Daily Alert – Thursday 17th November 2022: Central banks go dovish, overnight

Mark NugentDaily Alert, Nov 2022

Daily Alert – Thursday 17th November 2022: Central banks go dovish, overnight

Good morning.

Yesterday saw a third consecutive day of indecisive risk sentiment. However, some interesting things did happen.

Firstly, in the UK, we had the Bank of England’s Monetary Policy Committee in front of the MPs for their regular grilling. (In fact, it is a bit like eagles being interviewed by turkeys. It can be quite fun to watch the studied patience on the faces of the eagles.) Anyway, we heard “if rates continue to rise, the economy could enter a deeper recession”, and “we are now seeing signs that the supply chain shock is starting to fade”. This is dovish and adds to my “sell” bias on the GBP.

Over at Bloomberg, there were reports that the European Central Bank “may” slow hiking with only a 50 basis-point rise in December, according to “sources”, the risk of recession being cited as a primary cause. Again, dovish and bolsters my “sell” bias.

Still no trading for me as the markets are becalmed.

The only major risk event left this week is today’s Autumn Forecast Statement where, hopefully, UK Chancellor Hunt can bury the last remnants of the Truss fiasco by delivering a credible fiscal plan leading to a reducing debt burden. The markets are not expecting him to mess up, and I am sure he won’t, but it is a risk event none-the-less.

Tomorrow, I shall have brief videos of the two trades closed last week, for your delectation.

VIP Club members can see today’s video, all brief trading videos, the Monthly and YTD Performance videos, the Trading Video Course and download the MTM Indicators software HERE