2021

USDCHF tests daily support, AUDUSD consolidates gains, EURGBP falls below daily support

John Benjamin 03.01.2022 09:59

USDCHF tests daily support The US dollar softens over increased risk appetite. A drop below the lower band of the consolidation range at 0.9160 confirms a lack of interest in the greenback. The pair is testing the major demand zone around 0.9100 from the daily chart. A bearish breakout could jeopardize the pair’s rebound over the past quarter. It could also trigger a sell-off towards the psychological level of 0.9000. The bulls may be tempted to buy the dip. 0.9180 would be the first resistance to lift before they could turn the downbeat inertia around. AUDUSD consolidates gains The Australian dollar finds support from rising commodity prices. A bullish MA cross on the daily chart indicates improvement in underlying sentiment. The former supply zone between 0.7210 and 0.7220 has turned into a demand zone. Buyers may be eager to join the rally after the RSI returned to the neutrality area. 0.7290 is a fresh resistance, and a combination of profit-taking and fresh selling could temporarily weigh on the Aussie. 0.7120 is a second line of defense in case of a deeper retracement. EURGBP falls below daily support The pound outperforms the euro over diverging monetary policies. The break below the daily support at 0.8380 is an invalidation of the rebound in late November. The RSI’s repeatedly oversold situation has attracted some buying interest, but not enough to sustain a meaningful bounce. 0.8420 is now a fresh resistance. And only its breach could prompt sellers to cover. On the downside, 0.8365 is a fragile support. A breakout would further deteriorate sentiment and send the euro to February 2020’s lows near 0.8280.

"Gold is in the 1960s"

Arkadiusz Sieron 31.12.2021 14:05

Although your calendar may say otherwise, gold is in the 1960s. The question is whether we will move into the 1970s or speed-run to the mid-2010s. Did you go overboard with your time travel and lose track of time? Probably not, but just in case, I assure you that the current year is 2021. To be 100% sure, I fact-checked it on a dedicated webpage for time-travelers. However, the authority of science is being questioned, and there are people who say that, from a macroeconomic point of view, we are approaching the 1970s, or at least the 1960s. There are also voices saying that the gold market is replaying 2012-2013. Although appearances point to 2021, let’s investigate what year we really live in. The similarities with the 1970s are obvious. Just like then, we have high inflation, large fiscal deficits (see the chart below), and easy, erroneous monetary policy. Fifty years ago, the Fed blamed inflation on exogenous shocks and considered inflation to be transitory too. The new monetary regime adopted by the US central bank in 2020 also takes us back to the 70s and the mistaken belief that the economy cannot overheat, so the Fed can let inflation run above the target for a while in order to boost employment. The parallels extend beyond price pressure. The withdrawal of US troops from Afghanistan reminded many of the fall of Saigon. The world is facing an energy crisis right now, another feature of the 1970s. If we really repeat those years, gold bulls should be happy, as the yellow metal rallied from $35 to $850, surging more than 2300% back in that decade (see the chart below). However, there is one problem with this narrative. In the 1970s, we experienced stagflation, i.e., a simultaneous occurrence of high inflation and economic stagnation with a rising unemployment rate. Currently, although we face strong upward price pressure, we enjoy economic expansion and declining unemployment, as the chart below shows. Indeed, the monthly unemployment rate decreased from 14.8% in April 2020 to 4.2% in November 2021. The current macroeconomic situation, characterized by inflation without stagnation part, is reminiscent of the 1960s, a decade marked by rising inflation and rapid GDP growth. As the chart below shows, the CPI annual rate reached a local maximum of 6.4% in February 1970, similar to the current inflation level. Apparently, we are replaying the 1960s right now rather than the 1970s. So far, growth is slowing down, but we are far from stagnation territory. There is no discussion on this. My point was always that the Fed’s actions could bring us to the 1970s, or that complacency about inflation is increasing the risk of de-anchoring inflation expectations and the materialization of a stagflationary scenario. In the 1960s, the price of gold was still fixed, so historical analysis is impossible. However, it seems that gold won’t start to rally until we see some signs of stagnation or an economic crisis, and markets begin to worry about recession. Given that the current economic expansion looks intact, the yellow metal is likely to struggle at least by mid-2022 (unless supply disruptions and energy crisis intensify significantly, wreaking havoc). Do we have to go back that far in time, though? Maybe the 2020 peak in gold prices was like the 2011 peak and we are now somewhere in 2012-2013, on the eve of a great downward move in the gold market? Some similarities cannot be denied: the economy is recovering from a recession, while the Fed is tightening its monetary policy, and gold shows weakness with its inability to surpass $1,800. So, some concerns are warranted. I pointed out a long time ago the threat of an upward move in the real interest rates (as they are at record low levels), which could sink the precious metals market. However, there are two key differences compared to the 2012-2013 period. First, inflation is much higher and it’s still accelerating, while ten years ago there was disinflation. This distinction should support gold prices. The peak in the inflation rate could be a dangerous time for gold, as the disinflationary era would raise interest rates, putting downward pressure on the yellow metal. Second, the prospects of the Fed’s tightening cycle are probably already priced in. In other words, the next “taper tantrum” is not likely to happen. It implies that a sudden spike in the interest rates similar to that of 2013 (see the chart below) shouldn’t repeat now. Hence, the answer to the question “what year is it?” should be that we are somewhere in the 1960s and we can move later into the 1970s if high inflation stays with us and stagnation sets in or if the next crisis hits. However, we can leap right into the 2010s if inflation peaks soon and the hawkish Fed triggers a jump in bond yields. It’s also possible that we will see a temporary disinflation before the second wave of elevated inflation. So, gold could continue its struggle for a while before we see another rally. Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care.

Quiet Start to New Year

Marc Chandler 03.01.2022 14:10

January 03, 2022 $USD, autos, Canada, China, Currency Movement, Inflation, jobs, Mexico, PMI, Trade Overview: The New Year begins slowly. Japan, mainland China, Australia, New Zealand, and the UK markets remain closed. While Hong Kong shares traded heavily, Taiwan, South Korea, and India moved higher. Led by consumer discretionary and staple sectors, Europe's Stoxx 600 is up about 0.6%. US futures are 0.4%-0.6% higher. European yields have drifted lower, with the periphery doing bettter than the core. The US 10-year yield will begin the local session at 1.51%. The dollar is mostly firmer, after weakening broadly at the end of last year. The Norwegian krone and New Zealand dollar are the most resilient, while the Canadian dollar is off nearly 0.3% to pare the year-end gains, followed by the euro, which is in the middle of its $1.1335-$1.1380 range. The greenback is holding above JPY115.00. Emerging market currencies are mixed but mostly softer. Higher than expected inflation is weighing on the Turkish lira. The South Korean won leads the other softer EM currencies. It is off about 0.25%. The South African rand (~0.7%) and Russian ruble (0.5%) lead the advancers. The JP Morgan Emerging Market Currency Index rose by about 2.5% in the last two weeks of 2021 and is slightly firmer today (~0.2%). Iron ore is higher for the third consecutive session and rallied more than 45% from the middle of November through Xmas, before falling 5.3% last week. Copper has a four-week 4.6% rally in tow but is slightly softer today. Gold is stalling near $1830, the (61.8%) retracement of its sell-off from $1880 mid-November high. Oil rallied for the last two weeks, with February WTI gaining about 6.2%. OPEC+ meets tomorrow and WTI is up a nearly 1.5% to push above $76. US natural gas gained slightly more than 1% in the past two weeks and is hovering around little changed level. Recall that diverted shipments from the US and Asia to Europe saw natural gas prices collapse from above 180 euros on December 21 to 65.5 euros at the end of last week. Asia Pacific China's property developers remain in the spotlight. Bloomberg estimates that the sector's debt servicing costs, including deferred wages, and maturing obligations are at $197 bln this month. Evergrande shares were suspended in Hong Kong. When the problems, bubbling below the surface for some time, emerged last September, global risk appetites were shaken, and many observers made comparisons to the Great Financial Crisis. However, so far, the problems seem localized and unlike the US and Europe, new lending has not frozen. The macro data highlights include China's Caixin PMI after the official one surprised on the upside. The preliminary PMIs for Australia and Japan steal the thunder from the final report. Japan's weekly MOF report on portfolio flows may be noteworthy. Foreign investors have been on a buying spree, buying the most Japanese bonds over the first three weeks of December in at least 20 years. The dollar has risen for the past four weeks against the Japanese yen. It closed the last two sessions slightly above JPY115.00 and remains above it today. Recall, last year's high, set in late November, was near JPY115.50. Today's high thus far is about JPY115.35. The market may be reluctant to push the dollar much higher before Tokyo returns. The Australian dollar advanced almost 2% in the second half of December. It is stalling near the (50%) retracement of its decline from around $0.7555 in late October, found close to $0.7275. Support is ahead of $0.7200. Thin trading on New Year's Eve saw the dollar plunge to its low for the year near CNY6.34 before settling slightly above CNY6.3560. Chinese officials have signaled their desire to avoid further yuan appreciation. If the divergence of monetary policy and higher fx reserve requirements are not sufficient, investors must be wary that other tools can be deployed. Europe The uptick in Germany's December manufacturing PMI was revised away, leaving it unchanged from November at 57.4. The flash estimate put it at 57.9. In contrast, the French reading was revised up to 55.6 from 54.9. This pared the decline from 55.9 in November. Italy's manufacturing PMI held in better than expected, slipping to 62.0 from 62.8, the post-Covid high. Spain, on the other hand, disappointed, with its manufacturing PMI falling to 56.2 from 57.1, its lowest since last February. The net result was the flash aggregate estimate of 58.0 was sustained (58.4 in November). The final Eurozone aggregate PMI is of passing interest. The main takeaway from the preliminary estimate continues to resonate: the economic activity was slowing. The flash estimate put the composite at 53.4 (down from 55.4), the lowest since March. It has risen once in the last five months. More notable for the market will be the preliminary estimate of December inflation. Consumer prices are expected to have stabilized after reaching 4.9% year-over-year in November (2.6% core). The Turkish government has tried to absorb the currency-risk that it has unleashed by forcing the central bank to cut key interest rates by 500 bp since mid-September. It managed to spur a powerful short-covering squeeze in the lira, which saw the dollar fall from around TRY18.36 on December 20 to nearly TRY10.25 on December 23. The greenback recovered to nearly TRY14.00 today, its sixth consecutive advance. Today's CPI report blew away expectations. Just in the month of December, Turkish consumer prices jumped nearly 13.6%. This sent the year-over-year rate to almost 36.1%. The core rate rose about 31.9% year-over-year. Short covering helped lifted the euro a little more than 1.1% over the past two weeks. It reached about $1.1385 on New Year's Eve. It has not traded above $1.14 since mid-February. Ahead of this week's two key economic reports (EMU CPI and US employment), the market may not have the conviction necessary to extend its year-end gains. Sterling gained about 2.1% in the last two weeks. It reached $1.3550 at the end of last week, its best level since mid-November. It is little changed today. The $1.3575 area corresponds to the (50%) retracement of its sell-off from $1.3835 area in late October. Initial support is seen in the $1.3455-$1.3465 area. America The US economic diary is jammed packed to begin the New Year. The highlight is the jobs report at the end of the week. The median forecast (Bloomberg survey) calls for a 400k increase after being disappointed with the 210k increase in November. The unemployment rate is expected to ease to 4.1% from 4.2%, and average earnings growth likely moderated. At the end of last year, an article in the Financial Times made two important observations. First, the uniqueness of the covid-impact renders seasonal adjustments suspect. The response rate was less than two-thirds, the lowest for the month of November in more than a decade. In November, the raw establishment survey showed a 778k gain in nonfarm payrolls, but the BLS adjustment cut a record 568k. Second, also complicating the data is the participation by businesses. The response rate was less than two-thirds, the lowest for the month of November in more than a decade. The monthly auto sales report seems under-appreciated as a broad economic indicator. The supply chain disruptions depressed auto production and, in turn, auto consumption (not just in the US). However, late in the year, there seemed to be some improvement. The median forecast (Bloomberg survey) December US auto sales (seasonally adjusted annual rate) at 13.1 mln, which would then be the most since July. Elsewhere, the preliminary goods trade balance, like the flash PMI, is the real new news. The final reading tends not to be very meaningful. In any event, the trade deficit will widen considerably. The goods deficit widened to a record $97.8 bln from $83.2 bln. Lastly, the FOMC minutes will be looked at especially for clues about the timing of the first hike. March? It is unreasonable to expect Canada to match the nearly 154k job increase reported for November. The median forecast is 25k. Canada also reports November trade figures. Canada's trade balance has steadily improved since March 2020, and the 12-month moving average through October was the highest in around six years. The swaps market has a little more than half of the first hike (25 bp) priced in at the January 26 Bank of Canada meeting. Mexico's data highlights include worker remittances, which could be the most important source of private capital inflows. Without meaningful fiscal support and in the face of tightening monetary policy, the economy lacks much momentum. The December CPI is expected to have edged higher toward 7.5%. Monetary policy is where the drama will be as the new central bank governor takes the reins (Rodriguez). The 50 bp hike in December lifted the overnight target to 5.5%. If the market is concerned about a policy mistake or possible erosion of its independence, you would not know it from looking at the peso. It was the strongest currency in the world in December, rising almost 4.5% against the dollar. The Canadian dollar rallied about 2% over the past two weeks. This saw the US dollar retrace half of its rally from the mid-October low below CAD1.23 that peaked on December 20 by CAD1.2965. That retracement came it near CAD1.2625. The momentum indicators are still headed down, but the greenback is recovering today. Initial resistance is seen around CAD1.2700. A move above CAD1.2750 warns that a low may be in place. The Mexican peso has rallied for the past five weeks, and despite the poor close at the end of the year, it is bid today. The US dollar was sold from near MXN20.55 to MXN20.45 in the European morning but has found a bid near midday. The low from New Year's Eve was set around MXN20.3070 and the 200-day moving average is closer to MXN20.27. Disclaimer

A Look At Markets Around The World: US CPI, Sweden Riksbank EU Yields And More

Taxes, UK Equities, Global Shipping and Pandemic in "Charts of 2021: Honorable Mentions" by Callum Thomas

Callum Thomas 03.01.2022 14:13

Last week I shared with you some of my Best Charts of 2021 (as well as my Worst Charts of 2021 and then also my favorites!) -- so this week I wanted to follow up with what I would say are the "honorable mention" charts of 2021... These charts were worthy of mention but didn’t quite fit into any of the previous categories -- but were definitely worth including and highlighting both due to how they proved useful in the past year or so, but also in terms of the outlook into 2022. These charts were featured in my just-released 2021 End of Year Special Report -- check it out (free download as a holiday treat!). Enjoy, feel free to share, and be sure to let me know what you think in the comments... 1. Expect Higher Taxes: This chart arguably points to higher tax rates ahead given that government debt as a % of GDP has doubled over the past decade while effectively economy-wide tax-take has gone sideways. chart of developed economy fiscal outlook - higher taxes forecast 2. Global Food Crisis? Stagnant capex by food producers contributed to a perfect storm for food prices (along with actual storms, pandemic disruption, rising costs). 3. UK Equities: In the wake of Brexit & pandemic woes, UK equities moved to decade-low valuations vs their European peers. From crisis to opportunity? >>> These charts were featured in our 2021 End of Year Special Report. 4. Global Shipping Capex: Shipping sector investment stagnated for a decade – contributing to the global supply chain chaos. Ironically it likely rebounds after banking windfall profits from the surge in freight rates. 5. Global vs US Earnings Cycles: A key driver of the long-term cycles of relative price performance of global vs US equities has been the cycles in relative earnings. That cycle will need to change for the price cycle to change. 6. Pandemic Progress: the global rollout of vaccines, rising immunity, societal adaptations, and therapeutics have helped result in a series of lower highs in deaths – I like the look of that trend. The light at the end of the tunnel, though flickering at times, does seem a little brighter now… Thanks for reading! This is an excerpt from my 2021 End of Year Special report - click through to download a free copy of the report. Best regards Callum Thomas Head of Research and Founder of Topdown Charts Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts

SEC Rejects Valkyrie, Kryptoin Spot Bitcoin ETF Applications

Bitcoin price eyes higher high, Ethereum price to revisit crucial barriers

FXStreet News 03.01.2022 16:07

Bitcoin price bounces off the $45,678 support level, suggesting a higher high is likely. Ethereum price looks primed for a sweep of the $4,133 resistance level to collect the liquidity resting above it. Ripple price might head lower to retest the 3-day demand zone, ranging from $0.704 to $0.778 before it triggers a run-up. Bitcoin price has been stuck, ranging between two crucial levels since the December 3 flash crash. This consolidation is setting up the base for a long-term volatile move, but for now, BTC is likely to retest the range high of this sideways move. Ethereum and Ripple will promptly follow the big crypto and see short-term gains. Bitcoin price eyes higher high Bitcoin price bounced off the $45,678 support floor for the fourth time and is currently hovering at $46,921, just below the 200-day Simple Moving Average (SMA). A surge in bullish momentum that overcomes this hurdle is likely to propel the pioneer crypto to tag the $51,993 resistance barrier, coinciding with the 50-day SMA. A sweep of this level will collect the buy-stop liquidity resting above it. This 13% upswing is likely to face profit-taking at this level, leading to a reversal. However, in some cases, the buyers could flip this level to a support floor, suggesting that Bitcoin price might head higher and retest the $57,030. BTC/USD 4-hour chart While things are looking up for Bitcoin price, a breakdown of the $45,678 support floor will reveal a weakness among buyers. This move will crash BTC by 9% to retest the December 3, 2021 swing low at $41,672. Here, Bitcoin price has another chance to make a comeback and will likely restart the upswing. Ethereum price to revisit crucial barriers Ethereum price revisited the $3,640 support floor for the third time on December 31, 2021, triggering a 5% ascent to where it currently trades - $3,800. Unlike the big crypto, ETH is comfortably trading above the 200-day SMA. A potential spike in buying pressure is likely to propel Ethereum price to retest the $4,113 resistance barrier, coinciding with the 50-day SMA. This run-up would constitute an 8.4% ascent and is likely to see the short-term upswing capped. If the buyers continue to pile on the bid orders, ETH might slice through the said hurdles and make a run for the $4,435 ceiling, representing a 16% gain. ETH/USD 6-hour chart In some cases, Ethereum price might revisit the $3,640 barrier before heading to the immediate resistance barrier. A breakdown of this level, however, will lead to a retest of the December 3, 2021 swing low at $3,456, where buyers have another chance to restart the uptrend. Ethereum primed for 50% breakout to $6,300 Ripple price could head lower Ripple price is hovering above the 3-day demand zone, ranging from $0.704 to $0.778 and is likely to retest it before it decides to head higher. A dip into this area will replenish the bullish momentum, allowing the XRP price to climb higher. The $0.892 resistance barrier will be the first hurdle the remittance token will tag, beyond which it is likely to collect the liquidity resting above the $0.939 ceiling. In some cases, Ripple price could extend its run-up to $1, where it will face immense selling pressure. XRP/USD 4-hour chart Regardless of the recent run-up, if Ripple price slices through the 3-day demand zone, extending from $0.704 to $0.778, and produces a decisive close below it, the bullish thesis will face invalidation. In which case, the XRP price could slide lower to revisit the $0.656 support floor. XRP price to present long opportunity for Ripple bulls at $0.87

How Omicron affects American dollar (USD)? What about monetary policy and FED?

FXStreet News 03.01.2022 16:07

Markets remain optimistic about Omicron, weighing on the dollar, but that may change. Speculation about the Fed's hike timing is set to increase with the bank's minutes and the NFP. All other factors are only a distraction from these themes. New year, same factors moving the greenback – the impact of Omicron and Fed speculation. The most important market-mover is Omicron – the highly contagious COVID-19 variant. After roughly six weeks, we know that it is extremely contagious but causes less severe disease than previous strains such as Delta. Markets currently see the glass half-full, hoping that this wave would subside as quickly as it rises, and even help people become more protected against other variants of the virus. Optimism is good for stocks and weighs on the safe-haven dollar. On the other hand, we have already seen how infections among aircrew caused a massive cancellation of flights over the holiday season. Moreover, while a lower percentage of infected people become sick, the sheer number of cases means hospitals could still come under pressure and that could trigger governments to impose restrictions. Now that the holidays are over, it would be politically easier to impose new curbs. When worries take over, stocks fall and the dollar rises. The dollar's second market-mover is the long-term one of monetary policy. The Federal Reserve is set to raise interest rates sometime in 2022, but the timing of the first move is still unknown. The hawkish twist from Fed Chair Jerome Powell – who accelerated the tapering process in December – already boosted the greenback in 2021. The main worry for the Fed is that inflation is rising more than anticipated – it is no longer transitory. Will the Fed raise rates as soon as March, wait until May as markets price, or leave it til June? Hints could come with the Fed's meeting minutes published on Wednesday and also Nonfarm Payrolls on Friday. A strong jobs report – especially one accompanied by a robust increase in wages – could send the dollar higher on expectations for an early move from the Fed. Disappointing data would do the opposite. Beyond Omicron and Fed speculation, other factors are minor – these include worries about China's Evergrande, tensions between Russia and Ukraine, and commentary by market analysts about the prospects of the global economy. These factors come into play only in the absence of virus or inflation fears.

Let's have a look at S&P 500, Crude Oil, Nasdaq and Credit Markets. Cryptos are still bullish above mid-Dec lows.

Monica Kingsley 03.01.2022 15:57

S&P 500 pared prior steep gains, but thanks to the credit markets message, I‘m not reading into Friday‘s weakness much. There is still more in this rally – value held better than tech, and high yield corporate bonds didn‘t really slide. The year end rebalancing will likely give way to solid Monday‘s performance. While VIX appears to want to move up from the 17 level, it would probably take more than one day to play out. As the Santa Claus rally draws to its close, the nearest data point worth looking forward for, is Tuesday‘s ISM Manufacturing PMI. It‘ll likely show still expanding manufacturing (however challenged GDP growth is on a quarterly basis), and that would help commodities deal with the preceding downswing driven by energy and agrifoods. Both of these sectors are likely to return to gains, and especially oil is. As stated on Thursday, the open profits would still keep rising. Precious metals were the key winners Friday, paying attention to the dollar and nominal yields retreat the most. The red metal‘s upswing certainly helped – such were my latest words: (…) copper is primed to catch up in the short run to the other commodities, gold is well bid at current levels, and together with silver waiting for a Fed misstep (market risk reappreciation) and inflation to start biting still some more while the real economy undergoes a soft patch (note however the very solid manufacturing data) with global liquidity remaining constrained even though the Fed didn‘t exactly taper much in Dec, and nominal yields taking a cautious and slow path towards my 2022 year end target of 1.80-2.00% on the 10-year Treasury. As I wrote prior Monday, we‘re looking at still positive 2022 returns in stocks – of course joined by commodities and precious metals. The path would be though probably a more turbulent one than was the case in 2021. Finally, cryptos look to be in agreement with not reading too much to Friday‘s downswings – both Bitcoin and Ethereum are turning up as $46K in BTC held up once again. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook Nasdaq got a little oversold relative to S&P 500 – this is not the start of a fresh downtrend. Once financials and consumer discretionaries turn up, the rally will be on better footing again. Credit Markets HYG could have declined some more, but tellingly didn‘t. Bonds aren‘t ready to turn to risk-off just yet. Upswing attempt next shouldn‘t be surprising in the least. Gold, Silver and Miners Gold and silver are looking at a much better year than was 2021. Stock market volatility, GDP growth challenges and persistent inflation would help the metals and commodities rise. Crude Oil Crude oil is about to move up again as gains were taken off the table on Friday. With the omicron response and related pronouncements coming in lately from the U.S., what else to expect – a great deal of destroyed demand doesn‘t look to be ahead. Copper Copper undid the prior pause, and looks ready to keep defending the $4.43 area. The long consolidation that started in May, would be eventually broken to the upside. Bitcoin and Ethereum Bitcoin and Ethereum may be short-term undecided, but don‘t look willing to decline. Cryptos are still bullish above mid-Dec lows. Summary First trading day of 2022 is likely to extend prior gains, resolving the prior sideways move. As risk-on faltered on Friday, S&P 500 and cryptos are likely to catch up, and oil would probably outperform copper today while precious metals digest very solid New Year‘s Eve gains. We‘re nowhere near the good days ending just yet – turbulence would come once Fed tapering gets really noticeable (post Olympics), with VIX trending higher well before that already. Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.

NZDUSD can be ahead of consolidation, XAGUSD - silver declines as dollar strengthens, GER 40 goes up, "wishing" Omicron won't hit that much

John Benjamin 04.01.2022 09:14

NZDUSD breaks support The New Zealand dollar tumbles against its US counterpart amid soaring Treasury yields. The pair is looking to consolidate its recent gains after it rallied above the 30-day moving average (0.6820). The December high at 0.6860 is a major resistance. A bullish close may propel the kiwi to 0.6950. In the meantime, the pullback below 0.6800 suggests a lack of further commitment from the buy-side as short-term traders took profit. 0.6740 is the next support and its breach may lead to a correction to 0.6700. XAGUSD seeks support Silver falls back as the US dollar strengthens across the board. Price action saw a strong recovery from the daily support at 21.50. A rally above 23.15 indicates interest in keeping the rebound valid, following a brief end of the year sell-off. The double top at 23.40 is an important resistance on the way to 23.70. This point lies in a supply zone from the late November sell-off. A break below the psychological level of 23.00 has prompted intraday buyers to bail out. 22.60 is the closest support and its breach could drive the metal to 21.80. GER 40 rises towards an all-time high The Dax 40 rallies in hopes that Omicron lockdowns can be avoided. A bullish MA cross on the daily charts indicates improved sentiment. The rally accelerated after it cleared the supply area around 15750. The bulls are pushing towards the all-time high at 16300. A breakout could resume the uptrend, attracting trend followers in the process. The RSI surged again into the overbought territory and may temper the bullish fever. 15840 is fresh support. 15680 from the previous resistance area would be a test for buyers’ resolve.

Does gold in the beginning of 2022 remind us year 2021? What about inflation this year?

Arkadiusz Sieron 04.01.2022 13:14

The start of 2021 wasn’t successful for gold: after a few days of rally, the yellow metal entered a bearish trend. 2022 looks uncomfortably similar. So far, so good – the first three days of 2022 didn’t bring a new catastrophe. It’s probably just the calm before the storm, but the new year started well. Even the price of gold has risen! As the chart below shows, the yellow metal managed to jump above the key level of $1,800 at the very end of 2021, but it still maintains its position (at least as of early January 3, 2022). It reminds me of the beginning of 2021. Gold also started last year with a bang, only to plunge later. Its price increased 3.5% during the first week of the year, reaching $1,957, and then began its big downward move. As the chart below shows, the yellow metal plunged below $1,700 at the very end of March. Hence, although January is historically a good month for gold, it might be too early to celebrate, and investors should exercise caution. However, luckily for gold bulls, there is one significant difference between 2021 and 2022. Last year, there were Georgia runoffs and Democrats took over both the White House and the full Congress (the House and the Senate). That was when the blue wave plunged the yellow metal. This year should be politically calmer for the US (so, we don’t count the odds of Russia invading Ukraine and China attacking Taiwan), but the major threat to the gold market remains the same: a rise in the real interest rates. In January 2021, it was the blue wave that triggered a rebound in rates, but it may be induced by many more factors in the future. It could be the development of a new cure against coronavirus and the end of the pandemic, a more hawkish Fed, or a decline in inflation. The spread of the Omicron variant keeps worries alive. After all, as the chart below shows, the 7-day rolling average of COVID-19 cases in the United States has hit a record high of about 405,000. When we are completely back to normalcy, risk appetite and bond yields may increase. Another risk for gold is the stabilization of inflation and even subsequent disinflation. As the chart below shows, we got a one-off boost in the money supply, so inflation is likely to peak this year. Inflation expectations should ease then, and real interest rates may rebound in such a scenario. What gives me some comfort here is that the pace of money supply growth hasn’t returned to the pre-pandemic level yet, but it stays at an elevated level (although much below the peak). It should support high inflation this year. Moreover, the Fed is likely to remain behind the curve and the peak in inflation may only strengthen the dovish camp within the FOMC (although investors should remember that the composition of the voting members of the Committee has become more hawkish in 2022). Implications for Gold What does it all imply for the gold market? Will the yellow metal resume its long-term bullish trend in 2022? Well, this is what a majority of investors that took part in Kitco News’ annual outlook survey believe. Of nearly 3,000 retail investors, 54% said they see gold prices above $2,000 by the end of the year. This is also in line with Goldman Sachs’ call for gold in 2022. Other forecasters see gold prices trading in a range between $1,800 and $2,000. It’s certainly a possible scenario. After all, much of the Fed’s tightening cycle has already been priced in; and the last time gold bottomed was in December 2015, just around the first hike in the federal funds rate after the Great Recession. However, I expect more volatile trading with strong downside potential. As a reminder, my educated guess is that gold may plunge at some point amid a rebound in bond yields, but will rise later as worries about the next economic crisis accumulate. Indeed, it’s quite funny, but I haven’t even finished this article, and the price of gold has already started to slide amid rising US dollar index and Treasury yields, in line with my warnings from the beginning of this text. This is how I became a prophet. Now I can see that as soon as you finish reading this article you will continue surfing the internet! If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Considering Portfolios In Times Of, Among Others, Inflation...

Dollar Eases

Marc Chandler 05.01.2022 13:19

January 05, 2022 $USD, auto sales, Currency Movement, Omicron, PMI, technology Overview: The tech sell-off in the US yesterday, ostensibly driven by higher rates, carried over into trading today. South Korea, China, and Hong Kong led the regional sell-off. News that China's zero Covid tolerance led to a lockdown of the city of Xian with a population of around 13 mln played on fears of more supply chain disruptions. A second city, Yuzhou, considerably smaller, has also been lockdown. Japan, India, and several smaller markets gain. European bourses, where tech is less prominent have edged higher and the Stoxx 600 is extending its gain for the third consecutive session. US futures are softer. Asia and most European bonds yields have risen today, while the US 10-year is steady around 1.64%. Of note, with Italian politics rising as an issue ahead of the presidential contest later this month, maybe helping lift the 10-year BTP to new six-month highs near 1.22%. The US dollar is seeing its recent gains trimmed against the major currencies. The Japanese yen is recovering a little after falling to five-year lows yesterday. The Canadian dollar is the laggard today, amid a sell-off in its bonds. The emerging market currency complex is mixed, and the JP Morgan EM FX index is recouping about half of yesterday's 0.35% loss. Gold is firm but remains within Monday's range (~$1798.50-$1832). Among the industrial metals we monitor, iron ore bounced back after yesterday's minor loss and is at its best level since Xmas eve. Copper is being turned back after yesterday's rally stalled near the $448 cap. Crude oil is consolidating yesterday's gain and February WTI is near $77.00. US LNG firm but within the $3.50-$4.00 range, while European (Dutch) is extending yesterday's dramatic gain (31.6%). Asia Pacific While China has moved quickly to impose lockdowns where cases of the virus appear, the tech sector is off to a poor start. The Heng Seng Tech Index fell 4.6% today, the most since July, and the third consecutive drop. Tencent is reducing its investments, and this took a toll on companies it backed. Some link Tencent decision to Beijing's push against anti-competitive practices. The NASDAQ Golden Dragon Index, which tracks Chinese lists companies fell 4.3% yesterday. The tech sell-off was also clear in the US where the NASDAQ shed 1.3%. Japan's "Mothers" gauge weighted toward small and medium-sized software and technology companies fell 5% to its lowest level since May 2020. In the last hours of trading, after HK tightened social restrictions, the equity loss intensified. Japan reported that December auto sales were 10.2% lower than a year ago. Yesterday, the US reported disappointing December auto sales. Auto sales were expected to have risen to their best level since August but instead fell to a 12.44 mln unit annual pace. It was the lowest since September and reflects a 23.6% decline from December 2020. Last year, US auto sales averaged 14.93 mln a month compared with 14.41 mln in 2020 and 16.91 mln in 2019. Although supply is argued to be a bigger problem than demand, some producers, like GM, have reported a substantial rebuilding of inventories. The dollar closed above JPY116.00 yesterday but has failed to sustain the upside momentum. It peaked near JPY116.35 and is approaching support at the previous resistance around JPY115.50. A break of JPY115.00, which seems unlikely ahead of the US jobs data on Friday, would lend credence to the idea that it was a false breakout. The Australian dollar is firm near $0.7250 after recovering from the dip below $0.7200. Still, it needs to resurface above $0.7275-$0.7280 to be notable. We suspect the Aussie will pullback in North America and see initial support around $0.7220. Outside of the dramatic year-end session, the Chinese yuan continues to trade quietly in a well-worn range. The dollar continues to trade mostly between CNY6.3660 and CNY6.3830. The PBOC set the dollar's reference rate at CNY6.3779. The (Bloomberg) survey found a median expectation for CNY6.3773. Note that offshore yuan (CNH) swaps/forward points are at their lowest level since April 2020 amid reports that overseas branches of state-owned banks are continuing to lend out CNH. Lastly, we note that the China Securities Journal plays up the possibility that the PBOC eases policy ahead of the Spring Festival holiday (January 31). Europe The main economic news from the eurozone today is the final reading of the December service and composite PMI. The takeaway is that it is a little softer than the preliminary estimate. On the aggregate level, the service PMI eased to 53.1 from 53.3 flash estimate and 55.9 in November. The composite eased from 55.4 in November to 53.4 preliminary estimate and 53.3 final. It is the lowest since March and is the fourth decline in five months. While the German services PMI was revised higher, it remains below 50 boom/bust (48.7) and this coupled with the weakness in manufacturing saw the composite revised to 49.9 from 50.0 initially and 52.2 in November. It is the weakest composite reading since June 2020. France's service PMI slipped to 57.0 from the 57.1 flash reading and 57.4 in November. The composite was revised higher to 55.8 from 55.6. It stood at 56.1 previously. Italy and Spain disappointed with readings of both the service and composite below expectations. The Italian composite stands at 54.7 down from 57.6. Spain's composite is at 55.4 from 57.6 in November. Intervention by the Swiss National Bank draws attention as the euro traded at six-year lows at the end of last year. Sight deposits rose by CHF3.37 bln in December after CHF2.27 bln and CHF2.57 bln in November and October, respectively. Overall, sight deposits rose by CHF18.85 bln in 2021 after surging CHF119.3 bln in 2020. Denmark also anchors its monetary policy in the exchange rate peg to the euro. Its central bank sold DKK47 bln (~$7.1 bln) in December to defend the peg. It was the largest intervention in seven years. Although inflation is running a little below 4%, there is some speculation that the Danish central bank may have to cut rates as its next defense of the peg. The euro is trading inside yesterday's (~$1.1270-$1.1320) range. It is difficult for bulls or bears to find much to like with it hovering around the middle of the two-cent range that has confined it for nearly two months. The 480 mln euro option at $1.1290 that expires today has likely been neutralized, but there are options at $1.1275 for 1.3 bln euros that expires tomorrow that may be in play still. Sterling is steady at the upper end of yesterday's range when it briefly poked above $1.3555. It is the highest it has been since November 10. An option for GBP375 mln at $1.3505 expires tomorrow. Initial support is seen near $1.3520, and a break could test support in the $1.3480-$1.3500 area. America ADP 's private sector jobs estimate is the early feature in the US today. The median estimate (Bloomberg survey) is for an increase of 410k after 534k in November. The final PMI will likely draw little attention. The FOMC minutes from last month's meeting, at which officials announced the acceleration of tapering will be looked upon for insight into the Fed's balance sheet and any signal that it may allow maturing issues to roll-off soon. Besides the rate hikes, for which the market has priced in three this year, the balance sheet is quickly emerging as the new focus. Also, on tap today is the EIA inventory data. The API reportedly showed a large rise in gasoline inventories but another drop (6.4 mln barrels) in crude stocks. Canada's build permits are not typically a market mover. Tomorrow it reports the November trade balance, and the highlight is Friday's jobs data. It is difficult to envision a report as strong as November’s nearly 154k increase. Proportionately, it would be as if the US nonfarm payrolls rose by around 1.7 mln. Mexico reports December domestic auto sales. In November, its auto sales were off about 13.5% year-over-year. The highlight of the week is Friday's CPI figures. The year-over-year pace is expected to have edged up from 7.37% in November. The US dollar is trading inside yesterday's range against the Canadian dollar (~CAD1.2665-CAD1.2765), which was inside Monday's range (~CAD1.2630-CAD1.2780). It is trading around CAD1.2720 near midday in London. The intraday technical indicators seem to favor a retest of the greenback's highs. The US dollar's performance against the Mexican peso is similar. It is inside yesterday's range, which was inside Monday's range (~MXN20.41-MXN20.65). The US dollar looks soft and could test the December 31 low near MXN20.33. The 200-day moving average is near MXN20.27 and the greenback has not traded below it in a little more than two months. Disclaimer

Gold and silver - The beginning of the year 2022 may not satisfy

Przemysław Radomski 04.01.2022 16:10

Gold, silver, and mining stocks started 2022 with a bang. However, this wasn’t the kind of fireworks investors were hoping for. While gold, silver, and mining stocks partied hard into year-end, the trio woke up to massive hangovers on Jan. 3. Although I’ve been warning for some time that mining stocks would stumble in 2021, the New Year is still filled with old problems. For example, the GDX ETF has been making lower lows and lower highs for months, and when its RSI (Relative Strength Index) approaches 70, the senior miners often run out of gas. For context, I highlighted the events with the blue vertical dashed lines below. Moreover, with the senior miners’ current price action following the ominous paths of 2000, 2008, and 2013, and their stochastic indicator still signaling overbought conditions, Monday’s weakness may be a sign of things to come. Please see below: Please also consider the implications of year-end tax-loss harvesting. With the general stock market rallying to start the New Year, losing positions that were sold to offset capital gains near the end of 2021 were likely repurchased on Jan. 3. However, gold, silver, and mining stocks didn’t benefit from the phenomenon. As a result, while the GDX ETF may have outperformed gold, the relative strength was immaterial within the overall picture. Turning to the HUI Index’s long-term chart, the same bearish forecast is present. For example, I marked the specific tops with red and black arrows. In the current situation, we saw yet another small move up, but that’s most likely because price moves are now less volatile. The areas marked with red ellipses remain similar and show back-and-forth movement before the big decline. As a result, we’ve entered a consolidation phase, and the implications are not bullish, but bearish. Making three of a kind, the GDXJ ETF’s corrective upswing has likely run its course. Interestingly, the junior miners’ current rally mirrors the small correction that materialized in mid-2021. Back then, the GDXJ ETF rallied on low volume and didn’t recapture its 50-day moving average. With the same tepid strength present today, the drawdown that followed in mid-2021 will likely commence once again. On top of that, the behavior of the GDXJ ETF’s RSI is also similar – with the indicator moving from roughly 30 to 50. For context, I highlighted the similarities with green and purple ellipses below. Also noteworthy, similar developments occurred in February/March 2020, before the profound plunge unfolded. As a result, the GDXJ ETF looks set for another sharp drawdown over the medium term and predicting higher prices might be misleading. Finally, while my short position in the GDXJ ETF proved quite prescient in 2021, the junior miners continue to underperform the senior miners. With the GDX/GDXJ ratio likely to confront new lows in the coming months, the GDXJ ETF should remain a material laggard in 2022. In conclusion, gold, silver, and mining stocks started off 2022 with a bang. However, it wasn’t the kind of fireworks that investors were hoping for. With each new celebration shorter in magnitude, it’s likely only a matter of time before their parties are canceled. As a result, the precious metals still confront the same bearish technical outlooks that plagued them in 2021. While mean reversion remains undefeated over the long term, the wait may prove longer than many expect. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Dogecoin (DOGE) is definitely worth watching as a rally may happen

FXStreet News 04.01.2022 15:55

Dogecoin price is setting up a triple bottom setup on a 4-hour time frame, suggesting a reversal is likely. Investors can expect DOGE to rally 13% and retest the $0.191 resistance level. A breakdown of the $0.20 support floor will create a lower low and invalidate the bullish thesis. Dogecoin price has been stuck trading below a vital resistance level and hovering around a crucial support floor. While a breakdown of this foothold could result in a massive downswing, DOGE has not done it yet. As of this writing, the meme coin eyes a minor upswing. Dogecoin price looks to contest significant hurdles Dogecoin price has set up a triple bottom pattern after tagging the $0.168 support level thrice over the past week. This price action could result in a short-term increase in buying pressure, leading to a 13% ascent to $0.191. Due to consolidative price action between December 24 and December 27, 2021, there is now pent-up buy-stop liquidity resting above $0.191, and market makers are likely to push DOGE higher in the short term. Traders can open a long position from the current level at $0.169 and take profits at $0.191. Interestingly, the 50-day Simple Moving Average (SMA) coincides with $0.191 lending credence to the target for Dogecoin Price. DOGE/USDT 4-hour chart On the other hand, if the Dogecoin price fails to bounce off the $0.169 support floor due to increased selling pressure, DOGE will likely revisit the $0.159 demand barrier. A breakdown of this foothold will create a lower low and invalidate the bullish thesis. In this case, Dogecoin price could crash 5% to tag the subsequent support level at $0.151.

