A.I. Range forecast for 30-Nov-2020 [Popular pairs against JPY]

A.I. Range forecasts of popular pairs against JPY until the end of Monday (UTC). For some whose last Trend and Momentum have been better fitted, their figures are also available below.

Japan is one of the biggest markets where FX trading is active among the private and corporate investors.

[AUDJPY]

Range forecast: 76.414 (-0.59%)  -  77.321 (+0.59%).

Confidence: 74.6%.

The chance of Downside swing is more considerable.

[EURJPY]

Range forecast: 124.1 (-0.34%)  -  124.64 (+0.1%).
Confidence: 71.6%.
The chance of Downside swing is more considerable.

[GBPJPY]

Range forecast: 138.12 (-0.31%)  -  138.6 (+0.04%).

Confidence: 73.9%.

The chance of Downside swing is more considerable.

[USDJPY]

Range forecast: 103.59 (-0.49%)  -  104.26 (+0.15%).

Confidence: 69.9%.

The chance of Downside swing is more considerable.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

A.I. Range forecast for 26-Nov-2020 [AUDJPY | EURGBP | EURNZD | EURUSD | GBPUSD | USDJPY]

The range forecasts of selected FXs for next 24h. The time-line is based on UTC as usual.

[AUDJPY] To the QROSS X Trend and Momentum

Range forecast: 76.409 (-0.43%)  -  77.144 (+0.52%) , for next 24 hours.
Confidence: 73.7%.

[EURGBP] To the QROSS X Trend and Momentum

Range forecast: 0.88877 (-0.28%)  -  0.8943 (+0.34%) , for next 24 hours.

Confidence: 69.7%.

[EURNZD] To the QROSS X Trend and Momentum

Range forecast: 1.6953 (-0.29%)  -  1.704 (+0.22%) , for next 24 hours.

Confidence: 74%.

[EURUSD] To the QROSS X Trend and Momentum

Range forecast: 1.187 (-0.28%)  -  1.1951 (+0.4%) , for next 24 hours.

Confidence: 73.2%.

[GBPUSD] To the QROSS X Trend and Momentum

Range forecast: 1.3329 (-0.18%)  -  1.3419 (+0.5%) , for next 24 hours.

Confidence: 74.4%.

[USDJPY] To the QROSS X Trend and Momentum

Range forecast: 104.12 (-0.13%)  -  104.48 (+0.21%) , for next 24 hours.

Confidence: 72.8%.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

A.I. Range forecast for 23-Nov-2020 [AUDJPY | EURGBP | EURUSD | GBPUSD | USDJPY]

The range forecasts of selected FXs for 24h from the next market opening. The time-line is based on UTC.

[AUDJPY] To the QROSS X Trend and Momentum

Range forecast: 75.643 (-0.22%)  -  75.968 (+0.21%) , by the end of Monday.
Confidence: 71.9%.
The chance of Downside swing is a little more likely than Upside.

[EURGBP] To the QROSS X Trend and Momentum

Range forecast: 0.88843 (-0.41%)  -  0.89316 (+0.12%) , by the end of Monday.
Confidence: 65.5%.
The chance of Upside swing is more considerable while Upside margin is limited.

[EURUSD] To the QROSS X Trend and Momentum

Range forecast: 1.1838 (-0.16%)  -  1.1885 (+0.24%) , by the end of Monday.
Confidence: 66.3%.
The chance of Upside swing is more considerable.

[GBPUSD] To the QROSS X Trend and Momentum

Range forecast: 1.3148 (-1.06%)  -  1.3354 (+0.49%) , by the end of Monday.
Confidence: 66%.
The chance of Upside swing is more considerable while Upside margin is limited.

[USDJPY] To the QROSS X Trend and Momentum

Range forecast: 102.96 (-0.83%)  -  104.49 (+0.64%) , by the end of Monday.
Confidence: 68.5%.
The chance of Upside swing is more considerable.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

A.I. Range forecast + Trend and Momentum for 18-Nov-2020 [EURJPY | GBPJPY]

Here are the forecasts for EURJPY and GBPJPY respectively as their Trend and Momentums are well fitted this time. The range forecast is for next 24 hours.

[EURJPY] To the QROSS X Trend and Momentum

Range forecast: 123.14 (-0.27%)  -  123.84 (+0.3%) , for next 24 hours.
Confidence: 74.2%.
The chance of Downside swing is a little more likely than Upside.

[GBPJPY] To the QROSS X Trend and Momentum

Range forecast: 137.68 (-0.32%)  -  138.93 (+0.58%) , for next 24 hours.
Confidence: 75.6%.
The chance of Downside swing is more considerable.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

A.I. Range forecast for 13-Nov-2020 [EURGBP | EURUSD | USDJPY]

The range forecasts for selected FXs until around the Monday afternoon. The time-line is based on UTC.

[EURGBP]

Range forecast: 0.89604 (-0.28%)  -  0.90099 (+0.27%) , until around the Monday afternoon.
Confidence: 63.7%.

The chance of Downside swing is a little more likely than Upside.

