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Speaker 1: This is Bloomberg Surveillance and not reliant on the FED

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Speaker 1: to company to generate earning. I think that they should

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Speaker 1: be thinking about moving in June. I don't think they will,

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Speaker 1: but I think they're going to get a bit further

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Speaker 1: behind every meeting that you have to pass. The FED

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Speaker 1: is not just able to manage monetary policy with respect

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Speaker 1: Bloomberg Radio. He means is no words sell oil. In

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Speaker 1: this hour we look at oil Palsana joints from Bank

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Speaker 1: of America. Mary Lynch will get to that and then

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Speaker 1: a good morning everyone, Bloomberg Surveillance. Michael McKee and Tom Keene,

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Speaker 1: welcoming all of your worldwide Bloomberg twelve hundred Boston or Tease.

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Speaker 1: What a weekend Bloomberg twelve hundred Boston FM, Washington, Baltimore,

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Speaker 1: Bay Area. Just waking up in San Francisco, A beautiful

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Speaker 1: day in New York, Chili Sunday, but there it is,

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Speaker 1: Yes and somebody sees it, send it home. David Blanche Flower.

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Speaker 1: We say good morning, hanover New Hampshire. It is snowing

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Speaker 1: this morning, is blanch shower. He walks his dog, Maynard

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Speaker 1: Keynes is the name of his dog, Maynard Keynes um

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Speaker 1: actually in the cat, the Siamese cat. He has his

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Speaker 1: named Austerity. It's good morning, Professor Blanche Flower, if you're listening,

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Speaker 1: and of course all of your nationwide seriously next time

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Speaker 1: Channel one nineteen Bloomberg Surveillance brought you by Cone Resident

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Speaker 1: Accounting Tax Advisory to keep your business on top of

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Speaker 1: industry experts like Cone Resnick. Find out more at Cone

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Speaker 1: Resnick dot com. This is a real joy. His book

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Speaker 1: is New Frontiers and Technical Analysis. It's all forty two copies,

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Speaker 1: all of them to his family. I'm kidding is a

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Speaker 1: great book by Paul Siana, who guided in lead the

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Speaker 1: Greek of technical analysis within the Bloomberg world for years.

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Speaker 1: And he has joined Bank of America, Mary Lynch, which

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Speaker 1: is a good and beautiful thing to join. Nathan Harris

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Speaker 1: and Francisco Blanche Paul, good morning. Your call is for

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Speaker 1: oil self. Does the good Francisco Blanche agree with you?

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Speaker 1: Or is this where the technical guys fighting with the

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Speaker 1: fundamental guy. Good morning, Tom, and thank you for having me.

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Speaker 1: The good news, indeed, is that the fundamentals and technicals

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Speaker 1: appear to have a line in this instance. Well, they've

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Speaker 1: a line in the instance. But are we talking? I mean,

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Speaker 1: let's make this clear here. You're talking about a modest

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Speaker 1: what fifteen dollar move? You're not talking about back to

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Speaker 1: twenty nine and barrel right? No, absolutely not. The lows

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Speaker 1: and crude oil are most certainly in and this particular

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Speaker 1: trade ideas actually counter trend. We believe the trend and

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Speaker 1: crude a processes and fact leaning higher. However, at the

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Speaker 1: given time, we do see many reasons from the technical perspective,

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Speaker 1: especially for a pullback to occur. I know Mike wants

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Speaker 1: to go in here, but we've got to prove your

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Speaker 1: technical chops. Even though you wrote a new frontiers and

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Speaker 1: technical analysis basic idea of of of what you do

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Speaker 1: and what not to do, one of your big knots

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Speaker 1: is the Golden Cross. You and I know, Paul, you've

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Speaker 1: got your first gray hair arguing with media types over

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Speaker 1: the death Cross. The golden cross. You don't put much

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Speaker 1: faith in the five and two day moving average? Do

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Speaker 1: you much at all? To cross? Um by nature is

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Speaker 1: a lagging signal? Uh. There are some markets where statistics

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Speaker 1: show that there is some validity to it. However, there

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Speaker 1: are many others. Whether it's just really isn't much at

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Speaker 1: all and crude only here is one of them. One

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Speaker 1: of the comments we made in our recent report show