Will 2022~23 Require A Different Strategy For TradersInvestors?

Chris Vermeulen 05.01.2022 16:33

Is The Lazy-Bull Strategy Worth Considering? - Part IMany traders struggled in 2021 with the extended price volatility and sideways price trends. Recently, news that Bridgewater's 2021 results were saved by December's +7.8% gain (Source: Yahoo! Finance) leads me to believe a number of independent funds and investors are going to have a tough end-of-year return for 2021.Average Hedge Fund Returns Less Than 25% Of The 2021 S&P500 GainsThe volatility in the US and global markets throughout most of 2021 took a toll on traditional trading strategies. With the VIX trading above 12 on average throughout almost all of 2021, traditional trading strategies may not have been able to adjust to this increased volatility in the US markets – getting chewed up along the way. I wrote an article series about how computerized trading strategies can fail when volatility levels increase beyond traditional boundaries a few weeks ago. You can read the first of the three part series, US Federal Reserve Actions 1999 to Present - What's Next?, and then link to the other two.(source: Aurum.com)Many of the best Hedge Funds could barely squeeze out a profit in 2021. While the S&P500 rallied more than 27% in 2021, you can see from the graphic above that the average returns for Hedge Funds in 2021 were a paltry +6.24%.Sign up for my free trading newsletter so you don’t miss the next opportunity! I expect that the US and global markets will continue to stay in extended price volatility ranges throughout all of 2022 and into 2023 as broad global market transitioning continues to take place. This expectation leads me to conclude that the “Lazy-Bull” strategy may be better suited for traders/investors over the next 24+ months than more active trading strategies.What Is The “Lazy-Bull” Strategy?The Lazy-Bull strategy is a term I use for my proprietary strategies – The Technical Investor and the Technical Index & Bond Trader. I call it the Lazy-Bull strategy because it is straightforward and only generates about 3 to 10 trades per year (on average). Many traders dislike this type of strategy because it it does not require many trades and does not provide the rush/roller coaster ride that many think they should feel while trading, which is not how it should be. Having said that, overall, this strategy has consistently produced positive annual results (CGAR average ROI 15% - 51% depending on ETF leverage, and only 7 - 21% drawdown) – beating the SPY almost every year. If you traded with the 1x, 2x, or 3x ETFs then you would have crushed the S&P 500 every year, and experienced that positive rush feeling that leverage/volatility provides.My trading style is a bit different than most other traders. My objectives consist of three very important concepts:Protect Capital At All TimesTrade Only When Strategically Opportunistic (probabilities are favorable)Trade Efficiently Using Bonds As Trade When Fear Rises among traders and investors.Through the Technical Investor and Technical Index and Bond Trading strategies, I help individuals and advisors learn how trading more efficiently using the Lazy-Bull strategies is for generating large compounded returns as shown in the SP500 chart below.I'll go further into detail regarding my strategies as we continue this multi-part article.Reading Into Q1:2022 – What To Expect?Right now, the world is waiting on Q4:2021 earnings and economic data. The first Quarter of 2022 should be very exciting for US traders as the year-end momentum of 2021 may carry forward into Q1:2022 with solid revenues and earnings. After that, we move into Q2:2022, which may be much more volatile overall.Let's look at our proprietary data mining utility to see what we might expect from the markets in the first Quarter of 2022.January 2022 has more than a 1.41:1 probability ratio of staying positive based on the past 29 years of historical data. Ideally, the average positive and negative monthly ranges are about equal – nearly $5.00. The accumulated monthly data shows that January is usually overall positive by at least $2.50 to $5.00.February 2022 has a much higher chance of extreme volatility. February 2022 shows a much greater positive to negative ratio while the possibility of a bullish February drops to a 1.33:1 probability ratio. Overall, I would suspect larger price volatility in mid to late February 2022 as the markets attempt to transition into late Q1 expectations.March 2022 has the same 1.41:1 probability ratio as January, yet the overall likelihood of extended downside price trends is about 20% greater than January.My analysis of this data suggests January and March of 2022 may surprise traders with a potential for a significant upward price move headed into Q2:2022. I believe Q4:2021 will also surprise traders as US consumers continue to engage and spend. This will lead to higher expectations for Q1:2022, which may set up a bit of a rally ahead of April/May 2022.Q1 and Q2, historically, seem to be strong in terms of traditional market growth and expectations. Yes, there have been instances when unexpected volatility disrupts the more customary types of trends – and 2022 may be one of those years. Our research shows the US Fed may make early efforts to move away from extreme easy money policies – which may shock the markets.Our research suggests the possibility of a 7% to 10% rally in the SPY in the First Quarter of 2022. If our extended research is accurate, our predictive modeling suggests more extreme price volatility may also play a significant role in how price trends/moves in 2022. Is The Lazy-Bull Strategy Worth Considering?In Part II of this article, we'll review the entire year of 2022 Quarterly Data Mining results and present more evidence that 2022 and 2023 may be years where a shift in strategy plays an important role for traders/investors. With the VIX trading above 15 more consistently, many strategies will get chewed up and spit out as the markets roll 9% - 15% up and down while attempting to transition away from the post-COVID stimulus.Get ready; 2022 will be an excellent year for traders with significant trends and bigger volatility. We just have to stay ahead of these trends to protect our capital and allow it to grow more efficiently. The risks of more traditionally moderate volatility systems getting chewed up in this extreme environment will continue. So be prepared to move towards a more protective trading style to survive the next 12 to 24 months.Want To Learn More About The Technical Investor and The Technical Index & Bond Trading Strategies?Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may start a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to take a few minutes to visit the Technical Traders website to learn about our Technical Investor and Technical Index and Bond Trading strategies and how they can help you protect and grow your wealth. Have a great day!

Will 2022~23 Require Different Strategies For TradersInvestors Part II

Chris Vermeulen 06.01.2022 00:19

Is The Lazy-Bull Strategy Worth Considering? Part III started this article by highlighting how difficult some 2021 strategies seemed for many Hedge Funds and Professional Traders. It appears the extreme market volatility throughout 2021 took a toll on many systems and strategies. I wouldn't be surprised to see various sector ETFs and Sector Mutual Funds up 15% to 20% or more for 2021 while various Hedge Funds struggle with annual returns between 7% and -5% for 2021.After many years in this industry and having built many of my own strategies over the past decade, I've learned one very important facet of trading strategy development – expect the unexpected. A friend always told me to "focus on failure" when we developed strategies together. His approach to strategy design was "you develop it do too well in certain types of market trends and volatility. By focusing on where it fails, you'll learn more about the potential draw-downs and risks of a strategy than ignoring these points of failure". I tend to agree with him.In the first part of this research article, the other concept I started discussing was how traders/investors might consider moving away from strategies that struggled in 2022. What if the markets continue trending with extreme volatility throughout 2022 and into 2023? Suppose your system or strategy has taken some losses in 2022, and you have not stopped to consider volatility or other system boundaries as a potential issue. In that case, you may be looking forward to a very difficult 12 to 14+ months of trading in 2022 and 2023.Volatility Explodes After 2017Current market volatility/ATR levels are 300% to 500% above those of 2014/2015. These are the highest volatility levels the US markets have ever experienced in the past 20+ years. The current ATR level is above 23.20 – more than 35% higher than the DOT COM Peak volatility of 17.15.As long as the Volatility/ATR levels stay near these elevated levels, traders and investors will likely find the markets very difficult to trade with strategies that cannot properly adapt to the increased risks and price rotations in trends. Simply put, these huge increases in price volatility may chew up profits by getting stopped out on pullbacks or by risking too much in terms of price range/volatility.Sign up for my free trading newsletter so you don’t miss the next opportunity!The increased volatility over the past 5+ years directly reflects global monetary policies and the COVID-19 global response to the crisis. Not only have we attempted to keep easy money policies for far too long in the US and foreign markets, but we've also been pushed into a hyperbolic price trend that started after 2017/18, which has increased global debt consumption/levels to the extreme.2022 and 2023 will likely reflect a very strong revaluation trend which I continue to call a longer-term "transition" within the global markets. This transition will probably take many forms over the next 24+ months – but mostly, it will be about deleveraging debt levels and the destruction of excess risk in the markets. In my opinion, that means the strongest global economies may see some strength over the next 24+ months – but may also see extreme price volatility and extreme price rotation as this transition takes place.Expect The Unexpected in 2022 & 2023The US major indexes had an incredible 2021 – rallying across all fears and COVID variants. The NASDAQ and S&P500 saw the biggest gains in 2021 – which may continue into early 2022. Yet I feel the US markets will continue to transition as the global markets continue to navigate the process of unwinding excess debt levels and potentially deleveraging at a more severe rate than many people expect.Because of this, I feel the US markets may continue to strengthen as global traders pile into the US Dollar based assets in early 2022. Until global pressures of deleveraging and transitioning away from excesses put enough pressure on the US stock market, the perceived safety of US assets and the US Dollar will continue as it is now.(Source: www.StockCharts.com)Watch For Sector Strength In Early 2022 As Price-Pressure & Supply-Side Issues Create A Unique Opportunity For Extended Revenues/ProfitsI believe the US markets will see a continued rally phase in early 2022 as Q4:2021 revenues, earnings, and economic data pour in. I can't see how any global economic concerns will disrupt the US markets if Q4:2021 data stays stronger than expected for US stocks and the US economy.That being said, I do believe certain sectors will be high-fliers in Q1:2022 and Q2:2022 – at least until the supply-side issues across the globe settle down and return to more normal delivery expectations. This means sectors like Automakers, Healthcare, Real Estate, Consumer Staples & Discretionary, Technology, Chip manufacturers, and some Retail segments (Construction, Raw Materials, certain consumer products sellers, and specialty sellers) will drive a new bullish trend in 2022.The US major indexes may continue to move higher in 2022. They may also be hampered by sectors struggling to find support or over-weighted in symbols that were over-hyped through the end of 2020 and in early 2021.I have been concerned about this type of transition throughout most of 2021 (particularly after the MEME/Reddit rally phase in early 2021). That type of extreme trending usually leads to an unwinding process. I still don't believe the US and global markets have completed the unwinding process after the post-COVID extreme rally phase.(Source: www.StockCharts.com)Will The Lazy-Bull Strategy Continue To Outperform In 2022 & 2023?This is a tricky question to answer simply because I can't predict the future any better than you can. But I do believe moving towards a higher-level analysis of global market trends when the proposed "transitioning" is starting to take place allows traders to move away from "chasing price spikes." It also allows them to position for momentum strength in various broader market sectors and indexes.I suspect we'll start to see annual reports from some of the biggest institutional trading firms on the planet that show feeble performance in 2021. This recent article caught my attention related to Quant Funds in China.I believe we will see 2022 and 2023 stay equally distressing for certain styles of trading strategies while price volatility and an extreme deleveraging/transitioning trend occur. Trying to navigate this type of choppy global market trending on a short-term basis can be very dangerous. I believe it is better to move above all this global market chop and trade the bigger momentum trends in various sectors and indexes.Part III of this research article will focus on Q1 through Q4 expectations for 2022 and 2023. I will highlight broader sector/index trends that may play out well for investors and traders who can move above the low-level choppiness in the US and global markets.WANT TO LEARN MORE ABOUT THE TECHNICAL INVESTOR AND THE TECHNICAL INDEX & BOND TRADING STRATEGIES?Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may begin a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to take a few minutes to visit the Technical Traders website to learn about our Technical Investor and Technical Index and Bond Trading strategies and how they can help you protect and grow your wealth.Have a great day!

Santa comes on a roller coaster this year! | MarketTalk: What’s up today? | Swissquote

Taking XAU/USD and NFP into consideration...

FXStreet News 05.01.2022 15:57

Nonfarm Payrolls in US is forecast to increase by 400,000 in December. Gold is likely to react more significantly to a disappointing jobs report than an upbeat one. Gold's movement has no apparent connection with NFP deviation four hours after the release. Historically, how impactful has the US jobs report been on gold’s valuation? In this article we present results from a study in which we analyzed the XAU/USD’s pair reaction to the previous 18 NFP prints*. We present our findings as the US Bureau of Labor Statistics (BLS) gets ready to release the December jobs report on Friday, January 7. Expectations are for a 400,000 rise in Nonfarm Payrolls following the 210,000 increase in November. *We omitted the NFP data for March 2021, which was published on the first Friday of April, due to lack of volatility amid Easter Friday. Methodology We plotted gold price’s reaction to the NFP release at 15 minutes, one hour and four hours intervals after the release. Then we compared the gold price reaction to the deviation between the actual NFP release result and the expected result. We used the FXStreet Economic Calendar for data on deviation as it assigns a deviation point to each macroeconomic data release to show how big the divergence was between the actual print and the market consensus. For instance, the August NFP data missed the market expectation of 750,000 by a wide margin and the deviation was -1.49. On the other hand, February’s NFP print of 536,000 against the market expectation of 182,000 was a positive surprise with the deviation posting 1.76 for that particular release. A better-than-expected NFP print is seen as a USD-positive development and vice versa. Finally, we calculated the correlation coefficient (r) to figure out at which time frame gold had the strongest correlation with an NFP surprise. When r approaches -1, it suggests there is a significant negative correlation, while a significant positive correlation is identified when r moves toward 1. Since gold is defined as XAU/USD, an upbeat NFP reading should cause it to edge lower and point to a negative correlation. Results There were ten negative and seven positive NFP surprises in the previous 17 releases, excluding data for March 2021. On average, the deviation was -0.93 on disappointing prints and 0.47 on strong figures. 15 minutes after the release, gold moved up by $3.87 on average if the NFP reading fell short of market consensus. On the flip side, gold gained $0.03 on average on positive surprises. This finding suggests that investors’ immediate reaction is likely to be more significant to a disappointing print. However, the correlation coefficients we calculated for the different time frames mentioned above don’t even come close to being significant. The strongest negative correlation is seen 15 minutes after the releases with the r standing at -0.4. One hour after the release, the correlation weakens with the r rising to -0.23 and there is virtually no correlation to speak of four hours after the release with the r approaching 0. Several factors could be coming into play to weaken gold’s correlation with NFP surprises. Several hours after the NFP release on Friday, investors could look to book their profits toward the London fix, causing gold to reverse its direction after the initial reaction. Additionally, US Treasury bond yields’ movements have been impacting gold’s action lately and a decline in the benchmark 10-year T-bond yield on an upbeat jobs report could make it difficult for the USD to gather strength against its rivals, limiting XAU/USD’s downside.

Gold Price Forecast: XAU/USD spikes and retreats, drops to fresh multi-week low post-NFP

FXStreet News 07.01.2022 15:56

Gold languished near a two-week low amid a goodish rebound in the equity markets.Subdued USD price action extended some support to the dollar-denominated metal.Investors also seemed reluctant to place aggressive bets ahead of the US NFP report.Update: Gold faded an early North American bullish spike and dropped to a fresh three-week low, around the $1.785 region in reaction to mixed US jobs report. The headline NFP showed that the economy added 199K new jobs in December, missing estimates for a reading of 400K. The disappointment, however, was offset by an upward revision of the previous month’s reading to 249K from 210K. Adding to this, the unemployment rate fell to 3.9%, beating expectations for a modest downtick to 4.1% from 4.2% previous, reaffirming expectations for an eventual Fed lift-off in March.This was evident from elevated US Treasury bond yields, which, in turn, continued acting as a headwind for the non-yielding yellow metal. That said, modest US dollar weakness continued lending some support to the dollar-denominated gold. This, along with the cautious mood around the equity markets, helped limit the downside for the safe-haven XAU/USD. Nevertheless, spot prices remain on track to post the biggest weekly decline since late November.Previous update: Gold remained depressed for the third successive day on Friday and was last seen hovering near a two-week low, just below the $1,790 level during the early European session. A slight improvement in global risk sentiment – as depicted by a generally positive tone around the equity markets – acted as a headwind for the safe-haven XAU/USD. Apart from this, the Fed's hawkish outlook was seen as another factor that undermined the non-yielding yellow metal. It is worth recalling that the minutes of the December FOMC meeting released on Wednesday showed that some policymakers want to tighten monetary policy faster to combat stubbornly high inflation.The markets were quick to react and are now anticipating a roughly 80% chance for an eventual lift-off in March, which was further reinforced by the overnight comments by Fed officials. St. Louis Fed President James Bullard said that the Fed could raise rates as soon as March and is now in a good position to take more aggressive steps to control inflation. Separately, San Francisco Fed President Mary Daly too supported the prospects for an early rate hike. This comes on the back of a shift from Minneapolis Fed President Neel Kashkari, expecting two rate hikes this year as against his long-held view that the Fed should hold off on rate hikes until 2024.This, in turn, pushed the US 2-year notes, which are sensitive to rate hike expectations along with 5-year notes, to a near two-year high. Moreover, the yield on the benchmark 10-year US government bond shot to levels not seen since March 2021. Investors, however, preferred to wait and see if the US jobs data (NFP), due later during the early North American session, would reinforce the need for higher interest rates. This, in turn, kept US dollar bulls on the defensive and extended some support to the dollar-denominated gold. Nevertheless, the commodity, at current levels, remains on track to post the biggest weekly decline since late November.Technical outlookFrom a technical perspective, this week’s rejection near the $1,830-32 supply zone and the subsequent downfall might have already shifted the bias in favour of bearish traders. Some follow-through selling below the $1,785 horizontal support will reaffirm the negative outlook and set the stage for a further near-term depreciating move. Gold might then accelerate the downward trajectory towards the $1,770-69 intermediate support en-route to the December 2021 swing low, around the $1,753 region.On the flip side, the $1,800 mark, coinciding with a technically significant 200-day SMA, now seems to act as immediate strong resistance. Sustained strength beyond might trigger a short-covering move and push gold prices towards the $1,815 hurdle. Some follow-through buying should allow bulls to aim back to challenge a strong barrier near the $1,830-32 region.Gold daily chartTechnical levels to watchXAU/USDOVERVIEWToday last price1787.89Today Daily Change-0.29Today Daily Change %-0.02Today daily open1788.18 TRENDSDaily SMA201799.96Daily SMA501804.8Daily SMA1001792.88Daily SMA2001800.52 LEVELSPrevious Daily High1811.62Previous Daily Low1786.47Previous Weekly High1830.39Previous Weekly Low1789.51Previous Monthly High1830.39Previous Monthly Low1753.01Daily Fibonacci 38.2%1796.08Daily Fibonacci 61.8%1802.01Daily Pivot Point S11779.23Daily Pivot Point S21770.27Daily Pivot Point S31754.08Daily Pivot Point R11804.38Daily Pivot Point R21820.57Daily Pivot Point R31829.53

Shiba Inu price could surge 30% if SHIB can overcome this hurdle [Video]

FXStreet News 07.01.2022 15:56

Shiba Inu price bounces off the daily demand zone, extending from $0.0000269 to $0.0000293.Increased buying pressure could propel SHIB by 31% to sweep the range high at $0.0000399.A four-hour candlestick close below $0.0000269 will create a lower low, invalidating the bullish thesis.Shiba Inu price is at an interesting point in its journey since it has produced two areas of liquidity in the opposite direction. Adding to this exciting development is one hurdle that blocks the path for SHIB and might hinder the bullish outlook.Shiba Inu price prepares for a rallyShiba Inu price set up two swing lows at $0.0000283 on December 20, 2021, and January 5, creating the double bottom setup. Interestingly, this setup took place inside the daily demand zone, extending from $0.0000269 to $0.0000293.While SHIB has recovered above this area, it needs to rally 12% before it faces the trading range’s midpoint at $0.0000341. Clearing this barrier will lead the meme coin to face $0.0000349, which harbors the buy-stop liquidity resting above it. Shiba Inu price needs to clear $0.0000349 before it can reach the range high at $0.0000399, completing its 31% ascent.SHIB/USDT 4-hour chartDepicting the importance of the hurdle at $0.0000349 is IntoTheBlock’s Global In/Out of the Money (GIOM) model. This on-chain metric shows that roughly 110,570 addresses that purchased 82,785 billion SHIB tokens at an average price of $0.0000350 are underwater.Therefore, Shiba Inu price needs to flip this barrier to reduce the selling pressure from holders trying to break even.Beyond this area, the resistance barriers thin out until $0.0000680, supporting the bullish outlook detailed above.SHIB GIOMFurther indicating the oversold nature of Shiba Inu price is the Market Value to Realized Value (MVRV) model. This on-chain metric is used to determine the average profit/loss of investors that purchased SHIB over the past month.Currently, 30-day MVRV is hovering at -11.53%, an opportunity zone, suggesting that SHIB holders are at a loss and are less likely to sell their tokens. Moreover, long-term holders tend to accumulate in this area, which could serve as a significant source of buying pressure and could be the reason to kick-start an uptrend.SHIB MVRVWhile things are looking up for Shiba Inu price, a four-hour candlestick close below the daily demand zone’s lower limit at $0.0000269 will create a lower low, invalidating the bullish thesis. This development could trigger a crash, knocking Shiba Inu price to retest the $0.0000237 support level.

Financial Sector Starts To Rally Towards The $43.60 Upside Target

Chris Vermeulen 07.01.2022 22:13

Near November 24, 2021, I published a research article suggesting the Financial Sector, XLF in particular, may bottom and start to move higher, targeting the $43.60 level. After watching XLF rotate lower and form multiple bottoms near $37.50, it appears to finally be starting a new breakout rally phase ahead of Q4:2021 earnings. Will it rally up to my $43.60 target level before the end of January 2022? And how far could it rally beyond my $43.60 target?Using a simple Fibonacci Price Extension allowed me to target the $43.60 level. Duplicating that range and applying it to the top of the $43.60 target level will enable me to see a higher target range of $49.55. This upper target level would result from a 200% Fibonacci price rally from the original price range I identified back in late November 2021.Could it happen? Sure, it could happen. Financials are uniquely positioned to benefit from higher consumer engagement in almost all levels of the economy. Housing, consumer spending, credit/loan origination, fees and services, trading, and other services – they all combine into Banking and Financial Services. I expect Q4:2021 to show robust consumer engagement and housing data, likely prompting many financial firms' strong revenues/earnings results.My original financial sector (xlf) research article included (below) for you to review:The recent downward price rotation in the Financial Sector (XLF) may have frightened some traders, but my research suggests this move is setting up a future bullish price target near $43.60 – a more than +11% move. The end of the year Christmas Rally phase of the markets should drive spending and Q4:2021 expectations strongly into the first quarter of 2022. Unless something big breaks this market trend, traders should continue to expect a “melt-up” bullish price trend through at least early January 2022.Sign up for my free trading newsletter so you don’t miss the next opportunity!The Financial Sector continues to deliver strong earnings and revenue data each quarter. The way consumers and assets prices have reacted after the COVID market collapse says quite a bit about the ability of financial firms to generate future profits. Financial firms actively engage in financial services, traditional banking, real estate, and other investments, and corporate financing. The rising inflation trends and consumer spending activities suggest the US economy is still rallying after the COVID stimulus and recovery.Financials May Rally 10% to 15%, or more, by January 2022My analysis of XLF suggests this recent pullback in price may stall and start a new bullish price rally targeting the $43.60 level – a full 100% Fibonacci Price Extension of the last rally in XLF.This Daily XLF chart shows the extended rally in early 2021 and the brief pause in the price rally between June 2021 and early September 2021. Now that we've entered Q4:2021 and the US economy appears to be strengthening in the post-COVID recovery, my expectations are that most sectors, and the US major indexes, will rally throughout the end of 2021 and into early 2022.This recent pullback in XLF sets up a solid buying opportunity for traders targeting a +10% rally that may last well into January/February 2022 – or longer.Longer-term Financial Trends Suggest Another Rally Above $44 May Start SoonOver the past 6+ months, moderate rally phases in XLF have shown a range of about $4.00 to $4.50. I've highlighted two recent rally phases in XLF on this longer-term XLF Daily chart below with gold rectangles. I believe the next rally from the recent pullback will be similar in size and prompt a moderate upward price move targeting the $43.60 level – or higher.Although there are some concerns related to the continuing recovery in the US markets, I believe the momentum of the US recovery and the strength in the US Dollar will push many US sectors higher over the next 60+ days. Closing out Q4:2021 and starting Q1:2022 with a fairly strong rally that may surprise many traders.The Financial sector is likely to present very strong Q4:2021 revenues and earnings data as long as the global markets don't push some crisis event or other issue that could detract from the US economic recovery. Right now, the biggest issues seem to be China and Europe.Concluding thoughtsMy opinion is that any moderate price weakness in the Financial sector will be short-lived and will resolve into a bullish price rally, or "melt-upward" type of trend, as we move into early December 2021. Once the US Debt Ceiling issue is resolved, I believe the Financial sector will begin a very strong rally pushing prices above $44 or $45 as Q4:2021 earnings expectations drive investors' focus into Technology, Consumer Retail, Financials, and Real Estate.The strength of the US Dollar is driving large amounts of capital into US assets and stocks right now. Based on my research, it is very likely that the US major indexes and certain sectors will continue to rally into early January 2022. If my analysis proves accurate, we may see a +11% to +18% rally in XLF before the end of January.If you are interested in learning more about how my strategies can help you protect and grow your wealth in any type of market condition, I invite you to visit www.TheTechnicalTraders.com

Will 2022~23 Require A Different Strategy For Traders/Investors? Part III

Chris Vermeulen 08.01.2022 13:50

Is The Lazy-Bull Strategy Worth Considering? - Part IIIThis last part of our multi-part article compares trading styles amidst the increasing price volatility and extended hyperbolic trending. We'll explore what we've witnessed in the US markets over the past 5+ years and highlight what to expect throughout 2022. Additionally, we'll highlight and feature the strategic advantages of our advanced Lazy-Bull strategies.Lazy-Bull Rides Big Trends & Avoids Excessive RisksMany people are inherently opposed to the Lazy-Bull strategy because they've been conditioned to think trading requires actively seeking various opportunities every week. We don't quite see it that way. Instead, we see the opportunity for growth and consistency existing in taking 4 to 12+ strategic trades per year while the markets set up broad momentum moves/trends. Our objective is not to trade excessively just for the sake of trading. Instead, we want to take advantage of when the markets enter opportunistic periods of trending and ride those trends as far as they go.Sign up for my free trading newsletter so you don’t miss the next opportunity!This example Weekly SPY chart showing our TTI trading strategy highlights the growth phases in various trend stages. Notice the GREEN and RED sections on this chart where our system has identified directional changes in the major price trends. Over the past 11+ years, there have been numerous bullish price trend phases resulting in 12 months to 36+ months bullish price trend trends. These major price cycles make up part of the advantage of the Lazy-Bull strategy.We are not actively seeking the strongest stock symbols throughout these trends. Instead, we are simply relying on the strength of the US major indexes to carry our trades further into profits as the market's trend. The TTI strategy is a "set it – and forget it" type of strategy until the strategy generates a new entry or exit trigger.Volatility & Price Rotation Make 2022 More Dangerous Than 2021 – What Next?Our research shows 2022 will likely continue to exhibit increased price volatility and bigger price rotation. Meaning 2022 could be very dangerous for shorter-term strategy traders as volatility levels may disrupt traditional stop boundaries or other aspects of their defined strategies.It is important to understand how and when these issues creep into a strategy and attempt to move above these issues.Looking at the Q1 through Q4 data using our proprietary Data mining utility, I'll give you my insight related to the data and what I believe is likely to happen in 2022. Remember, this data consolidated the past 28-29 years of trends in the SPY to present these results – going back to 1993. That means that this data is compiled through several various price trends, major market peaks, major market bottoms, and various volatility levels along the way.Q:2022 AnalysisQ1 data suggests an overall positive/upward price trend is likely in 2022, with the Total Monthly Sum across 29 years totaling 37.94. Broken into annual gains, that translates into an expected $1.30 gain in the SPY in Q1:2022.The Total Monthly NEG (negative) range appears to be more than double the Total Monthly POS (positive) range. However, we may see some price volatility in Q1:2022 that surprises the markets. For example, maybe the US Fed makes surprise rate increases? Perhaps it relates to some other foreign market event disrupting the US markets? I don't know what it will be, but I feel some market event in Q1 is likely, and this event may prompt a fairly large downward price rotation in the SPY.Overall, I believe Q1:2022 will end slightly higher than the end of Q4:2021 levels and may see the SPY attempt to break above $490~500 on stronger earnings and continue the market's bullish price phase.Q2:2022 AnalysisThe second quarter seems a bit more stable in overall price appreciation trends. The data shows a shallow NEG value compared to a moderately strong POS value for Q2. Because of this, I believe the second quarter of 2022 will slide into a relatively strong upward Melt-Up type of trend after a potentially volatile Q1:2022.The Total Monthly Sum value is higher in Q2 than in Q1, suggesting Q2 may exhibit a stronger upward momentum as a more apparent trend direction sets up after the Q1 volatility.The US Fed will likely attempt to aggressively reduce its balance sheet throughout Q2 and into Q3:2022 if my expectations are accurate. This may create some additional market volatility in Q2 and Q3:2022 – but I suspect the US Fed will attempt to conduct a lot of this activity relatively quietly – almost behind the market strength/trends.Q3:2022 AnalysisQ3 shows data that is somewhat similar to Q1 overall. I interpret this data as showing moderate bullish trend strength within the typical mid-Summer US market stagnation in trend. Mid-Summer trends tend to be a bit more sideways in nature. Many traders are vacationing, enjoying the Summer weather, and/or not paying attention to market trends and dynamics. Because of this, I expect the July through September months of 2022 to be relatively quiet and mundane.Additionally, we have the mid-term US elections set up in November 2022. The July through September months will be packed with political posturing, campaigning, and various events filled with antics to distract the markets from focusing on real issues. As a result, election years tend to be somewhat quiet – especially in the 2 to 5 months leading up to the actual election date.The end of Q3:2022 and the start of Q4:2022 could see some bigger, more aggressive price trending. The elections, ramping up of the early holiday/Christmas seasons, and the end of Summer may prompt traders to move into undervalued assets or other opportunist trades seeking to ride out an end-of-year trend. Right now may be a great time to identify strong swing/position trades to close out 2022 with some nice profits.Q4:2022 AnalysisQ4:2022 shows a very strong bullish trend potential, with the POS results greatly surpassing the NEG results. Historically, this is because of the traditional Santa Rally phase of the US markets and may play a big role in 2022 if the US economy stays strong throughout 2022.Overall, I expect the US Fed to act in a manner that supports the "transitioning" of the global markets away from excessive risks while attempting to nudge inflationary trends lower. There is talk that the US Fed may take aggressive action to combat inflation, but I see the Fed's actions are more subtle than brutal at this stage.I believe the US Federal Reserve is keenly aware of the fragility of the global markets after many years of excessive easy-money policies. In my opinion, the current market environment is more similar to the late 1960s and 1970s than the 1990s and early 2000 time frame. We've seen a massive influx of capital in the global markets – push all traditional economic metrics "off the charts" after the COVID event. That capital will work itself throughout the global economy, disrupting more at-risk companies and nations' capabilities, but still prompt a moderate growth component for many years to come.Volatility, Trading, And Profiting From Bigger TrendsThe entire point was to discuss the opportunities of moving above the current excessive price volatility and adopting a trading strategy that is more suited to bigger, broader market price trends. In 2019, I warned that 2020 was likely to be very volatile.In February 2021, I warned that 2021 was likely to be very volatile for certain market sectors: WILL 2021 PROMPT A BIG ROTATION IN SECTOR TRENDS? – PART IIIn early January 2020, I warned the US markets may be set up for a "Waterfall Selloff": ARE WE SETTING UP FOR A WATERFALL SELLOFF?Today, I'm suggesting that price volatility will likely peak sometime in 2022 or 2023 and begin to subside as the excesses of the past 8+ years continue to process through what I'm calling the "transitioning phase" of the markets. This market phase is more of a deleveraging and revaluation phase which started in February 2020 – in various sectors. It has now extended into many global economies where excess risk factors are being addressed and revalued (think China, Asia, and other areas).This transitioning process will likely continue in 2022 and 2023, meaning traders need to be prepared for the increased price volatility and adopt a style of trading that will allow them to profit from these bigger trends. This is why I'm suggesting taking a higher-level approach to trade over the next 24 to 36+ months.Certain market trends will still allow traders to pick up some fantastic profits as sectors and various undervalued symbols gain momentum. Overall, though, I feel that 2022 and 2023 will be moderately difficult for shorter-term trading strategies and that a higher-level, longer-term approach may be a much more beneficial approach.Want To Learn More About My Long-Term Investing Strategy?My Technical Investor strategy is uniquely suited toward this type of trading style. It is simple, longer-term, and rises above the moderate price volatility that disrupts many shorter-term trading strategies.Get ready; 2022 will be an excellent year for traders with big trends and bigger volatility. We have to stay ahead of these trends to protect our capital and allow it to grow more efficiently. The risks of more traditionally moderate volatility systems getting chewed up in this extreme environment will continue. So be prepared to move towards a more protective trading style to survive the next 12 to 24 months.If you are interested in learning more about how my Technical Investor (and other trading strategies) can help you protect and grow your wealth in any type of market condition, I invite you to visit www.TheTechnicalTraders.com

