Fed to Markets: The Balance Sheet Wind-Down Will Be Like ‘Watching Paint Dry’

Fed to Markets: The Balance Sheet Wind-Down Will Be Like ‘Watching Paint Dry’

Morning MoneyBeat is the Journal’s pre-market primer. To receive this morning newsletter via email, click here: http://on.wsj.com/MoneyBeatUSSignup OVERNIGHT DEVELOPMENTS Futures pointed to a 0.2% opening loss for the S&P 500, which would take U.S. stocks down a notch from the all-time highs achieved Friday. The Stoxx Europe 600 fell 0.3%, led by falls in the telecom […]

AUDUSD approaching major resistance, prepare to sell

AUDUSD approaching major resistance, prepare to sell

Sell below 0.7454. Stop loss at 0.7476. Take profit at 0.7397.
Reason for the trading strategy (technically):
We prepare to sell below 0.7454 resistance (Fibonacci extension, Fibonacci retracement, horizontal pullback
resistance) for a drop towards 0.7397 support (Fibonacci retracement, horizontal overlap support).
Stochastic (21,5,3) is seeing strong resistance at 95% level where we expect Stochastic to rise to before seeing a
reaction.
Correlation analysis: AUDUSD has a strong positive correlation with NZDUSD which means they usually move
together. We are expecting a rise on AUDUSD and a rise on NZDUSD which goes in line with this correlation.

AUDUSD

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Interesting Trend Following Stock TEAM

Interesting Trend Following Stock TEAM

Interesting Trend Following Stock TEAM

There are always stocks moving up and down…One thing to look for are stocks that move up and then pull back….As well as areas  of consolidation. Team is a nice example of trend following stocks. Team is rather extended…but might want to put on your watch list of trending following stocks.

 

World Out Of Whack: 3 Events, All Tied. Can You See The Trends?

World Out Of Whack: 3 Events, All Tied. Can You See The Trends?

Well done!

To the Donald…

Too true Donald. These guys are filthy rich. In fact, if Justin Bieber lived out there, they’d put him on income support.

Fighting words those. Bow wow, woof, woof. Grrrr!

Disgraceful… this bowing thing. Elect me, and I’ll show ’em.

Aaaand…. tamed!


POTUS caught curtseying.

Is that Trump or Hillary bowing? They use the same hair dye, and increasingly there seems little to distinguish them apart. The man is as steely, resolute, and determined as a bowl of yoghurt.

In his Saudi speech the Donald refused to utter the words “radical Islamic terrorism”. You’ll recall that this was a term he had endlessly berated President Obama for failing to use. He went as far as to call Islam “one of the world’s great faiths”. Trump supporters’ heads must have exploded.

For everyone else… the brilliance coming from Washington never ceases to disappoint.

Ramifications?

For the stock market… here’s the iShares US Aerospace & Defence ETF:

A $110 billion weapons deal worth over $350 billion over 10 years which Hillary Trump just signed will have that effect. The establishment rice bowls will be filled after all. Whew! Rumsfeld and Cheney must be relieved.

As for the electorates faith in the political system…

Well, let’s see… $350 billion in advanced weaponry to the barbaric, medieval regime that chops of more heads than ISIS.

You tell me.

Intricately Tied to It

Over in Manchester, a Libyan refugee Salman Abedi, after having read a poorly written medieval science fiction book and thus under the delusion of paradise and 40 virgins, blew himself to smithereens taking with him 22 innocent people who were out enjoying a night’s music.

How is this intricately tied?

Last year, I explained the actions and consequences to this question:

“According to a group of human rights organisations, the body count from the wars in Pakistan, Afghanistan, and Iraq – all part of the ridiculously named “war on terror” – stands at over 2 million.

Let’s think about this for a minute. Consider how many close friends and family you have. Let’s put the number at an even 50. Remember also that culturally Muslims have an average of 4 children rather than the European 1.5 average and factor in that a good portion of this group practice polygamy – taking 4 wives and having 16 rather than 4 children – and this number is likely pretty conservative.

For every person killed (and this can be directly or simply as a result of Western intervention) we have therefore a further 50 friends and family. So now we have 2 million multiplied by 50 which is 100 million people. What percentage of those 100 million people blame the West for the death of a loved one? It’s higher than zero, that much I know.

Now some portion of those 100 million people have been invited with open arms into Europe, and we’re not even mentioning soldiers who’ve fought against any of the Western-led military campaigns. Many of them too have made their way into the homelands of the “infidels”.

Imagine for a minute being invited to a party at the home of someone who you believe had a hand in the slaughter of your family. That is unfortunately how many feel. We don’t need to imagine this, we know it because they have told us this.

I’m not making a judgement call here just pointing out the obvious.

European politicians seem to have a shockingly dim understanding of this dynamic, which on it’s own shows a naivety befitting a 5 year old schoolgirl.

