See the latest Australian dollar analysis here:

Wall Street refound its lost confidence overnight as the Georgian senate races got underway as a selloff in Treasuries – sending 10 year yields nearer the 1% magical level – embiggened stock bidding, lifting the S&P500 to a new high. Oil prices surged on a post OPEC+ announcement that the Saudis would make some production cuts, while gold and iron ore rose slightly. Bitcoin was eventually able to hold on to gap higher and made a new record high yesterday, heading above the $34000 mark with the daily chart still in bubble mode:

Looking at share markets in Asia from yesterday where the Shanghai Composite was floating along towards the close but managed to lift at the end, up 0.7% to definitively clear the 3500 point level and close at 3528 points. Meanwhile in Hong Kong the Hang Seng Index followed along, lifting 0.6% to 27649 points. The daily chart is showing a great breakout that could have more legs, although as I mentioned yesterday, momentum is clearly overbought and ripe for a pullback, but support at the 26000 point level is extremely firm:

Japanese stock markets continued to fall in the wake of a stronger Yen, the Nikkei 225 losing another 0.35% to finish at 27162 points.. Futures are suggesting a stop to the selloff with mild upside, but the stronger Yen is still weighing here, with the potential for a proper pullback to or below 27000 points still a consideration:

After gapping down at the open by over 0.5% the ASX200 eventually finished with a scratch session, closing only 0.1% lower at 6681 points. SPI futures are supportive of some potential upside today although the daily chart remains in a sideways bent without much upside potential yet, so we still need some better momentum readings before getting too excited:

European markets were under pressure again, although the non-European FTSE is still bouncing despite the lockdown, up 0.6% while the German DAX pulled back to finish 0.5% lower at 13651 points. The higher Euro weighed on markets here with the surging Wall Street not helping post close futures much at all. I still contend we require another solid push above the previous highs above 14000 points, as daily candle price action is not yet convincing:

Wall Street finished with new record highs as the Georgia special elections pointed somewhat to a Democrat victory (gun company stocks surged….what a world). The S&P500 closed 0.7% higher to 3726 points and while the four hourly chart remains volatile, its still on trend as this swing trade is filled in. I still remain skeptical of a proper fill as we look through the elections and onto Trump’s removal:

Currency markets are seeing reduced volatility as volumes start to increase post NYE, with the latest US ISM PMI exceeding expectations and sending the USD lower against most of the majors. Euro lifted and nearly matched its previous session highs just below the 1.23 handle in what looks like a buildup to a breakout, with support firming at the low moving average near the 1.22 mid area:

The USDJPY pair however remains in a rut with more Yen buying sending the pair down to a new weekly low, still retracing well below key support at the December lows, and staying below the 103 handle throughout the whole session. The downward trajectory continues as four hourly momentum remains quite negative, with the February extreme lows nearer the 100 handle at parity possible in play here:

The Australian dollar joined in the USD melee with a big surge up through the mid 77 level to a new monthly high, helped by the buoyant mood in commodity prices. This has been a great test of support at the 77 handle proper as momentum picks up in the short and medium term with a probable charge at the 80 cent level firming each day:

Oil surged on the Saudi cut in the wake of the OPEC+ meeting, with the Brent crude contract up more than 3% to finish at the mid $53USD per barrel level, almost matching the pre COVID February 2020 level (upper horizontal black line). Medium term support is firming here obviously and the proper breakout above the $52.50 area that I’ve been mentioning for awhile is indeed confirmed:

Gold is still moving higher, albeit at a more sustainable pace, lifting up to but not through the $1950USD per ounce level overnight. I still contend that a small retracement is coming but the nominal November high at the $1970 level is still the overall target in this move:

Glossary of Acronyms and Technical Analysis Terms:
ATR: Average True Range – measures the degree of price volatility averaged over a time period
ATR Support/Resistance: a ratcheting mechanism that follows price below/above a trend, that if breached shows above average volatility
CCI: Commodity Channel Index: a momentum reading that calculates current price away from the statistical mean or “typical” price to indicate overbought (far above the mean) or oversold (far below the mean)
Low/High Moving Average: rolling mean of prices in this case, the low and high for the day/hour which creates a band around the actual price movement
FOMC: Federal Open Market Committee, monthly meeting of Federal Reserve regarding monetary policy (setting interest rates)
DOE: US Department of Energy
Uncle Point: or stop loss point, a level at which you’ve clearly been wrong on your position, so cry uncle and get out!
- Macro Afternoon - January 15, 2021
- Macro Morning - January 15, 2021
- Daily iron ore price update (record imports) - January 15, 2021
on the BBUS again. 😒
Swung my SAR to SVL at beginning of the week will wait and see 🙂
if market corrects I will buy NST. Below $11 I hope.
My portfolios are doing extremely well, way ahead of the general market….
But my new rules-based hedging strategy has me currently with some large pro-active hedging positions…hmmmm…interesting signals…
I don’t think a crash is on the cards, but a good solid correction might be (5-10%)…?
well done mate. I just feel better to seat on the fence for while.. EU is shutting down and US is in trouble again. If we get 10% correction I will be buying again. The shear stimulus may not allow proper crash but all this shutting down will have impact on numbers and markets. March or Apr perhaps.
Makes sense.
I’d honestly be similar except that I’m sick of trading so often, and FOMO got to me…
So I compromised, have all-in most of the time, and aggressively buy hedges whenever a trigger is reached.
Less trading for me, and it’s worked so far….we’ll see…
And…there it goes, down…
54% of the votes counted and both Dems lead. If they win market will expect tax hikes so there will be massive sell off first.
If that happens there will be buying opportunities.
wow.. 59% reported and race is now tight.
Banter Appreciated chaps, it’s good to read & more interesting to bet on themes or stories than FX instruments. Burbs, I’ve got to ask – Do you hedge with derivatives (CFD’s, Options) or inverse ETF’s?
I prefer VIXY when it’s cheap and then profit taking from a strategic standpoint these days; easier to realise return given we have bounces rather than curves these days.
Is there a simple ASX product that does this, for simple plebs like me?
Sorry no; the Australian ETF space is rather sparse compare to the US.
https://www.marketindex.com.au/asx-etfs
I told you to buy Cliffs
yes you did, but I don’t want to be told what to do. 😁
And reduced my exposure in everything by a lot. In the past my instincts served my right and again I start to be scared. Despite gold and copper having very bright long term future if market corrects all miners will be dragged down.
If I am wrong I still have some exposure to NCM (decent one) and some in ALK. Very small positions in CEL and PXX.
Sold the rest.
Thanks for sharing Niko .
“Australia to toughen export controls over fears technology could fall into hands of foreign armies https://t.co/ma4KlDwW5x ‘Coalition backbenchers pushed for the inquiry after The Australian published reports about a Chinese research program.’ #MurdochRoyalCommission #auspol”
Coalition, now there’s a skanky party only Reusa could love
https://twitter.com/CartwheelPrint/status/1346604805112778752?s=19
Georgia poll has closed. Dem ahead right now, but I don’t expect it to last long.
The protests or the civil war starting ?
Looks like the Republicans will get at least one seat.
Most of the votes outstanding are from strong D areas so reasonably good chance of them getting both seats:
https://www.nytimes.com/interactive/2021/01/05/us/elections/forecast-georgia-senate-runoff.html
Dave Wasserman calling a win for Warnock – https://twitter.com/Redistrict/status/1346647684900417536
Atlanta will be the key
My call is the Republicans will get one seat and the stock market euphoria will continue !
could be. The Big Man needs both seats so Dems can push $7tn stimulus through. If Rep get one senator in then stimulus package will be lot smaller and lot less greener.
Despite Georgia race looking tight it seems Dems can win both seats once votes from the big cities are counted for. Not sure why these votes are left for last though.
Stop the vote, stop the vote…
Cities have much larger populations so more votes to count in batches. Also more early voters presumably which only get counted on the day.
But in the alt fact world it will be due to dead/illegal voters and/or fake ballots
stop the vote, stop the vote…
According to MSNBC one large batch of votes will be released from Atlanta area anytime now.
Yep. Also most R areas underperforming presidential levels more than dem. When your voters think its rigged they won’t vote. Who could have thunk it?
Looks like both seats going to Dems…
Trump is rage tweeting of course, meanwhile the Trumpists are finding ratholes to scurry out of.
they just released big batch now and yes. Look at US Treasuries.
Agree Chris looks like my one all prediction is dying a slow death, let the market carnage begin .
Recounts all round me thinks.
Recounts will be the start, the GOP will try everything to have this election overturned – look at what they’re doing in PA.
Fun couple of days ahead.
I for one am enjoying this on the sidelines. 2021 is going to make 2020 look like a picnic.
Nothing like 2016-19 where the Democrats denied the election result.