[EURUSD]

Range forecast: 1.1803 (-0.17%)  -  1.184 (+0.14%) , until around the Monday afternoon.
Confidence: 63.8%.

The chance of Downside swing is more considerable.

[USDJPY]

Range forecast: 104.55 (-0.15%)  -  104.92 (+0.21%) , until around the Monday afternoon.
Confidence: 69.6%.

The chance of Downside swing is a little more likely than Upside.

A.I. Range forecast + Trend and Momentum for 13-Nov-2020 [AUDNZD | GBPCAD | CHFJPY]

 The range forecasts for selected FXs until the end of Monday morning. The time-line is based on UTC.

[AUDNZD] To QROSS X Trend and Momentum

Range forecast: 1.0585 (-0.29%)  -  1.0652 (+0.34%) , until the end of Monday morning (UTC).
Confidence: 75.8%.

[GBPCAD] To QROSS X Trend and Momentum

Range forecast: 1.7235 (-0.34%)  -  1.7398 (+0.6%) , until the end of Monday morning (UTC).
Confidence: 72.3%.

[CHFJPY] To QROSS X Trend and Momentum

Range forecast: 114.38 (-0.23%)  -  114.88 (+0.21%) , until the end of Monday morning (UTC).
Confidence: 73.8%.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

Why the internal market bill is controversial in Brexit-deal?

The last September, UK politics reopened arguments about the Brexit-deal by introducing an internal market bill which could potentially breach the international law. It was a bit sensational as former PMs, including David Cameron and Theresa May joined to condemn the bill.

BBC news: Fifth ex-PM speaks out against post-Brexit bill

David Cameron has become the fifth former prime minister to criticise a new bill attempting to override the Brexit withdrawal agreement.

No 10 says the Internal Market Bill was a "critical piece of legislation for the UK".

But Mr Cameron said he had "misgivings" over it and breaking an international treaty should be the "final resort".

Former Tory PMs Theresa May and Sir John Major, and Labour's Tony Blair and Gordon Brown have condemned the plan. 

Since then, most of the critics focused on the government's attempting to override the Brexit withdrawal deal and a possibility of breaching the international law. But it seems little is said about how the controversial bill could fail to abide the law.

It is a little patchy information below but it is basically about the Northern Ireland Protocol preventing a hard border between Northern Ireland and Irish Republic.

BBC news: Brexit: Ministers plan laws overriding part of withdrawal deal

Meanwhile, the government will publish its Internal Market Bill - designed to protect trade arrangements between the four parts of the UK - on Wednesday.

This could contradict the Northern Ireland Protocol, set up to prevent a hard border between Northern Ireland and the Irish Republic, which many fear could be detrimental to peace.

The protocol says Northern Ireland will follow some EU customs rules - meaning customs declarations for goods moving from Northern Ireland to Great Britain, as well as some new checks on goods going from Great Britain into Northern Ireland - after the transition period.

The Financial Times said the bill would "eliminate" the legal force of the Withdrawal Agreement, struck less than a year ago between the UK and EU, in areas including state aid and Northern Ireland customs.

On the other hand, what the new bill rules:

BBC news: What is the row over UK 'internal markets' all about?

Right now, the UK is part of the European single market, with jointly agreed regulations and standards right across the continent.

Post-Brexit, the UK government wants to continue to have a joint market across England, Scotland, Wales and Northern Ireland - the "internal market".

But instead of the rules and regulations around things like food and air quality and animal welfare being set in Brussels, now they have to be set closer to home - and there is a row over who should have the final say.

Many powers are set to be directly controlled by the Scottish, Welsh and Northern Irish administrations, in fields including food labelling, energy efficiency and support for farmers.

However, the UK government has said the devolved administrations will still have to accept goods and services from all other parts of the UK - even if they have set different standards locally. 

The latter implies that Northern Ireland will have to accept some goods and services from the other administrations of UK regardless of the different quality standards on goods and services. The former says Northern Ireland will follow some EU customs rules so as to prevent the hard border between them and Irish Republic. Those lead to a conclusion that the argument arises because Northern Ireland will have to accept the goods and services from the other parts of UK, which do not complying with EU custom rules to be applied. Having sorted out so far, this is a substance of the argument about the internal market bill.

A.I. Range forecast for 2-Nov-2020 [AUDJPY | EURGBP | EURUSD | USDJPY]

The range forecast until the end of next Monday for some major FXs. The time-line is based on UTC.

[AUDJPY]  To QROSS X Trend and Momentum

Range forecast: 73.032 (-0.62%)  -  73.664 (+0.24%) by the end of next Monday.
Confidence: 74.1%.
The chance of Downside swing is more considerable.

[EURGBP]  To QROSS X Trend and Momentum

Range forecast: 0.89689 (-0.29%)  -  0.90848 (+1%) by the end of next Monday.
Confidence: 78.1%.
The chance of Upside swing is more considerable.

[EURUSD]  To QROSS X Trend and Momentum

Range forecast: 1.1625 (-0.18%)  -  1.1668 (+0.19%) by the end of next Monday.
Confidence: 68.3%.
The chance of Downside swing is more considerable.

