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Macro

GUOSEN Closing Bell (July 20)


MARKET

Chinese stocks suddenly surged, amid market rumor of easing asset market regulation and lowering RRR. Given the fact that the fundamentals are still quite strong, we think the market correction, which already down 20% from previous high is mainly sentiment driven. The new regulation in asset management industry and potential real estate tax have all contributed to recent weak sentiment in mainland securities market. That afternoon surge, lending by those debt fueled industries might indicate the turning point is arriving. Bank and Non-bank Financial sectors led the gains, while no sector fell. Combined turnover for both markets was CNY 348.2 bn, up 12.03% dod.

 

 

Close

% Change

Vol (bn CNY)

%YTD

Shanghai

2829.27

2.05

155.66

-14.45

Shenzhen

9251.48

1.12

192.70

-16.20

CSI 300

3492.89

1.88

122.20

-13.35

ChiNext

1609.55

1.23

68.34

-8.16

 

Sector

Top 1

Led by

Top 2

Led by

Upward-leading

Bank

601838

Non-bank Financial

000416

Downward-leading

 

 

 

 

 

NEWS

*The yuan wiped out a steep retreat on Friday amid speculation officials were seeking to cool declines. (Bloomberg)

*Consumer spending records robust growth in H1. China's consumer spending was robust in the first half year, contributing 78.5 percent to the country's economic growth, up 14.2 percentage points from a year earlier. (China Daily)

 

FUND FLOW

Click here for more information about Guosen.

This article is from Guosen Securities Co., Ltd. and is being posted with Guosen Securities Co., Ltd.’s permission. The views expressed in this article are solely those of the author and/or Guosen Securities Co., Ltd. and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


19210




Technical Analysis

Wheat (ZW) Breaking 2 Month Descending Wedge Resistance


Wheat (ZW) surged almost 2% yesterday, breaking above a descending wedge resistance (on the 4hr and daily chart).  All the agris on my Watchlist are now recovering after being deeply oversold this past month due to the US-China trade war.  The still downsloping weekly MACD will keep most bulls away, but aggressive traders will begin anticipating a flattening of the weekly MACD green line which could quickly occur within a few strong up days.  Aside from the weekly MACD, the weekly, daily and 4hr RSI, Stochastics and MACD are bottomish, rallying or consolidating recent gains.  I am flat after profitably closing longs yesterday and am looking to re-enter long in the green zone (of the daily chart), targeting the red zone for early next week.  The amber/yellow zone is where I might place a stop if I was a swing trader (although in my personal account with which I seldom hold overnight I set my stops tighter).
 
Wheat (CME ZW Sep18) Weekly/Daily/4hr
 
 
Click here for today's technical analysis on Corn, Soybean
 
Tradable Patterns was launched to demonstrate that the patterns recurring in liquid futures and spot FX markets can be analyzed to enhance trading performance. Tradable Patterns’ daily newsletter provides technical analysis on a subset of three CME/ICE/Eurex futures (commodities, equity indices, and interest rates), spot FX and cryptocurrency markets, which it considers worth monitoring for the day/week for trend reversal or continuation. For less experienced traders, tutorials and workshops are offered online and throughout Southeast Asia.

 

This article is from Tradable Patterns and is being posted with Tradable Patterns’ permission. The views expressed in this article are solely those of the author and/or Tradable Patterns and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


19208




Macro

Rumours Of State Intervention Limit Yuan Losses


Morning Briefing July 20th 2018


A quiet Friday is on the cards with most of the data releases out of the way early, resulting in a very quiet afternoon.

The calendar gets underway at 0600GMT, with the release of Germany's Producer Prices. Previously, the PPI y/y figure rose by 2.7%.

Up next is the Euro Area current account data at 0800GMT. The previous release revealed a surplus of EUR 28.4bn.

The UK Public Sector Finances data is due at 0830GMT. Public sector net borrowing excluding banks is expected to remain unchanged in June, at stg5bn.

