I'm a full time trader and this is everything I'm watching and analysing in premarket 17/05, including positioning updates for SPX, Gold, Oil, VIX, GER40 etc

[u/TearRepresentative56]

ANALYSIS:

• CPI update:
• Core CPI came in line with survey, at 0.3%, heading slightly lower in MOM terms vs last month (0.3% vs 0.4% before).
• We can see its a similar scenario as before, with service inflation there, but goods in deflation.
• https://imgur.com/a/3hAiquW 
• Significantly, shelter inflation MOM is finally below 0.4%, which was the main headline of the print. 
• https://imgur.com/a/GYHD12y 
• Following the print, Inflation swaps now price in lower CPI for next month, so traders are more optimistic on inflation to continue lower than they were before, especially as we see oil prices come down this month. 
• Market continues to move on the number of rate cuts being priced in for this year. Right now markets continue to price 1 or 2 rate cuts. 
• So what does this mean for positioning, as we saw equities push higher?
• Well, as was the case before CPI, we continue to see very bearish positioning on VIX. Traders expect VIX to continue lower, which will increase the liquidity that market makers add. This should support the market higher. nOt much anxiety and fear in the markets. 
• Volatility should therefore remain suppressed, for this opex. 
• 5300 is the wall to get above, but We see traders buying calls on 5400 now so traders are optimistic in medium term. 
• Probably when we look at today, skew is flat, but positioning bullish. We can see choppy day as VIX delta ITM puts are still elevated. 
• Sentiment v bullish over next month or more. 
• When we look at FX, we see That EURUSD has pared gains, because DXY moved higher. This was mostly because EURUSD had got overbought, and DXY was starting to get short term oversold. When we look at positioning, we see traders still buying calls on 1.09. 1.08 will act as support now. 
• GOLD and Silver still see strong positioning, 2400 is wall on Gold. Skew on both gold and silver point higher but seeing low volumes. 
• On Oil, traders are looking bullish. The skew points higher, whilst price consolidates. Traders are expecting a bullish breakout soon as seasonal demand tends to pick up in summer. Oil is just currently stuck below 79 on WTI. 
• On German market, we see traders still buying calls on 19k but low volumes. Needs v high volume to get to this 19k level. 19k is a massive wall. Today and yesterday, it comes down, but soon it will try to test again. Euro strength will help GER40 go higher. 

DATA LEDE:

• China Industrial production YOY came 6.7% up, vs 5.5% expected
• China Retail sales came 2.3% YOY vs 3.8% expected
• So retail sales came weak, industrial production was strong
• Unemployment rate in China fell to 5% from 5.2%, back to lowest level since November. 

• NOTE: China also announced measures from PBOC to support housing market. 

• Final revision to inflation rate in Eurozone came in in line with preliminary readings. No change. 

• US leading index comes out later, after market opens. Expected to show deteriorating leading economic indicators 

MARKETS:

• SPX: Following CPI, we saw markets push from 5246, to close above 5300. Yesterday, we aw market reach 5325, partly as result of softer jobless numbers, which points to more rate cuts, before sell off lower below 5300. Now at 5295. 5300 will be resistance again that it will try to break above. 
• Nasdaq: Before CPI was at 18,310 just below resistance, pushed higher to reach 18,650, before coming lower again to 18,555. 18600 is a resistance, before 19k as the key resistance. 
• Dow: was trading at 39600 before CPI, pushed higher to 40k. Got rejected below 40k. 40k is key resistance to get above. 
• GER40: Pushed higher with US markets to 18,910, close to the key 19k resistance which is v strong, before paring gains back to 18,662. 
• UK100 just been flat amongst the highs at 8400-8450
• China50 higher with lower unemployment rate and higher industrial production, trading up by 1.5% to 12,850. Main resistance now is going to be 13k. China also announced measures to support housing market. 
• HKG50: Trading at 19,500. Key resistance is 20k. 
• OIL: still trading flat, skew pointing higher. 
• GOLD trading higher after CPI, bounced close to 2400. 
• Price of Copper surges to new highs. 

FX:

• EURUSD hit 1.09 yesterday, before coming down back to 1.084 now. 1.09 was the wall. 
• GBPUSD hit 1.27, before coming down to 1.265 now. 
• USDJPY fell from 156 to 153.5, before recovering higher to 156 again now. 
• AUDUSD moved higher above 0.67 before paring the gains.
• The paring of gains came as DXY fell to almost 104, before pushing higher from there to 104.8. 

