InvestMacro Forex News

By CentralBankNews.info
    The Bank of Japan (BOJ) kept its monetary policy steady, as expected, and said Japan’s economy was expected to continue its moderate recovery but this would be “affected by the subsequent decline in demand following the front-loaded increase prior to the consumption tax hike.”
    The BOJ, which one year ago launched an aggressive easing program to rid Japan of some 15 years of deflation, again said inflation expectations appeared to be rising and the annual inflation rate, excluding the impact of the April 1 rise in the sales tax to 8 percent from 5 percent, was likely to be around 1.25 percent for some time.
    Financial markets are speculating that the BOJ may launch another round of quantitative easing in coming months if the impact of the higher sales tax has a large negative impact on the economy.
    Japan’s Gross Domestic Product expanded by 0.2 percent in the fourth quarter of last year for annual growth of 2.6 percent, the third quarter of accelerating growth.
    The BOJ has acknowledged that consumers have been purchasing goods in the months prior to the rise in the sales tax but expects the economic recovery to continue despite a temporary drop in demand in the months ahead.

    Japan’s inflation rate rose to 1.5 percent in February from 1.4 percent in January and the BOJ reiterated that it would continue with its quantitative and qualitative easing for as long as it is necessary to achieve its aim of boosting inflation to 2.0 percent.
    In April 2013 the BOJ changed its monetary policy framework and started to focus on boosting the country’s monetary base – cash in circulation and banks’  reserves – by an annual 60-70- trillion yen to 270 trillion by the end of this year from 138 trillion at the end of 2012.
    In a separate statement, the BOJ said the monetary base has risen to 220 trillion at the end of March from 205 trillion end-February.
    The BOJ is increasing the monetary base by purchasing Japanese government bonds, exchange-traded funds (ETFs), Japanese real estate investment trusts, commercial paper and corporate bonds.

    http://ift.tt/1iP0FNb

By MoneyMorning.com.au

California is the home of tech stocks.

Google [NASDAQ:GOOG], Facebook [NASDAQ:FB], and Oracle [NASDAQ:ORCL] all call California home.

They are among the biggest technology stocks on the market.

Your editor’s hotel here in San Diego is just a stone’s throw from the HQ of another tech giant, Qualcomm [NASDAQ:QCOM].

Tech stocks took a beating on Friday when the NASDAQ index fell 2.6%. Today the NASDAQ index fell 1.6%.

Is this the end of the technology stock rally? Is this dot-com bust mark two? Is it time to go back to good old-fashioned bricks and mortar?

Based on our experience here in Southern California, we wouldn’t be so quick to draw that conclusion. Given the choice, we’d happily buy technology stocks at these prices and sell a group of stocks that really are at death’s door.

It’s advice that translates well to the Australian share market too…

The mainstream has been falling over themselves to draw attention to last Friday’s tech stock slump.

For some time we’ve heard the wailing about crazy-high valuations.

Much of that attention has focused on another US west coast giant (Washington state-based) Amazon.com Inc [NASDAQ:AMZN].

Even though the stock has fallen 19% since the start of the year, it’s still trading at a price to earnings ratio (PE) of 552-times. That’s expensive by anyone’s standards.

But here’s the important thing. It’s not just about how a stock’s value shapes up today, it’s about where the valuation could be in the future. That’s why even with a PE of 552-times earnings, we’d rather buy Amazon.com stock than the stock of another group of companies.

Buy for a bargain or short sell to zero?

On this trip to San Diego we’re staying in the La Jolla (pronounced La Hoya) area, a northern suburb about 15 minutes from downtown.

Naturally, we’ve spent some time checking out the area, including the nearby Westfield [ASX:WDC] owned UTC open air shopping mall.

As far as malls go, it’s a great combination of mall and ‘high street’ shopping strip. It’s easy for parking, and there’s a good variety of stores, as you’d expect from a typical ‘high street’ shopping area.

Of course, as with any mall, there are always the ‘anchor tenants’. In this case it’s the big department store retailers Sears [NASDAQ:SHLD], Macy’s [NYSE:M], and Nordstrom [NYSE:JWN].

After spending 20 minutes wandering through each of Macy’s, Sears and Nordstrom, we came away with the feeling that the stock of these companies must be either a rock-bottom turnaround play (the type that Jason Stevenson looks for in resource stocks) ready for a contrarian investor to pounce, or that they are ripe for short sellers to beat them into the ground.

We would only know the answer for sure after checking out each company’s recent stock price movements, and their financials.

Even favourable demographics can’t help these stocks

In terms of stock price performance, it turns out it has been a mixed bag:

Source: Google Finance
Click to enlarge

Over the past five years Sears has fallen 20%, Nordstrom has gained 185%, and Macy’s has piled on an amazing 476%.

If we can put that in perspective for a moment, Amazon.com stock has climbed 358% over the same period.

In terms of financials, Amazon.com generates about three times as much revenue as Macy’s. Amazon.com’s revenue for the last financial year was US$74.5 billion. However, using the same financial year, Macy’s generated a profit of US$1.5 billion compared to just US$274 million for Amazon.com.

Now, although current revenue and profit is important, as a stock investor it’s more important to consider the future.

Let’s go back to our brief experience in these three department stores on Saturday. The UTC shopping mall was a hustling and bustling throng of people of all ages. As an open-air mall it was a perfect shopping day with the temperature in the high teens.

The queue for the craft beer festival in the mall’s centre square was a good 60–70 metres long. And most of the individual stores appeared to have good foot traffic and plenty of ringing tills.

We can’t say the same for the three department stores. While the demographic of shoppers in the rest of the mall spanned the age spectrum, in the department stores the average age was 60-plus…if not 70-plus.

But that wasn’t the biggest problem. With an ageing population, you could argue that the ‘old way’ of shopping is here to stay. But it’s not. The atmosphere in the department stores was more like a morgue than a thriving retail experience.

Most of the old folks appeared happier flitting in and out of the specialty stores along with the rest of the crowd rather than facing the risk of tripping over frayed-edge carpet and travelling on rickety escalators.

So what’s our point?

There’s more to a stock story than PE ratios

It was just a coincidence, but it was an appropriate one. While strolling through Westfield UTC we noticed the big video display showing the latest news.

It announced that Amazon.com was launching a delivery service to ship fresh produce to people’s homes.

Amazon.com — the company that almost singlehandedly helped to destroy book retailing, and which is in the process of killing off department stores, is now taking aim at another branch of retailing, grocery stores.

In short, yes we get it that Amazon is trading at a crazy valuation, but PE ratios don’t always tell the full story. Macy’s current PE is 15-times earnings. By any conventional comparison it should be easy to say that Macy’s is a buy and Amazon.com is a sell.

But looking at current PE ratios isn’t always the best way to value a stock. You have to do more than that. You have to consider the future. It’s clear the old department store style of retailing is reaching an end.

