Archives of “October 6, 2020” day

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France’s 4th quarter economic growth forecast downgraded to 0% from 1%

  
Analysis, Economy

INSEE: sees consumer spending falling and fourth-quarter

INSEE is out with forecast for fourth-quarter economic growth in France. They now see economic growth downgraded to 0% from 1% as consumer spending falls.
INSEE, is the national statistics bureau of France. It collects and publishes information about the French economy and people and carries out the periodic national census.
The EURUSD has rotated back to the downside and trades negative on the day. Looking at the 4 hour chart, the price is moving away from the 200 bar moving average on the 4 hour chart at 1.1797. Support target comes between 1.1764 and 1.1771.
EURUSD on the 4 hour chart

European shares climb for the 2nd consecutive day this week

  
Analysis, Global Indices

German Dax up 0.7%

The European shares have corn for the 2nd consecutive day. The provisional closes are showing:

  • German DAX, +0.7%
  • France’s CAC, +0.5%
  • UK’s FTSE 100, flat
  • Spain’s Ibex, +1.3%
  • Italy’s FTSE MIB, +0.8%
A look at other markets as the London/European traders look to exit is showing:
  • spot gold down $3.20 or -0.17% at $1910.33. That is down from the high price of $1921.70.
  • Spot silver is trading down $0.30 or -1.24% at $24.07.
  • WTI crude oil futures are trading higher by $1.44 or 3.7% at $40.67. The high price reached $40.83. The low price extended to $39.10.
In the US stock market, the major indices are mixed with the NASDAQ lagging:
  • S&P index is down -1.53 points or at -0.05% at 3407.03
  • NASDAQ index is down -45 points or -0.39% at 11287.75
  • Dow industrial average is up 73 points or 0.26% at 28221.92
In the US debt market, the yields are mixed:
  • 2 year 0.144%, unchanged
  • 5 year 0.329%, -0.6 basis points
  • 10 year 0.780%, minus this 0.1 basis points
  • 30 year 1.598%, +0.9 basis points.

Trader Types and Personalities

  
Analysis, Education
  • Europe's Traders Want Shorter Hours for Health, Diversity - BloombergScalpers
    • High energy, short attention spans.
    • Usually former athletes, tennis and hockey players make the best traders.
    • Able to play both offense and defense simultaneously, and able to think a few steps ahead of the game.
  • Spreaders / Option Traders
    • Quick and flexible thinkers, able to look at numbers and figure risk and value instantaneously.
    • Not in the market to take risk, methodically search for mathematical anomalies and lock in profits immediately.
  • Position Traders
    • Energy level almost nonexistent.
    • Put on passive positions, ride the winners, cut losers.
    • As a position trader, your brains are working all the time, and you keep looking for an informational edge that might drive the market one way or the other.

Toyota Way

  
Analysis, Education

I just chanced upon a good article on Toyota. See here. Just want to capture a few wonderful points:

  1. The American idea of improvement would be to get a special engineering group, or some Six Sigma Black Belts to descend to a review and fix things as a one-off project. After which they would present their success in a PowerPoint all over the place. The Toyota way is where every single person, every single department, in every single day, continuously tries to do things better.
  2. The task is to do the task better.
  3. Improving something starts after fully understanding how it is currently done and hence what you’re trying to improve.
  4. There is a great story about an American employee who had a senior staff meeting with Fujio Cho, Chairman of Toyota worldwide. The employee spoke very positively about an activity that he has been doing. The response that he got was this: “And Mr. Cho kind of looked at me. I could see he was puzzled. He said, ‘Jim-san. We all know you are a good manager, otherwise we would not have hired you. But please talk to us about your problems so we can all work on them together.’”. This is absolutely amazing and a stark contrast to the all-too-often work culture of “don’t tell me about your problems, give me the solutions”.

Pelosi said to say stimulus talks are going ‘very slowly’

  
  Analysis

Politico reports

The report says that talks between Pelosi and Mnuchin are going ‘very slowly’, citing a source from Pelosi’s conference call with Democratic leaders. There’s not much else besides this but at least negotiations are still ongoing for later in the day.
The market built up some optimistic hope about talks going somewhere to start the week, so let’s see if Pelosi and Mnuchin will meet those expectations.

ECB’s de Cos: There is a risk that vaccine might not arrive by middle of 2021

  
  Analysis

At least there is someone that is being realistic

A vaccine being developed will be a great milestone in moving away from the virus crisis, but to expect an immediate change to the global landscape would be naive.
There likely will not be enough vaccines produced for anyone and everyone, and you can expect lawmakers to boast about the breakthrough but caution against its overall effectiveness. Either way, it will still get markets high on optimism if and when it happens.

Scotland to impose two-week mini lockdown from Friday – report

  
  Analysis

The Sun newspaper reports on the matter

Says that sources at the NHS have told the news outlet to expect a ‘circuit breaker’ stay-at-home order for the whole of Scotland starting from 1800 GMT on Friday. Adding that the mini lockdown is expected to last for two weeks.
This comes after another 697 new cases reported yesterday in the country, with 12.8% of people tested producing a positive result.
Scotland*chart updated until 4 October midday

Economic data coming up in the European session

  
  Analysis
The dollar and yen fumbled in overnight trading as the market reversed the moves from Friday and then some, with all of the uncertainty from Trump’s virus infection being put behind and US stimulus talks appearing to move closer to some compromise.
On the latter, we still may not get something before the election but the continued day-to-day talks are still stirring up some positive sentiment in the market for now.
Major currencies are so far little changed, with the aussie getting a brief spike above 0.7200 as the RBA left its cash rate unchanged but is back down to 0.7185 currently.
There isn’t much in terms of data releases today but we will be hearing from the likes of Lagarde and Powell so that may keep things interesting before the market will look towards Capitol Hill once again for any signs of further stimulus progress.
0600 GMT – Germany August factory orders data
Prior release can be found here. This is now a bit of a lagging indicator as we have seen from the manufacturing PMI that factory activity has rebounded quite strongly in Q3, so that should also be reflected in the industrial orders data today.
0730 GMT – Germany September construction PMI
Prior release can be found here. A general indication of German construction activity, which has been keeping more steady in the rebound phase but much like there will be more question marks surrounding that once the catch-up phase loses steam and the focus turns towards new work – which may not be as robust as in the past.

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