[USDJPY]  To QROSS X Trend and Momentum

Range forecast: 104.26 (-0.34%)  -  104.75 (+0.13%) by the end of next Monday.
Confidence: 67.8%.
The chance of Upside swing is more considerable while the expected margin will be limited.

It is possible that the Trend and Momentum indicate the different direction against the A.I.'s review.

As many are aware, the US presidential election is being held on 3-Nov in US time. Financial markets, including FX, are possibly impacted according to the outcome. It must be kept in mind.

Regarding Brexit, the internal market bill is being scrutinized and voted in the House of Lords on 9-Nov. Since the bill includes some controversial clauses, there is a certain possibility the Peers could block the bill. It is 2 months to go until the transition period is over.

European currencies [GBP, EUR and CHF] are surging against JPY in a coming week?

As the major stock indices in US, European and some Asia-Pacific markets have sharply tumbled this week, their monthly declines are marking the worst in the last several months respectively.

Japanese yen which is typically considered as a safe haven has gained for the time, and the Trend and Momentums indicate some European currencies could bounce back against JPY in a coming week.

GBPJPY Trend and Momentum

EURJPY Trend and Momentum

CHFJPY Trend and Momentum

The time is based on Universal time (UTC).

[A.I.'s review (GBPJPY)]

Range forecast: 134.51 (-0.52%)  -  135.93 (+0.53%) until the end of next Monday morning.

Confidence: 74.7%.

The chance of Downside swing is still considerable by the end of next Monday morning. The swing risk will be neutralized after that time.

[A.I.'s review (EURJPY)]

Range forecast: 121.43 (-0.34%)  -  122.26 (+0.35%) until the end of next Monday morning.

Confidence: 71.5%.

The chance of swing is little biased toward any directions by the end of next Monday morning. Then, the Upside swing is more considerable by the end of next Wednesday morning, and the swing risk will be neutralized.

[A.I.'s review (CHFJPY)]

Range forecast: 113.07 (-0.72%)  -  114.35 (+0.4%) until the end of next Monday morning.

Confidence: 75.6%.

The chance of Upside swing is a little more likely than Downside by the end of next Monday morning. Then. the Upside swing is more considerable by the end of next Tuesday morning. 

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

EURJPY jumped since the beginning of this week. Is the trend being neutralized? 20-Oct-2020

EURJPY has surged since the market opening on Monday, which currently stays around 124.59. Reviewed our forecast as of last Friday, it could say that the realized trend has been consistent with the forecast.

Today's Trend and Momentum indicates there is still a room of EURJPY going up while the A.I.'s review tells that the trend will be more neutralized.

[A.I.'s review]

Range forecast: 124.23 (-0.31%)  -  125.08 (+0.37%) , for next 24 hours.

Confidence: 73.6%.

The chance of Downside swing is a little more likely than Upside in next 24 hours. It will turn slightly Upside by this Friday's morning.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

EURJPY surging in next week? Trend and Momentum + A.I.'s review 16-Oct-2020

 As the trend and momentum of EURJPY well fitted, it indicates EURJPY is expected to surge in next week.

[A.I.'s review]

Our A.I. forecasts a short term range as below:

Range forecast: 123.08 (-0.19%)  -  123.75 (+0.35%) , until 10:15, Mon 19 Oct 2020 (UTC).

Confidence: 77.8%.

It also tells swing risk is neutral for both directions by the end of today. The chance of upside swing is more considerable from next Monday to Tuesday. Then, the risk will be observed as neutral.

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

Australian Dollar surging in a coming week? Trend and Momentum 4-Sep-2020

The stock markets have well surged since last April despite Covid-19 having devastated in the world. It is most likely because of the excessive liquidity brought by central banks in major economies. Even though DJIA down more than 800 points yesterday, it is too soon to conclude the upward trend is over.

Back to the topic, the latest Trend and Momentum indicate Australian dollar could surge in a coming week after reaching the bottom. If you want to see the Trend and Momentums for other FX pairs, visit: QROSS X - Trend and Momentums.

AUDCAD Trend and Momentum

AUDJPY Trend and Momentum

AUDUSD Trend and Momentum

To check Forex trading signals on your Android devices, download Forex Signal by QROSS X.

Coronavirus outbreak was just an excuse and the worse will be coming to the market?

Vito Corleone (From Wikipedia)
The son of Antonio Andolini.

Don Ciccio had killed Antonio Andolini, and the Don was revenged by Antonio's son. At least, Don Ciccio was right about his future.

Don Ciccio:

...When he grows, he'll grow strong.  ...When he's a man, he'll come for revenge.

As written on the last post, the oil price digged further its bottom at which WTI crude oil contract for May reached in negative territory. Theoretically, the possibility of negative price is anticipated because of the shortage of oil storage. But I thought OPEC+ or US will prevent from the situation being worse.
Some says that hedge funds or speculators sold their holding contracts as the uncertainty of storage availability and its costs ahead.