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Speaker 1: that although the fifty day moving average was about the

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Speaker 1: cross above the two on your day, and in fact

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Speaker 1: since right in that report it has there is a

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Speaker 1: little statistical validity to it. I believe we quoted about

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Speaker 1: twenty three crosses since front Montcruro contracts have been trading,

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Speaker 1: and only nine of those were profitable if in fact

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Speaker 1: you exited when the fifty day crossed back below the

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Speaker 1: two days. So I'm not a fan of going with

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Speaker 1: the bias of nine working and the remaining of the

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Speaker 1: twenty three not working. That's called evidence. That's what chart

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Speaker 1: people say. Paul. Paul was the king of go to

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Speaker 1: the Bloomberg and what's the evidence? State the facts? Technical analysis, Well,

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Speaker 1: everything is related, certainly in the in the technical world.

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Speaker 1: The Ruble UH sixty four point five this morning is stronger.

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Speaker 1: It's been strengthening if oil goes down, though you suggest

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Speaker 1: holding onto rubles, are buying rubles is a bad thing. Um,

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Speaker 1: you've got some calls on currencies that are related to oil. Yes, absolutely, Uh.

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Speaker 1: The decline in crude prices has created a massive correlations

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Speaker 1: and currency markets. Uh. The one that I think we

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Speaker 1: lean towards them like most is uh of creudros to

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Speaker 1: continue or just really start at the client here. Uh,

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Speaker 1: the Canadian dollar actually may be most affected the dollar.

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Speaker 1: The Canadian dollar reached a LEW sixty one and began

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Speaker 1: to rise just a little bit there and challenge one thirty.

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Speaker 1: We think that crude rose over here, that the Canadian

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Speaker 1: dollar could easily see about one thirty five and possibly

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Speaker 1: interr day or inter week upwards of eight. So uh,

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Speaker 1: what do you buy right now? Then? Well, as you

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Speaker 1: relate crude oil markets to the currency markets, uh, it's

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Speaker 1: more of an inverse picture, right. Uh. There isn't much

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Speaker 1: out there that goes up with crude prices going down.

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Speaker 1: But while the Canadian dollar would weakend, Uh, you have

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Speaker 1: to which currency you want to compare that again? So uh,

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Speaker 1: if the Canadian dollars going to weekend. In that case,

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Speaker 1: it's a place to still be long dollar. And despite

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Speaker 1: what happened to the dollar over the course of the

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Speaker 1: last six weeks, gold is sport. Gold is sport. We

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Speaker 1: can talk about this in our next book right now

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Speaker 1: over at HSBC. James Steele, using very fundamental analysis and

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Speaker 1: demand in China and Asia, put a bit under gold

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Speaker 1: ages ago as you did, but reaffirm that right now.

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Speaker 1: Gold has been squishy recently. What does policy how to

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Speaker 1: do with a squishy chart on gold prices? You buy

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Speaker 1: the deep. We're bullish gold prices. We we initiated our

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Speaker 1: first long and goal at about ten eight nine earlier

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Speaker 1: this year. We actually took that trade off about twelve

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Speaker 1: fifty eight in March, anticipating a consolidation and an opportunity

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Speaker 1: to go long once again. Okay, but that's the point

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Speaker 1: that's beautifully explained, beautifully beautifully explained. So you're long, you're

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Speaker 1: a winner, you get out, How do you determine when

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Speaker 1: to get back in again? When prices reached an important

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Speaker 1: confluence point, and one of our important confluence points for

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Speaker 1: a pullback is the approximate area where it actually broke

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Speaker 1: out of the multi year downwards solping channel and additional

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Speaker 1: resistance levels at about twelve ten. So a nice gold

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Speaker 1: pull back to the low twelve hundreds is a high reward,

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Speaker 1: low risk area to buy gold once again and anticipation

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Speaker 1: of the full projections from the technical bottom of thirteen

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Speaker 1: fifteen and thirteen seventy five being reached. Is that precise

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Speaker 1: enough for you, Mike, Yes, exactly. He used to go

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Speaker 1: to sense, he goes, he go thirteen ten and forty

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Speaker 1: two cents, But now that he's out in the real world,

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Speaker 1: he doesn't do that anymore. What about the other precious medals?

