Macro Afternoon

See the latest Australian dollar analysis here:

Macro Afternoon

A big breakout in Bitcoin is dominating the market wires this afternoon as Asian stock markets continue to rally as risk sentiment improves, despite the woeful mishandling of Brexit overnight in the UK parliament.  The RBA meeting came and went with no change except in language which saw the Aussie dollar fall below 71 cents and bond markets to rally.

This crypto breakout cleared the daily highs at the $4100 level that I mentioned in late February was the key area to watch, with the next upside target at $5700-6000:

The Shanghai Composite is slowing down into the close to be up 0.3% to remain above 3170 points, while the Hong Kong Hang Seng Index is also a little weaker, up only 0.2% to 29613 points. This keeps it just above the previous high as momentum remains ready to push the market towards and hopefully above the 30,000 level:

US and Eurostoxx futures are falling slightly going into tonight’s session with the four hourly chart of the S&P 500 looking to hold above its breakout level at the previous week highs at 2860 points:

Japanese stock markets are losing a little headway here despite the much lower Yen overnight, with the Nikkei 225 looking to close only a few points higher, currently at 21538 points and looking to consolidate after making a new substantial daily high to start the week yesterday. The USDJPY pair launched above the 111 handle last night and has remained there pretty much all session and will try to make it a new three week high tonight with momentum nicely overbought:

The ASX200 is the best performer this time, up 0.4% to 6242 points, remaining well above staunch resistance at 6200 points helped by the neutral but really dovish RBA stance. The Australian dollar flopped on the non-decision this afternoon, falling straight below the 71 cent level and heading towards the lower uptrend line which has held since the March lows:

The economic calendar has one major release tonight, the US durable goods order for February plus the usual fallout from the Budget in Canberra.

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  1. AFR journo doesn’t even know what a basis point is:

    “House prices fell by about 7 basis points in March, to be down about 9 per cent from the peak.

    In Sydney, prices fell by about 9 basis points in March, or nearly 14 per cent from the peak. Melbourne prices slipped about 8 basis points for the month taking the slide since the peak to more than 10 per cent.”

  2. AUD smashed by 0.9 %. The tea leaves say it’s heavily oversold. Only upside from here for the next few days. BUY BUY BUY!!

    • The Traveling Wilbur

      It’s gone up about 50000 points (hopefully I got that right) in the last 24 hours!

      Edit: wrong spot. Supposed to be about BTC above.

      If it tripples in value from where it is now, some of my coworkers will break even on when they bought in! Well, almost.

      And that’s not considering opportunity-cost.

      • GeordieMEMBER

        Who even knows what opportunity cost is, let alone considers it when making investment decisions? Pfft! 🤣

    • ErmingtonPlumbingMEMBER

      “Questions over a French submarine deal made in 2002 when he was defence minister dogged the new PM . It was alleged that some $130m in kickbacks had been paid as part of the $1.2bn deal – which Mr Najib (Malaysian Prime minister) has always denied.”

      Ding Ding Ding Ding Ding!

    • ErmingtonPlumbingMEMBER

      Both Countries had/have Goldman Sachs people in and near high places.

      I wonder who was considered the “Bigger Man” or the “Greater Knight of Global plutocracy” in the Goldman Sachs alumni before Timothy Leissner WAS suspended,… Turnbull or Leissner?

      “This slick German banker represented one of the world’s most powerful financial institutions, Goldman Sachs, at a time that the bank was charging into Asia.

      In the aftermath of the 2008 financial crisis, Timothy Leissner’s deal-making in South East Asia (Malaysia in particular) netted the bank significant revenues and he rose to become the company’s chairman in the region.

      But the biggest deals would come when he crossed paths with Jho Low – alleged to be the power player behind 1MDB.

      Goldman had previously rejected Mr Low as a client, after compliance officials raised concerns about the source of his money. But, according to a US indictment, Mr Leissner and another Goldman banker, Roger Ng, used Mr Low’s powerful connections to obtain business for Goldman.

      The bank is alleged to have earned an eye-popping $600m in fees for arranging and underwriting three bond sales to raise $6.5bn for 1MDB in 2012 and 2013.

      Mr Leissner has pleaded guilty to US charges of conspiring to launder money and violating anti-corruption laws by bribing foreign officials.

      Goldman’s role in the 1MDB scandal in 300 words
      Goldman boss: ‘We apologise to the Malaysian people’
      Malaysia has also filed charges against him, Mr Ng and Goldman Sachs itself. Mr Ng, who left Goldman in 2014, denies all the charges against him.

      Goldman Sachs, which denies any wrongdoing, called the charges “misdirected” and vowed to “vigorously defend them”. It has sought to portray Mr Leissner, who it suspended in 2016, as having gone rogue and has apologised for his behaviour.