Miners Should Prepare a Pillow: Gold's Hard Landing Can Hurt

Przemysław Radomski 07.01.2022 15:54

As in sports, a weak market streak can reverse in the next season. However, the precious metals team looks like it’s about to drop out of the league. While gold, silver, and mining stocks were in the holiday spirit during the final weeks of 2021, I warned on Jan. 4 that the GDXJ ETF’s sleigh was headed for an epic crash. I wrote: The GDXJ ETF’s corrective upswing has likely run its course. Interestingly, the junior miners’ current rally mirrors the small correction that materialized in mid-2021 (early August). Back then, the GDXJ ETF rallied on low volume and didn’t recapture its 50-day moving average. With the same tepid strength present today, the drawdown that followed in mid-2021 will likely commence once again. On top of that, the behavior of the GDXJ ETF’s RSI is also similar – with the indicator moving from roughly 30 to 50. For context, I highlighted the similarities with green and purple ellipses below. Also noteworthy, similar developments occurred in February/March 2020, before the profound plunge unfolded. As a result, the GDXJ ETF looks set for another sharp drawdown over the medium term. After the junior mining stocks ETF proceeded to decline by more than 6% in two days, my short position rang in the New Year with solid gains. What’s more, with the GDXJ ETF likely to break below its 2021 lows over the medium term, winter woes should materialize before a long-term buying opportunity emerges. Please see below: Likewise, with the GDX ETF’s RSI (Relative Strength Index) signaling an ominous outcome for the senior miners, I warned that a sell-off was likely on the horizon. For context, I highlighted the historical similarities with the blue vertical dashed lines below. Moreover, with the GDX ETF’s weakness accelerating on Jan. 5/6, the senior miners have declined sharply in recent days. In addition, the current price action mirrors the senior miners’ ominous performance in July/August 2021 – just like I’ve been describing it for a few weeks now. As a result, the previous corrective upswing is likely over, and the GDX ETF should confront lower lows sooner rather than later. For context, a breakdown below the 2021 lows should materialize over the medium term, and the forecast for gold, as well as gold stocks, is bearish for the next several weeks / months. However, the milestone may not occur over the next few days. Turning to the HUI Index’s long-term chart, the same bearish signals are present. For example, I marked the specific tops with red and black arrows. In the current situation, we saw yet another small move up, but that’s most likely because the price moves are now less volatile. The areas marked with red ellipses remain similar and show back-and-forth movement before the big decline. As such, while we’ve entered a consolidation phase, this week’s selling pressure has been quite ferocious. Thus, the implications are not bullish but bearish. Finally, the GDX/GDXJ ratio continues to perform as expected. For example, I warned throughout 2021 that the ratio was destined for devaluation. ith the metric kicking off 2022 with another decline, the GDXJ ETF continues to underperform the GDX ETF. For context, I believe that gold, silver, and the GDX ETF are all ripe for sharp re-ratings over the medium term. However, I think that the GDXJ ETF offers the best risk-reward ratio due to its propensity to materially underperform during bear markets. As a result, shorting junior miners offers a great risk to reward trade-off. In conclusion, gold, silver, and mining stocks began 2022 with the same weakness that plagued them in 2021. While the worst performers one year often become the best performers the next, the charts signal more weakness ahead. As a result, while the precious metals are poised to soar over the long term, lower lows will likely materialize before their secular uptrends resume. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Fed Hawks Grow Stronger. Will Gold Stand Its Ground?

Arkadiusz Sieron 06.01.2022 16:43

2022 may be the year of Fed hawks. After tapering, they may hike rates and then start quantitative tightening. Will they tear gold apart? During the Battle of the Black Gate in the War of the Ring, Pippin : “The eagles are coming!”. It was a sign of hope for all those fighting with Sauron. Now, I could exclaim that hawks are coming, but that wouldn’t necessarily give hope to anyone fighting the bearish trends in the gold market. Yesterday (January 5, 2022), the FOMC published the minutes from its last meeting, held in mid-December. Although the publication doesn’t reveal any revolutions in US monetary policy, it strengthens the hawkish rhetoric of the Fed. Why? First, the FOMC participants acknowledged that inflation readings had been higher, more persistent, and widespread than previously anticipated. For instance, they pointed to the fact that the trimmed mean PCE inflation rate, which trims the most extreme readings and is calculated by the Dallas Fed, had reached 2.81% in November 2021, the highest level since mid-1992, as the chart below shows. It indicates that inflation is not limited to a few categories but has a broad-based character. The Committee members also noted several factors that could support strong inflationary pressure this year. They mentioned rising housing costs and rents, more widespread wage growth driven by labor shortages, and more prolonged global supply-side frictions, which could be exacerbated by the emergence of the Omicron variant; as well as easier passing on higher costs of labor and material to customers. In particular, supply chain bottlenecks and labor shortages could likely last longer and be more widespread than previously thought, which could limit businesses’ ability to address strong demand. Second, the FOMC admitted that the US labor market could be tighter than previously thought. They judged that it could reach maximum employment very soon, or that it had largely achieved it, as indicated by near-record rates of quits and job vacancies, labor shortages, and an acceleration in wage growth: Many participants judged that, if the current pace of improvement continued, labor markets would fast approach maximum employment. Several participants remarked that they viewed labor market conditions as already largely consistent with maximum employment. The consequence of higher inflation and a tighter labor market would be, of course, a more hawkish monetary policy. Although the central bankers didn’t discuss the appropriate number of interest rate hikes, they agreed that they should raise the federal funds rate sooner or faster: Participants generally noted that, given their individual outlooks for the economy, the labor market, and inflation, it may become warranted to increase the federal funds rate sooner or at a faster pace than participants had earlier anticipated. Additionally, Fed officials also discussed quantitative tightening. They generally agreed that – given fast economic growth, a strong labor market, high inflation, and bigger Fed assets – the balance sheet runoff should start closer to the policy rate liftoff and be faster than in the previous normalization episode: Almost all participants agreed that it would likely be appropriate to initiate balance sheet runoff at some point after the first increase in the target range for the federal funds rate. However, participants judged that the appropriate timing of balance sheet runoff would likely be closer to that of policy rate liftoff than in the Committee's previous experience. They noted that current conditions included a stronger economic outlook, higher inflation, and a larger balance sheet and thus could warrant a potentially faster pace of policy rate normalization. Implications for Gold What do the recent FOMC minutes imply for the gold market? Well, referring once more to the Lord of the Rings, they are more like the Nazgûl that wreak despair rather than the Eagles offering hope. They were hawkish – and, thus, negative for gold prices. The minutes revealed that after tapering of quantitative easing, the Fed could also reduce its overall asset holdings to curb high inflation. In December, the US central bank accelerated the pace of tapering and signaled three interest rate increases in 2022. The minutes went even further, signaling a possibility of an earlier and faster rate hike and outright reduction in the Fed’s balance sheet: Some participants also noted that it could be appropriate to begin to reduce the size of the Federal Reserve's balance sheet relatively soon after beginning to raise the federal funds rate. Some participants judged that a less accommodative future stance of policy would likely be warranted and that the Committee should convey a strong commitment to address elevated inflation pressures. Hence, the price of gold responded accordingly to the FOMC minutes and declined from about $1,825 to $1,810, as the chart below shows. Luckily, there is a silver lining: the drop hasn’t been too big, at least so far. It may indicate that a lot of hawkish news has already been priced into gold, and that sentiment is rather bullish. However, the hawks haven’t probably said the last word yet. Please remember that the composition of the Committee will be more hawkish this year, but also that the mindset is changing among the members. For example, Minneapolis Fed President Neel Kashkari, one of the Committee’s most dovish members, said this week that the U.S. central bank would have to need to raise interest rates two times this year. Previously, he believed that the federal funds rate could stay at zero until at least 2024. Thus, although inflationary risk may provide support for gold, the yellow metal may find itself under hawkish fire in the upcoming weeks. We will see whether it will stand its ground, like the soldiers of Gondor. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Gold: No Cheer in the New Year

Przemysław Radomski 06.01.2022 12:22

What a way to start a year! Gold just faked its comeback before moving to new yearly lows. That’s a very bearish way for a market to start the year. Given that miners underperformed gold and silver briefly outperformed it, we have a very bearish storm brewing for the next couple of weeks / months. On Jan 3, I wrote the following: The year 2021 is over, 2022 has finally arrived. However, why does the current price action look “sooo last year”? Because the patterns appear to be repeating and the clearest similarity is present in the key precious metal – gold itself. Gold prices moved higher in late December, and it happened on low volume. The rally caused the stochastic indicator to move above 80 and the RSI above 50. That’s exactly what happened in both: late 2021 and late 2020. What does it mean? Well, it means that we shouldn’t trust this rally, as it could end abruptly, just like the one that we saw a year ago. Besides, gold corrected 61.8% of the preceding decline (so it moved to its most classic Fibonacci retracement), which means that – technically – what we saw in the past two weeks was just a correction, not the beginning of a new rally. And what happened next? Gold declined, faked its comeback, and then declined again to new yearly lows. 2022 continues to be a down year for gold, and this is particularly revealing, because early January is the time when the buy-backs should – theoretically – happen. I’m referring to the tendency for investors to exit losing positions (and – in tune with my expectations and against expectations of almost everyone else – 2021 was a down year for gold, silver, and mining stocks, after all) close to the end of the year, in order to harvest the tax loss, and then to get back into the market in early January. Despite the above tendency, gold is down, silver is down, and mining stocks are down as well. This shows that the precious metals market is weak (which has been clear since gold invalidated its breakout above the 2011 high in 2020) and is unlikely to soar significantly (in terms of hundreds of dollars) unless it slides first. Besides, at the beginning of major rallies, gold stocks tend to lead the way up. And right now, it’s exactly the opposite. The upper part of the above chart features the GDXJ ETF – proxy for junior mining stocks, the middle part features the GLD ETF – proxy for gold, and the bottom part features the S&P 500 Index. The red lines compare the previous stock market highs to what happened in junior miners, and the dotted lines show what juniors did when gold formed its recent highs and lows. In short, junior gold mining stocks are underperforming both: gold, and other stocks. This is as bearish as it can get, given the current situation regarding the USD Index (which is in a medium-term uptrend) and the situation in the interest rates, which are not only about to go up, but the expectations of them going up are becoming more and more hawkish. And that’s no accident either, as it’s in tune with the current political narrative in the U.S. – inflation is currently presented as the major enemy that needs to be dealt with. In other words, as the situation in interest rates is likely to become even more hawkish and the USD Index is likely to move higher, gold is likely to go down, and so – eventually – will the general stock market. And since junior mining stocks have already proven over and over again that they magnify declines on both markets, they are likely to fall particularly hard, when the above markets decline. We gained quite a lot based on the decline in the juniors in 2021, but it seems that the gains that could be reaped in 2022 (of course, I can’t and I’m not promising any kind of specific performance for any market) based on junior miners’ decline (and then their revival) could be breathtaking – but as always, only if one is positioned correctly for both major moves. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

S&P 500 probably doesn't attract investors, gold and silver recovering?

Monica Kingsley 10.01.2022 12:33

S&P 500 indecisiveness Thursday gave way to another down day, and it doesn‘t look to be over in the least. Tech still isn‘t catching breadth enough – and that was my key condition of declaring a reprieve in the selling, if not a turnaround. Likewise credit markets don‘t offer optimistic signs – it‘s still risk-off there, and the sharp rise in yields is putting inordinate pressure on many a tech stock. True, the behemoths aren‘t that much affected, but even a glance at semiconductors tells you that the rot is running deeper than apparent from $NYFANG. This is part of the flight from growth into value, which we will see more of in 2022. The same for still unpleasantly high inflation which won‘t be tamed by the hawkish Fed – not even if they really allow notes and bonds to mature without reinvesting the proceeds already in Mar. The train has left the station more than 6 or 9 months ago when they were pushing the transitory thesis I had been disputing. We have truly moved into the persistently high inflation paradigm, and it would be accompanied by wage inflation and strong precious metals and commodities runs. We‘re looking at very good year in gold and silver while the turbulence in stocks is just starting, and we have quite a few percent more to go on the downside. Oil and copper are set up for great gains too. This will be a year when monetary and fiscal policy work at odds, when they contradict each other. Inflation would catch up with the economic growth in that inflation-induced economic slowdown would be a 2022 surprise. Signs of real estate softening would also appear – it‘s all about housing starts. While rates would rise (2.00% in 10-year Treasury is perfectly achievable), it won‘t catch up with inflation in the least – hello some more negative rates, and financial repression driving real assets. Rhymes perfectly with the 1970s. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook No real floor has materialized in either S&P 500 or tech. Volume didn‘t rise, the buyers aren‘t yet interested – we have to get at more oversold levels. Credit Markets HYG didn‘t build on Thursday‘s advance one iota, and still looks to me melting down. While the 10-year closed at 1.76%, we aren‘t looking at such sharp bond ETF downswings – and the degree in which tech reacts next, would be telling. Gold, Silver and Miners Gold and silver staged an orderly recovery, still tiptoeing around the hawkish Fed, whose tightening cycle would turn out shorter than they think. And sniffing that out, would be the turning point in the metals. Crude Oil Crude oil bulls took a daily pause, but expect it to be short-lived. We‘re looking at triple digit oil not too many months away. Copper Copper pared back Thursday‘s setback, and definitely isn‘t overheated. The sideways consolidation that would be resolved to the upside, continues – the bears are fighting a losing battle. Bitcoin and Ethereum Bitcoin and Ethereum continue trading on a weak note, and the sellers are likely to return soon. This certainly doesn‘t look like a good time to buy. Summary S&P 500 still hasn‘t turned, and I‘m looking for more weakness – tech continues leading to the downside, and bond reprieve hasn‘t yet arrived. Anyway, it‘s questionable how fast tech would react – value can‘t keep S&P 500 afloat by itself. The realization of the hawkish Fed is here as much as the jobs data not standing in their tightening plans (wage pressures are here as quite a lot of vacancies remains unfilled – hello, full employment) – and assets are reacting. As I have stated in the 2nd and 3rd paragraphs of today‘s big picture analysis (investors would appreciate thoroughly), we‘re in for a challenging year in stocks, a great one in precious metals and most commodities – and definitely in for turbulence arriving, pulled over into 1H 2022 courtesy of the Fed. Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.

Would they sell S&P 500 (SPX)?

Monica Kingsley 11.01.2022 15:41

S&P 500 reversed sharp intraday losses, and credit markets moved in a decisive daily risk-on fashion. Turnarounds anywhere you look – HYG, TLT, XLK… but will that last? VIX having closed where it opened, points to still some unfinished job on the upside, meaning the bears would return shortly – but given how fast they gave up the great run yesterday, I‘m not looking for them to make too much progress too soon. Good to have taken yesterday‘s short profits off the table. Assessing the charts, it‘s great (for the bulls) that tech liked the long-dated Treasuries reversal to such a degree – and that value closed little changed on the day (its candle is certainly ominously looking). As a result, we‘re looking at a budding reversal that can still go both ways, and revisit 4,650s in the bearish case at least. Remember that tech apart from $NYFANG lagged, and financials aren‘t yet broken either, meaning that the credit market upswing better be taken with a pinch of salt. True, rates have risen fast since the New Year, and the pace of yield increases has to moderate. I‘m of the opinion that yesterday‘s good Nasdaq showing hasn‘t yet turned tech bullish, and that we still face a move lower ahead. As written yesterday: (…) This is part of the flight from growth into value, which we will see more of in 2022. The same for still unpleasantly high inflation which won‘t be tamed by the hawkish Fed – not even if they really allow notes and bonds to mature without reinvesting the proceeds already in Mar. The train has left the station more than 6 or 9 months ago when they were pushing the transitory thesis I had been disputing. We have truly moved into the persistently high inflation paradigm, and it would be accompanied by wage inflation and strong precious metals and commodities runs. We‘re looking at very good year in gold and silver while the turbulence in stocks is just starting, and we have quite a few percent more to go on the downside. Oil and copper are set up for great gains too. This will be a year when monetary and fiscal policy work at odds, when they contradict each other. Inflation would catch up with the economic growth in that inflation-induced economic slowdown would be a 2022 surprise. Signs of real estate softening would also appear – it‘s all about housing starts. While rates would rise (2.00% in 10-year Treasury is perfectly achievable), it won‘t catch up with inflation in the least – hello some more negative rates, and financial repression driving real assets. Rhymes perfectly with the 1970s. Stocks aren‘t yet out of the woods, the yesterday opened oil position is already profitable, cryptos likewise maintain a gainful slant to the Sunday-opened short – meanwhile, precious metals are once again catching breadth to rise, and the same goes for copper. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook The bid arrived, and the bottom may or may not be in – in spite of the beautiful lower knot, I‘m leaning towards the hypothesis that there would be another selling wave. Credit Markets HYG reversal looks certainly more credible than the S&P 500 one. LQD though didn‘t rise, which is a little surprising – on the other hand though, that‘s part of the risk-on posture, which would have been made clearer by LQD upswing. Gold, Silver and Miners Gold and silver position is improving, and I like the miners coming alive. The stage is set for upswing continuation till we break out of the very long consolidation. Crude Oil Crude oil looks to have declined as much as it could in the short run – I‘m looking for another run to take out $80 – see how little ground oil stocks lost? Copper Copper didn‘t outshine, didn‘t disappoint – its long sideways move continues, the red metal remains well bid, and would play catch up to the other commodities – the bears aren‘t likely to enjoy much success over the coming months. Bitcoin and Ethereum Just as I wrote yesterday, Bitcoin and Ethereum continue trading on a weak note, and the sellers are likely to return soon. This certainly doesn‘t look like a good time to buy. Summary S&P 500 turnaround has a question mark on it – one that I‘m more inclined to think would lead to further selling than a run above 4,720. The tech and bonds progress would be challenged again – we‘re still way too early in the Fed tightening cycle when the headwinds are only becoming to be appreciated. The room for negative surprises and kneejerk reactions is still there (the job market isn‘t standing really in the Fed‘s way), and it would likely take stocks (and cryptos) down while being less of an issue for real assets – be it commodities or precious metals. Wage pressures and unfilled vacancies are likely to last, meaning the inflation would be persistent – the staglationary era coupled with inflation-induced economic slowdown surprise I mentioned yesterday, awaits. Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.

Gold - Fed moves are likely to reveal the shape of the future

Arkadiusz Sieron 11.01.2022 15:10

Job creation disappointed in December. However, it could not be enough to counterweight rising real interest rates and save gold. On Thursday (January 6, 2022), I wrote that “the metal may find itself under hawk fire in the upcoming weeks”. Indeed, gold dropped sharply in the aftermath of the publication of the FOMC minutes. As the chart below shows, the hawkish Fed’s signal sent the price of the yellow metal from $1,826 to $1,789. This is because the minutes revealed that the Fed would be ready to cut its mammoth holdings of assets later this year. Previously, the US central bank was talking only about interest rate hikes and the ending of new asset purchases, i.e., quantitative easing. Now, the reverse process, i.e., quantitative tightening, is also on the table. What is surprising here is not the mere idea of shrinking the Fed’s assets – after all, they have risen to $8.7 trillion (see the chart above) – but its timing. Last time, the central bank started the normalization of its balance sheet only in 2018, nine years after the end of the Great Recession and four years after the completion of tapering. This time, QT may start within a few months after the end of tapering and the first interest rate hikes. It looks like 2022 will be a hot year for US monetary policy – and the gold market. Consequently, markets have been increasingly pricing in a more decisive Fed, which boosted bond yields. As the chart below shows, the long-term real interest rates (10-year TIPS) jumped from -1.06% at the end of 2021 to -0.73 at the end of last week. The upward move in the interest rates is fundamentally negative for gold prices. Implications for Gold Luckily for the yellow metal, nonfarm payrolls disappointed in December. Last month, the US labor market rose, adding just 199,000 jobs (see the chart below), well short of consensus estimates of 400,000. This negative surprise lifted gold prices slightly on Friday (January 7, 2021). The latest employment report suggests that labor shortages and the spread of the Omicron variant of coronavirus are holding back job creation and the overall economy. However, gold bulls shouldn’t count on weak job gains to trigger a sustainable rally in the precious metals. This is because the American economy is still approaching full employment. The unemployment rate declined further to 3.9% from 4.2% in November, as the chart below shows. The drop confirms that the US labor market is very tight, so weak job creation won’t discourage the Fed from hiking the federal funds rate. As a reminder, in December, FOMC members forecasted the unemployment rate to be 4.3% at the end of 2021. What is crucial here is that disappointing job gains reflect labor shortages rather than weak demand. Additionally, wage growth remains pretty fast, despite the decline in the annual rate from 5.1% in November to 4.7% in December. The key takeaway is that, despite disappointing job creation, the US economy is moving quickly towards full employment. The unemployment rate is at 3.9%, very close to the pre-pandemic low of 3.7%. Hence, the latest employment situation report may only reinforce arguments for the Fed’s tightening cycle. This is fundamentally bad news for gold, as strengthened expectations of the interest rate hikes may boost real interest rates further and put the yellow metal under downward pressure. Some analysts believe that hawkish sentiment might be at its peak. I’m not so sure about that. I believe that monetary hawks haven’t said the last word yet, and that the normalization of the interest rates is still ahead of us. Anyway, Powell will appear in the Senate today, so we should get more clues about the prospects for monetary policy and gold this year. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

We might say interest rates became Topic #1

Przemysław Radomski 11.01.2022 14:10

The imminent interest rate hike by the Fed is almost certain. Are investors' concerns justified and will it mean trouble for the precious metals? While the S&P 500 and the NASDAQ Composite recovered from sharp intraday losses on Jan. 10, investors’ mood swings signaled heightened anxiety. With the PMs whipsawing alongside the general stock market, more volatility should materialize in the weeks and months to come. To explain, with the Fed on a hawkish warpath to fight rampant inflation, JPMorgan CEO Jamie Dimon told CNBC on Jan. 10 that a resilient U.S. economy could prove problematic for the financial markets in 2022. “The consumer balance sheet has never been in better shape; they’re spending 25% more today than pre-COVID,” said Dimon. “Their debt-service ratio is better than it’s been since we’ve been keeping records for 50 years.” As for inflation and the Fed: “It’s possible that inflation is worse than they think and they raise rates more than people think. I personally would be surprised if it’s just four [interest rate] increases [in 2022],” he added. How would the financial markets react? Source: CNBC Singing a similar tune, the International Monetary Fund (IMF) warned on Jan. 10 that the Fed’s rate hike cycle could slaughter emerging markets. Its report revealed: “For most of last year, investors priced in a temporary rise in inflation in the United States given the unsteady economic recovery and a slow unravelling of supply bottlenecks. Now sentiment has shifted. Prices are rising at the fastest pace in almost four decades and the tight labor market has started to feed into wage increases.” Volatile Days Ahead While I warned for all of 2021 that inflationary pressures were bullish for the U.S. dollar and U.S. Treasury yields and bearish for the PMs, the IMF stated: “Faster Fed rate increases in response could rattle financial markets and tighten financial conditions globally. These developments could come with a slowing of US demand and trade and may lead to capital outflows and currency depreciation in emerging markets.” As a result, even the IMF is anxiously bullish on the USD Index: For a good reason. With September, July, June, and May all gone by the wayside, now, the market-implied probability of a Fed rate hike in March has risen to nearly 83%. For context, the probability of a March liftoff was less than 10% in early November. Please see below: Likewise, the market-implied probability of four rate hikes by the Fed in 2022 has risen to nearly 87%. Again, the probability was less than 50% in early November. Please see below: Why the material shift? Well, while I’ve been warning for months that rampant inflation would elicit a hawkish about-face from the Fed, investors are finally coming around to this reality. With inflation still running hot, market participants understand that pricing pressures won’t subside without policy responses from the Fed. As a result, the “transitory” narrative is dead, and investors have lost one of their staunchest allies. This means that predicting silver and gold at higher levels in the medium term might not be the best idea. To that point, Bank of America’s dove-hawk spectrum shows that the dovish brigade has lost several soldiers. With the hawks now on the offensive, the officials preaching monetary patience are few and far between. Please see below: For context, Bank of America still places San Francisco Fed President Mary Daly in the dovish bucket. However, I noted on Dec. 23 that she has materially shifted her stance in recent weeks: Source: The New York Times Furthermore, with inflationary pressures still bubbling, the Manheim Used Vehicle Value Index hit another all-time high of 236.2 in December, as “wholesale used vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) increased 1.6% month-over-month.” Please see below: On top of that, the cost of shipping from Shanghai, China, is still increasing. With the U.S. importing more goods from China than any other nation, the inflationary impact on the U.S. economy is material. Please see below: Finally, while the GDXJ ETF benefited from the NASDAQ Composite’s intraday reversal on Jan. 10, I warned on Oct. 26 that monetary policy tightening would eventually upend the junior miners. I wrote: To explain, the green line above tracks the GDXJ ETF from the beginning of 2013 to the end of 2015. If you analyze the left side of the chart, you can see that when Fed Chairman Ben Bernanke hinted at tapering on May 22, 2013, the GDXJ ETF declined by 32% from May 22 until the taper began on Dec. 18. Moreover, the onslaught didn’t end there. Once the taper officially began, the GDXJ ETF enjoyed a relief rally (similar to what we’re witnessing now), as long-term interest rates declined and the PMs assumed that the worst was in the rearview. However, as the liquidity drain caught up to the junior miners over the medium term, the GDXJ ETF declined by another 36% from when the taper was announced on Dec. 18, 2013 until the end of 2015. To that point, with part one already on the books, the second act will likely unfold once the Fed formally begins its taper in “either mid-November or mid-December.” Thus, history implies that the GDXJ ETF still has plenty of downside left. While the junior miners' ETF has declined by more than 11% since Oct. 26, Goldman Sachs has come around to our way of thinking. Please see below: To explain, Goldman Sachs told its clients last week that the yellow metal has been following its ominous path since 2013/2014 (as you may recall, I’ve been writing about the 2013-now analogy for months). For context, the red line above tracks gold’s price action from July 2010 until December 2014, while the blue line above tracks gold’s price action from July 2019 until now. If you analyze the symmetrical overlay, you can see that the pair have been in sync for some time. Moreover, if you focus your attention on the red line’s plight as time passes, it’s clear why Goldman Sachs is warning its clients about “further downside risk”. To that point, with the investment bank forecasting a real (inflation-adjusted) interest rate regime change in 2022, gold is poised to suffer along the way. To explain, the various bars above track gold’s monthly returns when the real U.S. Federal Funds Rate (dark blue), the real U.S. 5-Year Treasury yield (green), and the real U.S. 10-Year Treasury yield (light blue) begin with positive/negative values and then increase/decrease. If you focus your attention on the bars furthest to the right, you can see that when the real U.S. 5-Year Treasury yield and the real U.S. 10-Year Treasury yield are negative and then rise, gold suffers its worst monthly performances. Moreover, with the current fundamental environment presenting us with precisely that, similar results will likely materialize over the medium term. The bottom line? While investors desperately bought the dip on Jan. 10, the more than 2% intraday swing in the NASDAQ Composite screamed of monetary policy anxiety. With another hot inflation print poised to hit the wire on Jan. 12, the reprieve will likely be short-lived. Furthermore, with the PMs suffering from a similar fundamental affliction – as both the PMs and technology stocks are extremely allergic to rising interest rates – volatility is likely here to stay. As a result, the Fed should continue to break investors’ hearts over the medium term. In conclusion, the PMs rallied on Jan. 10, though their fundamental outlooks remain profoundly bearish. With interest rates poised to rise and the USD Index still undervalued, more headwinds should confront gold, silver, and mining stocks in the coming months. As a result, long-term buying opportunities are likely still a ways away. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

GOLD might be boosted with some factors

Alex Kuptsikevich 11.01.2022 09:56

An active reassessment of the outlook for monetary policy continues in the financial markets, but these changes have so far not moved gold from its position near $1800. The latest gold performance shows that it remains a portfolio diversification instrument, with little correlation to stock indices. Gold has gained for the third consecutive day, almost hitting the $1810 level. Last week the price came under pressure along with stocks, as US government bond yields rose as investors preferred them over precious metals paying no dividends or coupons. Gold also decreased intraday on Monday on a sharp fall in equities. However, buying on declines towards $1785 is well notable in gold. This is another jump around sustained buying. Previously, the areas of notable buying were $1760 in November and December and $1720 in August and September. Even earlier, in March 2021, gold got strong demand on dips to $1680. It is important to note that the higher support levels in gold at the end of last year occurred at the same time as the bond yields were rising, so the correlation between these assets is not direct. Historically, gold is vulnerable to rising long-term government bond yields only in case of a massive risk-off in the markets, which we witnessed in the epicentre of the last two global crises in 2008 right after the Lehman bankruptcy and in 2020 in the first weeks of the official pandemic. If the Fed and other central bankers manage to rein in inflation without causing major market turbulence during the policy normalization period, it could be a good springboard for gold. We have seen a similar example in the last tightening cycle. The first rate hike at the end of 2015 ended a corrective pullback in gold, becoming the starting point for a new six-month-long growth wave. Now the approach of a rate hike could draw attention to gold as a hedge against declines in growth stocks, which have a high sensitivity to interest rate movements. On the technical analysis side, if a new upside momentum in gold forms, it will lead the path to the $2500-2600 area after a 61.8% Fibonacci retracement from the August 2018 to August 2020 growth wave.

Gold Market in 2022: Fall and Revival?

Arkadiusz Sieron 07.01.2022 16:46

2021 will be remembered as the year of inflation’s comeback and gold’s dissatisfying reaction to it. Will gold improve its behavior in 2022? You thought that 2020 was a terrible year, but we would be back to normal in 2021? Well, we haven’t quite returned to normal. After all, the epidemic is not over, as new strains of coronavirus emerged and spread last year. Actually, in some aspects, 2021 was even worse than 2020. Two years ago, the pandemic was wreaking havoc. Last year, both the pandemic and inflation were raging. To the great surprise of mainstream economists fixated on aggregate demand, 2021 would be recorded in chronicles as the year of the supply factors revenge and the great return of inflation. For years, the pundits have talked about the death of inflation and mocked anyone who pointed to its risk. Well, he who laughs last, laughs best. However, it’s laughter through inflationary tears. Given the highest inflation rate since the Great Stagflation, gold prices must have grown a lot, right? Well, not exactly. As the chart below shows, 2021 wasn’t the best year for the yellow metal. Gold lost almost 5% over the last twelve months. Although I correctly predicted that “gold’s performance in 2021 could be worse than last year”, I expected less bearish behavior. What exactly happened? From a macroeconomic perspective, the economy recovered last year. As vaccination progressed, sanitary restrictions were lifted, and risk appetite returned to the market, which hit safe-haven assets such as gold. What’s more, a rebound in economic activity and rising inflation prompted the Fed to taper its quantitative easing and introduce more hawkish rhetoric, which pushed gold prices down. As always, there were both ups and downs in the gold market last year. Gold started 2021 with a bang, but began plunging quickly amid Democrats’ success in elections, the Fed more optimistic about the economy, and rising interest rates. The slide lasted until late March, when gold found its bottom of $1,684. This is because inflation started to accelerate at that point, while the Fed was downplaying rising price pressures, gibbering about “transitory inflation”. The rising worries about high inflation and the perspective of the US central bank staying behind the curve helped gold reach $1,900 once again in early June. However, the hawkish FOMC meeting and dot-plot that came later that month created another powerful bearish wave in the gold market that lasted until the end of September. Renewed inflationary worries and rising inflation expectations pushed gold to $1,865 in mid-November. However, the Fed announced a tapering of its asset purchases, calming markets once again and regaining investors’ trust in its ability to control inflation. As consequence, gold declined below $1,800 once again and stayed there by the end of the year. What can we learn from gold’s performance in 2021? First of all, gold is not a perfect inflation hedge, as the chart below shows. I mean here that, yes, gold is sensitive to rising inflation, but a hawkish Fed beats inflation in the gold market. Thus, inflation is positive for gold only if the US central bank stays behind the curve. However, when investors believe that either inflation is temporary or that the Fed will turn more hawkish in response to upward price pressure, gold runs away into the corner. Royal metal, huh? Second, never underestimate the power of the dark… I mean, the hawkish side of the Fed – or simply, don’t fight the Fed. It turned out that the prospects of a very gradual asset tapering and tightening cycle were enough to intimidate gold. Third, real interest rates remain the key driver for gold prices. As one can see in the chart below, gold plunged each time bond yields rallied, in particular in February 2021, but also in June or November. Hence, gold positively reacts to inflation as long as inflation translates into lower real interest rates. However, if other factors – such as expectations of a more hawkish Fed – come into play and outweigh inflation, gold suffers. Great, we already know that 2021 sucked and why. However, will 2022 be better for the gold market? Although I have great sympathy for the gold bulls, I don’t have good news for them. It seems that gold’s struggle will continue this year, at least in the first months of 2022, as the Fed’s hiking cycle and rising bond yields would create downward pressure on gold. However, when the US central bank starts raising the federal funds rate, gold may find its bottom, as it did in December 2015, and begin to rally again. Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care.

