Press review - page 471

[Sergey Golubev]

Intra-Day Fundamentals - EUR/USD, GBP/USD and S&P 500: Non-Farm Employment Change

2017-01-06 13:30 GMT | [USD - Non-Farm Employment Change]

• past data is 178K
• forecast data is 175K
• actual data is 156K according to the latest press release

if actual > forecast (or previous one) = good for currency (for USD in our case)

[USD - Non-Farm Employment Change] = Change in the number of employed people during the previous month, excluding the farming industry.

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From the official report:

"Total nonfarm payroll employment rose by 156,000 in December, and the unemployment rate was little changed at 4.7 percent, the U.S. Bureau of Labor Statistics reported today. Job growth occurred in health care and social assistance."

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EUR/USD M5: 75 pips range price movement by Non-Farm Payrolls news events

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GBP/USD M5: 37 pips range price movement by Non-Farm Payrolls news events

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S&P 500: pips range price movement by Non-Farm Payrolls news events

[Sergey Golubev]

CAC 40 - daily ranging within narrow 4,929/4,860 levels (based on the article)

• "CAC 40 consolidation has continued for the week, after putting in a new high on Tuesday at 4,929.60. So far for Friday’s session, the Index is trading down modestly (-0.17%) for today’s session. Top winners for the CAC 40 include Nokia (+1.68%) and Kering (+1.36%). Losers for the day include Sanofi (-2.71%) and Technip (-1.08)."
• "Technically, the CAC 40 can be seen consolidating on the daily chart below. This 4-day range has been established by prices failing to breakout higher, which would signal a continuation of the Index’s multi month uptrend. Going into next week’s trading, traders should continue to look for a breakout above Tuesdays high. Alternatively, in the event that prices break under today’s low of 4,874.40, it may suggest that a new swing high has been put in place. In this scenario, traders may begin to look for the CAC 40 to retrace a portion of its December 2016 gains."
• "If prices are rejected near present values, it may suggest that the Index may then retrace back towards values of support. For today’s trading, this includes the S3 pivot at 4,892.10 and the S4 pivot found at 4,883.50. Traders should note that prices have already attempted to breakout once below the S4 pivot this morning. In the event of another attempt, bearish traders may look for new lows to be established before today’s end of trading."

[Sergey Golubev]

The New Book By The Math Professor Who Beat Las Vegas & Wall Street (based on the article)

Ed Thorp's new book is "A Man For All Markets: From Las Vegas To Wall Street, How I Beat The Dealer And The Market" (Random House, January, 2017). 

• "His first book, "Beat The Dealer," published when John F. Kennedy was president, revolutionized the game of blackjack by providing a mathematically-derived method to win by playing a basic strategy and counting certain cards."
• "The legendary math professor then moved on in the late 1960s to form Convertible Hedge Associates, later to be called Princeton Newport Partners -- where he became one of the first to apply quantitative thinking to the markets, successfully, and for a long time."
• "The new book looks back at all of his amazing career. I had a chance to ask Professor Thorp a few questions about his latest work and he was kind enough to answer them."

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A Man for All Markets: "A Man For All Markets: From Las Vegas To Wall Street, How I Beat The Dealer And The Market

The incredible true story of the card-counting mathematics professor who taught the world how to beat the dealer and, as the first of the great quantitative investors, ushered in a revolution on Wall Street. 

[Sergey Golubev]

Weekly Outlook: 2017, January 08 - January 15 (based on the article)

The US dollar wobbled in the wake of 2017, torn between good and bad news. US Retail sales, consumer sentiment and PPI stand out. These are the highlights for this week.

The US monthly employment report showed a lower than expected job growth in December but wages registered a 2.9% annualized gain. The economy added 156,000 positions while expected to increase 175,000. The unemployment rate edged to 4.7% from 4.6%. However, wage growth was the most significant factor in December’s report as average hourly wages jumped 10 cents to $26, the highest gain since 2009, indicating the US labor market has fully recovered. The final report of 2016 also comes amidst a presidential transition period. Donald Trump has promised aggressive fiscal measures including tax cuts and higher domestic spending to boost economic growth beyond the mild expansion witnessed so far.

1. US Crude Oil Inventories: Wednesday, 15:30. Oil prices increased as Saudi Arabia consented to OPEC’s plea to reduce output after prices fell on Us data.
2. US Unemployment Claims: Thursday, 13:30. Economists expected a higher reading of 262,000.
3. US Retail sales: Friday, 13:30.
   
