Next Week

Next Week

Next Week

December 30, 2016

Holiday Closures: No holiday is more widely shared than New Years Day. Since such fall on a Sunday in 2017, most markets will be shut on Monday. New Zealand and Japan well remain closed Tuesday, and Japan’s markets will observe only a half day on Wednesday. Some markets like Spain and Italy will be observing Epiphany Day on Friday, January 6.

Central Banks: National Bank of Romania has a policy meeting scheduled. The FOMC and ECB release minutes of their last meetings. Lacker and Evans of the Fed speak publicly next week.

PMI Week: A slew of purchasing manager surveys covering manufacturing, the service sector, construction, retail, and non-oil activity get reported.

Scheduled U.S. Data Releases: Labor Dept statistics on employment, the jobless rate, hours worked and average hourly earnings spearheads a data calendar that also features construction spending, motor vehicle sales, the trade deficit, factory orders, the New York regional PMI (NAPM) and ADP’s estimate of private-sector employment. The usual assortment of weekly figures on jobless insurance claims, mortgage applications, energy inventories, chain store sales and consumer comfort also arrive.

Japanese Data: Monetary base, motor vehicle sales, and labor cash earnings.

Selected Other Asian Figures: Singapore GDP, Indonesian CPI, Hong Kong retail sales. South Korean and Malaysian trade. Thai consumer and producer prices. Indonesia’s CPI.

Euroland: Consumer prices, economic sentiment and retail sales.

Members of the Euro Zone: German unemployment, consumer prices and industrial orders. French consumer confidence, trade, and current account. Italian, Dutch and Cypriot CPIs. Irish industrial production, retail sales and unemployment. Portuguese consumer sentiment and Austria’s WPI.

U.K. and Switzerland: British money growth, shop prices, auto sales and unit labor costs. Swiss consumer prices.

Eastern Europe: Hungarian and Romanian producer prices. Czech and Hungarian industrial output. Romanian retail sales.

Australia and Turkey: Australian consumer confidence and trade. Turkish CPI and PPI.

Brazil, Mexico and Canada: Brazilian trade, PPI and industrial output. Mexican consumer sentiment. Canadian PPI, raw material prices, labor statistics and IVEY-PMI.

Copyright 2016, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

Tags: Economic Data Calendar




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Bitcoin Faces Familiar Resistance Level

Bitcoin Faces Familiar Resistance Level

The end of the year has seen Bitcoin broaching the $1,000 level for only the second time in its existence. Bitcoin reached its all time high of $1216 a over three years ago, facing the last level of resistance prior to crossing $1,000 at $980. That same level is now being tested again, and is proving to be resilient.

The TradingView chart below shows that $980 was tested and rejected soundly. Almost immediately upon hitting that historic resistance level a selloff occurred. Buyers bought into the weakness temporarily and attempted to test $980 again without success. Bitcoin is currently trading around the $965 level and has been volatile.

 

Short-term traders are in a tough position right now. Looking at the Relative Strength Index on the above chart, we can see several times that the previously strong indicator of 70 is no longer valuable information. Usually, 70 marks the opportunity to open a short position and sell into weakness. This is not currently the case and makes pattern trading nearly impossible. The same is true for the inverse of 30, which usually signals a long trade opportunity that can be sold into strength. We can see several times 30 was passed, which produced several different results. Volatility, typically a boon for swing traders, is unreliable at the moment.

Long-term traders are still in a good position. All of the previous catalysts remain in place, and suddenly the US Federal Reserve chairman Janet Yellen has shown she is willing to raise interest rates several times this coming year. Should the US Stock Market show weakness due to interest rate hikes, bitcoin stands to benefit. World volatility is also expected to rise with the ascension of populist US Presidential candidate Donald Trump.  President-elect Trump has engaged in substantial trade war and nuclear weaponry rhetoric before even taking office. Steady and explosive catalysts both remain in place.

The $980 resistance level has shown some strength, but fundamentally nothing has changed. The last 48 hours have still marked an advance from the $930 resistance level all the way to the current $980 levels. There is zero shame in profit taking however, do not be afraid to trim.