The Irish Times: What do negative oil prices mean for the prices you pay at the pump?
... The reasons for this are complicated, but essentially for every barrel of oil consumed in the world, 30 are traded. This means that financial institutions and hedge funds are speculating now on the price of oil that will be delivered in May. Contracts for May had to be settled by April 21st, and with a raft of traders left with oil contracts on their hands in the face of extremely low demand, they were forced to offload their contracts at negative prices.

DJIA recovered since the end of March.

While the oil markets tumbled, the global stock markets have recovered since the end of last month. DJIA (Dow Jones Industrial Average) has recovered about 5,000 points (27.0%) though it is still over 6,000 lower than the record high.
Some big economies, including US and Germany, are trying to reopen their businesses as they have been suffering from the lockdown for a month. It maybe a positive sign for the market but the things are not so simple either.

What was the outlook of the financial markets before Coronavirus outbreak? The major stock indices were climbing to the historic high in recent years to decades. No one was thinking the Tokyo Olympic game would be postponed except for some conspiracy theorists.
But on the other hand, PMI numbers in the largest economies have already been in lower territory in which the outlooks were negative. German manufacturing PMI has been well below 50.0 since the beginning of 2019, and the numbers in Eurozone and Japan have been more or less similar to German one, too. UK has been struggling to get Brexit done for 2019 (since 2016). US economy has been relatively stronger than others while its PMI was also in downward trend.
While the stock markets were bullish, the real economies had started slow down even before Coronavirus outbreak. PMI is utilized as a leading indicator to forecast the economic confidence in coming months. As the PMI numbers were below 50.0 in 2019, the recent market crash could have some senses of the adjustment between the market and real economy. Coronavirus just triggered it, perhaps.
By the way, how about today's PMIs? In Eurozone, the manufacturing PMI is 33.6 as of Apr-2020, the lowest since the financial crisis 2008. The composite PMI, overview of service and manufacturing sectors, is overwhelmingly 13.5, the record low.
Reminding it is a leading indicator, the economy is expected to be worse in coming months as the impact of lockdown will be realized in our economies. When it did, we would see something worse in the financial market than the last one in 2008.

When the bubble grows, the bursting impact will grow stronger. When the time comes, it devastates the market and economy.

Where is the bottom of oil price? This uncertainty could be for months to years.

From Wikipedia

Dominic Greene:

Since 1945, 17% of the planet's vegetated surface has been irreversibly degraded. The Tierra Project is just one small part of a global network of Eco Parks that Greene Planet has created to rejuvenate a world on the verge of collapse.

The crude oil price has plunged as Coronavirus outbreak halted numerous businesses which consume the oils, and OPEC+ failed to agree on cutting oil production last month. Although the latest headline brought some hope as Saudi Arabia and Russia are expected to reach deal, there is still a room that the price is going down further until business is back to normal.

WTI Crude oil price
The lowest roughly in two decades.

According to World Oil: Trump may rent Strategic Petroleum Reserve storage to U.S. drillers,
The U.S. reserve, which was set up after the Arab oil embargo in the 1970s, has a maximum storage capacity of about 713.5 million barrels in salt caverns across the U.S. Gulf Coast. It now contains about 635 million barrels. The string of coastal salt caverns in Louisiana and Texas that comprise the reserve were designed for long-term storage and are not geologically suited for quick withdrawal of crude. For that reason, some industry observes have criticized the idea as ill-advised.

The considerations to make space in the reserve available come after congressional Democrats blocked a request by the administration to appropriate $3 billion in funds to buy as much as 77 million barrels of oil for its emergency stockpile in an effort by President Donald Trump to support the domestic industry and boost reserves at cheap prices.

It says almost 90% of storage capacity for the oil reserve is already filled up, which means the rest of capacity, only 10% can be available for the further reserve. Whoever US or US drillers will purchase the oil for strategic reserve, it cannot be kept without storage space. It is not clear that the oil companies can slash their output quickly. When the oil could go nowhere but consumption, the price would be down further.

Euro area's composite PMI
Hardly seen it less than 30...

According to the Coronavirus projection of United States as of 3-Apr-2020, it suggests number of new death cases can reach at the peak around middle of this April and the number will be zero near the beginning of August. It sounds some sense of relief during such gloomy days under lockdown. But there is another risk ahead as second wave of the virus can devastate again as China is facing.

The latest PMI, GDP forecast or any statistics indicate the worst outlook which is comparable with the last financial crisis in 2008 or even the great depression in 1929.

CITY A.M.: Coronavirus: Eurozone economy suffers record hit in March
The Eurozone economy suffered the biggest blow on record in March, survey data has shown, as coronavirus containment efforts all but stopped activity.

The IHS Markit purchasing managers’ index (PMI) – a closely watched gauge of the health of the euro area economy – crashed to 29.7 in March from 51.6 in February. A score below 50 indicates contraction.

It is still unclear if the current draconian measures enforced in leading countries of global economy are lifted soon. Actually, it is unlikely as risk of the second wave does not allow them to do so. The lockdown will continue, and people's activities will be strictly limited for months to years. Who wants to burn a lot of oil those time?