You cannot directly, or indirectly, kill two million people, invite their relatives home and expect no blowback. That’s beyond stupid. It’s suicidal.”

And then only a month ago, I wrote about what the silent majority is really saying:

“While afraid to say so publicly how many in private think: is it not time to bring in the military, round them all up, put them on a ship with a jammed rudder and aim it at North Africa?”

This number grows each day, and today – just days after this Manchester attack – the number of people thinking these thoughts is exponentially higher than it was at the beginning of the week. This is how trends and consensus form. Ignore it at your peril!

And while I’ve been explaining behavioural economics and this social dynamic in my little corner of the web, I’ve been arguing that it will increasingly become mainstream with profound ramifications.

And here we have one such case. It doesn’t get much more mainstream than Morrissey himself. Read it carefully.

On a more positive note, I sure hope you’re following this.

The Belt and Road

A week before Chairman Trump and Salman bin Abdulaziz Al Saud sat down to lobster bisque, roast swan stuffed with oysters, and sautéed slave to discuss how many Yemenis could be wiped out with the brand spanking new US bombs, President Xi hosted leaders from around the world pushing ahead with China’s ambitious OBOR project.

One can conquer by force or by trade – a point worth remembering.

With trade comes influence – political, economic, and social.

Consider what’s happened in just 40 years.

Forty years ago, China was a backwater – nothing of a place inhabited by little brown people in straw hats rummaging around in garbage cans wearing clothing that looked like they’d been nicked from the film set of Schindler’s List.

If you were lucky, you’d spot a moped but it had probably run out of fuel because nobody could afford anything more than soup. And since nobody had invented a moped that ran on soup, it wasn’t going anywhere.

Today, not only does China produce an avalanche of goods but they are rapidly becoming a formidable consumer themselves. In terms of influence consider that they are now:

  • Asia’s largest trading partner
  • US largest trading partner
  • Germany’s largest trading partner
  • Australia’s largest trading partner
  • Russia’s second largest trading partner (after Germany)
  • Africas largest trading partner
  • South America’s largest trading partner

China has, over this 40 odd years, built up some impressive things. Among them a credit bubble, which will need to be dealt with but also substantial foreign exchange reserves, most of them held in US government debt securities. Trading those securities for influence, and dare I say it inflation protection, will translate into revenues to the Middle Kingdom. This is the plan… and it isn’t a bad one.

They sure could do worse. They could sell bombs to the most hated family in the Middle East, and when the inevitable backlash takes place, then turn around and say with a straight face.

Question


– Chris

“The supreme art of war is to subdue the enemy without fighting.” — Sun Tzu, Chinese

18 Reasons to Drink Coffee for Your Health

18 Reasons to Drink Coffee for Your Health

Often, the foods and beverages people love the most are unhealthy and should be consumed only once in awhile. Coffee, however, appears to be a rare exception. One of the most popular beverages in the United States, coffee also has a number of health benefits — which, in some cases, increase as consumption goes up.

According to a 2015 Gallup survey, nearly two in every three American adults drink at least one cup of coffee a day — translating to an estimated $74.2 billion in annual consumer spending. Many of those same adults are at a significantly lower risk of a number of sometimes fatal diseases and conditions than those who abstain or who do not drink much coffee.

24/7 Wall St. reviewed medical research findings from a range of journals and sources to identify 18 health benefits of drinking coffee. The benefits range from a reduced risk of heart disease, the leading cause of death in the United States, to an improved mood and reduced risk of depression.

Click here to see 18 reasons to drink coffee for your health.
Click here to see our detailed findings and methodology.

Next Week

Next Week

Next Week

May 26, 2017

Numerous Holidays: U.S. Memorial Day and late spring bank holiday in the U.K. on Monday. Dragon Boat Festival in China (May 28-30) and Hong Kong (Tuesday). Pancasila Day in Indonesia on Thursday and Italy’s Republic Day on Friday.

Central Bank Action: Policy meetings in Israel and Brazil. Release of Federal Reserve Beige Book and Bank of Mexico policy meeting minutes. European Central Bank President Draghi and Bank of Japan Board member Harada deliver speeches. San Francisco Fed President Williams and Dallas Fed President Kaplan also speak publicly during the week.

Event: The summit of G7 leaders wraps up May 27, President Trump returns to Washington, and a frenzied parade of accusations and counter-threats will resume between his administration and its critics. Look for many White House tweets.

A Slew of Manufacturing Purchasing Manager Surveys: Covering conditions in U.S., Canada, Brazil, Mexico, Euroland, Germany, France, Spain, Italy, Ireland, Greece, The Netherlands, Spain, Great Britain, Switzerland, Sweden, Russia, Norway, Denmark, Hungary, Czech Republic, Poland, China, Malaysia, Thailand, Vietnam, Indonesia, South Korea, Taiwan, India, and Turkey.

