Wakeup Call: Sell On Rallies

Daily Forex Fundamentals | Written by Saxo Bank | Nov 19 08 07:35 GMT |

We would sell into rallies in commodities and stocks. Calendar Economic Data Releases Country Name Time (GMT) Expectation Prior Comment UK Bank of England Minutes 09:30 US CPI YoY (OCT) 13:30 4.0% 4.9% US Housing Starts (OCT) 13:30 780K 817K What's going on? Several of the EM sovereign fixed income CDS prices are continuing to go higher. That's a negative sign. Our global Top100 stocks CDS index is unchanged around 100 bps., i.e. still very elevated. Also negative. More talk about a devaluation of the RUB as Russian FX reserves are being drained at a rapid pace. Also watch SGD. Stocks: Relatively quiet session yesterday with small gains in the US and in Europe. Asia slightly down. We maintain a bearish stance. A lot of focus at auto makers these days. Wagoner says that letting car makers fail would be a catastrophic collapse for the US economy. FX FX Daily stance Comment EURUSD 0 Nervous market, range constricting. Sell <> EURJPY - <> USDJPY 0 Rangy. 96.00 needs to go for more downside. Resistance around 97.20-40 GBPUSD 0 1.4900 key support and 1.5090 key resistance. Waiting for break… AUDUSD 0/- Neutral now, but looks ugly if 0.6350 falls. 0.6600 is upside break level Equities Equities Daily stance Comment DAX - Sell on rally. Target 4546. S/L at 4460. FTSE - Sell on rally. Target 4115. S/L at 4224. S&P500 - Nasdaq100 - Nikkei225 - Futures Commodities Daily Stance Comment Gold (XAUUSD) - Sell around 737-740. Stop above 745. Target 725. Silver (XAGUSD) - Sell around 9.60 with a stop above 9.72. Target 9.30 Oil (WBSZ8) 0 There could be technical reasons for a bounds, but fundamentals still shaky. Analysis Disclosure & Disclaimer Saxo Bank A/S shall not be responsible for any loss arising from any investment based on any recommendation, forecast or other information herein contained. The contents of this publication should not be construed as an express or implied promise, guarantee or implication by Saxo Bank that clients will profit from the strategies herein or that losses in connection therewith can or will be limited. Trades in accordance with the recommendations in an analysis, especially leveraged investments such as foreign exchange trading and investment in derivatives, can be very speculative and may result in losses as well as profits, in particular if the conditions mentioned in the analysis do not occur as anticipated. Saxo Bank utilizes financial information providers and information from such providers may form the basis for an analysis. Saxo Bank accepts no responsibility for the accuracy or completeness of any information herein contained. Any recommendations and other comments in Saxo Bank's analysis derive from objective fundamental macro economical and company specific calculations, statistical and technical analysis, and subjective general market assessment. If an analysis contains recommendations to buy or sell a specific financial instrument, such recommendation should be seen as Saxo Bank's opinion that the specific instrument will respectively outperform the relevant market or underperform compared to the market. Saxo Bank's recommendations should statistically correspond to an even distribution between buy and sell recommendations. The recommendations may expire promptly due to market volatility and in general, Saxo Bank does not anticipate its recommendations to be valid more than one month. An analysis will be updated if and only if a market development or other issues relevant to the analysis render a new analysis on the same topic relevant. Saxo Bank's analysis does not cover any specific financial product over time but only products which Saxo Bank's strategy team finds it important to cover at any given point in time. In order to prevent conflicts of interest, Saxo Bank has established appropriate business procedures, incl. procedures applicable to research and analysis to ensure objective research reports. Saxo Bank's research reports have not been discussed with the parties, e.g. issuers of securities, mentioned in the analysis. Saxo Bank is under supervision by the Danish Financial Supervisory Authority. Saxo Bank does not engage in corporate finance activities and accordingly, Saxo Bank's employees, incl. the persons responsible for an analysis, do not receive remuneration associated with investment banking transactions.