What can rejuvenate a world on the verge of collapse?

Coronavirus blasting all the goddamn markets

The Underboss (from Wikipedia)

The Godfather's son was so temper as he killed himself consequently.

Sonny Corleone:

... So why don't he just blast whoever's in the goddamn car?

Since the later last month, the global stock markets overwhelmingly plunged as if we are at verge of a new great recession or so. US's DJIA had the record drop yesterday at nearly 3,000 points. The commodity markets were also down.

While Fed finally set their target rate at around zero, the market reaction was pessimistic. First, the financial policy cannot be a breakthrough against the epidemic. Second, the investors woke up, recognizing how serious of the economic damage. Third, the stock markets were overvalued (Bubble) until Coronavirus outbreak.

Coronavirus brought anxious tension among people in the world where no one is virtually away from the threat of Coronavirus. Once it started spreading into the countries outside of China, the economic and social activities have gradually shrunk. Many events were banned. Bars or nightclubs were closed. Tougher boarder controls. Details of such rules are different between countries, but it continues for a month to a few months at least.

As mentioned in the last post, the airline operators are highly likely at risk because of non essential travel bans. The measure has escalated since then.

BBC: Coronavirus: Europe plans full border closure in virus battle
The European Commission is planning to ban all non-essential travel throughout Europe's Schengen free-travel zone as more countries close their borders to try to limit the spread of coronavirus.

Commission President Ursula von der Leyen said she would ask leaders to implement the measures on Tuesday.

"The less travel, the more we can contain the virus," she said.

FTSE 100
Financial crisis (2007 - 08), down 40% from peak

People are cashing out rather than holding shares, and some goes for panic buying. Even if shelfs in supermarkets become empty, you will see new stocks arrived there next day as far as supply chain works and production of goods continues. In other words, if the supply chain or production were limited or halted as the tougher measure, it could be disastrous. People rush to buy limited stock of foods, hygiene sprays or toilet rolls. Hyperinflation or stagflation could be possible in such situation.

FTSE 100
Last 2 years, down 33% from peak.
Another 10% brings larger dip than financial crisis 2007-08

When it comes to the financial markets, FTSE 100 was at 6,580 on 1-Mar and now marked at 5,217, about 33% down from the peak in last 2 years. During the last financial crisis in 2007-08, FTSE 100 was down by 40% from the peak. Today's market, the index has dropped 33% from the peak in less than a month. It looks just a matter of time until the latest crisis surpasses the one in 2007-08.


In the future when the world finally defeat the Coronavirus threat, financial markets and people's activities would be back in normal manners. But by that time, all the goddamn markets might be blasted in unprecedented scale.

Caporegime says: These things gotta happen every five years or so, ten years.

The Caporegime (from Wikipedia)

The Godfather had many friends with loyalty.

Peter Clemenza:

These things gotta happen every five years or so,... ten years. Helps to get rid of the bad blood. Been ten years since the last one.

In contrast with the consecutive downfalls of global stock prices in last week, it has been on a bumpy ride this week in US market particularly, partially because of Fed rate cut which was unexpected and little explained and Super Tuesday's outcome.

Meanwhile, it is a time to back in reality, isn't it?  After Fed rate cut and Mr.Biden's revival on Super Tuesday, there is no pragmatic solution combating Coronavirus. What is a kind of solution is a vaccine development whose production is expected after months to more than a year. So far, it looks good news are lasting and shadow of bad news ahead.

Flybe, one of the largest regional airlines in Europe, is dragged into administration. Even before the Coronavirus outbreak, Flybe has 40 years of its history and had expected to have a rescue deal to manage the difficult situation. Its employees' jobs are at risk.

China is pushing their business back to normal as much as possible, but the recovery is not enough for global economy. Outbreaks in other parts of the world are spreading faster and faster.
After all, consumers' demands are fading day after day as Coronavirus spread, except for panic buying at some supermarkets. The new James Bond film, which was planned to be released on April, was postponed until November.

The atmosphere surrounding the world is becoming reminiscent of the financial crisis in 2007-2008. The financial crisis 2007-2008 stemmed from credit crunch. The recent financial uncertainty is caused by the fear of epidemic and its economic effects. But the epidemic could not only lead travel industries including Airline companies like Flybe into the dark, but also cause domino effects in other industries, including financial industries.
Airline operators are financed through Structured finance, so called Aviation finance or Aircraft finance. They rise funds in both equity and debt for multi-billion dollars to purchase their Aircrafts to operate. The expected revenue is a source of the repayment and is supposed stable without such pandemics or wars. Reduction of the scheduled flights leads to their revenue cuts. Apart from the basic measures, business insurance or collaterals to avoid delinquency, they may have to cut labor costs. It has started already. (See below)

Sky News: Virus turbulence could give airlines cover to make cuts
Lufthansa, Germany's largest airline and the third-largest in Europe by stock market value, unveiled a cost-saving programme in which it will suspend new hires and offer employees unpaid leave in an attempt to mitigate the financial impact of coronavirus.
...
And it was revealed that KLM, which is the Dutch arm of Air France-KLM, Europe's fifth-largest carrier by market value, is to delay all IT and property projects that have not yet got underway and will be suspending hiring in certain departments.

