majicktrader

majicktrader

On the back of growing demand out of China (50% of global demand), Asia recovery and general optimism from Vaccine news, Copper has reached record levels that haven't been seen since June 2018. Last night's U.S. manufacturing in November saw the quickest pickup since September 2014, driving expectations of higher base metals demand in the US for next year. Low...

majicktrader

Weighed down by $100billion worth of QE, yields on the Aussie 10 Year Government Bonds have risen, but not as fast as their kiwi counterparts. NZ 10 Year yields have today risen past AU 10 year yields for the first time since July, sending the NZDUSD to within a hair's breadth of 0.70c (0.6994). With the NZD outlook brighter, and a less dovish RBNZ, No doubt the...

majicktrader

News that a vaccine in the horizon has spurred the price of crude oil, which has rallied sharply off November lows to be within reach of $44.00 USD a barrel. Hopes OPEC and its allies will delay a planned increase in oil output are also contributing to the rally, along with rising demand in Asia and a drop off to record high inventory levels. OPEC is due to...

majicktrader

Many commentators are speculating that Gold will rise during 2021 against a weaker USD. That certainly is one prospect. Another prospect is that as US 10 Year Treasury Yields rise, Gold will become a less attractive and we may see demand drop. US 10 Year Yields have already crept up to near 1%, before fading back to around 0.90%. Certainly the higher yields are...

majicktrader

Thanks to a more hawkish RNBZ, a recovering NZ economy and a weaker USD, the NZDUSD is fast approaching the 0.70 level. The kiwi hasn't pushed above 70c since the June 2018. Depending on how things play out over the next few weeks, with the Fed and US stimulus, its possible that the Kiwi exploring new territory during December.

majicktrader

The DXY has been here before close to the 92.00 level, it dipped briefly below on 1 September and recovering back to 94.00. This time, election uncertainty has been removed, Covid vaccines are on the horizon, even though cases are rising. So will risk off news tip the DXY back to safehaven role, or will it slip down under the 92 level?

majicktrader

While RBNZ had negative rates on it radar for 2021, NZ10 Year Yields were around 0.555-0.6. With the RBNZ saying the economy is doing better than expected, holding rates and generally being more hawkish, yields have climbed to their highest since July hitting 0.909%. Meanwhile the RBA has cut rates, although this initially dampened AU 10 Year yields, they are back...

majicktrader

With the RBNZ moving to a more hawkish stance in November, NZ 10 Year Bond yields have surged to highs not seen July. This all bodes well for a stronger NZD against the USD.

majicktrader

AU10YR dropped rapidly to 0.770 following the RBA's announcement but has not dropped to earlier lows in the month. The effect on the AUDUSD was a little softness, but as the market was fully expecting the move, there was nothing too drastic. Now that's out of the way, the next hurdle is the US election which influence which way the AUD heads over the next few weeks.

majicktrader

While historically Gold Prices and the $Aussie have been correlated, since early 2019, the correlation has unwound.

majicktrader

The strength of the Aussie Dollar is partly driven rising resource prices including rising Copper Prices.

majicktrader

A rise in Treasury yields, indicates a drop in Treasury Prices. Since Bond prices and equities are typically positively correlated, a rise in yields (or drop in prices) is a bearish signal for Equities.

majicktrader

What happens when banks are the largest part of your index...

majicktrader

Since February this year, the AUDJPY and S&P E Mini futures appear to work in Sync. Actual Correlation is 0.736 and these instruments show the strongest correlation with the S&P over 10Year Yields =0.609 Copper = 0.421 Bitcoin = 0.493 Gold = 0.164 The correction doesn't hold over a long time frame, but is more a marker of a market in recovery mode.