Tag: finance

In what may be the most material development of the day, moments ago GOP Representative Justin Amash (R-Mich.) said the report that President Trump pressured ousted FBI Director James Comey to end an investigation would merit impeachment if true, becoming the first Republican lawmaker to break from the party and hint at impeachment.

Amash tells reporters that if Comey memo allegations are true, it’s grounds for impeachment. Says he trusts Comey more than Trump.

— Katie Bo Williams (@KatieBoWill) May 17, 2017

Subseqeuentlly, when asked by The Hill if the details in the memo would merit impeachment if they’re true, Amash reiterated “Yes…. But everybody gets a fair trial in this country,” Amash added as he left a House GOP conference meeting.

When asked by another reporter whether he trusted Comey’s word or Trump’s, Amash said: “I think it’s pretty clear I have more confidence in Director Comey.”

According to the Hill, Amash has been one of only two House Republicans to cosponsor a Democratic bill to establish an independent commission to investigate Russia’s role in the election. Rep. Walter Jones (R-N.C.) has also endorsed the legislation.  

Amash is a frequent conservative critic of the Trump administration, and in the past has broken with the White House on a variety of issues, including healthcare reform, NSA surveillance and the Justice Department’s new tougher sentencing guidelines.

And now all eyes on John McCain who many speculated would be the most vocal Republican opponents of Trump, and the first GOPer to recommend impeachment of his old nemesis.

Following the report, the USD tumbled to fresh intraday lows.

via http://ift.tt/2qwitXT Tyler Durden

After last night's surprise API-reported crude build, oil prices dipped and ripped on a tumbling dollar heading into this morning's DOE data and then jumped higher as DOE negated API's build by reporting a 1.75mm draw (less than the expected 2.67mm though). This is the 6th weekly crude draw in a row. Gasoline and Distillates also saw draws. After 14 weeks of production rises, US crude output dropped last week.

 

API

• Crude +882k (-2.67mm exp)
• Cushing -539k
• Gasoline -1.7mm (-1mm exp)
• Distillates +1.787mm

DOE

• Crude -1.75mm (-2.67mm exp)
• Cushing +35k
• Gasoline  -413k (-1mm exp)
• Distillates -1.94mm (-1.45mm exp)

Unlike API, DOE repored a crude draw – the 6th weekly draw in a row…though we note this draw was less than expectations (as was the Gasoline draw)

Interestingly, Bloomberg's Bert Gilbert notes a very large jump in other oils stockpiles this week, drives total stocks higher. This is the biggest week on week increase in other oils stocks since 2010.

After 14 weeks of production rises, US crude output dropped last week.

So where are Saudi Arabia's crude production cuts? Bloomberg's Javier Blas notes-  Don't look for them in U.S. oil import data.

According to the EIA, Saudi crude shipments surged last week to 1.376 million barrels a day, the HIGHEST weekly reading in ten weeks and up 406,000 barrels a day from the previous week. Saudi Arabia is shipping to the U.S. Currently more oil it did between September and December last year. Very odd.

One country that's certainly cutting supplies to the U.S.: Kuwait. The Gulf emirate shipped exactly ZERO barrels last week to U.S. refiners, only the third time it hasn't supplied a single barrel over a week since 2012. The previous weeks occurred in March 2016 and October 2015.

WTI/RBOB dropped on the APi print but the collapse in the dollar has sparked buying into the DOE print. Notably energy was offered into the print but once the data hit spiked higher…

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Elliot Wave Charts

submitted by Soren K Group and Marketslant.com

We admit being big fans of Elliot Wave. We must also admit its subjectivity is difficult for us to manage. But here is a person who manages their own subjectivity and keeps the info dry and honest. Therefore we are  followers of Enda and recommend her work for anyone seeking to use while learning the rules of this difficult but excellent probabilistic  market engine handicapper. 

Enda covers many markets. We chose to lead with her Gold content. We hope you read all of it as we do. Also note the USD analysis. Given recent events, this may be quite prescient.

