25 – 29 May 2020 Trading week preparation

Every week I share a bunch of stuff.
– Daily signals for MA Crosses and MA breakouts
– Market Reports
– Consolidated market data
https://eod-notes.com/shared-content/
From last week:
I just had an horrible trading week,I have been having a lot of trouble keeping focused and being patient.
That made me mismanage all my trades, bad stop placement, bad risk management, bad entries. You name the error, I made it.
My AUDJPY short got stopped with a loss, the gold long scalp got stopped for a small profit.
Tried to revenge trade a short scalp STOXX50 with a very poor entry which I magically found a way to mismanage too.
I have been super stressed all week and obsessed with trading.
To salt my wound even more I found a major bug on one of my algos.

I am still a little bit frustrated with my mistakes, simply because I know better.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    Looks like SP500 doesn’t want to go down. The Powell printing press is life supporting it.
  2. US bond yields are going to zero.
    It´s happening, not much to say
  3. Gold and silver will go a little bit lower before acting as safe heavens.
    I though I was wrong on this. But maybe, just maybe, I am right. Will explain more below.
  4. Commodities will behave like gold, specially grains.
    Mainly grains, are having a bad time. Still a wait and see game.

Next Week:
A lot of work to do this week, mainly focused on getting back on track.
Will stop day trading. It´s not my trading style, I need to get back to my roots.

Will have to sort out how to fix the bug, that still is an issue. The algo is stopped at the moment.

Need to start exercising again, the brain and the body go hand in hand.

Will take my time and align myself with what works for me.

That being said, markets never stop and I am keeping an eye on a watch list.
Things are getting interesting in some sectors, and the alligator mode is ON.

CRUDE

It´s still a no mans land. No one have a clue on whats next. It´s true crude has been rallying but the demand is still very weak. Technically It´s on a big cross roads. For me is a wait and see game. Let´s see how the triangle breaks. Inventories started to drawdown which may help the bull case.

Oanda WTI CFD Daily / Weekly
TANOS Market Gauge Crude Dashboard

GOLD
The yellow metal It´s on a crossroads too.
Market conditions made a lot of people seek refuge in gold but as long as market keeps going up people are feeling FOMO and started to sell gold to risk on again. Technically the path of least resistance for gold looks to be down.
The weekly candle shows that there area lot of indecision in the market.
If the technical setup activates, I will buy at the orange box ~$1580.
One curiosity, gold is trading away far from it´s mean reversion. Often, assets tend to return to their mean reversions lines.
I am very bullish gold long term, of course It must have is up and downs during the time.

Oanda Gold CFD Daily / Weekly
TANOS Market Gauge Gold Chart
TANOS Market Gauge Gold Dashboard

SP500
It´s fighting for It´s life. No one knows what the hell is going on, the fed crushed the bond market ETF last week with a major inflow.

https://www.trackinsight.com

It´s seems almost impossible to slay the SP500 dragon but the dragon is starting to show some cracks. On the 4h chart and on the daily chart, the SP500 is forming and Head and Shoulders pattern. If the 4h pattern triggers, it may complete the daily one, causing a massive sell off.

Oanda SP500 CFD Daily / Weekly

Same as gold, the SP500 is trading far above It´s mean reversion lines.

TANOS Market Gauge SP500 Chart

+50% of the index components and still below their bull/bear line.

TANOS Market Gauge SP500 Dashboard

Airlines
They have been slaughtered by this crisis. They are very big businesses some even too big to fail and will receive massive bailouts. As an alligator I must make sure I am looking to grab my bite.
I am focusing in two stocks , both European. Lufthansa and Air France.
Both companies are pending bailouts decisions by the German and French government. The stocks will probably pop when it is reveled.
This will be a very long flight until things are back in “normal mode”. I will enter small positions at first and averaging up and down as long as the stock moves. Airlines are a very volatile business. A stop loss is a must on this one.
The upside seem really juicy.

AF & LHA Daily Chart

Shipping
It´s interesting again. Shipping companies are having huge profits, companies such us $TNK Just beat earnings, and have an iron clad book.
I am looking into two stocks $TNK and $STNG. Both seem good to start buying.
Same as airlines, Shipping is a risky business so my guard is up and stop losses are down.

