Weekly Fundamentals and COT Report

Posted On 26 Sep 2015
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A relatively quiet week for the currencies we follow. Most activity and volatility was in the indices and commodities with the former suffering and the latter benefiting.

How quickly the months fly by! This week is once again the week with the first Friday of the month and therefore the much awaited NonFarm Payroll number.
There is also a good cross section of data for our currencies with the exception of the Euro for which there is precisely none.

USD: A very busy week for the USD.

On Monday the FOMC Member Dudley speaks.
Tuesday we have Consumer Confidence expected at 96.2 down from the previous 101.5.
On Wednesday we have the ADP NonFarm Employment Change figure expected at 191,000 virtually unchanged from the previous month’s figure of 190,000. This excludes both farm workers and government employment.
FED Chairperson Yellen also speaks.
On Thursday we have the customary Unemployment Claims thought to be 273,000 better than last months 267,000 pre revision. This is followed by manufacturing PMI expected at 50.8 down from last month’s figure of 51.1.
Friday is the big day with Average Hourly Earnings expected to show a rise of 0.2% from last month’s 0.3%, NonFarm Payroll at 202,000 up from last month’s 173,000 and the Unemployment rate static at 5.1%.COT data shows that large commercials decreased their net short position in the US$ Index from 59,722 to 46,316. We maintain our position of SLIGHTLY BEARISH.

EURO: There is nothing of note for the Euro this week.

COT data for the Euro shows that large commercials very slightly reduced their net long position from 108,445 to 102,410. We maintain our position of SLIGHTLY BULLISH.GBP: Only three newsworthy items.

On Wednesday we have the Current Account number expected to be negative 22.3Bn down from the previous month’s minus 26.5Bn.
On Thursday we have Manufacturing PMI expected at 51.3 slightly lower than last month’s 51.5.
Finally on Friday we have Construction PMI anticipated at 57.5 versus 57.3.COT data for GDP shows that large commercials increased their net long position from 30,908 to 13,699. We therefore amend our stance from BULLISH to NEUTRAL.YEN: On Tuesday we have Retail Sales thought to be 1.3% down from the previous 1.8%. This is a big drop.

On Wednesday we have the Tankan manufacturing Index and the Tankan Non-Manufacturing Index. The former is predicted to be 13 down from 15 and the latter 21 down from 23. Both are very negative.COT data shows that large commercials increased their net long position from 21,102 to 39,559. We therefore amend our stance from BEARISH to NEUTRAL.AUD: Two items for the AUD.

On Tuesday we see Building Approvals thought to be a negative 1.9% from last months positive 4.2%. A massive swing.
On Thursday we have Retail Sales expected to be 0.4% from the previous months -0.1%. A massive swing the other way.COT data shows that large commercials slightly decreased their net long position from 84,684 to 66,468. We therefore alter our position from BULLISH to SLIGHTLY BULLISH.CNY: Both newsworthy items out on Wednesday when we have both Manufacturing PMI and Caixin Final Manufacturing PMI.

The former is expected at 49.7 which is unchanged and the latter is expected at 47.2 up 0.2 from the previous month.
Both figures measure the same thing but are produced by different bodies.There is no COT data for the CNY.


S&P500: The recent fall in the S&P has seen large commercials move their positions dramatically. The previous week’s net short of 149,444 has been replaced with a net long of 79,876 which is a 52 week extreme. We therefore have to be BULLISH in the short term.GOLD: Large commercials slightly increased their net short position slightly from 55,979 to 57,228. This is not a material move and we therefore maintain our stance of SLIGHTLY BULLISH.

SILVER: Large commercials have slightly increased their net short position from 21,357 to 31,314. We therefore remain SLIGHTLY BEARISH in the very short term.THOUGHTS FOR NEXT WEEK The only thought on traders minds will be this coming Friday’s release of the Nonfarm payroll number and the Unemployment rate.

However do not forget to follow Hourly Earnings. This figure has quietly but surely been on the increase over the last few months and is one of the most important leading indicator for inflationary pressures in the future when rising and for deflationary pressures when falling.
the FED will raise. When it does so it will be the beginning of a series of increases. It will not be a one off event.

For those who want to join the lucky ones receiving real time, accurate and 100% honest trade signals please visit and subscribe here.Stay nimble. Good luck trading.


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