The 3 Plays facing all Aussie Traders

We will do a deep dive into how to trade the upcoming US Federal Reserve meeting on Wednesday but for now we need to address the Fed and others from an Australian traders perspective as it is one of 3 plays we need to be mindful of. 1. Hard or Soft – Can we stick the landing? All central banks across the developed world are doing summersaul...

September 17, 2024
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The Third Digital revolution – The “Now” Questions for AI

Over the past 3 months Nvidia has moved through ranges that some stocks don’t do in years, in some cases decades. Having lost over 35 per cent in the June to August sell off, it quickly bounced over 40 per cent in the preceding 20 days once it hit its August low as we build positions ahead of its results.  These results delivered Nvidia style...

September 13, 2024
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Strength of Signal – An Important Consideration for Traders?

In this article, we take an in-depth look at the concept of strength of signal and its potential role in improving trading outcomes. Traders are constantly seeking ways to enhance their results consistently, and the idea of evaluating the strength of a trading signal may provide a pathway toward greater reliability and performance when applied to t...

September 13, 2024
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The FX: Has the Fed dropped the ball?

We have been discussing Sahms’ law for the last few weeks. This is the regression indicator that signals the possibility of recession. For those that can't remember, Sahms' recession indicator is when the three-month moving average of the unemployment rate has risen by more than 0.5 per cent from the previous 12 month low. Every time this has hap...

September 9, 2024
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That’s a wrap – The ASX earning season

So FY24 earnings are now done and from what we can see the results have been on the whole slightly better than expected. The catch is the numbers that we've seen for early FY25 which suggested any momentum we had from 2024 may be gone. So here are 8 things that caught our attention from the earnings season just completed. Resilient Economy...

September 3, 2024
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Jackson Hole leaves a hole heap of questions about employment

We now have a post-Jackson Hole set of questions – will the data stick up to what was preached. Reviewing the reactions to Jackson Hole treasury yields declined on a ramp up in bets around the Federal Funds rate after Federal Reserve Chair Jerome Powell's dovish remarks, which were in line with what we forecasted last week. His dovish remarks ...

August 27, 2024
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Jackson Hole Symposium – When doves try

Jackson Hole Symposium – When doves try Market pricing of the Federal Funds rate currently sits at 93 basis point of easing by year-end. Let us put that into perspective it was 110 basis points of easing at the peak of excitement, yet despite the increase in yields DXY has sold off and now trades sub-102.00 and is still falling like a stone. W...

August 21, 2024
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Hold tight: trading the RBA

With core CPI missing expectations and some slight deceleration in other areas such as retail sales an overall service economic activity. The RBA is likely to hold tight and not raise rates on Tuesday. We say this with some confidence, based on the communication coming from RBA governor Bullock. She had emphasised the importance of the second qu...

August 5, 2024
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One of two ways: Trading Australia’s CPI data

Australia's second quarter CPI due out on the 31st of July could go one of two ways so let's dive into how it will move and how to trade it. First way - Coming in line or below Currently 24 of the 30 surveyed economists see inflation coming in line or below expectations. That is June quarter CPI coming in at 1% quarter on quarter and 3.8% yea...

July 30, 2024
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Deja vu of 2023

Market action and underline breath of the last two and half weeks has been extreme and rather eye opening.  The S&P 500 has made 38 record all time highs in 2024 so far, however since its most recent peak on July 16 it has traded lower ever since. Now we need to put that into perspective, the pullback since its July high is 4.75 percent to ...

July 26, 2024
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Do you catch a falling knife?

We all know the market term ‘don't catch a falling knife’. And in the current market conditions why would you? But with indices, the likes of the magnificent 7, industrials and banks doing so well in 2024 people are asking where's the value? And that is why people chase falling knives, because they perceive this value. They perceive that if ...

July 23, 2024
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US trading thematics Part 3: More than the Trump trade

We've held off making comments about the events of what happened last weekend. Everyone has seen it, everyone knows the horrible scenario that it was but it is probably also meant that we have missed really key economic and fundamental trading reasons U.S. markets are now in a very broad bull market scenario. Inflation It was only 10 weeks ag...

July 17, 2024
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US trading thematics Part 2: Data Confirming

Will June be the turning point? The market thinks it is – and its reaction to the CPI data not only signalled how it will trade in the coming months. It also showed that traders are primed to rotate to even more bullish positions. Because from the market’s perspective September is now more than live its near enough to a lock for the Fed to cut ...

July 12, 2024
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US trading thematics: Part 1 “When Powell talks”

Over the coming 48 hours and then over the coming 2 weeks, Fed speak and US data is going to be some of the best trading opportunities in 2024. It’s been a pretty low-vol year despite several events that would under normal circumstances be triggers for much larger fluxes in FX and bonds. But to date: that has not been the case. Let's look at t...

July 10, 2024
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Earning Season: Prep starts now

We are less than three weeks away from the ASX earning season and we are less than two weeks away from the earnings season in the US. So, we need to start prepping for trades and opportunities now.  First and foremost, do not forget that confession season is well and truly upon us here in Australia. Downgrades clearly have been coming from the ...

July 5, 2024
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