TNK $ STNG Daily Chart

CAD & AUD
Still very bearish both, despite my AUDJPY got stopped, both are still on my radar. I am waiting for a better sell setup. AUDJPY needs to break the rising wedge and CADJPY probably will retest the upper band of the channel.
JPY is also looking to break out.

AUDJPY & CADJPY Daily Charts
JPY Futures daily

VIX
I don’t believe one can TA(technical analysis) the VIX, although a lot of signals can be extracted from the VIX.
VIX curve structure is not pricing in future risks, risk mode is off.

http://vixcentral.com/

VIX short term spreads are bullish

VIX Short term spreads

VIX long term spreads are dropping really fast. The signals for a SP500 sell off are between -2.5 & -3

VIX long term spreads

Another Notes
Safe havens are zig zaging

TANOS Market Gauge Safe havens dashboard

Sentiment is a bag of mixed feelings:
AAII & NAAIM

TANOS Market Gauge Sentiment Dashboard

Fear Greed Index:

CBNC Fear &Greed Index

Insiders transactions, more selling

http://www.openinsider.com/

For last, total tape market volume is declining, a lot

TANOS Market Gauge Market volume dashboard

Articles:
https://www.zerohedge.com/markets/central-banks-are-buying-24-billion-assets-every-hour-their-balance-sheet-eclipse-20

https://www.bloomberg.com/graphics/where-hedge-funds-invest-13F/2020-q1.html

https://www.zerohedge.com/markets/retailers-reel-commercial-landlords-issue-thousands-default-notices

https://perchperspectives.com/reports/geopolitical-forces-shaping-the-2020s/

Events:
Monday
EUR – German GDP / German ifo Business Climate
GBP – Bank Holiday
USD – Bank Holiday

Tuesday
JPY – All Industries Activity
EUR – German Gfk Climate
USD – Consumer Confidence

Wednesday
EUR – ECB Lagarde speaks
CHF – Credit Suisse Economic expectations
USD – Richmond Man. Index

Thursday
USD – Prelim GDP / Core Goods / Unemployment Claims

Friday
JPY – Tokyo CPI/ Unemployment rate / Consumer confidence
EUR – CPI flash estimate / Core CPI flash estimate
CAD – GDP
USD – Core PCE / Personal Spending / Chicago PMI / UoM consumer sentiment / Fed Powell speaks

18 – 22 May 2020 Trading week preparation

Every week I share a bunch of stuff.
– Daily signals for MA Crosses and MA breakouts
– Market Reports
– Consolidated market data
https://eod-notes.com/shared-content/


From last week:
Finally managed to get some action!!!
Trades:
Shorted AUDJPY AT ~70.03 I will ride this one out. Will explain better on the ideas section.

Gold, yeah got long, maybe I was wrong after all. The breakout was insane.
Managed to get long at 1716.75.

For last also managed to scalp a SP500 short ~2904.6 (ytdMR) till 2816.5.

Got a few handles(short) on STOXX50 too but nothing worth mentioning, were quick in and outs.

Still long $AG.

Was a nice week, got a little busy and missed some opportunities.
The GBPUSD short and the long USDCAD I shared on last week post.
The first missed at all, the second one it missed my entry point.

I have been struggling to keep focused, I am trying to work on that too.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    This week he had a breakdown on SP500 I do believe the worst is yet to come.
    Macro numbers are looking ugly but the Fed…
  2. US bond yields are going to zero.
    Going, The Fed will started buy Corporate Bonds ETFs. This will escalate quickly
  3. Gold and silver will go a little bit lower before acting as safe heavens.
    Hey, maybe I am totally wrong on this one. If this does happen, I will use it to buy more gold.
  4. Commodities will behave like gold, specially grains.
    This will be an interesting trade, strong dollar, and EM FX weakness will probably drive soft and grains commodities down. Definitely keeping an eye on this.

Next Week:

Earnings Week 18 May 2020

More earnings:
Will be looking into: WMT,TGT,HRL,M,NVIDIA,BABA
There are a lot of Chinese companies presenting earnings. This will be interesting.

