What’s new

True doubts are better than a false certainty . Maybe .

02/01/2023 09:50 GMT

A Children Play : follow up .

Let’s give a look at last 01/18 post , after month’s end update :

Five of best YTD performers were among last year’s ten worst ; seven of worst YTD performers were among last year’s ten best . 50% (5 of 10) are bottom fishing , 70% (7 of 10) are profit-taking .

Conversely , cryptos :

Among cryptos , all negative last year , no profit taking , but the five worst 2022 performers are the best YTD . 100% (5 of 5) bottom fishing . Crypto’s is a younger market vs. traditional assets : more adapt to children play , then .

But when profit-taking moves are prevailing , as per first table (70% vs.50%) , it depends by bets on this evening FED move ; a softening stance is awaited (+0,25% vs. last +0,50% move) : markets , as usual , tend to anticipate news . If FED’s stance confirms expectations , markets could monetize YTD bottom-fishing gains ; if Powell instead says : “today +0,50% , but next moves will be lower” , softening expectations will be postponed ,and bottom-fishing will go on .

01/18/2023 17:00 GMT

A Children Play ?

Let’s give a look at 2022 best and worst , and 2023 year-to-date …

And about Cryptos ?

The worst in 2022 are the best year-to-date , and vice versa . Market gyration , or a piece of cake ?

01/12/2023 15:24 GMT

As it turned out…

December CPI : -0,1% m/m , less than 0,0% awaited , down from 0,1% previous ; core CPI (ex food and energy) + 0,3% m/m , as awaited , but up from +0,2% previous . Just goes to show .

01/12/2023 10:00 GMT

The Fantastic Four

On January, 01 on this page we wrote that being “prudent” in 2023 allocation choices was excessive , because after a -30% on stock indexes as Nasdaq last year , a rebound and a positive mood was the most probable outcome for current year , being aware of volatility . The first development , as seen in these first ten days , is positive , awaiting the CPI data for this afternoon that would confirm a receding inflation . Maybe core inflation variation , i.e. without food and energy (volatile data) , won’t be so positive , but markets have already bought the best probable outcome : “sell on news” could well happen after data . If you have cash to invest , a lot of proposals are on the desk : offered interest rates are up to 4% , a very interesting level , after years of zero per cent , but is only the half of stock indexes performance year-to date (about 8% in average ) , a sole week against a yield for twelve months . Your liquidity is needed , they pay a good price for it : then , liquidity will be lent to professional investors to make gains in stock markets . Four is fantastic , but not for you .

01/10/2023

Histoire d’O(nxeo)

The higher performance since year start , +214,29% , belongs to ONXEO , a French clinical-stage biotechnology company ; recently it’s testing a new treatment for solid tumors .

Below its chart , modelled on Charts site’s page (where is as an example , 3M stock) .

01/01/2023

2022 : Missing in (FED’s) action .

Dear users , after a 2022 very difficult for risk markets , the big part of financial actors suggest to be “prudent” for new year 2023 , avoiding further damages for portflios , because volatility is expected to stand high. Now we all know that volatility means ample oscillations for indexes and bonds , and your performance will depend by the moment of calculation . But we also know that volatility means opportunity ; if you can catch it , damage could turn in profit ; of course , waiting for long period , as advised from they who don’t know how to read markets and their dynamics , but know well that long time means much money (for them) , is never the best way to afford markets’ environments . Looking at site’s strategies performances in 2022 makes all clearer for smart investors. People look closely FED actions and their effects on risk markets to decide their own risk level and consequently how to act . Then , I gave a look to last 40 years of monetary policies , and relevant yearly performance of worst Us index in 2022 : Nasdaq . The chart below says some interesting .