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Speaker 1: What about silver? Uh, it's correlated, then it's not correlated

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Speaker 1: with gold, and it's correlated again. Where do you see

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Speaker 1: silver and uh? And at the same time, same platinum. Sure,

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Speaker 1: silver indeed has been a lagger. However it's been shining lately.

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Speaker 1: There is a massive resistance level that is also a

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Speaker 1: target of about eighteen sixty. We think silver can get there.

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Speaker 1: Uh is on a uh you know, volume driven, open

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Speaker 1: interest driven, momentum driven breakout. So with that said, um

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Speaker 1: silver has moved a lot in a very quick amount

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Speaker 1: of time. Again, buying a pullback to find a favoral

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Speaker 1: psisition to create that risk reward that's ideal for investing

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Speaker 1: in trading. UH is the position here. We do see

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Speaker 1: silver prices reaching eighteen sixty this year. UH. Just the

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Speaker 1: question of when do you buy to get into UH

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Speaker 1: take take those profits is a broad statement. We'll come

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Speaker 1: back for another section with you. Are you a believer

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Speaker 1: in get on the trend, stay on the trend until

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Speaker 1: proven otherwise or do you look at more momentum and

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Speaker 1: stochastic indicators? Which which way do you tell? The best

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Speaker 1: trades that let you sleep at night are those that

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Speaker 1: are going with the trend without a doubt. However, there

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Speaker 1: are times in the markets where positioning gets too heavy

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Speaker 1: and signals of counter trend nature suggests that there's going

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Speaker 1: to be a pull back. Yeah, this position is positioning

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Speaker 1: too heavy right now. In consumer blue chips, I would

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Speaker 1: say positioning is too heavy and gold and silver actually

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Speaker 1: those two markets in particular art risk for a pullback

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Speaker 1: given the extreme stretch and positioning brilliant, let's come let's

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Speaker 1: come back. Paulsiano was Bank of America Maryland's their chief

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Speaker 1: thick technical strategists working in fixed income commodities and currencies

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Speaker 1: is well, Mike, you see that precision that that that's

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Speaker 1: that's not rare in technical analysis, but it's something that

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Speaker 1: the pros do where they banned things and they get things.

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Speaker 1: And the most important thing Paul said there was the

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Speaker 1: probability that it's not go along gold, you idiot, You've

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Speaker 1: got to be on gold. But that the probability at

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Speaker 1: a certain point is comfortable versus the humility of actually

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Speaker 1: being wrong. Not that that's ever occurred. When we come

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Speaker 1: back about position in oil, because yeah, that's good. We

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Speaker 1: we we've we saw today a sort of fight between

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Speaker 1: the Golden folks and Phil Verlier about what's going to

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Speaker 1: happen with golden next Well, it's one of the golden

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Speaker 1: particularly in oil as well. You're Mr Siana talk about

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Speaker 1: those currencies as well. Looney one nine sixteen weaker Looney

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Speaker 1: this morning. Now it's time to check in with Michael

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Speaker 1: Barr and get the latest world in national headlines. Michael, Mike, Tom,

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Speaker 1: thank you very much. Donald Trump says it is unlike

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Speaker 1: he'd have a very good relationship with British from Minister

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Speaker 1: David Cameron last year, Cameron called Trump's proposal to band

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Speaker 1: Muslims from entering the US divisive, stupid and wrong. Trump

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Speaker 1: on i t v s Good Morning Britain also called

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Speaker 1: comments from London's new mayor's Aty Khan rude and nasty.

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Speaker 1: Cohn described Trump's view of Islam as ignorant. Islamic state

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Speaker 1: attacks across Iraq had left at least twenty nine people dead.

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Speaker 1: One attack was launched on a natural gas plant north

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Speaker 1: of Baghdad. Democrats on the panel are attacking the Republican

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Speaker 1: chairman of the House ben Ghazi Committee. They're accusing South

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Speaker 1: Carolina Representative Trey Gaunty of ignoring statements by his own

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Speaker 1: former lawyer indicating at the U. S Military acted properly

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Speaker 1: on the night of the deadly twelve attacks in Libya.

