerce, according to data released by Adobe. Cyber Monday sales are forecast to grow by nearly 20% to $9.4 billion, according to Adobe. We close the week with thee government’s all-important monthly jobs report on Friday.

We have also 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 
    German PMI Manufacturing, UK PMI Manufacturing, U.S. Cyber Monday, Construction Spending, ISM Manufacturing
  • Tuesday
    EU Producer Price Index, UK Construction PMI, US Auto Sales
  • Wednesday EU PMI Composite and Services Germany PMI Composite & Services EIA US Crude Oil Inventories ISM Non-Manufacturing MBA Mortgage Applications, PMI Composite and services
  • Thursday EU Gross Domestic Product, Retail Sales German Factory Orders US Balance of Trade, Jobless Claims, Factory Orders, Natural Gas Storage
  • Friday Germany Industrial Production, US Consumer Credit Non-Farm Payrolls,Unemployment Rate , U. of Michigan Confidence, 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 PVH, Palo Alto Networks, Burlington, Dollar Tree, Best Buy, Dick’s Sporting Goods, Dell and Deere

We start off on Monday with: No significant earnings then we get;

Tuesday Earnings Include: Workday (WDAY), Salesforce.com (CRM), Zscaler, Inc. (ZS)

Wednesday Earnings Include: Slack Technologies (WORK), Campbell Soup Co. (CPB)

Thursday Earnings Include: Lululemon Athletica (LULU), Ulta Beauty (ULTA), Dollar General Corp. (DG), Kroger Co. (KR), Tiffany & Co. (TIF)

Friday Earnings Include: Nil

-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 29 19

 Which Stocks Moved US ETF's Last Week

MW Top ETF Stocks 11 29 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 29 19 

S&P 500

SPX  rallied to ATH after corrected back to the daily speed line where Tenkan flattens now below at MM 8/8. Kijun flattens at previous launch pad. Watch impulse and hugging of daily speed lines and the tenkan below. 

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 29 19

Weekly SPX  covered the red spug to new all time highs, the first since after spat the trend line and back up through the Kijun and tenkan retains energy and in 1 thrust wave. Below channel, watch if a spit or clear break support is 50 wma w tenkan and kijun

 MW SPX W 11 29 19

Apple $AAPL

(Another ATH Leading underlying strength of US Indices)

MW AAPL W 11 22 19
 

Amazon $AMZN

MW AMZN W 11 29 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 29 19
 

Energy and Commodities

US Crude Oil (WTI)

Last week WTI bounced sharply through the tenkan, Kijun and 50 dma zone to close at the cloud  after futures expiration, we noted this was a rising wedge  without any resistance quickly completing a fractal spit per Adam's Theory. This gave way this week as expected powering through the kiju, tenkan and 50 dma to the bottom channel. The impulse meant a C or (Y) complete - bullish case would be a developing X

MW CL D 11 29 19 

WTI sharp impulse higher through 50 WMA rejected at the cloud  saw a reversal sharply lower- we were still working throught the fall after it spat the weekly 61.8% We closed  under Kijun and 50wma confluence (green) under the cloud just over the weekly tenkan., 

MW CL W 11 29 19

US Natural Gas (Henry Hub)

Natural Gas accelerated lower after tenkan crossed though kijun all the way to October break up . Resistance from cloud down from impulse. on bounce rebalancing with chikou. Gap above and gap below indicated the traps on both sides.  Correcting the Murrey Math 1/8 and Wave iii or Alt C high. Support also near lows and channel from underneath 

 MW NG D 11 29 19

Impulse down after Natural Gas rally rejected at the 61.8% and the March highs with the tenkan and Kijun now resistance after a retest of the 2.50-52 band gave way all the way to the sharp uptrend support at 2.27. Watch for Kijun/Tenkan cross  after retesting the weekly channel break.