Fed and OPEC possibly affects Oil - WTI and Brent. Holidays in 2022 in times of COVID-19

Alex Kuptsikevich 12.01.2022 09:26

WTI crude oil surpassed the $80 mark in Tuesday's trading, near two-month highs and solidly above the 2018-2021 pivot levels near $75. Oil's fall in November-December by more than a quarter from a peak in late October probably served as a reset for oil. Interestingly, oil rose yesterday against plainly bearish news. The WHO warned of a sharp rise in omicron cases in coming weeks, and Oman's oil minister said OPEC+ did not want to see oil at $100 and overheat the market. However, traders were reading between the lines. The rapid spread of omicron is coming closer to the point of reaching collective immunity, raising the chances that summer travel and the holiday season will this time be much more pre-pandemic like. While initially causing some pressure on quotations, Oman's comments on oil did not present anything new in substance. As before, the cartel intends to stick to its plan to raise production by 400K per day every month. This is more than enough to shift the balance in the market towards surplus at the start of the year, but not enough to avoid causing excessive overheating of oil and provoking a new shale boom in the US and elsewhere. Producers in developed countries complain that banks are reluctant to finance new crude projects, requiring companies to become 'greener'. This raises the breakeven price of production projects, giving OPEC+ a head start. In addition, oil was probably positively impacted by Powell's confidence in the economic recovery, which is not threatened by either omicron or several rate hikes this year. Locally, investors interpreted this as confidence in a surge in oil demand in the coming months, which boosted the price. It will not be surprising if oil goes off to retest October highs near $85/bbl WTI and $87/bbl Brent in the next couple of weeks. If the demand for risky assets remains in place by then, we would expect a start of a rally towards $100 and an entrenchment in the $80-100 range through 2022. However, we cannot rule out that the speculative optimism in oil will fade as the Fed's tough stance on the economy is realised.

Oil influences FTSE 100 as it reaches 7611 GBP, USDJPY chasing 115.00

WTI is so near and yet so far. Fed and Oil, Oil and Fed.

FXStreet News 11.01.2022 16:04

WTI has pulled back from session highs above $80.00 as US equities come under selling pressure at the open. But oil may continue to fair better than equities, which are suffering from Fed hawkishness, if the demand outlook remains strong. Amid US equities coming under some selling pressure at the Tuesday equity open, front-month WTI futures have pulled back from earlier session highs to the north of the $80 per barrel level and are now trading back in the $79.00 area. That still leaves WTI prices up more than 50 cents on the day and the oil bulls will still be eyeing a test of last week’s highs in the $80.50 area. Indeed, oil strategists continue to view the spread of the Omicron variant as not likely to leave a meaningful dent in near-term oil demand. Meanwhile, despite the recent hawkish shift in market expectations for Fed tightening that has weighed on US and global equities, with four hikes now seen in 2022 coupled with quantitative tightening, the outlook for global growth in 2022 remains strong. This is what matters most for demand rather than financial condition-focused crude oil markets. The implication might be that, in the coming weeks/months, as long as Fed tightening isn’t seen as a “policy mistake” (i.e. that slows the economy unnecessarily), oil may remain a relatively safe risk asset even if Fed tightening expectations continue to weigh on equities. OPEC supply woes remain in the headline and could also be offering some support to the price action. Libya has faced further setbacks in its efforts to bring production back to 2021 peak output levels of roughly 1.3M barrel per day (BDP). The country’s National Oil Corporation (NOC) said on Tuesday that it would be suspending oil exports from its Es Sider terminal due to bad weather and lack of storage. As a result, it's Waha Oil Co. (which exports oil through the Es Sider terminal) would be reducing production by 50K BPD and this could rise to as much as as 105K BPD. Despite this, the NOC said that output was back to 896K BPD from the 729K BPD reported last week. Ahead, private US oil inventory data is scheduled for release at 2130GMT ahead of Wednesday official EIA US inventory report which is seen showing a seventh consecutive week of draws, with a further 2M barrel drop in stocks expected.

Real estate with a breath of fresh air

Finance Press Release 12.01.2022 14:30

PRESS RELEASE Warsaw, 11.01.2021 Commercial real estate market in Poland has come a long way since the spring of 2020. Never before have so many changes been made in such a short time. Adaptation to new conditions turned out to be the most difficult for hotels and retail. For the warehouse market, in turn, the reshuffling of sales and deliveries became a springboard for a series of records. The offices returned in a new form. Nowadays, the new trends that will shape the market in the upcoming years, lead the way for the real estate sector. Experts from Walter Herz consulting company comment on what is changing. Offices in demand - Despite the popularization of home office and the hybrid work system, we cannot speak of a revolution on the office market. The situation in the sector is quite stable. However, the way the space is used is changing. Tenants decide to extend contracts and change the arrangement of space, adapting it to the needs of employees in the new market environment. Some companies reduce space and maximize its use. Co-working is trending. Companies create more space for team work, integration and meetings - informs Mateusz Strzelecki, Partner / Head of Regional Markets at Walter Herz. Mateusz Strzelecki expects an explosion of relocation to flexible offices this year. - This tendency was already visible last year, but we expect an increase in the activity of companies this year. This is due to the fact that nowadays, tenants need more time to decide on the new office, even a year or a year and a half - admits Mateusz Strzelecki. Mateusz Strzelecki also points to a positive symptom visible on the market related to the return of foreign companies that have been actively looking for locations for their headquarters in our country since autumn last year. Strzelecki also speaks of the great boom seen on the flex space market segment. - Tenants now prefer shorter, flexible contracts with different options of space. Hence, the growing demand for instant offices and co-working spaces is growing. They offer a full range of services and short lease terms, which attracts tenants. They are most often complementary to traditional spaces. The resources of flexible space are growing rapidly and are already provided by the majority of the most modern facilities. In 2022, the potential of this segment will increase – predicts Mateusz Strzelecki. Frozen projects However, Mateusz Strzelecki no longer speaks of an increase in the resources of traditional office space on the market with such great optimism - The amount of space under construction, especially on the Warsaw market, is the lowest in a decade and there are no signs that this will change in the near future. The situation is better on the regional markets, while in Warsaw most of the large office investments have already been completed, and the remaining construction projects are nearly finished. Almost half of the space in the projects under construction already has tenants. Over time, the free space will shrink and the market offer will become smaller. There is a supply gap on the horizon in the next two years, as only a small number of projects is under implementation. Low supply with higher expected demand may translate into optimization of lease terms on the part of building owners, and even an increase in rental rates in the best buildings in central locations, which are currently the most popular. Increasingly higher utility prices will, in turn, affect the increase in service charges - notes Mateusz Strzelecki. - The growing construction costs related to high inflation and an increase in interest rates do not encourage investors to act. Prices for building materials, services, land and wages are rising. We can expect this trend to continue this year. Estimates show that the cost of delivering an office building to the market has increased by over 30 per cent, since the beginning of the pandemic. In addition, there are difficulties related to the timely delivery of materials - says Mateusz Strzelecki. Warehouse sector is hot BartÅ‚omiej Zagrodnik, Managing Partner/CEO of Walter Herz, points out that thanks to the large-scale office buildings that have been commissioned last year and which constitute attractive assets, this year's value of transactions on the investment market may reach the level seen in Poland before the pandemic. - In 2021, the transaction volume will probably be similar to the one recorded last year. The warehouse and industrial sector will account for almost a half of the total value. The demand for logistics real estate is breaking records not only on our market. In Poland, convenience-type facilities, retail parks and local daily service centers providing access to everyday goods are also gaining importance. Investors also appreciate more and more projects offering flats for institutional rental, student dormitories, retirement homes and nursing homes, which guarantee lasting capital security and an attractive level of return - informs BartÅ‚omiej Zagrodnik. - The pandemic has significantly boosted the development of the warehouse real estate market. A record amount of space is under construction all over the country. The historically high new supply is followed by an equally high demand, which was a third higher in the first three quarters of 2021 than in the corresponding period a year earlier. This is a trend that will continue also this year due to the further development of e-commerce and nearshoring, locating production closer to the outlet zone and striving to shorten the supply chain – explains BartÅ‚omiej Zagrodnik. New concepts BartÅ‚omiej Zagrodnik points out that more and more warehouses built in the new standard will enter the market. They will reach the height of 12 m. - Developers are also noticing great interest in last mile logistics facilities, located close to large urban agglomerations, and will implement more such projects. These types of facilities are particularly popular among distributors and delivery companies, which are associated with the boom in the e-commerce sector. This year, the dark store concept, which debuted on our market in 2021, will also be popularized in Poland. Networks of distribution microcenters, resembling shops, but created exclusively to handle online orders with express delivery in several minutes, will be expanded, which are already operating in the seven largest cities in the country – informs BartÅ‚omiej Zagrodnik. Walter Herz specialists agree that commercial investments in Poland have chosen the multiple functionality course. Among the projects prepared for construction, mixed-use complexes implemented in several stages predominate. The purpose of designing part of the investment is also to supplement the development with additional functions, as is the case with the office building in SÅ‚uÅ¼ewiec in Warsaw. - We could observe the implementation of investments with residential, commercial, service, entertainment and hotel functions in major cities in the country even before the pandemic. Now, such facilities have dominated the sphere of new investments. Projects built in line with sustainable development meet not only the expectations of today's investors, but also the needs of office users who appreciate the advantages of the local area even more, but expect a comprehensive offer - says Piotr SzymoÅ„ski, Director Office Agency at Walter Herz. - In Warsaw, the implementation of new, large-scale mixed-use investments is scheduled, among others, in the districts of Bielany and Å»eraÅ„. Complexes of this type will also be built in Kabaty and OkÄ™cie – says Piotr SzymoÅ„ski. More and more green - When outlining outstanding trends, it is impossible not to mention the ESG (Environmental, Social and Corporate Governance) standards, which are becoming an increasingly important criterion in assessing the value of commercial real estate. The building's efficiency, emissivity and the comfort it provides to its users, confirmed by certificates, have become a key issue for investors. The environmental aspect related to projects in the face of climate change is already as important as the financial profit and, in the context of EU directives, to a large extent influences business decisions. Sustainable investments achieve higher market valuations and are better rated by financial institutions - says Piotr SzymoÅ„ski. Piotr SzymoÅ„ski expects further, more and more detailed regulations on ESG. - We are observing an increasing desire to reduce operating costs and minimize the impact on the planet through the use of energy-saving solutions. Facilities that take into account the convenience of users are also more popular among tenants. Companies pay attention to how the space in which they work affects the natural environment. Some organizations only work with entities that represent similar standards in this field. Therefore, it can be expected that year to year there will be more "green" buildings on the market. We can also expect an increase in market competitiveness in this respect – adds Piotr SzymoÅ„ski. Aboout Walter Herz Walter Herz company is a leading Polish entity which has been operating in the commercial real estate sector across the country. For nine years, the company has been providing comprehensive and strategic investment consulting services for tenants, investors and real estate owners. It provides extensive support for both public and private sector. Walter Herz experts assist clients in finding and leasing space, and give advice when it comes to investment and hotel projects. In addition to its headquarters in Warsaw, the company operates in Cracow and the Tri-City. Walter Herz has created Tenant Academy, first project in the country, supporting and educating commercial real estate tenants across Poland, with on-site courses held in the largest cities in the country. In order to ensure the highest ethical level of services provided, the agency introduced the Code of Good Practice.

US Inflation Quick Analysis: Strong figures on all fronts cement Fed action, dollar set to bounce

FXStreet News 12.01.2022 15:58

The US reported a 7% in prices in 2021, as expected, triggering a dollar sell-off. Higher Core CPI at 5.5% supports a March rate hike from the Fed.The dollar could move higher once Fed officials respond to the data.The 40-year wait is over – inflation has hit 7%, the highest since 1982. That figure is what economists had expected, triggering a "buy the rumor, sell the fact" response. However, this headline inflation is set to cause a headache for President Joe Biden and Federal Reserve Chair Jerome Powell who has been recently renominated by the President. This political pressure will likely result in statements from Fed officials, about their determination to act. Several hawks have already come out in support of raising rates in March and also of an aggressive reduction to the Fed's balance sheet. It currently stands at nearly $8.8 trillion. However, Powell seemed calmer, focusing on a strong economy and refraining from promising imminent action. Can he stay silent after such a figure? His calm mood sent the dollar down on Tuesday and Wednesday's response to CPI is an extension of that move. Will the dollar continue lower? Powell will find himself under pressure to, at least, offer a tougher tone. Moreover, it is not only political pressure stemming from the headline, but also underlying prices that undermine the bank's calm.The Core Consumer Price Index (Core CPI) hit 5.5%, above 5.4% expected. On a monthly basis, this figure that excludes volatile food and energy costs rose by 0.6%, exceeding estimates as well. The Fed focuses on core prices, and would have to respond to curb inflation. Overall, while the "buy the rumor, sell the fact" response makes sense in the short term, the accumulation of inflationary data such as this report and strong wage growth – 4.7% in 2021 – point to more aggressive Fed action. That would turn the dollar back up, potentially reversing recent gains.

US Fed Playing With Fire - Bubbles May Burst While Bond Yields & Metals Rally

Chris Vermeulen 12.01.2022 16:59

The US Federal Reserve's tightening monetary policy from a historically low-interest rate has slowed the US stock markets. As a result, traders quickly attempt to adjust their capital allocation levels as risk assets, technology, and US major indexes roll lower because of expected Fed Rate Hikes and other Hawkish activities.We will explore how the US Fed's comments and potential future actions may prompt significant market trends in 2022 and beyond. We'll also attempt to identify how and when the US Fed may disrupt the US markets. We know the actions of the US Fed will prompt some significant trends over the next 12 to 24 months. We know certain assets will likely rise in value as fear settles into the markets because of rising interest rates and deflating asset bubbles. It is just a matter of understanding how the speculative asset bubble of the past 8+ years and how the US Fed may move to pop these speculative bubbles soon.Asset Bubbles Everywhere, The Global Markets Continue To FrothAsset bubbles, such as those created in Cryptos, the US stock market, US Real Estate, and the art/collectible market over the past 5+ years, have visualized the US Fed's easy money results in terms of bubbles.Take a look at this chart showing the growth in certain asset classes since the start of 2019. It is incredible to think that these asset classes have rallied so far and so fast in just over 35 months: The Grayscale Bitcoin ETF rallied more than 1200%. The Technology sector rallied more than 200%. Real Estate rallied more than 85%. The S&P 500 rallied more than 94%. The US Federal Reserve's move to lower interest rates after the 2018 market collapse, which resulted in a December 24, 2018, Christmas Bottom, prompted an incredible rally phase where traders followed the US Fed in piling into assets. As long as the US Fed continued buying assets and kept interest rates near zero, global traders had no reason to fight the US Fed.(Source: StockCharts.com)Is The US Fed About To Pop The Bubble From The Stratosphere?Our research suggests the US Federal Reserve is changing its policy a little late into the game. However, it appears the US and global markets have already "rolled over" in terms of growth trends and expectations. This SPY to QQQ ratio chart highlights that the US markets entered a peaking phase in late July/August 2020 and reached an ultimate peak in February 2021.(Source: TradingView.com)S&P 500 PE Ratio Suggests Investors Are ALL-IN For The Next 90+ YearsIn other words, it appears traders have reached their ceiling in terms of what they believe the US Fed is capable of doing at this stage in the rally. For example, the PE Ratio of the US Stock market ending in 2021 ended just below 30, with a historical high for 2021 near 37. The historical mean is 15.96 – which is still relatively high for the US stock market.Remember, a PE level of 15.96 means any investor buying in at those levels would need a minimum of 15.96 years of a company handing over "every penny of revenue" to the investor (excluding all costs, payrolls, taxes, fees, and other operating expenses) to cover the PE multiple of the investment. So a PE level of 30, as we see at the end of 2021, suggests that stock price valuation levels are at least 60 to 90+ years ahead of real returns.The only thing that can change this historic level of speculation in the markets is a deleveraging/revaluation event.(Source: multpl.com)From the US Fed's Actions To How Traders Should Prepare For Shifting MarketsThis first part of our ongoing research into the US Fed's actions and where they are telegraphing their intents will continue. Part II of this article will investigate how traders should read into these shifting markets and where we're attempting to highlight what has taken place over the past 3 to 5+ years.We've managed to live through an incredible event in history. I can only think of one other time when a global superpower extended this type of credit and support for the worldwide economy. That was the Roman Empire many thousands of years ago.What we experience over the next 20 to 40+ years could be the biggest and most incredible opportunity of your lifetime. The process of deleveraging all this debt and working all this capital through the global markets over the next few decades may present one of the most incredible investment/trading opportunities anyone has ever seen in over 1500 years.Look for my Part II to this article, and we'll continue exploring the current shifts in the US and global stock and asset markets.Finding The Right Strategies That Will Help You Navigate Through Bulls & BearsIf you have struggled with finding opportunities over the past year or so and want to know which are the hottest sectors, or how to protect and grow your capital, then please take a minute to review my Total ETF Portfolio - Triple-Strategy Trading Plan to help you profit from these big market transitions.Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may start a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to learn more about how my three Technical Trading Strategies can help you protect and grow your wealth in any type of market condition by clicking the following link: www.TheTechnicalTraders.com

We Will Probably Review All Of Inflation Indicators Around The World This Weekend

The USD Had a Slip-Up, but Gold Turned a Blind Eye to It

Przemysław Radomski 13.01.2022 15:22

“It’s my party and I’ll fall if I want to”, sang gold and kept its word. Although the dollar weakened, gold seemed reluctant to take advantage of it. Now that was a big decline in the USD Index! What made gold yawn and why is it declining today? Because it doesn’t want to rally. I’ve been writing this over and over again, and yet I’ll write it once more. Markets don’t move in a straight line up or down, and periodic corrections are natural. However, the way markets interact during those corrections tells us a lot about what’s likely to take place next, at least in the case of some markets. The USD Index declined quite visibly yesterday and in today’s overnight trading. The key questions are: so what, and if that was completely unexpected. Starting with the latter, it wasn’t unexpected. It’s something in tune with gold’s long-term chart. When the weekly RSI (based on the weekly price changes) for the USD Index hit 70, I wrote the following: Also, please note that the recent medium-term rally has been calmer than any major upswing witnessed over the last 20 years, where the USD Index’s RSI has hit 70. I marked the recent rally in the RSI with an orange rectangle, and I did the same with the second-least and third-least volatile of the medium-term upswings. The sharp rallies in 2008 and 2014 were of much larger magnitudes. And in those historical analogies, the USD Index continued its surge for some time without suffering any material corrections. As a result, the short-term outlook is more of a coin flip. Consequently, the current decline is not unexpected, it’s rather normal. I marked additional situations on the above chart with orange rectangles – these were the recent cases when the RSI based on the USD Index moved from very low levels to or above 70. In all three previous cases, there was some corrective downswing after the initial part of the decline, but once it was over – and the RSI declined somewhat – the big rally returned and the USD Index moved to new highs. I marked those declines in the RSI with blue rectangles, and I did the same thing for the current decline. As you can see, the size of the move lower is currently analogous to previous short-term corrections that were then followed by higher prices. This means that it’s quite likely over or very close to being over, and the medium-term rally can return any day now. Moving back to USD’s short-term chart, we see that the USD Index just (in overnight trading, so the move is not even close to being confirmed) moved a little below USDX’s rising support line based on the previous June and October 2021 lows. At the same time, the USDX is slightly below its late-2020 top and slightly above its November 2021 top. In light of the situation on the long-term USDX chart (as discussed above), this combination of support levels is likely to trigger a rebound and the continuation of the medium-term rally. At the beginning of 2021, I wrote that the year was likely to be bullish for the USD Index, and my forecast for gold (and the rest of the precious metals sector) was bullish – against that of almost every one of my colleagues. The USD Index ended 2021 about 6% higher, gold was down about 3.5%, silver was down almost 12%, the GDX ETF was down by about 9.5%, and the GDXJ ETF (proxy for junior mining stocks, my primary tool for shorting the precious metals sector in 2021 – I wasn’t shorting gold at any point in 2021) was down by about 21%. What about this year? It’s a tough call to say how the entire year will go, but it seems to me that the USD Index will move higher, and we’ll see both in the PMs: a massive decline, and then a huge rally. It’s very likely to be a year to remember for anyone interested in trading gold, silver, and/or mining stocks and/or investing in them. Let’s get back to the current situation. The USD Index declined to fresh 2022 lows – well below the previous January lows, and also below the December and late-November lows. How did gold respond? Gold rallied – but just by a mere $8.80. While gold got close to its early-January high, it didn’t manage to move above it. 2022 is still a down year for gold. Also, gold is clearly below its November 2021 highs, when it was trading close to $1,900. Is gold showing strength here? Absolutely not. Gold is showing the opposite of strength. It’s weak and unwilling to react to the USD’s weakness. That’s exactly what I want to see as a bearish indication if I plan on entering a short position in the precious metals sector or when I’m timing an exit of a long position, or as a confirmation of a bearish narrative in general. So, yes, of course I want to say that yesterday’s rally in gold was a bearish development. That’s the case, because gold should have rallied so much more, given what happened in the USD Index. Today’s overnight action makes the bearish case even clearer. The USDX is down a bit, but gold is down too, anyway. It simply doesn’t want to rally. Gold wants to decline instead. Mining stocks and silver behaved similarly to gold yesterday – they didn’t move to, let alone above, their previous 2022 highs. Consequently, they confirm the indications for the gold vs. USD dynamic – they don’t point to something else. Summing up, the outlook for silver, gold, and mining remains bearish for the medium term, and this week’s rally seems to be nothing more than a counter-trend breather. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Dandelion's Journey Is Now Live In GWENT! Love Event Starting Soon!

GameStop Stock Price and Forecast: Is this game over for GME stock?

FXStreet News 13.01.2022 15:56

GameStop stock continues to edge lower with little momentum. GME shares slide to $128, nearly 2% lower on Wednesday. GME stock is down 30% over the last three months and 13% this year. GameStop (GME) is reaching a key juncture. Now that the Fed has seemingly performed its magic act of raising rates and keeping markets happy, it is time to see if meme stocks can benefit from a more risk-on tone in equities. Meme stocks are all about momentum, not valuation, and there have been worrying signs for the last quarter. Small lot trades have been decreasing, and these are often used as an indicator of retail activity. Call option volumes have also decreased, another meme stock feature used widely by retail traders. Finally, the economy is nearly fully open, and the Omicron variant is milder. Will meme stocks ever recapture their preeminence of this time last year when they ruled the airwaves? GameStop (GME) was the number one topic on CNBC, and every other major financial news outlet. This year, so far, it barely warrants a mention. Momentum is worrying, and that is all meme stocks have to support them. GameStop (GME) stock news Today, January 13, marks the exact one-year anniversary of the first huge pop in the GME stock price. On January 13, 2021, GME stock spiked 57%, having been near 100% intraday, and set in motion the saga as we know it. That took GME shares from $20 to nearly $40 before closing back at $31.40. Many of us, myself included, thought this was madness when we took a close look at the company. Now if you got the chance to buy stock in GME at $40, you would jump at it. This is an example of how price alters the perception of value and why retailers have constant sales. Technically, the double top has been the problem here. GME put in a double top on November and December last year that has played out perfectly. The slide though has continued past the target. $118 is now key, and breaking below sees volume dry up and a likely move to $70. Breaking $160 to $167 is needed to change the view to a more bullish stance in our opinion. GameStop (GME) chart, daily

Next Rate Hikes In The USA Ahead. Update on Dollar Index (DXY)

Alex Kuptsikevich 13.01.2022 09:55

Fundamental and technical factors on the dollar locally give opposite signals. However, after a long period of strengthening the American currency, a corrective DXY pullback looks like a logical short-term prospect. On Wednesday, the US dollar came under pressure, the sharpest loss since last May and coming out of a prolonged consolidation. The dollar index retreated below 95 for the first time in two months. EURUSD surpassed 1.1400, trading at 1.1440 at the time of writing, having consolidated beyond the narrow range where the pair had spent the previous almost two months. Often such a decisive move out of the range is followed by a further breakout move, which we may well see in the coming days. The Dollar Index closed below the 50-day moving average on Tuesday and made a further move lower on Wednesday. The fall out of the range gave an informal start to the correction after the rally from May through most of November and the sideways movement in December. A potential target for such a pullback is seen in the 93.50-94.00 area. Near 94 is the 61.8% Fibonacci retracement of the dollar's move amplitude in 2021 and the starting point of the last rally in November. Near 93.50, the peak area of the index last year could be equally strong support. It hardly makes sense to say now that we are seeing the start of a big wave of dollar decline, as solid fundamentals support its growth. It looks like Fed members started a competition on whose expectations and comments are the most hawkish, and consumer inflation has given little reason to change the rhetoric. Among the latest comments is Powell's reassurance that the economy can cope with rate hikes. Fighting inflation is a top priority for the US central bank. Mary Daly, president of the Federal Reserve Bank of San Francisco, predicts a first rate hike as early as March. This practically rules out a pause between the end of balance buying and the first policy tightening. Furthermore, there are increasing signs that rate increases can continue to occur more frequently than once a quarter, as was the case in the previous tightening cycle. Many other central banks in developed countries are not yet prepared to tighten their policies as vigorously, which generally creates a sustained pull towards the USD on the interest rate differential in its favour.

US Federal Reserve - Playing With Fire Part II

Chris Vermeulen 14.01.2022 22:49

The US Federal Reserve has recently taken steps to communicate a change in future policy – suggesting raising interest rates and acting more aggressively to combat inflation. Throughout the last few weeks of 2021 and early 2022, these comments and posturing by the US Fed have created some very big downside price moves in the US major indexes. As a result, the US markets' volatility levels (VIX) have moved to a recent average between 17~21 – nearly 3x historical normal levels.US Fed Likely To Move Very Slowly On RatesOne thing that I believe has become evident to many people is that we have moved past the COVID stimulus conversations of the past 24+ months. Inflation, rising prices, constricted supply-chains, and an excess of capital throughout many global markets appear to have shifted how the US Fed interprets future risks. The Fed is telegraphing these concerns to investors very clearly right now, which means traders/investors are shifting their focus away from high-flying Growth stocks.Even though traders are attempting to shift capital away from certain risky sectors in the US and global markets, I still believe we have about 60 to 120+ days before the bigger market shift takes place.The US Federal Reserve will likely start addressing inflationary concerns by reducing their balance sheet assets – not by aggressively raising interest rates. I feel the US Fed will navigate Q1:2022 and Q2:2022 by reducing balance sheet assets while allowing the global supply-chain issues to attempt to resolve themselves. By June/July 2022, or later, I believe the Fed may start to consider rate increases as a means to slow inflation.Fed Comments Shift Investor Sentiment – Metals In Focus For Later 2022This move away from Dovish/easy-money policies will push traders to consider more traditional hedge investments – like Gold and Silver. I'm sure you've read some comments over the past 24+ months about Gold being an extremely undervalued asset as the US Fed poured trillions of stimulus dollars into the economy? These comments were made concerning the fact that Gold rallied from $1450 in 2019 to almost $2100 in 2020 – over 12 months (over +43%). Could a big move in Gold/Silver happen again in 2022 or 2023?My research suggests a Double Pennant/Flag formation in Gold suggests the $1675 support level becomes critical soon. It also indicates a Breakout/Breakdown move may start to happen before March or April 2022 – near the APEX of the current Pennant/Flag formation.Sign up for my free trading newsletter so you don’t miss the next opportunity! The key APEX range is currently between $1785 and $1830. This represents a very tight price range where Gold may attempt to consolidate as we move towards the March/April Apex. My research suggests a move to levels near $1740 to $1750 may happen just before the Apex Breakout/Breakdown initiates. So, watch for a bit of downside price volatility in Gold before the end of February 2022.Junior Gold Miners May Rally +45%, Or More, On A Gold Price RallyThe Junior Gold Miners (GDXJ) Weekly Chart shows a firm support level near $37.35 that should act as a floor for price. My research suggests the next 45+ days will see GDXJ prices stay below $44 to $45 – trading in a reasonably tight range before starting to rally higher near the end of February 2022.I believe Metals and Miners are aligning for a late February 2022 or Q2:2022 rally. The reason is that I believe the positioning by the US Fed, and expectations related to later 2022 (a mid-term election year), may prompt quite a bit of concern for the US and global equities. This will likely push investors and traders into “old-school” hedge instruments – like Gold and Silver.That means Junior Gold and Silver Miners maybe about 55+ days away from an explosive upside price trend.SILJ May Rally +70% to +100%, Or More, On Fed ActionsNear the end of 2022, I published a research article highlighting the incredible opportunity in Silver – focusing on how the Gold/Silver ratio had recently reached another peak level and had started to decline: Fear May Drive Silver More Than 60% Higher In 2022. This move suggests the disparity between the price of Gold to the price of Silver shows Gold is appreciated (and holding greater value) than Silver over the past few years.The COVID virus event, and the subsequent Fed/Government stimulus, shifted investors/traders focus away from precious metals and into the equities market speculative rally. Now that the US Fed is starting to warn of more aggressive rate increases and other actions, precious metals are suddenly much more important as a hedge against future risks.This SILJ Weekly Chart highlights the incredible base level, near $12, that continues to offer traders a fantastic hedge against a sudden Fed move. Using a simple Fibonacci Price Extension, we can see a $20 target level (+61%) and a $25.64 target level (100%). If the $12 level holds as a base/support, SILJ may be one of the easiest and best hedges against a sudden Fed move right now.The US Federal Reserve is, in my opinion, playing with fireThe COVID Virus Event pushed global debt levels higher by more than $19.5 Trillion Dollars (Source: Bloomberg ). The rush to attempt to save the global economy has created a massive surge in global debt levels – pushing the global debt to GDP level to well above 356% (Source: Axios).Why is this so important right now? Because the US Federal Reserve is talking about an attempt to move interest rates and Fed decision-making back to near-normal levels. In my opinion, this was the one fault of Alan Greenspan in 2006-07. The thought that we can raise rates to “near normal level” at any time when we have grown debt levels excessively throughout the world is failed thinking and ignorant, in my opinion.The US Federal Reserve is trapped and almost backed into a corner. I believe the US Fed will find any rate increases above 1.00 before the end of 2023 will significantly disrupt the global speculative bubble. Any attempt to move rates to levels near or above 2.00 would represent a nearly +2000% rate increase in less than 12 to 24 months. If you want to see a shock to the global markets where global debt to GDP is closing in on 400%, try raising the FFR by more than 2000% over a short period of time. That is what I call “playing with FIRE.”.(Source: Axios)2022 and 2023 will be filled with significant market trends and increased volatility. Right now, traders and investors need to understand the global markets are attempting to quickly transition away from a speculative/growth phase as the US Federal Reserve attempts to telegraph future rate increases. So it's time to start thinking about how to prepare for unknowns and how to protect your capital more efficiently.Growth sectors and US major indexes may continue to move higher for the next 30 to 60+ days, but my research suggests Q2:2022 may represent a "change in thinking" related to a late-2022 Fed shift. We are starting to see the markets move away from the speculative bubble-type trending we saw in 2020 and early 2021. Keep your eyes open and learn how to prepare for the big trends over the next 3+ years. The Fed is playing with fire right now. One wrong move and the markets could start a drastic price correction/reversion.Finding The Right Trading StrategiesIf you have struggled with finding opportunities over the past year or so and want to know which are the hottest sectors, or how to protect and grow your capital, then please take a minute to review my Total ETF Portfolio – Triple-Strategy Trading Plan to help you profit from these big market transitions.Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may start a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to learn more about how my three Technical Trading Strategies can help you protect and grow your wealth in any type of market condition by clicking the following link: www.TheTechnicalTraders.com

Gold Wars: Revenge of Supply and Inflation

Arkadiusz Sieron 14.01.2022 16:53

Inflation! The Republic is crumbling under attacks by the ruthless Supply Lord, Count Shortage. Dearness is everywhere. Will gold save the galaxy? If George Lucas were to make a movie about 2021 instead of Jedi knights, he would probably call it Revenge of the Supply. After all, last year will be remembered as the period of semiconductor shortages, production bottlenecks, disrupted value chains, delayed deliveries, surging job vacancies, rising inflation, and skyrocketing energy prices. It could be a shocking discovery for Keynesian economists, who focus on aggregate demand and believe that there is always slack in the economy, but it turned out that supply matters too! As a reminder, state governments couldn’t deal with the pandemic more smartly and introduced lockdowns. Then, it turned out – what a surprise! – that the shutdown of the economy, well, shut down the economy, so the Fed and the banking system boosted the money supply, while Congress passed a mammoth fiscal stimulus, including sending checks to just about every American. In other words, 2021 showed us that one cannot close and reopen the economy without any negative consequences, as the economy doesn’t simply return to the status quo. After the reopening of the economy, people started to spend all the money that was “printed” and given to them. Hence, demand increased sharply, and supply couldn’t keep up with the boosted spending. It turned out that economic problems are not always related to the demand side that has to be “stimulated”. We’ve also learned that there are supply constraints and that production and delivery don’t always go smoothly. The contemporary economy is truly global, complex, and interconnected – and the proper working of this mechanism depends on the adequate functioning of its zillion elements. Thus, shit happens from time to time. This is why it’s smart to have some gold as a portfolio insurance against tail risks. Evergiven, the ship that blocked the Suez Canal, disrupting international trade, was the perfect illustration. However, the importance of supply factors goes beyond logistics and is related to regulations, taxes, incentives, etc. Instead of calls for injecting liquidity during each crisis, efficiency, reducing the disincentives to work and invest, and unlocking the supply shackles imposed by the government should become the top economic priority. Another negative surprise for mainstream economists in 2021 was the revenge of inflation. For years, central bankers and analysts have dismissed the threat of inflation, considering it a phenomenon of the past. In the 1970s, the Fed was still learning how to conduct monetary policy. It made a few mistakes, but is much smarter today, so stagflation won’t repeat. Additionally, we live in a globalized economy with strong product competition and weak labor unions, so inflation won’t get out of control. Indeed, inflation was stubbornly low for years, despite all the easy monetary policy, and didn’t want to reach the Fed’s target of 2%, so the US central bank changed its regime to be more flexible and tolerant of inflation. It was in 2020, just one year before the outbreak of inflation. The Fed completely didn’t expect that – which shows the intellectual poverty of this institution – and called it “transitory”. Initially, inflation was supposed to be short-lived because of the “base effects”, then because of the “supply bottlenecks”. Only in November, the Fed admitted that inflation was more broad-based and would be more persistent than it previously thought. Well, better late than never! What does the revenge of supply and inflation imply for the gold market? One could expect that gold would perform better last year amid all the supply problems and a surge in inflation. We’ve learned that gold doesn’t always shine during inflationary times. The reason was that supply shortages didn’t translate into a full-blown economic crisis. On the contrary, they were caused by a strong rebound in demand; and they contributed mainly to higher inflation, which strengthened the Fed’s hawkish rhetoric and expectations of higher interest rates, creating downward pressure on gold prices. On the other hand, we could say as well that gold prices were supported by elevated inflation and didn’t drop more thanks to all the supply disruptions and inflationary threats. After all, during the economic expansion of 2011-2015 that followed the Great Recession, gold plunged about 45%, while between the 2020 peak and the end of 2021, the yellow metal lost only about 13%, as the chart below shows. Hence, the worst might be yet to come. I don’t expect a similarly deep decline as in the past, especially given that the Fed’s tightening cycle seems to be mostly priced in, but the real interest rates could normalize somewhat. Thus, I have bad news for the gold bulls. The supply crunch is expected to moderate in the second half of 2022, which would also ease inflationary pressure. To be clear, inflation won’t disappear, but it may reach a peak this year. The combination of improvement on the supply side of the economy, with inflation reaching its peak, and with a more hawkish Fed doesn’t bode well for gold. Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care.

