Category: Financial Markets 2018
The analysis published under this category are as follows.
Tuesday, January 01, 2019
Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate / Stock-Markets / Financial Markets 2018
By: Nadeem_Walayat
Donald Trump and Britain's countdown to BrExit Independence (29th of March 2019) proved to be the weapons of mass financial distraction of 2018 that dominated politics and the financial markets. Both born out of 2016 elections seeking to upset the status quo
of an elite that had taken their electorates for granted for decades that culminated in the failure of politicians to hold the banking crime syndicate to account for the financial crisis which ushered in a decade of economic depression for most of the electorate.
In the UK a Remainer Prime Minister has been determined to subvert the will of the British people with most Westminister politicians encouraging calls for a further chaos inducing Second Referendum that the establishment are certain to engineer to deliver a REMAIN outcome as illustrated by the economic collapse propaganda surging out of the Bank of England downwards.
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Sunday, December 23, 2018
Can The Markets Get Any Worse? / Stock-Markets / Financial Markets 2018
By: Anthony_Cherniawski
Supported by its Cycle Top at 21.96, VIX rallied above its Head & Shoulders neckline at 30.00 on Friday, closing above it. It is entirely possible that it could meet its target in the next week.
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Saturday, December 22, 2018
Markets Reject the Fed? / Stock-Markets / Financial Markets 2018
By: The_Gold_Report
On Wednesday, the Fed raised the Fed Funds rate by a quarter point as expected. The FOMC statement was suitably "dovish" by reducing the consensus forward guidance on future rate hikes from three to two. The Fed also signalled that its Quantitative Tightening program would continue on "autopilot" as planned. The response was not what the Fed expected. Stocks fell hard and bonds soared.
Financial markets are about to revisit some important questions.
First, does QE actually work? Does it boost the real economy or does it simply drive up valuations by encouraging speculation? We think the weakest economic recovery in two generations provides the answer.
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Friday, December 21, 2018
Trump-Defying Fed Enters Danger Zone for Economy and Markets / Stock-Markets / Financial Markets 2018
By: MoneyMetals
The Fed blinked – but didn’t flinch away from another rate hike. On Wednesday, Federal Open Market Committee (FOMC) policymakers rejected President Donald Trump’s call for a pause. They raised their benchmark rate by a quarter point to a range up to 2.5%.
The only concession Fed chairman Jerome Powell offered to Trump and nervous stock market investors was a revised, less hawkish outlook for 2019. Powell and company now indicate they intend to hike just twice next year.
Tuesday, December 18, 2018
The Coming Financial Storm / Stock-Markets / Financial Markets 2018
By: FXCOT
The Dow Jones Industrial Average slumped more than 500 points Monday as investors looked ahead to this week’s Federal Reserve meeting amid mounting signs of slowing economic growth around the world. Major indexes opened modestly lower and began a steady descent around midday. All 30 stocks in the Dow industrials and all 11 sectors in the S&P 500 ended lower. The declines pulled the technology-heavy Nasdaq Composite into the red for the year, while the Russell 2000 index of small-capitalization stocks slumped into a bear market--a decline of more than 20% from its Aug. 31 high. And U.S. crude settled below $50 a barrel for the first time in 14 months.
Sunday, December 16, 2018
Is there a Lump of Coal in Santa's Stock Market Bag? / Stock-Markets / Financial Markets 2018
By: Anthony_Cherniawski
VIX eased down to challenge the weekly short-term support at 20.48 on Thursday. On Friday it bounced to close above its Cycle Top support/resistance at 21.25. Wall Street doesn’t seem to be alarmed.
(Bloomberg) Wall Street is making peace with the new normal of higher volatility as stocks careen between agonizing sell-offs and sudden rallies.
After the gut-wrenching $2.5 trillion wipeout in the S&P 500 since early October, traders are resting at relative ease as they prep for market bumps down the road.
Wednesday, December 12, 2018
Gold & Global Financial Crisis Redux / Stock-Markets / Financial Markets 2018
By: Jim_Willie_CB
The Global Financial Crisis, a broader deeper more powerful systemic crisis than the Lehman Event was, has finally arrived in a great redux. It is seen in numerous areas. We have finally arrived at the ten-year anniversary of the Lehman event, a killjob whereby JPMorgan and Goldman Sachs bought a few $billion in mortgage bonds and never paid Lehman Brothers. The firm died, called a financial failure, but was actually a strangulation. Goldman went on to capture AIG, in order to claim 100 cents per dollar on insured mortgage bonds, a second crime. The Wall Street banks, under the leader Henry Paulsen as the managing USTreasury Secretary, completed the third crime, by pitching the $700 billion TARP Fund. They stole it, using the fund for enriching themselves with redeemed preferred stock, instead of making the funds available for lending purposes. Here ten years later, nothing has been fixed. In fact, all the abuses heaped upon the mortgage finance sector have been repeated in sovereign bonds. The USTreasury Bond has become a subprime bond, financed by pure monetization, almost no actual bonds buyers, $trillion annual deficits, auctions rigged, with hidden demand from the derivative machinery. It qualifies as a Third World debt security. The corporate bonds were routinely abused in stock buybacks, hardly ever ploughed back into the business. High yield bonds are the norm now, along with the wrecked Emerging Market bonds. There are many analysts who call the current situation the Everything Bond Bubble.
