Wednesday, August 15, 2012
UK - More data that flies in the face of the growth figures of the ONS. Some component of Okun's Law doesn't add up and, as the market is becoming more aware, it's the growth side. So despite the UK press deriding the government for lower growth levels than Europe it would appear that we are in for a pretty good bounce in growth figures - or further dismissal of ONS reliability. TMM are beginning to think that the ONS should open source all their data so that people can do their own analysis as the ONS are so useless at it.
Aus - Aud appears to be the new Tabloid trade with a the only disagreement being what to short it against. GBP, EUR and CAD being favourites, but TMM are slightly concerned that too many short term specs have piled in leaving them vulnerable to a squeeze from ongoing reserve manager purchases. We'll wait for a rally to sell into and we may just pick NZD to sell it against.
Equities - Technicals look as though we are rolling over on many counts and with the market driven by models we wouldn't be surprised if that function dominates, though we are looking for much more upside there could be a couple of days of bear food.
Oil - Toit as a Toiger. So our oil mates tell us. Slow down in production in Brent soon adding to price hikes but our normal premise of oil being the "govnor" would lead us to believe its a pre-emptive growth trade rather than middle east warning, though indeed Syria is turning into the thunderdome for extremists to punch it out in. On that point, USD/ILS? Two days of rallies unwinding fast and oh look at that - a double soothsayer sell .
Greece - Unlike last year where TMM found a population in denial this year there appeared to be more of an acceptance of the situation and, dare we say it some, humility. Good to see more local goods on the shelves even if the price of olives is still more than at top end supermarkets in London. And butter at E4.30 for 250 grams? Glad to see opportunism is alive and well. TMM are going to arb Lidl against Fiskardo supermarkets.
US data - Back to the QE trade. Inflation weak + weak Empire manufacturing = QE3 chance heightened = sell Usd/Jpy and buy gold. Buy equities too but with technical signals pointing lower we end up flat ...Blaaaa.
Assumption day in Europe - As TMM love to tell their juniors - "Assumption is the mother of all f**k ups". If only the market would take heed.
Back to sleep.