Powell Sends a Smile to Gold

Arkadiusz Sieron 14.01.2022 16:27

Powell testified before the Senate. He didn’t say anything new, but gold rallied a bit. “We have totally screwed up inflation and now we are in deep trouble,” admitted Jerome Powell during his appearance before the Senate. OK, he didn’t formulate it exactly that way, but it was the message of his testimony. Powell admitted that the Fed wrongly expected a faster easing of supply disruptions and thought that price pressures would be much lower by now. As a consequence, inflation was believed to be only ‘transitory’. Unfortunately, that’s not what happened. “The supply-side constraints have been very durable. We are not seeing the kind of progress that all forecasters thought we’d be seeing by now. We did foresee a strong spike in demand. We didn’t know it would be so focused on goods,” saidPowell. As a result of the Fed’s inaction, inflation has risen 7% in 2021, the fastest pace since February 1982, as the chart below shows. After conducting very complicated calculations, Powell admitted that “inflation is running very far above target.” Bold deduction, Sherlock! Such high inflation is indeed a troublesome and even central bankers realize that. This is why Powell stated that “the economy no longer needs or wants the very accommodative policies we have had in place,” and that “we will use our tools to support the economy and a strong labor market and to prevent higher inflation from becoming entrenched.” However, there is a problem here. The main tool the Fed has to fight inflation is raising the federal funds rate, but hiking interest rates may hamper economic expansion and even trigger the next financial crisis. As Powell admitted, “if inflation does become too persistent, that will lead to much tighter monetary policy and that could lead to a recession.” Thus, the central bank is between a rock and a hard place, between high inflation and the risk of slowing economic expansion or even of an economic crisis. Implications for Gold What does Powell’s testimony imply for the gold market? Well, theoretically not much, as it didn’t include any major surprises. However, Powell sounded quite hawkish. For example, he downplayed the economic consequences of the current surge in coronavirus cases, and said that it’s likely not changing the Fed’s plans to tighten its monetary policy this year. These plans are relatively bold for this year: “We are going to end asset purchases in March. We will raise rates. And at some point this year will let the balance sheet runoff,” Powell said. However, it seems that Powell sounded less hawkish than investors were afraid of. Given such worries, the lack of any surprises could be dovish. This is at least what gold’s performance suggests. As the chart below shows, Powell’s testimony triggered a small rally and revived optimism in the gold market. That’s for sure encouraging. After all, gold jumped above a key level of $1,800, catching some breath, but it’s too early to call a major reversal in the gold market. The yellow metal would have to sustain itself above $1,820 and then surpass $1,850, or even higher levels, to trumpet a bullish breakout. There are still several headwinds for gold. First of all, the monetary hawks haven’t struck yet. They are growing in strength, as several regional bank presidents have recently called for a rate hike as soon as in March. Such calls may strengthen the expectations of rate increases, boosting bond yields, and creating downward pressure for gold prices. We’ll find out soon whether it will happen or not, as the January FOMC meeting is in two weeks, and it could be a groundbreaking event in the gold market. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

YUAN feels good even after not so optimistic stats

Alex Kuptsikevich 17.01.2022 12:33

China published mixed economic data noting a slowdown in a year-over-year comparison, but some of the data exceeded expectations. The Chinese renminbi has been on the offensive against the US dollar for the past week, bringing USDCNH back to test the lows of the past six months. The economy grew by 1.6% last quarter after 0.2% previously. However, the GDP growth was 4.0% y/y - the lowest since the second quarter of 2020. Industrial production added 4.3%, markedly better than the expected 3.7%. December retail sales data disappointed with growth slowing to just 1.7% y/y, the lowest since August 2020. Weakness in domestic demand data has not stopped the demand for the Chinese renminbi, which is testing the 6.35 mark for the second month. Since the beginning of December, the pair has bounced out of this area. Earlier in May 2021, we also witnessed a prolonged reversal near this level. The USDCNH traded steadily lower from January to May 2018 but turned to the upside at the start of the trade wars. The yuan has settled well, consolidating in a narrow range since late October, which has created the potential for a resumption of the trend. A firm consolidation below 6.35 at the end of the week or the month would be an essential signal for starting a new downward wave. However, we cannot rule out the possibility of another bounce from these levels for the time being.

(BTC) Bitcoin with a rise, (ETH) Ether gains as well, (XRP) Ripple probably doesn't feel that well today

FXStreet News 17.01.2022 15:56

Bitcoin price rejuvenates its uptrend as it bounces off a 4-hour demand zone, extending from $41,843 to $42,707. Ethereum price produces a higher high, signaling a continuation of its uptrend. Ripple price revisits the demand zone, ranging from $0.694 to $0.753, as bulls fail to kick-start a rally. Bitcoin price reveals a bullish outlook albeit a slow one, providing altcoins with an opportunity to run free. The past week is a testament to the recent gains witnessed among many altcoins. While Ethereum continues to remain bullish, Ripple struggles to hold on. Bitcoin price pushes forward Bitcoin price produced a lower low after the January 13 swing high at $44,439 but managed to set a higher low, keeping the uptrend somewhat intact. As BTC bounces off a 4-hour demand zone, extending from $41,843 to $42,707, investors can expect the pioneer crypto to make a run for the previous week’s high at $47,609. This hurdle is present below the 200-day Simple Moving Average (SMA) At $48,590. BTC’s upside potential, though, at least in the short-term, seems to be capped at the aforementioned level. BTC/USD 4-hour chart If Bitcoin price fails to see a bullish reaction off of the $41,843 to $42,707 demand zone, it will indicate weakness among buyers. This lack of interest could allow bears to take control and push BTC down to $41,762 – a four-hour candlestick close below there will then invalidate the bullish thesis. This development could lead Bitcoin price lower, to retest the $39,87 support level. Ethereum price shows strength Ethereum price is in a similar situation to Bitcoin as it produced a higher low but failed to set up a higher high. As long as BTC remains bullish, ETH will follow suit. Market participants can, therefore, expect the smart contract token to make a run for the 200-day SMA at $3,475. Clearing this hurdle will open the path for Ethereum price to revisit the daily supply zone, extending from $3,675 to $3,846. The upper limit of this hurdle coincides with the 50-day SMA, indicating that a further uptrend is unlikely. ETH/USD 4-hour chart Regardless of the optimistic scenario, Ethereum price needs to hold above the weekly support level at $3,061 to see a meaningful uptrend. A breakdown of this foothold will remove confidence and instill doubt among buyers. A four-hour candlestick close below the demand zone’s lower limit at $2,927, however, will create a lower low, invalidating the bullish thesis. Ethereum price finds stable support as ETH targets $4,000 Ripple price lacks motivation Ripple price has been teetering on a daily demand zone, stretching from $0.693 to $0.753 since the December 4, 2021 crash. One can assume that this barrier has been weakening. Due to its correlation with BTC, however, XRP price is likely to rally 12% to retest the 50-day SMA at $0.844. The weakened demand zone could face destruction by a short-term bearish momentum, however, so investors should exercise caution with the remittance token. In some cases, Ripple price could overcome the immediate hurdle and make a run for the 200-day SMA at $0.954. XRP/USD 1-day chart On the other hand, if Ripple price produces a daily candlestick close below $0.693, it will create a lower low, invalidating the bullish thesis. This development could trigger a crash, where XRP price could revisit the $0.604 support level. XRP price looks bullish, targets $1

Another One Bites the Dust

Monica Kingsley 20.01.2022 16:36

S&P 500 gave up opening gains that could have lasted longer – but the bear is still strong, and didn‘t pause even for a day or two. Defeated during the first hour, the sellers couldn‘t make much progress, and credit markets confirm the grim picture. There is a but, though – quality debt instruments turned higher, and maintained much of their intraday gains.And that could be a sign – in spite of the bearish onslaught driving the buyers back to the basement before the closing bell – that more buying would materialize to close this week, with consequences for S&P 500 as well. I would simply have preferred to see rising yields once again, that would be a great catalyst of further stock market selling. Now, the wisest course of action looks to be waiting for the upcoming upswing (one that didn‘t develop during the Asian session really), to get exhausted.Remember my yesterday‘s words:(…) The rising yields are all about betting on a really, really hawkish Fed – just how far are the calls for not 25, but 50bp hike this Mar? Inflation is still resilient (of course) but all it takes is some more hawkish statements that wouldn‘t venture out of the latest narrative line.Anyway, the markets aren‘t drinking the kool-aid – the yield curve continues flattening, which means the bets on Fed‘s misstep are on. True, the tightening moves have been quite finely telegraphed, but the markets didn‘t buy it, and were focused on the Santa Claus (liquidity-facilitated) rally instead – therefore, my Dec 20 warning is on. The clock to adding zero fresh liquidity, and potentially even not rolling over maturing securities (as early as Mar?) is ticking.And the run to commodities goes on, with $85 crude oil not even needing fresh conflict in Eastern Europe – the demand almost at pre-corona levels leaving supply and stockpiles in the dust, is fit for the job.With SPX short profits off the table, crude oil consolidating, and cryptos having second thoughts about the decline continuation, it‘s been precious metals that stole the spotlight yesterday – really great moves across the board to enjoy!Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 buyers are nowhere to be seen – what kind of reflexive rebound would we get next? The odds aren‘t arrayed for it to be reaching very high – yields are catching up even with financials...Credit MarketsHYG is likely to pause a little next, and the degree of its move relative to the quality debt instruments, would be telling. Rates are though going to keep rising, so keep looking for a temporary HYG stabilization only.Gold, Silver and MinersGold and silver keep catching fire, and are slowly breaking out of the unpleasantly long consolidation. The strongly bullish undertones are playing out nicely – these aren‘t yet the true celebrations.Crude OilCrude oil looks like it could pause a little here – the stellar run (by no means over yet) is attracting selling interest. The buyers are likely to pause for a moment over the next few days.CopperCopper is paring back on the missed opportunity to catch up – the red metal will be dragged higher alongside the other commodities, and isn‘t yet offering signs of true, outperforming strength.Bitcoin and EthereumBitcoin and Ethereum really are setting up a little breather, but I‘m not looking for bullish miracles to happen. Still, the buying interest was there yesterday, and that would influence the entry to the coming week (bullishly).SummaryS&P 500 upswing turned into a dead cat bounce pretty fast, and while we may see another attempt by the bulls, I think it would be rather short-lived. Think lasting a couple of days only. Not until there is a change in the credit markets, have the stock market bulls snowball‘s chance in hell. Commodities and especially precious metals, are well placed to keep reaping the rewards – just as I had written a week ago. For now, it‘s fun to be riding the short side in S&P 500 judiciously, and the time for another position opening, looks slowly but surely approaching. Let the great profits grow elsewhere in the meantime.Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.

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Russian Bear and Inflationary Hydra Sent Gold to $1,840

Arkadiusz Sieron 20.01.2022 17:24

Gold soared as investors got scared by reports of an allegedly impending military conflict. Was it worth reacting sharply to geopolitical factors? Gold has been performing quite nicely in January. As the chart below shows, its price increased from $1,806 at the end of December to around $1,820 this week, strengthening its position above $1,800. Yesterday (January 19, 2022), gold prices went sharply higher, jumping above $1,840, as one can see in the chart below. What happened? Investors got scared of the Russian bear and inflationary hydra. President Biden predicted that Russia would move into Ukraine. The threat of invasion and renewal of a conflict weakened risk appetite among investors. To complete the geopolitical picture, this week, North Korea fired missiles again (on Monday, the country conducted its fourth missile test of the year), while terrorists attacked the United Arab Emirates with drones. The heightened risk aversion could spur some demand for safe-haven assets such as gold. The yellow metal tends to benefit from greater uncertainty. However, investors should remember that geopolitical risks usually cause only a short-lived reaction. Investors also recalled the ongoing global inflationary crisis. Some news helped them wake up. In the U.K., inflation surged 5.4% in December, the highest since March 1992. Meanwhile, in Canada, inflation jumped 4.8%, also the fastest pace in 30 years. Additionally, crude oil prices have jumped to around $86.5 per barrel, the highest value since 2014, as the chart below shows. The timing couldn’t be worse, as inflation is already elevated, while higher oil implies higher CPI in the future. Gold should, therefore, welcome the rise in oil prices. On the other hand, it could prompt the Fed to react more forcefully and aggressively to tighten its monetary policy. Implications for Gold What does the recent mini-rally imply for the gold market? Well, it’s never a good idea to draw far-reaching conclusions from short-term moves, especially those caused by geopolitical factors. Risk-offs and risk-on sentiments come and go. However, let’s do justice to gold. It hit a two-months high, more and more boldly settling in above $1,800. All this happened despite rising bond yields. As the chart below shows, the long-term real interest rates have increased from about -1.0% at the end of 2021 to about -0.6%. Gold’s resilience in the face of rising interest rates is praiseworthy. Having said that, investors shouldn’t forget that 2022 will be a year of the Fed’s tightening cycle, rising interest rates, and also a certain moderation in inflation. All these factors could be important headwinds for gold this year. However, investors may underestimate how the Fed’s monetary policy will impact market conditions. After all, the Fed’s hawkish stance also entails some risks for the financial markets and the overall economy. Practically, each tightening cycle in the past has led to an economic crisis. As a reminder, after four hikes in 2018, the Fed had to reverse its stance and cut them in 2019. The Fed signaled not only a few hikes this year, but also a reduction of its balance sheet. Given the enormous indebtedness of the economy and Wall Street’s addiction to easy money, it might be too much to swallow. Importantly, when the Fed is focused on fighting inflation, its ability to help the markets will be limited. I thought that such worries would arise later this year, supporting gold, but maybe the gold market has already started to price in the possibility of economic turbulence triggered by the Fed’s tightening cycle. Anyway, next week, the FOMC will gather for the first time in 2022, and it could be an important, insightful event for the gold market. Stay tuned! If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Hotels increase their accommodation base

Finance Press Release 21.01.2022 11:08

PRESS RELEASE Warsaw, 17.01.2022 The growing interest in domestic tourism is conducive to the development of accommodation facilities in resorts. Interesting city hotels are also opening. The current year should bring stabilization in the hotel industry as more countries move from treating the covid as pandemic to endemic - Speaking of the current shape of the hotel sector, it is difficult to treat the market as a whole. Today we are dealing with two markets. The first of them - the city hotel market, considered safer before the pandemic, due to a more balanced structure of guests, as well as less seasonality than the second hotel market, that is tourist hotels. Currently, it is the latter market that is doing much better and is recovering from losses. City hotels, on the other hand, largely focus on maintaining the current profitability, however, in the fall, there was a recovery in demand from business guests and MICE. The results that the industry finished 2021 with are far from those before the market changes, but last year we could already see a recovery in demand and average prices on the market - says Katarzyna Tencza, Associate Director Investment & Hospitality at Walter Herz. Although there were fewer foreign guests, the hunger for travel and the uncertainty associated with overseas travel meant that in July and August last year, about 190 thousand more Poles stayed in hotels than in the summer of 2019. Demand accumulated in the summer as a result of, among others, the restrictions that hotels were subject to in the winter and spring months. The summer season in the resorts was very successful. The beginning of autumn in the resorts brought a sustained high demand for leisure and group stays. In November and December, the situation was clearly worse, with the exception of the holiday season, which was another opportunity for hotels in holiday destinations to increase revenues. - Good results obtained by resort facilities during the summer do not mean that the entire year 2021 can be considered successful by the industry. The turnover in the entire sector was lower than that achieved before the pandemic. The year 2022 should bring a continuation of the recovery in demand in the city markets - says Katarzyna Tencza. Ownership changes Despite the difficulties faced by hotels, so far we have not dealt with many transactions on our market. Especially that the largest market players mostly refrain from acquiring assets in this segment. The mass bankruptcies which were to happen in 2021, did not take place. Hotels for sale are not very attractive to investors due to location or other factors. The transactions took place mainly on regional markets. For example, NK Rysy company purchased Hotel Rysy, located in the very center of Zakopane. The unfinished Ewerdin hotel in Swinoujscie was also sold. In the second half of the year, a 100-room hotel located in the center of Cracow was also sold. We could also observe transactions concerning hotel facilities intended for other functions. Orbis has signed a preliminary agreement for the sale of the Ibis Hotel in Kielce, which is to be transformed into a different function facility. The deserted Astoria hotel in Klodzko was sold to a developer from Cracow, who after the renovation, will probably offer retail and service space. Polkomtel bought the Ossa hotel located in Ossa near Rawa Mazowiecka, in order to build a rehabilitation center. Polski Holding Hotelowy is also active on the market, which carries out the process of consolidation of facilities providing hotel services, owned by state-owned companies. PHH concluded a conditional agreement for the purchase of Geovita SA, part of the Polish Oil and Gas Mining Group, which manages several recreational facilities throughout Poland. The holding has also signed a conditional agreement with PGE Polska Grupa Energetyczna for the purchase of ten hotels and facilities belonging to Elbest, one of its companies that owns hotels, including in Krynica, MiÄ™dzyzdroje, Myczkowce nad Solina as well as facilities in Krasnobrod and Szklarska Poreba. Polski Holding Hotelowy has also signed conditional agreements for the purchase of a controlling stake in Interferie and shares in Interferie Medical SPA, companies belonging to the KGHM Group, thanks to which it will receive another six properties. New, high-class facilities in resorts In 2021, holiday resorts expanded their offer of high-quality hotel facilities. The recent openings are, of course, the result of investment processes initiated before the market turmoil. Tourist accommodation resources in the country increased, among others, thanks to the opening of the Radisson Resort hotel in Kolobrzeg with 209 rooms and an aquapark, the five-star Crystal Mountain hotel in WisÅ‚a with almost 500 rooms and an aquapark, and the 124-room Tremonti Ski&Bike Resort complex in Karpacz. Despite the difficulties, the hotel market continues to expand its resource base. New seaside hotel investments, as in previous years, are mostly located on the line between Swinoujscie and Kolobrzeg. Hotel investments in this region are mostly condo hotels. The largest projects include the Wave MiÄ™dzyzdroje Resort & SPA hotel with 393 suites, Aqua Resort in Miedzyzdroje with 300 rooms and an aquapark, 435-room Radisson Blu Resort in Miedzywodzie, Hotel GoÅ‚Ä™biewski in Pobierowo with approximately 1400 rooms, PINEA Resort & Apartments in Pobierowo with 138 apartments, 266-room Mövenpick in Kolobrzeg, Baltic Wave in Kolobrzeg which is to offer 468 suites. Polish mountains offer interesting hotel investments, also largely sold in the condo system, Among the most interesting projects are Elements Hotel & SPA in Swieradow Zdroj with 289 rooms, Sanssouci Karpacz MGallery Hotel Collection with 110 rooms, Movenpick in Karpacz with 126 rooms, Mövenpick Zakopane Imperial Hotel with 130 rooms, Infinity Zieleniec Ski & SPA in Duszniki Zdroj with 328 apartments, and Linden Hotel & Resort in Szklarska Poreba with 137 rooms. New city hotels - Hotel chains previously focused mainly on municipal investments, are now very active also in the holiday destinations. In addition, smaller regional cities are gaining in importance. Unfortunately, high prices of investment plots and fierce competition in the fight for land from investors developing apartments for rent and dormitories, as well as rising construction costs make it more and more difficult to budget for the new hotel projects. Banks are still very cautious about financing hotel investments - informs Katarzyna Tencza. The investment interest in the sector is mainly in tourist destinations, but urban locations can also offer visitors new, interesting facilities. Last year saw the opening of such facilities as the ibis Styles Kraków Centrum hotel with 259 rooms, NYX Hotel Warsaw of the Leonardo Hotels chain with 331 rooms, located in the Varso Place complex near the Warsaw Central Station, Tulip Residences Warsaw Targowa hotel with 110 units, and Mercure Katowice Centrum with 268 rooms. In addition, the 195-room Mercure Kraków Fabryczna City hotel appeared on the Cracow market, 300-room AC Hotel by Marriott Kraków and Courtyard by Marriott Szczecin City hotel was opened in the Posejdon complex in Szczecin. It offers134 rooms. In WrocÅ‚aw, guests were welcomed by the Jazz aparthotel with 62 rooms and Hotel Herbal with 66 rooms, and at the end of last year, Dwór Uphagena Arche Hotel GdaÅ„sk with 145 rooms was opened in Gdansk. The Olsztyn market welcomed the 105-room Hampton by Hilton Olsztyn hotel. This year, the city hotel market will be supplied with a dozen or so new facilities under the brands of international and Polish brands. Most of them are hotels for which investment decisions were made before the pandemic. The Warsaw market is to be supplied, among others, by 238-room Focus Hotel Premium Warszawa located in Mokotow, 192-room Staybridge Suites Warszawa Ursynów, 448-room Royal Tulip Warsaw Apartments in Unique Tower building on Grzybowska Street, 96-room Autograph Collection by Marriott International in Warsaw's Old Town, or 66-room Flaner Hotel WorldHotels Crafted Collection. In Cracow, a 216-room Hyatt Place Kraków hotel, 125-room Autograph Collection by Marriott International, 116-room Curio Collection by Hilton Hotel Saski Kraków, 53-room Garamond Boutique Hotel Tribute Portfolio, and 173-room Hampton by Hilton Krakow Airport hotel are to open next year. A 130-room B&B hotel is to welcome guests in Lublin, and a 122-room Hampton by Hilton BiaÅ‚ystok is to be commissioned in Bialystok. The 201-room Q Hotel Plus WrocÅ‚aw Bielany will open in Wroclaw and the former Sofitel Wroclaw Old Town hotel with 205 rooms will reopen under the Wyndham brand. More challenges The rapidly changing market conditions mean that the industry is facing new challenges. The greatest difficulties that hotels will have to grapple with in the near future are the rising costs of living and the lack of employees. Problems are also related to the recovery of demand from corporate guests, the MICE sector and foreign tourists. Rises in energy, gas and garbage disposal prices, and rising labor costs, are making it difficult for the sector to recover. Growing inflation driving the costs of maintaining facilities is forcing a rise in accommodation prices. We can expect an increase in accommodation prices in the upcoming months, both in holiday destinations and urban locations. About Walter Herz Walter Herz company is a leading Polish entity which has been operating in the commercial real estate sector across the country. For nine years, the company has been providing comprehensive and strategic investment consulting services for tenants, investors and real estate owners. It provides extensive support for both public and private sector. Walter Herz experts assist clients in finding and leasing space, and give advice when it comes to investment and hotel projects. In addition to its headquarters in Warsaw, the company operates in Cracow and the Tri-City. Walter Herz has created Tenant Academy, first project in the country, supporting and educating commercial real estate tenants across Poland, with on-site courses held in the largest cities in the country. In order to ensure the highest ethical level of services provided, the agency introduced the Code of Good Practice.

NASDAQ: NFLX Stock Price Decreased, Crypto Market Changed

Walid Koudmani 21.01.2022 12:35

Yesterday’s Q4 earnings report from Netflix was seen as a major disappointment with forecasts pointing to weaker subscriber growth amid rising competition, particularly when compared to the first part of 2021. While the company referred to increased competition as a major cause of this uncertainty, rising prices of plans may also be deterring some customers who now have access to a wide range of streaming services including Disney+ and HBO Max. The company’s stock dropped around 20% in after hours trading and could be set to begin today's trading in the $400 area - the lowest level since May 2020. Despite there being a general risk-off mood in markets, which has seen many other stocks also retreat, it remains to be seen if Netflix will manage to rebound or if it will continue heading lower. Crypto markets tank as risk-off moods dominate While it may appear that the crypto market has taken a big hit today, with the majority of top 100 coins down by around 10%, it is important to note that the general sentiment across markets is quite negative when relating to risk assets. This is in part due to the increasing prospects of fiscal and monetary policy changes from central banks, in particular the FED, which would remove a significant amount of liquidity from the market and that ultimately could lead to a significant fund reallocation. Furthermore, while we have seen major cryptos like Ethereum and Bitcoin drop below key levels like $3000 and $40,000, and reach the lowest level in several months they are both testing key support areas which previously preceded significant upward moves. While the global situation may be slightly different, it is worth keeping in mind that recent negative performance is not limited to the cryptocurrency market but is being seen across many different types of asset classes, albeit on a somewhat smaller scale. UK Retails sales decline and worry investors The 3,7% decline in retail sales illustrated by today’s report continues to indicate rising prices and economic uncertainty as some of the key reasons for the slowing down of sales. Despite Non-food stores sales falling noticeably in December, food store sales managed to only drop by 1% and retail sales as a whole were able to remain above pre pandemic levels. As the situation grows more uncertain and as inflation continues to be a key factor, it remains unclear whether central banks and governments will decide to take action or if they will wait and see if things improve naturally.

Can We Call It A Crypto Crash? Bitcoin Below $40k And Ether Below $3k

Alex Kuptsikevich 21.01.2022 09:44

The crypto market capitalisation fell to 1.83 trillion, losing 7.3% in the past 24 hours. As we had feared, the selloff was triggered by sharply negative sentiment in US equity markets and intensified by the breakdown of critical support levels. Bitcoin retreated to the $38.8K area. The amplitude of the decline from the peak at the start of the regular session in New York to the bottom at the opening of Asia exceeds 12%. Sellers have proven unbreakable (so far) the upper boundary of the downward price channel that has dominated bitcoin since mid-November. Another worrying fact is that Bitcoin's share has risen to 40.2% of the crypto's total cap. The implication is that investors are breaking out of altcoins even more sharply, as they are less confident in the ability of smaller coins to withstand the titans' fall. Without a sharp intraday reversal (chances for this are minimal), we can confidently expect an acceleration of long position liquidation in Bitcoin and further drawdowns. There is nowhere to look for support until the $30-33K area on the chart. Ether has given up support at $3K, quickly pulling back into the consolidation area of late September, ending up near $2.85K. The intensification of the selloff makes $2K the target of the initial downside wave. Earlier in 2021, the area of 30K for Bitcoin and near 2K for Ether was the bottom of a deep correction. This then attracted buyers, and the total market managed to rewrite highs. In that drawdown, the total capitalisation of cryptocurrencies was down to $1.2 trillion. If the first two cryptocurrencies were targeting lows last summer, it is logical to expect the entire market to return to the lows of that time. But then the external backdrop was highly favourable, as the US market was returning to growth with drawdowns in the 5% range, having already crossed that barrier earlier last year. The continued negative backdrop in equities sets up a deeper pullback in crypto. The crypto market's capitalisation could potentially shrink by half to the $830-900bn area before we see a new wave of long-term buyer inflows. For Bitcoin, this suggests the potential for a drop to 20k.

Iris Energy Secures 600MW Connection for Texas Bitcoin Mine

Coin Desk 21.01.2022 13:46

Australian crypto miner Iris Energy (IREN) secured a 600-megawatt connection for a new Texas crypto mining facility, the company said on Friday.The company said in a filing with the U.S. Securities and Exchange Commission (SEC) that it has executed a binding connection agreement with utility provider AEP Texas.Iris Energy paid $19 million for the security deposit and the connection fee, the filing said. The data centers in Texas are expected to be energized in the first quarter of 2023, the miner said.Iris Energy has secured a 300 acre freehold site in the Texas Panhandle, the state's northernmost region, which will be connected directly to the grid through a 345-kilovolt transmission line, the filing said.Iris Energy recorded a hashrate of 748 petahash per second (PH/s) in December 2021. It plans to add 2.9 exahash per second (EH/s) across two sites in British Columbia, with mining rigs it has already secured, by the end of 2022. Another 11.6 EH/s are planned for 2023, including 10.6 EH/s in the Panhandle facility.The company could add another 7 EH/s in the Texas facility if it secures more mining rigs, bringing its total computing power to 22 EH/s - almost 14% of the bitcoin network's current hashrate.Read more: Iris Energy’s December Hashrate Rises 14% as Revenue Falls Again

Gold Is the Belle of the Ball. Will Its Dance Turn Bearish?

Przemysław Radomski 21.01.2022 16:06

The precious metals still do pirouettes on the trading floor, but they can stumble in their choreography. The bears are just waiting for it. With the GDX ETF soaring on significant volume on Jan. 19, the senior miners had a renewed pep in their step. With gold, silver, and mining stocks all dancing to the same beat, the precious metals garnered all of the bullish attention. However, with the trio known to cut their performances short as soon as investors arrive, will the mood music remain so sanguine? Well, for one, the GDX ETF has a history of peaking when the crowd enters the party. For example, I marked with the blue vertical dashed lines and blue arrows below how large daily spikes in volume often coincide with short-term peaks. Moreover, with another ominous event unfolding on Jan. 19, historical data implies that we’re much closer to the top than the bottom. To explain, I wrote on Jan. 20: From the technical point of view, we just saw another day similar to the other days that I marked with vertical dashed lines and black arrows. Those days were either right at the tops or not far from them. As much as yesterday’s (7%!) rally looks bullish, taking a look at the situation from a broad perspective provides us with the opposite – bearish – implications. The zig-zag scenario is being realized as well. The GDX ETF moved to the upper border of the rising trend channel. Also, doesn’t it remind you of something? Hint: it happened at a similar time of the year. Yes, the current price/volume action is similar to what we saw in early 2021. The RSI was above 60, a short-term rally that was preceded by a bigger decline, and a strong daily rally on huge volume at the end of the corrective rally. We’ve seen it all now, and we saw it in early 2021. Please see below: What’s more, the senior miners’ fatigue is already present. For example, the GDX ETF declined by 1.40% on Jan. 20, and the index ended the session only $0.30 above its 2021 close. Likewise, the senior miners failed to rally above the upper trendline of their ascending channel (drawn with the blue lines above). As a result, the price action resembles an ABC zigzag pattern, and while the short-term outlook is less certain, the medium-term outlook is profoundly bearish. As further evidence, the HUI Index’s weekly chart provides some important clues. For example, despite the profound rally on Jan. 19, the index’s stochastic indicator still hasn’t recorded a buy signal. Moreover, the HUI Index dropped after reaching its 50-week moving average, and the ominous rejection mirrors 2013. Back then, the index approached its 50-week moving average, then suffered a pullback, and then suffered a monumental decline. As a result, is this time really different? Remember – history tends to rhyme, and this time the analogies from the past favor a bearish forecast for gold stocks. Turning to the GDXJ ETF, the junior miners were off to the races on Jan. 19. However, the size of the rally is actually smaller than what we witnessed in early 2021. Moreover, when the short-term sugar high ended back then, optimism turned to pessimism and the GDXJ ETF sank to new lows. Thus, with the junior miners’ 2021 story one of lower highs and lower lows, 2022 will likely result in more of the same. Please see below: Finally, the Gold Miners Bullish Percent Index ($BPGDM) isn’t at levels that trigger a major reversal. The Index is now at 30. However, far from a medium-term bottom, the latest reading is still more than 20 points above the 2016 and 2020 lows. Likewise, when the BPGDM hit 30 in 2013, the HUI Index was already in the midst of its medium-term downtrend (similar to what we witnessed in 2021). However, the milestone was far from the final low. With material weakness persisting and a lasting bottom not forming until the end of 2015/early 2016, further downside for gold (and silver) likely lies ahead. For context, it’s my belief that the precious metals will bottom when the BPGDM hits zero – and perhaps when it remains there for some time. In conclusion, gold, silver, and mining stocks put on quite a show on Jan. 19. However, with their bullish rhythm known to turn bearish in an instant, investors should proceed with caution. Moreover, the data shows that when investors rush to buy the precious metals, their over-enthusiasm results in medium-term weakness, not strength. As a result, the trio’s declines likely have more room to run before long-term buying opportunities emerge later in 2022. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Tech Stocks: (MSFT) Microsoft Stock, Facts About Microsoft

Dividend Power 24.01.2022 15:51

As stocks have trended higher, especially the tech stocks, soared in 2021, we must be reminded that Microsoft is once again one of the top companies in the world by market cap. Apple is number one in the world by market cap, and Microsoft continues to be right behind them. In October of 2021, Microsoft had bypassed Apple as the largest company by market cap globally, but Apple soon passed them once again. Microsoft is not the same old company we had known back when Bill Gates was in charge. They have changed and have created a more diverse brand and product portfolio leading that change. Bill Gates stepped down as CEO in 2000 and officially left his full-time role in Microsoft in 2008. Since then, Microsoft has diversified its portfolio to include many more products, including gaming, cloud services, and making Office more business-friendly. Microsoft under Gates was known for two big things: Microsoft Office and Windows; that was the entire portfolio. Satya Nadella, the current CEO of Microsoft, has revolutionized the software company and has made it a software company with a vision of working with businesses, making gaming a priority, and expanding Azure, its cloud network. How Does Microsoft Make Money? A diverse portfolio of many more products allowed Microsoft to branch out from only MS Office and Windows software and adapt to software technology's future. Microsoft has adapted to the world of sales in its subscription-based software model. They sell their Microsoft Office products to businesses and consumers, creating a pay-as-you-go subscription-based business model. Productivity and Business In 2020, Microsoft Office made a significant amount of their revenue from subscription-based software compared to 0% in 2000. MS Office at one point brought close to half of the revenue in 2000, but Office is not even 25% of the revenue that Microsoft takes in now, having over $35 billion in revenue each year. The new software has been revolutionizing businesses. First, they pay for Microsoft Office, and with that, they get Microsoft OneDrive, Teams, and Dynamics. Teams is just a fancy business video chat software like Zoom Video Communications (ZM), but you can only have Teams with Microsoft business accounts. Dynamics is another software that helps with business computing. It helps with business efficiency and works with customer relationship management or CRM, but it is not one of the top competitors to Salesforce (CRM). However, it has over $3 billion in revenue. Windows continues to be one of the most widely used software globally. That domination is starting to penetrate other parts of their customers giving them opportunities to dominate other businesses. With the subscription-based model, they will continue to bring in significant revenue, earnings, and cash flow. Before the proposed acquisition of Activision Blizzard (ATVI), LinkedIn was Microsoft's largest acquisition. It came in at $26 billion in 2016. Today, LinkedIn makes over $8 billion annually in revenue, up from the $3 billion pre-acquisition. LinkedIn has no major competitors and creates most of its money from job offer advertisements, other advertisements, and cash for LinkedIn premium. The Cloud Cloud software has become a bigger space for companies. It has led Microsoft to enter the space and business opportunities through the Azure Cloud system. Microsoft has thus gained a foothold in the cloud space. Azure Cloud system by Microsoft came out in 2009, and in 2021 the platform had become the second-largest cloud-based service in the world behind Amazon Web Services (AWS). With the cloud service, Microsoft's revenue grew by 48% in quarter 3 of 2021. It has reached a 21% market share and continues to gain more traction in the cloud space. Azure consists of public, private, and hybrid cloud service products that help to power modern businesses. Dynamics and Azure are contributing to over 31% of Microsoft's revenue. In addition, customers are reaping many benefits through the cloud as it enhances the user experience with Microsoft products. The Gaming Industry Microsoft is becoming one of the leaders in the gaming industry. The Xbox is leading the charge with gaming, and Microsoft just made a deal to acquire Activision Blizzard for $69 Billion; if government regulators approve the sale, this acquisition will occur in 2023. The purchase would make Microsoft one of the largest gaming companies in the world. They would then own games like Call of Duty, War of Warcraft, and Candy Crush. In addition, making the deal would put them behind Sony and China's Tencent as a top-three gaming company globally. Microsoft is putting their company in a position to take on the Metaverse. Apple (APPL), Google (GOOG), Meta (FB), and Microsoft are creating technologies for the Metaverse. Satya Nadalla has emphasized that gaming technologies are part of the Metaverse. Is Microsoft a Good Stock to Buy? If we look at the price-to-earnings (P/E) ratio, we end up with an overvalued stock compared to Apple and Google. The P/E ratio is 32.0X, making it a bit more overvalued than Apple, which is trading at a valuation of 28.5X, as of this writing. They are close in the P/E ratio, but you would like to see the P/E ratio lower as an investor. Microsoft is a dividend growth stock that has raised the dividend for 19 consecutive years. The most recent quarterly dividend increase was $0.62 per share from $0.56 per share. The forward annual payout is now $2.48 per share with a conservative payout ratio of about 27%. The question is whether the hype of Microsoft is worth a buy as this company continues to create a diverse portfolio moving from one business to another. You can see the company dominating competitive markets like gaming and cloud systems. It has also innovated different types of software to help other businesses. Microsoft's future looks excellent if you are an investor, but the stock is likely overvalued based on the P/E ratio. In addition, the dividend yield is low at 0.84%. This value is less than the average dividend yield of the S&P 500 Index. Suppose individual stocks are too risky for you. In that case, an alternative is to try an excellent ETF or even a tech ETF to gain exposure to Microsoft and other overvalued tech companies. In many cases, ETFs are market cap-weighted, and Microsoft is one of the top holdings. You can always own a piece of Microsoft, Apple, Google, and Meta through an excellent ETF like an S&P 500 ETF. Microsoft is also a top 10 holding in some of the best dividend growth ETFs. These index funds will help you own a selection of some of the most profitable and most prominent companies in the US. Author Bio: Dividend Power is a self-taught investor and blogger on dividend growth stocks and financial independence. Some of his writings can be found on Seeking Alpha, TalkMarkets, ValueWalk, The Money Show, Forbes, Yahoo Finance, Entrepreneur, FXMag, and leading financial blogs. He also works as a part-time freelance equity analyst with a leading newsletter on dividend stocks. He was recently in the top 1.5% (126 out of over 8,212) of financial bloggers as tracked by TipRanks (an independent analyst tracking site) for his articles on Seeking Alpha. Disclaimer: Dividend Power is not a licensed or registered investment adviser or broker/dealer. He is not providing you with individual investment advice. Please consult with a licensed investment professional before you invest your money.