It’s happening here in the US, and it’s happening in Australia too. Retailing is at a key juncture. Consumers have spoken. They want two things. They want smaller, boutique style specialty stores where they can browse and find unique things.

And most of all they want an efficient online experience. That’s what Amazon.com gives its customers, and generally, it’s what the traditional department stores don’t.

We know which stock we’d rather own.

Cheers,
Kris+

PS: Small-cap analyst Tim Dohrmann recently touched on a similar point in Australian Small-Cap Investigator. In the monthly issue he highlighted a tiny company that could become the ‘Amazon’ of the Aussie market as it ramps up its local online business. It’s an intriguing story and a great opportunity that has only just become available to Aussie investors. Click here to find out how to get the inside scoop on this tiny Aussie success story…

From the Port Phillip Publishing Library

Special Report: Mining Boom Act II

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By MoneyMorning.com.au

By MoneyMorning.com.au

The legal battles surrounding mobile devices, the so-called ‘smartphone patent wars’, are absolutely fascinating.

Last week saw Samsung and Apple limbering up for another US courtroom drama, with Apple claiming to be the great innovator. We’re all supposed to believe that smartphones didn’t exist before they came up with their iPhone. While it’s true Apple came up with a great product, can they really claim a monopoly on rounded corners on a rectangle? Or perhaps a patent on a sliding switch?

I mean, I’ve always enjoyed the beautifully crafted rounded corners on my oak-cased Roberts radio. And come to think of it, it also had a sliding switch! What gives?

Of course, those in the know tell me there’s much more to it than that…but is there really? It strikes me that Apple is exhibiting the classic symptoms of a monopoly power that’s losing its grip.

The courtroom battle may well be between Apple and Samsung. But be under no illusion. The real battle is between Google and Apple.

And in this battle, I’ve already nailed my colours to the mast. Apple is fighting to maintain its slot as the globe’s top company. But Google is nipping at its heels and no amount of courtroom drama will keep Apple from being toppled.

This Time Samsung Has Backup

You’ll often hear it said that when it comes to courtroom battles, it’s the guy with the biggest chequebook that wins. And Apple certainly has a fat chequebook.

But it’s not as if Samsung hasn’t got a decent legal team of its own. It has! And I strongly believe that justice prevails in the end. Already it seems Judge Lucy Koh’s Californian courtroom is starting to lose patience with Apple’s monopolistic ambitions.

After all, this isn’t the first time Apple has dragged Samsung into the courtroom. In the first foray, Apple was awarded just shy of a billion dollars in damages. But in reality, the skirmish was seen as a win for Samsung. The firm was still able to sell its units in the States, and Apple was told to pipe down on most of its claims.

This time round, Samsung is also likely to have Google on its side. The Wall Street Journal reports that Google engineers, including former Android Chief Andy Rubin, may testify.

‘Google will be a lot more front and centre than in previous cases,’ claims Michael Carrier, a patent expert and law professor at Rutgers University in New Jersey. ‘Google vs. Apple makes it more of a clash of the titans on the same turf.’

And don’t forget, Google also has a considerable patent portfolio. A few years back, Google bought Motorola in a deal that netted little more than a library of patents. Google later sold the actual phones business at a massive loss.

It seems that this courtroom drama will be a series of claims by Apple, followed by a whole host of counter-claims from Samsung (aided and abetted by Google).

Apple is Turning into a Bully

I’ve never been a fan of Apple’s ‘closed-wall’ approach to technology. That is, how it ties users in to its software, hardware and ‘family’ of online products. The business model is based on a monopolistic game-plan. Now, don’t get me wrong, Apple has every right to pursue its business model as it likes.

But public perception is starting to go the wrong way for Apple. Journalists jibe Apple, suggesting that perhaps French cheese makers should await court papers from Apple for patent infringement on the rounded corners on a lump of Roquefort!

Nobody likes a bully. And that’s increasingly what Apple looks like.

The fact of the matter is that competition is a delicate balance between innovation and copycat production.

I mean, you only have to look at the fashion industry. The minute a new dress hits the catwalk, the copycats get to work. Next, Primark, you name it. They unapologetically release clone products as soon as they possibly can. That is not to say that these things are Versace, or Prada. It’s just that imitation is the best form of flattery — and imitation should be allowed.

Apple is pushing its case too strongly. Now, that may be just my opinion, but there’s evidence that the courts are increasingly taking this opinion too. The courts are getting bored of the patent wars. Increasingly patents are being used to stifle innovation, rather than enable it. And that’s the complete opposite to the intent of patents in the first place.

Of course, they’re not the only ones. All the big tech companies play the patent game and suffer patent syndrome. It’s just that Apple is increasingly looking like the giant trying to trample on the rest of the industry.

And as these trials drag through the courts, the battle on the ground continues. And Android devices are winning. What’s more, with hundreds of Android manufacturers competing against each other in this space, there’s no doubt where the genuine innovations are now coming from

Apple has had its day in the sun. Now all it can do is try to fight to maintain its innovations of yesteryear. And we’re all getting bored of it.

Bengt Saelensminde,
Contributing Editor, Money Morning

Ed Note: The above article was originally published in MoneyWeek.

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By MoneyMorning.com.au

While everyone has been focusing on Crude Oil futures crossing the round $100.00 handle back and forth, the struggle to find a clear direction has led to higher swing lows and lower highs, hence the market is stuck in a triangle pattern. With a distance of less then $2 between the triangle resistance and it’s support, as price is nearing the tip of the formation, we should see this struggle come to an end in the coming days.

The 61.8% Fibonacci retracement bounces, first for the drop from $112.13 to $91.33, followed by the perfect 61.8% Fibonacci correction to $102.21 for March’s bearish swing, have led wave analysts to consider the possibility that a downward continuation is in play. This scenario will be invalidated if price will rally above $102.21. Activating the stop losses accumulated above this level will help the market make rise towards $104.19 – $105.20, where sellers would once again have their long term bearish view put to the test.

With most major moving averages already stationed inside the triangle formation, there is little point in picking any other first support other than 98.85, the most recent swing low on the support trendline. A bearish triangle breakout is unlikely to reverse at $98.10, the 100-Day Moving Average, since the logical downtrend scope is the formation of a lower low below $97.35.

*********
Prepared by Alexandru Z., Chief Currency Strategist at Capital Trust Markets

Source: Kevin Michael Grace of The Gold Report (4/7/14)

http://www.theaureport.com/pub/na/ted-dixon-what-gold-stock-insider-trading-tells-us

Despite the recent big gains in gold stocks, company insiders and institutional investors are still 2.5 times more likely to be buyers than sellers. According to Ted Dixon, co-founder and CEO of INK Research, this shows that those in the know are still quite bullish, despite the pullback in March. In this interview with The Gold Report, Dixon names the top insider buyers by dollar amount and by volume and explains how investors should interpret this data.

  The Gold Report: The price of gold fell more than 6% in March. To what do you attribute this?