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Speaker 1: Global News twenty four hours a day on Michael bar

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Speaker 1: Tom Mica Bar thanks so much. We're with Paul Siana

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Speaker 1: on the charts. Looking forward to that. He's the Bank

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Speaker 1: of America, Marylynch, Michael McKee, and Tom Keene this mon day.

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Speaker 1: Stay with us. This is Bloomberg Surveillance. The news update

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Speaker 1: Radio plus Mobile Act and on your radio, this is

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Speaker 1: a Bloomberg Business Flash and I'm Cameron Moscow. U S

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Speaker 1: stock index futures are rising along with the price of oil.

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Speaker 1: Let's go to the first Word breaking news desk for

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Speaker 1: today's morning call. Here's Bill Maloney. Good morning, Bill, Good

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Speaker 1: morning Karen. That's right. US futures have turned positive since

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Speaker 1: the last time we spoke on this busy day for

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Speaker 1: deal news. Doubtf. Youre just currently hired by ten points,

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Speaker 1: espies gain two and as a futures rise by eleven

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Speaker 1: US teniel at one point seven to and crew futures

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Speaker 1: rides to the highest level since November. On the US

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Speaker 1: Economic frontday thirty Empire State Manufacturing at at ten o'clock

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Speaker 1: an HB housing market. Yeah. In that deal news, Terex

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Speaker 1: to sell a unit to Cone Cranes for one point

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Speaker 1: three billion, Range Resources to buy Moral Resource in a

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Speaker 1: four point four billion dollar deal. Buffets sit a backing

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Speaker 1: group bidding for Yahoo Internet assets, and Fiser to buy

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Speaker 1: Antacor for five a share or five point to billion.

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Speaker 1: Another news Berkshire Hathaway disclose the stake of nine point

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Speaker 1: eight one million shares in Apple. Found these semer Wall

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Speaker 1: Street upgrades and downgrades. Freeport price target raised to a

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Speaker 1: street high fifteen from ten at cowen Ham and Etics

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Speaker 1: raised neutral like Coleman Sachs, J C. Penny raised to

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Speaker 1: Apple form at Robert Baird and finally at bb and

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Speaker 1: T or bb and T raised to buy over at

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Speaker 1: sun Trust. Live from the First Breaking News Desk on

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Speaker 1: Bill Maloney, Karen thanks Bill to hear live breaking news

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Speaker 1: over your Bloomberg type squawk and go on your terminal.

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Speaker 1: That's squ you a w U K go and that's

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Speaker 1: a Bloomberg business flash, Tom and Mike Karne thinks so

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Speaker 1: much Bloomberg surveillance brunched by Investco. Have you considered all

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Speaker 1: investco dot com, slash alternatives, Pulciana with us A Bank

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Speaker 1: of American Mary Lynch looking at technical analysis. He's got

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Speaker 1: a double appendix a gravestone dog. It's a footnote rather

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Speaker 1: a gravestone dog. Forms when the price opens and closes

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Speaker 1: near the low of the session. This goes back to

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Speaker 1: the eighteenth century Paulsiana was there is Munisia Homa invented

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Speaker 1: candlestick charts. I call him candlepin charts for Boston, Pulciana.

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Speaker 1: What is it gravestone dog? And where do you see

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Speaker 1: that in the markets right now? Short thim So, I

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Speaker 1: think that what your question is also about the approach

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Speaker 1: to technical analysis, and one of the aspects of our

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Speaker 1: analysis here on recommending to sell crude oil is analyzing

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Speaker 1: candle patterns within those charts, and where our process believes

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Speaker 1: the best technical strategy is a diversified technical approach. One

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Speaker 1: of those approaches we use to diversify our strategy is

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Speaker 1: understanding what the candle patterns are saying. And what we

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Speaker 1: noticed in the charts ending April and into the first

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Speaker 1: week of May is crude oil prices actually formed four

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Speaker 1: DOGI candles in just six trading sessions. Loosely, one of

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Speaker 1: those candle patterns can be considered a gravestone dog. And now,

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Speaker 1: while some technicians may be open to debating that one

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Speaker 1: a bit harder with me, the general concept of that

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Speaker 1: pattern is when Marcus open at the low, trade up

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Speaker 1: very high on the day, and then sell off the

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Speaker 1: close back near the low. You essentially form a candle