The Euro Area's government debt figure will be released at 0900GMT. Previously debt as a percentage of GDP stood at 86.7%.

St Louis Fed President James Bullard is set to speak in Glasgow, KY from 1220GMT.

Canada's CPI and Retail Trade data is at 1230GMT. The headline y/y CPI figure is expected to rise a touch from 2.2% previously to 2.3%. Retail Sales is expected to grow by 1.0% after previously declining 1.2%.

On Saturday and Sunday, ECB Governing Council member Jens Weidman and Mario Draghi will speak at the G20 Central Bank Governors meetings in Buenos Aires.

Global Economic Trading Calendar


Markets


SNAPSHOT: Below gives key levels of markets in the second half of the Asia-Pac session: - Nikkei 225 down 143.13 points at 22622.23 - ASX 200 up 21.698 points at 6284.4 - Shanghai Comp. down 3.345 points at 2769.2 - JGB 10-Yr future up 4 ticks at 150.98, yield down 0.5bp at 0.037% - Aussie 10-Yr future up 3.5 ticks at 97.375, yield down 3.9bp at 2.618% - U.S. 10-Yr future unchanged at 120.09+, yield up 0.74bp at 2.8454%

US TSYS: T-Note futures operate around Thursday's settlement, after a trip higher on the back of risk off flows stemming from a softer Yuan fixing from the PBOC, which saw the yuan crosses spike higher, before they retraced a large part of their gains, seeing Tsys move back to near unchanged levels. - The following notable options trade was observed: Block trade: TYQ8 120.0-120.5 call spread 10.K blocked at 0.12, market quoted 0.14-0.15 on screen at the time. - The Eurodollar strip is largely unchanged.

JGBS: JGB futures have consolidated Thursday's overnight session gains and operate just below a key resistance area, with the risk off flows stemming from the PBOC's yuan fix supporting the space. - There was little reaction to Japan's CPI release, with 10-Year break-evens sticking to a narrow range.

AUSSIE BONDS: The space moved back to the SYCOM highs on the back of risk off flows stemming from a softer Yuan fixing from the PBOC, which saw the yuan crosses spike higher, before they retraced a large part of their gains, with Bonds holding around best levels. - The domestic 3-/10-Year yield differential last trades around a little under 1.0bp flatter at 52.3bp, after registering a low of 50.9bp. The AU/U.S. 10-Year spread continues to operate sub -20bp. - The AOFM's issuance schedule revealed that there will be no issuance next week, remember this week saw the launch of the new 2.75% 21 May 2041 Bond. - 3-Month BBSW fixed 0.9bp lower today, with the bill strip trading marginally mixed last.

STOCKS: Risk assets took a hit as sentiment was dented on the back of the softer CNY fixing from the PBOC, which added additional pressure to the Chinese currency, although all of the major benchmarks have recovered from session lows, as the yuan operates off of worst levels. - The ASX 200 was the outperformer, adding 0.4%, although the heavyweight materials sector recorded losses of over 1.0%, limiting upside potential. - U.S. index futures were more reluctant to retrace their losses and continue to operate around worst levels.

OIL: Oil traded back to unchanged levels overnight, as risk sentiment was dampened by a fall in the Chinese yuan, pushing crude away from the early session highs. - Oil rose on Thursday as Saudi Arabia pledged to not "over-supply" the market.

GOLD: Gold was the one the outlier, as it failed to benefit from risk off flows stemming from a softer yuan fix from the PBOC, and operates around session lows just shy of $1220/oz last.

FOREX: The Chinese Yuan was the driving force overnight, as a softer PBOC fix propelled both the USD/CNH & USD/CNY crosses above their respective Thursday highs, with USD/CNY crossing above CNY 6.80 for the first time since July 2017. The yuan crosses then witnessed sharp 200 pip pullbacks, with subsequent chatter of the large Chinese state owned banks selling USD/CNY around CNY6.81. - The JPY crosses sold off on the broader risk off flows surrounding the the move in the yuan, but the JPY's upside was limited by some key support levels across the USD/JPY, AUD/JPY & EUR/JPY crosses. - The USD advanced against all but the JPY over amid the risk off flows, before paring its gains as the yuan trimmed its losses, with the DXY trading a touch softer last. - AUD has been the marginal underperformer on the session.

Technical Analysis


BUND: (U18) Bears Need Close Below 162.26

*RES 4: 164.52 Low Sept 1 now resistance
*RES 3: 164.33 Weekly Bear channel top off 2016 high
*RES 2: 164.19 2018 High May 29
*RES 1: 163.26 High July 19

*PREVIOUS CLOSE: 163.14

*SUP 1: 162.70 Low July 19
*SUP 2: 162.57 21-DMA
*SUP 3: 162.40 Low July 11
*SUP 4: 162.26 Low July 10    

*COMMENTARY: The break of 163.22 has lacked follow through although bullish focus has now shifted to the 164.19-52 region where the weekly bear channel top off 2016 highs is situated. Very narrowed Bollinger bands increase the risk of a break out in coming sessions. The 21-DMA is noted at 162.57 but bears look for a close below 162.26 to confirm a break of the 21-DMA and shift initial focus to 161.26-75. Bulls now need a close above 163.26 to add support to their case.

EUROSTOXX50: Bulls Need Close Above 200-DMA

*RES 4: 3540.64 High June 15
*RES 3: 3509.66 200-DMA
*RES 2: 3502.44 55-WMA
*RES 1: 3487.00 High July 18

*PREVIOUS CLOSE: 3471.64

*SUP 1: 3466.26 High July 13 now support
*SUP 2: 3425.75 21-DMA
*SUP 3: 3418.06 Low July 12
*SUP 4: 3389.44 Alternating daily support/resistance

*COMMENTARY: Time spent above the 55-DMA (3476.93) has been brief so far with pressure on initial support. Bears still need a close below 3466.26 to ease renewed bullish pressure and below 3418.06 to confirm a break of the 21-DMA and shift initial focus back to 3340.50 June lows. Bulls continue to look for a close above the 200-DMA to confirm focus on 3540.03-3566.53 where the bear channel top (3549.11) off 2018 highs is located.

Eurex Futures Market Close


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This article is from Eurex Exchange and is being posted with Eurex Exchange’s permission. The views expressed in this article are solely those of the author and/or Eurex Exchange and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


19207




Futures

FX Rundown


Overnight strength in the Dollar dissipated as the morning unfolded. President Trump said he’s “not thrilled” about the Fed’s path of interest rate hikes and this sent the Dollar briefly into the red on the session. What are the levels for the Dollar, Euro, Yen, Aussie and Canadian and how are we playing them?

 

Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.

Visit our website at www.bluelinefutures.com to open an account and stay up to date with our research.

Bill Baruch is President and founder of Blue Line Futures. Bill has more than a decade of trading experience. Working with clients he focuses on developing trading strategies that present a clear objective for both long and short-term trading approaches. He believes that in order to properly execute a trading strategy, there must be a well-balanced approach to risk and reward.

Prior to Blue Line, Bill was the Chief Market Strategist at iiTRADER which followed running a trade desk at Lind Waldock and MF Global.

Bill is a featured expert on CNBC, Bloomberg and the Wall Street Journal as well as other top tier publications. 

Blue Line Futures is a leading futures and commodities brokerage firm located at the Chicago Board of Trade. We work with clients that range from institutional to professional to novice and from self-directed to broker-assisted. No matter what type of trader you are, our mission is simple; to put the client first. This means bringing YOU strong customer service, consistent and reliable research and state of the art technology. 