 MW NG W 11 29 19

 

Baltic Dry Index (BDI)

MW BDI W 11 29 19
 

Precious Metals

Gold

Gold continues in corrective mode of wave structure after it bounced in 3 waves to 1556 to Murrey Math +2/8. Resistnce is Tenkan support is Kijun while market decides.  From there 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 29 19

Silver

Silver difference to gold withs it blow off 3 or C rallied off the 50% after it rallied in 3 waves to retest the September 2017 breakdown has been correcting the impulse with impulse reversal. Struggling to get over Kijun with Tenkan above.  We watch recent lows if this a 1 down or more .

 MW Silver W 11 29 19

Currency Markets

Australian Dollar - AUDUSD

The Aussie dollar still working after failed at the Kijun now under tenkan. Work being done after the move to the first target through the bull flag break with flat Kijun pulling and then releasing.

MW AUD W 11 29 19

 New Zealand Dollar - NZDUSD

The Kiwi has bounced against #AUD and #USD reflected in $AUDNZD. Bounced off the Tenkan, pulled higher by the flat Kijun just shy of the breakdown (muave). Weekly channel in focus with tenkan now support. The Chikou under series of tops key at week's end.
 MW NZD W 11 29 19

Canadian Dollar - USDCAD

The USDCAD rebounded sharply off tenkan to the flat Kijun above back into the cloud  to 50wma. We watch if developing in larger flag (white channel)  Resistance now top of cloud and 50 wma. The tenkan remains the pivot aspect. Support is previous lows and channel.

MW CAD W 11 29 19
Euro - EURUSD

Euro flirting with tenkan after  firm rejection of Kijun governed by $EURGBP Brexit pound volatility. Support 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 29 19
 

EuroPound - EURGBP

EURGBP sums up EUR weakness - trying to bounce in a 2  failed after blow off of weekly channel. 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 reflecting Brexit politics. Resistance at  kijun and Tenkan with support at channel.

MW EURGBP W 11 29 19
 Japanese Yen - USDJPY

The dollar yen got over the weekly Kijun and ran into a wall at 50 wma which we are now over on the close. Still needs to get over cloud to get legs and pull away. Not yet, it was halted by the 38% and Murrey 6/8.  Kijun need to turn up for impulse. Yen buying returned on crosses, EURJPY and AUDJPY taking away the cloud twist that drew the dollar up.

MW JPY W 11 29 19

 Mexican Peso USDMXN

Mexican peso weakened after it broke the pennant back into the channel  pulled by the Kijun and tenkan into the cloud which is now resistance. Watch if a fractal spit on the trend continues.
 MW MXN W 11 29 19

Turkish Lire USDTRY

The USD Turkish Lire struggles still under cloud. Watch daily Kijun and Tenkan trying to cross.  It is so far playing both sides of the channel Support is the previous break up and tenkan, resistance Kijun.
 MW TRY D 11 29 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 29 19
 

The Week Ahead

Key US Economic and Central Bank Events This Week

Sun December 1, 2019

  • 16:30 AUD AIG Manufacturing Index (Nov)
  • 16:45 NZD Terms of Trade Index (QoQ) (Q3)
  • 17:00 KRW CPI (MoM) (Nov)
  • 18:50 JPY Capital Spending (YoY) (Q3)
  • 19:00 AUD MI Inflation Gauge (MoM)
  • 19:30 KRW Nikkei Manufacturing PMI (Nov)
  • 19:30 AUD ANZ Job Advertisements (MoM)
  • 19:30 AUD Building Approvals (MoM) (Oct)
  • 19:30 AUD Business inventories (MoM) (Q3)
  • 19:30 AUD Company Gross Operating Profits (QoQ) (Q3)
  • 19:30 AUD Private House Approvals (Oct)
  • 19:30 JPY Manufacturing PMI (Nov)
  • 20:45 CNY Caixin Manufacturing PMI (Nov)

