
Weeks Review into W/C 11th July 2022

Weeks Review
A busy week sees the release of a series of GDP data for the UK, China and Singapore, which will no doubt take centre stage. At the same time, industrial production data for Japan, Eurozone, India, China and the UK will be eyed for clues as to whether growth rates have slowed. The week will end with retail sales and sentiment data for the US.
The global trend of aggressive monetary policy tightening meanwhile looks set to continue, with Bank of Canada widely expected to deliver a 75 basis point rate hike this week, following two consecutive 50 basis point rises.
The spotlight however likely lays with China, which has seen lockdowns persist into the second quarter, for which GDP data are released. While the latest PMI revealed a return to growth following some recent relaxations of COVID-19 restrictions, demand growth remains weak amid the ongoing zero-COVID policy. Our forecasts currently see China (mainland) contracting in Q2 at an annualised quarterly rate of 0.17%, taking the year-on-year growth rate to 0.8%, the weakest since the pandemic lockdowns of Q1 2020.
The UK will also issue Q2 GDP estimates onOvernight Session More Wednesday, alongside services and industrial output data, which are also likely to show an economy in decline. Although recent PMI data for the UK pointed to business activity growth, the surveys also show the cost of living crisis having hit demand growth, adding to the risk of a further UK economic contraction, and technical recession, in Q3.
A relatively quiet week for the US with only retail sales and sentiment data due onOvernight Session More Friday. That said, retail sales figures will be watched intently to assess whether surging fuel costs have added to price pressures and forced consumers to cut back onOvernight Session More spending, as hinted by the latest PMI data.
Elsewhere, industrial production data for the Eurozone, Japan and India will be closely watched. The former two have seen industrial production contract in recent months which is expected to be the case yet again. Meanwhile, India’s manufacturing sector continues to perform strongly.
11th July Holiday leading into CPI and Retail Sales
The labour market will be in the spotlight next week, with the release of the Labor Department’s June nonfarm payrolls report onOvernight Session More Friday. Other labour market reports, such as the Job Openings and Labor Turnover Survey (JOLTS) and ADP’s National Employment Report, which tracks private-sector payroll growth, will provide additional information about the labour market. OnOvernight Session More Tuesday, international PMI surveys tracking business sentiment in the United Kingdom and the eurozone will be released. The minutes of the FOMC’s most recent policy meeting, held in mid-June, will be available onOvernight Session More Wednesday. It will be a quiet week for corporate earnings before the second-quarter earnings season kicks off in mid-July.
KEY TAKEAWAYS
- Corporate earnings season kicks off next week, with second-quarter earnings expected from some of the largest banks and financial institutions, including JPMorgan Chase, Wells Fargo, Citibank, Morgan Stanley, and BlackRock, among others.
- The latest inflation readings, tracking the month of June, are expected as the Bureau of Labor Statistics (BLS) is set to release CPI and PPI figures onOvernight Session More Wednesday and Thursday, respectively.
- June retail sales data will be released Friday, providing valuable insight onOvernight Session More consumer spending and overall confidence.
- The preliminary July reading of the University of Michigan’s Consumer Sentiment Index will also be released Friday, after the consumer sentiment indicator plunged to a record low in June.
Events Calendar:
Events Calendar:
Monday, July 11
- New York Fed President John Williams gives a speech
Tuesday, July 12
- PepsiCo (PEP) reports earnings
- NFIB Business Optimism Index (July)
- IBD/TIPP Economic Optimism Index (July)
- Consumer Inflation Expectations (June)
Wednesday, July 13
- DeltaDelta hedging seeks to mitigate, or hedge, the directional r... More Air Lines (DAL) reports earnings
- Consumer Price Index (CPI) Inflation Rate (June)
- Fed Beige Book Release
Thursday, July 14
- Taiwan Semiconductor Manufacturing Company (TSM), JPMorgan Chase (JPM), Morgan Stanley (MS), Cintas (CTAS), First Republic Bank (FRC), and ConAgra Brands (CAG) report earnings
- Producer Price Index (PPI) Inflation Rate (June)
- Fed Board of Governors Member Christopher Waller gives a speech
Friday, July 15
- UnitedHealth Group (UNH), Wells Fargo (WFC), BlackRock (BLK), Citigroup (C), U.S. Bancorp (USB), PNC Financial Services (PNC), BNY Mellon (BK), State Street (STT), and First Horizon (FHN) report earnings
- Retail Sales (June)
- Import Prices (June)
- Export Prices (June)
- Industrial Production (June)
- Michigan Consumer Sentiment Index – Preliminary (July)
- Business Inventories (May)
- Retail Inventories (May)
- Atlanta Fed President Raphael Bostic gives a speech
Earnings Season Kicks Off with Bank Earnings
The corporate earnings season kicks off next week, with some of the largest U.S. banks and financial institutions scheduled to report. JPMorgan Chase, Morgan Stanley, and First Republic Bank will report onOvernight Session More Thursday, followed by Wells Fargo, BlackRock, Citigroup, U.S. Bancorp, PNC Bank, BNY Mellon, and State Street onOvernight Session More Friday. Other companies scheduled to report include PepsiCo, DeltaDelta hedging seeks to mitigate, or hedge, the directional r... More Air Lines, TSMC, and UnitedHealth.
Bank earnings are expected to take a hit from the sharp decline in mortgage refinancing applications as rates have soared in recent months. Big banks account for some of the largest mortgage lenders, and some, including JPMorgan Chase and Wells Fargo, have begun laying off workers in response to market losses. Wells Fargo previously reported a 33% year-over-year decline in mortgage revenue for the first quarter, a decline that is expected to accelerate as the bank reports earnings onOvernight Session More Friday.
Weekend Reading:
Is A Global Recession Coming?
Here is Macro Alf who talks about the global economy and the possibility of a recession. He is a top analyst and recommends to all who want to follow the latest economic developments.
Here is his Twitter feed: https://twitter.com/MacroAlf https://themacrocompass.substack.com/p/recession#details
And here is a short video explaining some macro: How housing and durable goods are important leading indicators and something to be closely monitored.
Oil’s Latest Slump: Goodbye Inflation Trade, Hello Recession
- US crude futures fell below $100 for the first time since May
- The market remains vulnerable to big moves amid liquidity crunch
And finally, I am often commenting onOvernight Session More the price of oil, its importance as a primary cost inflator to almost everything in the global economy makes it an important market to monitor every day. We are seeing high correlations between WTI and inflation-sensitive markets. We are at a critical moment regarding pricing onOvernight Session More the one hand Putin/War inflationary pressures and the emerging recession narrative.
Here is an alternative piece looking at the emergence of the recessionary narrative in oil. Please also look at the GFC crisis and see what happened to oil during that period. I won’t spoil it, look for yourself:)
Notable tweets
Weekly Review

