Highlights

State of The Markets

Author: MFMTeam   |   Latest post: Wed, 18 May 2022, 9:23 AM

 

Stocks Rebound As The Dollar Falls

Author: MFMTeam   |  Publish date: Wed, 18 May 2022, 9:23 AM


STATE OF THE MARKETS

Stocks rebound as the Dollar falls. US stocks climbed higher on Tuesday after news of better economic data helped bidders scooped oversold growth and tech stocks. Dow (+1.34%), S&P (+2.02%) and Nasdaq (+2.76%), including Russell (+3.19%) closed in the green as Dollar was sold off amid profit taking from long term buyers. The Dollar index closed around the 103.30 mark while the 10Y yield rebounded to 2.99% as demand fell after Fed’s Kashkari gave aggressive remarks on rate hikes.

In the commodities market, crude edged lower on profit taking, but remained well bid above $110.60/bl as New York closed. Gold pared earlier gains to close below $1,815/oz as investors continue to bid Dollar on higher rates expectation. Elsewhere, iron ore retreated to $132.60/tn as investors continue to weigh the demand recovery from China.

In the FX space, demand for Sterling spiked in the short and medium term accounts as speculation ran high that BoE had to hike more to contain inflation. Overall sentiments turned bullish as demand for safe haven Swiss, Yen and Dollar retreated, though Dollar remained King in long term demand.

On Wednesday, markets are expected to remain cautious while looking forward to earning reports from Lowe’s (LOW), Target (TGT), Analog Devices (ADI), Progressive (PGR), Cisco (CSCO), Bath & Body Works (BBWI), Synopsys (SNPS and ZIM Shipping (ZIM) as well as the latest figures in US housing starts and permits. EIA petroleum status will be in the spotlight for energy traders.

OUR PICK – AUD/CHF

On short term rebound. Oversold commodity currencies are being picked up on higher interest rate expectations from global central banks as sentiments turned bullish. Update stop to 0.6970 as TP1 reached.

For more high probability picks, please use our Trading Central services. 

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Stocks Remain Under Pressure

Author: MFMTeam   |  Publish date: Tue, 17 May 2022, 9:19 AM


STATE OF THE MARKETS

Stocks remain under pressure. US stocks closed mixed on Monday after a heavy sell-off for the last seven weeks as Fed geared up for more rate hikes to rein inflation. Nasdaq (-1.20%), S&P (-0.39%) and Russell (-0.52%) closed in the red, while Dow (+0.08%) eked minor gains as yields tumbled on bond demands, with the 10Y benchmark was flat at 2.89%. Dollar was under profit taking, with the index continuing to fall for the third day, breaking 103.50 at writing.

In the commodities market, crude continues to climb amid growing demand as Europe gears to phase out Russian’s oil. The black gold is firm at $112.80/bl as London breaks for lunch on Tuesday. Dollar weakness sent gold higher to $1,833.50/oz while iron ore remains in bids at $133/tn as markets expect demand recovery from China.

In the FX space, short term traders were quick to bid the oversold comdolls trio higher as Dollar, Swiss and Yen retreated to offers. Medium and long term accounts seemed cautious as Yen and Dollar remained in demand, alongside Loonie, Sterling and Euro.

On Tuesday, markets are expected to remain cautious while looking forward to earning reports from Walmart (WMT), Home Depot (HD), JD.com (JD), Weibo (WB) and Trip.com (TCOM) as well as the latest figures in US retail sales, industrial production, business inventories and housing market index.

OUR PICK – No New Picks

We decided to stay on the sideline. Given higher uncertainties at this point in time, we decide to stay on the sideline for now.

For high probability picks, please use our Trading Central services. 