Monday, December 03, 2018
Weekly Charts and Update on Equity Markets, FX Trades and Commodities / Stock-Markets / Financial Markets 2018
By: FXCOT
Japan’s Nikkei 225, China’s Shanghai Composite and South Korea’s Kospi stock indexes gained 2.2%, 2% and 1.6%, respectively. The Chinese yuan rose 0.36% to about 6.925 per U.S. dollar. Ahead of the U.S. open, S&P 500 futures also climbed 1.5%. President Trump and Chinese President Xi Jinping approved the deal on Saturday in Buenos Aires. It offers Beijing a reprieve from a planned increase in tariffs, scheduled for Jan. 1, on $200 billion in Chinese goods exports to the U.S. Tariffs were scheduled to rise to 25% from 10%.
We have been long equity markets in Novemeber from 2640 here: Be long S&P Since our trade, the equity markets have rallied over +4% in Novemeber.
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Sunday, December 02, 2018
A Post-Powell View of USD, S&P 500 and Gold / Stock-Markets / Financial Markets 2018
By: Gary_Tanashian
The Fed blinked. This was not news to Macro Tourist Kevin Muir or readers of Biiwii.com, which is very pleased to publish his work.
Amid a weakening global economy, gathering signs of weakening in the US economy and a dump in inflation expectations, Jerome Powell implied that the Fed may be going on hold for a while after a December rate hike.
This graph from SG Cross Asset Research/Equity Quant by way of Kevin Muir’s article attempts to show that the accumulated rate hike tightening and “shadow” tightening as a result of QE suspension has now met or exceeded the levels that preceded the last two economic recessions.
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Wednesday, November 28, 2018
Watch This Picture As Asset Prices Fall / Stock-Markets / Financial Markets 2018
By: F_F_Wiley
“It is high time we rediscovered the role of the financial cycle in macroeconomics.” —Claudio Borio, Bank for International Settlements
In May, we queued up the b-side of a record describing America’s balance sheet—we looked at the mix of lenders instead of the usual “a-side” analysis of the borrowers.
We showed that the balance sheet includes four types of lenders—banks, the Fed, foreigners and prior domestic saving—as in the updated chart below. And the “prior domestic saving” category, since you asked, is mostly households, pension funds and insurance companies investing in bonds and bond funds.
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Monday, November 26, 2018
Trading Charts and Setups: Chances of a FED Interest Rate Hike Falling / Stock-Markets / Financial Markets 2018
By: FXCOT
As equity markets make a topping formation and US 10 year yield retest 3% level, the chances of a FED hike in 2019 is declining. Govt pressure will build up on Powell into 2019 and we believe this will damage FED ability to freely raise rates even if they wish to. We highlight a few key charts and setups to watch out for as you start a new trading week.
2018 has been a difficult years for every single asset class. The mutual fund industry is bleeding and hedge fund managers are struggling to stay afloat. Traditional investment models do not work any more. This is a year in which both bonds and stocks fell together. Traditional models work on shifting money from one asset class to another. However this year, all classes bled. This year, set apart the genius managers from the ordinary. Fxcot trading system which is primarily a EURUSD, USDJPY trading system has made over 90% this year which is truly incredible given the performance of hedge funds.
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Monday, November 26, 2018
Stock Market Approach Neckline / Stock-Markets / Financial Markets 2018
By: Anthony_Cherniawski
VIX advanced during the short holiday week, making a new high and higher low, closing above its weekly Cycle Top at 20.63. Note the Head & Shoulders formation which may give it more impetus in the next week. VIX is also positioned for a triply-indicated surge of strength through mid-December.
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Thursday, November 22, 2018
Return of Stock, Oil and Forex Markets Volatility / Stock-Markets / Financial Markets 2018
By: FXCOT
Market volatility is back. Forex markets have seen whipsaws as the dollar index tries to price in a weakening US economy and a FED which is raising rates. Stocks have suffered a series of pullbacks this fall that have chipped away at much of their 2018 gains. Downbeat forecasts from former market leaders such as Apple Inc. and Facebook Inc. have raised questions over whether the past year’s gains can be justified. Adding to those worries, investors are already expecting a broader slowdown in corporate earnings growth as rising rates and a stronger dollar take a greater toll on profits.
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Monday, November 12, 2018
3 Triggers That Could Push This Sell-Off into a Financial Crisis / Stock-Markets / Financial Markets 2018
By: John_Mauldin
There’s very real possibility the global economy breaks down in the next six months.Anything could trigger a crisis, and it could well be something no one now foresees. But here are my three candidates.
Corporate Credit Crisis
US companies are way more leveraged now than they were ahead of the 2008 crisis.
