Friday October 14, 2005 - 11:42:59 GMT
Share This Story
Black Swan Capital - www.blackswantrading.com
Guess that Chart
•Annual growth in China's money supply at the end of September hit its fastest pace in nearly 1 years - a clear sign that the government has eased up on credit controls to keep the economy humming along briskly. (The Standard)
•A committee in Japan's upper house approved privatization of the postal service on Friday. (WSJ)
Key reports due today (WSJ):
8:30a.m. Sept. Consumer Price Index. Consensus: +0.9%. Previous: +0.5%.
8:30a.m. Sept. Consumer Price Index, Ex-Foor & Energy. Consensus: +0.2%. Previous: +0.1%.
8:30a.m. Sept. Retail Sales. Consensus: +0.4%. Previous: -2.1%.
8:30a.m. Sept. Retail Sales, Ex-Autos. Consensus: +0.8%. Previous: +1.0%.
9:15a.m. Sept. Industrial Production. Consensus: -0.4%. Previous: +0.1%.
9:15a.m. Sept. Capacity Utilization. Consensus: 79.4%. Previous: 79.8%.
9:40a.m. Mid-Oct. Univ. of Michigan Consumer Sentiment Index. Consensus: 80.0. Previous: 76.9.
8:30a.m. August Business Inventories. Consensus: +0.1%. Previous: -0.5%.
The pursuit of gain is the only way in which people can serve the needs of others whom they do not know.
Friedrich von Hayek
TGIF and it’s time to play “Guess that Chart.” Many of our new readers haven’t had a chance to play this game—don’t worry, it’s easy. We provide you with two price series unmarked on the chart on the next page—you scratch your head, think about it, cogitate a bit, and guess. It’s as simple as that. Ready? No cheating! Here we go:
Chart: US $ Index vs. S&P 500 futures (inverted)
As the US stock market deteriorates, the dollar rallies, seems the implication from this. Something to do with interest rates we suspect—but then again, what avoids the grasp of rates in the financial world!
Here is a chart of the S&P 500 futures—maybe a near-term bounce is in order. But it sure seems there is ample room for stocks to swoon.
Chart: S&P 500 futures
…and a weekly chart of the US dollar index vs. Fed Funds futures (inverted) shows the buck moving with rates:
Chart: US dollar index vs. Fed Funds futures (inverted)
So, if the Fed keeps hiking, and stocks keeping falling, these charts imply the dollar keeps climbing.
But as we know, correlations work until they stop working.
Big news on the inflation front out today—it could be a wild Friday, so be careful out there.
Black Swan Capital
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."