Chinese Manufacturing PMI came in Saturday with a miss at 49.8 – again signalling that the world’s “economic power house” is now in contraction, so I wouldn’t be expecting a big “up day” tomorrow morning.
One needs to “completely ignore” the current slew of media headlines as every Central Bank / manipulated media outlet on the planet is on “full alert” to do whatever they possibly can to assure the general investment community that “all is well – there is nothing to worry about at all”. Right.
European stocks have had their “booster shot” due to the QE announcement from The ECB, but have now been rejected at the previous highs.
$FTSE_Feb_1_Forex_Kong
As totally frustrating as the last few weeks ( if not months ) of trading has been, we’ve now seen the injection of another “trillion” in proposed asset purchases and still…..even still – markets can’t move any higher. Tops are long, tops are drawn out, tops are a pain in the ass but……now with The ECB “done” – seriously…….what’s left from the CB’s to push this thing any higher? Zip.
EUR / USD finally showing solid signs of bottoming / finding a low.
EUR_USD_Feb_1_Forex_Kong
Interesting to note The CRB Commodities Index, as one could entertain the scenario that money comes out of ridiculously bloated / bullshit pumped up stocks, and flows into commodities.
$CRB_Feb_1_Forex_Kong
The U.S Dollar rampage should conclude here pronto – as it’s exhausted to say the least. Two “doji candles in a row” signalling obvious “indecision” and with commodities looking to bottom out we understand the correlation. A weaker US Dollar ( finally ) = rising commodity costs.
$USD_Feb_1_Forex_Kong
The SP 500 along side “risk in general” has been weak for some time now…but still hasn’t “kicked off” on any kind of lasting downtrend. The whipsaws / sideways trading has been a pain, but all with conclude here shortly.
Even if The SP “does” get a bounce to around 2040 area…it doesn’t make a hair of difference medium term. The next leg down will bring tears to your eyes, fear to your wife and a fat hole in your account should you decide to stay the course.
$SPX_Feb_1_Forex_Kong
The Canadian TSX as well as virtually all equities indexes globally are about to take the pain as The Nikkei ( suggested to reverse a few days ago ) has also hit overhead resistance and now looks to dump.
Currency wise little has changed really – as the general theme of long JPY vs the commodity currencies as well short USD vs E.U currencies still stands.
German DAX set a new high but seems to be tiring out. Thanks for these nice charts and your explanations!
Kong,
I am a moron with charts but you make them crystal.
Hope all is well with you,
Kerry
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Hi Kerry. Thanks.
I’ve been a bit lazy with the charts lately, as these damn markets have been moving sideways for some time now. I apologize for that, and will plan to get back on them more regularily.
I would recommend that in your spare time you look into studying / learning “Japanese Candles” ( a quick search at google ) as this can really help. It really doesn’t take much time at all, and you can really get a good idea of what’s happening day to day.
I’ve been a moron these days with respect to my marketing timing so there is always an area to improve on.
I hope you are out having fun! Take care!
oh man.. so DAX is the new s&p/nikkei now goes up and up
Hi Kong,
Whats your take on the price action this week so far (I know it’s only day two of week). Equity markets have snapped back hard since Mondays lows and Dax is now defying gravity based on nothing in so far as I can see. Looks like the new norm is that oil has bottomed and this is good for risks. I can’t see any reason for the rally so what’s your take? We are beginning to see false rumors about Greece again (all spun positively to invoke a rally everytime equities start to fall).
The usual barometer of risks ie. commodity currencies all falling against JPY yet YEN is being kept above the critical USDJPY level of 117.00. Any attempt to close below this is being met with solid buying. Looks like any time the equity markets start to fall, we are seeing USDJPY being ramped up.
Seeing lower highs and lower lows on US equity markets so until last high is breached, we wont see the start of another leg up.
Clean break over 2040 on the S&P and the most insane day for volatility on the Commodity crosses, it was truly a day trader’s dream!
USD/JPY can’t seem to want to lose 117 and market may be off to new highs. Any change in outlook now that the S&P closed at 2050 now Kong? The market continues to be like trying to hold a balloon under water.
All moving exactly according to plan…..just taking a couple weeks longer than expected.
2040….2050 – who cares / splits these hairs – not me.
I don’t see new highs – I see us dumping hard.
USD/JPY losing 117..and global risk sentiment along with it.
Better it happens this month as ECB will start printing money on 15th March. German DAX doesn’t take any prisoners and seems totally decoupled from US.
Hi Kong,
Well US equities bounced near 5% since Mondays lows – last hurrah or new highs on the way?
I’ve been keeping an eye on cadjpy of late. Has fallen 1400 pis since its recent 106.00 high. Dreadful data coming out of Canada and the surprise rate cut means we could be seeing more of these from then. Is cadjpy consolidating at current levels to start an attack on lower 90.00 level and below or can we expect a pull up to 9600/9700 area first?
Commodity currencies have bounced this week from their lows, helped by oil no doubt that seems to be trading in 5% moves these days.
BS data coming out and a market rally ensues. Not very bearish. How long will this go on?
Not very much longer.