GBP against AUD, CAD and NZD in a few coming days. Follow the Brexit issues.

Once we have continuously picked up Trend and Momentum analysis from the list of FX. (You will find all of them on our website or Android app)
Those were just the examples which are expected to help users to understand how to see the Trend and Momentum indicators. Since our last update was long while ago, it seems be harder to find our articles in old days. It's probably reasonable to update some examples in the latest market now.

According to the update on the beginning of 22-Feb (UTC), the analysis result had indicated downward trend in GBPAUD, GBPCAD and GBPNZD. Those have downed by approx 0.40%, 0.60% and 0.55% respectively. While the momentary backlash would be likely, the Trend and Momentum still shows further room to downward.

[GBPAUD Trend and Momentum on 22-Feb-2019 UTC]

Last closed at 1.831.
Analyzed bottom by 1.80 (-1.69%).







[GBPCAD Trend and Momentum on 22-Feb-2019 UTC]

Last closed at 1.714.
Analyzed bottom by 1.70 (-0.82%).







[GBPNZD Trend and Momentum on 22-Feb-2019 UTC]

Last closed at 1.90.
Analyzed bottom by 1.88 (-1.05%).







It's just a reminder that GBP would be sensitive to Brexit issues including some speculations. A new Brexit deal is expected to be reached by 26-Feb next week. Otherwise, Theresa May would return to House of Common for further discussion with MPs.

[BBC] Brexit: What happens now?
If the EU were to agree to changes and MPs backed the adjusted deal, that would be a great result for Theresa May.

But senior EU politicians have said they will not reopen the legal text of the withdrawal agreement that they negotiated with the UK.

If MPs aren't satisfied with any adjusted deal put before them they could reject it again. Theresa May has also promised that even if she can't get the changes she's after, she would return to the House of Commons yet again on 27 February and allow MPs a further day of debate.


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Energy Transition long way to be real

Energy Transition whose concept includes the matters of energy technology or fuel sources, is naturally posed with "Climate Change". Fossil fuels are typically targeted in such discussion because of Carbon dioxide (CO2) being produced and pollution, too.
While the Energy transition is an idealistic concept, the reality seems be that people on this planet continue reliant on fossil fuel including oil as much as now. According to the report OIL 2018, it indicates that world oil demand increases by more than 5.5% until 2023. World Oil Outlook of Opec in 2017 has also indicated that Eurasia primary energy demand of oil, coal and gas increase 0.6%, 0.5% and 0.7% per year respectively by 2040. Nuclear energy demand is expected to outpace those energy sources, but it is behind higher risk at accidents, which was reminded from Fukushima disaster in 2011.

Big players in the market, are ironically investing into the oil production infrastructures these days, according to the below sources. Perhaps, it is too early to restructure your portfolio, adapting to Energy transition, unless your investment horizon is beyond next 50 years?

[Bloomberg] KKR, BlackRock Are Set to Invest $4 Billion in Adnoc Pipeline
KKR & Co. and BlackRock Inc. are set to invest in Abu Dhabi National Oil Co.’s pipeline network in a deal valued at $4 billion to $4.5 billion, according to people familiar with knowledge of the matter.

[The Economist] ExxonMobil gambles on growth
A fossil-fuel titan’s strategy is at odds with efforts to hold back climate change
.....
On February 1st the company announced annual results, declaring itself on track for ambitious growth. By 2025, oil and gas production will be 25% higher than in 2017.

"Asian Forex traders attracted to Bitcoin because of its higher volatility" sounds nonsense only to me?

Some articles have said Asian Forex traders, so called Mr/Mrs.Watanabe symbolically, have been shifting from fiat FX trading to crypto FX trading, betting on BTCUSD, ETHJPY, LTCEUR ...  It is also said that those traders are attracted to higher volatility compared to the lower volatility in fiat FX market. It would be a true fact that crypto's volatility is higher than fiat's one. The volatility of BTCUSD could be about 10 times more than the volatility of GBPUSD for last 6 months.

Well, if you are more experienced traders, you would agree that the volatility is not (only) a reason to choose underlying assets. Before making conclusion which of fiat FX or crypto FX are more reasonable underlyings, let's take a look some fundamental data. Here is a comparison between BTCUSD and GBPUSD in Bid/Ask quotes and the spread, observed at one of regulated brokers today.