 

GOLD

Authored by Enda Glynn and Bullwaves.org

30 min

4 Hours

Daily

My Bias: Long towards 1550
Wave Structure: ZigZag correction to the upside.
Long term wave count: Topping in wave (B) at 1550
Important risk events: USD: Crude Oil Inventories.

The short term count in GOLD has been something of a mystery to me over the last few days.
The market is rising as expected off last weeks lows.

BUT!
The price action has not yet turned impulsive as thought.
So there is still an air of concern in the short term.

That being said, I have labelled the structure as a leading diagonal in wave ‘i’ brown.
The proof of this wave count lies in the action off the highs in wave ‘i’.
If we get a clear three wave movement which forms a higher low above 1214.24
Then we will have an Elliot wave buy signal in place.
Every other aspect of my analysis points to a low at current levels
And the extreme in negative sentiment on display at the moment is in itself a sure sign that the price is about to rally.
As always,
The signs are in place, all we need now is the rally itself!

Daily-Elliott-wave-analysis-05-16-17 EURUSD trigger alternate count – outlook unchanged.

EURUSD

30 min

4 Hours

Daily

My Bias: short in wave 3 blue.
Wave Structure: downward impulse wave 1, 2 blue
Long term wave count: lower in wave 3 blue
Important risk events: EUR: Final CPI y/y. USD: Crude Oil Inventories.

Evening Everyone!

What a day for EURUSD, I mentioned in last nights analysis the possibility of another push higher to complete the alternate count.
Todays rally and break of 1.1021, confirms the alternate view which was simply a variation on the same theme.
This market is now extended in a very complex correction higher.
Correction being the operative word, this rally will be completely retraced,
and sooner rather than later according to this wave count.

You will notice on the chart that wave ‘iv’ pink has extended out to form an expanded flat correction.
Wave ‘v’ pink can be counted as complete at todays highs.
This market is regestering a very overbought extreme right now,
with the 4hr RSI posting a six month high today at 86.6!
The count in wave ‘2’ blue is complete,
All that is left is the price to turn down again back into the long term trend.
and of course the world and it mother now wants to buy the Euro!
Perfect timing really,
I would advise against that course of action right now!
the focus again turns to an elliott wave signal off the high.

GBPUSD

30 min

4 Hours

Daily

My Bias: short below parity.
Wave Structure:  continuing impulsive structure to the downside in wave (5)
Long term wave count: decline in wave (5) blue, below parity
Important risk events: GBP: Average Earnings Index 3m/y, Unemployment Rate. USD: Crude Oil Inventories.

The price action in Cable threw up another possibility today as an option in wave (iv) brown.
I have labelled a completing contracting triangle with waves ‘a’ through ‘e’ as almost complete.

The low labelled wave ‘c’ pink is the lower limit for wave ‘e’ of the triangle to travel.
As a break of that low at 1.2844 will rule the triangle pattern out.

todays high lies at 1.2929, and a break of that high will confirm that wave (v) brown is underway.
One thing is for sure,
The last three weeks of sideways action is coming to an end soon,
The wave count calls for another rally higher into the 1.30 area to complete the larger wave pattern.
watch for the completion of three waves off the high of wave ‘d’ in pink.

USDJPY

30 min

4 Hours

Daily

My Bias: LONG
Wave Structure: rally in wave [C]
Long term wave count: wave [C] is underway, upside to above 136.00
Important risk events: JPY: Prelim GDP q/q. USD: Crude Oil Inventories.

The break of the invalidation line at 112.95 trigger the alternate wave count in USDJPY.
Todays low was at 112.92!
But in the rules of the wave principle – a break is a break, no matter how little it is.
This market is now correcting at one degree higher than previously thought.

I have updated the wave count to indicate the new interpretation.
You can see that wave (a) and (b) green are likely complete.
And the market is possibly moving in wave (c) green as I write.

The previous fourth wave low of 112.07 is the first target, as I spoke about previously.
The Fibonacci extension predicts 112.38 as the low in wave (c),
So we have an initial target range to work with from here.
For tomorrow wave’a’ brown should complete near the lower line of the trend channel.
And wave ‘b’ brown will carry sideways again.
We are now looking for a three wave pattern to complete wave (c) green and consequently wave [ii] grey.
The next opportunity lies at the lows of wave [ii] grey.