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Speaker 1: pattern that shows buyers bid up prices early in the session,

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Speaker 1: but then sellers came in stronger than the buyers that

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Speaker 1: were there that day and brought it all the way

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Speaker 1: back down to where the day started. Now, they called

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Speaker 1: that a gravestone dog because the actual formation of it

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Speaker 1: kind of looks like a gravestone, right, And as they say,

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Speaker 1: gravestones six ft under never a good sign, never a

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Speaker 1: good place to be. Michael put this chart out on

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Speaker 1: bloom on Bloomberg Radio Plus March eighth. March seventh, rather

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Speaker 1: March seventh, looks very grave stony. Okay, I'm looking at

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Speaker 1: the SNP art and reading some folks technical analysis. They

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Speaker 1: say they see a head and shoulders pattern forming, and uh,

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Speaker 1: we are maybe topping out on the SNP and a

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Speaker 1: sell off is on its way. We haven't talked about equities.

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Speaker 1: I know that you're on the fixed income side, but

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Speaker 1: um as the equity markets maybe top, what does it

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Speaker 1: does that show up in your charts and influence what

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Speaker 1: you're seeing. Indeed, I worked very closely with my counterpart

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Speaker 1: and equity named Stephen sutt Meier, the chief Equity Technical

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Speaker 1: Strategies for Bank of America Maryland Colbal Research, and just

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Speaker 1: this morning he published a piece discussing some of the

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Speaker 1: signals and equity markets and that particular head and shoulders

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Speaker 1: pattern that was looked at, I believe on the two

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Speaker 1: forty minute interdate chart where the next line at about

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Speaker 1: forty is starting to give way UH and UH a

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Speaker 1: projection lower based on that head and shoulders top does

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Speaker 1: bring the SMP five back down to about the level.

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Speaker 1: So where do we UH? If you summed up what

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Speaker 1: we're likely to see going forward, it seems like UM

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Speaker 1: risk off on a technical basis, with crude oil potentially

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Speaker 1: rolling over the SMP forming that top. Those two markets

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Speaker 1: remain high, highly correlated and yes, together would be indicative

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Speaker 1: of the pencil risk of environment. Yes, Paul, how does

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Speaker 1: volume play? And I've never used volume much as UH

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Speaker 1: an advantage to not losing money? Where does volume play

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Speaker 1: into the policy on the world? Sure volume and open

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Speaker 1: interest play in as an important piece, especially in futures markets,

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Speaker 1: and we use that in our crude oil discussion where

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Speaker 1: we saw aggregate volume and aggregate open interest diverging, And

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Speaker 1: what I mean by aggregate is everybody tends to look

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Speaker 1: at the front month crude oil contract and where that's

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Speaker 1: trading at the given moment. However, there are complexities and

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Speaker 1: futures markets to deal with, like rolling from one contract

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Speaker 1: to another and figuring out which one really is the

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Speaker 1: current price and which one is the act of contracts.

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Speaker 1: It's confusing. But if you just kind of add it

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Speaker 1: all together and look across all the crude oil contracts

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Speaker 1: and how much volume traded across the entire chain of

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Speaker 1: contracts that are available every day, you get a more

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Speaker 1: realistic UH number two to be aware of, as well

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Speaker 1: as a more realistic line of data to analyze it.

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Speaker 1: What we've found is the aggregate volume for crude oil

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Speaker 1: prices going into the late April early May highs was

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Speaker 1: massively diverging that price move, So we had low volume

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Speaker 1: lower than the fifteen day average for almost two as

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Speaker 1: crude oil prices made significantly higher. Hot. Well, this has

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Speaker 1: been great, Pulciana, thanks so much. Let's make it often occurrence.

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Speaker 1: He is with Bank of America, not Marylynch. On the

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Speaker 1: technicals and the courses. Lead call is for weaker oil.

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Speaker 1: He just simply says, sell the news. That's great to see. Michael,

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Speaker 1: I mean Paul joined the stages, ago, wrote an authoritative

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Speaker 1: book on technical analysis, and now really puts it uh

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Speaker 1: together into work for Mr Moynihan's fortress. Futures up to down,

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Speaker 1: futures up seven atturning to them markets stay with this

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