Netflix - Fall of the king?

Walid Koudmani 24.01.2022 16:38

Netflix (NFLX.US) had humble beginnings. The company started as a mail-based DVD rental business in 1997 when DVDs were becoming mainstream in the United States. It operated with such a model until 2007 when its business focus switched to media streaming via the Internet. While Netflix continued to rent DVDs, its new services gained traction. A deal with major film production studios was reached in 2010 and in the same year the company started to expand beyond the United States by beginning to offer its services in Canada. Expansion accelerated from there and the company got involved in movie and series production. Netflix is now one of the world's best-known entertainment companies, offering services in more than 190 countries and having more than 220 million paid subscribers at the end of 2021 End of pandemic - end of growth? As Netflix increased its subscriber base, so has the company's sales and earnings soared. Netflix generated just slightly below $30 billion in annual revenue in 2021. The company's business benefited greatly from the coronavirus pandemic, with revenue increasing 24% in 2020 and 18.8% in 2021. Stay-at-home mandates boosted demand for various types of at-home entertainment products, including streaming services. However, as the pandemic started to be contained and countries no longer imposed as strict restrictions as they used to, Netflix growth started to slow. The company expects a big slowdown in new subscriber growth in Q1 2022, citing increased competition as the prime reason. Streaming business gets more difficult While Netflix warned that growing competition within the streaming industry makes the outlook for further growth in subscriber numbers bleak, it should be noted that it is not the only company in the business to have doubts about the future. Disney also said that maintaining high subscriber growth rates became difficult as the market became saturated following the Covid-19 boom. While some customers subscribe to multiple streaming services at once to get access to exclusive content, not everyone can afford that and has to decide which one to use. This is even more important now as high inflation causes consumers to be more cautious with spending. What's next? As costs are increasing and subscriber growth is faltering, streaming companies face a difficult decision on what to do next to preserve growth of their business. Streaming companies could boost spending on new productions in order to enrich their portfolio and attract new customers. However, they can also target existing but not "official" customers and this seems to be the decision Netflix decided to take by increasing crackdown on illegal account sharing. This is a risky play - barring such customers from Netflix' service could encourage them to start paying fees but it can also discourage them from using the company's services all together and switch to competition. Another approach to boosting sales in times of rising costs and slower subscriber growth could be boosting plan prices, which is also what Netflix has decided to do with prices for its services in the United States and Canada increasing in late-2021. Investors now have to decide if these steps can keep the bottom line growing or if they are just desperate moves to maintain the status quo. The stock is down more than 30% this year so many investors may see this as a bargain. But this will only be the case if the company finds a path to strong growth again.

Will FOMC Moves Let Us Prepare Kind of Gold Price Prediction?

Arkadiusz Sieron 25.01.2022 16:28

The World Gold Council believes that gold may face similar dynamics in 2022 to those of last year. Well, I’m not so sure about it. Have you ever had the feeling that all of this has already happened and you are in a time loop, repeating Groundhog Day? I have. For instance, I’m pretty sure that I have already written the Fundamental Gold Report with a reference to pop-culture before… Anyway, I’m asking you this, because the World Gold Council warns us against the whole groundhog year for the gold market. In its “Gold Outlook 2022,” the gold industry organization writes that “gold may face similar dynamics in 2022 to those of last year.” The reason is that in 2021, gold was under the influence of two competing forces. These factors were the increasing interest rates and rising inflation, especially strong in operation in the second half of the year, which resulted in the sideways trend in the gold market, as the chart below shows. The WGC sees a similar tug of war in 2022: the hikes in the federal funds rate could create downward pressure for gold, but at the same time, elevated inflation will likely create a tailwind for gold. The WGC acknowledges that the ongoing tightening of monetary policy can be an important headwind for gold. However, it notes two important caveats. First, the Fed has a clear dovish bias and often overpromises when it comes to hawkish actions. For example, in the previous tightening cycle, “the Fed has tended not to tighten monetary policy as aggressively as members of the committee had initially expected.” Second, financial market expectations are more important for gold prices than actual events. As a result, “gold has historically underperformed in the months leading up to a Fed tightening cycle, only to significantly outperform in the months following the first rate hike.” I totally agree. I emphasized many times the Fed’s dovish bias and that the actual interest rate hikes could be actually better for gold than their prospects. After all, gold bottomed out in December 2015, when the Fed raised interest rates for the first time since the Great Recession. I also concur with the WGC that inflation may linger this year. Expectations that inflation will quickly dissipate are clearly too optimistic. As China is trying right now to contain the spread of the Omicron variant of the coronavirus, supply chain disruptions may worsen, contributing to elevated inflation. However, although I expect inflation to remain high, I believe that it will cool down in 2022. If so, the real interest rates are likely to increase, creating a downward pressure on gold prices. I also believe that the WGC is too optimistic when it comes to the real interest rates and their impact on the yellow metal. According to the report, despite the rate hikes, the real interest rates will stay low from a historical perspective, supporting gold prices. Although true, investors should remember that changes in economic variables are usually more important than their levels. Hence, the rebound in interest rates may still be harmful for the precious metals. Implications for Gold What should be expected for gold in 2022? Will this year be similar to 2021? Well, just like last year, gold will find itself caught between a hawkish Fed and high inflation. Hence, some similarities are possible. However, in reality, we are not in a time loop and don’t have to report on Groundhog Day (phew, what a relief!). The arrow of time continues its inexorable movement into the future. Thus, market conditions evolve and history never repeats itself, but only rhymes. Thus, I bet that 2022 will be different than 2021 for gold, and we will see more volatility this year. In our particular situation, the mere expectations of a more hawkish Fed are evolving into actual actions. This is good news for the gold market, although the likely peak in inflation and normalization of real interest rates could be an important headwind for gold this year. Tomorrow, we will get to know the FOMC’s first decision on monetary policy this year, which could shake the gold market but also provide more clues for the future. Stay tuned! If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Binance Coin price bound for 15% upswing as bulls make a comeback

FXStreet News 26.01.2022 16:40

Binance Coin has been range trading for the past four days between $335 and $389. BNB price shows bulls pushing bears against the high of this week, ready for a breakout. Expect bears to be stopped out and open momentum for bulls to run the price up to $452. Binance Coin (BNB) price was able to find a floor at $335 with the monthly S2 monthly support level as an area where bulls were interested in getting involved in the price action. BNB price is now quickly ramping up and squeezing bears out of their entries at $389, which is acting as the weekly high. With the squeeze, a pop is set to unfold towards $452, the first significant level of resistance that could halt the rally near-term. BNB price set for a bullish breakout Binance Coin sees bulls trading away from the monthly S2 support level at $335 tested twice and bulls jumping on the buying volume to get involved in the price action. Backed by the green ascending trendline, a bullish entry makes sense as the Relative Strength Index (RSI) has just exited oversold territory. As such, sellers do not have much incentive to stay further in their short positions as further gains look limited for now. BNB price thus offers a solid entry point, and bulls are now ready to break above $389, the weekly high and short-term cap that has kept BNB price limited to the upside this week. As bears are being pushed against that level, expect their stops to be run once bulls break above it, which will trigger a massive demand for buying volume and squeeze price action even higher. The monthly S1 does not hold much historical reference, so $452 makes the most sense with the 200-day Simple Moving Average just above as a cap, that needs to be broken to start speaking of an uptrend. BNB/USD daily chart In the wake of the Fed meeting later today, most investors will be holding their breath further into the afternoon. If the Fed delivers a hawkish tone or even hike today, that will set a negative tone for global markets and see a sharp decline in risk assets led by equities and cryptocurrencies. Expect BNB price action to result in bulls being pushed against the monthly S2 support and the green ascending trend line around $320-$335.

Financial Sector ETF XLF $37.50 Continues To Present Opportunities

Chris Vermeulen 26.01.2022 23:16

Recent volatility in the US markets ahead of the Fed comments/actions have prompted a relatively big pullback in almost every sector. Many traders are concerned the Fed may take immediate action to raise rates. Yet, a small portion of traders believes the Fed may be trapped in a position to act more conservatively in addressing inflation going forward. I think the Fed will continue to talk firmly about potentially raising rates. The Fed is more interested in decreasing the assets on their balance sheet before they risk doing anything to disrupt support for the global markets.Suppose my analysis of the Fed predicament is correct. In that case, the recent collapse of the US markets represents a fear-based emotional selloff of many sectors that may still represent a strong opportunity for a recovery rally in 2022. One of those sectors is the Financial sector – particularly XLF.I wrote about this on January 7, 2022, in this article: FINANCIAL SECTOR STARTS TO RALLY TOWARDS THE $43.60 UPSIDE TARGETI also wrote how the US Fed might be playing with fire regarding their stern positioning and statements recently in this article on January 14, 2022: US FEDERAL RESERVE - PLAYING WITH FIRE PART 2Critical Components Of Recent Inflationary TrendsIf you attempt to follow my logic as I read into the Fed's intentions. There are three critical components to navigating the rise of inflationary trends recently.The COVID-19 virus event created several disparities in the global markets. First, the disruption to the labor and supply-side markets began an almost immediate inflationary aspect for the global economy. Secondly, the US's stimulus and easy money policies have stimulated demand for products, technology, houses, autos, and other real assets. These two factors combined have increased inflationary pressures on the global markets.Rising consumer demand for real and virtual assets such as Cryptos, NFTs, and others has pushed the speculative investing cycle into a hyper-active rally phase. This was clearly witnessed in early 2021, with the Reddit/Meme rallies became the hottest trades, then quickly dissipated after July 2021. This speculative rally has pushed the post-COVID rally well beyond reasonable expectations over the past 16+ months.Excessive debt levels push a deflationary process to the forefront. Consumers are now starting to pull away from the excesses of the past 16+ months. The Fed's tough talk and recent deeper declines in various sectors over the past 12+ months show that inflationary trends are subsiding. Despite the supply-side issues being resolved, consumers continue to pull away from hyper-speculative activities. The markets will naturally revalue to support more realistic price levels, deflating excessive P/E ratios and recent extreme price peaks in assets.Possible Next Steps for the US FedMy interpretation of the global markets is that excess speculative trending and rising commodity prices, combined with excess debt levels and consumers who have suddenly become very aware of global market risks, are already acting as a deflationary process. Because of these underlying factors, which I believe are currently in play throughout the globe, the US Federal Reserve may be forced to wait things out a bit. The Fed may have to navigate these natural deflationary processes while attempting to provide monetary support for what I believe will be a downside/deflationary trend over the next 3+ years.Sign up for my free trading newsletter so you don’t miss the next opportunity! The US Federal Reserve may not have to take any aggressive action right now. Instead, it may decide to watch how the global markets contract as consumers pull away from inflated price levels and higher risks and attempt to navigate these natural deflationary price trends. If the Fed were to act aggressively right now and raise rates, they could push the global markets into a steeper collapse. This process would likely burst numerous asset bubbles very quickly and push many foreign nations into some type of debt default.This presents a new problem for the US Fed – going from inflationary concerns to global economic collapse concerns very quickly. So when I suggested the Fed is playing with fire – maybe I should have said “playing with the nuclear economic football”?Financial Sector ResilienceStill, I believe the US Financial sector is showing tremendous resilience near $37.50. I think it has a powerful opportunity to rally back above $42 to $44 if the Fed takes a more measured approach to let the global markets deflate a bit before taking any aggressive actions.The US Financial sector will likely continue to benefit from price volatility and consumer demand as these deflationary trends prompt consumers to engage in more normal economic activities. The Financial sector also has continued to stay under moderate pricing pressure since the 2008 highs. XLF is only 25.46% higher than the 2008 highs, whereas the NASDAQ is more than 575% above the 2008 market highs.The Financial Sector may be one of the strongest market sectors over the next few years. Deflationary trends push consumers and global markets away from excess debt levels and towards more traditional economic activities/trends.Want To Learn More About Financial Sector ETFs?Learn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may start a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to learn more about how my three Technical Trading Strategies can help you protect and grow your wealth in any type of market condition by clicking the following link: www.TheTechnicalTraders.com

Gold Is Bruised but Can Show Strength – By Doing Nothing

Przemysław Radomski 27.01.2022 17:59

The Fed finally said it: the rates are going up. The USD Index and gold heard it and reacted. The former is at new yearly highs, while gold slides. The medium-term outlook for gold is now extremely bearish. The above might sound like a gloom and doom scenario for precious metals investors, but I view it as particularly favorable. Why? Because: This situation allows us to profit on the upcoming decline in the precious metals sector through trading capital. This situation allows us to detect a great buying entry point in the future. When gold has everything against it and then it manages to remain strong – it will be exactly the moment to buy it. To be more precise: to buy into the precious metals sector (I plan to focus on purchasing mining stocks first as they tend to be strongest during initial parts of major rallies). At that moment PMs will be strong and the situation will be so bad that it can only improve from there – thus contributing to higher PM prices in the following months. Most market participants have not realized the above. “Gold and (especially) silver can only go higher!” is still a common narrative on various forums. Having said that, let’s take a look at the short-term charts. In short, gold declined significantly, and it’s now trading once again below the rising support / resistance line, the declining red resistance line, and back below 2021 closing price (taking also today’s pre-market decline into account). In other words: All important short-term breakouts were just invalidated. The 2022 is once again a down year for gold. Is this as bearish as it gets for gold? Well, there could be some extra bearish things that could happen, but it’s already very, very bearish right now. For example, gold market could catch-up with its reactions to USD Index’s strength. The U.S. currency just moved above its previous 2022 and 2021 highs, while gold is not at its 2021 lows. Yet. I wouldn’t view gold’s performance as true strength against the USD Index at this time just yet. Why? Because of the huge consolidation that gold has been trading in. The strength that I want to see in gold is its ability not to fall or soar back up despite everything thrown against it, not because it’s stuck in a trading range. In analogy, you’ve probably seen someone, who’s able to hold their ground, and not give up despite the world throwing every harm and obstacle at them. They show their character. They show their strength. Inaction could represent greater wisdom and/or love and focus on one’s goal that was associated with the lack of action. You probably know someone like that. You might be someone like that. The above “inaction” is very different from “inaction” resulting from someone not knowing what to do, not having enough energy, or willpower. Since markets are ultimately created by people (or algorithms that were… ultimately still created by people) is it any surprise that markets tend to work in the same way? One inaction doesn’t equal another inaction, and – as always – context matters. However, wasn’t gold strong against the USD Index’s strength in 2021? It was, but it was very weak compared to the ridiculous amounts of money that were printed in 2020 and 2021 and given the global pandemic. These are the circumstances, where gold “should be” soaring well above its 2011 highs, not invalidating the breakout above it. The latter, not the former, happened. Besides, the “strength” was present practically only in gold. Silver and miners remain well below their 2011 highs – they are not even close to them and didn’t move close to them at any point in 2020 or 2021. Gold has been consolidating for many months now, just like it’s been the case between 2011 and 2013. The upper part of the above chart features the width of the Bollinger Bands – I didn’t mark them on the chart to keep it clear, but the important detail is that whenever their width gets very low, it means that the volatility has been very low in the previous months, and that it’s about to change. I marked those cases with vertical dashed lines when the big declines in the indicator took it to or close to the horizontal, red, dashed line. In particular, the 2011-2013 decline is similar to the current situation. What does it mean? It means that gold wasn’t really showing strength – it was stuck. Just like 2012 wasn’t a pause before a bigger rally, the 2021 performance of gold shouldn’t be viewed as such. What happened yesterday showed that gold can and will likely react to hawkish comments from the Fed, that the USD Index is likely to rally and so are the interest rates. The outlook for gold in the medium term is not bullish, but very bearish. The above is a positive for practically everyone interested in the precious metals market (except for those who sell at the bottom that is), as it will allow one to add to their positions (or start building them) at much lower prices. And some will likely (I can’t guarantee any performance, of course) gain small (or not so small) fortunes by being positioned to take advantage of the upcoming slide. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

NASDAQ, Non-Farm Payrolls, GBPAUD, Gold and More in The Next Episode of "The Trade Off"

Stock Market in 2022: Momentum on the Stocks in the Market Are In a Solid Footing

Finance Press Release 28.01.2022 10:51

The year 2022 is seemingly a mixed bag, even as markets start reopening. The year looks promising, though, with issues like inflation and COVID to contemplate. Historic rallies in 2021 after lockdowns are looking to inspire trading in various industries, with some assets to look out for by investors. Growth will surely return at some point, but so will disappointing instances where tumbles will dominate trading desks. The S & P's historic gains of 30 percent dominated the press at the close of 2021, making investors using Naga and other optimistic platforms. The ended year had one of the longest bull markets. However, the Fed rate tightening and the direction the pandemic will take are some things to expect, notwithstanding that the stock market might grow by a whopping 10 percent in 2022. Trading Movements In Week One 2022 European markets have opened with a lot of optimism in 2022, the pan-European STOXX 600 closed at 489.99 points; this is 0.5 percent higher than the opening figure. The European benchmark was some percentage lower than the overall S&P 2021 performance, though with a surge of 22.4 percent. Record gains in the stock markets have relied on the positions taken by the governments during the pandemic. In the USA and Europe, increasing vaccination rates and economic stimulus measures have improved investor confidence. However, there are indications for more volatility in 2022, a situation investors must watch keenly. There has been little activity in London markets in the first week of 2022, while in Italy, France, and Spain gains of between 0.5-1.4 percent made notable highlights. European markets had diverse industries drive up the closing gains witnessed; the airline sector, in particular, has had a significant influence. Germany’s Lufthansa (LHAG.DE) had an impressive 8.8 percent jump while Air France KLM (AIRF.PA), a 4.9 percent gain. Factory activity is another factor to thank for the first week's gains all over Europe. Noteworthy, the Omicron variant influenced trading in the entirety of December, but the reports that it is milder than Delta has energized market activities coming into January. S&P and DOW Jones 2022 First Week Highs Across the Atlantic, the Dow Jones Industrial Average (DJI) and S&P 500 (SPX) closed at a record high, highlighting a similar aggressiveness as the European markets. While the jump was industrial-wide, Tech stocks continued to dominate, as Apple finally touched the $3 trillion valuation, though for a short time. Tesla Inc. (TSLA.O) posted a 13.5 percent jump thanks to increased production in China and an unprecedented goal to surpass its target. The US market, like the European market, is also in a fix; the Omicron variant of COVID-19 continues to cause concern with the wait-and-see approach, the only notable strategy. Currently, every country is reporting a jump in the number of Covid cases, with the UK going above 100K cases for the first time and the US recording some new records as well. School delays and increased isolation by key workers will surely debilitate the markets, with the global chip shortage another point to contemplate. However, markets can still ride on the increased development of therapies to help fight Covid. The U.S. Food and Drug Administration (CDC) has been quick, as now children can have their third doses as well. Industries to Look Out For In 2022 European automakers have seen early peaks, while the airline sector has also picked up fast. In the US, tech shares continue to dominate, and 2022 might witness new records never seen before. However, the energy sectors have also dominated the news in 2021, and in 2022; the confidence in them will continue to rise because of an anticipation of stabilization in energy prices. The same goes for crude oil prices. Regardless, shareholders will continue watching the decisions by the Federal Reserve, a review in the current interest rates will surely tame inflation. Conclusion 2022 will see its highs and lows in investments. Some assets will make the news and investors will be keen to use any information to make key decisions. Tech will continue to shine, but it is important to anticipate the direction of the pandemic, as it will be an important factor in investor decisions.

Many Factors to Affect XAU This Year. What About The Past?

Arkadiusz Sieron 28.01.2022 10:38

Gold’s fate in 2021 will be determined mainly by inflation and the Fed’s reaction to it. In the epic struggle between chaos and order, chaos has an easier task, as there is usually only one proper method to do a job – the job that you can screw up in many ways. Thus, although economists see a strong economic expansion with cooling prices and normalization in monetary policies in 2022, many things could go wrong. The Omicron strain of coronavirus or its new variants could become more contagious and deadly, pushing the world into the Great Lockdown again. The real estate crisis in China could lead the country into recession, with serious economic consequences for the global economy. Oh, by the way, we could see an escalation between China and Taiwan, or between China and the US, especially after the recent test of hypersonic missiles by the former country. Having said that, I believe that the major forces affecting the gold market in 2022 will be – similarly to last year’s – inflation and the Fed’s response to it. Considering things in isolation, high inflation should be supportive of gold prices. The problem here is that gold prefers high and rising inflation. Although the inflation rate should continue its upward move for a while, it’s likely to peak this year. Indeed, based on very simple monetarist reasoning, I expect the peak to be somewhere in the first quarter of 2022. This is because the lag between the acceleration in money supply growth (March 2020) and CPI growth (March 2021) was a year. The peak in the former occurred in February 2021, as the chart below shows. You can do the math (by the way, this is the exercise that turned out to be too difficult for Jerome Powell and his “smart” colleagues from the Fed). This is – as I’ve said – very uncomplicated thinking that assumes the stability of the lag between monetary impulses and price reactions. However, given the Fed’s passive reaction to inflation and the fact that the pace of money supply growth didn’t return to the pre-pandemic level, but stayed at twice as high, the peak in inflation may occur later. In other words, more persistent inflation is the major risk for the economy that many economists still downplay. The consensus expectation is that inflation returns to a level close to the Fed’s target by the end of the year. For 2021, the forecasts were similar. Instead, inflation has risen to about 7%. Thus, never underestimate the power of the inflation dragon, especially if the beast is left unchecked! As everyone knows, dragons love gold – and this feeling is mutual. The Saxo Bank, in its annual “Outrageous Predictions”, sees the potential for US consumer prices to rise 15% in 2022, as “companies bid up wages in an effort to find willing and qualified workers, triggering a wage-price spiral unlike anything seen since the 1970’s”. Actually, given the fact that millions of Americans left the labor market – which the Fed doesn’t understand and still expects that they will come back – this prediction is not as extreme as one could expect. I still hope that inflationary pressure will moderate this year, but I’m afraid that the fall may not be substantial. On the other hand, we have the Fed with its hawkish rhetoric and tapering of quantitative easing. The US central bank is expected to start a tightening cycle, hiking the federal funds rate at least twice this year. It doesn’t sound good for gold, does it? A hawkish Fed implies a stronger greenback and rising real interest rates, which is negative for the yellow metal. As the chart below shows, the normalization of monetary policy after the Great Recession, with the infamous “taper tantrum”, was very supportive of the US dollar but lethal for gold. However, the price of gold bottomed in December 2015, exactly when the Fed hiked the interest rates for the first time after the global financial crisis. Markets are always future-oriented, so they often react more to expected rather than actual events. Another thing is that the Fed’s tightening cycle of 2015-2018 was dovish and the federal funds rate (and the Fed’s balance sheet) never returned to pre-crisis levels. The same applies to the current situation: despite all the hawkish reactions, the Fed is terribly behind the curve. Last but not least, history teaches us that a tightening Fed spells trouble for markets. As a reminder, the last tightening cycle led to the reversal of the yield curve in 2019 and the repo crisis, which forced the US central bank to cut interest rates, even before anyone has heard of covid-19. Hence, the Fed is in a very difficult situation. It either stays behind the curve, which risks letting inflation get out of control, or tightens its monetary policy in a decisive manner, just like Paul Volcker did in the 1980s, which risks a correction of already-elevated asset prices and the next economic crisis. Such expectations have boosted gold prices since December 2015, and they could support the yellow metal today as well. Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care.

Fed Comments Help To Settle Global Market Expectations

Chris Vermeulen 28.01.2022 14:59

The recent Fed comments should have helped settle the global market expectations related to if and when the Fed will start raising rates and/or taking further steps to curb inflation trends. Additionally, the Fed has been telegraphing its intentions very clearly over the past few months, providing ample time for traders and investors to alter their approach to pending monetary tightening actions. Read the full Fed Statement here.In my opinion, foreign markets are more likely to see increased risks and declining price trends for two reasons. First, at-risk nations/borrowers struggle to reduce debt levels. Second, foreign market traders/investors struggle to adapt to the transition away from speculative “growth” trends. I think the US Dollar may continue to show strength over the next 4+ months as the foreign traders pile into US economic strength while the Fed initiates their tightening actions. So it makes sense to me that global markets would recoil from Fed tightening while debt-heavy corporations/nations seek relief from rising debt obligations.Foreign Markets Struggle For Support Before US Fed Monetary TighteningIn a continuing downward slide, global market equity indexes continue to move lower after the US Fed comments this week. In this article, I wrote about this dynamic on August 3, 2021: US Markets Stall Near End Of July As Global Markets Retreat - Are We Ready For An August Surprise? At that time, I suggested the US markets were stalling while the global markets continued to decline.Now, nearly five months later, we've seen the US market trend moderately higher, attempting to struggle to new highs and exhibit deep downward price trends, while the global markets have continued to trend lower. As we move closer to the US Fed pushing interest rates higher, I expect these trends to become even more volatile and pronounced.US Equities May Find Support After The Fed Raises RatesThe current dynamic in the global markets is that capital is seeking investments where safety and profitable returns dominate over risks. As the global markets transition ahead of the Fed rate increases, I believe the US markets will continue to dominate global assets in opportunities, safety, and returns. Once the Fed starts to raise interest rates, a brief period of volatility throughout the global markets may occur. Still, that volatility should quickly settle as traders chase a stronger US Dollar, US Dollar-based Dividends, and a potential “melt-up” of the US Equity market (particularly the Dow Jones, S&P500, and possibly the Russell 2000).Sign up for my free trading newsletter so you don’t miss the next opportunity!Unless the US Fed takes very aggressive action in raising rates too quickly, I believe, at least initially, the US equity markets will continue to benefit from perceived strengths compared to many global equities/indexes.This means there will be many opportunities for traders and investors in 2022 and 2023 – we have to be patient in waiting for the chance to profit from these big trends. Jumping ahead of this volatility could be dangerous if you are on the wrong side of the price trend. Instead, wait for the right opportunities while you protect your capital from extreme risks. Let the markets tell you when opportunities are perfect – don't try to force a trade to happen.On December 28, 2021, I published this research article showing how my Adaptive Dynamic Learning (ADL) Predictive Modeling system expects price to trend in 2022 and early 2023: Predictive Modeling Suggests 710 Rally In SPY And QQQ Before April 2022. I strongly suggest taking a look at the recent downside price trends in relation to the lower range of the ADL Predictive Modeling expectations. If my ADL Predictive Modeling system is accurate, we may see a relatively strong recovery in the US stock market throughout the rest of 2022 and beyond.Strategies To Help You Protect And Grow Your WealthLearn how I use specific tools to help me understand price cycles, set-ups, and price target levels in various sectors to identify strategic entry and exit points for trades. Over the next 12 to 24+ months, I expect very large price swings in the US stock market and other asset classes across the globe. I believe the markets are starting to transition away from the continued central bank support rally phase and may start a revaluation phase as global traders attempt to identify the next big trends. Precious Metals will likely start to act as a proper hedge as caution and concern start to drive traders/investors into Metals.I invite you to learn more about how my three Technical Trading Strategies can help you protect and grow your wealth in any type of market condition by clicking the following link: www.TheTechnicalTraders.com

As Fed Is Acting, Is The DXY The Most Interesting Chart For Now?

Przemysław Radomski 28.01.2022 15:42

Despite death wishes from the doubters, the dollar took to the skies on the Fed’s hawkish wings. Gold and silver can wave from the ground for now. While Fed Chairman Jerome Powell threw fuel on the fire on Jan. 26, it’s no surprise that the USD Index has rallied to new highs. For example, while dollar bears feasted on false narratives in 2021, I was a lonely bull forecasting higher index values. Likewise, after more doubts emerged in 2022, the death of the dollar narrative resurfaced once again. However, with the charts signaling a bullish outcome for some time, my initial target of 94.5 was surpassed and my next target of 98 is near. As such, it’s crucial to avoid speculation and wait for confirmation of breakdowns and breakouts. In its absence, the price action often pulls you in the wrong direction. Remember the supposedly bearish move below 95 when the USD Index moved even below its rising support line? It’s been just 2 weeks since that development. On Jan. 14, I wrote the following: In conclusion, 2022 looks a lot like 2021: dollar bears are out in full force and the ‘death of the dollar’ narrative has resurfaced once again. However, with the greenback’s 2021 ascent catching many investors by surprise, another re-enactment will likely materialize in 2022. Moreover, since gold, silver, and mining stocks often move inversely to the U.S. dollar, their 2022 performances may surprise for all of the wrong reasons. As such, while the dollar’s despondence is bullish for the precious metals, a reversal of fortunes will likely occur over the medium term. Given yesterday’s reversal in the USD Index, it’s likely also from the short-term point of view – we could see the reversal and the return of the USD’s rally and PMs’ decline any day or hour now. Fortunately, if you’ve been following my analyses, the recent price moves didn’t catch you by surprise. What’s next? While the USD Index still needs to confirm the recent breakout and some consolidation may ensue, the bullish medium-term thesis remains intact. More importantly, though, the USD Index’s gain has resulted in gold, silver, and mining stocks’ pain. For example, the dollar’s surge helped push gold below its short-and-medium-term rising support lines (the upward sloping red lines on the bottom half of the above chart). However, since the USD Index hit a new high and gold didn’t hit a new low, is the development bullish for the yellow metal? To answer, I wrote on Jan. 27: The U.S. currency just moved above its previous 2022 and 2021 highs, while gold is not at its 2021 lows. Yet. I wouldn’t view gold’s performance as true strength against the USD Index at this time just yet. Why? Because of the huge consolidation that gold has been trading in. The strength that I want to see in gold is its ability not to fall or soar back up despite everything thrown against it, not because it’s stuck in a trading range. In analogy, you’ve probably seen someone, who’s able to hold their ground, and not give up despite the world throwing every harm and obstacle at them. They show their character. They show their strength. Inaction could represent greater wisdom and/or love and focus on one’s goal that was associated with the lack of action. You probably know someone like that. You might be someone like that. The above “inaction” is very different from “inaction” resulting from someone not knowing what to do, not having enough energy, or willpower. Since markets are ultimately created by people (or algorithms that were… ultimately still created by people) is it any surprise that markets tend to work in the same way? One inaction doesn’t equal another inaction, and – as always – context matters. However, wasn’t gold strong against the USD Index’s strength in 2021? It was, but it was very weak compared to the ridiculous amounts of money that were printed in 2020 and 2021 and given the global pandemic. These are the circumstances, where gold “should be” soaring well above its 2011 highs, not invalidating the breakout above it. The latter, not the former, happened. Besides, the “strength” was present practically only in gold. Silver and miners remain well below their 2011 highs – they are not even close to them and didn’t move close to them at any point in 2020 or 2021. The Eye in the Sky Doesn’t Lie Moreover, if we zoom out and focus our attention on the USD Index’s weekly chart, the price action has unfolded exactly as I expected. For example, while overbought conditions resulted in a short-term breather, the USD Index consolidated for a few weeks. However, history shows that the greenback eventually catches its second wind. To explain, I previously wrote: I marked additional situations on the chart below with orange rectangles – these were the recent cases when the RSI based on the USD Index moved from very low levels to or above 70. In all three previous cases, there was some corrective downswing after the initial part of the decline, but once it was over – and the RSI declined somewhat – the big rally returned and the USD Index moved to new highs. Please see below: Just as the USD Index took a breather before its massive rally in 2014, it seems that we saw the same recently. This means that predicting higher gold prices (or those of silver) here is likely not a good idea. Continuing the theme, the eye in the sky doesn’t lie, and with the USDX’s long-term breakout clearly visible, the wind remains at the dollar’s back. Furthermore, dollar bears often miss the forest through the trees: with the USD Index’s long-term breakout gaining steam, the implications of the chart below are profound. While very few analysts cite the material impact (when was the last time you saw the USDX chart starting in 1985 anywhere else?), the USD Index has been sending bullish signals for years. Please see below: The bottom line? With my initial 2021 target of 94.5 already hit, the ~98-101 target is likely to be reached over the medium term (and perhaps quite soon) Mind, though: we’re not bullish on the greenback because of the U.S.’s absolute outperformance. It’s because the region is fundamentally outperforming the Eurozone. The EUR/USD accounts for nearly 58% of the movement of the USD Index, and the relative performance is what really matters. In conclusion, the USD Index’s ascent has surprised investors. However, if you’ve been following my analysis, you know that I’ve been expecting these moves for over a year. Moreover, with the rally poised to persist, gold, silver, and mining stocks may struggle before they reach lasting bottoms. However, with long-term buying opportunities likely to materialize later in 2022, the precious metals should soar to new heights in the coming years. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Unforced Errors - 31.01.2022

David Merkel 09.11.2021 04:40

Photo Credit: Paul Kagame || Hail Emperor Xi, the greatest since Qin Shi Huang! Ready for a cold winter? Much of the world is not. Many places have discouraged using hydrocarbons to produce power, ostensibly for environmental goals, whether those are valid or not. Whether by the fiat of the Chinese Communist Party, or because some Eurocrats push a green agenda, many people are facing a winter where power/heat may be limited. And even if there may not be absolute shortages everywhere, higher prices for all forms of energy, will pinch the budgets of many in the lower middle class and below this winter in the Northern Hemisphere. Part of this stems from central planning. China is the easiest example. Xi Jinping has arrogated to himself more and more power over time, changing the dynamics of the Communist Party, which once at least had some factions, to a unitary party that has only one leader, Emperor President Xi. Some of it came about by eliminating corrupt rivals, but the rest from instilling fear within the Party. Almost every evening, my wife and I read the Bible together. Recently we have been going through the post-exilic portions of the Old Testament where the Jews live under the rule of the Babylonian and Medo-Persian Empires. Those rulers were typically absolute monarchs: do what I say or die! In going through Esther, my wife commented that it was stupid to have laws that cannot be altered. (The same thing is stated in the Book of Daniel.) My comment back to her was if you were an absolute monarch in that era, you were God walking on earth, and could never be wrong. Thus no decree of an Emperor could be wrong. And so it is for President Xi: everything he says is right. He may be an atheist, but to the Chinese in Red China, he is “God walking on Earth” in at least the Hegelian sense. As such, he makes a decree, and those serving him are scared to do anything more or less than he wants. But with vague directives, what does he want? Unilateral authority is particularly vulnerable to making mistakes. In the intermediate-term, China is likely to get weaker because of the increasing concentration of power of President Xi. That’s not to say that capitalist democracies can’t run off the rails, but typically with enough dissenting voices, the worst outcomes don’t usually take place. There are exceptions though. The first exception is regulators with too much discretionary authority. By pursuing one limited goal in the short-run, such as long-term environmental objectives, they may harm the interests of ordinary people in developed markets by making it hard to get food, fuel/energy, and other necessities. And applying the same rules in foreign policy, they may well condemn the developing world to permanent poverty. The developing world thinks the developed world doesn’t care. They are right, and they will ignore what their current leaders have promised in order to curry temporary favor with the developed world. Now where there is the ability to self-correct, eventually societies will remove regulators, politicians, etc. That said, some things are more entrenched than others. I speak of the cult of stimulus. What is more untouchable than the central banks? It’s hard to think of anything more unaccountable. They may technically be beholden to the local parliament, but practically, no one ever messes with them aside from despots pursuing hyperinflation (Venezuela, Turkey, Lebanon, etc.). What gores me is that the unaccountable central banks never ‘fess up to errors. Listen to this: “Asset prices remain vulnerable to significant declines should investor risk sentiment deteriorate, progress on containing the virus disappoint, or the economic recovery stall,” the Fed said in its twice-yearly Financial Stability Report released Monday.Fed Warns of Peril in Run-Up of Risky Asset Prices, Stablecoins That serial blower of bubbles, the Fed, warns us about the height of risky asset prices. Fed policy works via encouraging economic actors to borrow less or more. They have been running a more aggressive monetary policy than they ever needed to, and in the process have inflated housing prices, stocks, bonds of all sorts, private equity, etc. This is not just true of the Fed in the US, but in most developed country central banks. This was an unforced error. Monetary policy could have been tightened in mid-2020, and I mean raising the Fed funds rate, not just stopping QE. When the equity markets race to new highs so rapidly, why should any stimulus exist at all? We don’t need stimulus from Congress either. When demand is so strong that supply chains creak, buckle, and seize up, it is not time to stimulate more, rather, it is time to balance the budget. I would like to think that supply-chain troubles, inflation, and growth are all transitory. But if in an effort to force growth higher than it should be in the short-run, the growth will still be transitory, but the supply-chain troubles and inflation will persist. Beware the experts that say they run things for your good; they likely don’t know what they are doing. ============= Ending note: one more thing, beware the inflation numbers, particularly on items in short supply. If the economists reduce the weights on those things in short supply, it will artificially understate inflation.