Ted Dixon: Gold took a one-two punch in late March. The first was the widening of the renminbi trading ban in China by 2%, which added extra costs to buying and hedging gold. The second was the surprisingly hawkish tilt of the U.S. Federal Reserve, pointing to interest rates rising a little bit sooner. Tighter monetary conditions do not usually benefit gold.

TGR: Increased import duties in India haven’t reduced gold buying there. Why would China be different?

TD: I think the flows are different. In China, there is a lot of financial activity related to gold, whereas in India gold buying is cultural and driven by consumer consumption.

TGR: We’ve heard about greatly increased governmental buying in China, have we not?

TD: There have been rumors of that, and the Chinese media has called for the government to boost its gold reserves. That could provide a longer-term counterbalance to the shorter-term renminbi pressure.

TGR: DataQuick’s latest U.S. national homes sales snapshot shows that “prices are flatlining or drifting lower while sales are sinking like a stone.” Meanwhile, “The big private equity firms [are] exiting the [housing] market.” These data don’t suggest a U.S. economic recovery, do they?

TD: Basically, insiders are telling us that stock prices now have priced in a lot of good news, so it would be interesting to see how they react to whips to the downside. One has to be cognizant that much of the U.S. equities rally has been driven by the Fed and, arguably, has little to do with GDP growth one way or the other.

TGR: With regard to this hawkish tilt, it has been assumed for several years that we’d see higher interest rates and an end to quantitative easing (QE) only after an economic recovery. Given how weak the U.S. economy remains, can we assume that the Fed believes it is close to exhausting the utility of zero interest rates and quantitative easing?

TD: The Fed has a big ticking time bomb on its balance sheet. It is still piling up reserves, and I’d love to be a fly on the wall in staff meetings that don’t get reported. I have to assume there is much concern about what happens to those reserves, particularly if the economy does surprise on the upside. In this sense, the low-altitude economy has been a blessing for the Fed.

We may have a little game of bluff going on here. The Fed is taking a hawkish stance now, saying it has to move rates up earlier, but, of course, if the economy remains weak, and the Fed has to backtrack, that opens up risks on the other side. The Fed has been running a big monetary policy laboratory over the past few years, and sometimes in laboratories accidents happen. At this point, however, the stock market seems to have assigned a very little risk premium to something bad happening.

TGR: It has been argued that if you remove the Fed’s monthly stimulus from the monthly GDP report, GDP is actually shrinking, not growing.

TD: The Fed has certainly manipulated the economy. It has picked its favorite sectors, housing and autos. I believe that Operation Twist and QE have hurt the commodities base because they have favored interest-sensitive industries. Now, however, these industries will have to stand on their own two feet, and we’ll see how this experiment in industrial policy works out. Usually, planned economies have a day of reckoning when stimulative measures run out of steam.

TGR: Your company, INK Research, tracks the legally reported buying and selling by public company executives and institutional investors. What does this tell us about the status of individual companies in particular, and the gold sector in general?

TD: In general, U.S. market-insider indicators have been languishing at 25% for a long time. Insiders do not see very many bargains. This suggests that value strategies are going to be very important going forward if you’re looking to make money in the broad market.

A year ago, in the gold sector, insider buying went through the roof as the prices of gold and gold equities tumbled down. This was a bit early, but it basically confirmed a bottom in the equities last spring. The S&P composite gold index finally moved above 1,800 and then pulled back, with some insider selling into that run-up. We’re seeing a measured profit taking. It’s nice that there can be some profit taking in the gold sector, given how beat up it’s been, but money has come off the table, and that could foreshadow some short-term weakness.

TGR: As of March 24, 2014, your INK sentiment indicator of Toronto Stock Exchange (TSX)-listed stocks is 85.2%. What does that figure mean?

TD: It means there’s less insider buying than trading. At 100%, you have an equal amount of insider buys and sales. So the indicator rating is Overvalued.

TGR: For the TSX Venture-listed stocks in total, the figure is 341.1%.

TD: Right. That includes not just gold stocks but also the other miners and technology and energy juniors. But the TSX Venture Exchange is heavily weighted toward junior mining.

For the overall TSX gold sector, the indicator is 250%. So we’re seeing 2.5 companies with insider buying for every one that’s selling. This means that gold stock insiders are still quite bullish, despite the recent pullback.

TGR: And that indicator reading equals Undervalued?

TD: Right. The junior miners have been toughing it out for years. The TSX Venture Index moved 20% above its 2013 lows in March, and it’s been a long time coming. The insiders were early, but they’re not packing their bags now.

TGR: You publish a list of Top 50 Insider Buys by dollar amount over the past 60 days. What’s the significance of this?

TD: The dollar amount is a good initial screen to examine. Of course, you want to look at it with regard to the overall market cap of the company. So $1 million ($1M) bought in a large-cap company is not as significant as $1M bought in a medium- or micro-cap company. We also look at both the company’s valuation and its price direction because they put the insiders’ signals in context.

For example, if a stock is going up and there’s a lot of insider buying, that could mean insiders are buying into the news. On the other hand, if the stock has fallen and there’s a lot of insider buying, that could signal a value opportunity, that the market has overreacted. Then you want to dig a little deeper and see who specifically in the company is doing the buying.

TGR: Which gold and silver miners are in the Top 50 insider net buying by dollar volume as of March 24?

TD: B2Gold Corp. (BTG:NYSE; BTO:TSX; B2G:NSX) is No. 13 with $579,106, Wildcat Silver Corp. (WS:TSX.V) is No. 17 with $411,030, Premier Gold Mines Ltd. (PG:TSX) is No. 18 with $401,660, Barrick Gold Corp. (ABX:TSX; ABX:NYSE) is No. 25 with $335,720, IAMGOLD Corp. (IMG:TSX; IAG:NYSE) is No. 32 with $221,188, Treasury Metals Inc. (TML:TSX) is No. 35 with $192,760, Rusoro Mining Ltd. (RML:TSX.V) is No. 38 with $154,600 and Roxgold Inc. (ROG:TSX.V) is No. 48 with $120,000.

TGR: To what extent can insider buying be attributed to confirmation bias? In other words, this must be a good company, otherwise I wouldn’t be working for it.

TD: That is something to be aware of. There may be examples of that, but we find that insiders tend to buy when they think they can make money. They are usually pretty picky, and they usually like to spot opportunities for bargains. And one has to keep in mind again that insiders tend to be early, and I think that’s a more important consideration than confirmation bias.

The one big exception to this is when companies issue good news, and insiders buy. This could be a signal that the market hasn’t yet fully priced in that news.

TGR: Pretty much every company in the list above has seen a significant share price fall in the second half of March. To what extent, particularly among the juniors and the micro caps, could insider buying be seen as an attempt to bolster investor confidence?

TD: That’s why we must look at each stock individually. In addition, it’s best to look at insider signals on a portfolio basis. We’ve found that when investors have a portfolio of stocks that use insider signals as a key input, they are going to have a few big winners, a number of stocks that do better than the market and a number that do worse. Investors certainly want to avoid the tendency to zero in on one company on an insider-buy basis and then put all their eggs in one basket. That would not be prudent.