Monday, December 2, 2019

  • 02:30 CHF Retail Sales (YoY) (Oct)
  • 03:15 EUR Spanish Manufacturing PMI (Nov)
  • 03:30 CHF procure.ch PMI (Nov)
  • 03:30 HKD Retail Sales (YoY) (Oct)
  • 03:45 EUR Italian Manufacturing PMI (Nov)
  • 03:50 EUR French Manufacturing PMI (Nov)
  • 03:55 EUR German Manufacturing PMI (Nov)
  • 04:00 EUR Manufacturing PMI (Nov)
  • 04:30 GBP Manufacturing PMI (Nov)
  • 09:00 EUR ECB President Lagarde Speaks
  • 09:30 CAD RBC Manufacturing PMI (Nov)
  • 09:45 USD Manufacturing PMI (Nov)
  • 10:00 USD Construction Spending (MoM) (Oct)
  • 10:00 USD ISM Manufacturing PMI (Nov)
  • 11:30 USD 3-Month Bill Auction
  • 11:30 USD 6-Month Bill Auction
  • 14:30 USD CFTC Speculative net positions
  • 18:00 KRW GDP (QoQ) (Q3)
  • 18:50 JPY Monetary Base (YoY)
  • 19:01 GBP BRC Retail Sales Monitor (YoY) (Nov)
  • 19:30 AUD Current Account (Q3)
  • 19:30 AUD Net Exports Contribution (Q3)
  • 20:45 CNY Chinese Composite PMI (Nov)
  • 22:30 AUD RBA Interest Rate Decision (Dec)
  • 23:30 AUD RBA Rate Statement Legend

Tuesday December 3, 2019

  • 02:30 CHF CPI (MoM) (Nov)
  • 02:45 EUR French Government Budget Balance (Oct)
  • 03:00 EUR Spanish Unemployment Change
  • 04:30 GBP Construction PMI (Nov)
  • 05:00 EUR PPI (MoM) (Oct)
  • Tentative GBP BoE MPC Treasury Committee Hearings
  • 08:00 SGD Manufacturing PMI (Nov)
  • 08:55 USD Redbook (MoM)
  • 09:45 USD ISM NY Business Conditions (Nov)
  • 10:20 NZD GlobalDairyTrade Price Index
  • 11:30 USD 52-Week Bill Auction
  • 12:30 EUR ECB's Coeure Speaks
  • 16:00 KRW FX Reserves - USD (Nov)
  • 16:30 USD API Weekly Crude Oil Stock
  • 16:30 AUD AIG Services Index (Nov)
  • 17:00 AUD Services PMI
  • 18:00 USD Total Vehicle Sales
  • 19:00 NZD ANZ Commodity Price Index (MoM)
  • 19:30 AUD GDP (QoQ) (Q3)
  • 19:30 AUD RBA Chart Pack Release
  • 19:30 JPY Services PMI (Nov)
  • 19:30 HKD Manufacturing PMI (Nov)
  • 20:45 CNY Caixin Services PMI (Nov)
  • 20:45 CNY Chinese Composite PMI (Nov)

Wednesday, December 4, 2019

  • 03:15 EUR Spanish Services PMI (Nov)
  • 03:45 EUR Italian Composite PMI (Nov)
  • 03:45 EUR Italian Services PMI (Nov)
  • 03:50 EUR French Markit Composite PMI (Nov)
  • 03:50 EUR French Services PMI (Nov)
  • 03:55 EUR German Composite PMI (Nov)
  • 03:55 EUR German Services PMI (Nov)
  • 04:00 EUR Markit Composite PMI (Nov)
  • 04:00 EUR Services PMI (Nov)
  • 04:30 GBP Composite PMI (Nov)
  • 04:30 GBP Services PMI (Nov)
  • 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
  • 08:15 USD ADP Nonfarm Employment Change (Nov)
  • 08:30 CAD Labor Productivity (QoQ) (Q3)
  • 09:45 USD Markit Composite PMI (Nov)
  • 09:45 USD Services PMI (Nov)
  • 10:00 USD FOMC Member Quarles Speaks
  • 10:00 USD ISM Non-Manufacturing PMI (Nov)
  • 10:00 CAD BoC Rate Statement
  • 10:00 CAD BoC Interest Rate Decision
  • 10:30 USD Crude Oil Inventories
  • 18:00 KRW Current Account (Oct)
  • 18:00 JPY Reuters Tankan Index (Dec)
  • 19:00 NZD RBNZ Gov Orr Speaks
  • 19:30 AUD Retail Sales (MoM) (Oct)
  • 19:30 AUD Trade Balance (Oct)
  • 20:30 JPY BOJ Board Member Harada Speaks