It´s time to start planning your stock shopping list.
I am not giving the speech about not actively trading your total portfolio.
What I will do is share what I am looking.

Airlines, yes they go bankrupt once in a while but they always, always survive.
Eying specially for Air France and Lufthansa. They should be target of government bailouts.

Iconic bullet proof brands, Coca- Cola, Pepsi, Disney, AT&T, etc
This brands have been with us since forever, they will remain here and wont go anywhere.

Food, not going the “Tech” way. Staying with the good old fashion stuff.
Hormel foods, Nestle, McCormick , McDonald’s, etc people are tired of eating at home and cooking.

Tech, why not boost your holdings on the best performance sector.
Amazon, Microsoft, $XLK Thats all you need basically.

CRUDE

It was a really good week for crude overall. Even had an Inventory drawdown on the EIA report.
June contract will expire of 19th May. Might be some bumpy road ahead.
Definitely has steam go to to $25.
My view on crude is that the price will remain trapped between a range, probably $15-$25 while the demand issues are not resolved.
I am currently staying away from crude. There´s too much uncertainty for me.

Oanda WTI CFD
TANOS Crude Dashboard

And interesting sector that I am particularly looking into again is tankers.
They took a beating this week. Looking into $STNG, $EURN and $DSSI

GOLD
Nothing much to say, I was wrong on the fundamentals.
The technical breakout was pretty strong.
My setup for long was on the breakout restest with a TTM squeeze buy signal.
The resistance at ~1747 might prove a challenge. The stop is below the support and the TP is – 1770.

Oanda GOLD CFD

That being said, this happened last week:

SP500
The breakdown was clear. It dropped hard without any retest.
What I am looking is that red resistance at 2876. I am looking into short there with a ~5 points stoploss. For TP I don’t have a clear target, will let it ride and manage it but the 0.5 fib zone looks though to break so must be a decent target.
SAR signals also bearish.

Oanda SP500 CFD
Oanda CFD SP500
TANOS SPX Dashboard

STOXX50
Almost a repeat from SP500. The 2970 resistance is providing some nice short opportunities. Tight stoploss of ~5 points and let it ride. TP, the 0.61 fib looks strong so keep an eye on it.

Oanda STOX50 CFD

CAD
It´s going, but the time is not upon us, yet.
As this new crises unfolds the CAD looks really vulnerable.

CAD Daily and Weekly Chart

The CADJPY, TTM Squeeze already triggered a sell signal on the daily and the reject of the 76.54 is a very good signal for shorts.
I am looking a close below structure channel + breakdown on the triangle to enter a short.

CADJPY Daily and Weekly Chart

AUDJPY
I am a little bit to excited with this trade. Technically it looks amazing, too amazing to be true.
I got short at ~70.03. On a short term, it looks like a H&S inside a rising wedge.
I am planning on adding more on the neckline breakdown, below ~67.759.
On a longer timeframe, we have already a huge H&S in play.
This can a be a hell of a trade! That´s making me nervous.

AUDJPY Daily and Monthly Chart

Another Notes

VIX Short term spreads end up bearish

VIX Short Term Spreads

Stocks / Commodities ratio is looking interesting

Stocks / Commodities chart

Natgas, things are getting ugly. Summer is upon us and technically it does looks ugly.

Oanda CFD Natgas

Senators buying selling

https://www.quiverquant.com/sources/senatetrading

Articles:

https://www.topdowncharts.com/single-post/2020/05/12/Broken-Indicators-The-Forward-PE-and-the-PEG

Bank of Japan as a Contrarian Stock Investor: Large-Scale ETF Purchases

Marin Katusa is a a legend on the commodities industry, this interview is very good.