TGR: How often do you track insider buying and selling?

TD: All our indicators are updated overnight, like a rolling poll. They are aggregated across the sectors, so they tend to even out company-specific situations. We update individual companies daily because, as I mentioned, when a news release comes out, it could change company fundamentals. So we want to see how insiders react to that change.

TGR: How about Barrick, in particular? It took a hit March 24 after a Barron’s article cited a Credit Suisse Group analyst who continued to rate Barrick and Newmont Mining Corp. (NEM:NYSE) shares Neutral. Would the insider buying and selling in the days after this event be pretty significant?

TD: In our view, it would be. We don’t consider analysts ratings’ in our models, but investors can do both and compare, if they like.

TGR: What does it tell you when Barrick has had so much bad news lately, and yet it appears in the Top 50 list of insider buying by dollar amount?

TD: Well, insiders as a group are suggesting that the prospects for Barrick going forward are likely pretty good. It doesn’t mean the numbers wouldn’t get dragged down should the gold price take a tumble, but there’s enough insider buying there for us to have put Barrick in the top 30% of all stocks we rank. Our rankings are not an investment recommendation, of course.

TGR: How about other majors? In your interview with The Gold Report last year you said that it was “nice to see” that Goldcorp Inc.’s (G:TSX; GG:NYSE) chairman had bought shares. How does this company look in that regard lately?

TD: We’ve seen with Goldcorp some insider selling related primarily to insider compensation. It’s not unusual, but it has taken place at the same time as the post-December rally. Insider holdings at Goldcorp have remained fairly steady.

TGR: Which gold and silver miners are in your Top 50 insider net buying by share volume over the last 60 days as of March 24? There seem to be a lot of names, so how about only those in the first 25?

TD: Rusoro is No. 3 with 5,155,000; Quia Resources Inc. (QIA:TSX.V) is No. 6 with 3,920,000 shares; Manson Creek Resources Ltd. (MCK:TSX.V) is No. 17 with 1,679,500 shares; Currie Rose Resources Inc. (CUI:TSX.V) is No. 18 with 1,500,000 shares; Crown Gold Corp. (CWM:TSX.V) is No. 19 with 1,500,000 shares; Eskay Mining Corp. (ESK:TSX.V) is No. 20 with 1,460,000 shares; and Silver Predator Corp. (SPD:TSX) is No. 22 with 1,395,000 shares.

TGR: How significant is this data?

TD: Actual volume is another good first screening, but most of the companies that appear here tend to be small. When stocks are light traders with market caps under $20M, you’ve got to do more homework to ascertain what might be motivating insider activity. Is this company a value proposition, or is something else going on? You want to take a good look at the company’s management and its cash position.

TGR: Arian Resources Corp. (ARC:TSX.V; 0GT1:FSE) closed a $2.78M private placement March 24. Of the 18M units sold, 800,000–that’s $120,000 worth–were bought by members of that company’s advisory board. What does this data tell us?

TD: I can’t comment on a specific transaction, but, in general, when there are private placements you want to look at the terms. If they are reasonable, and management is participating, then it’s positive. But, of course, every deal is different, so that’s why we focus on public-market activity, which is more of a standard measure.

TGR: Your Top 3 INK Edge Quick Wins Q4/13 has Wesdome Gold Mines Ltd. (WDO:TSX) at No. 3, up 50%. What can you tell us about this?

TD: Our Morning Hour Report stocks use our INK Edge process, which looks at insider activity, valuation and price rank. We call it VIP criteria of valuation, insiders and price, and what we’re looking for is the stocks that have insider buying that are good value and have good price strength. That’s what we scour the market for every day.

TGR: So based on your various indices, which stocks stand out in insider buying, good value and good price strength?

TD: I’ll repeat the caution that investors should take a diversified approach. I’ve already mentioned Barrick, which ranks quite well on our screens. Looking at other stocks with high amounts of key insider buying as of March 24, the company with the second-highest amount over the last 30 days is Endeavour Mining Corp. (EDV:TSX; EVR:ASX); it also has a mostly sunny outlook according to our INK Edge, which puts it in the top 30% of all stocks ranked.

Teranga Gold Corp. (TGZ:TSX; TGZ:ASX) is also in our top 30% of all stocks ranked. It has a mostly sunny INK Edge outlook. Arian Resources is No. 4 in insider buying and Amarillo Gold Corp. (AGC:TSX.V) is No. 5. But we do not rank the last two stocks due to their small sizes. These might be stocks for investors with very high risk tolerances to take a look at.

TGR: Ted, thank you for your time and your insights.

Ted Dixon is co-founder of INK Research (Insider News and Knowledge), Canada’s first online financial news and research service dedicated to providing data on public company insider trading. (Free services are found on CanadianInsider.com and InsiderTracking.com.) He worked previously for Connor, Clark & Lunn Financial Group in portfolio strategy and product development, the Fraser Institute as an analyst, TD Bank as a treasury specialist and the Vancouver Stock Exchange as a floor trader. He has lectured in corporate finance at the BC Institute of Technology and is a Chartered Financial Analyst and member of CFA Vancouver. He holds a Master of Business Administration in financial management from the University of Chicago.

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DISCLOSURE:

1) Kevin Michael Grace conducted this interview for Streetwise Reports LLC, publisher of The Gold Report, The Energy Report, The Life Sciences Report and The Mining Report, and provides services to Streetwise Reports as an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None.

2) The following companies mentioned in the interview are sponsors of Streetwise Reports: Premier Gold Mines Ltd. and Roxgold Inc. Goldcorp Inc. is not associated with Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services.

3) Ted Dixon: I own, or my family owns, shares of the following companies mentioned in this interview: None. I personally am, or my family is, paid by the following companies mentioned in this interview: None. My company has a financial relationship with the following companies mentioned in this interview: None. I was not paid by Streetwise Reports for participating in this interview. Comments and opinions expressed are my own comments and opinions. I had the opportunity to review the interview for accuracy as of the date of the interview.

