IB Traders Insight


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Macro

GUOSEN Closing Bell (July.27)


MARKET

Chinese stocks closed lower today, with the benchmark Shanghai Composite Index ended at 2992.0 points. The A share market tumbled amid tightened financial regulations; Beijing sent a strong message with intention to push liquidity into industry and commerce, investors panicked in response. Bank sectors led the gains; while computer and communication sectors led the falls. Combined turnover for both markets was 806.8 bn yuan, up 66.3% dod.

 

CLOSE

%CHG

VOL (bn yuan)

%YTD

SH Composite

2992.0

-1.91

316.8

-15.46

SZ Component

10405.85

-4.11

490.0

-17.84

CSI300

3218.24

-1.57

124.4

-13.74

ChiNext

2155.39

-5.45

136.7

-20.58

 

Sector

Top 1

Led by

Top 2

Led by

Upward-leading

Bank

601328

 

 

Downward-leading

Computer

300386

Communication

300134

 

NEWS

*Chinese investors pumped $17 billion into overseas property investment during the first five months, becoming the world's second-largest source of outbound property investment. The United States retained its top spot with $19 billion, according to a report released by DTZ/Cushman & Wakefield, a global leader in commercial real estate services. Outbound Investment continued its rapid growth in China, the report said. The total outbound investment from January to May this year has accounted for the 65.6 percent of the total investment of 2015. (China Daily)

*China's gold production rose by 0.16 percent year on year to 229 tons in the first half of 2016, while consumption declined 7.68 percent to 529 tons. The majority - 341 tonnes - of consumption went on jewelry, according to the China Gold Association on Tuesday. (Xinhua)

 

 FUND FLOW

Click here for more information about Guosen.

This article is from Guosen Securities Co., Ltd. and is being posted with Guosen Securities Co., Ltd.’s permission. The views expressed in this article are solely those of the author and/or Guosen Securities Co., Ltd. and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


10324




Macro

European Market Outlook: Asia sees risk on trade on Y27 stimulus, FOMC in focus


Morning Briefing July 27th 2016


There is a full calendar on both sides of the Atlantic Wednesday, with UK GDP an early highlight. However, the Fed's policy decision, expected at 1800GMT, will be the highlight of the day.


The European calendar gets underway at 0600GMT, when the German import/export index is published, along with the German GFK consumer climate index.


At 0645GMT, the French consumer sentiment data and the French June PPI data will cross the wires. Spanish June retail sales will be published at 0700GMT.


The ECB will publish the latest EMU M3 money supply data at 0800GMT. At the same time, Italy's ISTAT will release the latest Business and Consumer Confidence data.


The UK data gets underway from 0830GMT, when the index of services and the Q2 GDP data are published. GDP had been experiencing positive growth in Q4 2015 and Q1 2016, and the Q2 2016 forecasts are on par with the previous growth.


The GDP estimates for Q2 appear fairly positive given the uncertainty ahead of the UK vote to leave the EU. This is mainly because of the solid economic performance in April and May.


Many analysts believe it unlikely that the UK will experience similar growth in Q3 due to the Brexit vote.


The index of services, however, seems to have suffered in comparison to the prior value of 0.6% (MoM), as the forecast high is only at 0.4% and the low is at -0.2%.


At 1000GMT, the UK CBI Distributive Trades data will cross the wires.


Across the Atlantic, the calendar gets underway at 1100GMT, when the MBA weekly applications index will be published.
The June durable goods new orders data will be released at 1230GMT.


Durable goods orders are expected to fall by 1.7% in June after a 2.3% drop in May, with transportation falling further. Boeing reported only 12 new orders in June, down sharply from 125 in May, so analysts look for a decline in new orders for aircraft. Durable goods orders ex-transportation are expected to post a very modest 0.1% increase after a 0.3% drop in the previous month.


The latest building permits revisions and NAR pending home sales data will be released at 1400GMT. The latest DOE weekly crude oil stocks will be published.


The main event of the day comes at 1800GMT, when the FOMC policy announcement crosses the wire.


Despite the better US data recently, the Federal Reserve will likely not raise its short term policy rate at this meeting.

Instead, they will continue to favor patience, while keeping their options on the table for upcoming meetings.


Even at the June meeting, the minutes showed, voting FOMC members "judged it appropriate to continue to leave their policy options open.