NFP Week Debrief
Inside a week, early onOvernight Session More the auction tested the prior week’s low area, the auction failed to break below to leave a non-excess low of 3744. The auction moved higher to test the other side of the previous weekly extreme, leaving an equally non-excess high.
Multiple Distribution Week
H: 3922 L: 3744 VPOCThe POC or Point-of-control is the price where the most amou... More 3905 MID 3830 VWAP 3846 SETTLE: 3906
MONITORING: 3922- High | 3830 MID Area |
Why look at the Weekly and Monthly?
Using the composite
In addition to monitoring the previous day's Market prof... More profiles gives me a lot of clarity in understanding the market. Understanding the story and the basic mechanics of what is going onOvernight Session More simplifies almost every other aspect of my trading, especially timing.
By identifying areas of balance/ acceptance in the auction I have a natural edge. I can identify value and the pivots of change. In balance I look to fade the extremes, when activity leaves an area of acceptance, I monitor for strength and conviction of the move. For this, I use volume and value as a guide. As a general rule, if a move is genuine, volume and value will move in away from prior acceptance to a new area.
Monthly Profiles

Something that was noted in the weekly and daily profiles was the lack of time being spent auctioning between the HVNHigh volume node, or peak. An area that has been well traded... More > looking at these onOvernight Session More the monthly it’s clear to see the magnetic attraction to the HVNHigh volume node, or peak. An area that has been well traded... More areas. Inside the HVNHigh volume node, or peak. An area that has been well traded... More expect Choppy Price actionPrice action More.
Monthly Multi Distribution,
H 4922 L 3744 VPOCThe POC or Point-of-control is the price where the most amou... More 3905/3774
All images can be found on my Twitter feed in high resolution. Please let me know if you have issues much appreciated.

UPDATE: