Morning Report: Comments, Positions, News, & Charts

Please click here to view the PDF version

Morning Report: Comments, Positions, News, & Charts

24 July 2014/8:50 a.m. ET

Quick View

Market Comments

Lots of news in the market today, starting with a much more dovish than expected summary of views going forward by the Reserve Bank of New Zealand.  Even though the bank hiked its Official Cash Rate (OCR) by 25 basis points to 3.5 percent, the New Zealand dollar plunged on the expectation the bank is now on hold.  Plus, the bank made it explicitly clear its currency is too high.  It is on the radar screen now for a long-term trade.  Let’s watch any corrective reaction…

NZD/USD Daily: Top may be in place…I had a final extension target to 0.8914; the pair rally high was 0.8835…

Eurozone PMI numbers a bit better than expected…the euro has reacted positively so far this morning…

July 24 (Reuters) - The euro zone's private sector expanded at the fastest rate in three months in July, although faster growth in new business was driven mainly by companies cutting prices again, surveys showed on Thursday.

Markit's Composite Purchasing Managers' Index (PMI), based on surveys of thousands of companies across the region and a good early indicator of overall growth, rose to 54.0 in July from 52.8, its highest since April. Any number above 50 indicates expansion.

…maybe getting that bounce we’ve been looking for….EUR/USD Hourly: A rally back to 1.3537 would be a good place to re-sell; first resistance near 1.3500….

GBP/USD not reacting well to this news this morning…UK retail sales for June disappointed, rising just 0.1 percent…the pound is working lower….working off a view that this is simply an A-B-C projection, the more conservative view, this leg targets down to 1.6939 as you can see below.  But as indicated in yesterday’s update, the pound has nice cascade potential…

We possibly have a nice setup developing for an opportunity to get short USD/JPY again.  There is a confluence technical target at 101.83-91…which it could test this morning…watching.

Positions

 Economic Calendar (Dukascopy) & Key Events & News:

 Market Briefs (IFR Markets)

• EUR/USD swiftly off a new 1.3438 trend low
• NZD/USD 8690 to 8568 post RBNZ hike
• AUD/NZD 1.0856 to 1.1014 post RBNZ/China PMI
• Not one way traffic but gen risk tone remains cautiously positive
• S&P500 futures hit record high ahead of today’s earnings-fest
• DE Govt EU could move to Russia sanctions by end–Jul  
• EU to weigh far reaching sanctions on Russia FT
• SNB’s Jordan, cap on CHF remains central policy tool Rts
• UK Jun R.Sales 3.6% y/y vs 3.9% prev, 3.9% exp
• DE Jul Flash Mfg PMI 52.9 vs 52.0 prev, 52.0 exp
• DE Jul Flash Serv PMI 56.6 vs 54.6 prev, 54.5 exp
• EZ Jul Flash Mfg PMI 51.9 vs 51.8 prev, 51.7 exp
• EZ Jul Fla\sh Serv PMI 54.4 vs 52.8 prev, 52.8 exp
• RBNZ hikes OCR 25 bps to 3.5%, signals pause, as eyed
• NZ Jun trade Bal. NZ$247 mln, yr-to-date NZ$1.2 bln surplus
• China Ind Ministry  Econ facing downward pressures Rts
China July HSBC flash mfg PMI 52, 18m high, Jun 50.7

Chart View Matrix

 Chart of the Day

No surprise why there are concerns in the EU about Russian sactons among some members…

Black Swan Capital www.blackswantrading.com

Comment