If you have any questions and comments on the commodities today, use the form below to reply.

Northland Wealth Management up for Four Family Wealth Report “made in Canada” Awards

Northland Wealth Management up for Four Family Wealth Report “made in Canada” Awards

Northland Wealth Management (CNW Group/Northland Wealth Management)

The honours are piling up for Northland Wealth Management, which is now a finalist in four Family Wealth Report Awards for 2017.  The company has been shortlisted in the following four categories: Best Canadian Multi-Family Office, Best Outsourced Chief Investment Officer,  Leading Individual (Multi Family Office) and Leading individual (Multi Family Office Executive).  The awards dinner will be held March 2nd.

Founded in 2011, Northland Wealth Management is an independent Canadian multi-family office and wealth advisory service with an open-architecture platform. Northland Wealth Management provides clients access to ‘institutional quality traditional and alternative investment opportunities’ and is  ‘dedicated to providing objective and comprehensive advice with a focus on financial and estate planning, family governance, closely held business and succession issues’.

In a press release announcing the recognition, Northland Wealth Management’s President, Paul Mascard, said the staff at the firm is proud of the industry recognition that the firm’s Chief Executive Officer and Chief Investment Officer, Arthur Salzer, has earned. housing

“It is due to Arthur’s vision, innovation and determination that Northland is the leading “made in Canada” family office – providing families of significant wealth tailored financial planning and industry leading investment services, delivered with transparency and without conflict,” said Paul Mascard.

Arthur Salzer commented that it’s a “true honour to have been shortlisted for these prestigious awards and be amongst the best and brightest in the field of wealth management.  This acknowledgement is a testament to the dedication of everyone at Northland Wealth to providing world-class service.”

The publisher of Family Wealth Report, Stephen Harris, congratulated the shortlisted firms, saying: “The firms who have been shortlisted in these awards are all worthy competitors, and I would like to extend my heartiest congratulations.  These awards are judged solely on the basis of entrants’ submissions and their response to a number of specific questions, which had to be answered focusing on the client experience, not quantitative performance metrics.  That is a unique, and I believe, compelling feature.”

The Family Wealth Report does analysis of the wealth management industry and provides “need to know” information straight to subscribers in its online publication.  The publication’s industry awards recognize three main areas: experts (individuals and teams), products and services for wealth managers and clients/institutions of all sizes and types.  Its judging process is conducted by an expert panel drawn from both private banks and trusted advisors/consultants to the sector.

Report publisher Stephen Harris adds that, “these awards will recognise the very best operators in the private client industry, with ‘independence’, ‘integrity’ and ‘genuine insight’ the watchwords of the judging process – such that the awards truly reflect excellence in wealth management.  Our aim is to make these annual Awards one of the brightest and keenly contested highlights in the wealth management calendar.”

Last June, Northland Wealth Management won the coveted ‘Portfolio Manager of the Year’ distinction at the 2016 Canadian Wealth Professional Awards. ‘Portfolio Manager of the Year’ is an award for excellence which recognizes the Canadian portfolio manager that delivered unparalleled performance to their clients.  When it received the award, Northland Wealth Management CEO Arthur Salzer spoke of the company’s “one-of-a-kind open-architecture platform [which] provides access to the alternative investment opportunities and managers utilized by the Canadian pension plans. This is not available for families through typical advisory channels.”

Northland Wealth Management was also a finalist in two other categories at last June’s gala event, which was attended by over 400 industry leaders.

U.S. Stocks Drop as Market’s Momentum Fades

U.S. Stocks Drop as Market’s Momentum Fades

Welcome to Evening MoneyBeat, WSJ’s closing-bell roundup of all the news and developments in the capital markets. To receive this newsletter, click here: http://on.wsj.com/MoneyBeatEveningSignup

HOW WE GOT HERE

U.S. stocks fell on Wednesday, as the market is not getting any lift from the usual end-of-year burst of buying. While the losses must be taken with a grain of salt given extremely low volumes on the exchanges, there is a growing sense that the market may have worn itself out.