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Tuesday, November 06, 2018
Financial Markets Are Making Faulty Assumptions about Growth & Resources / Stock-Markets / Financial Markets 2018
By: MoneyMetals
Mike Gleason: It is my privilege now to welcome in Dr. Chris Martenson of PeakProsperity.com, and author of the book Prosper! How to Prepare for the Future and Create a World Worth Inheriting. Chris is a commentator on a range of important topics such as global economics, financial markets, governmental policy, precious metals and the importance of preparedness among other things. And it's always great to have him with us.
Chris, it's been too long, but welcome back and thanks for joining us again.
Chris Martenson: Hey Mike. Thank you so much. It's great to be back with you.
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Sunday, October 21, 2018
SPX/Gold, 30yr Yields & Yield Curve – Amigos 1, 2 & 3 Updated / Stock-Markets / Financial Markets 2018
By: Gary_Tanashian
We began the Amigos theme last year in order to be guided by the goofy riders during the ending stages of a cyclical, risk-on phase that was not going to end until the proper macro signals come about, no matter how many times the bears declared victory along the way. The fact that grown adults see conspiracies around every corner (okay, I see them around every third corner myself, but work with me here) makes such macro signaling very necessary in order to keep bias at bay.
To review…
- Amigo #1 is the SPX/Gold Ratio (more generally, stocks vs. gold) and a counter cyclical and risk ‘off’ environment simply will not engage until stocks top out vs. gold, if even for a cyclical down phase within the up phase.
- Amigo #2 is the 30yr Treasury Yield and it’s 100 month EMA ‘limiter’, which has supported the funding mechanism (unrestrained credit creation) for the leveraged economy for decades. If the limiter holds yet again, while there could be some deflationary problems the system will persist. If it breaks for the first time in decades well, we are not in Kansas anymore and the door would open up to an inflationary Crack Up Boom (von Mises style).
- Amigo #3 is the Yield Curve, which is in the late stages of flattening. When it turns up it will either be under pains of deflationary or inflationary pressure. Note the word “pains” because there would be pain, either way; but in different financial and economic areas.
Thursday, October 18, 2018
Investor Alert: Is the Trump Agenda in Peril? / Stock-Markets / Financial Markets 2018
By: MoneyMetals
Is the Trump agenda in peril? It’s a question investors should consider ahead of the mid-term elections.
Up to now, the Trump economic agenda has certainly been great for Wall Street and much of the broader economy. The Dow Jones Industrials continues to defy all naysayers – notching yet another new record high in the first week of October before correcting.
Meanwhile, the latest GDP numbers show the economy growing at its fastest pace in over a decade, with official unemployment at generational lows.
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Wednesday, October 17, 2018
Stock Market Volatility Breeds Contempt / Stock-Markets / Financial Markets 2018
By: The_Gold_Report
Precious metals expert Michael Ballanger discusses the stock market volatility of the last week and what it may mean for precious metals.
When asked about the dominant theme for the markets last January, I said that the one thing I looked forward to was a return of "VOLATILITY" as the Federal Reserve Board moved to "normalize" the interest rate structure, now commonly referred to as quantitative tightening. What has actually transpired since then was a brief volatility spike in February during which the UVXY tripled in ten days but other than that, markets screamed higher, hitting new high after new high with annoying complacency and irritating certainty while "VOL" collapsed.
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Tuesday, October 16, 2018
BREXIT, Italy’s Deficit, The EU Summit And Fomcs Minutes In Focus / Stock-Markets / Financial Markets 2018
By: C_Pissouros
Darius Anucauskas writes: It looks like a busy week, as there is a lot of economic data that is ready to hit the spotlight, together with the political news that are taking centre stage. Brexit negotiations are also in focus, together with the ongoing discussions around Italy’s deficit.
On Monday, the calendar is relatively quiet, apart from US retail sales figures that are set to come out before the US opening bell. The expectations here are that the figures for the core and headline could have increased. The headline number is expected to come out at +0.7%, which is well above the previous +0.1%. The core figure, which excludes automobiles, is forecasted to come out one tenth of percent higher, at +0.4%, against the previous month’s +0.3%. Certainly, better sales figures could have a positive effect on the US dollar, but we doubt that the greenback will show any strong reaction after numbers come out.
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Tuesday, October 09, 2018
Interest Rate Shock-Time to Find Out Who has been Swimming Naked / Stock-Markets / Financial Markets 2018
By: Plunger
What Happened?
Could everything have changed in a 24 hour period? Apparently, Yes, Over the span of 24 hours markets woke up and realized that the FED may be at the cusp of committing Policy Error. Recently bonds have been teetering on the edge and this week Jerome Powell gave bonds a push off the ledge. Bonds delivered a message and the stock market was listening. Stocks got derailed along with bonds.
Yields blew out and sucked the air out of the stock market. So why the big move in bonds? Two reasons:
- Less demand for LT bonds due to the higher cost of hedging caused by higher yields, higher USD and emerging markets dropping.
- FED Chair Powell advertising he plans on being very aggressive with rates. He plans on raising rates until something breaks.