This video is from Blue Line Futures and is being posted with iBlue Line Futures’ permission. The views expressed in this video are solely those of the author and/or Blue Line Futures and IB is not endorsing or recommending any investment or trading discussed in the article. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 

 

 


19206




Macro

BlackRock - The Bumpy Ride to Brexit


Richard explains why investors in UK assets should expect a bumpy ride as UK-EU Brexit negotiations unfold.

The UK’s new Brexit white paper should allow negotiations over the terms of its future relationship with the European Union (EU) to move forward. Yet we could see UK-EU relations deteriorating before improving. Investors in UK assets should expect a bumpy ride.

                                       

Our BlackRock Growth GPS for the UK shows growth expectations have only modestly recovered from the heavy blow the Brexit vote dealt to the UK economy. See the blue line above. Meanwhile, our UK Inflation GPS (green line) shows inflation ticking lower but remaining much higher than before the Brexit vote, mostly due to a weaker British pound pushing up import prices. UK growth has been significantly lagging the rest of the G7, but may have recovered enough to allow the Bank of England to raise rates in August, we believe. Subdued growth combined with elevated inflation is typically a challenging backdrop for risk assets. UK stocks have been resilient recently, aided by domestic stocks’ global orientation and an M&A uptick. Yet political uncertainty looks set to stay elevated in the second half.

Our Brexit base case

The UK’s Brexit proposal would see the country effectively retaining full access to the EU single market for goods but losing access for services. It is closer to a “soft Brexit” than many had anticipated, angering some in the pro-Brexit camp. The proposal reflects the UK government’s gradual realization that any alternative would be highly disruptive for the manufacturing sector and would leave issues surrounding its land border with EU member Ireland unresolved. The UK has shifted its stance on previously non-negotiable issues, such as accepting alignment with European regulations and judicial rulings. This allows talks to move forward for now. Yet there’s a major unresolved problem: The EU has stated that “cherry-picking” EU-membership principles to abide by would be unacceptable.

We see Brexit noise getting louder as the March 2019 date for the UK’s exit nears. The EU will need to decide if it’s willing to accept a tailored agreement. The alternative is forcing the UK to choose between a limited free-trade deal or full adherence to the EU’s four freedoms, including free movement of people, at the risk of a negotiation breakdown. Our base case: Pressure to avoid a no-deal outcome leads to a compromise later this year. We expect an extended transition period starting in March 2019, with key future-relationship decisions kicked down the road. We see nearer-term wildcards too, such as a possible leadership contest in the UK’s ruling Conservative Party.

Key to weathering the Brexit noise

Greater resiliency in portfolios is key amid Brexit volatility and other risks (see our midyear outlook). We are underweight UK equities, and favor overseas earners that can benefit from faster-growing economies and currency weakness. We would avoid UK banks, which tend to be sensitive to Brexit news. We prefer U.S. and emerging market (EM) equities on higher earnings growth. We do not expect UK government bond yields to rise materially amid political uncertainty. We see UK real estate fundamentals staying strong, but focus on the highest-quality assets. We expect the pound to be volatile, with potential downward pressure until a Brexit resolution nears.

---

Richard Turnill is BlackRock’s global chief investment strategist. He is a regular contributor to The Blog

Investing involves risks, including possible loss of principal.

This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. The opinions expressed are as of July 2018 and may change as subsequent conditions vary. The information and opinions contained in this post are derived from proprietary and nonproprietary sources deemed by BlackRock to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by BlackRock, its officers, employees or agents. This post may contain “forward-looking” information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Reliance upon information in this post is at the sole discretion of the reader. Past performance is no guarantee of future results. Index performance is shown for illustrative purposes only. You cannot invest directly in an index.

©2018 BlackRock, Inc. All rights reserved. BLACKROCK is a registered trademark of BlackRock, Inc., or its subsidiaries in the United States and elsewhere. All other marks are the property of their respective owners.

547661

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This material is from BlackRock and is being posted with BlackRock’s permission. The views expressed in this material are solely those of the author and/or BlackRock and IB is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice. 


19202




1 2 3 4 5 2 1321

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