Events:
Monday
JPY – Prelim GDP /Tertiary Industry Activity
GBP – CB Leading Index
USD – NAHB Housing Market Index

Tuesday
JPY – Revised Industrial Production
GBP – Average Earnings Index / Unemployment Rate
EUR – ZEW / German ZEW
CNY – CB Leading Index
AUD – CB Leading Index

Wednesday
JPY – Core machinery Orders
GBP – CPI / Core CPI
EUR – CPI / Core CPI / Consumer Confidence
CAD – CPI

Thursday
AUD – Flash PMI
JPY – Flash PMI
GBP – Flash PMI
USD – Flash PMI / Philly Fed Man. Index / Unemployment Claims


Friday
EUR – Flash PMI
GBP – Retail Sales
CAD – Core retail sales

11 – 15 May 2020 Trading week preparation

The content is now separated between markets/folders I track. It´s easier for me and I hope it´s easier clear for you too.
https://eod-notes.com/shared-content/

From last week:
This last trading weeks have been hard as hell. Last week I got stopped from the only trade I made, short CADJPY.
I believe that in order to improve my trading, I don’t have to be always trading, I am brushing up on my macro. I am reading a lot, better then reading I am trying to understand and puzzle it all together. It´s a time investment.

My open trades still are, long gold, long $AG. I have to confess I have been struggling not to open new trades, my patience to wait for clear signals are reaching an end. I think this market conditions are being hard on all traders.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    Still believe this, this is a never ending bear rally, I almost sound like Nouriel Roubini I know.
  2. US bond yields are going to zero.
    Yes confirming, every single day.
  3. Gold and silver will go a little bit lower before acting as safe heavens.
    I am almost giving up on this idea. technicals for gold and silver look amazing.
    I can totally be wrong on this one.
  4. Commodities will behave like gold, specially grains.
    Grains are getting slammed hard. I believe this will provide buy opportunities for the entire decade. When grains start to pump, they will pump hard, remember patience.
US Yields

Next Week:
I am scratching myself not to short SP500 and Stoxx50.
This Monday we will have the US Mortage Delinquencies number and this will tell a tale of how families are surviving the corona virus. This brings me to a big conundrum, markets have been rallying on really bad news. I will wait for a reversal signals before going short. I will overlay EURAUD on SP500 for more insights, remember, they correlate negatively.

Next Thursday, May14th It´s and OPEX day, prepare for some serious action this week to regarding to this.
More Earnings:
Looking at DDOG, TLRY, CSCO, FTCH, JD, NEWR

11th May Earnings

CRUDE

https://themarketear.com/
TANOS CRUDE Dashboard

The V shape recovery on crude is on the stocks side. Despite the big rally last week, I do believe crude, specially WTI is reaching it´s near term top. Further downside will be in play, specially with the expiration of the June contract on the 19th.

Oanda WTI CFD weekly chart

GOLD
The technical setup for gold looks really interesting, despite being bear on the short term. If this setup plays out, I will have to change my bias.
I still believe that every gold dip should be a buying opportunity. Watch the support at ~1680 or the 30dMR.

Oanda GOLD CFD daily chart

SP500
Only Jerome Powell knows what SP500 will do next.
It´s like trading and asking a magic 8ball for advice.
On the daily, last Friday it rejected the 0.38fib level. Bare in mind that until the trend line is broken, the trend is still up. On the hourly chart, looks like a pullback is eminent. No reversal signals appeared yet.

Oanda SP500 CFD daily
Oanda SP500 CFD hourly
TANOS SPX Dashboard

CAD
I am very bearish on CAD and Canada overall. Vancouver city is bankrupt. Canada economy is looking worse by the day It´s reliability on commodities exports and real estate s troublesome.
How I am playing this, long USDCAD / Short CADJPY and long XAUCAD.
Interesting data from the CoT too, money managers are positions short on the CAD.

Oanda USDCAD daily chart
Oanda CADJPY Weekly chart
TANOS CoT Dashboard

Another Notes

Stocks / Commodities ratio, a big drop last week. It´s the commodities strike back moment?

Stocks/Commodities ratio

VIX Short term spreads turned bullish

VIX Spreads

US stocks volume have been dropping sharply

US stocks volume

Things on sentiment is becoming weirder by the day. AAII Survey is mainly bearish, NAAIM turned bullish, European sentiment is negative overall.

TANOS Sentiment Dashboard

Safe Havens It´s a bag of mixed feelings.

TANOS Safe Havens Dashboard

GBPUSD looks ready to drop hard.

TANOS Minerva systems

I dipped my toe on bitcoin for the first time back in 2017. Sold some at the top but been riding this with up and down with a small part of my portfolio. This is not a bad looking chart.

