Monday 29 March 2021

Week to Mar 26th

Powell/Yellen Testimony to Congress, Dollar breakout, Indices Consolidate

The Powell/Yellen testimony was considered hawkish (by current standards) pushing stocks down and the dollar up. Otherwise, another consolidation week, except for the dollar. Other asset classes either posted a true inside week (US10Y, Gold, DAX) or closed in last week’s range (all indices, Oil). DXY however hit new five-month highs. News-wise, there were few shocks, other than a wild unsustained spike in Gold on Thursday.

Next week sees the end of the month and first quarter, and of course another Non-Farm payrolls, this time with the highest estimate since November. It is Easter week, with four days trading into a four day holiday in many territories. An OPEC meeting on Thursday may break the current Oil consolidation. Other than that, a raft of PMIs, and European inflation (showing Germany breaking apart from the zone as a whole) complete a generally busy week.

Mon Mar 22

Markets rose today although only later in the day after yields had fallen. Slight concern about vaccinations meant COVID-immune NDX outperformed. There is also a notable correlation between bonds and NDX. The dollar continued the rally it started last week, pushing currencies and Gold down. Oil tends to run with industrials, as with DJI the weakest index today, it fell very slightly. Bonds were up.

Tuesday March 23

TreasSec Yellen’s hawkish assessment today, where she expected the US to return to full employment in 2022, which of course indicates an unwinding of QE. Stocks fell, NDX less so, as it is less affected by this. The dollar of course liked it, and was sharply up, meaning Gold, Oil and yields fell both in line with the dollar and equities.

Wednesday March 24

Upbeat PMI data pushed up traditional value stocks today, at the expense of tech, with energy stocks (and Oil) both up on the Suez Canal closure. Simple supply and demand. Less of the former, latter is constant. However everything fell again into the close after another day’s testimony from Powell and Yellen. The dollar continued upwards, and Gold was down in line. Bonds were up for a third day.

Thursday March 25

A weak auction of 7-year paper caused a reversal back down in bonds today. The equity market was up (SPX +0.52%) but again NDX notably underperformed (-0.14%). The dollar rallied for a third day, hitting a five-month high after two weeks of consolidation, pushing Gold and Oil down. When equities are only mildly positive, and the dollar moves strongly, Oil reflects the latter.

Friday March 26

The day was positive, but most of the rally was in the last hour, putting the indices in positive territory for the week. The dollar reversed after three strong days, and this was reflected in Gold and Oil, the latter being assisted by the Suez issue. Bonds were down in line with the equity rally.


Yet another consolidating week for all assets except the dollar. The top index mover was NKY, down 2.07% although 0.63% of this can be attributed to JPY’s move. The top forex mover was NZDUSD down 2.08%. Crypto pulled back slightly, and FANGs slightly underperformed NDX.

I wish I’d stuck with JPY for a third week, but my short of GBPUSD was up 0.57%. Total to date -1.78%, with 7/12 win. This week I think the NZD drop is overdone, and will sell EURNZD

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

Next week sees the end of the month and first quarter, and of course another Non-Farm payrolls, this time with the highest estimate since November. An OPEC meeting on Thursday may break the current Oil consolidation. Other than that, a raft of PMIs, and European inflation (showing Germany breaking apart from the zone as a whole) complete a generally busy week.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

  • Four day Easter week
  • Non-Farm Payrolls
  • UK and Germany inflation
  • OPEC and PMIs

Monday March 29

FTSE Russell should confirm that Chinese government bonds are included in their World Index today. If so, this is bullish for an already extended CNY.

23:30 Japan Jobs/Unemployment

23:50 Japan Retail Sales

Tuesday March 30

Two Fed speakers today, as we move into the close of the quarter.

09:00 Eurozone Consumer Confidence/Business Climate

12:00 Germany CPI (e2.0% p1.6%)

13:00 US Housing/Home Price Indices

13:00 Fed Quarles speech

14:00 US Consumer Confidence(Mar)

18:30 Fed Williams speech

23:50 Japan Industrial Production

Wednesday March 31

The final day of Q1 sees a speech from President Biden. There is a rate decision in Colombia. There is plenty of news, so expect EOQ volatility.