In Horizontal line , the FED yearly actions , i.e. difference between start and year ends ; in Vertical , Nasdaq yearly performance . Curiously , green dots ( positive Nasdaq years) are near vertical axis , meaning that when FED didn’t act , or moved by a little interest rates , markets liked it . Worst performances were in 2008 (Lehman crisis) and in 2022 (Inflation roaring) : more curiously , two years opposite as monetary policy : the former saw a – 4,25 (january/december) , the latter a +4,08 . Clearly are not FED moves , but WHY Fed moves that matters ; 2022 was (and 2023 will be too , at least first half) a continuous running to macro data , trying to understand if US were sliding in recession ( and awaited , or hoped , rate cuts) , or economy will sustain inflation , with labor market closely watched . This fatigue is not very useful : who can , has already decided what year 2023 will be for world finance. Markets will follow . And we’ll follow markets too , using market instruments that best fit , whatever direction will be , whatever the trend . Standing was the worst choice for last year , and probably will reveal the same in 2023 .

12/13/2022

Target2 : a(n) (in)balance

Periodically Target2 ( the gross system payment of Euro Monetary Union) balances return as an argument of discussion , and every time “balances” are always more “imbalances” , the countries that are debtors vs. the system become more indebted and those who have a credit position see their active growing . Something doesn’t work , as an evidence : one of the reasons of such differences has its roots in fixation of parities among currencies , when Euro became the sole currency of the union . Countries with strong economies and constant trade balance in positive , (Germany) , so as countries with a constant capital flux (Luxembourg)  see their active growing month by month . The parity of their currency had to be fixed higher to reflect that condition ; weak countries (negative capital flux , high public debt , weak trade balance) were fixed at an excessive parity , unsustainable by their economies (Italy , Spain , Greece) . Moreover , interest rates are common : Germany standing alone would pay a lower interest on its public debt , while Italy would see it spreads skyrocketing . This situation contributes to imbalances . Strong nations pay a cost in terms of higher interest rates to export and attract capitals ; weak ones pay less on their debt , but their situation on imbalance in Target2 become higher and higher . In few words , weak countries are getting weaker , strong ones are getting stronger , as demonstrated by data evolution . In a single country , weaker zones can be helped by more progressed regions , a strategy based on fiscal policy and wealth redistribution, to support an organic growth : at common level , fiscal policies are not coordinated , but debts give the scepter of power in strong hands , and them won’t renounce to this , calling for weak countries’  inadequacy to face a serious economic policy . PNRR will enhance imbalances . An instrument to confirm the status quo , apart from declarations . A serious monetary and fiscal reform would be needed . Parities where inadequate 20 years ago , nothing has changed , apart from growing imbalances as a logical consequence .          

12/11/2022

A busy week

Next week will be very busy : future expirations , macro data and central banks actions will pave the way to year-end values . Monetary decisions : FED , Swiss National Bank, Bank of England, European Central Bank , Mexican and Russian central banks actions are awaited . Macro data : USA Consumer price index on Tuesday , one day before FED decision , and then Retail sales on Thursday ; Euro area inflation data on Thursday . Equity indexes futures expire on Friday , followed on Monday by currency futures on major crosses . All market movers, in few days, close to an holiday period and year-end (and consequent low liquidity) : wide markets swing expected . Someone will enhance 2022 performance (a few) , others (the most part) will confirm a negative one , and will prepare the relevant arguments to justify it with relative customers : pandemic, politicals, inflation and so on … calling for a “long term” view and forgetting that long terms results (where all are in a “waiting-mode”, much more comfortable for advisors) are made by short terms sum (when a fews make the difference, working hard in de-correlating from negative markets) . Definitively , 2022 confirms the base reasons for an active stance on markets , rather than a passive one . For further details , please see Currency Trends page for incoming weekly events .

11/21/2022

A vaccine for bears .

11/21/2022

Still alive trend

Referring to our post in this page on October 01 and June,18 , let’s give a look at the same chart , updated at 11/18 (last friday) . Considerations made 5 and 3 months ago are still alive (and kicking…) ; inverse correlations are clearly evident .

October chart
Updated chart

11/04/2022

To Act or not to act , this is the question .

10/24/2022

A ZIRP’s hard legacy .

10/20/2022

A growing trade imbalance

The chart below shows last 12 months’ trade (im)balance of global trade trend in Japan .

As per our 07 September comment on this page , a weakening currency , in the import/export balance , implies major costs for basic materials (that Japan imports) , but export prices are more competitive in different currencies (those of external buyers ) . But trade widening imbalance (the difference between curves) pushes currency south , despite BOJ recent intervention on fx markets . BOJ has to fight interest rates gaps and , more important , trade gaps between imports and exports . A very difficult twice task . A weak Yen is useful for markets speculation (who borrows yens at lower rates) , and for exports . Maybe Japan isn’t really willing to change currency trend , apart from public declarations …

10/18/2022

Buying Usa by the Yen .