      But the Malaysian government has rejected the apology and called for the bank to cough up $7.5bn in reparations.”

      • As leading Australian public intellectual Bananarby Joyce once said, Western civilization is always looking for a crisis to obsess about

    • interested partyMEMBER

      The shills who argued the opposite have all gone very quiet.
      Meanwhile…….about 1000mm of rain has fallen here in the Douglas Shire in the last 3 weeks. An old time, typical, wet season month of march. First good wet for many years.

    • System collapse here we come.

      The other day I found out that the annual wobble of the world from vertical for its spinning axis is majorly contributed to by seasonal factors like the displacement of air and water masses. That polar system over the arctic that gave up for a while last year is one of these major influences. So, as anthropomorphic climate disruption occurs other major parts of the Goldilocks state of Earth that we, and many other species, have evolved to survive in get thrown out of whack. This leads to more disruption and the troubles grow bigger. It ain’t just temperature, or CO2 levels. It’s the whole shebang because it is all interconnected. Biosphere, atmosphere, hydrosphere and lithosphere. We’re Frydenberging everything. Maybe Perry was right, maybe martians could do better than we’ve done.

  3. GeordieMEMBER

    What constitutes an AUD breakdown given the current trend? A dive below 0.7050 or there about?

    • I’m no chartist but as a guess … In the very short term, looks on CB’s chart like anything that sticks below 70.70… in the long term anything below 70.00!

      • Poking its turtle head below 70.69 but it’s not sticking… sticky old poo trying to keep above the waterline…

  4. proofreadersMEMBER

    Just listening to the fairy tale about the drover’s dog budget surplus from Herr Howard’s youth brigade.

    • proofreadersMEMBER

      I was torn between LOL and vomiting listening to Josh FrydenBradbury – however, I could not reconcile how Fixer Pyne, Kelly O’L, Jimmy Choo Julie etc etc would not want to keep living the dream of the LNP nirvana.

    • I’m refusing to lower myself to watching poorly scripted reality television fronted by talentless fame hunters so I’m .spending my evening with MAFS.

  5. So treasurer says we will spend more, collect less tax, cut no services and end up with more money and pay off all our debt. Is his calculator broken?

  6. The Traveling Wilbur

    Wayne Swan has a better chance of *actually delivering a real f’ing budget surplus* next year than Frydenburger does. Projected surplus? Projected?!

    How dumb do they reckon the average Australian voter is?

      • Mining BoganMEMBER

        I read on another blog that you can tell the probable IPA member journalist by the amount of times they say “delivered a budget surplus”.

        *waves at Fran Kelly*

    • It’s interesting that he didn’t fiddle with the books this year to get a surplus for 2019. As it is the forecast is for a cash deficit of “only” $4.1b for the 2019 year – half of of which is caused by measures announced tonight.

      • Like the Government itself, it’s a surplus built on deception. From the ABC:

        Around $1.2 billion previously was earmarked to be paid into the Local Government Financial Assistance Fund. Instead of paying that next year, the Government generously has opted to go early, transferring it to this financial year. The net effect? It pumps up the projected surplus. And let’s not forget that, in two years’ time, the surpluses will be inflated by earnings from the Future Fund. Of the $11 billion projected surplus, about $5.2 billion will come from Future Fund earnings. That’s a little under half. And then there is the magical cut in costs that have been identified since the half-year update just before Christmas. Somehow, over the next four years, more than $28 billion will be stripped out of spending. That’s more than half the expected surpluses. Where do they come from? Lower GST payments to the states, a decrease in disability payments under the NDIS, less cash for seniors support among others.

      • The Traveling Wilbur

        The Business host put that NDIS part of the question in even less flattering tone to the IllBeChargedBack Minister.

        He said, and I’m quoting, that it wasn’t true.

        It’s amazing how you both managed to manufacture the same ‘lie’ independently.

        Well spotted btw. Most journos seem to have missed all that. And the fact this is not a f’ing surplus budget.

        The FrydenUp – the thing you’re not having cause it’s up next year and you know it’s not happening then either.

        Happy marriage.
        Compensation from your bank, church, aged care facility.
        Flammable cladding rebate.

        No end of FrydenUps all around us.

  7. You blokes/ladies are gonna love this.

    When controversial property developer Jean Nassif gave his wife a bright yellow Lamborghini, he got plenty of attention on social media, but probably not for the reasons he wanted.

    • I don’t understand women’s obsession with the fake lips, fake cheeks, fake lashes, fake makeup. I have seen mannequins that look more lifelike.

      • The Traveling Wilbur

        It’s pretty simple really. Most Australian women want to look different to how they see themselves (as far as the cohort your characterisation above applies to).

        I.e. Thinner. And Intelligent.