00:30 Aus Building Permits

01:00 China PMIs (Mfr e51.0 p50.6)

06:00 UK Q4 Final GDP (e1.0% prelim1.0%)

07:55 Germany Unemployment Rate/Change

09:00 Eurozone CPI (YoY e0.9% p0.9%)

12:15 US ADP Employment Change (e550k p117k)

12:30 Canada Q4 GDP (MoM)

13:45 Chicago PMI

14:00 US Pending Home Sales

21:30 Aus AiG Performance of Mfg Index

23:50 Tankan Large Manufacturing Index (e0 p-10)

Thursday April 1

The new month and quarter being. There is an OPEC meeting today, and production cuts are expected to be maintained. Look out for any news on the Ever Given, which has effectively closed the Suez Canal. Norway and Denmark are closed for Maundy Thursday.

00:30 Aus Imports/Exports/TB (TB e9.5B p1.01B)

00:30 Aus Retail Sales (e-1.1%, p-1.1%)

01:45 Caixin Mfr PMI

06:00 Germany Retail Sales (e1.3% p-8.7%)

07:55 Germany Markit Mfr PMI

08:00 Eurozone Economic Bulletin

08:30 UK Markit Mfr PMI

12:30 US Jobless Claims

13:30 Canada Markit Mfr PMI

13:45 US Markit Mfr PMI

14:00 US ISM Mfr PMI (e61.2 p60.8)

Friday April 2

Markets are closed in most countries including the US and all of Europe for Good Friday. Markets will be closed for four days (Easter Monday) in many countries. Today is NFP, with the highest jobs estimate since November.

12:30 US NFP/AHE/UnEmp (NFP e655k p379k)

Monday 22 March 2021

Week to Mar 19th

SPX and DJI new ATH, Sharp moves on Fed dovishness, Oil dips

Another consolidating week, but with SPX and DJI hitting new highs, whilst rotation in an out of NDX continued daily. The key feature of the week was a more dovish than expected Fed, but this only cause a 24 hour blip. The most notable move was Oil which pulled back hard after weeks of rising.

Monday March 15

US DST started today. SPX and DJI made new all-time highs today, as US 10-year yields also touched a new 14-month high, all in line with an expected post-COVID world. However, risk returned in the form of NDX rotation. The tech index was up 1.12% vs 0.65% for SPX. The dollar was up in line with yields. Gold surprisingly rose slightly, and Oil was flat.

Tuesday March 16

A 20-year note auction saw strong demand, with the yield down at 2.29% The 30- and 10-year prices were flat. Equities were stalled today, with DJI and SPX fading, but again NDX outperformed, adding 0.53%, with strong FANG performance. The dollar, gold, and Oil were all flat, awaiting the Fed on Wednesday.

Wednesday March 17

Today’s Fed was more dovish than expected with Chair Powell repeating that “substantial” progress was still needed before any QE taper. DXY fell immediately 0.5% in an hour, and all indices rallied (but with NDX underperformance). Yields similarly spiked up. SPX and yields hit new all time and 14 month highs respectively. Gold spiked up on the weaker dollar, and Oil was flat.

Thursday March 18

As often happens after Fed day, there is a delayed reaction and the driver was the dollar. We know this because stocks and Gold both sold off, as the dollar quickly recovered its Fed spike down across the board (ie all currencies fell). Traders rotated out of NDX back into DJIA heavily, with NDX down 3.13%. FANG was in line with NDX, no more. After a sharp rise in EIA inventory, Oil followed equities sharply down, losing 7.64% from its elevated levels, dropping below $58.50 for the first time since Feb 12. It was the worst day for Oil since the April 20 ‘negative price’ fiasco. There was little volatility after the unsurprising BoE rate decision report.

Friday March 19

Triple witching OpEx day made for lively movement but only within a narrow range, and SPX closed flat. NDX once again notably outperformed DJIA by 1.32%. Oil recovered about half of yesterday’s sharp drop. Despite all this, against a flat dollar, gold rose. Bonds fell in line with the equity move.


Another consolidating week where most instruments ended up somewhere in last week’s range, showing by the fact that the biggest index move (DAX) was a modest 0.82%. The top forex mover was GBPJPY down a moderate 0.43%. Crypto was similarly quiet, hardly moving at all, as were FANGs except for FB which shot up.

Another losing week, but only by 0.06% on USDJPY, my running total for the year is now -2.35% with 6/11 wins. I am changing tack now and this week I will sell GBPUSD

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

  • Powell Testimony to Congress
  • Heavy CB schedule
  • Markit PMIs
  • Light US data

Monday March 22

Final full week of the month. As well as Chair Powell on digital innovation, we have Fed speeches from Daly, Quarles and Bowman, and ECB Weidmann.

