May 262016
 

With change of administration coming, are we going to finally see mining stocks sky rocket? Fundamentally, the PNOY administration has never been supportive of the mining industry. PNOY, in his 6-year term, pushed aside signing the mining sharing agreement. Now with Duterte coming in, will mining firms get support?

Philex Mining, the industry leader here in the PSE seems to have started its bottoming out process. Last February, we saw the break of the downtrend and has since then been breaking recent highs. This is telling us that the downtrend is either taking a breather to continue or to reverse. There’s still no clear indication as to where this will go. But for some types of traders, particularly investors, the accumulation phase may have just begun.
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Jan 262016
 

Last week, the most significant red event came with Draghi’s press conference on policy guidance. There wasn’t much specified but a dovish remark “we will do anything we can” brought the EURUSD lower as expected. EURUSD hit support and closed a little below it at 1.0790.

Now the ball is on the FED’s side as they decide on policy rates and guidance this coming Thursday. Much has transpired since their rate hike last December. We had the China meltdown and oil hitting new lows. These events may cause the FED reassess their hawkish policy guidance and may try to be dovish. This would be contrary to the market’s bullish outlook on the dollar.

The dollar remains to be the strongest among all currencies but traders shouldn’t stay bullish all the time because at some point the currency has to correct and it can correct huge. Remember that the road to parity doesn’t come in a straight line.
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Jan 172016
 

The Japanese Yen continues to be the top choice of currency traders as it lead in gains over the past week. This is all because of concerns about China’s slowdown. Gold, EUR and CHF came next as safe haven investment and currencies. USD maintained to be neutral as it still gained over commodity currencies AUD, NZD and CAD.

This coming week will be more interesting and much as well volatile as the ECB decides on their policy rates and guidance. Hawkish tone can trigger the EURUSD breakout and push it to the next major resistance of 1.11 while a dovish may cause it to correct down to 1.07.
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Jan 102016
 

The currency ranking this past week would be JPY and Gold leading over EUR & CHF. USD comes in 3rd and GBP 4th while the remaining other currencies (AUD, NZD and CAD) were the weakest.

This showed us that the market was shaken with fear on global economic growth and China. Will the market’s perception remain the same over the week? I am seeing that the sentiment on China might improve a bit especially after the Chinese government intervened in their market. USD however may just remain to be weak as it waits for new guidance from the FED after the rate hike.

Given the uncertainty on the USD, we see EUR bulls taking advantage. EURUSD was bullish in the first week of trading and this may continue on to 1.11 area.
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Dec 072015
 

Last week’s market was a surprise for a lot of the EURUSD shorts. Fundamentally, the economic reports and decisions made by the ECB and the FED should really have caused an extreme sell off on EURUSD. Instead, EURUSD turned around and created a huge bullish engulfing.

Every trader should remember the value of technicals. The market generally takes technical movement by as much as 70% in their decision making. Given that the fundamentals were so obvious that market expects the fundamental announcements to be near 100% accuracy, it is but safe to consider that all fundamental values have been priced in.

When fundamentals have been priced in, the best and perhaps only basis for a trader to use to decide would only be technicals. During that time, EURUSD has been quite oversold and it was at a significant support level.

EURUSDXDaily

The question now is, would you take a short trade at 1.08 pre-FOMC rate hike? Shorting EURUSD will always make sense fundamentally but the question is if you will make money out of it or not. While 1.08 can be a good short trade, EURUSD will be better off to short at 1.11 or 1.148.
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Nov 292015
 

The past week was relatively quiet as the US market celebrated thanksgiving. What volatility we have missed last week will come back twice the magnitude as the market steps into a week loaded with red events.

Action starts on Tuesday when China will release several economic reports. Coinciding to that would be Australia’s Cash Rate announcement. This will cause a lot of movement on AUD.

Sterling will be in focus as well, as bank stress test results will be released in the afternoon. PMI data will be released on Wednesday and Thursday.

Canada’s GDP on Tuesday will serve as appetizer going into a rate statement on Wednesday and Employment rate on Friday.
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