Quotes: BTCUSD and GBPUSD

It tells that the spread/quote is about 65 times in BTCUSD against GBPUSD. In case of investing USD 10,000 for each BTCUSD and GBPUSD respectively, the immediate cost for BTCUSD is about USD 98 while one for GBPUSD is about USD 1.5.
Some Watanabes would claim that they expect higher volatility driving their profit and absorbing the cost. So let's take another measure of the expected profit in case of one-sigma moved to a favour direction. Using daily volatility for last 6 months, it is estimated below.

P/L by one-sigma up

Oops, BTCUSD performs more than GBPUSD even after the expensive cost. (Gap = USD 365)
It is the fact, but does it mean we should invest in crypto FX rather than fiat FX?

The brokers usually allows investors to leverage, so see how much investment will bring same return in fiat FX as crypto FX. It is not a big deal. In this case, if you leverage only about 8.7 times on the fiat position, you will get same returns by one-sigma up.

Leveraged on the fiat position

Brokers offers more leverage on fiat FX while far small leverage is allowed on crypto FX, so you could only put your money USD 10,000 at the account.

Ok, but some might argue that BTCUSD performs same as GBPUSD but does not need such leverage. We took the case for upside this time, but how about the downside risk?
Under the same condition, but in case of one-sigma down, the P/L is estimated below:

P/L by one-sigma down, leveraged on the fiat position

You lose USD 147 more from BTCUSD position while both BTCUSD and GBPUSD have same returns from one-sigma up. This is naturally because the Bid/Ask spread is wider in BTCUSD.

Relatively lower volatility at fiat FX can be compensated by just 8.7 times leverage. The downside risk is smaller in fiat FX than crypto FX, to expect same upside. If you do not have very specific preference, it seems be more reasonable to trade fiat FX rather than crypto FX, doesn't it?

I have no intention to stop Mr/Mrs.Watanabes trading crypto FX, but probably worth to rethink about it.

Banking job cuts announced in a last few years

After the financial crisis in 2008, many of large banks had introduced job cuts though some might have hired back as the market recovered. Investment banking division supposed to be in a main focus of the layoffs that time.

In a last few years, 2016 - 2017 particularly, job cuts have been introduced from retail sector to investment banking. Some European banks plan to cut thousands jobs, including German, Italian and Dutch banks. Japanese banks, which are usually unwilling to cut jobs, plan to cut multi thousands of jobs in next 10 years, and AI is likely to play a part of roles used to be operated by bank staffs. CEO at UBS also hinted 30,000 workers could be shed in the years ahead due to the technological advances.
Some of you who has been looking for banking jobs in recent years could feel how banking job offers have disappeared from the job boards.

Actually, some bankers tell that many staffs in Front Office to Back Office play on the middle of business flows, scrolling, typing and clicking on business softwares. It sounds that these jobs could be replaced by more advanced softwares which directly connect from business front to the end. One software could shed dozen of jobs in each department. Complex risk calculation is just a pile of mathematical formulae, but it would not be difficult to write in source codes.

Here are some stories about the banking job cuts, published since 2016.

Nordea Bank’s 6,000 Job Cuts Are Just the Beginning, Union Says
Nordea has just said it intends to get rid of 4,000 full-time employees and 2,000 consultants. Those announcements will be made internally and department by department at regular intervals over the coming years, the bank has said.

Commerzbank to cut 7,800 jobs in Germany: Handelsblatt
Commerzbank said last September it planned to cut 9,600 jobs, more than a fifth of its workforce, but trade union Verdi has said the total would actually end up being lower due to already agreed cuts and the usual process of staff attrition.

Deutsche Bank's CEO Hints at Thousands of Job Cuts
Cryan has warned repeatedly that technology will allow big savings across his sprawling empire, and recent media reports suggest he’s under increasing pressure from shareholders to deliver, having also suspended the bank’s regular dividend. Only 4,000 of the 9,000 job cuts promised under a five-year restructuring plan–announced in late 2015–have so far taken place.

ABN Amro Slashes 60% of Senior Management After Staff Cuts
ABN Amro, which is 70 percent owned by the Dutch government following a state rescue, said in November it would cut 1,500 jobs as it steps up cost reductions. The bank, which employed 26,500 people last year, said its total workforce is expected to decline by 13 percent by 2020. The Dutch government has said it plans to gradually exit its holding in the bank.