DOW JONES INDUSTRIALS

30 min

4 Hours

Daily

My Bias: market topping process ongoing
Wave Structure: Impulsive 5 wave structure, possibly topping in an all time high.
Long term wave count: Topping in wave (5)
Important risk events: USD: Crude Oil Inventories.

I have altered the short term labeling on the DOW today to show a completed five waves up in wave ‘i’ pink.
The sharp declines this evening is likely the beginning of wave ‘ii’ pink.
20900 seems a likely target for wave ‘ii’ as this is about the 50% retracement of wave ‘i’ pink.

The next rally up in wave ‘iii’ pink is just around the corner
And will likely carry the price into the 21300 area,
where wave ‘iii’ pink will reach 161.8% of wave ‘i’ pink.
For tomorrow I am looking for a low in wave ‘ii’ after a three wave decline off todays high.
The decline has been sharp so far, so it will complete in a similar fashion.

Read more HERE

via http://ift.tt/2qrJsFP Vince Lanci

People Magazine decided to dedicate their cover story this month to their beloved “cool, even-keeled, no-drama Barack Obama.”  And even though it will come as surprise to precisely no one, the story apparently includes the “bombshell” revelation that….wait for it…Obama can’t stand Trump…shocking, we know.

According to two anonymous sources friendly with the Obamas, People Magazine revealed that Obama frequently describes Trump as “nothing but a bullshitter”…

“He’s nothing but a bullsh–ter,” Obama told two friends early last November, describing an election night phone call with Trump, in which the businessman suddenly professed his “respect” and “admiration” for Obama—after years of hectoring.

 

Speaking to PEOPLE for its new cover story on Obama and his wife Michelle adjusting to life outside the White House, the two friends quoted Obama’s blunt assessment of President-elect Trump. And how has Obama’s opinion changed since Trump been in office? “Well,” said one of the sources, “it hasn’t gotten any better.”

…all of which is odd because they seemed so friendly and comfortable in this pic of their first Oval Office meeting.

 

Meanwhile, after hinting that he would lead the opposition movement against Trump, Obama’s friends now say he plans to be “very respectful of the appropriate role of a former president.”  Which we assume can be loosely translated to mean that he’s not interested in playing petty political games when he can focus on making millions of dollars selling 1-hour speeches to Wall Street for $400k a pop.

A third source close to Obama tells PEOPLE: “He’s deeply concerned with what he’s seen. But he’s also optimistic and heartened that citizens aren’t just watching it happen but engaging with neighbors and elected representatives at town halls.”

 

“He’s very respectful of the appropriate role of a former president and that ex-presidents should not be looking over the shoulder of their successors and commenting on every decision,” says Obama’s long-time friend and political strategist David Axelrod, now director of the University of Chicago’s Institute of Politics.

 

“President Obama’s predecessor didn’t do that. Obviously, this now is a unique set of circumstances, but my sense is that he’s going to try and respect that tradition while reserving the right to speak out in given moments when things rise to that level.”

Meanwhile, the always classy Michelle Obama apparently takes humor in telling her pals that she’s “going all black for the next couple of years” to mourn the Trump presidency. 

via http://ift.tt/2qvTjsA Tyler Durden

With markets having gone from complacent to sheer panic in the span of a day, here is Citi’s FX strategist Todd Elmer, urging traders to take a deep breath with a note which “cuts through the political noise” and as one would expect, says that the “risk-off response across markets to overnight political news is exaggerated.”

Perhaps… although with tens if not hundreds of billions in coiled gamma positions just waiting to be trigerred should the VIX surge not that much more, today could end up being a very ugly day. 

Cutting through the political noise

 

I think the risk-off response across markets to overnight political news is exaggerated, so the risk is that strength in safe-haven currencies and underperformance from risky currencies may begin to reverse. 

 

The issue is that it is hardly new news that there is intense media and public scrutiny on potential Russian interference in the election, possible links with the Trump campaign and the more recent firing of FBI Director Comey. However, the issue remains that Republican legislators control the levers for any disciplinary action. This means that markets should be more attentive to the degree to which any further revelations undermine support for the administration in Congress, the rest is just noise. 