 

Global Economic Trading Calendar


 

Markets


FOREX: Yen weakness was the main theme in the Asia-Pacific region as news hit the wires that the Japanese stimulus would be in the regional of Y27 trillion, at the upper side of recent expectations. Dollar-yen was bid from the open, rising from Y104.63 to Y105.23 and then exploded to Y106.54 as the stimulus news hit the streets. Aussie-dollar traded in a narrow $0.7500 to $0.7529 ahead of the local CPI data, post data saw spike to $0.7566, the move proved short-lived the pair trading back to pre-data levels of $0.7510 a little while after. US Dollar strength was then the main feature as the stimulus news hit, the aussie dropping quickly to a session low of $0.7458 before recovering. Aussie-dollar was last at $0.7480. Meanwhile, euro-dollar was again subdued, carving out at $1.0982 to $1.1001 range, supported mildly from cross flow (euro-yen) and was last at $1.0998.

US INDEX FUTURES: US stock index futures are trading with a bid tone on the back of a higher Nikkei, with Apple's better-than-expected results giving its Asian suppliers a boost in Asian trade. Currently the Sep'16 e-mini S&P futures are trading up 3.50 points at 2,166.75, the Sep'16 e-mini Nasdaq futures are trading up 30.00 points at 4,693.75, while the Sep'16 e-mini Dow futures are trading up 33 pints at 18,431.

US STOCKS: After selling off earlier on talk of program selling, US stocks rebounded in afternoon action Tuesday, but remain mixed in the final hour of trading. The DJIA is down 0.17% at 18,461, the Nasdaq Composite is up 0.20% at 5,107 and the S&P 500 is down 0.02% at 2,168.

US TSYS: Treasures have eased on news from FNN that Japan is planning fiscal stimulus totaling some Y27 trln, at the upper end of expectations, with plans also to issue 50yr JGB to finance it the WSJ reports. Cash 10's are now some 2.1bp richer, while 10yr futures are down some 6-ticks from the close. Volumes have picked up with 10yr futures trading more than 55k and cash some ~$4.2 bln. Ten year futures now down 5.5 at 131-30.

JAPAN STOCKS: A weaker Yen on the prospects of further BOJ easing, has seen Japanese stocks overcome their losses on Tuesday on lower than expected stimulus from the Abe administration and poste decent gains. Also Apple suppliers have also given the market a lift after the tech giant released better-than-expected earnings after the market closed on Tuesday. The Nikkei has closed for lunch up 1.39% or 227.15 points at 1,610.19, while the Topix is up 0.71% or 9.27 points at 1,316.21.

GOLD: Spot gold is last down $1.10 at $1,319.10 per ounce, in a $1,320.60 to $1,316.55 range so far this morning in Asia, with the market showing resilience as the US Dollar regained ground against the Yen, ahead of the FOMC later today. Commerzbank notes that "gold also faced headwind from ETF investors yesterday: the gold ETFs tracked by Bloomberg recorded outflows of 4.5 tons - their highest in two weeks - which were exclusively attributable to the SPDR Gold Trust". Also they note that Chinese gold demand declined by 7.7% to 528.5 tons in the first half yearciting the China Gold Association.

OIL: WTI crude oil futures for Sep'16 delivery last down $0.04 at $42.89 per barrel, after a $42.96 to $42.60 range in Asia today, with the market posting multi-month lows during Tuesday trade. Commerzbank notes that "concerns about an oversupply were exacerbated by figures from Genscape which suggest that crude oil stocks at Cushing climbed by a good 1 million barrels last week". According to a Bloomberg survey, the market is expecting an inventory reduction of 300,000 barrels. The API will be publishing its figures after close of trading this evening, with the US Department of Energy to follow suit tomorrow afternoon. Key support for crude is seen at 41.88 and then the 200-day moving average at $40.76, while a move above $46 is needed to stabilize the technical outlook.

 

Technical Analysis


BUND TECHS: (U16) 166.37/166.42 To Hold For Gains To Continue


*RES 4: 167.54 76.4% Fibo of 168.13-165.63
*RES 3: 167.37 Jul 13 high
*RES 2: 167.17 Jul 14 high, 61.8% of 168.13-165.63
*RES 1: 167.03 Jul 26 high

*PREVIOUS CLOSE: 166.64
                                   
*SUP 1: 166.37/42 Hourly support, Jul 26 low
*SUP 2: 166.16 Jul 25 low
*SUP 3: 166.01 Jul 22 low
*SUP 4: 165.63 Jul 21 low

*COMMENTARY* Continues its recovery following last week's dip to 165.63, which kept us above the post Brexit low at 165.51. The move above 166.87 on Tuesday is encouraging, this can lead to the chance of a greater correction of the losses seen since the Jun 24 high at 168.86. Above Tuesday's 167.03 high and there is 167.17/167.54 potential. Meanwhile, the initial support now comes from between166.37/167.42. Ideally this holds if gains to continue at this stage.

