Trading Plan – Mon 16 Sept: Drone attack on Saudi refinery ruins the mood but markets calm

Mark NugentSept 2019, Trading Plan

Trading Plan – Mon 16 Sept: Drone attack on Saudi refinery ruins the mood but markets calm

Week 37 was a pretty solid risk-on week. The first in a long time. A lot of big issues seemed to fade slightly: the US and China seemed to be making positive moves towards each other, National Security Advisor Bolton was sacked and the UN was preparing for a US/Iran meeting.

Global equities rose with the Japan225 being the star performer, bolstered by the weak JPY. GOLD moved down on the positive risk sentiment. WTI didn’t do much. On currencies, the GBP rose as chances of a no-deal Brexit lessened. AUD was bolstered by the sentiment.

The ECB re-introduced QE at the rate of EUR20B/month. This is a bad sign for the Eurozone economy.

US 2Y and 1Y bond yields rose, as bond prices fell on the positive sentiment.

Over the weekend we had drone strikes on Saudi oil facilities, taking out 50% of Saudi capacity and 5% of the world’s oil supply. Needless to say, WTI shot up last night at the open and equities have gapped down. WTI is now falling and equities are recovering. The markets seem to be reacting quite calmly.

Gauging developing sentiment will be key this week. The economic calendar throws up some interesting events – Fed on Wednesday and the Bank of England’s Super Thursday on, eh, Thursday.

Have a great week and I’ll talk to you tomorrow.

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