TheStrategyLab.com Price Action Trading Support Forum

Trade Results of M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Price Action Trading (no technical indicators)
Phone: +1 708 572-4885
Free Chat Room: http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164
Business Hours: 8am - 5pm est (Mon - Fri)
questions@thestrategylab.com (24/7)
http://twitter.com/wrbtrader (24/7)


click on the above image to view today's performance verification

Price Action Trade Performance for Today: Emini TF ($TF_F) futures @ $1,750.00 dollars or +17.50 points, Emini ES ($ES_F) futures @ $2,500.00 dollars or +50.00 points, Light Crude Oil CL ($CL_F) futures @ $0.00 dollars or +0.00 points, Gold GC ($GC_F) futures @ $0.00 dollars or +0.00 points and EuroFX 6E ($6E_F) futures @ $0.00 dollars or +0.0000 ticks. Total Profit @ $4,250.00 dollars

Russell 2000 Emini TF Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ The ICE
S&P 500 Emini ES Futures: 1 tick or 0.25 = $12.50 dollars and there's more contract information @ CMEGroup
Light Crude Oil CL (WTI) Futures: 1 tick or 0.01 = $10.00 dollars and there's more contract information @ CMEGroup
Gold GC Futures: 1 tick or 0.10 = $10.00 dollars and there's more contract information @ CMEGroup
EuroFX 6E Futures: 1 tick or 0.0001 = $12.50 dollars and there's more contract information @ CMEGroup

Trade Log: All of my trades were posted real-time in the timestamp ##TheStrategyLab chat room. You can read today's price action trading information about my trades (e.g. time, price entry, contract size, price exit) as the trade traversed to its completion. Also, sometimes I'll post real-time trading tips involving WRBs, WRB Hidden GAPs, Key Market Events (KME), Tutorial Chapters 2 & 3, WRB Zones, Reaction Highs/Lows, Contracting Volatility or Expanding Volatility. Its all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=135&t=1921


Also, posted below are direct links to information about my price action trade methodology and trading plan (there's a difference between the two) that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body/bar analysis). I'm primarily a day trader because it suits my personal lifestyle but I do occasionally swing trade and position trade. Simply, my trade method is applicable for position trading, swing trading and day trading.

##TheStrategyLab Chat Room is free. Members and I use the chat room to post WRB Analysis commentary, real-time trades and to post anything else related to trading. The chat room helps me tremendously in my own trading because I use it to document (journal) general volatility analysis involving WRB Analysis so that I can easily review at a later date my thoughts as I interacted with the markets...info I can not get from my broker statements. Also, this is not a signal calling chat room where a head trader tells you when to buy or sell and I do not have the time/energy/resources to manage a signal calling chat room. Access instructions for chat room @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=164

Price Action Analysis via WRB Analysis Tutorials @ http://www.thestrategylab.com/WRBAnalysisTutorials.htm and there's a free study guide of the WRB Analysis Tutorial Chapters 1, 2 and 3 @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=119&t=718

Trade Signal Strategies via Volatility Trading Report (VTR) @ http://www.thestrategylab.com/VolatilityTrading.htm and there's a free trade signal strategy @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=89 so that you can freely test drive one of our price action trade strategies with support (answering your questions) prior to purchasing the Volatility Trading Report (VTR).

Trading Plan Daily Routine @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=248&t=2530