 

It can be debated whether the response from Republican leadership to overnight news has been more circumspect than has often been the case in the past. However, our assessment is that there has yet to be a more concrete, tradable signal. 

 

The more concrete signposts to look for will be:

1. Any substantive acceleration in ongoing Congressional committee investigations which have been progressing only slowly. This would take the form of subpoenas for testimony or information, since legislators have in most cases shied away from using the most powerful tools at their disposal to prod the investigations along.
2. The special house elections in Montana and Georgia. The Montana at large election is on the 25th of May and the second round vote for Georgia’s 6th district is on June 20.
3. The appointment of a special prosecutor by the Justice Department.

Since the former will proceed only slowly and the latter looks somewhat less likely, I think the special House elections are potentially bigger market events. Since these events have rarely come up in client conversations with a range of investors, I think the market is probably underestimating the extent to which these could prove catalysts for volatility.

 

It is a relatively steep uphill slog for Democrats to take these seats, but even significant Republican underperformance vs. polls and previous performance is likely to be seen as a major marker that Congressional support for President Trump is slipping and the market would probably extrapolate some acceleration in this phenomenon ahead of the mid-term elections in 2018. 

 

Since the implication would be that this would further imperil the White House policy agenda and could introduce an additional layer of political uncertainty, this would be a stronger signal for outperformance from non-USD safe-havens.

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After a record-smashing period of calm, the storm is here…

After the longest period of calm for the S&P 500 since 1969…

 

And the longest period ever of low vol closes…

VIX has just broken above its 200-day moving average…

 

Spiking by the most since Sept 2016…

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While traditionally Beltway events such as House speaker Paul Ryan’s press briefings have little if any market impact, in light of recent developments where literally in the span of 24 hours suddenly the market is obsessed with everything coming out of DC, one no longer knows may or may not be market moving, so erring on the side of caution, here is a live feed to today’s press conference by Paul Ryan.

It goes without saying that any discussion of ongoing Trump scandals will be of key market interest.

via http://ift.tt/2pU2UrO Tyler Durden

Bonds have been hit hard since the highs around the 4th of July last year. Could this big decline, be creating a bottoming pattern? Bottoms Up for bonds?

Below looks at the pattern of TLT over the past couple of years-

 

CLICK ON CHART TO ENLARGE

Last summer when bonds were peaking, it was easy to find bond bulls, as bullish sentiment for bonds stood at 90%. Today its not so easy to find bond bulls!

TLT could be attempting to create a reversal pattern (inverse head & shoulders) following a 20% decline from the highs. The inverse H&S pattern is far from proven at this time. If TLT would break above neckline resistance, it would increase the odds that this reversal patterns is important to the bond market.

 

 

Website: KIMBLECHARTINGSOLUTIONS.COM

Blog:  http://ift.tt/2nMNRyT

 

Questions: Email services@kimblechartingsolutions.com or call us toll free 877-721-7217 international 714-941-9381

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Authored by Goldbroker.com's Helder Mello Guimares via Acting-Man.com,

Chugging along in Nosebleed Territory

Last Friday, both the S&P 500 and the Nasdaq composite indexes closed at record highs in the US, with the Dow Jones Industrial Average only a whisker away from its peak set in March. What has often been called the “most hated bull market in history” thus far continues  to chug along in defiance of its detractors.

 

Can current stock market valuations tell us something about the future trend in gold prices? Yes, they actually can.

 

S&P 500 Index; according to some observers – experts even! –  “nothing” can possibly derail it. Usually these opinions are proffered just before “something” does somehow derail it after all. [PT] – click to enlarge.

 

There are certainly plenty of reasons to believe US equities are overvalued and that stocks may be reaching a major cyclical high. Equity valuations are not cheap by almost any measure, real GDP growth remains at a tepid 2% YoY pace, and short-term interest rates are finally on the rise.

