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Surplus

Wheat market is now at the weakest stage. Time to short.We are long the PUT options since 535 - we wanted to limit our risk. Now it is safe to short the futures, as the market is very weak technically and fundamentally. Sell on a CLOSE below 492.25, stop loss on a CLOSE above 507. 435 is the price target. I have been travelling around the wheat region in Russia last week - observing the crops, talking to farmers. Planted area this year is very large and most of the crops survived and are looking healthy. Weather conditions are excellent. Prices as low as 416 and 381 could be reached if we see our preliminary target reached before August 31. *Please remember that futures trading involves a substantial risk of loss and is not suitable for all investors.
CBOT:ZW1!Short
by CSInvestment
5
SPX - Federal Tax Receipts - Deficits Set to Explode! TL;DR: What this means, in simple terms, is that the US debt is already at nose bleed levels and has been PRIOR to the global shutdown, the shutdown just making it worse and is impacting the stock market, which is a big driver for US receipts, this in turn with push the deficit higher, i am anticipating deficits that are at levels seen in the GFC (10% or higher) and i expect those to continue for quite some time. To better understand why the Fed and the US government are pulling out all the stops to "save" the markets, one first must first begin to understand the incestuous relationship between the financial markets and the US government. Now, that is a long, long story, far too long for here and certainly not on this medium. But, this chart summarizes the relationship quite nicely: This is the SPX (blue line) overlaid with the US federal receipts (US income) and the lower baseline chart is the surplus (green) or deficit (red) expressed as a percentage of GDP. As you can clearly see, US receipts are currently very correlated with the stock market stock market, however, this was not always the case. US receipts and SPX (log scale) It is when the market and indeed the economy started to become "financialized" i.e. moving money around became a segment of the economy, that this relationship really took off. This is most likely due to governments preferring to opt for "easy" money rather than encouraging productive labor and real economic growth (harder to fudge that it seems). Back to the chart at hand The other point of interest is the surplus/deficit as a percentage of GDP, you will note that each financial crisis, the tech wreck, GFC and undoubtedly the global shutdown when that data is made available, the deficit never was able to "normalize" it was always started from a higher low, in other words, the deficit is in an uptrend. This leads to the obvious conclusion that if the deficit was 10% in the GFC, then what will the deficit be when the entire global economy is shutdown for a period of weeks or even months? Also, the astute of you will notice the period of "surplus" and whilst it is nice to think warm and fuzzy thoughts about a time when the US wasn't spending money like a drunken sailor, when you look at the Federal debt over the same period, you will notice an INCREASE, not a decrease, i.e. there was no true surplus that paid down debt. There was NO surplus What makes this truly terrible however, is when you look at the overall level of debt that the US has. US Federal Debt as a Percentage of GDP We are already well over 106% So much for the "best economy ever" What this means, in simple terms, is that the US debt is already at nose bleed levels and has been PRIOR to the global shutdown, the shutdown just making it worse and is impacting the stock market, which is a big driver for US receipts, this in turn with push the deficit higher, i am anticipating deficits that are at levels seen in the GFC (10% or higher) and i expect those to continue for quite some time. This is not even touching on the issue of confidence in the US monetary system, or the fact that the US is now officially dependent on artificially low interest rates to service it's current debt load, notwithstanding the added burden from the shutdown. This is one of the key reasons that the stock market MUST be re-inflated, at all costs. The government and the Federal Reserve (because they are separate entities) both know that main street is f*cked to put it bluntly, the impact from the shutdown is causing small and mid sized businesses to bleed, this will crush GDP and exacerbate the debt issues. Sooooo, they will inflate the stock markets, to alleviate some of the pressure on the whole thing, but it will ultimately cause a host of other issues down the line, far too many to discuss at this time. That, and the Fed never misses a chance to bailout their buddies, it is one of the small pleasures that they derive, that and debasing the currency supply for the rest of us. -TradingEdge
SP:SPX
by Profit_Link
AUDUSD (3 to 6 Months), Short followed by LongThis is based on the observation of the downward AUDUSD channel established from the beginning of this year. Apart from the technically lined lower lows and lower highs along well defined trendlines, a fundamental observation can be linked with the fact that we have observed cycles of: - Bullish Signs: Lower Unemployment rates, high GDP growth approaching 3% and especially an increasing trade surplus (3 Billion $ a month now, mostly due to booming LNG Exports). - Bearish Signs: Very dovish RBA keeping interest rates as low as they get and a kind of busting housing market in the east coast. For the following days expect the AUDUSD to trade momentarily higher from this level at (0.724 maybe up to 0.73 max), and pop out of the descending trendlines, but the first break will likely be a false one (or call it SL hunt) With the next RBA announcement mid next week, expect same cycle to repeat itself, dovish comments and AUDUSD will head down again to test key supports (TP1 0.695 or inversely USDAUD 1.44 key level) However, Australian resources industry is in full steam now, mining sector has recovered and major LNG projects are about to start producing (Gorgon, Wheatstone, Ichthys, Queenslands' Coal Seam LNG....), Australia will overtake Qatar as first LNG exporter globally and this will likely be reflected the AUDUSD rate. This will render RBA's dovish hammers non-meaningful and RBA will have little power remaining to curve AUDUSD down. One other key factor to consider, is that the major four banks are challenging the RBA (NAB, Commentwealth, Westpac, ANZ) with each going their own way and increasing mortgage rates, this may put pressure on RBA to follow free market science, and with the slightest mentioning of increasing interest rates sometime in the future the AUDUSD. A strong break of the downward channel is expected, the TP2 is estimated technically with previous trend lines , fiobonacci expansion and previous resistance level, in the range of 0.89 to 0.95. This is a personal interpretation for the trading community, trade at your own risk.
Long
by ahmedse
DATA VIEW (NOT A FORECAST): US BUDGET BALANCE IMPROVING US budget balance suffered a significant blow during the fallout of 2008/9 us mortgage crisis. Government stimulus measures needed at the time to stop the downward spiral in US markets created a huge budged deficit. In addition, government tax revenues fell sharply (as most corporations failed to show profit, thus to pay corporate taxes). Since 2011, however, situation in the budget balance started to improve. Urgent government aid was no longer required and tax revenues started to restore. The chart above is updated once a year, however in order to see that the positive trend is still intact, one can calculate current year-to-year budget deficit by visiting the US Treasury website: www.fiscal.treasury.gov
FRED:FYFSDLong
by Killy_Mel