An ominous title this week from the guys which i pick up on below and in my mind is centered around Europe once again.
Markets wise, another week rolls by with the guys clearly getting this equity mild retrace correct, so far. The risk on bullish bigger picture remains as was so we should be looking for entries rather than looking for shorts. The big technical debate must continue on the major pairs inc clearly the all important US$ but also the EURGBP pair and as Fitzpatrick mentions the EURCAD also is looking for clear direction here. On the big reflation question and whether we are truly off here, when rates remain so low, we must remember that wars (physical and trade) are very inflationary and therefore very good for commodity prices.
We are already into Easter holidays where I am so without more delay i bring you this weeks reports.
And here Fitzpatrick at Citi.
Fitzpatrick right on track with the risk on rally inc commodities but seeing much more strength from the US$, never mind the long term inverse correlation between the two.
And here SC on the FX side:
And here Commerz with some excellent longer range charts on the Bullion:
CB-BullionWeeklyTechnicals12042017
Finally we are above the 200dma. US inflation expectations are rising but the US$ remains strong. War risks are rising and equities are continuing to take a breather so we can put the pieces together to understand golds recent relative strength. We must keep watching the correlations with other instruments to spot the entries. Given the resistances and supports are nice and clear for now.
Macro wise, we have recently started to see European macro data continue to roll over a little. Growth is once again start to falter it seems in the Euro area across manufacturing and inflation data which is a marked contrast to the US. It remains to be seen if this is a blip or is something more meaningful. Investor sentiment continues to improve in the euro zone clearly offsetting the slightly disappointing data, for now. China continues her recovery.
Here WF
For my own book new record highs continue to roll through due to bullions renewed strength and such a mild equity retrace. We make hay whilst the sun shines as for sure stormy weather will come.
Finally, all the best guys and have a wonderful holiday season where ever you are the world. Spare a thought (and a dollar or ten) for those less fortunate than us.
Best wishes
Rich
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