01:30 PBoC Interest Rate Decision (e3.85% hold)

12:30 Chicago Fed National Activity Index

13:00 Fed Chair Powell speech

Tuesday March 23

Fed Chair Powell testifies before the House today on the Coronavirus Act. Also we have Fed speakers Brainard (twice) and Williams, BoE Cunliffe and BoC Gravelle.

07:00 UK UnEmp/AHE (UnEmp e5.2% p5.1%)

11:50 BoE Governor Bailey speech

14:00 US New Home Sales

16:00 Fed Chair Powell testifies

22:00 Aus Commonwealth Bank PMIs

23:50 BoJ MPC Minutes

Wednesday March 24

Today’s Powell testimony moves to the Senate. Also Fed Williams speaks at 1735. A raft of European PMIs come in the European morning.

07:00 UK CPI (YoY e0.8% p0.8%)

08:30 Germany Markit Prelim PMIs (Mfr e51.8 p 51.1)

09:00 Eurozone Markit Prelim PMIs (Composite e49.1 p48.8)

09:30 UK Markit Prelim PMIs (Services e51.0 p49.5)

12:30 Durable/ND Capital Goods (NDC e1.0% p3.4%)

13:45 US Markit Prelim PMIs

14:00 Fed's Chair Powell testifies

15:00 Eurozone Consumer Confidence

Thursday March 25

There is a European Council Meeting all day. Fed Clarida and Williams speak, as does BoE Governor Bailey for the second time this week.

07:00 Germany Gfk Consumer Confidence Survey(Apr)

09:00 Eurozone Economic Bulletin

09:30 Fed's Williams speech

09:30 BoE's Governor Bailey speech

12:30 US PCE (QoQ)

12:30 US Jobless Claims

12:30 US Q4 GDP Annualised (e4.1% p4.1%)

23:50 Tokyo CPI

Friday March 26

The European Council Meeting continues for a second day. News is light.

07:00 UK Retail Sales

09:00 Germany IFO – Business Climate/Expectations

12:30 US PCE MoM and YoY

14:00 Michigan CSI

Tuesday 16 March 2021

Week to Mar 12th

Rotation every day, New highs in SPX/DJI/BTC, New 13m high in yields

This week, unrelated to daily news, we saw the rotation between industrials and tech reach a frenzy with well over 1% variance between NDX and DJIA every day, but each day different, against an overall move up. NDX bounced firmly off the psychological 10% pullback point, but value bulls, encouraged by recent months after years of despair, won the week, and sent the DJI/NDX at one point to 2.59, a level not seen for nine months, and ATR (a measure of volatility) to a level not seen since for nearly a year. DJI and SPX both made new ATHs this week. Note however, that the ratio has a long way to go to reach its 9.38 level after the dotcom crash of 2000. Note also we are starting to see some use of DAX instead of DJIA as the “non-tech” proxy. The German index is the same size, and holds broadly similar sector weights to DJIA, save that DAX has an even smaller tech sector.

Elsewhere in asset class land, consolidation reigned. Although not quite full inside weeks, yields, DXY, Gold and Oil, all finished inside last weeks range, and none appeared to exhibit pivots or reversals. A hawkish BoC and jobs beat added 1.39% to a lacklustre loonie (the only currency to move more than 1%), whereas a non-committal ECB hardly moved EUR. The only other macro print of note, the US inflation miss (1230 Wed) actually caused a spike up in SPX, as inflation appears to join NFP as “bad news is good for QE”, supported by a noticeable dollar spike down for an hour. BTC made another ATH pushing through $60k.

Monday March 8

There was a strong rally out of tech today, pushing DJIA up and NDX sharply down nearly 3%, into 10%+ correction territory. The rotation out of tech enormously benefited the near tech-free DAX which rallied over 3%. So a near 6% divergence in two major indices. The dollar was sharply up, continuing last weeks rally, which pushed Gold down. Yields stayed up at Friday’s high level, around 1.6%, whereas Oil gave up a little of its recent gains.

Tuesday March 9

A definite turnaround Tuesday, as NDX bounced strongly off its 10% correction support, and added 4.03% on the day, against a flat DJIA. TSLA was up 20%. It was a turnaround for USD, which fell in line with the risk-on mood across the board. Gold and yields also reversed down. Only Oil posted the same colour candle as Monday as it continued to fall.

Wednesday March 10

The $1.9tn stimulus package was finally passed today, but the miss on US inflation at 1230 punctured Tuesday’s optimism and we saw a similar situation to Monday, with DJI outperforming NDX making a new ATH, although the effect was more muted. Yields and the dollar did not specifically react to the CPI print, but continued their downward trajectory. Gold and Oil rose in line with the falling dollar. A hawkish BoC trigged a rise in CAD which continued to the end of the week.