ING announces 7,000 job cuts as unions condemn 'horror show'
ING’s plans to shed 7,000 jobs and invest in its digital platforms to make annual savings of €900m by 2021 has drawn swift criticism of the Netherlands’ largest financial services company from unions.
The layoffs represent slightly less than 12% of ING’s 52,000 workforce, because nearly 1,000 are expected to come at suppliers rather than at the bank itself.

Barclays axes 13,600 jobs in 9 months
Staley said at a conference in March that more than 6,000 positions had gone in his first 100 days in charge, marking a sharp acceleration in job reductions in the past four years, and his latest estimate shows the pace of cuts has continued.
Staley, who started in December, cut 1,200 jobs in the investment bank in January as he pulled back from Russia, Brazil and seven countries in Asia.

BNP Paribas to cut 5 percent of investment banking jobs in UK - source
BNP plans to axe 233 British jobs but will also be hiring 60 employees there -- bringing the net headcount down to 3,105 in 2016 from 3,278 in 2015, the source said without giving details on where the job cuts would come from.
A similar net number, 179 in all, will be hired in lower-cost Poland, increasing its staff there by about half to 507 employees.

SocGen to Deepen French Job Cuts, Takes $678 Million Charge
As many as 900 reductions may take place as the domestic retail banking business cuts branch numbers, resulting in a charge of about 400 million euros, SocGen said in a statement. That’s on the top of the 2,550 positions the bank has already said it will eliminate. SocGen will book another exceptional expense related to three tax changes.

Banco Santander to reduce number of job cuts in Popular integration, union says
Banco Santander has reached an agreement with unions to reduce the number of staff affected by planned job cuts relating to the integration of Banco Popular by around 900, a union said on Tuesday.
Santander was originally planning more than 2,000 job cuts, of which 575 the bank was looking to accommodate within its other businesses, the Comisiones Obreras union said in early November.

More IT job cuts at HSBC
After laying off 120 IT staff in March, HSBC reportedly hit the same department with another round of job cuts yesterday. According to Apple Daily the bank has made a number of IT employees redundant.
The Hong Kong Banking Employees Association confirmed yesterday’s IT job cuts which affected around 10 employees. Although the scale of the cut is relatively small, the association condemned it and added it believes there will be more job cuts to come at the bank in the future.

No end in sight for Deutsche Boerse hiring freeze
The Frankfurt stock exchange suspended hiring at the end of February after revenues for the first two months of the year proved weak, but a person close to the process said there was still "no date for an end yet".

Credit Suisse to cut further 1,500 jobs in cost-cutting drive, sources say
Credit Suisse is to axe 1,500 jobs in London by the end of the year as the Swiss bank continues its ruthless cost-cutting drive, it is understood.
Some 2,500 London staff cuts took place last year as part of a major restructuring introduced by chief executive Tidjane Thiam in a bid to shave costs to less than 17 billion Swiss francs (£13.6 billion).
This brought the number of Credit Suisse employees in the City from over 9,000 in November 2015 to 6,500 by the end of last year.

National Australia Bank to Cut 4,000 Jobs in Automation Push
National Australia Bank Ltd. announced plans to eliminate 4,000 jobs, or about 12 percent of its workforce, joining the ranks of global lenders cutting costs and shedding staff in the face of advancing technology. 
“As we simplify, we automate processes and things move to digital channels, we will need less people,” National Australia Chief Executive Officer Andrew Thorburn told reporters in Sydney on Thursday. “The reshaping of the workforce is going to be significant.”

RBS to axe 680 jobs as it closes 259 branches
The bailed-out lender said 62 Royal Bank of Scotland and 197 NatWest branches would shut as customers increasingly turned to online banking.
The Unite union said 1,000 roles faced the axe, although the bank – which is 71% owned by the taxpayer – said the move would result in 680 redundancies after redeployment.

Royal Bank of Canada to Cut About 450 Jobs in Toronto Area
Canadian banks have announced more than 5,000 job cuts tied to restructurings during the past three years, though the number is probably higher since many announcements, including those by Toronto-Dominion Bank and Canadian Imperial Bank of Commerce, didn’t disclose job figures. The country’s six largest lenders collectively employed about 363,600 workers as of the end of April, including 75,281 at Royal Bank, according to company disclosures.