BTC Daily chart

The last but probably the most important, Insider selling. IF they don’t want their own shares, you shouldn’t want them too. They know Q2 results will be terrible, they are dumping stock left and right.

http://www.openinsider.com/insider-sales

Articles:
https://www.etftrends.com/can-your-etf-go-negative-is-that-possible/


What’s next after the big bounce – Mark Dow joins Alpha Trader

Just discovered this, Its just amazing: https://www.occupyajobonwallstreet.com/

Events:
Monday
USD – Mortage Delinquencies

Tuesday
JPY – Leading Index
USD – NFIB Small Business Index / CPI / Core CPI

Wednesday
JPY – Economic Watchers Sentiment
GBP – Prelim. GDP / Man. Production / Index Services / Industrial Production
EUR – Industrial Production
USD – Core PPI / PPI

Thursday
AUD – Jobs
EUR – German CPI
USD – Unemployment Claims

Friday
CNY – Industrial Production / Retail Sales / Unemployment Rate
EUR – German Prelim. GDP / EUR flash GDP
USD – Core retail sales / retail sales /Empire State Man. Index / industrial Production / UoM Sentiment / Jolts Jobs

Using python and dtale to analyze correlations

I can´t say this enough times, correlations matter and correlations are in deed a traders best friend.

Correlations are very useful but very hard to plot without some code knowledge. Fortunately the guys that made dtale are life savers.
https://github.com/man-group/dtale
dtatle is a library that allows you to manipulate data, you can re-order it, plot it, export it, etc.

Today I will share with you a simple way to plot ETF correlations.
For starters you should go to my shared content and download the spreadsheet with the ETF data, I will update this file at least monthly.
https://eod-notes.com/shared-content/ click on the “Reports” link and download the file.

I will assume you have python installed on your machine.

For starters you need to install dtale

pip install dtale

After dtale is installed you can copy paste this snippet.

import pandas as pd
import dtale

data = pd.read_excel("YOUR_FILE_PATH.xlsx") 
d= dtale.show(data)
d.open_browser()

Replace “YOUR_FILE_PATH.xlsx” with your file path and run it.
You will see something like this.

dtale start up

After this, go to the top left corner and click on the arrow. Select the correlation menu.

dtale correlation menu

A new window will pop up, now you are free to explore. search for specific correlations, change the Rolling Window for a smother data, have fun.

Find more stuff on my github:
https://github.com/tiagolvsantos/eod_notes

If you have any questions or want help to try some strategies up, feel free to drop me a message.

Have an awesome day,

Tiago

4 – 8 May 2020 Trading week preparation

The content is now separated between markets/folders I track. It´s easier for me and I hope it´s easier clear for you too.
https://eod-notes.com/shared-content/

From last week:
Last week I got a question from a friend that I thought I should share.
He asked me why some of my setups don’t happen on the week I talk about them. The answer is simple, I don’t trade daily. I look and weekly charts and monthly charts. I use daily charts for entries. Bigger timeframes give you clear perspectives, daily charts have “noise” from market news and events. That being said, I share assets and trades that I am willing to have open for weeks or months.
Talking trade, last week I didn’t made any trade. I didn’t pull the trigger on long USDCAD and my longs for MSFT and APPL failed the entries on last Thrusday´s dip and I didn’t chase.
CADJPY, AUDJPY and EURAUD are all in the radar since last week.

This week the reports and spreadsheets I usually share are a little different. They have more content and different formats. I have been redoing my frameworks and algos. Taking advantage of the free time and patience and breath I am giving the markets.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    SP500 started to turn red, even with big earnings we closed the week on the red. Maybe It´s a start for a bigger pullback
  2. US bond yields are going to zero.
    Yup, not much to say about this
  3. Gold and silver will go a little bit lower before acting as safe heavens.
    This week a lot of european countries will start to re-open. Let´s see how gold reacts
  4. Commodities will behave like gold, specially grains.
    It´s been a bloodbath lef and right. They will pose great opportunities to long for a patient investor.

