IBKR Quant Blog


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Technical Analysis

Nasdaq - Technical Take: Crude Oil Down on Supply Expectations


Technical Take: Crude Oil Down on Supply Expectations

Crude oil is down more than 3% today due in part on growing expectations of increased supply coming from Saudi Arabia,  as well as the potential for the US to grant select exemptions allowing some buyers to purchase Iranian oil.  Crude oil (WTI) finished June on a strong note with back to back weekly gains of 5.4% and 8.1%.  However two weeks ago it formed a bearish doji pattern which was proceeded and confirmed by last week’s bearish engulfing candlestick and a decline of 3.8%.  The next major support is down at the 40-week sma, now $63.63.            

Nasdaq's Market Intelligence Desk (MID) Team includes: 

Charles Brown is Associate Vice President on the Nasdaq Market Intelligence Desk with over 20 years of equity capital markets experience. Charlie has extensive knowledge of equity trading on both floor and screen based marketplaces. Charlie assists with the management of The Market Intelligence Desk and works with Nasdaq listed companies providing them with insightful objective trading analysis.

 

Steven Brown is a Managing Director on the Nasdaq Market Intelligence Desk with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

 

Christopher Dearborn is a Managing Director on the Nasdaq Market Intelligence Desk. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

 

Brian Joyce, CMT is a Managing Director on the Nasdaq Market Intelligence Desk. Before joining Nasdaq, Brian spent 16 years as an institutional trader executing equity and options orders for both the buy side and sell side. He also provided trading ideas and wrote technical analysis commentary for an institutional research offering. Brian focuses on helping Nasdaq’s Financial, Healthcare and Transportation companies, among others, understand the trading in their stock. Brian is a Chartered Market Technician (CMT).

 

Michael Sokoll, CFA is a Senior Managing Director on the Nasdaq Market Intelligence Desk with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing Nasdaq-listed companies with real-time trading analysis and objective market information.

 

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This article is from Nasdaq and is being posted with Nasdaq’s permission. The views expressed in this article are solely those of the author and/or Nasdaq and IB is not endorsing or recommending any investment or trading discussed in the article. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 

 


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acciones

Nasdaq Market Intelligence Desk - Equity Market Insight July 16, 2018


As of 10:46 AM EDT:

NASDAQ Composite -0.08% Dow -0.05% S&P 500 -0.18% Russell 2000 -0.38%

NASDAQ Advancers: 892 Decliners: 1286

Today’s Volume (First Hour) -0.7%

After a flat open the markets drifted fractionally into the red and that follows generally lower conditions in Asia and Europe.  Somewhat weaker than expected industrial production data from China set the tone while several positive earnings reports in the US aren’t moving the market.  Most sectors are modestly lower with Energy (-1.8%) under the most pressure as crude oil falls over 3%, and Financials (+1.0%) lead. The dollar, gold and treasuries are all a little weaker at the start of the week. 

  • The Commerce Department reported that Retail Sales rose solidly by 0.5% in June, boosted by increases in the purchases of automobiles and a range of other goods. Auto sales increased 0.9% after advancing 0.8% in May. Service station receipts rose 1.0% largely on higher gasoline prices. Ex autos retail sales jumped 0.4% after rising by a upwardly revised 1.4% in May. Overall retail data for May was revised higher to show a sales increase of 1.3% instead of the previous reported 0.8% gain. May’s increase was the largest since September of 2017.

 

  • After falling for the past two weeks crude oil open this week with a 3.3% decline.  There is concern that the US may tap the Strategic Petroleum Reserves and other countries may follow, all in an effort to lower prices.  No doubt that will be a continuing mantra in the US until election day in November.  Even with the recent declines WTI crude is still about 40% less expensive that the recent peak in 2013. 
  • On the earnings front, JB Hunt (-2.7%) moved lower despite an above consensus quarter, Bank of America (+2.7%) missed slightly on top line but beat on bottom line, and Blackrock (-0.6%) is lower despite beating top and bottom lines.  Tonight comes Netflix and then we get Goldman Sachs and Johnson & Johnson in the morning. 

     

Nasdaq's Market Intelligence Desk (MID) Team includes: 

Charles Brown is Associate Vice President on the Nasdaq Market Intelligence Desk with over 20 years of equity capital markets experience. Charlie has extensive knowledge of equity trading on both floor and screen based marketplaces. Charlie assists with the management of The Market Intelligence Desk and works with Nasdaq listed companies providing them with insightful objective trading analysis.

 

Steven Brown is a Managing Director on the Nasdaq Market Intelligence Desk with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

 

Christopher Dearborn is a Managing Director on the Nasdaq Market Intelligence Desk. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

 

Brian Joyce, CMT is a Managing Director on the Nasdaq Market Intelligence Desk. Before joining Nasdaq, Brian spent 16 years as an institutional trader executing equity and options orders for both the buy side and sell side. He also provided trading ideas and wrote technical analysis commentary for an institutional research offering. Brian focuses on helping Nasdaq’s Financial, Healthcare and Transportation companies, among others, understand the trading in their stock. Brian is a Chartered Market Technician (CMT).