-----------------------------

Market Context Summaries

The below summaries by Bloomberg, CNNMoney, Reuters and Yahoo! Finance helps me to do a quick review of the fundamentals, FED/ECB/BOE/IMF actions or any important global economic events (e.g. Eurozone, MarketWatch.com) that had an impact on today's price action in many trading instruments I monitor during the trading day. Simply, I'm a strong believer that key market events causes key changes in supply/demand and volatility resulting in trade opportunities (swing points and strong continuation price actions) that reach profit targets. Thus, I pay attention to these key market events, intermarket analysis (e.g. Forex EurUsd, EuroFX 6E futures, Gold GC futures, Light Crude Oil (WTI) CL & Brent Oil futures, Eurex DAX futures, Euronext FTSE100 futures, Emini ES futures, Emini TF futures, Treasury ZB futures and U.S. Dollar Index futures) while using WRB Analysis from one trade to the next trade to give me the market context for price action trading before the appearance of my technical analysis trade signals. Therefore, I maintain these archives to allow me to understand what was happening on any given trading day in the past involving key market events to help better understand my trade decisions (day trading, swing trading, position trading)...something I can not get from my broker statements alone. Further, most financial websites remove (delete) their archives after a few years to make room for new content. Therefore, I maintain my own archives of the news content so that I have it available for me when financial websites no longer archives their content.


click on the above image to view today's price action of key markets

4:10 pm: [BRIEFING.COM] The stock market ended the midweek session on a modestly lower note. The Nasdaq Composite (-0.3%) was the weakest performer while the S&P 500 shed 0.1% with seven sectors ending in the red.

The benchmark index held a slim gain at the start, but spent the day in a slow retreat that featured a brief afternoon spike to lows after the Federal Open Market Committee released its latest policy statement. As expected, the statement called for the final $15 billion taper, thus putting a stop to scheduled purchases of Treasuries and mortgage-backed securities.

Meanwhile, the commentary on rates was little changed from previous directives with the Fed maintaining its reference to keeping the fed funds rate at its current level for a 'considerable time.' Minneapolis Fed President Kocherlakota was the lone dissenter, voting to keep the asset purchase program intact.

Equities handled the initial impact of the announcement relatively well with the S&P 500 finishing about two points above its pre-FOMC levels. Treasuries, meanwhile, ended mixed. The FOMC announcement sent the complex to lows, but the 30-yr bond surged to new highs ahead of the close to pressure its yield one basis point to 3.05%. For its part, the 10-yr note reclaimed its post-FOMC losses with the benchmark yield ending higher by two basis points at 2.32%. Also of note, the 2-yr note settled near its low with its yield higher by six basis points at 0.49%.

The dollar was also on the move, rallying against all other major currencies. The Dollar Index (85.99, +0.59) gained 0.7% to end within a point of its October high (86.87).

Seven sectors finished in the red with the spike in short-term rates helping financials (+0.2%) settle in the lead. Most of the remaining cyclical groups ended behind the broader market while technology (-0.2%) finished near the S&P 500. The top-weighted sector component, Apple (AAPL 107.34, +0.60), added 0.6% while social media names lagged after Facebook (FB 75.86, -4.91) reported earnings. Shares of FB plunged 6.1% with above-consensus earnings being overshadowed by concerns about increased spending plans and slowing revenue growth. Peers Twitter (TWTR 42.08, -1.70), LinkedIn (LNKD 199.51, -5.84), and Yelp (YELP 56.68, -2.43) also lagged, falling between 2.8% and 4.1%.

Elsewhere among cyclical sectors, the materials space (-1.3%) spent the entire session at the bottom of the leaderboard while energy (-0.2%) outperformed. The growth-sensitive group received a helping hand from crude oil, which climbed 1.0% to $82.18/bbl. On the earnings front, Hess (HES 82.89, +0.94) rallied 1.2% in reaction to better than expected results.

Staying on the earnings theme, Gilead Sciences (GILD 110.75, -2.70), which is a major component of the iShares Nasdaq Biotechnology ETF (IBB 290.63, -3.32), fell 2.4% after beating estimates on below-consensus sales of one of its major drugs. Biotechnology weighed on the Nasdaq Composite while the health care sector (+0.03%) registered a slim gain.

Economic data released this morning was limited to the weekly MBA Mortgage Index, which fell 6.6% to follow last week's 11.6% spike.

Tomorrow, weekly Initial Claims (Briefing.com consensus 284,000) and the advance reading of Q3 GDP (consensus 3.0%) will both be released at 8:30 ET.