4. US PPI: Friday, 13:30.
   
5. US UoM Consumer Sentiment: Friday, 15:00. Economists expected a milder rise to 94.3.

[Sergey Golubev]

Weekly EUR/USD Outlook: 2017, January 08 - January 15 (based on the article)

EUR/USD slipped to new 14-year lows in the wake of 2017 but recovered very quickly thanks to weakness in the USD. The second week of January features trade balance and industrial output measures.

Data in the euro-zone has been relatively positive, with a significant drop in German unemployment and a rise in inflation, especially in Germany. Retail sales missed expectations, but this did not stop the euro. In the US, data had a good start with an excellent report from the manufacturing sector but then became sour with ADP. The meeting minutes from the Fed hurt most, as they showed that Yellen and co. got a bit ahead of themselves with expectations for stimulus from Trump. The last word went to the dollar, with the NFP report: wages are up 2.9%, triggering talk about inflationary pressures.

1. German Industrial Production: Monday, 7:00. A rise of 0.7% is on the cards.
2. German Trade Balance: Monday, 7:00. A similar level of 20.8 billion is estimated for November.
3. Sentix Investor Confidence: Monday, 9:30. A bounce to 12.6 is projected.
4. Unemployment Rate: Monday, 10:00. A repeat of 9.8% is forecast.
5. French Industrial Production: Tuesday, 7:45. An increase of 0.5% is predicted.
6. French Final CPI: Thursday, 7:45. This number will likely be confirmed in this final read.
7. Industrial Production: Thursday, 10:00. A gain of 0.5% is on the cards.
8. ECB Meeting Minutes: Thursday, 12:30. The European Central Bank announced an extension of its QE program through 2017, a removal of some limits on bond buying but also a reduction in the pace of these buys. The bottom line was dovish as seen in the value of EUR/USD The meeting minutes could reveal if the ECB is still very worried about inflation, the reason for extending the program, or actually satisfied with the progress that has been made, the reason for the reduction. It could also tell us something about the next potential moves.

[Sergey Golubev]

Weekly Fundamental Forecast for Dollar Index (based on the article)

Dollar Index - "Top-tier economic data will not enter the picture until late in the week. Retail sales, consumer confidence and PPI figures are all due to cross the wires on Friday, with consensus projections pointing to improvements all around. Such outcomes may offer a lifeline to the greenback much like the jobs report. However, there seems to be ample space for the resumption of profit-taking on long-USD positions before whatever support is to be found on the statistical front emerges."

[Sergey Golubev]

Weekly Fundamental Forecast for GBP/USD (based on the article)

GBP/USD - "Next week presents a single day with a batch of data points for the British Pound, and that’s on Wednesday when we get NIESR GDP, November trade balance figures and industrial production numbers. Any evidence of additional strength may serve to only make those prior forecasts from the BoE look ‘more wrong’ while bringing additional top-side to the British Pound."

[Sergey Golubev]

Weekly Fundamental Forecast for AUD/USD (based on the article)

AUD/USD - "The Australian Dollar’s wildcard this week probably comes from Chinese data, of which there is a little more. Tuesday’s consumer price index and Friday’s trade data could see the Australian Dollar playing its sometime role as the markets’ favorite liquid China proxy."

[Sergey Golubev]

Weekly Fundamental Forecast for USD/CNH (based on the article)

USD/CNH - "On China’s side, the calendar next week is packed with December Consumer Price Index (CPI), monetary supply, New Yuan Loans and trade gauges. The proportion of home loans to New Yuan loans soared once again in November, to 85.5%. The increased risk of price bubbles, especially seen in the housing market, is the key reason that China’s Central Bank tweaked its credit strategy from loosening to tightening and mainly uses open market operations to provide liquidity. A breakdown of the CPI print will also help to show which sectors expanded fast in prices and whether they are reasonable."

[Sergey Golubev]

Weekly Fundamental Forecast for GOLD (XAU/USD) (based on the article)

GOLD (XAU/USD) - "Despite a miss on the headline Non-Farm Payrolls report on Friday, wage growth figures marked the fastest pace of growth since 2009 with print of 2.9% y/y. On the back of this recent update on the labor markets, traders will be lending a keen ear to a fresh batch of central bank commentary with Minneapolis Fed President Neel Kashkari, Fed Governor Jerome Powell, Philadelphia Fed President Patrick Harker, Chicago Fed President Charles Evans and Chair Janet Yellen slated for speeches next week (all 2017 voting members). Highlighting the economic docket next week is the release of the December retail sales figures on Friday with consensus estimates calling for a print of 0.6%, up from a previous read of just 0.1%. A positive development should keep interest rate expectations well-anchored ahead of the next rate decision on February 1 especially as Fed Fund Futures highlight a greater than 60% probability for a June rate-hike."