Thursday March 11

The 5.8% SPX correction was technically over today as the SPX made new intraday and closing all-time highs, as did DJI. NDX outperformed again, although the tech index remained 5.5% off its Feb 16 high. The safe haven dollar fell across the board, except for JPY which fell further in line with the mood. The ECB made little difference to EUR, eg EURGBP was flat. Oil was up in line with equities. Gold and bonds were flat on the day.

Friday March 12

Today President Biden announced an acceleration of the vaccination program. Yields rose again, touching 1.62%, a new 13-month high. The bond collapse was matched with new all-time highs in SPX and DJIA, yet NDX fell again, as investors looked to buy a post-COVID world. Markets were helped by a strong beat (83 vs 78) in the Michigan CSI reading. The dollar broke a three-day fade and perked up, although not against CAD which hit a new 3-year high after the Canadian jobs beat. Gold and Oil were flat.


The star index of the week was traditional value-led DAX, up 4.18%, slightly beating DJIA. The top forex mover for the second week was CADJPY up another 1.93%. Cryptos resumed their upward trend, with BTC making new highs, breaking the $60k barrier. FANGs were quiet, and broadly moved in line with NDX.

I could not have got it worse, CADJPY was the worst one to short for a second week. I lost 1.93% and my running total is now -2.35% with 6/10 wins. There seems no end to JPY’s weakness so I will buy USDJPY this week.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

  • US, UK, Japan Rate Decisions
  • US DST starts
  • Canada inflation and Retail Sales
  • OpEx Week

Monday March 15

No significant European or US news for the start of the week. There is a Eurogroup meeting all day. Markets are closed in Mexico. DST is the US starts today so for two weeks, the US will be out of sync (starting one hour earlier) than Europe.

23:15 RBA Governor Lowe speech (Sun)

02:00 China Industrial Production (YoY)(Jan)

02:00 China Retail Sales (YoY e32% p4.6%)

Tuesday March 16

US Retail Sales is the headline today. There is EcoFin Meeting all day. There is a rate decision in Romania.

00:30 RBA Meeting Minutes

10:00 Germany ZEW Economic Sentiment(Mar)

12:30 US Retail Sales (Control Group e-1.2%, p6.0%)

23:30 RBA Kent speech

23:30 Aus Westpac Leading Index (MoM)(Feb)

23:50 Japan Imports/Exports/TB

Wednesday March 17

An interest rate hold is 100% priced today, but watchers will, as always, be looking for changes in the degree of easing, now the pandemic seems to be at last under control. There is a rate decision in Brazil. Markets are closed in Ireland for St Patricks Day.

10:00 Eurozone CPI

12:30 US Building Permits/Housing Starts (MoM)(Feb)

12:30 Canada BoC CPI (Core YoY e1.4% p1.6%)

18:00 Fed Rate Decision/Statement (e0.25% hold)

18:30 FOMC Press Conference

Thursday March 18

Attention turns to the UK’s rate decision today, given the country’s outperformance in vaccinations, especially the speech from Uber-hawk Chief Economist Andy Haldane 30 minutes after Governor Bailey. There are rate decision in Norway, Turkey and Egypt.

00:30 Aus NFP/UnEmp (NFP p29.1k)

01:05 RBA Kent speech

10:00 Eurozone Labor Cost(Q4)

11:00 BoE Cunliffe speech

12:00 BoE Rate Decision/Statement (e0.1% hold)

12:30 US Jobless Claims

12:30 Philly Fed Mfr Survey(Mar)

12:30 BoE Haldane speech

12:30 Canada New Housing Price Index

23:30 Japan National CPI

Friday March 19

The third major rate decision of the week comes from Japan. There is no significant news but it is OpEx day today. There is a rate decision in Russia.

00:30 Aus Retail Sales (MoM e0.4% p0.5%)

03:00 BoJ Rate Decision/Statement (e-0.1% hold)

06:00 BoJ Press Conference

07:00 Germany PPI

12:30 Canada Retail Sales (MoM e-2.5% p-3.4%)

Sunday 7 March 2021

Week to Mar 6th

Volatile but ultimately consolidating week, Dollar recovery, Oil continues upwards

In another week without notable news, markets fells but then recovered on the NFP beat. The dollar continued to recover from the 89.50 support low. Yields made new 2021 highs, as did Oil.