Nasdaq Composite +8.9% YTD
S&P 500 +7.3% YTD
Dow Jones Industrial Average +2.4% YTD
Russell 2000 -1.5% YTD

3:35 pm: [BRIEFING.COM]

Oil has been trending higher overnight and into the FOMC release, reaching a high of $82.88 right around lunch.
Futures took a hit once the announcement was made that, as expected, the Fed has ended QE.
WTI held above $82/barrel today, but just barely. The Dec contract closed at $82.18/barrel (up 1%)
Dec natural gas held strong and ended +1.6% at $3.79/MMBtu
Dec gold sold off today, but it was a rather small sell-off. Dec gold finished -0.4% at $1224.80/oz, Dec silver rose +0.2% to $17.26/oz

2:55 pm: [BRIEFING.COM] The S&P 500 trades lower by 0.5% with one hour remaining in the session. The benchmark index began inching away from its flat line just after noon ET and has continued that retreat throughout the afternoon.

For the time being, the market is handling the news of the final taper relatively well with the S&P 500 trading roughly five points below where it was just before the 14:00 ET FOMC statement release.

As for Treasuries, the 10-yr note has returned to pre-FOMC levels with the 10-yr yield at 2.33 (+3 bps). However, the 5-yr note remains near its low with the yield at 1.59% (+7 bps).

2:30 pm: [BRIEFING.COM] The S&P 500 has slipped to a fresh low before narrowing its loss to 0.4% while the Dollar Index (85.96, +0.56) has extended its advance to 0.7%.

Nine of ten sectors trade in the red at this time with the materials space (-1.6%) remaining at the bottom of the leaderboard. Meanwhile, the energy sector, which held a solid gain through the first half of the session, is now lower by 0.4%. Crude oil has also retreated from its high, narrowing its advance to 0.8% ($82.06/bbl) as greenback strength weighs on the dollar-denominated commodity.

Also of note, the financial sector (+0.1%) has climbed out of the red.

Elsewhere, the CBOE Volatility Index (VIX 15.60, +1.21) has ticked up to a fresh high, suggesting investors remain interested in volatility protection.

2:05 pm: [BRIEFING.COM] The Federal Open Market Committee has just released its latest policy statement, which, as expected, called for the final $15 billion taper, putting a stop to scheduled purchases of Treasuries and mortgage-backed securities.

As for the discussion on rates, the statement maintained its 'considerable time' language, which reinforces the expectation that the Fed will not be in a hurry to begin raising rates.

Equities followed the release by sliding to lows. The S&P 500 trades lower by 0.5%. Elsewhere, Treasuries slumped, sending the 10-yr yield to 2.34% (+4 bps). Also of note, the Dollar Index (85.73, +0.32) has spiked to a session high while gold fell to a session low. The metal is lower by 0.8% at $1220.10/ozt.

1:30 pm: [BRIEFING.COM] The major indices have been biding time for most of today's session, waiting on the FOMC announcement at the top of the hour and digesting what have been some very large gains in a short amount of time.

To the last point, the Russell 2000 is down 0.5% today after surging 9.5% off its low on October 13.

Elsewhere, it is an interesting development that the Treasury market has acted poorly even as stocks have languished today. The 10-yr note is down eight ticks and its yield has risen three basis points to 2.33%, clearing a stubborn resistance point at 2.30% that had been defended in recent sessions.

A tepid, $35 bln 5-yr note auction hasn't helped matters. It drew a high yield of 1.567% on a bid-to-cover ratio of 2.36 that trailed the prior 12-auction average of 2.72. Probably asking a little much of participants to swallow that supply an hour before the Fed issues a new policy directive.

12:55 pm: [BRIEFING.COM] The major averages trade lower across the board at midday with the Russell 2000 (-0.6%) showing the largest loss. Meanwhile, the S&P 500 (-0.2%) hovers within five points of its flat line after spending the first half of the session in a 12-point range.