Dear user , as usual , on Charts and risk strategy page , you will find S&P500 and Nasdaq indexes , converted in Gold quotes (i.e. how many Gold ounces are needed to buy an Index) . Let’s now give a look to an S&P Index chart , whose quotes are multiplied by Usd/Jpy cross ; that’s useful to show a speculative strategy , very frequent on markets : buying the Index by Yen borrowing . Japanese Yen has the lowest interest rates among main currencies , so is the cheapest debt strategy . Below is the relevant chart :

As you can see , in shadowed areas , corresponding to 2000,2008 and 2022 years , the Index multiplied by Usd/Jpy (blue line) was higher than Index till it crossed from above the Index (red line) . When it happened , a  market correction followed . Actually , thanks to Jpy depreciation , the blue line is higher , but correction is already on the way : interest rates are growing globally but not in Japan , so its currency is historically very weak , sending the cross to its top (around 150 Jpy/Usd) .       

In next chart , referring to last 20 years , taking in account Yen interest rates  , every 6months we borrowed at Jpy Libor 6m flat and we bought the Index ; blue line now shows the trade result ( i.e. Index performance less borrowing costs , calculating currency cross variations) , red line as usual is the Index course .

 Note that blue line Trade results is , for first time in 20 years , higher than Index ; that’s due to strong Jpy depreciation and new interest rates environment on Usd . The table , updated to yesterday’s quotes , is as following :

Bottom right of the table , the historic average of difference between lines (and between Trade and Index) till last year was about 37 ; comprising current year the average is about 31 , 20% less than global historic one. Interest rate environment has muted , the Index is suffering a deep correction , and Japanese currency is at its lows . To come back to historic average , Index must recover 25%-30% (544 vs. actual 418,73 , always 100 based) , as the last table 2 rows below modified :

or Japanese Yen  must recover about the same percentage , as below , from 506 to 381 .

Will markets dynamics adjust the average ? Or central banks , intervening on markets , will be able to correct the trend ? BOJ recent intervention shows that latter remedy won’t solve recent imbalances .

10/16/2022

On Long-Short Strategy page , you’ll find a new chart , weekly updated , showing Strategy’s evolution and difference with index in either positive and negative market phases . The widest the market corrections, the widest the differences ; note that Strategy offers positive results whatever the phase is.

10/01/2022

Long term trends , alive and kicking .

Referring to our post in this page on June,18 , let’s give a look at the same chart , updated at 09/30 (last friday) . The only difference is 10Y government bons Yield , now tracked instead of premium at risk , to better show relations between interest rates and risk markets . Considerations made 3 months ago are still alive (and kicking…) .

Now, let’s remember , on our 08/22 post on this page , the chart below (at related date close . not recently updated) . First S&P bearish target has been crossed (3.680) ; the next one is at 3.329 , about 7% south of last close (3.585,62 ) . Whatever of those levels is crossed , will show the way . Trends always tell the truth . They don’t bear conflicts of interest .

09/23/2022

Out of risk

Central Banks have turned hawkish after over ten years of low or zero rates , whose effects in economies were much lower than those on markets, complying to big finance needs of zero cost money. Now that big finance exits from markets , Central banks are free to move up rates . As for currencies: speculation doesn’t need anymore a lowering yen to finance their buys, so BOJ can intervene on markets and try to support its belaguered yen . Exit from risk markets has been decided; would you stay in because you have to look at “long term”? And what’s about next years with big finance out ? Will you win? Can you afford an half of portfolio loss , after doubling it (if so) in last decade ? Think carefully .

09/21/2022

New indexes on Homepage strategies’ results detail .

As for other indexes and assets , you’ll find on Emas Strategy page the dates and levels of intervention (long and short start positions ) .

09/18/2022 New page

A new page has been added to menu : Macro Indicators , where you’ll find an analysis of some Macro Indicators for USA , the most observed by market actors , based on their trends and correlations . Further studies will follow on that page .