Two decades after Japan’s financial crisis
In recent months, the megabank groups have announced plans to cut thousands of jobs and close outlets over the next several years. Mizuho Financial Group says it plans to reduce its employees including part-time staff, who numbered 79,000 at the end of last March, by roughly 19,000 by the end of fiscal 2026, and cut the number of the group banks’ outlets nationwide by about 100 to some 400 by the end of March 2025. Similarly, Mitsubishi UFJ Financial Group will cut its 40,000-plus workforce by 6,000 by the end of the 2023 business year. Combined with Sumitomo Mitsui Financial Group, which earlier said its would slash the workload equivalent of 4,000 jobs by the end of fiscal 2019, the total number of jobs cut could add up to some 30,000 among the major banking groups.

Technology could help UBS cut workforce by 30 percent: CEO in magazine
Swiss bank UBS (UBSG.S) could shed almost 30,000 workers in the years ahead due to technological advances in the banking industry, Chief Executive Sergio Ermotti said in a magazine interview.

[Short term] EUR being adjusted into downward further?

Since the tension escalated between US and North Korea, President Donald Trump warning "fire and fury", the financial market has been shaken and it driven investors into risk off.

Swiss Franc and Japanese Yen lifted in large scale, where EURJPY is around 128.56 which is near the lowest level in a month.

While EURJPY was down to a month low, EUR had hiked for some months against other major currencies.
Our Trend and Momentum indicates there are still rooms where EUR is adjusted into downward for such EURCAD, EURGBP and EURNZD.

You can check more Trend and Momentum indicators on our free mobile app available on Google Play.

A new app Techsensus

Techsensus has been released and now available on Google Play. The latest stories about hot topics such as Bitcoin, Ethereum, Altcoins, Blockchain, Fintech, Virtual Reality, Augmented Reality, Artificial Intelligence, are listed on the app.
It allows to check different topics from different media on a single platform, listed by media consensus.

Back to 2008 - early 2010s, Smart phones and iPhone were clearly the following hot markets, and now it is not only Bitcoin but also VR/AR, AI are emerging.

You can download from Google Play for free.

(Techsensus [World Tech news])

European elections 2017

There are more political uncertainties in Europe this year, as you would be already aware of. Here are probably not all of them, but some remarkable events listed below:

15-March: Dutch general election
Netherlands picks up members of House of Representatives. Main focus would be how many seats are being held by Geert Wilders' Party for Freedom (PVV). Recent reports still say PVV is leading the poll, which currently have 12 seats out of 150 and is expected to obtain around 30 seats.
>> General election: Latest poll of polls shows slight drop in PVV support
>> Dutch polls

23-April and 7-May: French presidential election
Two rounds are held to for the election. Currently, the poll by Elabe for Les Echo predict that Emmanuel Macron wins by beating Marine Le Pen on the second round. Francois Fillon is facing Fake job scandal. Although the investigation is underway, it inevitably damage his supports for a while.
Global interests would be whether Ms.Le Pen beats another on the second round, who is leading National Front party known as a far right wing and EU sceptic party.
But now, the president is still Francois Hollande.
>> François Fillon faces 'elimination' from French presidential race as 'fake jobs' scandal intensifies

11-Sep: Norwegian parliamentary election
Since no radical party rise up in Norway which is not a member of EU, majority of global media have not followed the election. As seen in the poll, it indicates Labour Party (AP) which currently holds the largest number of seats would get advanced further. But the poll outcomes with no particular surprise.
>> NORWAY, January 2017. Sentio poll
>> New political alliances forming

24-Sep: German federal election
Some know Alternative für Deutschland (AfD) have got spot lights in 2016, as a consequence of the refugee crisis. However, the recent poll shows Ms.Merkel's CDU/CSU (Christian Democratic Union/Christian Social Union) coalition is still leading, followed by Social Democratic Party (SPD).
Although there are 7 months to go, German political order is unlikely to change too drastically.
>> Merkel’s Challenger Leads Social Democrats to German Poll Boost
>> POLLYTIX GERMAN ELECTION POLLING TREND

Some day in 2017?: Italian parliamentary election
The next parliamentary election is planed in 2018. But, after the referendum on December, Matteo Renzi resigned PM position, and both Democratic party and 5-Star movement are calling for the earlier election. 5-Star movement possibly takes majority of seats for the next election, which is known as anti-establishment and Eurosceptic.
>> Italy court verdict could pave way for early elections


There were many political events which probably shake the financial markets in 2017. But I would more concern that European economy will visibly stagnate this year. Maybe, it is better to publish on another post.