In all likelihood, the range-bound action has resulted from a wait-and-see approach ahead of the 14:00 ET release of the latest policy directive from the Fed. The general consensus has all but conceded that the Fed will announce its final $15 billion taper, but it remains to be seen what undertone will emanate from the part of the statement concerned with the expected rate path. The market is poised to continue its run from the mid-October low, but an FOMC statement with a hawkish tone could throw the market for a loop.

Only two sectors hold midday gains with the energy space (+0.5%) in the lead. The recent laggard has received support from Anadarko Petroleum (APC 91.66, +1.31) and Hess (HES 83.03, +1.08). Shares of APC have added 1.4% in reaction to upbeat guidance while Hess trades up 1.3% after beating earnings estimates. Crude oil, which trades higher by 1.3% at $82.52/bbl, has also contributed to the strength.

Elsewhere, the telecom services sector (+0.2%) is the only other advancer while health care slipped into the red not long ago. Biotechnology has acted as a drag after Gilead Sciences (GILD 109.92, -3.53) beat estimates, but reported below-consensus sales of one of its major drugs.

The underperformance of biotechnology has pressured the Nasdaq (-0.6%), which also has to contend with a 5.9% loss in the shares of Facebook (FB 76.00, -4.77). The social media company surpassed estimates, but comments from the management sparked worries about increased spending and slowing revenue growth. The broader technology sector (-0.3%) trades right behind the S&P 500.

Treasuries sit near their lows after retreating steadily from overnight highs. The 10-yr yield hovers at 2.32% after adding two basis points.

Economic data released this morning was limited to the weekly MBA Mortgage Index, which fell 6.6% to follow last week's 11.6% spike.

12:25 pm: [BRIEFING.COM] Recent action saw the S&P 500 (-0.2%) slip to a fresh session low, but the index remains inside a narrow range despite that downtick.

The energy sector (+0.8%) continues holding the lead, but the growth-sensitive group has retreated from its opening high. Outside of energy, health care (+0.1%) and telecom services (+0.1%) are the only other sectors trading in the green.

Today's cautious start to the session has caused participants to hedge some of their exposure. The CBOE Volatility Index (VIX 15.49, +1.10) is higher by 7.6% after climbing off its lowest level since the start of the month.

11:55 am: [BRIEFING.COM] The Dow and S&P 500 remain little changed while the Nasdaq (-0.4%) and Russell 2000 (-0.4%) lag.

Despite today's underperformance, the Nasdaq and Russell 2000 remain ahead of the other two indices for the week. The Nasdaq has added 1.3% since last Friday while the Russell 2000 has surged 2.3% so far this week. For its part, the S&P 500 sports a week-to-date gain of 1.1%.

Yesterday, the small cap index soared 2.9% and enjoyed its best day since January 1, 2013, but today's modest pullback has the Russell trading between its 100- (1143.70) and 200-day averages (1145.76).

Elsewhere, Treasuries have slipped to new lows with the benchmark yield inching up to 2.32% (+2 bps).

11:30 am: [BRIEFING.COM] The S&P 500 (+0.1%) remains near its flat line while the Nasdaq Composite (-0.3%) continues showing relative weakness.

The tech-heavy index tried to erase its opening decline, but has been pressured to new lows by the biotech space. The iShares Nasdaq Biotechnology ETF (IBB 291.20, -2.75) is lower by 0.9% after trying to withstand the impact of a 1.7% decline in the shares of Gilead Sciences (GILD 111.54, -1.91). Despite the relative weakness in the biotech space, the health care sector (+0.3%) is among the outperformers.

As for the technology sector (-0.1%), the top-weighted group trades just behind the market while chipmakers display slight strength. The PHLX Semiconductor Index is higher by 0.1%.

10:55 am: [BRIEFING.COM] Unable to build on its opening advance, the S&P 500 has slipped below its flat line. As mentioned in one of our previous updates, the energy sector (+0.6%) is the only source of real strength while the remaining groups trade closer to their flat lines. The telecom services sector (+0.3%) also trades ahead of the broader market, but that strength is negligible considering the group is the smallest sector by weight, accounting for less than 3.0% of the S&P 500.

