By Abdul H. Jaffar 
STATE OF THE MARKETS
Dollar firmed as stocks and yields dropped. US stocks closed lower on the first trading day of the year as investors took a more cautious stance ahead of the FOMC minutes on Wednesday. The Dollar index closed above the 104.50 minor handle as Nasdaq (-0.76%), Russell (-0.60%), S&P (-0.40%) and Dow (-0.03%) closed in the red amid falling yields as demand for bonds increased. The shorter 2Y settled at 4.38% while the 10Y benchmark at 3.75% as New York closed on Tuesday.
In the commodity markets, crude oil dropped to $77.30/bl on New York close after reports of weak data from China, the world’s largest oil importer. Flight to safety saw gold continue to climb near $1,850/oz despite Dollar strength. Elsewhere, iron ore jumped to $117.80/tn as bidders continue to flood the metal markets after news of China’s consolidation of 20 largest steelmakers.
In the FX space, safe haven Yen continued to reign in the medium and long term accounts while King Dollar seized the helm of demand in the short term. Oil weakness sent Loonie to offer in the short and medium term while Aussie remained in demand. Overall sentiments were mixed with demand for Swiss remained elevated in the medium and long term accounts.
On Wednesday, markets expected to be in choppy waters as investors geared up for the FOMC minutes and non-farm payroll on Friday. Earnings releases to watch include UniFirst Corp (UNF), Simulation Plus (SLP) and Resources Connection (RGP) as well as ISM manufacturing index, jobs opening, mortgage application index and the much awaited FOMC minutes.
G8 CURRENCIES SENTIMENTS
| ST | USD | JPY | AUD | GBP | CAD | NZD | EUR | CHF | ST |
| MT | JPY | AUD | USD | CHF | NZD | CAD | EUR | GBP | MT |
| LT | JPY | EUR | AUD | CHF | NZD | USD | GBP | CAD | LT |
** ST refers to Short-Term daily turnover, MT is Medium Term weekly and LT refers to Long-Term monthly turnover.
WALL ST MOST ACTIVE
| TICKER | LAST PRICE |
% CHANGE |
VOLUME | 90 DAYS AVG |
| TSLA | 108.10 | – 12.24 | 231,402.8K | 92,836.1K |
| TQQQ | 16.91 | – 2.25 | 179,963.2K | 215,340.4K |
| AAPL | 125.07 | – 3.74 | 112,117.4K | 87,113.2K |
| SOXL | 9.36 | – 3.21 | 97,562.7K | 112,710.7K |
| SQQQ | 55.15 | + 2.11 | 85,707.8K | 133,817.9K |
| AMZN | 85.82 | + 2.17 | 76,706.0K | 73,010.8K |
| SPY | 380.82 | – 0.42 | 74,984.0K | 88,249.0K |
| JSPR | 2.74 | + 467.41 | 63,703.6K | 787.3K |
| BBD | 2.56 | – 11.11 | 55,748.3K | 37,543.9K |
| NIO | 9.63 | – 1.23 | 54,131.2K | 56,729.8K |
** % Change here refers to price vs previous day price
WALL ST TOP FLOWS
| TICKER | LAST PRICE |
VOLUME |
% CHANGE | FUNDS FLOW $ |
| TSLA | 108.10 | 231,402.8K | + 53.15 | 25,014.6M |
| AAPL | 125.07 | 112,117.4K | + 35.81 | 14,022.5M |
| AMZN | 85.82 | 76,706.0K | + 3.31 | 6,582.9M |
| MSFT | 239.58 | 25,740.0K | – 9.61 | 6,166.8M |
| NVDA | 143.15 | 40,127.6K | – 5.64 | 5,744.3M |
| META | 124.74 | 35,528.5K | + 16.10 | 4,431.8M |
| AMD | 64.02 | 46,851.8K | – 12.62 | 2,999.5M |
| BABA | 91.98 | 27,891.0K | + 36.38 | 2,565.4M |
| GOOGL | 89.12 | 28,131.2K | – 3.11 | 2,507.1M |
| PYPL | 74.58 | 27,974.2K | + 78.36 | 2,086.3M |
** % change here refers to volume vs. 20 days average volume.
TOP 5 BLOCK ORDERS
| TICKER | PRICE | TYPE | VOL/OI | FUNDS FLOW |
| TSLA | 108.10 | stock/options | 264.39 | 25,014.6M |
| SWN | 5.50 | stock/options | 185.22 | 143.3M |
| AMRS | 1.45 | stocks/options | 95.54 | 15.2M |
| NQ | 10,973.75 | NASDAQ futures | 21,477 | 235.8M |
| YM | 33,297.00 | DOW futures | 6,937 | 231.2M |
OUR PICK – NZD/USD
Flight to safety may call for lower Kiwi. Markets seemed to gear up for a more hawkish Fed’s minutes as we see more flows into Ultrapro Short ETF (SQQQ) than the opposite Ultrapro QQQ ETF (TQQQ), suggesting stronger Dollar amid demand for US treasuries. 10Y yields however remained in favor of NZD (4.38%) than USD (3.72%) as at writing.
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| HORIZON | STRATEGY | SL | TP1 | TP2 |
| Short-Term | Sell | 0.6380 | 0.6200 | 0.6135 |
| Medium-Term | Sell | 0.6380 | 0.6135 | 0.6065 |
| Long-Term | Flat | – | – | – |
Disclaimer: This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.
RTC Team