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<p>Source: Kevin Michael Grace of <i><a href=”http://www.theaureport.com/“>The Gold Report </a></i>(4/7/14)</p>

<p><a href=”http://www.theaureport.com/pub/na/ted-dixon-what-gold-stock-insider-trading-tells-us“>http://www.theaureport.com/pub/na/ted-dixon-what-gold-stock-insider-trading-tells-us</a></p>

<p><a href=”http://www.theaureport.com/pub/htdocs/expert.html?id=9254“></a><a name=”_”></a>Despite the recent big gains in gold stocks, company insiders and institutional investors are still 2.5 times more likely to be buyers than sellers. According to Ted Dixon, co-founder and CEO of INK Research, this shows that those in the know are still quite bullish, despite the pullback in March. In this interview with <i><a href=”http://www.theaureport.com/” target=”_blank”>The Gold Report</a>,</i> Dixon names the top insider buyers by dollar amount and by volume and explains how investors should interpret this data. </p>

<p><b><i>The Gold Report:</i> </b>The price of gold fell more than 6% in March. To what do you attribute this?</p>

<p><b>Ted Dixon:</b> Gold took a one-two punch in late March. The first was the widening of the renminbi trading ban in China by 2%, which added extra costs to buying and hedging gold. The second was the surprisingly hawkish tilt of the U.S. Federal Reserve, pointing to interest rates rising a little bit sooner. Tighter monetary conditions do not usually benefit gold.</p>

<p><b>TGR:</b> Increased import duties in India haven’t reduced gold buying there. Why would China be different?</p>

<p><b>TD:</b> I think the flows are different. In China, there is a lot of financial activity related to gold, whereas in India gold buying is cultural and driven by consumer consumption.</p>

<p><b>TGR:</b> We’ve heard about greatly increased governmental buying in China, have we not?</p>

<p><b>TD:</b> There have been rumors of that, and the Chinese media has called for the government to boost its gold reserves. That could provide a longer-term counterbalance to the shorter-term renminbi pressure.</p>

<p><b>TGR:</b> DataQuick’s latest U.S. <a href=”http://www.unz.com/mwhitney/housing-one-chart-says-it-all/” target=”_blank”>national homes sales snapshot</a> shows that “prices are flatlining or drifting lower while sales are sinking like a stone.” Meanwhile, “The big private equity firms [are] exiting the [housing] market.” These data don’t suggest a U.S. economic recovery, do they? </p>

<p><b>TD:</b> Basically, insiders are telling us that stock prices now have priced in a lot of good news, so it would be interesting to see how they react to whips to the downside. One has to be cognizant that much of the U.S. equities rally has been driven by the Fed and, arguably, has little to do with GDP growth one way or the other. </p>

<p><b>TGR:</b> With regard to this hawkish tilt, it has been assumed for several years that we’d see higher interest rates and an end to quantitative easing (QE) only after an economic recovery. Given how weak the U.S. economy remains, can we assume that the Fed believes it is close to exhausting the utility of zero interest rates and quantitative easing?</p>

<p><b>TD:</b> The Fed has a big ticking time bomb on its balance sheet. It is still piling up reserves, and I’d love to be a fly on the wall in staff meetings that don’t get reported. I have to assume there is much concern about what happens to those reserves, particularly if the economy does surprise on the upside. In this sense, the low-altitude economy has been a blessing for the Fed.</p>

<p>We may have a little game of bluff going on here. The Fed is taking a hawkish stance now, saying it has to move rates up earlier, but, of course, if the economy remains weak, and the Fed has to backtrack, that opens up risks on the other side. The Fed has been running a big monetary policy laboratory over the past few years, and sometimes in laboratories accidents happen. At this point, however, the stock market seems to have assigned a very little risk premium to something bad happening. </p>

<p><b>TGR:</b> It has been argued that if you remove the Fed’s monthly stimulus from the monthly GDP report, GDP is actually shrinking, not growing. </p>

<p><b>TD:</b> The Fed has certainly manipulated the economy. It has picked its favorite sectors, housing and autos. I believe that Operation Twist and QE have hurt the commodities base because they have favored interest-sensitive industries. Now, however, these industries will have to stand on their own two feet, and we’ll see how this experiment in industrial policy works out. Usually, planned economies have a day of reckoning when stimulative measures run out of steam.</p>

<p><b>TGR:</b> Your company, INK Research, tracks the legally reported buying and selling by public company executives and institutional investors. What does this tell us about the status of individual companies in particular, and the gold sector in general?</p>

<p><b>TD:</b> In general, U.S. market-insider indicators have been languishing at 25% for a long time. Insiders do not see very many bargains. This suggests that value strategies are going to be very important going forward if you’re looking to make money in the broad market. </p>

<p>A year ago, in the gold sector, insider buying went through the roof as the prices of gold and gold equities tumbled down. This was a bit early, but it basically confirmed a bottom in the equities last spring. The S&amp;P composite gold index finally moved above 1,800 and then pulled back, with some insider selling into that run-up. We’re seeing a measured profit taking. It’s nice that there can be some profit taking in the gold sector, given how beat up it’s been, but money has come off the table, and that could foreshadow some short-term weakness.</p>

<p><b>TGR:</b> As of March 24, 2014, your INK sentiment indicator of Toronto Stock Exchange (TSX)-listed stocks is 85.2%. What does that figure mean?</p>

<p><b>TD:</b> It means there’s less insider buying than trading. At 100%, you have an equal amount of insider buys and sales. So the indicator rating is Overvalued.</p>

<p><b>TGR:</b> For the TSX Venture-listed stocks in total, the figure is 341.1%.</p>

<p><b>TD:</b> Right. That includes not just gold stocks but also the other miners and technology and energy juniors. But the TSX Venture Exchange is heavily weighted toward junior mining. </p>

<p>For the overall TSX gold sector, the indicator is 250%. So we’re seeing 2.5 companies with insider buying for every one that’s selling. This means that gold stock insiders are still quite bullish, despite the recent pullback. </p>

<p><b>TGR:</b> And that indicator reading equals Undervalued?</p>

<p><b>TD:</b> Right. The junior miners have been toughing it out for years. The TSX Venture Index moved 20% above its 2013 lows in March, and it’s been a long time coming. The insiders were early, but they’re not packing their bags now.</p>

<p><b>TGR:</b> You publish a list of Top 50 Insider Buys by dollar amount over the past 60 days. What’s the significance of this?</p>

<p><b>TD:</b> The dollar amount is a good initial screen to examine. Of course, you want to look at it with regard to the overall market cap of the company. So $1 million ($1M) bought in a large-cap company is not as significant as $1M bought in a medium- or micro-cap company. We also look at both the company’s valuation and its price direction because they put the insiders’ signals in context. </p>

<p>For example, if a stock is going up and there’s a lot of insider buying, that could mean insiders are buying into the news. On the other hand, if the stock has fallen and there’s a lot of insider buying, that could signal a value opportunity, that the market has overreacted. Then you want to dig a little deeper and see who specifically in the company is doing the buying.</p>

<p><b>TGR: </b>Which gold and silver miners are in the Top 50 insider net buying by dollar volume as of March 24?</p>