While there is always the possibility that a major bullish move may be in the works for stocks, potentially on the back of “Trumponomics”, it is well worth considering at this juncture what Warren Buffett once called “probably the best single measure of where valuations stand at any given moment”.  The ratio of total stock market capitalization to GDP, a favored indicator of the “Oracle of Omaha”, has historically proven to be a very useful and reliable harbinger of longer-term future returns in equities in the US.

It’s important to point out that current levels of the ratio at nearly 130% imply negative total returns on equities over the next decade, meaning dividends will likely be unable to offset capital depreciation. Ominously, the ratio hasn’t been this high since Q3 2000, when the market was near the very top of the Internet bubble. Investors with a 10-year horizon who bought into equities during that period eventually earned annualized total returns of -2.84%, meaning they lost over 25% of their capital in nominal terms. This has very interesting implications for gold prices.

 

The “Buffet Indicator” (market cap to GDP) vs. subsequent annualized 10 yr. returns, inverted.

 

Let’s consider the relationship between the “Buffett indicator” and subsequent 10-year returns on the S&P 500 since 1978, as it allows us to draw a comparison with the data available for LBMA gold prices. Given the nearly 40-year correlation, a statistically significant linear regression suggests the metric currently is consistent with annualized total S&P returns of -1.27% from now until Q1 2027, for a total nominal return of around -12%.

In other words, a “buy and hold” strategy in US equities at the moment appears to be a losing proposition for the next decade. Interestingly, for every 10% increase in the ratio there’s a nearly 1.6% decline in prospective S&P 500 returns, as shown in the diagram below.

 

Returns implied by current market cap/ GDP ratio vs. data since 1978

 

The Stock Market vs. Gold

Now consider the correlation between returns on the S&P and those for gold over a 10-year holding period. Not surprisingly, the correlation is both negative as well as statistically significant. In other words, lower equity returns over a 10-year period have been clearly consistent with higher returns for the precious metal.

Specifically, using data since January 1978, every 1% drop in annualized total returns on the S&P 500 implies a 1.5% increase in returns on gold. At present, annualized S&P returns for the past 10 years at 5% are consistent with gold returns of 8.30%, compared to the actual returns of 6.51%.

 

Returns on gold vs. returns on the SPX (inverted on lhs chart) – click to enlarge.

 

Now, here’s the main point. Prospective annualized total returns of -1.27% on the S&P over the next 10 years would be consistent with returns for gold of around 20.6% on average per year. These are very enticing returns for any asset class over a 10-year period and would make any portfolio manager envious: they are literally Warren Buffett-like returns.

In addition, since 1978 the annualized total return required for the S&P to outperform gold stands at 7.44%. In other words, when equity returns are below that, investors are better off owning gold than they are large-cap stocks.

 

Conclusion

The very real prospect of negative equity returns over the next decade alone provides a compelling case for using gold as a hedge, and investors seeking capital preservation may wish to include the metal in their asset allocation. Given present levels of stock market capitalization to GDP and prospective equity returns, it would be reasonable to expect 15%-20% returns per year for gold over the next decade.

The monetary experiment led by the world’s major central banks by way of quantitative easing has done much to inflate asset prices since the global financial crisis, and at this point having an allocation in gold appears very sensible.

via http://ift.tt/2rqN6Oo Tyler Durden

With Trump impeachment odds spiking…

 

The first Congressman (Maxine Waters must be pissed off) has come forward to demand Trump’s impeachment…

Today on the floor of the Congress of the United States of America, I will call for the Impeachment of the President between 9am & 10am CST.

— Congressman Al Green (@RepAlGreen) May 17, 2017

For now it is unclear what Congressman Al Green’s reasoning is… apart from anonymously-sourced evidence-free reports from a clearly biased mainstream media perpetuating a narrative designed to ‘resist’. Apparently Trump “obstructed justice” – we hope Mr. Green has some evidence to back up his accusations…

.@RepAlGreen to @ABC: "The president is not within his rights…when it comes to obstruction of justice." https://t.co/tTVq2aJqWb http://pic.twitter.com/dbOh0tKMMr

— ABC News Politics (@ABCPolitics) May 16, 2017

15 minutes of fame?

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