Breaking up is hard to do - 31.01.2022

David Merkel 10.11.2021 04:04

Photo Credit: Chris Blakeley || Always optimistic when things are growing, and in the dumps when it falls apart Over the years, I have suggested that two firms should break up on a number of occasions: AIG & GE. Both are now in the process of completing their breakups. The news on GE dropped today, and I was surprised that the media did not pick up on one significant question on the GE breakup. Who gets the insurance liabilities that have been a real pain to GE even after selling off Genworth. As I tweeted: General Electric to Split Into Three Public Companies – WSJ https://t.co/BR8uXhhDVJ Notably missing from all the $GE press coverage is who has to pay off the insurance liabilities: Aviation, probably the weakest of the three. Could gore those relying on the guarantee… pic.twitter.com/qhT0y4gfXL— David Merkel (@AlephBlog) November 9, 2021 How could they miss this? I think I first suggested that GE should break up in a comment in RealMoney’s Columnist Conversation sometime back in 2005, but that is lost in the pre-2008 RealMoney file system, and exists no more. In terms of what I can show I will quote from this old post from 2008: 5) File this under Sick Sigma, or Six Stigma — GE is finally getting closer to breaking up the enterprise.� It has always been my opinion that conglomerates don’t work because of diseconomies of scale.� As I wrote at RealMoney: David MerkelGE — Geriatric Elephant4/27/2007 1:16 PM EDT First, my personal bias. Almost every firm with a market cap greater than $100 billion should be broken up. I don’t care how clever the management team is, the diseconomies of scale become crushing in the megacaps. Regarding GE in specific, it is likely a better buy here than it was in early 1999, when the stock first breached this price level. That said, it doesn’t own Genworth, the insurance company that it had to jettison in order to keep its undeserved AAA rating. Which company did better since the IPO of Genworth? Genworth did so much better that it is not funny. 87% total return (w/divs reinvested) for GNW vs. 28% for GE. A pity that GE IPO’ed it rather than spinning it off to shareholders… But here’s a problem with breaking GE up. GE Capital, which still provides a lot of the profits could not be AAA as a standalone entity and have an acceptable ROE. It would be single-A rated, which would push up funding costs enough to cut into profit margins. (Note: GE capital could not be A-/A3 rated, or their commercial paper would no longer be A1/P1 which is a necessary condition for investment grade finance companies to be profitable.) Would GE do as well without a captive finance arm (GE Capital)? It would take some adjustment, but I would think so. So, would I break up GE by selling off GE Capital? Yes, and I would give GE Capital enough excess capital to allow it to stay AAA, even if it means losing the AAA at the industrial company, and then let the new GE Capital management figure out what to do with all of the excess capital, and at what rating to operate. Splitting up that way would force the industrial arm to become more efficient with its proportionately larger debt load, and would highlight the next round of breakups, which would have the industrial divisions go their own separate ways. Position: none, and I have never understood the attraction to GE as a stock Over the years, I continued to write about GE and Genworth (I grew bearish over LTC after analyzing Penn Treaty. I was always bearish on mortgage insurance). I never thought either would do well, but I never expected them to do as badly as they did. Optimistic accounting ploys from the Welch years bit into profits of Immelt, as he was forced to reset accruals higher again and again. Overly aggressive financial and insurance underwriting similarly had to be reversed, and losses realized. After today, all but the successor firm for GE (Aviation) has a chance to do something significant, freed from the distractions of being in a conglomerate. They can focus, and maybe win. As for GE Aviation, because of the insurance liabilities they will probably receive a valuation discount. Maybe they will sacrifice and pay up, selling the liabilities to Buffett with significant overcollateralization. American International Group I first suggested that AIG break up back in 2008. Only M. R. Greenberg had the capability of managing the behemoth, and once he was gone, lower level managers began making decisions that Greenberg would have quashed, which led to short-term gains, and larger long-term losses. After AIG was taken over by the Fed, bit-by-bit they began selling off the pieces — Hartford Steam Boiler, ILFC, AIA, Alico (to MetLife), and more. They were left with a portion of the international P&C business, and the domestic life and P&C businesses. They are now planning on spinning off the domestic life companies, which will leave AIG as a P&C insurer with relatively clean liabilities (They reinsured Asbestos and Environmental with Berkshire Hathaway). Where do we go from here? Is there a lesson here? Avoid complexity. Avoid mixing mixing industrial and financial. Avoid mixing life and P&C. (Allstate is finally splitting that.) That said, there may be another lesson for the future. What of the extremely large companies that are monopolies? Some of them aren’t complex; they just dominate a large area of the economy as monopolies. Governments want to do one of two things with monopolies. They either want to break them up, or turn them into regulated utilities. Why? The government doesn’t like entities that get almost as powerful as them, so they limit their size, scope, and subject them to regulation. So be aware if you hold some of the largest companies in the US or the world, because governments have their eyes on them, and want them to be subject to the government(s). Full disclosure: long MET

Estimating Future Stock Returns, September 2021 Update - 31.01.2022

David Merkel 16.12.2021 04:35

Image credit: All images belong to Aleph Blog This should be a brief post. At the end of the third quarter, the S&P 500 was poised to nominally return -0.64%/year over the next 10 years. As of the close today, that figure was -1.83%/year, slightly more than the -1.84%/year at the record high last Friday. The only period compares with this valuation-wise is the dot-com bubble. We are above dot-com level valuations. And if you view the 10-year returns from the worst time of the dot-com bubble to now, you can see that the results they obtained are milder than what I forecast here. Of course, a lot of what will happen in nominal terms will rely on the actions of the Fed. Will the Fed: Allow a real recession to clear away dud assets that are on life support from low rates? (Collapsing the current asset bubble)Change the terms of monetary policy, and start directly monetizing US Treasury debt? (Risking high inflation)Continue to dither with financial repression, leaving rates low, not caring about moderate inflation, with real growth zero-like. (Zombie economy — this is the most likely outcome for now) In some ways the markets are playing around with something I call “the last arbitrage.” Bonds versus Stocks. The concept of TINA (There is no alternative [to stocks]) relies on the idea that the Fed will be the lapdog of the equity markets. If stocks are high, the Fed is happy. Phrased another way, if the Fed maximizes wealth inequality, it is happy. And the Fed will be happy. They live to employ thousands of macroeconomists who would have a hard time finding real employment. These economists live to corrupt our understanding f the macroeconomy, justifying the actions of the Fed. The Fed just wants to scrape enough seigniorage to pay the staff, and keep Congress and the Administration mollified. All taken out of the hides of those who save. So with the last arbitrage… interest rates have to stay low to keep the stock market high, even if it means slow growth, and moderate and growing inflation. The likely change promulgated by the Fed today, raising the short rate by 0.75% in 2022 will likely flatten the yield curve, leading to a crisis of some sort, and push them back into QE and near-zero short rates. The stock market will have a pullback and a rally, but what of inflation? How will people act when there is no way to save for the short-run, without inflation eating away value? Brave new world. The Fed is stuck, and we are stuck with them. Gold does nothing, and would be a kinder mistress than the Fed. Better to live within strict limits, than the folly of an elastic currency. But as is true with all things in America, we are going to have to learn this the hard way. PS — As for me, I am living with value stocks, small stocks, and international stocks. Very little in the S&P 500 here.

COT Bonds Speculators cut their bearish 5-Year Treasuries bets for 3rd week

Invest Macro 29.01.2022 18:44

COT Euro Currency Speculators boosted their bullish bets to 23-week high

Invest Macro 29.01.2022 18:55

COT Metals Speculators boost Gold bullish bets to highest since Nov. 30th

Invest Macro 29.01.2022 18:33

COT Energy Speculators push Brent Crude Oil bearish bets to 14-week high

Invest Macro 29.01.2022 18:30

As Prices Of Fertilizers Grows, Prices Of Food Would Most Probably Increase

COT Soft Commodities Speculators sharply raised Corn bullish bets for 1st time in 4 weeks

Invest Macro 29.01.2022 18:28

Brent Oil Price Is Quite Close to $90 - Increased A Lot In January

Alex Kuptsikevich 31.01.2022 12:07

Oil has added more than 14% this month, and Brent spot contracts are trading near $90 a barrel. Steady strengthening has been underway for the past two months after it became clear that the widespread Omicron strain is not leading to new travel restrictions. The November correction in oil served the bulls well by unloading the market from an overhang of bullish positions. We now see a resistance breakout, which has reversed oil twice before, in 2018 and 2021. On the fundamental analysis side, we also see a short-term bullish picture for oil. The Americans continue to ramp up drilling activity, bringing the number of working rigs to 610 last week. However, this is still not enough to significantly accelerate production. Production has stabilised around 11.7 mln BPD for the last nine weeks. These are significant volumes by historical standards: America only produced more from early 2019 to May 2020. But these volumes are not enough to stem the decline in stocks, which have returned to the region of the 2019 lows despite the sell-off and the strategic reserve. On the other hand, there are no signs yet that OPEC+ will accelerate its 400k BPD production increase plan at the beginning of the month. Moreover, there is a chronic over-quota, meaning countries are producing less than quotas allow. Some attribute this to Saudi Arabia and other Gulf countries pushing prices as high as possible. But several observers also point out that the cartel and many other countries cannot produce more because they have severely underinvested in past years. This argument is doubly true for Russia, the US, and several countries where production requires sustained investment. This sets the stage for oil to move into the $85-105 area in the first half of the year. However, oil bulls should remain cautious because of tightening monetary conditions in the US and other DM countries. In addition, production is rising, albeit slowly, and the demand ceiling is just around the corner.

XAU Stays Strong, But Went Below The "Iconic" Value

Arkadiusz Sieron 01.02.2022 16:30

Gold fought valiantly, gold fought nobly, gold fought honorably. Despite all this sacrifice, it lost the battle. How will it handle the next clashes? Have you ever felt trapped in the tyranny of the status quo? Have you ever felt constrained by some invisible yet powerful forces trying to thwart the fullest realization of your potential? I guess this is what gold would feel like right now – if metals could feel anything, of course. Please take a look at the chart below. As you can see, January looked to be quite good for the yellow metal. Its price surpassed the key level of $1,800 at the end of 2021, rallying from $1,793 to $1,847 on January 25, 2022. Then the evil FOMC published its hawkish statement on monetary policy. In its initial response, gold slid. That’s true, but it bravely defended its positions above $1,800 during both Wednesday and Thursday. There was still hope. However, on Friday, the metal capitulated and plunged to $1,788. Here we are again – below the level of $1,800 that gold hasn’t been able to exceed for more than several days since mid-2021, as the chart below shows. Am I disappointed? A bit. Naughty goldie! Am I surprised? Not at all. Although I cheered the recent rally, I was unconvinced about its sustainability in the current macroeconomic context, i.e., economic recovery with tightening of monetary policy (the surprisingly positive report on GDP in the fourth quarter of 2021 didn’t probably help gold), rising interest rates, and possibly a not-distant peak in inflation. In the previous edition of the Fundamental Gold Report, I described the Fed’s actions as “a big hawkish wave that could sink the gold bulls” and pointed out that “gold started its decline before the statement was published, which may indicate more structural weakness.” I added that it was also disturbing that “gold was hit even though the FOMC statement came largely as expected.” Last but not least, I concluded my report with a warning that “the upcoming weeks may be challenging for gold, which would have to deal with rising bond yields.” My warning came true very quickly. Of course, we cannot exclude a relatively swift rebound. After all, gold can be quite volatile in the short-term, and this year could be particularly turbulent for the yellow metal. However, I’m afraid that the balance of risks for gold is the downside. Next month (oh boy, it’s February already!), we will see the end of quantitative easing and the first hike in the federal funds rate, followed soon by the beginning of quantitative tightening and further rate hikes. Using its secret magic, the Fed has convinced the markets that it has become a congregation of hawks, or even a cult of the Great Hawk. According to the CME Fed Tool, future traders have started to price in five 25-basis-point raises this year, while some investors believe that the Fed will lift interest rates by 50 basis points in March. All these clearly hawkish expectations led to the rise in bond yields (see the chart below), creating downward pressure on gold. Implications for Gold What does the recent plunge in gold prices imply for investors? Well, in a sense, nothing, as short-term price movements shouldn’t affect long-term investments. Trading and investing should be kept separate. However, gold’s return below $1,800 can disappoint even the biggest optimists. The yellow metal failed again. Not the first and not the last time, though. In my view, gold may struggle by March, as all these hawkish expectations will exert downward pressure on the yellow metal. In 2015, the first hike in the tightening cycle coincided with the bottom of the gold market. It may be similar this time, as the actual hike could ease some of the worst expectations and also push markets to think beyond their tightening horizon. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Markets Situation, Federal Reserve, Crude, EURJPY, Gazprom And More - "The Trade Off" Is Here!

It Won't Be A Surprise, If We Say S&P 500 Is Moving Like APPL (Apple) According To These Charts...

Paul Rejczak 01.02.2022 15:38

Stocks extended their Friday’s rally yesterday, as the S&P 500 index broke above the 4,500 level. Is this still just an upward correction? The S&P 500 index gained 1.89% on Monday, as it extended its Friday’s gains and broke above the 4,500 level. It retraced more of its recent declines after breaking above the last week’s consolidation along the 4,300-4,400. On last Monday’s low of 4,222.62 the market was 596 points or 12.4% below the Jan. 4 record high of 4,818.62. And yesterday it reached the new local high of 4,516.89. It still looks like an upward correction within a downtrend, however, the market may be also trading within a new uptrend. Late December – early January consolidation along the 4,800 level was a topping pattern and the index retraced all of its December’s record-breaking advance. On Friday it broke above a steep short-term downward trend line. This morning the S&P 500 index is expected to open 0.3% higher following an overnight consolidation. The nearest important resistance level is now at 4,500-4,550, marked by the previous local lows. The resistance level is also at 4,600. On the other hand, the support level is at 4,400-4,450, marked by the recent resistance level. The S&P 500 is now back above its early December local low, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Apple Rallies Again Recently, Apple stock fluctuated along the support level of $155.0-157.5 following mid-January downtrend ahead of its quarterly earnings release. The stock reversed the downtrend after breaking above a short-term consolidation and since the earnings release it gained more than 10%. The resistance level is at around $180.0-183.0, marked by the Jan. 4 record high of $182.94. Conclusion The S&P 500 index extended its Friday’s advance yesterday and it broke slightly above the 4,500 level. It still looks like an upward correction following mid-January declines and a rebound within a new medium-term downtrend. Stocks may further extend their uptrend, but there’s a risk of a short-term downward reversal. Today the index is expected to open 0.3% higher, and we may see some uncertainty and a consolidation along the 4,500 level. The market will be waiting for the quarterly earnings releases (AMD, Alphabet today after the session’s close, Meta tomorrow and Amazon on Thursday, among others) and Friday’s monthly jobs data announcement. There is still an uncertainty concerning Russia-Ukraine tensions. We decided to close our profitable long position that was opened on Tuesday, Jan. 25 at the 4,335 level - S&P 500 continuous futures contract. The details of that position (stop-loss and profit target levels) were available for our subscribers in the premium Stock Trading Alerts. Here’s the breakdown: The S&P 500 broke above the 4,500 level again; it still looks like an upward correction. We decided to close our speculative long position from last Tuesday (4,335 level) at the opening of today’s cash market’s trading session – a gain of around 175 index points. In our opinion, no positions are currently justified from the risk/reward point of view. Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Stock Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Paul Rejczak,Stock Trading StrategistSunshine Profits: Effective Investments through Diligence and Care * * * * * The information above represents analyses and opinions of Paul Rejczak & Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. At the time of writing, we base our opinions and analyses on facts and data sourced from respective essays and their authors. Although formed on top of careful research and reputably accurate sources, Paul Rejczak and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Rejczak is not a Registered Securities Advisor. By reading his reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Paul Rejczak, Sunshine Profits' employees, affiliates as well as their family members may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Deer in the Headlights

Monica Kingsley 03.02.2022 15:56

S&P 500 is slowly getting under pressure, which is likely to culminate on weak non-farm payrolls tomorrow if Wednesday was any guide. Credit markets are pushing for higher yields as inflation data keep surprising those policy makers who had been already surprised throughout 2021. Commodities though aren‘t freezing as a proverbial deer in the headlights, and once the scare of the Fed‘s short tightening cycle gets done away with, precious metals would join. In the meantime, look for silver to act on copper‘s cue, and for gold to do relatively better in risk-off settings.As for stocks, my gentle selling bias while on the lookout to enter short towards the session‘s end, hasn‘t changed since yesterday, and the new position is already profitable:(…) the low volume behind the upswing coupled with credit market reversal shows that the push towards 4,600 is next – but it would be fraught with internal vulnerability. It‘s that value has welcomed the risk-on turn while tech barely prevented lower values – the bond reprieve won‘t last, and is providing more fuel behind the commodities push higher, and precious metals recovery.The Kashkari effect and good ISM Manufacturing PMIs have worked fine, but the services data awaits. And I‘m looking at it to throw a spanner in the works, a modest one. For now, controlling the overall risk is key – fresh portfolio highs were achieved yesterday as new S&P 500 long profits were taken off the table – and commodities with precious metals are likely to do well in this extended (sticking out like a sore thumb) rally off oversold levels (in tech). The other key thought expressed in the linked tweet is that S&P 500 hasn‘t entered a bear market, that it hasn‘t rolled over to the downside for good. It‘s that I expect the return of the bears in the not too distant future, and a smoother sailing in 2H 2022.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 bulls prevailed yesterday, but would get under pressure relatively soon. The ominous lower knots say a consolidation is knocking on the door.Credit MarketsHYG repelled selling pressure, but that won‘t last – I‘m looking for lower values across the bond spectrum, coinciding with (temporary) dollar upswing. Risk-off.Gold, Silver and MinersAll this risk-off already in and still to come, is failing to press gold and silver really down – and that tells you the true direction is up, just waiting for a (Fed, inflation, stagflation) catalyst.Crude OilCrude oil bulls aren‘t yet wavering, but remain perched pretty high – I‘m looking for sideways to down consolidation as the bears get emboldened by the rising volume. Trying their luck soon.CopperCopper is back to the middle of its recent range, still positioned for an upside breakout. Commodities are pointing in the right direction – note the absence of sellers yesterday. How far would the USD upswing compress the red metal today? Not much, not lastingly.Bitcoin and EthereumThe narrow crypto trading range is over, and the bears are on the move – look for them to take some time before they get going towards BTC $35K.SummaryS&P 500 bulls are about to meet the bears again, and higher yields won‘t save value stocks, let alone spawn a rush to tech safety. The pressure in stocks to probe lower values, is building up, and 4,450 may not be enough to stop it. For all the pause in Fed hawkish jawboning, the tightening cycle is merely getting started, and stocks will feel it. Unlike precious metals, which would reverse prior hesitation once the rate raising starts in earnest, and start going up. And commodities? These aren‘t waiting for anyone‘s greenlight. And neither should you in life – what I would like to bring to your attention, is that volatility is rising, and it thus makes sense to pare back the overall portfolio exposure and position sizing while taking only the strongest of opportunities.Thank you for having read today‘s free analysis, which is available in full at my homesite. There, you can subscribe to the free Monica‘s Insider Club, which features real-time trade calls and intraday updates for all the five publications: Stock Trading Signals, Gold Trading Signals, Oil Trading Signals, Copper Trading Signals and Bitcoin Trading Signals.

Seasonality favors another wave up

Florian Grummes 03.02.2022 21:05

However, these gains attracted some profit-taking at prices around US$1,850. And in the aftermath of last week’s FOMC meeting, gold sold off for three days in a row. This merciless sell-off only ended at US$1,780 wiping out nearly all gains since mid of December. It was some form of the classic “the bull walks up the stairs and the bear jumps out the window” pattern, which is a typical behavior within an uptrend.Hence and exactly for this reason, the deep pullback did not necessarily end the recovery in the gold market. Of course, in the bigger picture, the entire precious metals sector is still stuck in this tenacious correction which has been ongoing since August 2020. In the short-term, however, the pullback has created an oversold setup and once again proved that there is buying interest at prices below US$1,800.US-Dollar index, daily chart as of February 3rd, 2022. False breakout?US-Dollar index, daily chart as of February 3rd, 2022.It also seems that the US-Dollar might have hit an important top last Thursday and is now moving lower, which would be very supportive for gold, of course. Everyone is expecting the US-Dollar to go up as the FED is expected to raise interest rates. But the US-Dollar has been discounting this “hike and taper scenario” for several months already. Actually, the US-Dollar index has been rallying +8.8% since May 2021! During the recent FOMC meeting, however, big money might have used the seeming breakout to sell their dollar longs into a favorable high-volume setup. At the same time, stock market sentiment was extremely bearish. Hence, last week likely triggered a top in the US-Dollar and a violent back and forth bottoming pattern for the stock-market.US-Dollar index, monthly chart as of February 3rd, 2022. A series of lower highs!US-Dollar index, monthly chart as of February 3rd, 2022.In the big picture, a top in the US-Dollar would continue the series of lower highs for the dollar. As well, the US-Dollar is moving within a huge triangle since 2001. After a series of three lower highs since December 2016, a test of the lower boundary of the triangle would give gold prices an extreme tailwind in the coming years. Hence, even if it´s hard to come up with any bearish arguments for the dollar at the moment, technically it looks like the dollar could roll over.Gold in US-Dollar, daily chart from February 3rd, 2020. Gold’s behavior is changing.Gold in US-Dollar, daily chart as of February 3rd, 2022.For gold, a weaker US-Dollar would be very helpful. In fact, since the beginning of this week, we perceive an ongoing change in gold’s behavior. We are getting impressed by its intraday strength! Every small pullback around and below US$1,800 was rather quickly bought again. So far, gold has only recovered 38.2% of last week’s nasty sell-off and currently sits pretty much exactly at its 200-day moving average (US$1,805).But the fresh buy signal from the slow stochastic oscillator on the daily chart promises more upside. Hence, we see gold fuming its way higher in the coming weeks. In the next step, gold will have to overcome the 38.2% resistance around US$1,808.50 and then continue its recovery towards US$1,830. In any case, the seasonal component is at least very favorable until the end of February. Therefore, even higher price targets are conceivable too. But gold needs to breakout above the triangle and clear US$1,850. Only then a more sustainable bullish momentum would emerge which could last further into spring.If, on the other hand, gold takes out US$1,780, the recovery since mid of December might be over already and the medium-term correction might likely pick up again.Conclusion: Seasonality favors another wave upOverall, we assume that seasonality favors another wave up in the gold market. Thus, another rally towards at least US$1,830 is realistic. We are short-term bullish, mid-term neutral to skeptic and long-term very bullish for gold.Feel free to join us in our free Telegram channel for daily real time data and a great community. If you like to get regular updates on our gold model, precious metals and cryptocurrencies you can also subscribe to our free newsletter.Disclosure: Midas Touch Consulting and members of our team are invested in Reyna Gold Corp. These statements are intended to disclose any conflict of interest. They should not be misconstrued as a recommendation to purchase any share. This article and the content are for informational purposes only and do not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. The views, thoughts and opinions expressed here are the author’s alone. They do not necessarily reflect or represent the views and opinions of Midas Touch Consulting.By Florian Grummes|February 3rd, 2022|Tags: EUR/USD, Gold, Gold Analysis, Gold bullish, gold chartbook, Gold neutral, precious metals, Reyna Gold, US-Dollar|0 CommentsAbout the Author: Florian GrummesFlorian Grummes is an independent financial analyst, advisor, consultant, trader & investor as well as an international speaker with more than 20 years of experience in financial markets. He is specialized in precious metals, cryptocurrencies and technical analysis. He is publishing weekly gold, silver & cryptocurrency analysis for his numerous international readers. He is also running a large telegram Channel and a Crypto Signal Service. Florian is well known for combining technical, fundamental and sentiment analysis into one accurate conclusion about the markets. Since April 2019 he is chief editor of the cashkurs-gold newsletter focusing on gold and silver mining stocks. Besides all that, Florian is a music producer and composer. Since more than 25 years he has been professionally creating, writing & producing more than 300 songs. He is also running his own record label Cryon Music & Art Productions. His artist name is Florzinho.

Gold Ended January Glued to $1,800. Will It Ever Detach?

Finance Press Release 03.02.2022 16:57

Gold didn’t shine in January. The struggle could continue, although the more distant future looks more optimistic for the yellow metal. That was quick! January has already ended. Welcome to February! I hope that this year has started well for you. For gold, the first month of 2022 wasn’t particularly good. As the chart below shows, the yellow metal lost about $11 of its value, or less than 1%, during January. This is the bad side of the story. The ugly side is that gold wasn’t able to maintain its position above $1,800, even though geopolitical risks intensified, while inflation soared to the highest level in 40 years! The yellow metal surpassed the key level in early January and stayed above this level for most of the time, even rallying above $1,840 in the second half of the month. But gold couldn’t hold out and plunged at the end of January, triggered by a hawkish FOMC meeting. However, there is also a good side. Gold is still hovering around $1,800 despite the upcoming Fed’s tightening cycle and all the hawkish expectations about the US monetary policy in 2022. The Fed signaled the end of tapering of quantitative easing by March, the first hike in the federal funds rate in the same month, and the start of quantitative tightening later this year. Meanwhile, in the last few weeks, the markets went from predicting two interest rate hikes to five. Even more intriguing, and perhaps encouraging as well, is that the real interest rates have increased last month, rising from -1% to -0.6%. Gold is usually negatively correlated with the TIPS yields, but this time it stayed afloat amid rising rates. Implications for Gold What does gold’s behavior in January imply for its 2022 outlook? Well, I must admit that I expected gold’s performance to be worse. Last month showed that gold simply don’t want to either go down (or up), but it still prefers to go sideways, glued to the $1,800 level. The fact that strengthening expectations of the Fed’s tightening cycle and rising real interest rates didn’t plunge gold prices makes me somewhat more optimistic about gold’s future. However, I still see some important threats to gold. First of all, some investors are still underpricing how hawkish the Fed could become to combat inflation. Hence, the day of reckoning could still be ahead of us. You see, just today, the Bank of England hiked its policy rate by 25 basis points, although almost half of the policymakers wanted to raise interest rates by half a percentage point. Second, the market seems to be biased downward, with lower and lower peaks since August 2020. Having said that, investors should remember that what the Fed says it will do and what it ends up doing are often very different. When the Fed says it will be dovish, it will be dovish. But when the Fed says it will be hawkish, it says so. This is because a monetary tightening could be painful for asset valuations and all the debtors, including Uncle Sam. The US stock market already saw significant losses in January. As the chart below shows, the S&P 500 Index lost a few hundred points last month, marking the worst decline since the beginning of the pandemic. Thus, the Fed won’t risk recession in its fight with inflation, especially if it peaks this year, and would try to engineer a soft-landing. Hence, the Fed could reverse its stance relatively soon, especially that it’s terribly late with its tightening. However, as long as the focus is on monetary policy tightening, gold is likely to struggle within its tight range. Some policymakers and economists have argued that the emergence from the COVID-19 pandemic is more like a postwar demobilization and conversion to a civilian industry than a normal business cycle. White House economists have compared the current picture to the rapid increases in 1947, caused by the end of price controls in conjunction with supply chain problems and pent-up demand after the war (“Historical Parallels to Today’s Inflationary Episode”, Council of Economic Advisers, July 6, 2021). The problem with this analogy is that it is only one instance from more than 70 years ago. More recent and more frequent inflation episodes have generally been ended by a recession or a mid-cycle slowdown. Price pressures have an internal momentum of their own and tend to intensify rather than lessen as the business cycle becomes more mature and the margin of spare capacity shrinks in all markets. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Altcoins are climbing out of the pit

Alex Kuptsikevich 04.02.2022 10:54

Down the chain, US stock market dynamics now determine corporate investor sentiment towards Bitcoin and Ether. From the top-down, this sentiment then spreads down to altcoins. But since late last year, there has been a continuing trend that even bitcoin's calming is enough for altcoins to return to growth and outperform the first cryptocurrency. In the last 24 hours, the entire crypto market has added 3.3%, while Ether has gained 4.7% versus Bitcoin's 2.4%. Ether has strengthened by 15% in the last seven days, returning to this month's highs and trying to climb above the bottom levels at the end of September 2021. The cryptocurrency market capitalisation excluding Bitcoin has been hovering around the $1 trillion mark for over a week and approached the upper end of that range on Friday morning. The reduction in volatility in Bitcoin allows for an optimistic outlook on altcoins. At least in the short term. An essential boundary for Ether will be the $3K mark. A return in the price above this level could further encourage buyers and reject the idea of a crypto-winter following the example of 2018. Solana is showing signs of coming out of the hole it fell into at the end of January. The $90 mark has attracted sufficient buyer demand. However, it will be premature to discuss a sustained recovery to the upside, only a stabilisation after the collapse. A BTCUSD consolidation above $40k and Ethereum above $3k would shift the altcoin recovery to a new speed and restart the process of BTC share contraction in the entire market.

Awaiting Non Farm Payrolls, Brent Increased And Hits Ca. $92

Walid Koudmani 04.02.2022 11:36

As usual for the first Friday of the month, investors will be focusing on the highly anticipated Non Farm Payroll report from the US which will give an overview of the job market situation for January and which is expected to show an increase of only 150,000. However, this report will be even more highly focused on since Wednesday's ADP report surprised markets with a significantly below expectation reading of -301,000 and pointed to increasing difficulties in the world's largest economy caused in part by the Omicron variant. While rising costs and supply concerns continue to impact the economic recovery, the FED maintains its position that full employment has been reached and that it will adjust it’s policies when it deems necessary in order to stimulate further growth. A better than expected result could encourage the Fed to continue its approach, while a disappointing reading could cause further concerns and may shift focus slightly on wage figures and their relation to record level inflation in the world's largest economy. Either way, today could see a noticeable increase in volatility as investors assess the situation and as stock markets attempt to stabilize after several weeks of significant moves. UK Construction PMI sparks slight optimism The UK construction sector continued to gain momentum after a difficult end to 2021 thanks to an improvement in commercial activity which helped offset a weak rise in house building. Improvements were also helped by a drop in cost inflation which fell to a 10-month low thanks to an easing of supply issues, which have been affecting the sector for months. As a result, commercial work helped construction growth reach a six-month high but with supplier lead times continuing to lengthen in January as staff shortages and a lack of haulage availability hindered deliveries, the situation continues to be uncertain. Oil prices reach multi year high as global tensions rise As the situation on the Ukraine-Russia border continues to escalate with several countries sending military personnel in an attempt to mitigate the issue, we are seeing another record increase in the price of oil with Brent reaching the highest level since October 2014 and breaking above $92. While OPEC announced it will increase its production by 400,000 barrels per day in March, the market remains concerned for a potential undersupply and general destabilization which could have consequences for the vast majority of sectors in economies as they are tied to oil prices for transport, shipping and energy. We have already noticed increasing energy costs across the world and further tensions could see these increase even more as uncertainty may lead to stockpiling and difficulties in general trade. Despite this, an easing of tensions with a continued global recovery could see the price retreat as long as a balance is maintained with suppliers in the short and medium term.

Ethereum Price Prediction: ETH targets $3,000

FXStreet News 04.02.2022 16:06

Ethereum price made a false break below a short-term trend line yesterday.ETH price breaks above $2,695 and is set for a run towards $3,018.This would mean 13% gains for ETH and a more favourable outlook for next week.Ethereum (ETH) price is set to book the best gains it has made for the whole of 2022, as a bullish candle has now formed on the back of a significant support level. With that move, many bears are getting hurt as they probably fell in the bear trap with the false break below the supportive short-term trend line. Expect more upside to come with global markets enjoying the rally in Amazon shares, which is spilling over into cryptocurrencies and lifting sentiment in ETH towards $3,018.ETH bulls are stabbing bears in the back with a trapEthereum price was dangling below a short-term trend line and looked quite heavy after the slippage (https://www.fxstreet.com/cryptocurrencies/news/top-3-price-prediction-bitcoin-ethereum-ripple-crypto-sentiments-rolls-over-as-meta-shakes-nasdaq-202202031412) from META earnings. But that markets can change their minds overnight is proven yet again, after Amazon’s earnings fueled a booster rally which we are seeing today. This has spilled over into cryptocurrencies and is lifting sentiment in ETH prices with a firm break above $2,695, squeezing out bears in the process, who went short on the false break of the trend line, and it is now just a matter of time before they close out and take their losses.ETH price is thus set for a second rally today as those bears will need to revert to the buy-side volume (https://www.fxstreet.com/cryptocurrencies/news/ethereum-price-pushes-higher-eth-targeting-3-500-202202021800) to close and cut their losses. This will add a boost to ETH prices and could see Ethereum bulls hitting the price target at $3,018, taking out the $3,000 level, and setting the stage for next week. With that move, the red descending trend line could be broken, and with that, the downturn since December, finally (https://www.fxstreet.com/cryptocurrencies/news/ethereum-price-pushes-higher-eth-targeting-3-500-202202021800) breaking the chances for bears and setting the stage for a possible longer-term uptrend.ETH/USD daily chartNevertheless, there are still some earnings on the docket for today that could surprise to the downside and see those tailwinds (https://www.fxstreet.com/cryptocurrencies/news/top-3-price-prediction-bitcoin-ethereum-ripple-crypto-markets-to-favor-bears-soon-202202020838) as quickly fade as they came. Expect that with that lack of support, ETH price will collapse back to $2,695 and start to weigh further on the bulls. Should that spiral into equities, pushing them firmly in the red, and impacting safe haven flow – expect a dip back towards $2,600.

