Friday, July 7, 2017

Guide for Stock Trading next week: T-Bonds, FED Speaks, CPI

After this beginning of the month where the fluctuations and correction of the Nasdaq-100 QQQ and the increase in bond yields marked the path of the market, other events and factors will be the new protagonists of this exciting week. Attention to:


Treasury Bonds


To the usual weekly auctions of bills are added this week the major auctions of 10-yr notes and 30-yr bond, which move this market, specifically the futures /ZN and /ZB, both in weekly decline as they follow the price of the bonds , inverse to the yield. In addition, the Mortgage Requests Index MBA complements this important week for fixed income assets. Although today there was a correction (German Bund included) because of the profit-taking of investors, I believe that the yield increase of these Treasuries will continue, except Yellen change of tone, because the conditions, fundamental and technical, are given .



FED Statements


Several statements by FED members this week (Brainard and Kashkari among them) and on Wednesday the head of the FED, Janet Yellen, who will move the world markets when she comments on growth, rates, inflation, the US tax debt and when the following rate could be given Hike We will see if she confirms her hawkish thought that shows since the beginning of the year, and as in previous times, the tone of your message will be the key.


The FOMC members. Who is who: hawkish and dovish.


Consumer Price Index


The inflation data CPI will be decisive to clarify the path that the FED can follow. The dismal data of last month (-0.1%, expected on Friday + 0.2%) made rethink everything that was done in 2017 and questioned whether it was necessary to have given the Rate Hike in June, here I thought it was not the moment. Attention that day to the TNX rate and etf like TLT or TMV to do swing trading.


Tomorrow complement with other assets to follow this week, and during the week I will be deepening them.

Econoday summarizes weekly all economic activity in the US and the world. Not mentioned above also highlights the PPI data, prior to inflation, and Industrial Production.
.