Even such big names like Lufthansa and KLM struggle due to the Coronavirus outbreak, needless to say that the smaller operators suffer badly. In case that cost cutting is not sufficient, the subordinated debt repayments are first affected and the operator maybe forced into insolvent when senior debt repayments are failed. The insurance companies have to recover the loss, but the pandemic bring such unfortunes for virtually all the airline operators and travel related industries as chain effects. It can be a global credit crunch that we don't know the exact figure yet.

The financial markets have experienced some sharp up and downs for the last 10 years, but they are nothing more than the financial crisis 2007-2008, aren't they?  The Caporegime knows what happens now, perhaps.

Fed emergency rate cut. Coronavirus or Shadow of Mr.Sanders? 3-Mar-2020

Fed overwhelmingly announced 50bps rate cut today soon after the US stock market opened.
DJIA once jumped, reacting to the rate cut, though it stays nearly flat since the market opened. It seems be about the response to the market turmoil due to the Coronavirus crisis. But this sudden announcement is a little weird as such rate cut without anticipation tends to surprise the market, which should be avoided.

While today's news are dominated with Coronavirus, this is the Super Tuesday in US. The latest polls suggest that Mr.Sanders has the best chance to win, who is known of Social Democratic ideology. It can be a weigh on the stock prices shortly even though the likelihood is already priced in.

We'll know it.

Comment on 4-Mar-2020 Morning:

Regarding the current outcome of Super Tuesday, Mr.Biden earning votes remarkably, leaving Mr.Sanders behind. Meanwhile, DJIA future is also gaining, which implies today's opening values will be higher.

Godfather says: I spent my whole life trying not to be careless.

Godfather's discipline is worth not only for mafia nor yakuza but also for investors and traders.

Don Vito Corleone:

I spent my whole life trying not to be careless. Women and children can be careless. But not men.

Since the worst week for global stock markets, investors and traders should have been pessimistic under the market turmoil due to the fear of Covid-19 so called Coronavirus.
As the share price plunged overwhelmingly plunged last week, modest bounce back could have been expected at the beginning of this week. But how many of them could confidently foresee today's market swing, particularly in US markets where DJIA (Dow Jones Industrial Average) shot up above 5.0% in a single day?  There were some positive signs in the markets today, as Bank of Japan and Bank of England ensured their help for the Coronavirus crisis, and Mr.Trump slammed Fed "slow to act". Meanwhile, RBA (Reserve Bank of Australia) will be the first to have the rate decision at 2:30PM on 3-Mar (Local time). Some says that RBA will be forced to cut the rate because of the market turmoil, but US markets closed with huge recovery today and it became unclearer if RBA will cut or keep the rate.

While the markets turned positive today, we didn't get any breakthrough against Coronavirus. For a last few days, we were talking about supply chain problem, travel restriction and economic damage by them. Some says the global GDP could lose a quarter of the forecast even in "mild" scenario whose other scenarios are "modest" and "severe" respectively. The number of cases are now increasing outside of China, including Europe and US as concerned.

As more analysis results came out over the weekend, those mitigated uncertainty of the impact of Coronavirus. But negative outlook looms for coming months possibly beyond 2020. During the financial crisis in 2008, the markets had been down to the bottom on a bumpy ride. It is still likely to see the second round of massive sell-off near future, perhaps in this month again. Who knows?
That's why we have to learn from Godfather's discipline.

Tail risk factors emerging simultaneously?

Factorizing geopolitical tail risk into three factors, our old men would say Plague, Famine and War.
If we adapt today's situation into them ...

 Plague >> Coronavirus (Covid-19). Certainly serious now.
 Famine >> Supply chain problems, and goods vanish from super markets. (Due to possible city closures, transport restrictions, ... if Covid-19 spread faster globally.). Locust invasion in Africa.
 War >> Tension between Turkey and Syria. Afghanistan (It depends on whether the peace agreement is successfully proceeded.). ...

A lot of geopolitical issues have emerged since the beginning of 2020, of which Covid-19 is the most serious today. Today, few talks about a rich man who secretly escaped in the instrument box from the country where Diamond Princess cruise ship recently docked.

Seems little help the financial market as invisible Coronavirus surrounding globally 1-Mar-2020

Since the late last Friday to over the weekend, some good news and bad news are running the world. But as Covid-19 cases continue increasing globally, there is little sign mitigating uncertainty surrounding the societies.

Global stock markets have suffered from massive sell off, which is the worst since the financial crisis in 2008. Although Fed implied their rate cut in March and it recovered the US markets before closing on last Friday, more and more Coronavirus cases are confirmed day after day.

Apart from Coronavirus stories, US and Taliban signed a peace agreement on Staturday, which is a good news in those days. However, it is not good enough news to boost the current grim mood because it is unclear if the agreement actually bring a peace in Afghanistan for coming months. (The Guardian: US and Taliban sign deal to withdraw American troops from Afghanistan)
By the way, the market would little care about another good news of Mr.Boris Johnson's private.