Nobody’s going to be very worried about any of these modest losses right now, or even next week, when presumably “everybody else” gets back from an extended holiday break. But whether or not the Dow does finally at some point cross the 20000 level – it came with 20 points on Wednesday morning before the selling hit – traders and investors might want to take a deeper look at the economic dynamics.

“The one thing that Trump cannot do is make the population younger, and the one thing he will do is make America go deeper into debt, while at the same time pressuring the Fed to raise rates,” Gluskin Sheff economist David Rosenberg wrote in a note on Wednesday. “Aging demographics and a burdensome debt load have been the pervasive constraints on growth and will stay that way for some time to come.”

The bet since election day has been that with the GOP in control of both the White House and Congress, corporate America will have its traditional ally. Mr. Rosenberg’s point is that pro-growth policies will not be able to alter those wider economic trends. “Stimulating growth via fiscal policy at today’s ratio of debt-to-income will fall on its face no different than it has in Japan.” That may not factor into the market today, or next month, or next quarter, and Dow 20000 may yet be duly celebrated. But these dynamics are not just going to go away.

“Excessive debt burdens are still a pervasive constraint on growth,” he said. “And this is where Donald Trump’s fiscal plan is going to go awry.”

COMING UP

Data Front: International Trade in Goods (8:30 AM ET), Jobless Claims (8:30 AM ET), EIA Natural Gas Report (10:30 AM ET), EIA Petroleum Status Report (11:00 AM ET), Farm Prices (3:00 PM ET).

Fedspeak: Fed Balance Sheet (4:30 PM ET), Money Supply (4:30 PM ET).

MONEYBEAT PODCAST

Paul Vigna, Ben Eisen, and Sarah Krouse talk the slow-down toward Dow 20000 amid an exceedingly quiet holiday season. Then, the Wall Street Journal’s Andrew Tangel joins the show to talk what a new high for the U.S. dollar means for the manufacturing sector.

TWEET OF THE DAY

Advanced Training: Momentum Trading

Advanced Training: Momentum Trading

The Strike 3.0 tools are used for two different strategies:

  • Strike 3.0 Momentum Strategy
  • Strike 3.0 Reversal Strategy

In this training we will be discussing the Momentum Strategy. Next month, we’ll look at the Reversal Strategy.

What Is Momentum?

Investopedia.com defines momentum as:

The rate of acceleration of a security’s price or volume. In technical analysis, momentum is considered an oscillator and is used to help identify trend lines.

http://www.investopedia.com/terms/m/momentum.asp

 

NZDUSD Momentum ExamplesWhen momentum occurs early in the movement of price, it is a good indicator of the direction in which you want to enter your trade. As momentum continues and progresses, price will push past the point at which you want to enter and will become overbought or oversold. That’s the point at which you should expect price to begin to reverse.

Early momentum is the time at which the “smart money” or professionals will be entering the move. Late momentum is the time when the public gets wind of the move and they start to load on. Late momentum is when the “smart money” is expecting a reversal.

 

How Can We Measure Momentum?

Momentum can be measured using several different technical indicators:

  • Price Action
  • Simple Trend Lines
  • Moving Average Convergence Divergence (MACD) – trend-following momentum indicator
  • Relative Strength Index (RSI) – momentum indicator that compares the size of recent price gains/losses over time to measure speed and change of price movements
  • Intraday Momentum Index (IMI) – combines candlestick analysis with RSI
  • Bill William’s Awesome Oscillator – Similar to the MACD

As anyone who’s been in our trading room for a few days probably already knows, our Strike 3.0 tools use the RSI indicator to measure momentum. The Strike 3.0 exhaustion tools are a very convenient way to see instantaneous momentum on all time frames as well as historical momentum on the primary time frames simultaneously. We have developed our very profitable momentum trading strategy around these tools using price action for confirmation of entry.

The Strike 3.0 Momentum Strategy

 

The Strike 3.0 Momentum Strategy uses the Strike 3.0 Scanner, Strike 3.0 Exhaustion and Strike 3.0 MultiTrend indicators in addition to price action to find trade entries.