<p><b>TD:</b> <a href=”http://www.theaureport.com/pub/co/819” target=”_blank”>B2Gold Corp. (BTG:NYSE; BTO:TSX; B2G:NSX)</a> is No. 13 with $579,106, <a href=”http://www.theaureport.com/pub/co/824” target=”_blank”>Wildcat Silver Corp. (WS:TSX.V)</a> is No. 17 with $411,030, <a href=”http://www.theaureport.com/pub/co/534” target=”_blank”>Premier Gold Mines Ltd. (PG:TSX)</a> is No. 18 with $401,660, <a href=”http://www.theaureport.com/pub/co/20” target=”_blank”>Barrick Gold Corp. (ABX:TSX; ABX:NYSE)</a> is No. 25 with $335,720, <a href=”http://www.theaureport.com/pub/co/682” target=”_blank”>IAMGOLD Corp. (IMG:TSX; IAG:NYSE)</a> is No. 32 with $221,188, <a href=”http://www.theaureport.com/pub/co/2138” target=”_blank”>Treasury Metals Inc. (TML:TSX)</a> is No. 35 with $192,760, <a href=”http://www.theaureport.com/pub/co/1070” target=”_blank”>Rusoro Mining Ltd. (RML:TSX.V)</a> is No. 38 with $154,600 and <a href=”http://www.theaureport.com/pub/co/3926” target=”_blank”>Roxgold Inc. (ROG:TSX.V)</a> is No. 48 with $120,000. </p>

<p><b>TGR:</b> To what extent can insider buying be attributed to confirmation bias? In other words, this must be a good company, otherwise I wouldn’t be working for it.</p>

<p><b>TD:</b> That is something to be aware of. There may be examples of that, but we find that insiders tend to buy when they think they can make money. They are usually pretty picky, and they usually like to spot opportunities for bargains. And one has to keep in mind again that insiders tend to be early, and I think that’s a more important consideration than confirmation bias.</p>

<p>The one big exception to this is when companies issue good news, and insiders buy. This could be a signal that the market hasn’t yet fully priced in that news.</p>

<p><b>TGR:</b> Pretty much every company in the list above has seen a significant share price fall in the second half of March. To what extent, particularly among the juniors and the micro caps, could insider buying be seen as an attempt to bolster investor confidence?</p>

<p><b>TD:</b> That’s why we must look at each stock individually. In addition, it’s best to look at insider signals on a portfolio basis. We’ve found that when investors have a portfolio of stocks that use insider signals as a key input, they are going to have a few big winners, a number of stocks that do better than the market and a number that do worse. Investors certainly want to avoid the tendency to zero in on one company on an insider-buy basis and then put all their eggs in one basket. That would not be prudent.</p>

<p><b>TGR:</b> How often do you track insider buying and selling? </p>

<p><b>TD:</b> All our indicators are updated overnight, like a rolling poll. They are aggregated across the sectors, so they tend to even out company-specific situations. We update individual companies daily because, as I mentioned, when a news release comes out, it could change company fundamentals. So we want to see how insiders react to that change.</p>

<p><b>TGR:</b> How about Barrick, in particular? It took a hit March 24 after a <i>Barron’s</i> article cited a Credit Suisse Group analyst who continued to rate Barrick and Newmont Mining Corp. (NEM:NYSE) shares Neutral. Would the insider buying and selling in the days after this event be pretty significant? </p>

<p><b>TD:</b> In our view, it would be. We don’t consider analysts ratings’ in our models, but investors can do both and compare, if they like.</p>

<p><b>TGR:</b> What does it tell you when Barrick has had so much bad news lately, and yet it appears in the Top 50 list of insider buying by dollar amount?</p>

<p><b>TD:</b> Well, insiders as a group are suggesting that the prospects for Barrick going forward are likely pretty good. It doesn’t mean the numbers wouldn’t get dragged down should the gold price take a tumble, but there’s enough insider buying there for us to have put Barrick in the top 30% of all stocks we rank. Our rankings are not an investment recommendation, of course.</p>

<p><b>TGR:</b> How about other majors? In your <a href=”http://www.theaureport.com/pub/na/15372” target=”_blank”>interview</a> with <i>The Gold Report</i> last year you said that it was “nice to see” that <a href=”http://www.theaureport.com/pub/co/23” target=”_blank”>Goldcorp Inc.’s (G:TSX; GG:NYSE)</a> chairman had bought shares. How does this company look in that regard lately?</p>

<p><b>TD:</b> We’ve seen with Goldcorp some insider selling related primarily to insider compensation. It’s not unusual, but it has taken place at the same time as the post-December rally. Insider holdings at Goldcorp have remained fairly steady.</p>

<p><b>TGR:</b> Which gold and silver miners are in your Top 50 insider net buying by share volume over the last 60 days as of March 24? There seem to be a lot of names, so how about only those in the first 25?</p>

<p><b>TD:</b> Rusoro is No. 3 with 5,155,000; <a href=”http://www.theaureport.com/pub/co/4953” target=”_blank”>Quia Resources Inc. (QIA:TSX.V)</a> is No. 6 with 3,920,000 shares; <a href=”http://www.theaureport.com/pub/co/1315” target=”_blank”>Manson Creek Resources Ltd. (MCK:TSX.V)</a> is No. 17 with 1,679,500 shares; <a href=”http://www.theaureport.com/pub/co/1462” target=”_blank”>Currie Rose Resources Inc. (CUI:TSX.V)</a> is No. 18 with 1,500,000 shares; <a href=”http://www.theaureport.com/pub/co/2864” target=”_blank”>Crown Gold Corp. (CWM:TSX.V)</a> is No. 19 with 1,500,000 shares; Eskay Mining Corp. (ESK:TSX.V) is No. 20 with 1,460,000 shares; and <a href=”http://www.theaureport.com/pub/co/3451” target=”_blank”>Silver Predator Corp. (SPD:TSX)</a> is No. 22 with 1,395,000 shares. </p>

<p><b>TGR:</b> How significant is this data?</p>

<p><b>TD:</b> Actual volume is another good first screening, but most of the companies that appear here tend to be small. When stocks are light traders with market caps under $20M, you’ve got to do more homework to ascertain what might be motivating insider activity. Is this company a value proposition, or is something else going on? You want to take a good look at the company’s management and its cash position.</p>

<p><b>TGR:</b> <a href=”http://www.theaureport.com/pub/co/6214” target=”_blank”>Arian Resources Corp. (ARC:TSX.V; 0GT1:FSE)</a> closed a $2.78M private placement March 24. Of the 18M units sold, 800,000–that’s $120,000 worth–were bought by members of that company’s advisory board. What does this data tell us?</p>

<p><b>TD:</b> I can’t comment on a specific transaction, but, in general, when there are private placements you want to look at the terms. If they are reasonable, and management is participating, then it’s positive. But, of course, every deal is different, so that’s why we focus on public-market activity, which is more of a standard measure.</p>

<p><b>TGR:</b> Your Top 3 INK Edge Quick Wins Q4/13 has <a href=”http://www.theaureport.com/pub/co/579” target=”_blank”>Wesdome Gold Mines Ltd. (WDO:TSX)</a> at No. 3, up 50%. What can you tell us about this?</p>

<p><b>TD:</b> Our Morning Hour Report stocks use our INK Edge process, which looks at insider activity, valuation and price rank. We call it VIP criteria of valuation, insiders and price, and what we’re looking for is the stocks that have insider buying that are good value and have good price strength. That’s what we scour the market for every day.</p>