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

 

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Stocks Mixed With Positive Breadth

Author: MFMTeam   |  Publish date: Fri, 13 May 2022, 8:12 AM


STATE OF THE MARKETS

Stocks mixed with positive breadth. US stocks closed mixed on Thursday, after news of April PPI that spiked more than expected (11% vs 10.7%) fueling worries that inflation is yet to peak. Nasdaq (+0.06%) and Russell (+1.24%) eked some gains while Dow (-0.33%) and S&P (-0.13%) edged lower as the Dollar index remained bid above the 104.70 mark. Flows to safety remains high, with bond yields continuing to slide lower, as the inversion between 7Y (2.88%) and 10Y (2.86%) remains.

In the commodities market, crude continued its upward trajectory after news of OPEC+ missed production target and settled around $105.05/bl as New York closed. Gold remained under pressure and closed below $1,821.60/oz as markets expect higher rates from Feds. Elsewhere, global growth concerns continue to weigh on iron ore and the commodity fell to deeper support around $132/tn.

In the FX space, short and medium term traders took advantage of the oversold Sterling to bid while sending more Swiss to offers. Long term investors seem more bearish as Yen advanced further alongside Dollar in demand, surpassing Loonie and Euro.

On Friday, markets continue to weigh the war in Ukraine while looking forward to seeing earning reports from Consolidated Water (CWCO), ProPhase Labs (PRPH), Honest Company (HNST), PLx Pharma (PLXP), ReWalk Robotics (RWLK) and AirSculpt Tech (AIRS) as well as the latest figures in US import/export prices and consumer sentiment.

OUR PICK – No New Pick

No new pick going into the weekend. There is no doubt that long term investors are cashing out in recent market rout as this week pointed to another outflow across the board. $6.4b out of equity, $6.7b out of taxable bonds and $5.8b out of money markets drove cash demand higher than usual and set the Dollar index at the highest since December 2002. At some point, this cash will be deployed, and we believe commodities/commodities related stocks will be among the top inflows.

Trades updates: 

Equities: AUY (20% undervalued, 2.45% yields) was stopped out. We remain bullish CTRA (COG) (23% undervalued, 2.06% yields) and maintained target at $35.30, T (20% undervalued, 5.63% yields), VIPS (38% undervalued with 4.78 z-score) remained well bid after UBS maintain neutral rating but reduced target by 10 cents, CRON (22% undervalued with 27.69 z-score), WBA (28% undervalued, 4.43% yields) had pulled back further to $42 and we remained bullish, and M (45% undervalued, 2.97% yields).

FX & Commodities: Silver is yet to find its bottom and Crude was stopped out.

For more high probability picks, please use our Trading Central services. You could also join us at MFM’s TradeCopy

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Dollar Rose Amid Safe-Haven Flows

Author: MFMTeam   |  Publish date: Thu, 12 May 2022, 8:47 AM


STATE OF THE MARKETS

Dollar rose amid safe-haven flows. While US stocks closed in the negative on Wednesday, The Dollar index continued to rise after reports of hotter than expected inflation (8.3% vs 8.1%). Dow (-1.02%), S&P (-1.65%), and Nasdaq (-3.18%) including Russell (-2.48%) tumbled further amid fears over more rate hikes.

The Dollar index closed above the 104 handle and surged to 104.60 at writing as yields continue to fall amid higher than usual bond demand. The inversion remains between the 7Y (2.95%) and 10Y (2.92%) signaling a fear of recession.

In the commodities market, despite Dollar strength and increased in inventories, crude rebounded and closed above $104.15/bl after news of reduced flow to Europe and Russia’s sanctions on some European gas companies. Gold struggled to close above $1,852.20/oz as Dollar strength continued to weigh on the metal. Elsewhere, technical traders bid the oversold iron ore to close the commodity higher around $134.25/tn as New York closed.

In the FX space, sentiments are more bearish as Yen and Dollar reign in the front of demand in the short and medium term accounts. Long term sentiments were unchanged.

On Thursday, markets continue to look for new development of European sanctions on Russia, while waiting for earnings reports from Motorola (MSI), US Foods (USFD), Brookfield Asset Management (BAM), Constellation Energy (CEG), Nice Ltd (NICE), WeWork (WE) and Algonquin Power & Utilities (AQN) as well as the latest US jobless claims and PPI final demand.