 

EUROSTOXX50 TECHS: Above 2983.0 Needed To Resurrect Upside Interest

*RES 4: 3089.0 May 31 high
*RES 3: 3058.0 Jun 23 high
*RES 2: 2994.0 Jul 25 high
*RES 1: 2983.0 Hourly resistance

*PREVIOUS CLOSE: 2975.0
 
*SUP 1: 2939.0 Jul 22 low
*SUP 2: 2924.0 76.4% Fibo of 2903.0-2994.0
*SUP 3: 2903.0 Jul 19 low
*SUP 4: 2899.0 Jun 30 high, now support

*COMMENTARY* Monday saw an attempt to regain ground above dual resistance at 2988.00. As well as a 76.4% Fibo retrace of the 3088.0-2645.0 losses sustained since mid-April, this was also an equality rise target from Jul 6 low at 2734.0.
A high of 2994.0 seen before closing at the lower 2965.0 level. In the interim, any setback sees support from between 2939.0-2924.0. The latter now needing to hold to avoid any deeper correction. Back above 2983.0 would assist now.

 

Eurex Futures Market Close


 

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This article is from Eurex Exchange and is being posted with Eurex Exchange’s permission. The views expressed in this article are solely those of the author and/or Eurex Exchange and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


10323




Technical Analysis

EURUSD Testing Key 1.1 Level Ahead of FOMC


The EURUSD edged slightly lower yesterday, forming a daily Tombstone around the psychologically key 1.1 level.  With the FOMC today at 2pm EST, the EURUSD isn't likely to feature overly big moves before that, but certainly warrants watching for a breakout above downchannel/descending wedge resistance (on the 4hr chart) after 2pm EST.  Daily and 4hr RSI, Stochastics and MACD are bottomish, consolidating recent gains or rallying, suggesting a bullish bias for today.  Looking ahead to the next few days, things are less certain as the weekly MACD still slopes down, hinting that any bounce today post-FOMC could be shortlived.  I am long at 1.099 as of today's Asian morning and will target 1.102 ahead of the FOMC, closing the long regardless of whether it hits that level before the volatility spike post-FOMC.

 

EURUSD Weekly/Daily/4hr/Hourly

 

Click here for today's technical analysis on AUDUSD, VIX

 

Tradable Patterns was launched to demonstrate that the patterns recurring in liquid futures, spot FX and equity CFD markets can be traded consistently profitably. Tradable Patterns’ daily newsletter (blog) provides technical analysis on a subset of ten to twelve CME/ICE/Eurex futures (commodities, equity indices, interest rates), spot FX and US equity markets, which it considers worth monitoring for the day/week for trend reversal or continuation. For less experienced traders, tutorials and workshops are offered online and throughout Southeast Asia.

 

This article is from Tradable Patterns and is being posted with Tradable Patterns’ permission. The views expressed in this article are solely those of the author and/or Tradable Patterns and IB is not endorsing or recommending any investment or trading discussed in the article. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


10322




Options

What's Trading: AAPL


CBOETV – Kevin Davitt, Senior Instructor, CBOE Options Institute, breaks down a strangle trade ahead of AAPL earnings. 

 

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, a person must receive a copy of Characteristics and Risks of Standardized Options. Copies are available from your broker, or at www.theocc.com. The information in this program is provided solely for general education and information purposes. No statement within the program should be construed as a recommendation to buy or sell a security or to provide investment advice. The opinions expressed in this program are solely the opinions of the participants, and do not necessarily reflect the opinions of CBOE or any of its subsidiaries or affiliates. You agree that under no circumstances will CBOE or its affiliates, or their respective directors, officers, trading permit holders, employees, and agents, be liable for any loss or damage caused by your reliance on information obtained from the program.

Copyright © 2016 Chicago Board Options Exchange, Incorporated.   All rights reserved.

 

This video is from CBOE and is being posted with CBOE’s permission. The views expressed in this article are solely those of the author and/or CBOE and IB is not endorsing or recommending any investment or trading discussed in the article. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


10321




Securities Lending

SLB Update: Largest Short Value per Sector


The following table shows the securities with the largest short value per sector on 7/22/2016.

The analysis in this article is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


10319




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