Mon Mar 1

Markets bounced back into the new month today, after the losses of last week with SPX adding 2.4% its biggest one-day gain in nine months, and NDX and RUT outperformed. Gold, bonds and yen were down in line. DXY was was up on the day, but only against EUR, it was down elsewhere, notably against CAD, perhaps a delayed response to strong Oil prices, although the black stuff actually fell today, albeit after a strong run,

Tue Mar 2

Stocks pulled back slightly today after Monday’s strong run. Positive sentiment about vaccines were weighted against fears of a bubble (voiced by China) and notably bubble-like stocks such as TSLA and ZM were hardest hit. NDX underperformed SPX as a whole. Gold, Bonds and JPY were up and Oil was down, all in line with the equity move. The 100% asset class correlation proves that the whole day was sentiment-driven.

Wednesday March 3

The other driven feature of this equity stall, the sharp rise in bond yields, continued today with US10Y adding 8bp on the day. Stocks fell again, with SPX down 1.3% and NDX down 2.7%. The dollar rose again, although not by much, but enough to depress Gold. Oil ignored the turmoil and bounced off $60 support (once resistance) and closed 2.7% up.

Thursday March 4

Jay Powell failed to give investors anything more today (all current stimulus/loosening is priced in) and SPX saw a 3.2% (NDX 3.8%) drop in two hours as the Fed Chair spoke, although it had been rising earlier and recovered some of this recovered into the close. The two indices closed 1.3% and 2.1% down.

The dollar shot up during the same period, as did bond yields. Gold fell in line with the dollar. Oil clearly also reacted to the dollar, spiking up in exactly the same way and adding 4.7% on the day. Perhaps we should ignore the link with equities and instead look at the dollar link on Oil.

Friday March 5

A surprise beat on NFP (279k vs 148k) was enough to cause a sharp rebound back up today, and erase Thursday’ losses completely. SPX rose 2.4%, its best day for nine moth, and NDX rose 3%. The dollar continued to rise, although yields paused and were flat on the day, as was Gold. There was no stopping Oil, which rose again to close 7.58% up on the week.


A whipsaw but ultimately flat week resulted in FTSE being the biggest mover, probably on the back of Oil. The top forex mover was CADJPY up 2.38%. Cryptos rose although not explosively as in previous weeks. FANGs were very variable although not far from the NDX norm.

A second week of buying EURGBP failed badly, and the 0.76% loss took us into a loss for the year, running total now -0.42% with 6/9 wins. The pair has decisively broken the Apr 20 support low, and should now fall, but but once bitten and all that. CADJPY’s move this week was overdone, and at 74.6 is at the highest RSI since April 2013. I am banking on some reversal and selling the pair.

Note we use Google Finance data for daily movements, listing UUP as a proxy for DXY. All references to ‘the dollar’ are based on DXY. The equity and index prices are now based on the cash close each day.

NEXT WEEK (all times are GMT)

(Calendar High volatility items are in bold)

  • ECB Week
  • US and German Inflation
  • Canadian Rate Decision
  • Canadian NFP

Monday March 8

No US news today. Markets are closed in Russia.

05:00 Japan Leading Economic Index

07:00 Germany Industrial Production

10:00 BoE Governor Bailey speech

23:30 Japan Overall Household Spending

23:50 Japan Final Q4 GDP (e3% p3%)

Tuesday March 9

A second day without US news, or indeed much anywhere.

07:00 Germany TB

10:00 Eurozone Final Q4 GDP (e-5% p-5%)

22:00 RBA Governor Lowe speech

23:30 Aus Westpac Consumer Confidence

Wednesday March 10

Chinese and Canadian inflation, and a rate decision on CAD.

01:30 China CPI (e-0.4%, p-0.3%)

12:30 US CPI (Core YoY e1.4% p1.4%)

15:00 BoC Rate Decision/Statement (e0.25% p0.25%)

19:00 US Monthly Budget Statement

Thursday March 11

The ECB may give some indication on the rising German bond yields. Markets are closed in India.

00:00 Aus Consumer Inflation Expectations

12:45 ECB Rate Decision/Statement (e0% hold)

13:30 US Jobless Claims

13:30 ECB President Lagarde Presser

18:30 BoC Schembri speech

Friday March 12

Once again, news is more focused to Europe.

07:00 UK Mfr/Ind Production

07:00 UK Q4 Final GDP

07:00 Germany CPI (e1.6% p1.6%)

10:00 Eurozone Industrial Production

11:30 UK NIESR GDP Estimate (time approx.)

13:30 Canada NFP/AHE/UnEmp (UnEmp e9% p9.4%)

15:00 Michigan CSI (e78 p76.8)