Category: Financial Markets Update

FOR THURSDAY: (7/28) Slightly hawkish statement led to typically illogical unraveling. Trade now waiting on the Bank of Japan on Friday and the daily rumors and retractions there are creating huge moves over there. China also unraveled badly last night and that isn’t a good sign. Failure of the S & P to make new highs on the day also isn’t a great sign. Facebook reported results which simply crushed expectations. The street was expecting $6.01 billion in revenue and EPS of $0.82. Instead it got $6.44 billion – 84% of which came from mobile – and EPS of $0.97 cents. That result is being a little helpful in the after-market.

FOR WEDNESDAY: (7/27) S & P up overnight as they are buying APPLE. FOMC days are often filled with surprises, and some cycles suggest as much for Wednesday. Given recent Fed Governor testimony, it’s hard to imagine anything hawkish. We do have Bank of Japan on Friday and another surprise and volatile cycle looming there. We’ll try to play the head fakes and counter-reactions after the announcement but sometimes it’s hard to get your orders in and beat those computer buy programs.

FOR TUESDAY: (7/26) Markets are usually pretty dull before FOMC but they do often run up the S & P early and we’re probably open to buying on Tuesday for such an event. Crude should continue lower into the end of the week and that gold and silver may bottom by Wednesday.

FOR MONDAY: (7/25) Mondays in the summer have been doggy and we’re moving toward FOMC on Wednesday. Still, stocks often fall the Monday before FOMC and then are a buy going into a probable dovish announcement. Cycles for Wednesday suggest a surprise announcement, which at this point might be more hawkish than expected but we’ll continue to play patterns and cycles this week, with gold pointing lower into Wednesday and stocks mostly higher next week and the dollar choppy but ultimately higher and crude lower next week.

FOR FRIDAY: (7/22) Fridays in the summer have been doggy with long holiday weekends and that often spills into Monday, making the dog days of summer. Pre-FOMC congestion will also now start before next Wednesday’s meeting and they will create muted ranges. Temperatures are running high across the US with a heat dome and let’s hope that doesn’t spillover into more violence.

FOR THURSDAY: (7/21) Trade waiting on Thursday’s ECB and it can cause volatile spikes all over the place on Thursday. It seems that funds are positioning for ECB already, which means that we will get buy and sell the fact reactions probably on Thursday.

We’re going to stay positioned but ideally may take profits on the Euro before the announcement.

FOR WEDNESDAY: (7/20) Trade waiting on Thursday’s ECB and it can cause volatile spikes all over the place then but may be very quiet again on Wednesday.

We’re going to stay positioned but ideally may take profits on the Euro before the announcement.

FOR TUESDAY: (7/19) Failed Turkey coup rebound was easy to predict but summer trading was so muted not sure we learned much. Usually by Tuesdays the trade is back from long holidays and ready to re-position so let’s see if volume picks up and confirms weaker metals this week and weaker crude over the next week and hoping for a secondary low on stocks to buy.

FOR MONDAY: (7/18) Cycles are a bit more optimistic for Monday for a bounce for stocks but still think some downward congestive action could dominate for a few days.

With the background noise changing with French terrorism, we can give the dollar a better chance to reach higher but we still want to sell gold on Monday if we can. Crude still looks under pressure next week.

FOR FRIDAY: (7/15) A serious truck bomb in France could change action for Friday and we have to scramble out of short gold and long stocks until we are sure how markets react.  This week has been too news driven with too many surprises for holding any trade very long and we will continue to stay on top of it as best we can.

Our heart goes out to that country again at this very troubled time.