Scheduled U.S. Statistical Releases: Personal income and spending, the PCE price deflator, the Dallas Fed manufacturing index, the Chicago PMI, the New York PMI (NAPM), motor vehicle sales, the trade balance, the ADP estimate of private job creation, the Labor Department monthly jobs, unemployment and hourly wages report, construction spending, the Case Shiller house price index, pending home sales, quarterly labor productivity and unit labor costs, and weekly jobless insurance claims, consumer comfort, chain store sales, mortgage applications and energy inventories.

Japanese Data: Industrial production, retail sales, real household spending, unemployment, small business sentiment, auto production and sales, housing starts, construction orders, consumer confidence, the monetary base, and quarterly investment, sales, and corporate earnings.

Selected Other Asian Statistics: South Korean industrial output, retail sales, consumer prices, trade balance and manufacturing sentiment. Malaysian, Singaporean and Thai producer prices. Indonesian and Thai consumer prices. Hong Kong retail sales, Indonesian CPI, and Thai trade balance.

Euroland: Economic sentiment, consumer prices, producer prices, unemployment and money and credit growth.

Members of the Euro Area: German retail sales, import prices, unemployment and CPI. French GDP, CPI, PPI, consumer sentiment and consumer spending. Italian CPI, PPI, unemployment and GDP. Spanish retail sales, CPI, unemployment, and current account. Finnish, Greek, Belgian and Portuguese GDP. Finnish and Portuguese consumer confidence. Greek and Portuguese retail sales. Portuguese business sentiment and Austrian unemployment.

U.K. and Switzerland: British M4 money growth, construction purchasing managers index, consumer confidence, shop price inflation, and Nationwide home price index. Swiss GDP, retail sales, ZEW expectations index of investor sentiment, UBS consumption indicator, and index of leading economic indicators.

Nordic Europe: Norwegian and Danish unemployment. Norwegian and Swediah retail sales. Iceland’s CPI and PPI. Swedish and Danish GDP. Sweden’s trade and current accounts.

Eastern Europe: Polish and Czech GDP. Hungarian producer prices.

Australian and New Zealand: Australian and New Zealand building permits. Australian retail sales, new auto sales, private credit growth and private investment. New Zealand business sentiment and terms of trade.

South Africa and Turkey: South African unemployment and money growth. South African and Turkish trade balances.

Canada and Brazil: Canadian March and 1Q GDP, 1Q current account, 1Q productivity and unit labor costs, and monthly producer prices and trade balance. Brazilian GDP, industrial production, trade balance and unemployment.

Copyright 2017, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

Tags: Economic Data Calendar




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Market Wrap Up

Market Wrap Up

Highlighted Market Movers

DECK +18% Announced Earnings. Beats on EPS and Revenue

AFSI +12% Receive Proceeds of $300 million of Common Equity Capital From Private Placement

SPI -33% Continued volatility in name

ZOES -12% Announced Earnings, lowered guidance

Options Activity

MAR.. OCT 105 CALL Activity .. 22,500 @$6.40 on the BID .. Expire OCT 20

AXL..OCT 13 PUT ACTIVITY ON THE OFFER @ 0.70 ..1700..EXPIRES OCTOBER 20

HTZ.. OCT 7.5 PUT Activity .. 3k+ @$0.90 on OFFER.. Expire OCT 20

GPRE.. SEP 24 CALL Activity .. 1950 block @$1.25 on OFFER.. Expire SEP 15

GNW.. SEP 4 CALL Activity .. 7300 block @$0.48 on OFFER.. Expire SEP 15

Highlighted Intraday Noteworthy Headlines

VAL/SHW– Sherwin-Williams Receives Regulatory Approval To Complete Its Acquisition Of Valspar Expected To Close On June 1, 2017

CMG– Chipotle Mexican Grill Reports Findings from Investigation of Payment Card Security Incident

CYOU– Changyou.com Announces Formation of Independent Special Committee to Review Preliminary Non-Binding Proposal to Acquire the Company

GRMN– Garmin® to appeal ITC initial determination

Social Media and Desk Chatter Information

NVDA .. Talk circulating Softbank looking to raise stake in company.. Circulating across social media

IMAX .. Chatter being circulated…involving Sony

KITE– Kite Receives U.S. Food and Drug Administration Priority Review for Axicabtagene Ciloleucel

Insider Transactions and Company Filings

OOMA .. FORM 4 CFO P    3,000  A  $ 8.295

SPKE.. FORM 4 .. DIRECTOR P    3,807  A  $ 43.13

PES.. FORM 4 .. CEO P    25,000  A  $ 2.74

SXCP.. FORM 4 .. 10% Owner (SUN COAL) P 45,900  A  $ 17.1371  .. pursuant to a Rule 10b5-1 trading plan adopted by Sun Coal & Coke LLC on May 1, 2017

About the Author

The TradeXchange is an online financial media outlet delivering real-time, high-priority, actionable information traders need to make quick and informed decisions. Visit Thetradexchange.com.