Next Week:
Another action packed week of earnings

Earnings 4 May 2020

I will be looking at:
DIS – All parks are closed and I dont think streaming will save DIS this earnings. A big dip may provide a great long opportunity as quarentine is being eased and the return no normal will reopen the parks.
NEM & GOLD – Gold miners, their earnings might tell where gold´s heading next.
SHOP – Shopify earnings may mark the recently top for the stock.
STNG – tankers, Scorpio is a big company. I failed the entry to long tankers. I doubt I will get a nice entry post earnings but It´s on my radar.
UBER & LYFT – This will be bad, It´s just morbid curiosity
BKNG – Booking Holdings, Tourism being stalled everywhere the business for booking sites may be down substantially. Big drops may provide great entries for long term.

I am watching mining stocks for any pullback to key levels.
As said last week, XLE and XLF for any government bailouts.

CRUDE
The puppy is sick, despite of the recent pump, If you look to long term crude is trapped on a massive down turn. We are down 550% $65 in 581 days. This is a big trend. Supply is still greater than demand. Keep your eye on the ball and don’t fomo in. Despite all this, crude may trade to $25 the technicals are there but I think it will only provide a opportunity for shorts. This is the 4th week straight of massive inventory builds despite production cuts.

Oanda WTI CFD
TANOS CRUDE Dashboard

GOLD
Again, long term I am bullish as hell. Short term I fear It will have a pullback. Call it the return to normal pullback. Any touch on the orange box, I am buying.

Oanda GOLD CFD – Weekly
Oanda GOLD CFD – Daily

SP500
Last week earnings pumped SP500 to 2959 in the cash session, to revert south on huge earnings at the en of the week. This was weird, maybe people are catching up to the narrative It´s not only the virus, It´s the impact on the economy. 66% of SP500 are still below the 250 DMA. The 2800 level is heavily disputed. SPX cash rejected 0.38 fib perfectly. This is very important because it rejected it two days in a row.

Oanda SP500 CFD – Daily
TANOS SPX Dashboard
CME QuickStrike
SPX Cash session

YEN
YEN is poised for a massive breakout. I see some vulnerabilities on AUD and CAD vs the YEN. Bare in mind this is long term plays, have patience. This Tuesday RBA will decide rates an acceleration on RBA might help this trade.

JXY Weekly chart
Oanda AUDJPY Weekly
Oanda CADJPY Daily

Another Notes
Insiders are not buying the fed printer again.

Insiders Sentiment

Sentiment still mixed

TANOS Dashbaord Market Sentiment

Safe Havens are starting to gain strength again

TANOS Safe Havens Dashboard

Huge drop on the Weekly Economic Index

Weekly Economic Index – Fred

Articles:
Barrick dispute with Papua New Guinea

A Quantitative Approach to Tactical Asset Allocation – Meb Faber

The Original Quant (guest: Rob Hanna) – Market Huddle Ep.78

Events:
Monday
EUR – MAN. PMI / Sentix Investor Confidence
CHF – MAN. PMI
USD -. Factory orders
AUD – AIG Construction Index

Tuesday
AUD – Rates Decision
USD –Services PMI / ISM NON. MAN PMI
CHF – SECO Climate
GBP – Services PMI

Wednesday
EUR – German factory orders / Services PMI / retail sales
GBP – Construction PMI
AUD – AIG Services Index

Thursday
CNY – Caixin Services PMI
EUR – German Industrial production
USD – Unemployment Claims
CAD – IVEY PMI

Friday
USD – Jobs data
CAD – Jobs data




27 Apr – 1 May 2020 Trading week preparation

The content is now separated between markets/folders I track. It´s easier for me and I hope it´s easier clear for you too.
https://eod-notes.com/shared-content/

From last week:
I been trading less and risking less.
I closed my position on $GOLD (Barrick Gold) for + ~36% the last Thursdays candle looked toppy. I will look to go back in on a pullback.
I also closed my USDCAD short, when price failed to close above 1.42489 it was my hint. USDCAD will go higher but profits are profits. I am looking to take another long on a new retest of 1.40062.

