US June retail sales +0.6% vs -0.4% expected

US June 2021 retail sales data

US June 2021 retail sales data
  • Prior was -1.3% m/m (revised to -1.7%)
  • Retail sales ex autos +1.3% vs +0.4% expected
  • Prior ex autos -0.7% (revised to -0.9%)
  • Retail sales control group +1.1% vs +0.4% expected
  • Retail sales ex auto and gas +1.1% vs -0.8% prior
  • Ex autos/gas/building materials/food services +1.1% vs -1.4% prior
  • Full report
Sales are up 18.0% above the June 2020 level.
Some key categories (m/m):
  • Food services and drinking places +2.3%
  • Non store retailers (online) +1.2%
  • Clothing and accessories +2.6%
  • Gasoline stations +2.5%
  • Electronics and appliances +3.3%
  • Furniture -3.6%
  • Motor vehicle and parts dealers -2.0%
The ‘food services and drinking places’ is the cleanest category to evaluate the reopening and how much of the pent up savings people will spend. The 2.3% climb follows a 3.7% rise in May and a 5.1% rise in April.
US retaurant sales m/m
Here’s another way of looking at it. You can see that it’s back on trend. What you would expect though (especially if you’re looking for a reopening boom) is an overshoot for a number of months and a burst of spending.

Trading Psychology and Self-Reflection

Never be too proud that you are unwilling to point out your flaws.  In this article, you will see a number of examples where I have called out flaws in my trading.  This is both therapeutic and also forces me to realize that my issues have little to do with my system and more around how I mentally approach the market.

If you approach the market from a negative perspective, you will lose money.  Negative does not mean you expect to lose, but you may have a lot of fear in your trading or have not fully accepted the risk.   Reviewing your equity curve and keeping a trading journal will help you navigate times when you fall off the rails.

PBOC says will not set timetable for digital yuan rollout

PBOC issues white paper on research development of digital yuan

  • Says will steadily push forward with digital yuan pilot
China is arguably the frontrunner among major economies in rolling out a central bank digital currency, hence why their crackdown on cryptocurrencies in general have been rather strong and forceful.
I would expect that if a digital yuan is generally well received, expect other major central banks to quicken the pace of their own rollout as well.
And that would mean tighter regulation for so-called ‘stablecoins’.

Recognizing when you are wrong

Recognizing when you are wrong does not mean the stock deviated from how your analysis stated things should go.  Remember, the market is completely random.  Understanding when you are wrong is something you need to define.  For me, it’s how much a position goes against me before I see a profit.  Once this happens things will go one of two ways for me.  First, the market will give me the mercy exit opportunity and will close the position with a minor loss or slight gain.  Secondly, the market will continue in the opposite direction and I will take a bath.  Please do not get caught up in my specific rules; more focus on the fact that you need to know when you are wrong.  Accepting that you will not always get it right will save you all sorts of time and money.

More importantly, you will begin to think of the market in terms of averages.  You will have x percentage of winners and x percentage of losers.  There is no escaping this fact.  Show me a trader that always needs to be right and I will show you a negative equity curve.

BOJ statement – No change to main policy settings

Bank of Japan July 2021 monetary policy meeting

Keeps monetary policy steady

  • maintains 10-year JGB yield target around 0%
  • maintains short-term interest rate target at -0.1%
Growth forecasts downgraded for this fiscal year:


  • real GDP median forecast for fiscal 2021/22 at +3.8% vs +4.0% in April
  • real GDP median forecast for fiscal 2022/23 at +2.7% vs +2.4% in April
  • real GDP median forecast for fiscal 2023/24 at +1.3% vs +1.3% in April


Core CPI forecasts ahead:

  • Fiscal 2021 0.6% y/y vs. 0.1% in April
  • FY 2022 0.9% vs. 0.8%
  • FY 2023 1.0% vs. 1.0%
The BOJ see big gains for the inflation in the current fiscal year but more muted gains after that.
From the Bank’s quarterly report, Headlines via Reuters:


  • Japan’s consumer inflation likely to hover around 0% for the time being
  • consumer inflation likely to gradually accelerate
  • economic outlook highly uncertain, swayed by pandemic developments
  • the economy remains in severe state but picking up as a trend
  • risks to Japan’s economic outlook skewed to downside for time being, balanced longer term
  • risks to price outlook skewed to downside
  • medium-, long-term inflation expectations moving sideways
  • long-term inflation expectations likely to heighten ahead
  • financial intermediation may stagnate if bank profits come under prolonged pressure from covid-19
  •  corporate profit continue to improve although recent rises in commodity costs will weigh


In the immediate aftermath of the statement and report USD/JPY is barely changed:

USD/JPY chart boj july 16 2021

Truly Accept the Risk

Finally! An Alternative to Risk Matrices | Corporate Compliance InsightsSome of you reading this will say that you always place your stop and are willing to lose the money.  While you may say this, you really don’t want to lose the money.   You’ll place your stop out there, which could be pretty far off from your entry price.  Over the next couple of hours or days depending on your timeframe, you will slowly move the stop up because the stock is not “acting” properly.  Sure enough, at some point, your new stop order is triggered right before the market takes off.  If this has happened to you, it is one of the most frustrating events that can occur in the market.  Your analysis was right, the market, in the end, gave you what you expected; however, you were not willing to accept the randomness of the market and the fact you could lose money.

PBOC sets USD/ CNY central rate at 6.4705 (vs. yesterday at 6.4640)

The People’s Bank of China set the onshore yuan (CNY) reference rate for the trading session ahead.

    • USD/CNY is permitted to trade plus or minus 2% from this daily reference rate.
    • CNH is the offshore yuan. USD/CNH has no restrictions on its trading range.


  • The previous close was 6.4615
  • Reuters estimate was 6.4678 (A rate that’s significantly stronger or weaker than expected is typically considered a signal from the PBOC).

PBOC injects 10bn yuan via 7-day reverse repos

  • 10bn RRs mature today
  • thus a net natural day for open market operations
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