On the flip side, the materials sector has extended its decline to 1.6% while consumer discretionary (-0.2%), industrials (-0.4%), and technology (-0.2%) have dipped into the red. Notably, a wave of profit taking has the Dow Jones Transportation Average trading lower by 0.7% despite showing opening strength. CSX (CSX 35.32, +0.03) is the lone advancer while the remainder of the index trades lower.

10:40 am: [BRIEFING.COM]

Oil futures have been trading in positive territory all day so far and following the weekly EIA inventory data, prices received a little extra boost
Dec WTI crude oil is trading +1.1% at $82.32/barrel in current activity, while Brent crude oil is +1.4% at $87.21/barrel
Gold sold off this morning, but realistically it was a small sell-off
Dec gold has been climbing off of today's highs and are now -0.5% at $1223.60/oz, Dec silver is +0.02% at $17.23/oz
Natural gas rallied this morning, hitting as high as $3.79/MMBtu. Dec nat gas is currently +0.98% at $3.76/MMBtu
Dec copper is +0.2% at $3.10/lb

10:00 am: [BRIEFING.COM] The S&P 500 (+0.3%) continues holding a modest gain, but it is worth pointing out that the energy sector (+1.6%) is responsible for the bulk of the early advance. Meanwhile, the remaining nine groups trade in-line or behind the benchmark index.

On the flip side, the materials sector (-0.6%) is the weakest performing group even though steelmakers are showing strength after U.S. Steel (X 40.88, +2.73) reported better than expected results. DuPont (DD 66.96, -0.98) trades lower by 1.6%, which has contributed to the relative weakness.

Also of note, the industrial sector trades right behind the market while the Dow Jones Transportation Average (+0.3%) receiving a boost from C.H. Robinson's (CHRW 73.14, +0.80) bottom-line beat.

9:40 am: [BRIEFING.COM] The S&P 500 (+0.2%) hovers just above its flat line while the Nasdaq (-0.1%) lags amid weakness in two large components.

The tech-heavy index has been pressured by Facebook (FB 75.75, -5.02) and Gilead Sciences (GILD 112.37, -1.08) after both names reported earnings. Facebook beat estimates, but guided for higher spending and lower than expected revenue growth. For its part, Gilead lags amid concerns about below-consensus sales of one of its major drugs, which overshadowed better than expected revenue. The overall biotech space has held up relatively well with the iShares Nasdaq Biotechnology ETF (IBB 293.66, -0.29) trading little changed. As for the health care sector (+0.2%), the group trades a bit ahead of the broader market.

Treasuries hold slim losses with the 10-yr yield up one basis point at 2.31%.

9:10 am: [BRIEFING.COM] S&P futures vs fair value: +0.60. Nasdaq futures vs fair value: -7.00. The stock market is on track for a flat open with the S&P 500 futures trading just above fair value. Index futures have maintained a narrow range throughout the night and it wouldn't be a stretch to expect the same from the cash market with the latest policy statement from the Fed scheduled to be released at 14:00 ET.

The S&P 500 futures trade little changed, but Nasdaq futures hover about seven points below fair value with Facebook (FB 76.21, -4.56) exerting early pressure on the tech-heavy index. The social media stock is indicated to open lower by 5.6% after better than expected earnings were masked by worries surrounding the company's plan to increase spending. Furthermore, a slowdown in expected revenue growth has also presented a headwind.

In other earnings news, Dow Jones Transportation Average member C.H. Robinson (CHRW 75.00, +2.66) is on track to open higher by 3.7% in reaction to a bottom-line beat on light revenue.

Treasuries are little changed with the 10-yr yield at 2.30%.

8:57 am: [BRIEFING.COM] S&P futures vs fair value: -1.10. Nasdaq futures vs fair value: -13.00. The S&P 500 futures trade one point below fair value.

Markets rallied across Asia.