 

Michael Sokoll, CFA is a Senior Managing Director on the Nasdaq Market Intelligence Desk with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing Nasdaq-listed companies with real-time trading analysis and objective market information.

 

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This article is from Nasdaq and is being posted with Nasdaq’s permission. The views expressed in this article are solely those of the author and/or Nasdaq and IB is not endorsing or recommending any investment or trading discussed in the article. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

 


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Macro

Franklin Templeton - Fixed Income ETFs: Democratising Price Discovery for Investors - By Jason Xavier


Opportunities to invest nimbly in fixed income securities have traditionally been limited for all but large, sophisticated investors. The emergence of fixed income exchange-traded funds (ETFs) has changed that and brought some much-longed-for democracy to the fixed income arena, explains Jason Xavier, head of EMEA ETF Capital Markets at Franklin Templeton Investments.

Democratisation of financial markets is one of the characteristics with which exchange-traded funds (ETFs) are often credited.

ETFs offer, to a wider range of investors, opportunities to trade in ways that were previously the preserve of professionals or institutions. The latest arena in which that democratisation has come to the fore is fixed income.

Bond Markets Have Been Traditionally Opaque

Bond markets have historically been relatively opaque for some investors.  Fixed income has tended to be bought and sold over the counter (OTC). In other words, buyer and seller agree on a price bi-laterally.

Less than half of the sovereign and corporate bonds outstanding in the eurozone trade on the region’s exchanges. The balance trade in the OTC markets.

An ETF wrapper not only opens up access to the asset class, but also democratises its price discovery.

Limited Access to Bond Wholesalers

Generally, only larger or institutional investors have had access to bond wholesalers. And unlike their larger or institutional counterparts, some investors may have less expertise in the basics of bond trading. They may also lack access to large dealer networks for quotes, in order to shop around for the best prices available.

Mutual funds have been a popular choice for many wealth managers, independent financial advisors or retail investors looking for exposure to fixed income assets.

A fixed income mutual fund, with daily net asset value (NAV) trading and valuation, will typically offer clients their desired exposure.

Opening Up Intra-Day Trading

While a mutual fund may be sufficient for many investors, others might be looking for alternatives offering access to intra-day pricing, trading and downstream monitoring, for example.

The evolution of ETFs, particularly in the fixed income arena, can deliver on some of those needs, offering even retail investors access to a market with the same price discovery/transparency as their institutional counterparts.

The Importance of Price Transparency

The fact that the ETF wrapper has taken a largely off-exchange, OTC-driven asset class and democratised its price discovery is important to point out. Price transparency underpins the efficiency and fairness of all financial markets.

Transparent markets promote more efficient and cost-effective trading and, in turn, higher levels of investor confidence and participation.

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The comments, opinions and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or to adopt any investment strategy. Because market and economic conditions are subject to rapid change, comments, opinions and analyses are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment or strategy.

What Are the Risks?

All investments involve risks, including possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. Investments in foreign securities involve special risks including currency fluctuations, economic instability and political developments.

To get insights from Franklin Templeton delivered to your inbox, subscribe to the Beyond Bulls & Bears blog.

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This article is from Franklin Templeton and is being posted with Franklin Templeton’s permission. The views expressed in this article are solely those of the author and/or Franklin Templeton and IB is not endorsing or recommending any investment or trading discussed in the article. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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Macro

PIMCO - Eurozone Outlook: When Secular Turns Cyclical - By Nicola Mai and Andrew Bosomworth


Over the next few years, financial markets could be set for a series of “Rude Awakenings,” as we forecasted in our latest Secular Outlook. The global economy is transitioning out of a post-crisis period characterized by remarkable stability, and the changes ahead could be jarring for investors.

In Europe, this forecast appears to be unfolding already.

Among the key secular risks we identified in our outlook are the emergence of a radical populist backlash against capital, the establishment and free trade; a shift in the policy mix toward fiscal expansion; a market environment characterized by less reliance on central banks; escalating geopolitical conflict; and a likely global recession in the next few years.

In Europe, Italy recently elected a radical anti-establishment government that intends to engage in significant fiscal easing just as the European Central Bank (ECB) is retreating from asset purchases. Geopolitical risks are on the rise, as the ongoing immigration and refugee crisis shows. And the still-fragile design of the currency union leaves the region very exposed to downside risk when the next recession hits.

Not only do the secular risks we highlighted look relevant for Europe, but they appear to be materializing more quickly than expected, particularly in Italy, and spilling over into the near-term, cyclical horizon.