OUR PICK – No New Pick

We decided to stay on the sideline. Given higher than usual volatility right now, we decided to stay on the sideline.

For more high probability picks, please use our Trading Central services. You could also join us at MFM’s TradeCopy

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

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Stocks Mixed Amid Falling Yields

Author: MFMTeam   |  Publish date: Wed, 11 May 2022, 8:34 AM


STATE OF THE MARKETS

Stocks mixed amid falling yields. US stocks closed mixed on Tuesday as safe-haven flows to bonds continue, sending yields lower ahead of the inflation data on Wednesday. S&P (+0.25%) and Nasdaq (+0.98%) edged higher while Russell (-0.02%) and Dow (-0.26%) tumbled further as investors flocked to bonds for safety. As at writing, the 10Y (2.94%) yield is back below 3%, while inversion with the 7Y (2.95%) remains.

In the commodities market, crude slid further on news of delay in European ban of Russian oil and the black gold settled around $98.30/bl as New York closed. Similarly, gold dived deeper into support as demand for yields bearing assets returned and the non-interest bearing metal settled around $1,838/oz. Elsewhere, iron ore tumbled further to $131.90/tn amid demand concerns from China renewed lockdowns.

In the FX space, sentiments are more bearish as Yen advanced further in the long term demand territories while keeping the reign in the short and medium term accounts. Aussie and Kiwi were sent to the back burner across all horizons.

On Wednesday, markets seemed less optimistic about the peace talks but look forward to seeing earning reports from Disney (DIS), Alibaba (BABA), Beyond Meat (BYND), Dillard’s (DDS), Rivian Auto (RIVN), Perrigo (PRGO), and Amdocs (DOX) as well as the latest figures on US inflation. EIA petroleum status reports will  be in the spotlight for energy traders.

OUR PICK – No New Pick

We decided to stay on the sideline. Given higher than usual volatility right now, we decided to stay on the sideline.

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

 

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Stocks’ Rout Continues As Safe-Havens Kick In

Author: MFMTeam   |  Publish date: Tue, 10 May 2022, 8:38 AM


STATE OF THE MARKETS

Stocks’ rout continues as safe-havens kick in. US stocks continue to be sold on Monday after news of China slowdown gripped the market amid fear of a coming recession in the US and Europe. Nasdaq (-4.29%) was the worst hit, followed by Russell (-4.21%), S&P (-3.20%) and Dow (-1.99%). Safe-haven’s demand was high after bond yields reached multi-years highs, with the 10Y benchmark hitting 3.02% for the first time since November 2018. As at writing, inversion remains between the 7Y (3.04%) and 10Y (3.03%) by a basis point.

In the commodities market, China slowdown news dragged crude lower to close below $101.30/bl while gold lost bids as yields struck higher and the non-interest bearing metal settled around $1,853.80/oz as New York closed. Elsewhere, similar fate hit iron ore as the commodity reeled lower to $133.30/tn amid safe-haven flows.

In the FX space, demand for King Dollar pulled back in favor Yen, Euro and Sterling as Aussie and Kiwi were offered in the long term. Overall Sentiments were evidently bearish as the CNN fear and greed index fell to 20 from 32 last Thursday.

On Tuesday, markets are expected to be more cautious while looking forward to earning reports from Trade Desk (TTD), Coinbase (COIN), Occidental Petroleum (OXY), H&R Block (HRB), Electronics Arts (EA), Sony Group (SONY), Gladstone Land (LAND) and Unity Software (U) as well as the latest US small business index.

OUR PICK – Crude

Medium-term pullback, but risk for deeper correction remains. Crude slipped lower after news of China slowdown that would affect global demand, Saudi’s Aramco slashed price for June delivery and Hungary’s objection to EU ban on Russian’s oil. However, news reported that the US plans for a buyback in Q3 to replenish its SPR reserves. Technically, crude is at an uptrend channel after a long term break-out and this is a medium term pullback. However, risk for deeper correction remains.

Risk Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

 

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