In economic data:
Japan's Industrial Production rose 2.7% month-over-month (expected 2.2%; previous -1.9%)
South Korea's Current Account surplus widened to $7.60 billion from $7.20 billion
New Zealand's ANZ Business Confidence jumped to 26.5% from 13.4%

------

Japan's Nikkei rallied 1.5% to a three-week high as trade ended just shy of the 50-day average. Robotics maker Fanuc climbed 1.7% and electronics maker Sony surged 3.1%.
Hong Kong's Hang Seng climbed 1.3% to its best level in five weeks. Casino shares saw strong gains with Galaxy Entertainment and Sands China rocketing higher by 6.3% and 5.0%, respectively, in response to strong earnings from peer Wynn Macau.
China's Shanghai Composite gained 1.5% to end just short of its best levels since February 2013. Transportation names such as China Eastern Airlines and COSCO Shipping both climbed the daily limit, 10%, on hopes of more reforms at state-owned enterprises.
India's Sensex added 0.8% and neared all-time highs. Automakers were among the leaders with Tata Motors and Mahindra & Mahindra climbing 3.5% and 1.7%, respectively.

Major European indices trade mostly higher while Italy's MIB (-0.8%) and Spain's IBEX (-0.6%) underperform. The European Commission is expected to approve French and Italian budgets after both countries made changes to their spending plans. To that point, Italy is expected to lower next year's deficit target to 2.6% of GDP from 2.9%.

Economic data was limited:
Great Britain's Mortgage Approvals came in at 61,270 (expected 62,250; previous 64,050) while Mortgage Lending increased GBP1.80 billion (consensus GBP2.00 billion; prior GBP2.20 billion)
French Consumer Confidence ticked down to 85 from 86 (expected 86)
Spain's Retail Sales rose 1.1% year-over-year (expected 0.6%; last 0.4%)

------

In France, the CAC is higher by 0.3% with growth-sensitive names in the lead. Schneider Electric, Legrand, and Total hold gains between 2.0% and 2.8%. Sanofi is the weakest performer, down 4.0%, after making cautious comments on its earnings call.
Germany's DAX has added 0.7% amid broad strength. K+S leads with a gain of 4.5%. Exporters also display strength with Daimler and Volkswagen both up near 0.9%.
Great Britain's FTSE trades up 0.8% with consumer names showing strength. Intertek Group, Tesco, TUI Travel, and Coca-Cola hold gains between 1.8% and 4.2%.
Italy's MIB has surrendered 0.8%. STMicroelectronics (-9.0%) is the weakest performer after missing revenue estimates on better than expected earnings. Financials lag with Banco Popolare, Baca di Milano Scarl, and Unicredit down between 2.5% and 3.0%.

8:27 am: [BRIEFING.COM] S&P futures vs fair value: -0.90. Nasdaq futures vs fair value: -10.00. U.S. equity futures have climbed off their lows, placing the S&P 500 futures back near their flat line. Futures on the benchmark index have maintained a five-point range throughout the night and it would not be surprising to see a similar dynamic take place during the first half of today's session ahead of the afternoon release of the Fed's policy statement.

Investors have received another heavy batch of earnings since yesterday's closing bell with Facebook (FB 74.80, -5.95) receiving significant attention. The social media stock is indicated to open lower by 7.4% after better than expected earnings were masked by worries surrounding the company's plan to increase spending. Furthermore, a slowdown in expected revenue growth has also presented a headwind.

7:58 am: [BRIEFING.COM] S&P futures vs fair value: -2.10. Nasdaq futures vs fair value: -14.50. U.S. equity futures trade near their pre-market lows amid mixed action overseas. The S&P 500 futures hover two points below fair value after slipping from their highs during the past two hours.

Today's headline event will be the 14:00 ET release of the FOMC policy directive, which is expected to call for a final taper in the amount of $15 billion that would put an end to scheduled monthly purchases of Treasuries and mortgage-backed securities. What remains to be seen is the tone of the accompanying commentary regarding the expected rate path.

