Quarterly Outlook
Macro outlook: Trump 2.0: Can the US have its cake and eat it, too?
John J. Hardy
Global Head of Macro Strategy
Global Macro Strategist
Summary: This week starts with equities rallying out of the gates on the euphoria of "Phase One" partial deal completion in the works between the US and China. Love it or hate it, believe or disbelieve it - respect the price action, our roles are to make money consistently over time. We could see a squeeze higher in risk-on assets and a pullback in risk-off assets over the near team.
2019-Oct-14
A replay of the call is available HERE
TGIM & Happy Macro Monday everyone, welcome to WK 42
Regardless of whether you believe Trump that a partial deal is in the wraps, one must respect the potential price action & potential squeeze higher on risk-on assets, as well as pullback on risk-off assets.
In particular, areas that have lagged such as energy & biotech etfs on XLE & IBB, Kospi & Hang Seng indexes & of course the agri complex, could grind up much higher for quite a few sessions – alongside a USDCNH 7.08, which could go back to test the 7.00 level.
On the other end gold, silver & the precious metals complex (etfs, single stock names, etc) could see some serious pressure lower over the next few trading sessions. Especially if we continue to have another big move up in US yields (i.e. we’ve gone from c. 1.53% to +1.73% in a wk on USTs), USDJPY 108.31 & USDCHF 0.9961 could continue to climb. The former looks that much interesting as previously these 108.50 / 109.00 area has been key resistance area for DollarYen traders.
Wishing everyone a healthy, phenomenal, smooth, profitable & bell-curve setting start to the 4Q!
Namaste
-KVP
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Summary of Prior Week:
COT Report: [@Ole_S_Hansen]
Week Ahead
Key Focus:
Central Banks (SGT):
FOMC Speakers (SGT):
Other (SGT):
Econ Data:
Potential Implications of “Phase One” Market Reaction: Near-Term Tactical view
Chartography & Price Action