09/16/2022 New charts

On Selection strategy page , new charts show high/low beta and ratio selected stocks percentages , and their interpretation .

09/13/2022

A not surprising surprise

CPI data today surprised markets  with an upside of core data (excluding volatile energy and food) . Core CPI is the best item to measure the gauge of inflation . People asked themselves : why in august , when Oil prices went down , inflation has gone up ? Because the correlation between CPI and WTI is positive , has grown in last 2Y , but the most correlated data to CPI are House prices .Let’s see 10years chart :

Let’s see now 1Y chart :

Data correlation at 1Y and 10y :

As said , WTI correlation has grown , but Housing prices have remained steadily increasing and highly correlated to CPI . That’s why CPI didn’t slow in August , supported by  record housing data . Higher interest rates will shake mortgages and prices , as is already happening in last weeks , but we’ll see later their effect on consumer prices  . Nor Oil , nor Job market set the inflation trend : housing do . Remembering economic basic principles , a dollar poured in construction spending is multiplied much more than in others sectors : and less dollars in housing markets (because of higher rates) will reverse ongoing inflation , or at least limit its growth .

09/08/2022

A vaccine for headache .

As widely awaited  , today ECB hiked rates by 0,75 . Inflation is too high , ECB president said , and they need to block it and go back to 2% target . Now we don’t want to bore you with a lesson of economy ; lifting rates in this environment is the wrong therapy for illness : it’s like to use a Covid-19 vaccine for a common headache . Demand-driven inflation has to be fighted by higher rates : it’s not actual kind of : it’s driven by a shortage of basic materials , so is the offer , not the demand , the real guilty . If Russia stops to export grains , adding to global shortage caused by droughts ,and bread and pasta prices will skyrocket , could a new rate hike work against price surge ? Certainly not . The medicine is wrong . The doctor is wrong .

09/07/2022

Holding back the y…en .

Thinking of recent evolution of Usd/Jpy cross , let’s go back to our post on this page , dated 03/28/2022 , when we wrote about it . Multi-years trends are roaring back . Japanese authorities today said that an open market intervention to counter the Yen weakening wouldn’t be useful , because of dollar strenght , a trend that is difficult to fight . But do they really want to counterfight Yen weakness ? Let’s imagine we were a Japanese manufacturer. A year ago we bought the raw material for $ 1 (100 yen), produced the good and sold it for $ 1.5 (revenue 150 yen); margin of 50 yen . One year after , the exchange rate is at 140 yen/dollar and we assume that the cost of raw materials had risen by 50%. To buy at $1.50 the price-increased by 50% commodity, it now costs us 210 yen (1.50 x 140). To keep our margin of 50 yen, we have to sell at 260 yen, i.e. at $1.85 (1.85 x140 = 260). It means that, faced with a cost of production increased by 50% (for the whole world), our selling price is 23% higher (1,85-1,50) . If those who produce at dollar costs (at the initial and highest actual same costs) and sell in dollars our same (or similar) items want to be competitive with us, i.e. mantaining the same margin of 0,50 usd ,they have to give up a part of the profit, or raise prices by more than our 23% on the common market . Within certain limits, it is not such a bad scenario for jap exporters , we suppose .

p.s. (post scriptum) : will European producers and exporters start think and behave in the same way ?

09/07/2022

To hike or not to hike : this is the question

On Thursday , ECB will decide its interest rate move . As ECB’s prime target is fighting inflation , last data would point to a rates hike , but actual dilemma is that the dynamic of prices in Euro area depends on external factors , i.e. it’s not a demand-driven inflation , or only in part . Economies have rebounded after pandemic , but energy and commodities prices (an external factor , as Europe import most of its needs) are now the most notable cause of prices increase . Many firms will borrow money to cover energy costs ; lifting rates will traduce in more costs : the risk is now that an hawkish ECB stance would deepen inflation , as firms (if survive) rebate on customers their costs . The other way could be to rise rates (75 basis points)  , together with a price cap on energy prices ( and/or a massive public help to buy energy) to limit further inflation . Today a strict coordination between monetary policy and European political decisions is needed as never before . And never as today monetary policy shows its inadequacy to face issues .   