Economic data released this morning was limited to the weekly MBA Mortgage Index, which fell 6.6% to follow last week's 11.6% spike. Treasuries are little changed with the 10-yr yield at 2.29%.

In U.S. corporate news of note:

C.H. Robinson (CHRW 78.00, +5.66): +7.8% after beating bottom-line estimates on light revenue.
Facebook (FB 74.48, -6.27): -7.7% after its above-consensus earnings were overshadowed by concerns about increased spending and slowing revenue growth.
Gilead Sciences (GILD 110.80, -2.65): -2.3% after below-consensus sales of one of its major drugs overshadowed better than expected revenue.
STMicroelectronics (STM 6.47, -0.75): -10.4% following below-consensus revenue on better than expected earnings.
U.S. Steel (X 41.14, +2.99): +7.8% in reaction to better than expected results.
Western Digital (WDC 90.70, -2.38): -2.6% after its light guidance overshadowed better than expected results.

Reviewing overnight developments:

Asian markets ended higher. Hong Kong's Hang Seng +1.3%, China's Shanghai Composite +1.5%, and Japan's Nikkei +1.5%.
In economic data:
Japan's Industrial Production rose 2.7% month-over-month (expected 2.2%; previous -1.9%)
South Korea's Current Account surplus widened to $7.60 billion from $7.20 billion
New Zealand's ANZ Business Confidence jumped to 26.5% from 13.4%
In news:
In Japan, Prime Minister Shinzo Abe's cabinet has raised its Industrial Production assessment after cutting the outlook earlier this month.

Major European indices trade mostly higher. France's CAC +0.1%, Great Britain's FTSE +0.7%, and Germany's DAX +0.7%. Elsewhere, Italy's MIB -0.6% and Spain's IBEX -0.5%.
Economic data was limited:
Great Britain's Mortgage Approvals came in at 61,270 (expected 62,250; previous 64,050) while Mortgage Lending increased GBP1.80 billion (consensus GBP2.00 billion; prior GBP2.20 billion)
French Consumer Confidence ticked down to 85 from 86 (expected 86)
Spain's Retail Sales rose 1.1% year-over-year (expected 0.6%; last 0.4%)
Among news of note:
The European Commission is expected to approve French and Italian budgets after both countries made changes to their spending plans. To that point, Italy is expected to lower next year's deficit target to 2.6% of GDP from 2.9%.

7:04 am: [BRIEFING.COM] S&P futures vs fair value: -1.00. Nasdaq futures vs fair value: -13.00.

7:04 am: [BRIEFING.COM] Nikkei...15,553.91...+224.00...+1.50%. Hang Seng...23,819.87...+299.50...+1.30%.

7:04 am: [BRIEFING.COM] FTSE...6,441.83...+39.60...+0.60%. DAX...9,129.26...+61.10...+0.70%.

Dollar Rises Most in 4 Weeks as Fed Ends Buying on Labor

By Andrea Wong Oct 29, 2014 5:27 PM ET

The dollar gained the most in almost four weeks after Federal Reserve officials confirmed they will end their bond-purchase program amid improved labor-market conditions.

The greenback rose to a three-week high versus the yen, while emerging-market currencies declined, as traders pushed up odds for an interest-rate increase next year even as the Federal Open Market Committee maintained its pledge to keep borrowing costs low for a “considerable time.” New Zealand’s dollar fell as the central bank kept interest rates on hold, while Norway’s krone dropped as retail sales unexpectedly declined.

“The FOMC played up the strength of the labor market, and downplayed the extent to which lower inflation expectations were likely to impact long-term inflation and by extension policy,” Alan Ruskin, the global head of Group of 10 foreign exchange at Deutsche Bank AG in New York, wrote in an e-mail. “The response has been a clear-cut stronger USD.”

The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major currencies, climbed 0.6 percent to 1,069.42 at 5 p.m. in New York, the biggest jump since Oct. 3. It earlier dropped 0.2 percent.