Italy at the forefront

Just days after our Secular Forum ended in early May, Italian government bond (BTP) yields jumped more than 100 basis points (bps) to around 250 bps over those of German bunds, and have hovered there for weeks. The rise came as anti-establishment parties Five Star Movement (M5S) and the League forged an alliance around a program entailing a very large fiscal easing package and the possible introduction of a parallel fiscal currency. Importantly, an early version of this program also backed the introduction of mechanisms in Europe that would allow sovereigns to exit the currency union. And the administration in Italy appointed some clear euroskeptics to key ministerial and senior staff posts.

As market volatility spiked, the new Italian government sought to reassure investors, but the damage was done. The euro-exit genie has been released from the bottle, and the government’s fiscal plans contrast sharply with Finance Minister Giovanni Tria’s recent assertion that public debt should be reduced.

Rising political risk in Italy comes against the backdrop of a currency union with a less-than-solid infrastructure. Macro convergence efforts across core and periphery countries in the eurozone have remained insufficient, and the region lacks the fiscal and financial stabilization mechanisms that would mitigate the impact of the next downturn. The EU summit in June was another missed opportunity in this regard, with major decisions on regional integration postponed again. Progress now looks difficult given divergent views among member states on important issues such as common deposit insurance and a eurozone budget.

What about the ECB?

As the only truly federal institution in the eurozone with significant financial firepower, the ECB has been the glue holding the region together. But investors may not be able to count on the ECB in the same way going forward for several reasons. First, the ECB’s asset purchase program is coming to an end, and restarting it may not be entirely straightforward given political opposition to the program in several countries. Second, the shift in ECB leadership in autumn 2019 raises uncertainty. Third, the ECB would likely find it hard to quell market stress by purchasing sovereign bonds if that stress comes from governments’ euroskeptic ideologies and fiscally irresponsible actions. Last but not least, fiscal capacity is unevenly distributed across the eurozone, and common fiscal instruments, such as the European Stability Mechanism, are currently too small to accommodate the potential needs of large countries like Italy.

All in all, the eurozone faces a challenging outlook over the secular horizon, which appears to be spilling over into the cyclical horizon. We think this calls for caution when investing in eurozone periphery sovereigns and risk assets more broadly, and supports our secular investment theme of giving up some yield potential in exchange for portfolio flexibility.

For more on Europe and the global economy, please see our Secular Outlook.

READ NOW

Nicola Mai is a PIMCO portfolio manager and leads sovereign credit research in Europe. Andrew Bosomworth is PIMCO’s head of portfolio management in Germany and a regular contributor to the PIMCO Blog.

PIMCO is one of the world’s premier fixed investment managers. Since our founding in 1971 in Newport Beach, California, we have grown into a global organization with more than 2,150+ professionals united in a single purpose: creating opportunities for our clients in every environment. Our focus on excellence and our short- and long-term track record has encouraged institutions, financial advisors and millions of individual investors to entrust us with their assets. Visit PIMCO’s blog.

Subscribe To Get PIMCO Insights Delivered Directly to Your Inbox.

This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. © 2018 PIMCO PIMCO Investments LLC, distributor, 1633 Broadway, New York, NY 10019, is a company of PIMCO.

This video is from PIMCO and is being posted with PIMCO’s permission. The views expressed in this video are solely those of the author and/or PIMCO and IB is not endorsing or recommending any investment or trading discussed in the video. This material is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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Macro

Real Vision TV - The Evolution of Gold Mining


The evolution of gold mining continues with the use of compressed air and hydraulic drills, but not without consequences.

Real Vision Publications delivers highly curated, big thinking and actionable investment research from the world’s top financial minds.

Offering you quality financial research that’s hard to find in an industry riddled with sensationalism and consensus-led content. No bias, no sponsors, just honest, independent insight from thought leaders.

Teaming up with 30 of the finest independent thinkers, Real Vision Publications gives you access to research, often exclusive to elite investors, exposing you to diverse insights and original thinking. 

Real Vision Publications brings you bi-weekly research reports, with over 100 research reports per year covering all aspects of financial markets, all housed on a dedicated platform with download and print features.

With so many quality research reports at your fingertips, you’ll be able to avoid investing pitfalls and be a sharper, smarter investor.

Disclaimer: This content is from Real Vision Publications and is being posted with Real Vision Publications’ permission. The views expressed in this newsletter are solely those of the author and/or Real Vision Publications and IB is not endorsing or recommending any investment or trading discussed in the video. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.

Information posted on IBKR Traders’ Insight that is provided by third-parties and not by Interactive Brokers does NOT constitute a recommendation by Interactive Brokers that you should contract for the services of that third party. Third-party participants who contribute to IBKR Traders’ Insight are independent of Interactive Brokers and Interactive Brokers does not make any representations or warranties concerning the services offered, their past or future performance, or the accuracy of the information provided by the third party. Past performance is no guarantee of future results.

This video is from Real Vision TV and is being posted with Real Vision TV’s permission. The views expressed in this video are solely those of the author and/or Real Vision TV and IB is not endorsing or recommending any investment or trading discussed in the video. This material is for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities, currencies, or other instruments, those references do not constitute a recommendation by IB to buy, sell or hold such security. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.


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