08/26/2022

Do we need another hero ?

In today’s speech from Wyoming , Fed’s governor Powell confirmed the hawkish stance on inflation fighting : pains , he said ,would be bigger if he doesn’t do … “whatever it takes” (not the same words, but the same meaning ) … to get the 2% objective . In the past , that sentence marked the Euro defence , when Ecb’s president gave the start to a qualitative easing , addressed to save the most indebted European countries . But central banks can address and advice , the dark job is in the governments’ hands , is a political question , not only financial . Social and fiscal imbalances make difficult to pour monetary moves into credible targets ; it can work for some time , then reality , before or after , comes back . However the big finance’s message , as per today’s stocks markets trends , is the same as usual : we need low rates to enhance our gains , not heroes .

08/25/2022 Strategies operations

On Futures page , now are shown intervention levels for yesterday’s signalled operations ; on Long-Short strategy page , you’ll find detailed daily operations .

08/22/2022

S&P last corrections and recoveries : Golden Rule?

08/19/2022 New futures chart

On Futures Page , a new asset : Natural Gas (Henry Hub) futures !

08/18/2022 New Strategy !

Charts Page has been modified and renamed, now show also Risk Strategy chart . For strategy basics , please see page How to .

08/14/2022 New page !

A new page on site : what’s behind , a strategy background.

07/23/2022 19:46 Gmt

07/21/2022 15:25 Gmt

The Transmission Protection Instrument , friendly TPI ; means maybe TPI also Too Personal Interpretation ? Or P is for “Political” ?

Today , ECB revealed TPI headlines . What it is , you can read on related ECB page . What it really is , you can understand by its details , where often , as people say , devil stands .

Well , 4 criterias are defined for such type of intervention , a series of compliances with Eu fiscal framework , the absebce of an outstandig excessive imbalance procedure , and so on , to fix the borders of countries eligibility to instrument . All that criterias are rooted in a sound economic and financial environment of a country as a prerequisite for its use . But as said , the devil is in the details : under “Activation” paragraph , few rows below , the statement says : Purchases would be terminated either upon a durable improvement in transmission, or based on an assessment that persistent tensions are due to country fundamentals. So , let me understand : can a country with weak fundamentals has been compliant with EU fiscal framework ? Can such a country has been compliant with commitments of Recovery and Resilience Facility , and so on ? The judgement on “fundamentals” , this way , appears very difficult . The real is that such compliances are easy to be determined , and easier can be doubted , more today than before .

07/21/2022 Selection Strategy results

On Selection Strategy page , a new chart shows strategy’s results , starting from mid-April 2022 (last 3 months) . Results are net of dividends but gross of trading fees .

07/11/2022

A busy week

This week will be important for micro and macro reasons . The earning season , with results of II quarter , is kicking-off , starting from financials ; the focus will be on outlooks  for next period . American Price Indexes and Retail Sales will drive attention on macro environment  , the former about inflation standing  by core data , the latter to show reaction of consumers to rising prices . Stronger than expected data could enforce US dollar  through parity quote vs. Euro , but European  stock markets are in a better shape , due to expectations of a more dovish stance from ECB , and financing positions is getting cheaper , due to rates differentials and Euro weakening too .

07/04/2022

Fragmented fundamentals

Today , the chief of an european national central bank  marked some important points for incoming new instrument anti-fragmentation by ECB . Among these , the precondition that , if a spread could depend by speculation and not by FUNDAMENTALS  of each issuing country , the instrument wouldn’t be activated . Everyone knows that speculations bet on fundamental differences , widening the yield spreads in risk-off markets trend . The real problem is that a monetary union , and a monetary common policy , will work only between countries which have similar fundamentals , i.e. fiscal policies , cost of labour , debt/gdp ratio , pro capita  domestic product etc. Different countries do have different fundamentals ; only an effective convergence to a common economic policy (if really wanted) could be the precondition to an effective monetary policy . Finally , when Euro parities were fixed among euro currencies , was the criteria of fundamentals  followed ? Or some currency , in fixing euro parities , was undervalued  to let its country more competitive in exports (someone said : to cover reunification costs) ? Probably , the same ex-euro country currency , whose central bank chief spoke today. Sometimes fundamentals aren’t important , sometimes (as today) they are .    