The greenback rose 0.7 percent to 108.89 yen and touched 108.96, the highest since Oct. 7. It rallied 0.8 percent to $1.2632 per euro after declining 0.7 percent in the previous three days. Japan’s currency climbed 0.1 percent to 137.56 per euro after reaching 138.03, the weakest since Oct. 1.

The odds of borrowing costs going up by October 2015 climbed to 61 percent, from 51 percent before the Fed announcement, based on futures prices.

EM Selloff

The prospect of higher interest rates in the world’s biggest economy hurt the appeal of emerging-market assets, with an index with equal weightings of 20 major developing currencies dropping 0.3 percent after earlier gains.

Hungary’s forint slumped 1.1 percent to 245.07 per dollar, while South Africa’s rand declined 0.9 percent to 10.9479.

The New Zealand dollar fell 1.5 percent to 78.02 U.S. cents as central-bank Governor Graeme Wheeler held the cash rate at 3.5 percent, as predicted by all 13 economists in a Bloomberg survey. The central bank signaled it will keep interest rates on hold for an extended period as inflation slows and the currency remains unjustifiably high.

The Norwegian krone dropped as retail sales shrank 0.1 percent in September from a 0.6 percent gain the previous month, data from Statistics Norway showed today. That compares with the median prediction of a 0.7 percent gain in a Bloomberg survey of economists. The jobless rate increased to 3.7 percent in August, from 3.4 percent the prior month, another report showed.

The krone slid 1.5 percent to 6.7079 versus the dollar and reached 6.7156, the weakest since June 2010. It depreciated 0.6 percent to 8.4725 per euro.

‘Job Gains’

“Labor-market conditions improved somewhat further, with solid job gains and a lower unemployment rate,” the FOMC said today in a statement in Washington. “A range of labor market indicators suggests that underutilization of labor resources is gradually diminishing,” the panel said, modifying earlier language that “there remains significant underutilization of labor resources.”

The dollar index had been headed for its first monthly decline since June on concern slowing global growth and rising risks of disinflation will spill over into the U.S., prompting traders to push out their bets on the timing of the Fed’s rate increase. Policy makers have kept their key interest rate at zero to 0.25 percent since December 2008.

“The market had a little fit in the first half of October and pushed the fed-funds expectations, the first hike, out six months,” Greg Anderson, head of global foreign-exchange strategy in New York at Bank of Montreal, said by phone. “The Fed has just come back and said they’re looking at the fundamentals and gathered everybody back to June again.”

Dollar ‘Positive’

The U.S. economy will expand 2.2 percent this year and 3 percent in 2015, according to another Bloomberg survey. The euro area will grow 0.8 percent and 1.2 percent, while Japan’s economy will expand 1 percent in 2014 and 1.2 percent the following year, the surveys predict.

The U.S. may have added 225,000 jobs this month, at just about the average monthly gain this year of 227,000, according to a Bloomberg News survey of economists before the Nov. 7 Labor Department report. The unemployment rate is projected to be unchanged at 5.9 percent, the lowest level since July 2008.

“I can see a rate hike in the first half, based on the statement and the labor metrics,” Lennon Sweeting, a San Francisco-based dealer at the broker and payment provider USForex Inc., said in a telephone interview. “The market absorbed the statement as being positive for the dollar.”

To contact the reporter on this story: Andrea Wong in New York at awong268@bloomberg.net

To contact the editors responsible for this story: Dave Liedtka at dliedtka@bloomberg.net Kenneth Pringle, Greg Storey

Special thanks to Bloomberg, CNNMoney, Reuters and Yahoo! Finance for their market summaries.

Best Regards,
M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
@ http://twitter.com/wrbtrader @ http://stocktwits.com/wrbtrader

http://www.thestrategylab.com
Phone: +1 708 572-4885
Business Hours: 8am - 5pm est (Mon - Fri)
Skype Messenger: kebec2002
questions@thestrategylab.com
Go Back To TheStrategyLab.com Homepage