Wakeup Call: Market Embracing Risk, But Not Much Data Today
We have a 'buy-on-dips' stance for equities, but expect the EURUSD to remain low.
Calendar
| Economic Data Releases |
| Country |
Time (GMT) |
Name |
Saxo |
Consensus |
Prior |
| UK |
09:30 |
Total Trade Balance (JAN) |
|
-£3000 |
-£3262 |
| GE |
10:00 |
ECB’s Weber speaks in Frankfurt |
|
|
|
| US |
12:30 |
NFIB Small Business Optimism (FEB) |
|
90.0 |
89.3 |
What's going on?
Credit spreads are continuing to narrow and our Corporate CDS price index dropped again this morning. VIX is still below 18 so risk-appetite is present, but EURUSD is having a hard time rallying and we thus have a sell-on-rallies stance on the cross.
Hardly any data today, so markets are likely to stay quiet and we have a “buy-on-dips” stance on equities.
API/DOE inventories out today and the last weeks have been showing some large builds with Crude Oil rallying more than 10%. We thus have a bearish stance on Energy today.
FX
| FX |
Daily stance |
Comment |
| EURUSD |
0/- |
Sell rallies to 1.3640 for a test of 1.3550. Stop abv 1.3683. |
| USDJPY |
0/+ |
Look to buy dips to 89.75 for a rebound back to 90.50. Stop below 89.35. |
| EURJPY |
0 |
Expect consolidation between 122.20 -123.20. Slight preference to play from short side. |
| GBPUSD |
0/- |
Sell rallies to 1.5050 for a test of 1.4945. Stop abv 1.5093. |
| AUDUSD |
0/- |
Sell break below 0.9080 for a retracement back to 0.9020. Stop abv 0.9123. |
Equities
| Equities |
Daily stance |
Comment |
| DAX |
0/+ |
Buy on dips towards 5860 targeting 5887. S/L below 5846. |
| FTSE |
0/+ |
Buy on dips towards 5582 targeting 5603. S/L below 5570. |
| S&P500 |
0/+ |
Buy on dips towards 1133 targeting 1137. S/L below 1131. |
Futures
| Commodities |
Daily Stance |
Comment |
| Gold |
0/- |
Sell at the break of 1118 and target 1106. Stop above 1124. |
| Silver |
0/- |
Sell at the break of 17.09 and target 16.90. Stop above 17.20. |
| Oil (CLJ0) |
0/- |
Sell at the break of 80.75 and target 79.50. Stop above 81.25 |
FX-Options
| EURUSD |
Front end vols offered with spot settling back down towards 1.36. Gamma is likely to continue to come under pressure. |
| USDJPY |
Spot rally shows no follow through and with the 90 level being sticky, vols should come under pressure. Feeding through to softer vols on other yen crosses as well. |
| AUDUSD |
Vols unable to rally and the market seems to be rolling atm strikes further out the curve. Main focus will be the RBNZ rate decision followed by employment report on Thursday. |
Saxo Bank
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