FTSE 100
Financial crisis (2007 - 2008), down 40% from peak.

Traders are keen to the tomorrow's market opening of which Asian & Pacific market is on top. Even though the major global markets are closed, the weekend markets help to anticipate the next market opening.

Hong Kong HS50 (Hong Kong),
DAX 30 (Germany),
FTSE 100 (UK),
DJIA (US)
at IG group respectively.

FTSE 100
Last 2 years, down 16% from peak. Just a beginning perhaps...

Unless any breakthroughs are implemented, this economic stagnation would be just a beginning and it is too soon to hunt cheap shares. Japan's PM Shinzo Abe called unprecedented school closure in nationwide this weekend, and it will be effective from Monday tomorrow. No such announce has been called for workers yet while some parents who have small children are arguing about difficulty to take care of their children during the school closure. If the situation is becoming worse, it could be inevitable for the government to limit the economic activities and it will be certainly a critical damage to the vulnerable economy as Chinese economy is slowing down already.
European countries are also reacting to Coronavirus spreading by emergency measures, such as cancellation of public gatherings or stricter boarder controls. Travel agencies or flight operators must be affected pretty badly.
Of course, United State is not the exception. It just recorded a first death case by Covid-19 this weekend. US stock market has been strongest for last years, but it is not clear how much Fed rate cut could stop further panic in the markets.

Unlike the financial crisis in 2008, the coronavirus does not only crash the financial markets, but possibly cease the most of people's activity. Nobody wants such draconian measures taken in Wuhan, but nobody wants to be infected by Covid-19, either. In short term, people will demand mental care, rather than vaccine which it expects to take more than a year to be supplied.

Watch out Brazilian stock market on Wednesday, for the first opening this week

Global stock markets plunged for the last two consecutive days. While the scale was relatively smaller than yesterday in Asian & Pacific and European markets, US major stock indices have gone down as much as yesterday. DJIA lost about 1,900 points in just two days.

Japanese and Russian markets opened today for the first time in this week because of their bank holiday, and the impact was well priced in for the last Monday when the other markets plummeted. For example,
Nikkei 225 >>  -3.3%.
RTS index >> -5.1%.
Kospi index >> +1.2%.
S&P/ASX 200 >> -1.6%

There is another market being back from the national holidays, Brazilian stock market opening ahead. Tomorrow (Wednesday) is a key for the market opening. While Asian & Pacific markets were relatively mild on Tuesday, US market was devastated again and it could trigger further crash in Asian & Pacific market on Wednesday.(Nikkei 225 future digged 2.4% by last closing.) Then, European markets could follow the negative sentiment as the Covid-19 recently brought anxious mood into Italy and Europe. Unless breakthrough for the corona virus is indicated, the global markets are unlikely to turn optimistic in coming days.

On Thursday when Brazilian stock market finally opens, it is inevitable to face massive loss and it could overshoot like downward spiral as it is the first opening since last week. The scale depends on how the other markets move next 1 or 2 days, but it can go down by 10%.

Japanese and Russian stock markets opening just after the bank holiday 24-Feb-2020

Global stock market plummeted on this Monday as Coronavirus (Covid 19) outbreak severely hit South Korea and Italy over the last weekend. One of the big Asian markets, Japan had a bank holiday this Monday and it is opening in a few hours from this time since the other market dived into the bloodbath. Japan is also facing uncertainty of Coronavirus spreading as increasing number of patients even excluding ones from Diamond Princess. Russia had a bank holiday on this Monday, too.

In the mean time, Japanese index Nikkei 225 futures market has gone down around 4.7%, and the index's opening price is also expected down near by the same level after the fair value adjustment.

Along with the Japanese market, other Asian and Pacific markets are also opening in the near time zone. If the other markets were bouncing back from the last miserable closing, the potential damage on Japanese market could be limited. This Monday, Australia's ASX 200 index has gone down by 2.25% but its future market does not indicate clear relief yet. US market was also bearish, which was the worst in 2 years. Dow Jones Industrial Average has lost more than 1,000 points equivalent to nearly 3.6%.

Sometimes, good news are suddenly coming in, but Asian and Pacific markets could not be optimistic yet, particularly Japanese market.

Here is the list of global stock indexes.

[Asia & Pacific]

(Australia) S&P/ASX 200
(China) SSE Composite Index

(Hong Kong) Hang Seng Index
(India) S&P BSE SENSEX

(Japan) Nikkei 225 Index
(New Zealand) S&P/NZX 50
(S Korea) KOSPI Index

(Singapore) STI Index

[Europe / Middle East]

(France) CAC 40

(Germany) DAX

(Italy) FTSE MIB

(Norway) OSLOStock Exchange All Index

(Russia) RTSI Index

(Saudi Arabia) Tadawul All-Share Index
(Spain) IBEX 35

(Sweden) OMX Stockholm 30
(Switzerland) Swiss Market Index
(UAE) Abu Dhabi Securities Market General Index

(UK) FTSE 100

[Africa]

(Nigeria) Nigerian Stock Exchange All Share Index
(South Africa) FTSE/JSE Africa All Share Index

[North/South America]

(Brazil) IBOVESPA

(Canada) S&P/TSX Composite index

(US) Dow Jones Industrial Average

How hard to reach the trade agreement between UK and EU?

