Examining current flows and market direction in FX, Commodities and Indices.
Indices
U.S. tax cuts are underway and while it will only have limited effect on growth and USD. There will be a great boost to U.S equities, especially small to medium sized companies and financials. Main beneficiary will be Russell2000 ,Dow Jones industrial and S&P 500. The final bill is not ready to be signed yet, and while the road is bumpy market is eyeing end of the year to get the bill signed. Market is currently only pricing in %50 of a tax cut and once a bill is passed there is much more room for Indices to run higher. Pre positioning at this stage is very lucrative. Levels to eye for a long entry on Dow are 2422 and 2365. Updates to follow on other Indices. Risk to the trade is if the tax bill fails, we expect the S&P 500 to fall by as much as 10 percent.
Gold
Physical gold demand this side of the year is scarce. Gold is purely swinging on risk sentiment. The next big risk event is 8th of December debt ceiling. Should U.S. gov. fail to lift the ceiling a partial government shutdown will follow and a spike higher in gold. However this scenario is very unlikely and we expect gold bulls to give way which could see Gold trade at $1263 and $1245 in the coming weeks.
Usd
NFP this week will be a test for the health of the U.S economy. Expecting a better print, eyeing wage growth. Adding to USD positive sentiment is the possibility of more rate hikes for 2018 and a case for a year end rally, as tax cuts will put pressure on the FED to accelerate hiking. This is our base case, monitoring price at the moment and standing ready to take advantage should this idea unfold. Eyeing USDJPY long, XAUUSD short.
CAD
After a surprise labor data and monster reaction from traders it is very clear that speculators are pricing in a hike for January 2018(%60 hike priced in). The next BOC meeting this week is likely to buy time and make rate hikes data dependent but is unlikely to stop traders amassing long $CAD. Eyeing PA on USDCAD and EURCAD to go short and CADJPY to go long with a liquidation date in Jan 2018.
This report, live trade management coupled with daily insights and psychology support are part of the 3 month course . Where members engage on a daily basis and break free from the guessing game and concentrate on corners of the market where investors and speculators are moving money. It allows for a much more relaxed and structured trading and enhances performance.
Good Luck To Us All
Miad Kasravi
Speculators Trading