Thursday, December 5 2019

  • 02:00 EUR German Factory Orders (MoM) (Oct)
  • 03:00 EUR Spanish Industrial Production (YoY) (Oct)
  • 05:00 USD OPEC Meeting
  • 05:00 EUR Employment Change (QoQ) (Q3)
  • 05:00 EUR EU Finance Ministers Meeting
  • 05:00 EUR Eurogroup Meetings
  • 05:00 EUR GDP (QoQ) (Q3)
  • 05:00 EUR Retail Sales (MoM) (Oct)
  • 05:00 EUR Spanish Consumer Confidence
  • 07:30 USD Challenger Job Cuts (Nov)
  • 07:45 CAD BoC Gov Council Member Lane Speaks
  • 08:30 USD Continuing Jobless Claims
  • 08:30 USD Initial Jobless Claims
  • 08:30 USD Jobless Claims 4-Week Avg.
  • 08:30 USD Trade Balance (Oct)
  • 08:30 CAD Trade Balance (Oct)
  • 10:00 USD Durables Excluding Defense (MoM) (Oct)
  • 10:00 USD Factory Orders (MoM) (Oct)
  • 10:00 USD FOMC Member Quarles Speaks
  • 10:00 CAD Ivey PMI (Nov)
  • 10:30 USD Natural Gas Storage
  • 11:30 USD 4-Week Bill Auction
  • 11:30 USD 8-Week Bill Auction
  • 16:30 AUD AIG Construction Index (Nov)
  • 18:30 JPY Household Spending (MoM) (Oct)
  • 18:30 JPY Reuters Tankan Index (Dec)
  • 18:50 JPY Foreign Reserves (USD) (Nov) 

Friday Dec 6, 2019

  • 00:00 JPY Coincident Indicator (MoM) (Oct)
  • 00:00 JPY Leading Index (MoM) (Oct)
  • 02:00 EUR German Industrial Production (MoM) (Oct)
  • 02:45 EUR French Current Account (Oct)
  • 02:45 EUR French Trade Balance (Oct)
  • 03:30 GBP Halifax House Price Index (MoM)
  • 03:30 HKD Foreign Reserves (USD) (Nov)
  • 04:00 EUR Italian Retail Sales (MoM) (Oct)
  • 08:30 USD Average Hourly Earnings (MoM) (Nov)
  • 08:30 USD Average Weekly Hours (Nov)
  • 08:30 USD Government Payrolls (Nov)
  • 08:30 USD Manufacturing Payrolls (Nov)
  • 08:30 USD Nonfarm Payrolls (Nov)
  • 08:30 USD Participation Rate (Nov)
  • 08:30 USD Private Nonfarm Payrolls (Nov)
  • 08:30 USD U6 Unemployment Rate (Nov)
  • 08:30 USD Unemployment Rate (Nov)
  • 08:30 CAD Employment Change (Nov)
  • 08:30 CAD Full Employment Change (Nov)
  • 08:30 CAD Part Time Employment Change (Nov)
  • 08:30 CAD Unemployment Rate (Nov)
  • 10:00 USD Michigan Consumer Sentiment (Dec)
  • 10:00 USD Wholesale Inventories (MoM)
  • 13:00 USD U.S. Baker Hughes Oil Rig Count
  • 14:30 USD CFTC Speculative net positions
  • 15:00 USD Consumer Credit (Oct)

Saturday, Dec 7, 2019

  • 03:00 CNY FX Reserves (USD)

 

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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