Positions on $AG, $XAUUSD (longs) are still open.
I have been using a lot of time refactoring and creating new frameworks for my algos. Despite not being trading much, I am using this time to learn new strategies, code, backtest and study macro.
Maybe next week I will have more free content to share.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    This is being hard to digest, market rumors and the Fed are pumping this market up. I stand by my opinion, patience is a virtue.
  2. US bond yields are going to zero.
    Yup, not much to say about this
  3. Gold and silver will go a little bit lower before acting as safe heavens.
    This is a curve ball, Gold is pumping, JPY is setting up nicely for a pump too but Silver and CHF and looking really weak.
  4. Commodities will behave like gold, specially grains.
    CRB Index reached a new ATH low
CRB Commodity Index

Next Week:
Another action packed week of earnings

Earnings Week 27 April 2020

So far earnings have been very disappointing.

Earnings beating consensus – https://themarketear.com/posts/c84QLsijZo

I will be looking into MSFT, APPL, V, FB ,BA, LUV and AMD.
Two special notes for this week:
1- Airlines, earnings should be very, very bad. They will probably be subject to government bailouts. For the long term this downside should be excellent buying opportunities.
2- Oil companies. Mnuchin already said that the US is looking into taking a stake on oil companies as a bailout mechanism. XLE biggest companies as % are XOM and CVX. When this pumps be ready and don´t miss the boat.
As oil is being bailed out, XLF and banks will ride that wave too because they are the most exposed to debt (HYG and JNK), be aware to surf that wave too.

CRUDE
I wouldn’t touch crude directly with a two foot pole, the volatility and uncertainty will eat your trade alive.
It´s rumored that new OPEC + talks will happen and Trump is committed to stop the oil bleeding too.
Crude spreads are going nuts, and Brent shines as more stable than WTI.
If you want to play long/short crude be aware of volatility or use correlated assets with lower volatility.

TANOS WTI

GOLD
Not much to say, I still believe in a short term pullback but long term I am very bullish. Some people are seeing a IH&S being formed, but without a breakout my bias maintains.

Daily XAUUSD chart

SP500
Probably this earnings week will decide the fate of SP500.
It´s been trading in a range and the technical setup supports a bearish bias.
Some of the index constituents are starting to turn red. SPY outflows YTD continue.

SP500 Daily chart
TANOS SPX
SPY Outflows

YEN/ CAD
Yen is position to pump hard, on the monthly chart is already squeezing a screaming buy. On the other hand, CAD looks ready to die. Great way to play this is CADJPY.

Monthly YEN
Monthly CAD

Another Notes
Insiders are not buying the fed printer trigger, and buybacks are at the lows. If execs are reaching for life boats, they should know what´s what.

Insiders transactions
Insiders selling by index

Sentiment is mixed, confusion reigns in the market

TANOS Sentiment

Safe Havens are also mixed

TANOS Safe Havens

Articles:
WSJ Article on crude storage
Visual Capitalist info chart about dividend investing on volatile markets

Events:
Monday
EUR – German Retail Sales m/m

Tuesday
JPY – Unemployment rate / Core CPI
USD – Consumer Confidence / Richmond Man. Index

Wednesday
USD – Advaned GDP / FOMC
AUD – CPI

Thursday
JPY – Retail sales / Consumer Confidence
CNY – MAN. PMI / NON MAN. PMI
CHF – KOF Economic Sentiment
EUR – German Unemployment / CPI / Core CPI / EUR Unemployment Rate
USD – Unemployment Claims / Chicago PMI

Friday
JPY – Man. PMI
CHF – Man. PMI
GBP – Man. PMI
CAD – Man. PMI
USD – Man. PMI
EUR – Bank Holiday




19 – 24 Apr 2020 Trading week preparation

The content is now separated between markets/folders I track. It´s easier for me and I hope it´s easier clear for you too.
https://eod-notes.com/shared-content/

From last week:
Last week I only took a trade. Short USDCAD.
Here is my thesis. USDCAD correlates negatively with WTI. I am bearish crude but I will explain why on the Crude section.

Correlations between USDCAD and WTI

CAD technically and fundamentally looks very weak. Canada´s economy is falling into shambles and the CAD relies on crude prices to be stable.

CAD Currency Weekly chart

It was a crazy week overall, sadly the corona virus situation isn’t improving.
Markets are still rallying acting as everything is fine. This is insane.