 

  1. Strike 3.0 Scanner SignalFinding a trade entry begins with the Strike 3.0 Scanner. The scanner will provide an alert to a currency pair that is showing momentum on the 15 and 30 minute time frames (default.) If the scanner alert is set on, the scanner will sound and the pair name will change from black to green to indicate a signal on that particular pair. The arrow itself may disappear, but the pair name will remain green for 30 seconds (by default.)
    The signal on the scanner is only the first of many steps to determine whether you have a valid, tradeable signal. Don’t enter a trade just because the scanner alerted you. The next step:
  2. Fresh Signal ExampleEither the M30 (30 minute) or the M15 (15 minute) signal must be “fresh”. A fresh signal is determined by looking at the Strike3-Exhaustion historical exhaustion tool. One or both of these indicator bars at the bottom of the chart must show gray in one of the last two prior candles. Gray represents neutral RSI for that time frame (between 40 and 60.)  Either time frame signal may pop on and off as the candle moves up and down. The signal will still be valid.
  3. Multitrend Reversal Signal ExampleBefore you enter the position, be sure there are no Reversal signals appearing on the Strike3-MultiTrend indicator on time frames smaller than the Daily time frame (1M – 4HR.) Reversal signals on the daily and weekly time frames typically don’t affect the shorter term time frames that we are trading.
    Reversal signals appear on the Strike3-MultiTrend indicator in the Exh column (the right-hand column) in the form of a dark green up arrow or a dark red down arrow with a number to the right of it.
  4. Example of Rule 4 - Pushing through a levelPrice must breach (push through) a prior support/resistance level. This can be in any of the following forms:
    • Current or Prior High or Low of the day (Strike3-Levels tool.)
    • A moving average
    • Weekly or Daily Support/Resistance level
    • Psychological level – also known as a big level or big number – price ending in 0 – the more 0s the better. The Strike3-Levels tool shows the 00 and 50 levels.
    • Prominent support/resistance level on a shorter time frame.
  5. Example of Rule 5 - Too Close to Another PositionPrice should not be near another open position on the pair. I define “near” as either in profit or within 20 pips of the entry price. This will protect you from too much risk.
  6. Example of Rule 6: Enough Space for ProfitThere should be enough space for profit between the trade entry and the nearest Prior HOD, Prior LOD, support or resistance. For the purposes of this strategy, I define enough profit as 8 to 10 pips. The reason for this rule is that price could stall or take a bounce at these levels and we may want to close the trade here if it does. Price may push right through these levels making this rule moot.
  7. Example of Rule 7: No Red-tagged eventsNo scheduled “red-tagged” upcoming data release (within the next hour or so) or past data release (within the last 15 minutes) on either currency in the pair. Red-tagged data releases can rock the market and whip the price around quite a bit causing “false” signals. I use forexfactory.com to identify red-tagged news events.
  8. The spread on the pair to be traded should be somewhere near normal for that pair and your broker. Normal spread will vary depending on the pair and the broker. Commissioned brokers will typically have lower spreads than non-commissioned brokers. Exotic pairs (e.g. GBP/SGD) will typically have higher spreads than the major pairs (e.g. EUR/USD.) Spreads typically increase (and can increase dramatically) during news events, data releases and even at session opens and closes. Know what the typically spreads are for your broker and your favored pairs.
  9. Target 20 – 30 pips (20 – 50 pips for a GBP pair) – place the target ahead of a Support/Resistance area. Look for a support or resistance area around 20 – 30 pips away and place the target 2 or 3 pips ahead of that area (depending upon the spread and direction.) The GBP pairs typically move farther and faster than the other pairs, so pushing the target out to 40 or even 50 pips is acceptable. Place the target AHEAD of a S/R level so the market doesn’t have to do any “work” before hitting your target. Use smaller targets during slow market times.

Trade Management

The momentum strategy works best during the early New York and London sessions. I have had the best success entering trades between 7am and 11am New York Time.

Keep your size small. I recommend no more than one micro-lot per $500 to $1000 in your account. This will allow you to let the trades swing – and allow you to trade multiple pairs on the same currency without excessive risk.