At the end of last January, UK finally relinquished the EU membership in term. British MEPs, including Mr.Farage seen one of the most prominent Brexiter, have left Brussels.

Although it just started the transition period and people's activities are not practically changed until the period, it is likely the end of "Endless" talks between UK and EU about Brexit. Now, British government whose cabinet ministers were shuffled last week has to negotiate the trade deal with European Commission. The end of the transition period is set on the end of 2020 unless it is agreed to extend the period between UK and EU while Mr.Johnson does not want to do.

Even if UK (and EU) expect to reach the agreement, how it is realistic to reach a decent deal in a year?  Due to the tight deadline, both sides tend to prioritize the negotiation issue on top. But the free trade agreements between EU and other large economies took much more time to be finalized, which also requires ratification. Here are some examples.

[EU-Japan Economic Partnership Agreement]
 The negotiation had started since 2013,
 Reached at the agreement on July-2018,
 Ratified on December-2018,
 Has been effective since 1-February-2019.

About 6 years to the enforcement.

[EU-Singapore FTA]
 The negotiation had started since 2010,
 Reached at the agreement on October-2018,
 EU member states endorsed on November-2019,
 Has been effective since 21-November-2019.

About 9 years to the enforcement.

[CETA, EU-Canada Economic and Trade Agreement]
 The negotiation had started since ?,
 The negotiation ended on August-2014,
 The agreement was signed on October-2016,
 Has been effective since 21-September-2017.

More than 3 years + the negotiation period, to the enforcement.

Abolishing the relationship when UK was a member state of EU and building the trade agreement from scratch, one year sounds too short to enforce the agreed deal. It implies No-deal Brexit is inevitable rather than it as the worst option. In case of No-deal Brexit, WTO rules will be basically applied to the trades between EU and UK, which is likely to happen.
The market seemed not pricing in No-deal Brexit, but as soon as UK legally rejects any extensions of the trade talk, the market will pessimistically react.

[Updated on 16-Oct-2020]

UK PM mentioned Britons should get ready for no-deal Brexit today as it is still unclear to reach an agreement so-called Canada-style deal. He would seek an alternative like Australia-style deal.

The Guardian: Boris Johnson tells UK: prepare for a no-deal Brexit

“A lot of progress has been made on such issues as social security and aviation, nuclear cooperation, and son on,” he said, but “for whatever reason, it’s clear from the [EU] summit that after 45 years of [UK] membership they are not willing, unless there’s some fundamental change of approach, to offer this country the same terms as Canada”.

He said that given there were only 10 weeks left until the transition period ended, he had to make a judgment about the likely outcome and to prepare the country.

“I concluded that we should get ready for 1 January with arrangements that are more like Australia’s – based on simple principles of global free trade,” he told reporters in a pooled broadcast statement.

EU and Australia started their trade negotiation in May 2018, and it seems the agreement has not been made by now since the negotiation is kicked off. It looks unrealistic for UK to reach a full agreement with EU by the end of 2020.

Ref.
EU-Japan trade agreement on track to enter into force in February 2019
The EU-Singapore agreements explained
Canada-European Union Comprehensive Economic and Trade Agreement (CETA)
CETA – The European-Canadian Economic and Trade Agreement
Australia - Trade - European Commission

BBC news: Brexit: What is the transition period?

FX Volatility bounce back in 2020?

In 2019, FX traders probably wondered the volatility had diminished in pairs of the major currencies though GBP occasionally got bumpy ride because of the Brexit uncertainty.

[CBOE/CME] EUVIX

The volatility of EURUSD has been approaching to the lowest level at remarkable points. According to "FT: Traders twiddle thumbs as volatility fades in currency markets", EURUSD 1 month implied volatility is around the lowest in last two decades. The volatility marked around the lowest level (below 5.00%) in 2007 and 2014, and it now stays near that level.
In the mean time, central banks show little clue about when they are likely to tighten the monetary policies in a coming months or years. The traders cannot effectively use the monetary policy changes as trading opportunities in such market.
Even though few indications of tightening the monetary policy, the volatility is having less room to decline further, which has already reached the lowest in two decades.
Apart from the monetary policy, we are facing geopolitical events which are expected to significantly affect the financial markets, such as US presidential election, Brexit negotiation between UK and EU27 and US-Iran tension which arose very recently.
Whether it is anticipated or not, the market was quiet in 2019. Now in 2020, we will see if it was Calm before the Storm.

[Added on 21-Nov-2020]

Since EUVIX bottomed out early 2020, it peaked in March as financial markets were fluctuated by fear of spreading Covid-19. EUVIX is down from the peak but stays well over the bottom of early 2020.