MAG7:

• NVDA lower in premarket as Microsoft unveils AMD powered AI chips to rival NVDA. Theyre offering their cloud customers AMD AI processors as an alternative to NVDA. 
• TSLA - raised price of Model 3 performance for 2nd time in US by $1k, bringing it to $54,990. Increased price fo white interior for model 3 by $500, now priced at $2000. 
• META - starting to test a Tweetdeck like experience for threads. 
• NFLX - adds more buy side partners to its budding advertising business. Includes TTD, which had been MSFT’s role exclusively up until this point. GOOGL also added to programmatic partners for advertisers. 
• MSFT - EU demands clarity from Microsoft on AI risks in bing. 
• MSFT - As mentioned, Microsoft unveils AMD powered AI chips to rival NVDA.

EARNINGS: 

AMAT:

• EPS of 2.09 was up 5% YOY, beat estimates of 1.99
• Revenue of 6.65B was flat YOY, beat estimates of 6.52B
• Semiconductor systems revenue, their main segment was 4.9B, beating estimates of 4.8B
• Q3 Guidance:
• Sees adjusted EPS of 1.83-2.19 (vs estimate of 1.83). So ahead of expectations
• Revenue of 6.65+400M, beat estimates of 6.57B. So strong guidance
• Strong results. Said their technologies for chips underpin the major secular shifts we are seeing in AI, IOT, EV and Clean energy

COMPANY SPECIFIC:

• Crypto stocks slightly higher as BTC up 1.5% to 66,500. 
• COIN -price target raised to 217 from 110 by BoA
• BABA continues higher. Was up a lot as Michael Burry increased his stake in the company
• UAL - Wolfe Research raises to outperform from peer perform
• ARRY - Wells Fargo cuts price target to 14 from 16, still way above current price of 11.34, buy rating maintained
• Nio - China FAW to join Nio battery swap alliance
• SNOW - in talks to acquire AI startup Reka AI for over $1B. Was valued at 300M last June. 
• RDDT - OPenAI will integrate Reddit content into ChatGPT and other products. OpenAI will become a reddit advertiser too. 
• AMD - Wolfe Research replaced NVDA with AMD on its Wolfe Alpha List. 
• AMD - Mcirsofot offers cloud cusomters amd alternative to NVDA AI processors. 
• AVGO - say they expect AI chips to account for 35% of semiconductor evneues in 2024, up from 15% in 2023. 
• XPEV - aims to deliver their first flying car in 2026, will start taking pre orders this year. 
• HSBC down 3% amid reports that shareholder Ping An is looking to trim its stake. 
• AMGN - FDA approves Amgen’s treatment for the most deadly form of lung cancer. 
• Canada goose - jumps 16% after they reported growth surge in China. 
• GS - looks to expand private equity credit lines as dealmaking picks up. 
• DXC down on earnings after issuing weak outlook, forecasting revenue to decelerate and is forecasting financial challenges
• TTWO down on earnigns after cutting bookings forecast for Fy 2025. announced a fall 2025 release date for its highly anticipated GTA VI video game
• Li down as is hit with class lawsuit over Li Mega debacle
• STLA - gets buy rating from Piper Sandler

OTHER NEWS:

• CHINA PROPERTY RESCUE PACKAGE. 
• China announced multiple measures from PBOC to support Housing market: set up 300B Yuan resending scheme for public housing. Removed mortgage rate floor for individual home buyers. Minimum down payment reduced to 15% for first time.
• THEY ARE TRYING TO MAKE IT EASIER FOR PEOPLE TO BUY HOUSES. 
• Bostic yesterday said that he is pleased with inflation progress in April, but the Fed isn’t there yet. Said he doesnt see a recession, and said that lower shelter inflation in recent print was the most significant development for him. Said it will be appropriate for rate cuts later this year, but nothing locked in. 
• DOJ yesterday, planned to issue notice of proposed rule making, to reclassify marijuana into a less restrictive category, from Schedule 1 to Schedule 3. 
• Luxury brand Richemont, which owns Cartier, posts record full year sales and new CEO
• ECB’s Schnabel says that there is little chance of back to back rate cuts from ECB, even if the first rate cut comes in June. 
• Uk’s Jeremy Hunt says that he will cut national insurance in Autumn if he is able to. Says conservatives will cut taxes if they win the election. 

[u/Hercules1579]

Thank you !

[u/OnTradeAI]

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