Santa Rally On Its Way
Is the Santa rally on its way or is this just an overreaction to some bad news that investors think is good news?
For a long time now, the narrative of “bad data = good news” has allowed equity markets to rally. However, Rory shares in the app and talks about it on todays podcast that over 75% of major data last week was negative. yet the market takes it as a positive.
While that may mean the Fed are not going to hike as much if at all, it does mean there is a deterioration within the economy and it’s why Rory says he is exercising caution within the equity space right now.
Jonathan discusses the increase in volatility throughout the markets, most notably the fall of the Dollar & the rise of stocks has changed the perspective for now & it’s time to reassess.
This week is quite on economic front, with the exception of Powell’s speech, which may allow the markets to digest last weeks data & offer a clearer picture for the longer term direction of the markets.
Jonathan shares his thoughts around the DXY and notes that many Dollar pairs such as GBP and EUR are all moving higher and taking advantage of this recent dollar weakness. We will have to wait until next weeks CPI report for further clarification of dollar positioning.
Speaking of taking advantage of dollar weakness, Gold failed to do so, still hovering shy of $2000 not able to break higher despite the sell off in USD. Both Jonathan and Rory agree that if gold can’t move higher now, what will make it move higher? It perhaps doesn’t look as attractive as other trades such as FX or the fixed income space.
Crude oil rose to nearly $83 on Monday morning trading but remains under pressure despite Saudi Arabia confirming an extension of its 1 million barrels per day additional voluntary production cut until the end of December, while Russia said it would continue with its additional voluntary supply cut of 300,000 bpd from its crude exports as well.
Finally, we have another busy week of earnings. Rory has shared the economic calendar and earnings calendar within the app, along with Jonathan and Adam, who are posting their daily analysis on the markets.
Rory McMullan- Host
Rory is a final year student studying Accounting and Finance in London, He started his trading journey over 2 years ago but has came quite far in the process. He traded most asset classes starting with FX and Commodity trading, trading crack calendar spreads within the energy market to now running his own Long/Short equity options portfolio. The book that he trades is a systematic, top-down bottom up equity portfolio.
Rory has a strong passion for the financial markets and really hopes he is able to be of assistance to anyone either starting their trading journey or looking to further their knowledge.
Jonathan Farrelly – Host
Jonathan started his trading journey over 15 years ago, learning from some of the best institutional traders in the world.
Over the last 9 years Jonathan has taught 1000’s of retail traders how to successfully navigate the financial markets.
He has evolved Two Blokes Trading with new technologies to offer traders a new fully immersive experience.
Jonathan’s ethos has always been based on transparency with the goal to help new & experienced traders achieve their goals.