I don’t use hard stop losses. I use the Strike3-Money tool (which closes all positions on a pair when the loss exceeds the specified amount) to be sure I don’t exceed my risk. It makes calculations much easier. I do, however, reduce the size of my position by approximately ½ to reduce risk if it goes more than 100 pips against me. I will cut the trade off completely if it goes more than 150 pips against me. So size the trades accordingly.

We don’t get married to the target. Some strategies require that you hold for your target because you have to hit it for statistical reasons. The Strike 3.0 Momentum Strategy has no such requirement. When the trade is in decent profit (8-10 pips or more), close the trade if price seems to be stalling or reversal signals start showing on the board. Just be sure you are closing the trade because you objectively believe price action is stalling – not because of any emotional reason. Study charts extensively to understand how price moves. You may not always be right, but you’ll have profit. And don’t worry if it goes on and hits the target, you’ve got your profit, move on to the next trade. That will keep you from getting ulcers.

Summary

The Strike 3.0 Momentum Strategy works best when there is a lot of activity in the market. Typically you shouldn’t have to hold a position more than 24 – 48 hours.

This is the way I trade the momentum strategy, however, trading is very personal. You don’t have to do it the way I do, but I suggest you start doing it this way to find out what works for you and what doesn’t. Once you understand the underlying concepts, you can modify the rules to fit your style.

Be sure to learn and practice on a demo account. My piano teacher used to tell me “Don’t practice until you get it right, practice until you can’t get it wrong.” Once you have the platform skills and strategy skills and are profitable on demo, then do it on real money.

If you’re interested in more information about our Strike 3.0 tools and trading room, take a look at our 14-day trial.

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Crude holds near annual peaks, awaiting OPEC cuts

Crude holds near annual peaks, awaiting OPEC cuts

Crude oil prices edged up for a fourth consecutive session on Wednesday, close to their peaks since mid-2015, with the market awaiting evidence of OPEC supply reductions in the new year.

International Brent  crude futures were up 12 cents at $56.21 a barrel by 1248 GMT (7:48 a.m. ET). Brent hit $57.89 on Dec. 12, its highest since July 2015.

U.S. benchmark West Texas Intermediate (WTI) crude oil prices  were up 7 cents at $53.97 per barrel, not far from the year’s high of $54.51 reached on Dec. 12. 

Oil prices have gained 25 percent since mid-November, helped by expectations for OPEC’s supply cut and solid U.S. economic figures that have also bolstered equity prices.

Trading is expected to remain thin this week ahead of the New Year holiday. 

The market is taking a wait-and-see approach to the official start of the landmark deal reached by the Organization of the Petroleum Exporting Countries (OPEC) and several non-OPEC members to reduce their output. The deal is set to kick in from Jan. 1. 

OPEC and non-OPEC producers are expected to lower production by almost 1.8 million barrels per day (bpd), with Saudi Arabia, OPEC’s largest producer, agreeing to bear the lion’s share of the cuts.

Iraqi Oil Minister Jabar Ali al-Luaibi said on Wednesday his country, which has seen fast production growth in the past two years, would cut supply by 200,000-210,000 bpd from January.

Luaibi said on a visit to fellow OPEC member Kuwait that he saw oil prices rising to $60 per barrel as the cuts would help ease the global glut of the past three years, according to Kuwait News Agency (KUNA).

“There are mixed expectations of the cuts, trading is thin so the first two weeks of January would be critical to watch,” said Michael McCarthy, chief market strategist at Sydney’s CMC Markets. 

“If there’s any misstep or any indication of disagreement to (the deal), we would see crude prices dropping,” he said. 

Iranian oil minister Bijan Zanganeh also said on Tuesday he expected OPEC to abide by the deal. “While competing, we do have engagement,” Iranian news agency Shana quoted him as saying.

OPEC member Venezuela also said it will cut 95,000 bpd of oil production in the new year.

Russian oil producer Gazprom Neft said it planned to boost oil output by 4.5% to 5% next year, less than it had intended before Russia, one of the non-OPEC member countries, joined a deal to cut supply.

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