<p><b>TGR:</b> So based on your various indices, which stocks stand out in insider buying, good value and good price strength?</p>

<p><b>TD:</b> I’ll repeat the caution that investors should take a diversified approach. I’ve already mentioned Barrick, which ranks quite well on our screens. Looking at other stocks with high amounts of key insider buying as of March 24, the company with the second-highest amount over the last 30 days is <a href=”http://www.theaureport.com/pub/co/3698” target=”_blank”>Endeavour Mining Corp. (EDV:TSX; EVR:ASX)</a>; it also has a mostly sunny outlook according to our INK Edge, which puts it in the top 30% of all stocks ranked. </p>

<p><a href=”http://www.theaureport.com/pub/co/4020” target=”_blank”>Teranga Gold Corp. (TGZ:TSX; TGZ:ASX)</a> is also in our top 30% of all stocks ranked. It has a mostly sunny INK Edge outlook. Arian Resources is No. 4 in insider buying and <a href=”http://www.theaureport.com/pub/co/2056” target=”_blank”>Amarillo Gold Corp. (AGC:TSX.V)</a> is No. 5. But we do not rank the last two stocks due to their small sizes. These might be stocks for investors with very high risk tolerances to take a look at. </p>

<p><b>TGR:</b> Ted, thank you for your time and your insights.</p>

<p><i><a href=”http://www.theaureport.com/pub/htdocs/expert.html?id=9254” target=”_blank”>Ted Dixon</a> is co-founder of INK Research (Insider News and Knowledge), Canada’s first online financial news and research service dedicated to providing data on public company insider trading. (Free services are found on CanadianInsider.com and InsiderTracking.com.) He worked previously for Connor, Clark &amp; Lunn Financial Group in portfolio strategy and product development, the Fraser Institute as an analyst, TD Bank as a treasury specialist and the Vancouver Stock Exchange as a floor trader. He has lectured in corporate finance at the BC Institute of Technology and is a Chartered Financial Analyst and member of CFA Vancouver. He holds a Master of Business Administration in financial management from the University of Chicago.</i></p>

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<p><b>DISCLOSURE:</b> <br />
1) Kevin Michael Grace conducted this interview for Streetwise Reports LLC, publisher of <i>The Gold Report, The Energy Report, The Life Sciences Report </i>and <i>The Mining Report,</i> and provides services to Streetwise Reports as an independent contractor. He owns, or his family owns, shares of the following companies mentioned in this interview: None. <br />
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Capital Trust Markets – Early this week, a number of key Japanese fundamental data will offer insight into the state of the Japanese economy. Trade and monetary policy is in the spotlight, as traders and investors continue to scrutinize the effect of the ongoing aggressive Japanese stimulus package. The package looks to be working, but looking a little deeper, is Japan heading for trouble?

First, a short history lesson. The lost decade, or two decades, depending on who you ask, have been covered in depth, but it’s worth a quick recap to introduce the situation. In short, throughout the 1970s and 1980s in Japan, low interest rates and excessive monetary easing fueled a huge speculative asset bubble. House prices, land prices and stocks boomed to unsustainable levels, and in response, the Bank of Japan raised interest rates sharply. The raise caused a wave of default, which led to the effective collapse of the Japanese financial system. The collapse fueled a sustained period of deflation, pretty much right the way through until 2012. At the end of 2012, Japan appointed Shinzo Abe as its Prime Minister, and things started to change. His “three arrows” policy, combining fiscal stimulus, monetary easing and structural reforms has started to tackle deflation, and many suggest he is responsible for helping Japan avoid prolonged and serious recession.

However, some have suggested all is not as it seems. Proponents of Abe’s policies point to the increase in CPI starting from June last year as a signal of Abenomics’ effectiveness. Yes, inflation has returned, but core inflation, is still a way behind its raw data counterpart. Why? As is so often the case, it’s all about supply. The nuclear power accident in Japan led to a closing of all the nation’s nuclear stations, which means it is no longer self-sufficient in terms of power production. This shortage of supply (coupled with the increased cost of imported energy as a result of the weakened Yen) increases energy costs, which distorts CPI.

Another problem comes from the increasing government debt. Japan’s current gross public debt is approximately $10T, equating to about 250% of its GDP. Couple this with Japan’s famously aging population (and the near term pension levels this infers), and you get the makings of a potential crisis. An April sales tax hike, from 5%-8%, it intended to counter this potential crisis, but it could just as easily damage consumer spending. Slowing consumer spending could undo the positives of Abenomics and, once again, send Japan into a drawn out deflationary period.

To add balance, Abenomics has sparked an increase in employment, a booming stock market, increased industrial production and rising GDP. In short, all is not doom and gloom. However, traders need be aware that aggressive expansionary policy has consequences, and it can only be a matter of term before they surface.

Written by Samuel Rae – Currency Strategist at Capital Trust Markets

Capital Trust Markets is a fully regulated and compliant online Forex Brokerage, offering a flawless trading environment to traders of all types. The world class trading infrastructure – backed up by advanced trading tools and cutting edge trading software and technology – is combined with award winning customer support to provide a highly successful blend of customized trading solutions.

Article by Investazor.com

USDJPY had a flying evolution for the first four days of the week and managed to establish a two month high above 104.00 level. Friday was the day the investors were waiting for because the NFP report had to be published. The new jobs created were more than the last month, but below the expectations, so the US dollar was hurt and USDJPY fell, closing the week at 103.24.

The Japanese yen suffered losses last week because the macroeconomic data were pretty disappointing. The Manufacturing PMI came lower than last month with a 53.9 reading. The industrial production was published with a reduction of -2.3% whereas the forecasted value was an increase of 3.6%. The Housing Starts fell from +12.3% in February to just +1% for March. In the meantime, the American economy seems to recover from the sluggish start it had at the beginning of the year while the stock markets are at new all-time highs.

Economic Calendar

Leading Indicators (06:00 GMT)-Monday. This index is designed to predict the direction of the economy, but it tends to have a muted impact because most of the indicators used in the calculation are released previously. Last month published above expectations with a value of 113.1% and for this week is estimated a value of 114.2%.

Current Account (0:50 GMT)-Tuesday. This indicator measures the difference in value between imported and exported goods, services, income flows and unilateral transfers during the reported month. It has a medium impact on the markets, so it will be very interesting to watch it closely as the current deficit is at all-time highs. For this month is estimated a deficit of -0.04T whereas last month we had a deficit of    -0.59T.

Monetary Policy Statement & BoJ Press Conference (Tentative)-Tuesday. These two monthly events have a high impact on the markets because it is among the primary tools the BoJ uses to communicate with investors about monetary policy and the Press Conference always brings some serious volatility. It is written Tentative because it was not established yet the exact hour, which will be communicated Monday.