My macro opinions for long term:

  1. We are heading lower, much lower on stocks.
    This week bulls swing for the fences, the SP500 rallying but is inside a rising wedge, maybe a retest of ~2900 is possible because Its the YTD mean reversion.
    Still believe we are heading much lower.
  2. US bond yields are going to zero.
    Shorter terms are already negative.
US Gov Bond Yields

3. Gold and silver will go a little bit lower before acting as safe heavens.
Gold corrected lower last Friday. News on stability and GILD treatment relived market sentiment. When everything stabilizes for good, old will correct much lower.
4. Commodities will behave like gold, specially grains.
Grains started to suffer, corn is already reaching 52W low price per bushel.

Next Week:
I don´t believe It´s time to go long.I am mostly in cash with four trades open, long gold, long $GOLD(Barrick Gold), long $AG and short USDCAD.
At the same time, I don’t believe It´s time to short the market, SP500 is showing a lot of power. We need to have a reversal event in order to trigger shorts.
I will keep watching the FX market for plays. Special note to grains and natgas, Corn is almost at a 52W low price per bushel, It might be worth a shot. Natgas ripped but is still inside a falling wedge, pay attention to a possible breakout.

Earnings season is steaming up ahead. Online companies will do good, home delivery services will do OK, everything else will do poorly. If you play earnings, be safe out there. It´s going to be a roller coaster.

Earnings week 19 April 2020

CRUDE
Oil markets are absolutely insane. Futures curve are in a super contango.

Oil futures contango – https://themarketear.com/

This is not enough to drive oil prices up. The supply is much bigger than the demand and while this doesn’t change, the price should go down. Even with massive OPEC+ cuts and Trump saying he will pay producers to not produce, the oil prices are driven by supply / demand laws.
Last Friday crude closed below the trend line and below support,It looks bad.

Oanda CFD WTI weekly chart
TANOS Market Gauge Crude

This is not all bad, in shore storage is reaching it´s capacity limit, so off shore storage is being contracted. BDI index is starting to turn positive and some tanker stocks are printing big green candles. I am not playing this, I arrived late to the party. If a new pullback happens I will look into it.

Baltic Dry Index

GOLD
Long term, I am very bullish gold, that´s why I am long from the base ~13xx level. This being said, Short term I believe gold prices will catch up with reality once the supply chain issues are resolved.

Gold monthly chart

The orange box on this chart is the level I am looking into adding to my gold bags.

Gold Daily chart
TANOS Market Gauge – Gold

SP500
Still inside a rising wedge. A new leg up to test the YTD mean reversion at ~2900 is still possible before rolling over. There´s the space and momentum for a last push higher.

Oanda SP500 Daily chart
Oanda SP500 Cloud chart
TANOS Market Gauge SP500

Another Notes
Insiders are not buying the fed printer trigger, and buybacks are at the lows.

Insiders transactions
https://themarketear.com/
https://themarketear.com/

Sentiment is still mostly bearish but the market keeps rallying, some people call it a bear market rally, others are saying the bottom is in. Pick a side.

TANOS Market Gauge Sentiment

Nasdaq is being the top performer, Tech is ripping on this bounce. When and If a sell off happens this stocks may provide great buying opportunities.

TANOS Market Gauge NASDAQ Perfs

Events:
Monday
EUR – German PPI
CAD – Wholesales m/m

Tuesday
GBP – Avg. Earnings Index / Unemployment rate
EUR – German ZEW Economic Sentiment / ZEW Economic Sentiment
CAD – Core retail sales / Retail sales
USD – Existing home sales

Wednesday
GBP – CPI / CORE CPI / PPI
CAD – CPI
CNY – CB Leading Index
EUR – Consumer Confidence

Thursday
AUD – Flash PMIs
JPY – Flash Man. PMI
EUR – Flash PMIs / German GFK Consumer Sentiment
GBP – Flash PMIs
USD – Flash PMIs / Unemployment claims

Friday
GBP – GFK Consumer Confidence / Retail Sales
EUR – German IFO
USD – Durable Goods / UoM Consumer Sentiment