Wednesday, September 19, 2018

PHP Exchange Rate & PH Stock Market Outlook 2

In response to requests
As of Sept 19-20, 2018
PHP Exchange Rate & PH Stock Market Case Scenario based on Facts & Data
A Decision where Investors should make a stand! 

The PSEI previous market recovery can now be called a 'dead cat bounce' as we have made mention that diagonal uphill climb towards the 7880/81 levels twice would not be a full recovery. The remerging US - China trade war spat, foreign investment outflows other than inflation pressures have come at terms with regional peers to do the same market reaction.
 
The PHP exchange rate is relatively down against the USD as much as -13.63% for the past 3 years. While on a YOY basis it is -5.46% compared to a YTD at -7.23%. Now with inflation at 6.4% from the recently released data and the PH Stock market index at 7221.23 equivalent to a -15.62% YTD level decline, nearing the -18.12% loss when the PSEI was down to 6929/86 last June 25, 2018. 


But with the current day's low at 7189 as of 9.20.18 Asia session, the question is how much further does the index have to go where the equivalent component's mix prices have gone lower from their previous registered low? 

With that said, how much do you think should the market recover to for retail investors to make a decent return on their equity investments? Meanwhile investors / traders still have to pay an adjusted tax increase for every trade done

Discussing these facts is already a given. What needs to be done is to have the right trading solutions and be prepared for the next turn around. 

Although, these figures may be pessimistic; being optimistic there is still a probability of a turn around once the numbers that we are expecting the market to mark by the 4th quarter entry be reflected. But until such data and figures shows we would not want to speculate on a full turn around unless certain narratives changes that would provide the major catalyst to turn the PH market higher without resorting to window dressing for clients benefit.    

To find out where and how should we make a stand...Come & Join us from our 'Relative Series of Progressive Sessions' at the Coffee Project EVIA. Click on the link to sign up!

AUDUSD Gains Ground with EURO & CABLE 2

Finally, AUDUSD have started to regain its ground after most investors have swayed much stress over the retaliatory action s of China against the additional US trade tariff imposed by President Trump. The same manner that US equities have continued its pace to record levels after a minor corrective move led by the triple digit climb of the DOW above 26200. Meanwhile, this is also against a backdrop from US 10 year treasury yields that has posted above 3.00% in the US session. 


The AUDUSD price currently at 0.7230 is actually half way through its initial objective that still needs to build more momentum when it passes through above the 0.7280-0.7350. A clear objective of over 200 pips from its registered low at 0.7085.  Which was signaled from an opening gap & extension low that triggered the first round of short-covering  The technical perspective which we presented from the previous overlay chart can now justify that the bullish Gartley price pattern once completed would provide the final confirmation for a bounce. This is also where 'Patience is a virtue' when it comes to trading volatile markets.

This maybe encouraging for swing traders, on the contrary the 2nd objective may still prove to be some distance ahead. Which could easily result similarly to a 'dead cat bounce' if prices would not be accompanied with substantial volumes that would drive it past the 2nd objective. For now the current price swing higher to these levels are good. Especially, when the Australian Dollar got some additional support from their previous strong job data. There will always be a matter of trading  'CORRELATION' directly or indirectly when it comes to the financial markets.

Meanwhile, EURO got some initial relief from CABLE's previous weakness, but both currency pairs have remain firm to higher with the USD softness at this time. The way we approach its weakness for now is quite independent as it would likewise be used as a buffer strategy that once the FED raises rates the USD would be coming from its low pre-adjusted levels coming into the 4th quarter 2018. And this would be well in line with our projection for 10 year US yields to stay above 3% and relatively closer to 3.35% presumed range objective in the near-to-mid term quarter of 2019.