Economy Watchers Sentiment (06:00 GMT)-Tuesday. It is an index based on surveyed workers who directly observe consumer spending by virtue of their job. Above 50.0 indicates optimism, below indicates pessimism. For March it is expected an improvement as the forecasted value is 54.1, so pay attention to it as for the last two months it came below expectations.

Core Machinery Orders m/m (0:50 GMT)-Thursday. This is an important indicator for the Japanese economy as it represents the change in the total value of new private-sector purchase orders placed with manufacturers for machines, excluding ships and utilities. It is a leading indicator of production and for April it is expected to decrease with -3.2% which would create a big difference as in March was published an increase of 13.4%, so it has big chances to create some volatility. 

Technical View

USDJPY, Daily

Support: 102.80, 102.00

Resistance: 104.00, 105.00

Last week we were talking about a descending trend that seems to take some shape, but the price seems to have other opinion. Monday, the quotation managed to break the descending trend line and closed the day above it. Then, the price continued the ascending path and scored a higher high after a couple of weeks ago it made a higher low. So, on the daily chart we have to see if the price will reject from the descending trend line and it will move further for a new higher high above 104.00.

USDJPY, H1

Support: 103.00, 102.55

Resistance: 103.60, 104.10\

On the hourly I drew a Fibonacci retracement on the ascending impulse after Friday the US dollar fell. The quotation stopped around the 50.0 Fibonacci level which means the bears were really strong. Also, the RSI on 14 periods is on the oversold zone while the MACD Histogram gives some recovery signals as the power of the bears is getting weaker. So, on this timeframe I expect to see a retest of the resistance line from 23.6 Fibonacci level and the bulls to regain the control.

Bullish or Bearish

Overall, there are high chances to see a moderately ascending path for the USDJPY next week as the American economy fundamentals seems to be viewed as bullish from the investors’ side while the Japanese economy is having right now a slowdown. The most important event of this week is the BoJ Press Conference, so I think the speech governor Kuroda is going to deliver Tuesday can give the price a direction.

The post USD/JPY Forecast For April 7 – 11 appeared first on investazor.com.

Article by Investazor.com

NZDUSD had the downfall we were warning about last week, but the bulls were hard to beat as the ascending trend continued Monday and Tuesday the 0.8700 level was hit. From that point all went downhill as even the macroeconomic data for New Zeeland did not help at all. The Building Consents fell with 1.7% which did not stop the investors to push the quotation higher.

Then, the ANZ Business Confidence indicator came with a reading of 67.3, which was lower than last month, so this was another disappointment. Also, the ANZ Commodity Prices m/m indicator was -0.1%. Eventually, the bears grew stronger and managed to push down the price around 0.8515 on Thursday. Then, the Friday came in with a worse than expected NFP and the price went up and closed the week around 0.8586.

Economic Calendar

NZIER Business Confidence (23:00 GMT)-Monday. This is a high impact indicator which is released quarterly and it is considered a leading indicator of economic health. The index is based on surveyed manufacturers, builders, wholesalers, retailers and service providers. Last quarter was published at 52 level which was the best reading in the recent years, so pay attention to it as it will cause some volatility.

Business NZ Manufacturing Index (23:30 GMT)-Wednesday. This is a medium impact indicator and is based on surveyed manufacturers. Above 50.0 indicates expansion, below indicates contraction. Last month was 56.2, so it is important to keep an eye in this indicator to see if the economic expansion from New Zeeland continues.

REINZ HPI m/m (10^th-14^th)-Wednesday. It measures the change in selling price of all homes. It is a leading indicator of the housing industry’ health because rising house prices attract investors and spur industry activity. Source does not have a reliable release schedule and this is why it is listed with a date range.

FPI m/m (23:45 GMT)-Thursday. It measures the change in the price of food services purchased by households. Although food is among the most volatile consumer price components, this indicator garners some attention because New Zeeland’s major inflation data is released on a quarterly basis. Last month was -1%, so this indicator will have its share of attention from the investors and may cause some volatility.

Technical View

NZDUSD, Daily

Support: 0.8515, 0.8425

Resistance: 0.8635, 0.8700

The three bearish signals we were commenting about last week finally got validated by the markets and the price had a downfall touching the first price target of the rising wedge we drew in the previous weekly forecast analysis. Still, the MACD Histogram shows us that the bulls should not be underestimated, while the RSI is on a neutral zone. This week we could see the price trading in the range between the 0.8515 support line and 0.8635 resistance line. Also, at the end of the next week we may see a Head&Shoulders pattern if the high from 0.8700 is not reached.

NZDUSD, H1

Support: 0.8515, 0.8480

Resistance: 0.8635, 0.8700

The hourly chart can be better viewed through the MACD Histogram and the RSI as these indicators point towards a potential retracement. The RSI is exactly at the overbought level while the MACD shows how the bulls are taking a break for the moment. So, on this timeframe you should watch for a falling price around the support level from 0.8515.

Bullish or Bearish

For the next week I see an equal battle between bulls and bears, creating a trading range. The party that will prevail, however, it will do at a very narrow margin. So, I expect this coming week to give NZDUSD a more clear direction for the period that will come. Overall, the sentiment is turning from bullish to a moderately bullish and after this week we can see it in the bearish territory.

The post NZD/USD Forecast For April 7 – 11 appeared first on investazor.com.

AUD/JPY has been in a strong uptrend since early February. Since then the pair has completed three impulsive waves, respecting the boundaries of the current bullish channel all too well.

A deeper pull back within the channel, to test the support and form a higher low in the uptrend configuration, has been signaled on Friday when price formed a Pin bar candlestick pattern. This bearish price action pattern formed following the touch of 96.50 and the channel resistance. Daily stochastic is in overbought territory, so this retracement is very much due at this point.

On the 4H timeframe price is approaching the 50 Simple Moving Average at 95.38. This is the first minor support, where the drop can stall until later today when the NBA Business Confidence report is released together with Bank of Japan Monetary Policy statement.

Below 95.38, the bearish move should target the 94.50 pivot zone and 38.2% Fibonacci retracement for the 91.29 – 96.50 impulsive wave. Further down 93.90-94.10 shows decent support confluence, yet the strongest confluence is located around 93.30, where Fibonacci retracement levels from all three impulsive waves converge. If AUD/JPY will correct all the way to the support of the channel in the next two weeks, 93.30 will end up being the main target.

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Prepared by Alexandru Z., Chief Currency Strategist at Capital Trust Markets

EURGBP- With EURGBP triggering a recovery following its flat close on Friday, the risk is for more upside strength to occur. As long as it holds above the 0.8245/49 levels, our corrective upside view remains intact. On further recovery higher, the 0.8300 level will be targeted where a breach will aim at the 0.8350 level and subsequently the 0.8400 level. On the other hand, below the 0.8245/49 levels if seen will turn focus to the 0.8200 level where a violation will shift attention to the 0.8157 level. Further downside support comes in at the 0.8100 level. All in all, the cross remains biased to the downside short term but faces recovery risks.

Article by www.fxtechstrategy.com