06/28/2022

Trilussa docet (docet = teachs) .

Trilussa was a famous Italian popular poet , born near Rome at the end of 19th century . One of his most known sentence speaks of statistics . He said : “If I ate two chickens , and you ate no one , then we ate a chicken each one” . Numbers can be very useful , but sometimes their use can show curious results . Let’s consider now recent administrative elections in Italy : at last ballot round , two millions people were called to vote their candidates. Only 40% did , so about 800.000 . About 60% of them voted for a party coalition that won some city majors , as to say about 500.000 voters , i.e. , considering Italian population is about 60 millions , less than 1% . The coalition that won proclamed it a victory , and said it was an event that strenghtened their power and consequentially the actual goverment they support . Well , numbers speak : a “wide” and political victory . Conceding that the remaining 99% of population thinks and would have been voting the same way . A little hazard , in my view . Trilussa docet .

06/22/2022

On Currency trends page , algorithm that monitors currency crosses of Gbp,Cad and Aud vs.Jpy has been modified to take in account a surge in Jpy volatility ; strategies performance have been corrected accordingly .

06/21/2022

New currency cross added

On Currency trends page , a new currency cross has been added for analysis : Bitcoin vs. Usd As S&P (48m) graph on chart page , the 12 months trailing yield is now still positive , but single digit : last time it happened was on 2018 las quarter and in 2020 october . It has entered an oversold area , but could well deepen , as in previous periods ; in short term , a rebound is likely , but won’t defy the weakening trend . In this phase , time is all , don’t fight the trend . Fed decisions , geopoliticals and corporate earnings will confimr or change the direction.

04/24/2022

Currency trends page charts

On Currency trends page , when a signal of buy or sell occurs , the relevant chart is highlighted in black or red , to better detect the day of intervention .

04/22/2022

Message in a bottle

Yesterday stock indexes went down on Fed’s chair remarks about the stance of monetary policy tightening , that could be faster than previously to fight inflation . But in a recent speech he said that a strong Us economy can face a rate increase . Economy could , but stocks prices ? And price/earnings ratios ? So the yesterday’s message from finance to Fed is : don’t run too fast , don’t squeeze our margins (their earnings less the cost of money they borrow and invest in stocks ) .

04/15/2022

The day after ECB

As written in my 04/06 update , ECB is forced to a dovish stance .

04/11/2022

What a difference a vote makes .

French presidential elections’first round , in many comments , would signify the passing of traditional difference between left and right parties , shifting to pros Eu and cons . That is true in terms where people can’t feel european istitutions close to their interests , and when social differences are widening and middle-classes , who still represent the majority , are losing economic power . The real message is : difference among nations’interest can’t let them forget the most important challenge : to make people better , and evidence shows that this target is not percieved as a priority from supra-national institutions . Deepening differences are dangerous in perspective of a real union , because fight against it . Political shifts are mirroring this scenario .

04/07/2022

Long-short portfolio composition

On Long-short Strategy page, a new chart “Current composition” shows daily current long-short portfolio percentages : longs, shorts, and cash , allowing , from another viewpoint, a focus on current stock markets environment and its mood .

04/06/2022

Inflation as sanction .

Euro weakness depends on geopoliticals events ; sanctions against Russia have disruptive effects on Europe , because the uptrend of energy prices (energy from Russia indispensable for Europe) raises inflationary pressure and has negative implication on economic growth too. Markets’ idea is : FED can rise interest rates , ECB can’t (or not enough) , not to deepen economics , and so Euro currency’s purchasing power will weaken , due to inflation , and consequently the Euro slides under round figure of 1,10 against Usd , nearing parity with CHF . Interest rates curves clearly show the difference of inflation expectations between Euro and Usd , better than reflecting a different awaited economic growth speed .

04/05/2022

New trailing yield charts

On site Charts page , you’ll find two new charts ; the first shows trailing 12 months yield on S&P index , dating back to 1969 , the second shows the same yield for last 4 years to date .

04/03/2022

Homepage has been added with three summary charts , to give a look at actual market sentiment , applying Ema’s Strategy to main assets and indicators .

