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Equities Higher As Optimism Returned

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STATE OF THE MARKETS

Equities higher as optimism returned. Global equities from S&P500 (+1.14%), Dow (+1.35%), Nasdaq (+0.99%), FTSE100 (+0.50%), all climbed higher Wednesday; including Nikkei (+1.54%) as Japan re-opened for trading after local holiday. Market optimism has returned after Feds chief Jerome Powell reassured that Feds will maintain ultralow rates and continue the bank’s monetary policies. US bond futures saw a flow of more than $260 billion of block orders as the 10Y yields remains in the 1.405% region.

Crude futures continue its upward trajectory as more than $368 million worth of block orders rushed when the black gold hit $63.50/bl while speculators were seen with ready offers at the $64-64.20/bl levels. Gold remains suppressed below the $1,800-1820 levels as yields seekers preferred bonds over the anti-inflationary asset; though bidders were strong in the $1,780 region.

In the FX space, not much changes were observed since Tuesday as demand for safe-haven Swiss and Yen eased across the board while supporting the Greenback and Euro. The Comdolls continue its reign in demand while Sterling retreated on profit taking in the short-term while remain at the helm of demand in the long term.


G8 CURRENCIES SENTIMENTS

ST NZD AUD CAD GBP EUR USD CHF JPY ST
MT NZD AUD GBP CAD EUR USD JPY CHF MT
LT GBP AUD NZD CAD EUR USD CHF JPY LT
** ST refers to Short-Term which is daily turnover, MT is Medium Term which is weekly 
and LT refers to Long-Term which is monthly turnover.

WALL ST MOST ACTIVE

TICKER LAST PRICE

% CHANGE

VOLUME 90 DAYS AVG
SNDL 1.45 + 15.08 433,296.3K 456,600.5K
AMC 9.09 + 18.05 376,881.8K 96,620.6K
SYPR 5.06 + 90.23 193,632.2K 550.6K
CCIV 28.70 – 18.49 142,471.9K 25,673.7K
NAKD 1.35 + 31.07 198,674.8K 187,117.2K
CTRM 1.11 0.00 127,997.8K 120,269.9K
SQQQ 13.29 – 2.49 115,770.5K 63,186.6K
AAPL 125.35 – 0.41 111,039.9K 107,568.0K
GE 13.12 + 4.21 106,791.0K 91,510.8K
WKHS 15.13 – 8.11 100,347.2K 16,575.9K
** % Change here refer to price

WALL ST TOP FLOWS

TICKER LAST PRICE

VOLUME

% CHANGE FUNDS FLOW $
TSLA 742.02 36,766.9K + 38.34 27,281.8M
AAPL 125.35 111,039.9K + 12.03 13,918.9M
AMZN 3,159.53 3,011.2K – 20.14 9,514.0M
GME 91.71 83,111.7K + 110.99 7,622.2M
BA 229.34 30,709.2K + 138.92 7,042.8M
NVDA 579.96 11,207.9K + 43.99 6,500.1M
SQ 237.32 26,123.1K + 149.16 6,199.5M
MSFT 234.55 26,339.7K – 8.40 6,178.0M
NIO 51.86 82,488.5K + 16.99 4,277.9M
FB 264.31 15,736.1K – 16.21 4,159.2M
** % change here refers to volume

TOP 5 BLOCK ORDERS

SYMBOL PRICE/STRIKE TYPE VOL/OI FUNDS FLOW $
PBR 8.72/9.00 stock options/put 173.16 554.4M
GPN 204.27/220.00 stock options/call 91.72 360.9M
HAL 22.27/23.50 stock options/call 72.37 332.4M
ZN/TN/UB 134.0350 – 189.1300 US bond futures 17,549 260,771.9K
CL 51.30 – 63.00 crude oil futures 6,400 368.5M

OUR PICK – XAU/USD

In a tug of war. The precious metal gold right now is in a tug of war between aggressive sellers and aggressive buyers. This was evident in the order flows of the futures markets and the balance of power, as of this writing, was skewed towards the sellers. Buyers were strong in the $1,760-80 area but not as strong as the sellers in the $1800-20 area; and if this trend continue, we might see another dip lower.

Looking at the big picture however, it’s obvious that the precious metal is in a pullback of a long term uptrend as evident in the pennant chart pattern. Indeed $1,780 and $1,855 are the weekly and monthly pivots respectively. So the tug of war is of no surprise. We can play the range and since at this point, price is closer to the weekly pivot, we’ll favor a buy and a sell is possible as price hit the upper band. Price had tested the 50% retracement twice now and there is still risk to the downside (61.8% – circa $1,700/$1,688) as much as to the upside given the tug of war between the $1.9T stimulus and rising yields. Trade management is key in this strategy.

HORIZON STRATEGY SL TP1 TP2
Short-Term Buy 1,755 1,855 1.885
Medium-Term Sell @ 1,855 1,885 1,755 1,700
Long-Term Buy 1,755 1,885 1,950

 

Disclaimer:

This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.