Gold is a part of the answer : in spite of awaited inflation , and rising bond yields today , it isn’t moving so much , holding 2k figure . Tomorrow’s ECB council and next week’s futures expire will give the second part . And , of course , geopoliticals developments in eastern Europe . Grains and basic resources are retreating , coming back from an “overwhelming overbought” phase . A building spike in indexes , if confirmed , will favour Europe and most beaten sectors , as financials in that area , such as Euro currency , gaining ground versus defensives as CHF and Japanese Yen .

03/05/2022

No fly zone .

Actually , in financial terms , that zone is stock markets , and commodities too . Buying the deeps , or the tops , is dangerous ; deeps can be deeper , tops can hardly reverse . Awaiting trends inversion could be the right move.

A new kid in town .

Today you’ll find , in Futures page , a new study .

03/04/2022 midday

Big figures in play .

Eur/Usd crossed 1,10 , Eur/Chf approaching 1,00 , Eur/Cad near 1,40 . High volatility until next ECB meeting on 03/10 , then 03/18 futures expiration . Two weeks which can make the difference .

03/04/2022

Flattening the Euro curve , steepening Usd .

Be careful on bank and financial european sector .

03/03/2022

Ceasefire ?

Geopoliticals have invited The Fed to a more dovish stance . That’s what speculation wanted , a gradual path to raising interest rates . Will be enough ? Longer bond futures prelude to a more inclinated curve , discounting inflation expectations , still alive , but less kicking .

03/02/2022

Don’t stop the dance .

As the famous song . WTI over 100 , gold longer dated futures over 2K. Bonds are soaring , forgetting inflation , or discounting a stagflation ? Signs of overbought markets , till speculation will decide it’s enough .

02/26/2022

The costs of democracy .

Actual situation of war in Ukraine has deep roots in political and economic developments of last decades. Globalization has linked the world together as never before , but energy and agricultural materials , not saying rare earths , are produced and exported mainly from countries where demo-cracy is still an issue .

If democracy stands for sharing the decisions with all the participants , the commercial ties with those countries let open many questions , such as the dependence for gas, oil and basic materials .

When we speak about fossil fuels , for example, or about grains , we need a very higher quantity of energy and food than before , as demography shows . Inflation today is not only demand-driven , after pandemic ,but is coming also from the lack of coordination and agreement among countries , and from resilience of old energy politics (and interests connected) to adopt new sources of basics . Many say that to counter global warming has high costs , but being unready to tackle those political issues , is the real problem now , as costs to pull together different minds , ideas  and concepts of a modern state , is becoming  , day by day , the first trouble . The awareness of common , worldwide interest as an absolute priority , is the only way to start to resolve it . Guns have never solved anything .

02/24/2022

Black Thursday ?

Futures are in red zone , updates are no favourable to risk markets ; can past help ? March month 2000, internet bubble bursts ; 2008 , financial crisis starts ; 2009 , always march , stocks start the positive decade which is still ongoing ; march 2020 , the covid deep . Often , spring season changes scenarios . Will we have a swift spike (down, then a rapid recovery) as 2020 or is this a start of a longer phase ? Too soon to make a judgement . But the message is : watch carefully markets developments , looking at next Fed moves . As said in last comment below (02/22) , would a rate increase be decided while swords are clashing (Ukraine) ? Hopefully not , says speculation . Inflation will spike if basic materials continue to grow, but now we can say it’s temporary : we hope .

02/22/2022

Actual geopolitics news are dominating the scene . But are they very new? Putin’s “make Russia great again” is going on , reinforcing ties with China . After Krimea , the Donbass : and next? Let’s go to the West : mid-term elections propaganda is going on : more are Biden’s difficulties , the best for President’s opposition party , the best for China and Russia too . And Interest rates ? Could the Fed raise interest rates in a war environment ? People says : not . The best for global speculators ,too . Too many are gaining from this scenario . Let’s wait and see , but be careful about your risk profile . Last but not least , basic materials were the last resort in gaining perspectives : and they’re going up , as desired . Is it a plot ? Probably not ,but, when many can make gains , apart from wars, deaths and peoples escaping , nothing really new under the sun .