COT Soft Commodities Speculators push Soybean bullish bets to 33-week high

Invest Macro 05.02.2022 17:23

COT Soft Commodities Speculators push Soybean bullish bets to 33-week high - 06.02.2022

Invest Macro 05.02.2022 17:23

COT Energy Speculators push RBOB Gasoline Futures bullish bets to 51-week high

Invest Macro 05.02.2022 17:30

By InvestMacro | COT | Data Tables | COT Leaders | Downloads | COT Newsletter Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC). The latest COT data is updated through Tuesday February 1st 2022 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets. Highlighting the COT energy data is the increase in the RBOB Gasoline futures bets. The speculative net position in the Gasoline futures rose this week for the second time in three weeks and for the eighth time in the past twelve weeks. This bullishness has pushed speculator bets to the highest level in approximately one year, dating back to February 9th of 2021. The RBOB Gasoline futures price has also been on a strong uptrend with prices hitting their highest levels since 2014 this week. Joining Gasoline (5,747 contracts) in gaining this week were Brent Crude Oil (7,016 contracts) and Natural Gas (4,525 contracts) while WTI Crude Oil (-4,511 contracts), Heating Oil (-2,317 contracts) and the Bloomberg Commodity Index (-798 contracts) had lower bets on the week. Data Snapshot of Commodity Market Traders | Columns Legend Feb-01-2022 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index WTI Crude 2,093,735 35 368,904 27 -414,658 63 45,754 79 Gold 515,331 23 172,142 43 -201,342 56 29,200 47 Silver 149,136 15 22,118 44 -35,263 64 13,145 19 Copper 198,437 25 16,155 54 -21,053 45 4,898 54 Palladium 7,853 6 -992 15 965 83 27 46 Platinum 53,898 11 14,581 23 -19,786 81 5,205 35 Natural Gas 1,162,813 12 -120,010 43 90,241 59 29,769 54 Brent 203,928 42 -18,920 86 15,734 15 3,186 52 Heating Oil 347,383 30 15,683 65 -43,137 25 27,454 93 Soybeans 796,285 44 193,373 78 -155,577 29 -37,796 9 Corn 1,568,959 33 455,220 88 -407,663 14 -47,557 16 Coffee 274,865 40 61,378 93 -65,365 9 3,987 16 Sugar 897,035 17 93,593 56 -117,500 46 23,907 37 Wheat 391,162 29 350 47 5,100 46 -5,450 76 WTI Crude Oil Futures: The WTI Crude Oil Futures large speculator standing this week recorded a net position of 368,904 contracts in the data reported through Tuesday. This was a weekly decrease of -4,511 contracts from the previous week which had a total of 373,415 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 26.8 percent. The commercials are Bullish with a score of 62.6 percent and the small traders (not shown in chart) are Bullish with a score of 79.5 percent. WTI Crude Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 23.3 34.4 4.8 – Percent of Open Interest Shorts: 5.7 54.2 2.6 – Net Position: 368,904 -414,658 45,754 – Gross Longs: 487,606 719,202 99,747 – Gross Shorts: 118,702 1,133,860 53,993 – Long to Short Ratio: 4.1 to 1 0.6 to 1 1.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 26.8 62.6 79.5 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 9.5 -12.5 14.4 Brent Crude Oil Futures: The Brent Crude Oil Futures large speculator standing this week recorded a net position of -18,920 contracts in the data reported through Tuesday. This was a weekly rise of 7,016 contracts from the previous week which had a total of -25,936 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 86.1 percent. The commercials are Bearish-Extreme with a score of 15.3 percent and the small traders (not shown in chart) are Bullish with a score of 52.3 percent. Brent Crude Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 18.9 45.3 4.2 – Percent of Open Interest Shorts: 28.1 37.6 2.7 – Net Position: -18,920 15,734 3,186 – Gross Longs: 38,465 92,453 8,604 – Gross Shorts: 57,385 76,719 5,418 – Long to Short Ratio: 0.7 to 1 1.2 to 1 1.6 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 86.1 15.3 52.3 – Strength Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 11.1 -11.3 5.5 Natural Gas Futures: The Natural Gas Futures large speculator standing this week recorded a net position of -120,010 contracts in the data reported through Tuesday. This was a weekly lift of 4,525 contracts from the previous week which had a total of -124,535 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 42.6 percent. The commercials are Bullish with a score of 59.3 percent and the small traders (not shown in chart) are Bullish with a score of 54.4 percent. Natural Gas Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 20.9 40.9 4.8 – Percent of Open Interest Shorts: 31.2 33.2 2.2 – Net Position: -120,010 90,241 29,769 – Gross Longs: 242,699 475,989 55,775 – Gross Shorts: 362,709 385,748 26,006 – Long to Short Ratio: 0.7 to 1 1.2 to 1 2.1 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 42.6 59.3 54.4 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 6.4 -6.1 -4.8 Gasoline Blendstock Futures: The Gasoline Blendstock Futures large speculator standing this week recorded a net position of 65,352 contracts in the data reported through Tuesday. This was a weekly advance of 5,747 contracts from the previous week which had a total of 59,605 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 36.6 percent. The commercials are Bullish with a score of 60.4 percent and the small traders (not shown in chart) are Bullish with a score of 78.7 percent. Nasdaq Mini Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 29.6 47.2 6.8 – Percent of Open Interest Shorts: 11.8 68.0 3.7 – Net Position: 65,352 -76,584 11,232 – Gross Longs: 108,823 173,465 24,970 – Gross Shorts: 43,471 250,049 13,738 – Long to Short Ratio: 2.5 to 1 0.7 to 1 1.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 36.6 60.4 78.7 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 5.3 -12.7 44.7 #2 Heating Oil NY-Harbor Futures: The #2 Heating Oil NY-Harbor Futures large speculator standing this week recorded a net position of 15,683 contracts in the data reported through Tuesday. This was a weekly fall of -2,317 contracts from the previous week which had a total of 18,000 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 65.5 percent. The commercials are Bearish with a score of 25.3 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 93.5 percent. Heating Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 18.7 47.9 14.7 – Percent of Open Interest Shorts: 14.1 60.4 6.8 – Net Position: 15,683 -43,137 27,454 – Gross Longs: 64,794 166,544 51,101 – Gross Shorts: 49,111 209,681 23,647 – Long to Short Ratio: 1.3 to 1 0.8 to 1 2.2 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 65.5 25.3 93.5 – Strength Index Reading (3 Year Range): Bullish Bearish Bullish-Extreme NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 15.9 -23.5 39.1 Bloomberg Commodity Index Futures: The Bloomberg Commodity Index Futures large speculator standing this week recorded a net position of -14,898 contracts in the data reported through Tuesday. This was a weekly decrease of -798 contracts from the previous week which had a total of -14,100 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 50.5 percent. The commercials are Bearish with a score of 48.1 percent and the small traders (not shown in chart) are Bearish with a score of 43.0 percent. Bloomberg Index Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 66.0 30.3 1.4 – Percent of Open Interest Shorts: 96.4 1.2 0.1 – Net Position: -14,898 14,237 661 – Gross Longs: 32,278 14,837 690 – Gross Shorts: 47,176 600 29 – Long to Short Ratio: 0.7 to 1 24.7 to 1 23.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 50.5 48.1 43.0 – Strength Index Reading (3 Year Range): Bullish Bearish Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: -18.8 18.1 7.6 Article By InvestMacro – Receive our weekly COT Reports by Email *COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting).See CFTC criteria here.

COT Energy Speculators push RBOB Gasoline Futures bullish bets to 51-week high

Invest Macro 05.02.2022 17:30

By InvestMacro | COT | Data Tables | COT Leaders | Downloads | COT Newsletter Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC). The latest COT data is updated through Tuesday February 1st 2022 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets. Highlighting the COT energy data is the increase in the RBOB Gasoline futures bets. The speculative net position in the Gasoline futures rose this week for the second time in three weeks and for the eighth time in the past twelve weeks. This bullishness has pushed speculator bets to the highest level in approximately one year, dating back to February 9th of 2021. The RBOB Gasoline futures price has also been on a strong uptrend with prices hitting their highest levels since 2014 this week. Joining Gasoline (5,747 contracts) in gaining this week were Brent Crude Oil (7,016 contracts) and Natural Gas (4,525 contracts) while WTI Crude Oil (-4,511 contracts), Heating Oil (-2,317 contracts) and the Bloomberg Commodity Index (-798 contracts) had lower bets on the week. Data Snapshot of Commodity Market Traders | Columns Legend Feb-01-2022 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index WTI Crude 2,093,735 35 368,904 27 -414,658 63 45,754 79 Gold 515,331 23 172,142 43 -201,342 56 29,200 47 Silver 149,136 15 22,118 44 -35,263 64 13,145 19 Copper 198,437 25 16,155 54 -21,053 45 4,898 54 Palladium 7,853 6 -992 15 965 83 27 46 Platinum 53,898 11 14,581 23 -19,786 81 5,205 35 Natural Gas 1,162,813 12 -120,010 43 90,241 59 29,769 54 Brent 203,928 42 -18,920 86 15,734 15 3,186 52 Heating Oil 347,383 30 15,683 65 -43,137 25 27,454 93 Soybeans 796,285 44 193,373 78 -155,577 29 -37,796 9 Corn 1,568,959 33 455,220 88 -407,663 14 -47,557 16 Coffee 274,865 40 61,378 93 -65,365 9 3,987 16 Sugar 897,035 17 93,593 56 -117,500 46 23,907 37 Wheat 391,162 29 350 47 5,100 46 -5,450 76 WTI Crude Oil Futures: The WTI Crude Oil Futures large speculator standing this week recorded a net position of 368,904 contracts in the data reported through Tuesday. This was a weekly decrease of -4,511 contracts from the previous week which had a total of 373,415 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 26.8 percent. The commercials are Bullish with a score of 62.6 percent and the small traders (not shown in chart) are Bullish with a score of 79.5 percent. WTI Crude Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 23.3 34.4 4.8 – Percent of Open Interest Shorts: 5.7 54.2 2.6 – Net Position: 368,904 -414,658 45,754 – Gross Longs: 487,606 719,202 99,747 – Gross Shorts: 118,702 1,133,860 53,993 – Long to Short Ratio: 4.1 to 1 0.6 to 1 1.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 26.8 62.6 79.5 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 9.5 -12.5 14.4 Brent Crude Oil Futures: The Brent Crude Oil Futures large speculator standing this week recorded a net position of -18,920 contracts in the data reported through Tuesday. This was a weekly rise of 7,016 contracts from the previous week which had a total of -25,936 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 86.1 percent. The commercials are Bearish-Extreme with a score of 15.3 percent and the small traders (not shown in chart) are Bullish with a score of 52.3 percent. Brent Crude Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 18.9 45.3 4.2 – Percent of Open Interest Shorts: 28.1 37.6 2.7 – Net Position: -18,920 15,734 3,186 – Gross Longs: 38,465 92,453 8,604 – Gross Shorts: 57,385 76,719 5,418 – Long to Short Ratio: 0.7 to 1 1.2 to 1 1.6 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 86.1 15.3 52.3 – Strength Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 11.1 -11.3 5.5 Natural Gas Futures: The Natural Gas Futures large speculator standing this week recorded a net position of -120,010 contracts in the data reported through Tuesday. This was a weekly lift of 4,525 contracts from the previous week which had a total of -124,535 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 42.6 percent. The commercials are Bullish with a score of 59.3 percent and the small traders (not shown in chart) are Bullish with a score of 54.4 percent. Natural Gas Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 20.9 40.9 4.8 – Percent of Open Interest Shorts: 31.2 33.2 2.2 – Net Position: -120,010 90,241 29,769 – Gross Longs: 242,699 475,989 55,775 – Gross Shorts: 362,709 385,748 26,006 – Long to Short Ratio: 0.7 to 1 1.2 to 1 2.1 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 42.6 59.3 54.4 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 6.4 -6.1 -4.8 Gasoline Blendstock Futures: The Gasoline Blendstock Futures large speculator standing this week recorded a net position of 65,352 contracts in the data reported through Tuesday. This was a weekly advance of 5,747 contracts from the previous week which had a total of 59,605 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 36.6 percent. The commercials are Bullish with a score of 60.4 percent and the small traders (not shown in chart) are Bullish with a score of 78.7 percent. Nasdaq Mini Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 29.6 47.2 6.8 – Percent of Open Interest Shorts: 11.8 68.0 3.7 – Net Position: 65,352 -76,584 11,232 – Gross Longs: 108,823 173,465 24,970 – Gross Shorts: 43,471 250,049 13,738 – Long to Short Ratio: 2.5 to 1 0.7 to 1 1.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 36.6 60.4 78.7 – Strength Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 5.3 -12.7 44.7 #2 Heating Oil NY-Harbor Futures: The #2 Heating Oil NY-Harbor Futures large speculator standing this week recorded a net position of 15,683 contracts in the data reported through Tuesday. This was a weekly fall of -2,317 contracts from the previous week which had a total of 18,000 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 65.5 percent. The commercials are Bearish with a score of 25.3 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 93.5 percent. Heating Oil Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 18.7 47.9 14.7 – Percent of Open Interest Shorts: 14.1 60.4 6.8 – Net Position: 15,683 -43,137 27,454 – Gross Longs: 64,794 166,544 51,101 – Gross Shorts: 49,111 209,681 23,647 – Long to Short Ratio: 1.3 to 1 0.8 to 1 2.2 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 65.5 25.3 93.5 – Strength Index Reading (3 Year Range): Bullish Bearish Bullish-Extreme NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 15.9 -23.5 39.1 Bloomberg Commodity Index Futures: The Bloomberg Commodity Index Futures large speculator standing this week recorded a net position of -14,898 contracts in the data reported through Tuesday. This was a weekly decrease of -798 contracts from the previous week which had a total of -14,100 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 50.5 percent. The commercials are Bearish with a score of 48.1 percent and the small traders (not shown in chart) are Bearish with a score of 43.0 percent. Bloomberg Index Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 66.0 30.3 1.4 – Percent of Open Interest Shorts: 96.4 1.2 0.1 – Net Position: -14,898 14,237 661 – Gross Longs: 32,278 14,837 690 – Gross Shorts: 47,176 600 29 – Long to Short Ratio: 0.7 to 1 24.7 to 1 23.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 50.5 48.1 43.0 – Strength Index Reading (3 Year Range): Bullish Bearish Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: -18.8 18.1 7.6 Article By InvestMacro – Receive our weekly COT Reports by Email *COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting).See CFTC criteria here.

COT Metals Speculators cut their Gold bullish bets by most in past 146 weeks

Invest Macro 05.02.2022 17:44

By InvestMacro | COT | Data Tables | COT Leaders | Downloads | COT Newsletter Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC). The latest COT data is updated through Tuesday February 1st and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets. Highlighting the COT metals data is this week’s sharp decline in the Gold futures bets. The speculative net position in the Gold futures dropped by -48,009 contracts this week, marking the largest one-week decline in the past one-hundred and forty-six weeks, dating back to April 16th of 2019 when speculator bets fell by -49,091 contracts. The steep drop this week knocked the current speculator standing down to the lowest level since September 28th. Gold prices have been consolidating in a triangle pattern right around the major support/resistance level of $1800. Joining Gold (-48,009 contracts) in falling this week were Silver (-10,023 contracts) and Copper (-10,326 contracts) while Platinum (789 contracts) and Palladium (996 contracts) had position rises this week. Data Snapshot of Commodity Market Traders | Columns Legend Feb-01-2022 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index WTI Crude 2,093,735 35 368,904 27 -414,658 63 45,754 79 Gold 515,331 23 172,142 43 -201,342 56 29,200 47 Silver 149,136 15 22,118 44 -35,263 64 13,145 19 Copper 198,437 25 16,155 54 -21,053 45 4,898 54 Palladium 7,853 6 -992 15 965 83 27 46 Platinum 53,898 11 14,581 23 -19,786 81 5,205 35 Natural Gas 1,162,813 12 -120,010 43 90,241 59 29,769 54 Brent 203,928 42 -18,920 86 15,734 15 3,186 52 Heating Oil 347,383 30 15,683 65 -43,137 25 27,454 93 Soybeans 796,285 44 193,373 78 -155,577 29 -37,796 9 Corn 1,568,959 33 455,220 88 -407,663 14 -47,557 16 Coffee 274,865 40 61,378 93 -65,365 9 3,987 16 Sugar 897,035 17 93,593 56 -117,500 46 23,907 37 Wheat 391,162 29 350 47 5,100 46 -5,450 76 Gold Comex Futures: The Gold Comex Futures large speculator standing this week equaled a net position of 172,142 contracts in the data reported through Tuesday. This was a weekly decrease of -48,009 contracts from the previous week which had a total of 220,151 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 42.6 percent. The commercials are Bullish with a score of 56.1 percent and the small traders (not shown in chart) are Bearish with a score of 47.1 percent. Gold Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 53.6 24.8 9.1 – Percent of Open Interest Shorts: 20.2 63.8 3.4 – Net Position: 172,142 -201,342 29,200 – Gross Longs: 275,994 127,633 46,819 – Gross Shorts: 103,852 328,975 17,619 – Long to Short Ratio: 2.7 to 1 0.4 to 1 2.7 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 42.6 56.1 47.1 – Strength Index Reading (3 Year Range): Bearish Bullish Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: -10.6 10.6 -2.9 Silver Comex Futures: The Silver Comex Futures large speculator standing this week equaled a net position of 22,118 contracts in the data reported through Tuesday. This was a weekly decrease of -10,023 contracts from the previous week which had a total of 32,141 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 44.4 percent. The commercials are Bullish with a score of 64.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 19.4 percent. Silver Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 40.7 35.5 16.5 – Percent of Open Interest Shorts: 25.9 59.2 7.7 – Net Position: 22,118 -35,263 13,145 – Gross Longs: 60,723 52,970 24,681 – Gross Shorts: 38,605 88,233 11,536 – Long to Short Ratio: 1.6 to 1 0.6 to 1 2.1 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 44.4 64.3 19.4 – Strength Index Reading (3 Year Range): Bearish Bullish Bearish-Extreme NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 1.2 1.1 -13.6 Copper Grade #1 Futures: The Copper Grade #1 Futures large speculator standing this week equaled a net position of 16,155 contracts in the data reported through Tuesday. This was a weekly decrease of -10,326 contracts from the previous week which had a total of 26,481 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 54.0 percent. The commercials are Bearish with a score of 45.0 percent and the small traders (not shown in chart) are Bullish with a score of 53.6 percent. Copper Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 34.8 42.6 8.3 – Percent of Open Interest Shorts: 26.6 53.2 5.9 – Net Position: 16,155 -21,053 4,898 – Gross Longs: 68,984 84,446 16,522 – Gross Shorts: 52,829 105,499 11,624 – Long to Short Ratio: 1.3 to 1 0.8 to 1 1.4 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 54.0 45.0 53.6 – Strength Index Reading (3 Year Range): Bullish Bearish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 8.4 -7.7 -2.6 Platinum Futures: The Platinum Futures large speculator standing this week equaled a net position of 14,581 contracts in the data reported through Tuesday. This was a weekly increase of 789 contracts from the previous week which had a total of 13,792 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 23.4 percent. The commercials are Bullish-Extreme with a score of 80.7 percent and the small traders (not shown in chart) are Bearish with a score of 34.6 percent. Platinum Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 52.3 30.2 14.9 – Percent of Open Interest Shorts: 25.2 66.9 5.2 – Net Position: 14,581 -19,786 5,205 – Gross Longs: 28,171 16,293 8,031 – Gross Shorts: 13,590 36,079 2,826 – Long to Short Ratio: 2.1 to 1 0.5 to 1 2.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 23.4 80.7 34.6 – Strength Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 19.2 -17.3 -17.4 Palladium Futures: The Palladium Futures large speculator standing this week equaled a net position of -992 contracts in the data reported through Tuesday. This was a weekly gain of 996 contracts from the previous week which had a total of -1,988 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 15.2 percent. The commercials are Bullish-Extreme with a score of 83.1 percent and the small traders (not shown in chart) are Bearish with a score of 46.2 percent. Palladium Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 27.7 50.2 16.4 – Percent of Open Interest Shorts: 40.3 37.9 16.1 – Net Position: -992 965 27 – Gross Longs: 2,172 3,943 1,291 – Gross Shorts: 3,164 2,978 1,264 – Long to Short Ratio: 0.7 to 1 1.3 to 1 1.0 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 15.2 83.1 46.2 – Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 14.5 -16.2 22.0 Article By InvestMacro – Receive our weekly COT Reports by Email *COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting).See CFTC criteria here.

COT Metals Speculators cut their Gold bullish bets by most in past 146 weeks

Invest Macro 05.02.2022 17:44

By InvestMacro | COT | Data Tables | COT Leaders | Downloads | COT Newsletter Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC). The latest COT data is updated through Tuesday February 1st and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets. Highlighting the COT metals data is this week’s sharp decline in the Gold futures bets. The speculative net position in the Gold futures dropped by -48,009 contracts this week, marking the largest one-week decline in the past one-hundred and forty-six weeks, dating back to April 16th of 2019 when speculator bets fell by -49,091 contracts. The steep drop this week knocked the current speculator standing down to the lowest level since September 28th. Gold prices have been consolidating in a triangle pattern right around the major support/resistance level of $1800. Joining Gold (-48,009 contracts) in falling this week were Silver (-10,023 contracts) and Copper (-10,326 contracts) while Platinum (789 contracts) and Palladium (996 contracts) had position rises this week. Data Snapshot of Commodity Market Traders | Columns Legend Feb-01-2022 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index WTI Crude 2,093,735 35 368,904 27 -414,658 63 45,754 79 Gold 515,331 23 172,142 43 -201,342 56 29,200 47 Silver 149,136 15 22,118 44 -35,263 64 13,145 19 Copper 198,437 25 16,155 54 -21,053 45 4,898 54 Palladium 7,853 6 -992 15 965 83 27 46 Platinum 53,898 11 14,581 23 -19,786 81 5,205 35 Natural Gas 1,162,813 12 -120,010 43 90,241 59 29,769 54 Brent 203,928 42 -18,920 86 15,734 15 3,186 52 Heating Oil 347,383 30 15,683 65 -43,137 25 27,454 93 Soybeans 796,285 44 193,373 78 -155,577 29 -37,796 9 Corn 1,568,959 33 455,220 88 -407,663 14 -47,557 16 Coffee 274,865 40 61,378 93 -65,365 9 3,987 16 Sugar 897,035 17 93,593 56 -117,500 46 23,907 37 Wheat 391,162 29 350 47 5,100 46 -5,450 76 Gold Comex Futures: The Gold Comex Futures large speculator standing this week equaled a net position of 172,142 contracts in the data reported through Tuesday. This was a weekly decrease of -48,009 contracts from the previous week which had a total of 220,151 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 42.6 percent. The commercials are Bullish with a score of 56.1 percent and the small traders (not shown in chart) are Bearish with a score of 47.1 percent. Gold Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 53.6 24.8 9.1 – Percent of Open Interest Shorts: 20.2 63.8 3.4 – Net Position: 172,142 -201,342 29,200 – Gross Longs: 275,994 127,633 46,819 – Gross Shorts: 103,852 328,975 17,619 – Long to Short Ratio: 2.7 to 1 0.4 to 1 2.7 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 42.6 56.1 47.1 – Strength Index Reading (3 Year Range): Bearish Bullish Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: -10.6 10.6 -2.9 Silver Comex Futures: The Silver Comex Futures large speculator standing this week equaled a net position of 22,118 contracts in the data reported through Tuesday. This was a weekly decrease of -10,023 contracts from the previous week which had a total of 32,141 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 44.4 percent. The commercials are Bullish with a score of 64.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 19.4 percent. Silver Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 40.7 35.5 16.5 – Percent of Open Interest Shorts: 25.9 59.2 7.7 – Net Position: 22,118 -35,263 13,145 – Gross Longs: 60,723 52,970 24,681 – Gross Shorts: 38,605 88,233 11,536 – Long to Short Ratio: 1.6 to 1 0.6 to 1 2.1 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 44.4 64.3 19.4 – Strength Index Reading (3 Year Range): Bearish Bullish Bearish-Extreme NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 1.2 1.1 -13.6 Copper Grade #1 Futures: The Copper Grade #1 Futures large speculator standing this week equaled a net position of 16,155 contracts in the data reported through Tuesday. This was a weekly decrease of -10,326 contracts from the previous week which had a total of 26,481 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 54.0 percent. The commercials are Bearish with a score of 45.0 percent and the small traders (not shown in chart) are Bullish with a score of 53.6 percent. Copper Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 34.8 42.6 8.3 – Percent of Open Interest Shorts: 26.6 53.2 5.9 – Net Position: 16,155 -21,053 4,898 – Gross Longs: 68,984 84,446 16,522 – Gross Shorts: 52,829 105,499 11,624 – Long to Short Ratio: 1.3 to 1 0.8 to 1 1.4 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 54.0 45.0 53.6 – Strength Index Reading (3 Year Range): Bullish Bearish Bullish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 8.4 -7.7 -2.6 Platinum Futures: The Platinum Futures large speculator standing this week equaled a net position of 14,581 contracts in the data reported through Tuesday. This was a weekly increase of 789 contracts from the previous week which had a total of 13,792 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 23.4 percent. The commercials are Bullish-Extreme with a score of 80.7 percent and the small traders (not shown in chart) are Bearish with a score of 34.6 percent. Platinum Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 52.3 30.2 14.9 – Percent of Open Interest Shorts: 25.2 66.9 5.2 – Net Position: 14,581 -19,786 5,205 – Gross Longs: 28,171 16,293 8,031 – Gross Shorts: 13,590 36,079 2,826 – Long to Short Ratio: 2.1 to 1 0.5 to 1 2.8 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 23.4 80.7 34.6 – Strength Index Reading (3 Year Range): Bearish Bullish-Extreme Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 19.2 -17.3 -17.4 Palladium Futures: The Palladium Futures large speculator standing this week equaled a net position of -992 contracts in the data reported through Tuesday. This was a weekly gain of 996 contracts from the previous week which had a total of -1,988 net contracts. This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 15.2 percent. The commercials are Bullish-Extreme with a score of 83.1 percent and the small traders (not shown in chart) are Bearish with a score of 46.2 percent. Palladium Futures Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 27.7 50.2 16.4 – Percent of Open Interest Shorts: 40.3 37.9 16.1 – Net Position: -992 965 27 – Gross Longs: 2,172 3,943 1,291 – Gross Shorts: 3,164 2,978 1,264 – Long to Short Ratio: 0.7 to 1 1.3 to 1 1.0 to 1 NET POSITION TREND: – Strength Index Score (3 Year Range Pct): 15.2 83.1 46.2 – Strength Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish NET POSITION MOVEMENT INDEX: – 6-Week Change in Strength Index: 14.5 -16.2 22.0 Article By InvestMacro – Receive our weekly COT Reports by Email *COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting).See CFTC criteria here.

COT Bonds Speculators raise their 2-Year Treasury bullish bets

Invest Macro 05.02.2022 18:24

COT Bonds Speculators raise their 2-Year Treasury bullish bets - 06.02.2022

Invest Macro 05.02.2022 18:24

COT Forex Speculators reduce their US Dollar bullish bets to 7-week low

Invest Macro 05.02.2022 20:24

COT Forex Speculators reduce their US Dollar bullish bets to 7-week low - 06.02.2022

Invest Macro 05.02.2022 20:24

Bitcoin Hovered Around Ca. $44k Yesterday, Ether (ETH) Gains 5%, Solana Increases by 4%, Ripple by 18.5%

Alex Kuptsikevich 08.02.2022 08:31

On Monday, Bitcoin rose 5.5%, ending the day around $44,100. Ethereum added 5%, and other leading altcoins from the top ten also showed growing dynamics: from 4% (Solana) to 18.5% (XRP). The total capitalization of the crypto market increased by 5.5% over the day to $2.10 trillion. The Bitcoin dominance index has not changed, remaining at 39.2%. The Bitcoin chart continues to paint a bullish picture. With the price at $45K on Tuesday morning, BTCUSD is trading above the 50-day moving average just above the mid-January pivot area and above the down channel resistance level. At the same time, the RSI on the daily charts has not yet entered the overbought area, leaving room for further growth. The same can be said about the entire cryptocurrency market, where the fear and greed index has reached a neutral point of 48 and is still far from the greed area. The next target for the bulls looks to be $48K, the December support area in December. Further targets are $49-50K, where the 200-day moving average and significant round level are concentrated. The XRP token soared amid reports of a significant approach to the resolution of Ripple's legal dispute with the US Securities and Exchange Commission (SEC).Cryptocurrencies briefly stopped responding to movements in US stock indices, which started the week with a decline. The purchases probably included retail investors, who were driven by the desire not to miss the beginning of the market growth (FOMO). However, their buying potential is unlikely to be enough if stock indicators intensify their decline and large institutional investors come into play, wishing to resume profit-taking. KPMG, one of the world's largest auditors, has added Bitcoin and Ethereum to its Canadian division's corporate reserves. This is the firm's first direct investment in cryptocurrencies. Meanwhile, at the end of 2021, Tesla received a loss of $ 101 million from a decrease in the cost of previously purchased bitcoins, which it spent $ 1.5 billion on. Previously, Elon Musk called the decision to acquire BTC as a reserve asset quite risky.

Are You Thinking the Dollar Will Collapse? That’s False Hope

Przemysław Radomski 07.02.2022 15:49

Gold’s latest feats increased investors’ appetite. The outlook for the dollar, however, remains healthy. That can only mean one thing. As volatility erupts across the financial markets, gold and silver prices are being pulled in conflicting directions. For example, with the USD Index suffering a short-term decline, the outcome is fundamentally bullish for the precious metals. However, with U.S. Treasury yields rallying, the outcome is fundamentally bearish for gold and silver prices. Then, with panic selling and panic buying confronting the general stock market, the PMs are dealing with those crosscurrents. However, with QE on its deathbed and the Fed poised to raise the Federal Funds Rate in the coming months, the common denominator is rising real interest rates. To explain, the euro’s recent popularity has impacted the USD Index. For context, the EUR/USD accounts for nearly 58% of the dollar basket’s movement. Thus, if real interest rates rise and the U.S. dollar falls, what will happen to the PMs? Well, the reality is that rising real interest rates are bullish for the USD Index, and the euro’s recent ECB-induced rally is far from a surprise. With investors often buying the EUR/USD in anticipation of a hawkish shift from the ECB, another ‘hopeful’ upswing occurred. However, the central bank disappointed investors time and time again in 2021, and the currency pair continued to make new lows. As a result, we expect the downtrend to resume over the medium term. Supporting our expectations, I wrote the following about financial conditions and the USD Index on Feb. 2: To explain, the blue line above tracks Goldman Sachs' Financial Conditions Index (FCI). For context, the index is calculated as a "weighted average of riskless interest rates, the exchange rate, equity valuations, and credit spreads, with weights that correspond to the direct impact of each variable on GDP." In a nutshell: when interest rates increase alongside credit spreads, it's more expensive to borrow money and financial conditions tighten. To that point, if you analyze the right side of the chart, you can see that the FCI has surpassed its pre-COVID-19 high (January 2020). Moreover, the FCI bottomed in January 2021 and has been seeking higher ground ever since. In the process, it's no coincidence that the PMs have suffered mightily since January 2021. To that point, with the Fed poised to raise interest rates at its March monetary policy meeting, the FCI should continue its ascent. As a result, the PMs' relief rallies should fall flat like in 2021. Likewise, while the USD Index has come down from its recent high, it's no coincidence that the dollar basket bottomed with the FCI in January 2021 and hit a new high with the FCI in January 2022. Thus, while the recent consolidation may seem troubling, the medium-term fundamentals supporting the greenback remain robust. Furthermore, tighter financial conditions are often a function of rising real interest rates. As mentioned, the USD Index bottomed with the FCI and surged to new highs with the FCI. As a result, the fundamentals support a stronger, not weaker USD Index. As evidence, the U.S. 10-Year real yield, the FCI, and the USD Index have traveled similar paths since January 2020. Please see below: To explain, the green line above tracks the USD Index since January 2020, while the red line above tracks the U.S. 10-Year real yield. While the latter didn’t bottom in January 2021 like the USD Index and the FCI (though it was close), all three surged in late 2021 and hit new highs in 2022. Moreover, the U.S. 10-Year Treasury nominal and real yields hit new 2022 highs on Feb. 4. In addition, if you compare the two charts, you can see that all three metrics spiked higher when the coronavirus crisis struck in March 2020. As such, the trio often follows in each other’s footsteps. Furthermore, with the Fed likely to raise interest rates at its March monetary policy meeting, this realization supports a higher U.S. 10-Year real yield, and a higher FCI. As a result, the fundamentals underpinning the USD Index remain robust, and short-term sentiment is likely to be responsible for the recent weakness. Likewise, as the Omicron variant slows U.S. economic activity, the ‘bad news is good news’ camp has renewed hopes for a dovish Fed. However, the latest strain is unlikely to affect the Fed’s reaction function. A case in point: after ADP’s private payrolls declined by 301,000 in January (data released on Feb. 2), concern spread across Wall Street. However, after U.S. nonfarm payrolls (government data) came in at 467,000 versus 150,000 expected on Feb. 4, the U.S. labor market remains extremely healthy. Please see below: Source: U.S. Bureau of Labor Statistics (BLS) On top of that, the BLS revealed that “the over-the-month employment change for November and December 2021 combined is 709,000 higher than previously reported, while the over-the-month employment change for June and July 2021 combined is 807,000 lower. Overall, the 2021 over-the-year change is 217,000 higher than previously reported.” Thus, the U.S. added more than 700,000 combined jobs in November and December than previously reported, and the net gain in 2021 was more than 200,000. Please see below: Source: BLS As for wage inflation, the BLS also revealed: “In January, average hourly earnings for all employees on private nonfarm payrolls increased by 23 cents to $31.63. Over the past 12 months, average hourly earnings have increased by 5.7 percent.” As a reminder, while investors speculate on the prospect of a hawkish ECB, the latest release out of Europe shows that wage inflation is much weaker than in the U.S. To explain, I wrote on Feb. 1: Eurozone hourly labor costs rose by 2.5% YoY on Dec. 16 (the latest release). Moreover, the report revealed that “the costs of wages & salaries per hour worked increased by 2.3%, while the non-wage component rose by 3.0% in the third quarter of 2021, compared with the same quarter of the previous year.” As a result, non-wage labor costs – like insurance, healthcare, unemployment premiums, etc. – did the bulk of the heavy lifting. In contrast, wage and salary inflation are nowhere near the ECB’s danger zone. Please see below: And why is wage inflation so critical? Well, ECB Chief Economist Philip Lane said on Jan. 25: Source: ECB As a result, when the ECB’s Chief Economist tells you that wage inflation needs to hit 3% YoY to be “consistent” with the ECB’s 2% overall annual inflation target, a wage print of 2.3% YoY is far from troublesome. Thus, while euro bulls hope that the ECB will mirror the Fed and perform a hawkish 180, the data suggests otherwise. In addition, while U.S. nonfarm payrolls materially outperformed on Feb. 4, I noted on Feb. 2 that there are now 4.606 million more job openings in the U.S. than citizens unemployed. Please see below: To explain, the green line above subtracts the number of unemployed U.S. citizens from the number of U.S. job openings. If you analyze the right side of the chart, you can see that the epic collapse has completely reversed and the green line is now at an all-time high. Thus, with more jobs available than people looking for work, the economic environment supports normalization by the Fed. Thus, if we piece the puzzle together, the U.S. labor market remains healthy and U.S. inflation is materially outperforming the Eurozone. As a result, the Fed should stay ahead of the ECB, and the hawkish outperformance supports a weaker EUR/USD and a stronger USD Index. Moreover, the dynamic also supports a higher FCI and a higher U.S. 10-Year real yield. As we’ve seen since January 2021, these fundamental outcomes are extremely unkind to the PMs. Finally, while the Omicron variant has depressed economic sentiment, I noted previously that the disruptions should be short-lived. For example, with Americans’ anxiety about COVID-19 decelerating, renewed economic strength should keep the pressure on the Fed. Please see below: To explain, the light brown line above tracks the net percentage of Americans concerned about COVID-19, while the dark brown line above tracks the change in flight search trends on Kayak. In a nutshell: the more concern over COVID-19 (a high light brown line), the more Americans hunker down and avoid travel (a low dark brown line). However, if you analyze the right side of the chart, you can see that the light brown line has rolled over and the dark brown line has materially risen. Moreover, with the trend poised to persist as the warmer weather arrives, increased mobility should uplift sentiment, support economic growth, and keep the Fed’s rate hike cycle on schedule. The bottom line? The USD Index’s fundamentals remain extremely healthy, and while short-term sentiment has been unkind, rising real yields and a hawkish Fed should remain supportive over the medium term. Moreover, with the PMs often moving inversely to the U.S. dollar, more downside should confront gold, silver, and mining stocks over the next few months. In conclusion, the PMs rallied on Feb. 4, despite the spike in U.S. Treasury yields. However, with so much volatility confronting the general stock market recently, sentiment has pulled the PMs in many directions. However, the important point is that the medium-term thesis remains intact: the USD Index and U.S. Treasury yields should seek higher ground, and the realization is profoundly bearish for the precious metals sector. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Will Sandbox (SAND) Reach $5 In The Near Future?

FXStreet News 08.02.2022 16:08

Sandbox price action has broken above $4.72 but fades in early trading today. SAND price action is at the intersection of a red descending trend line and the historical pivot level. Expect current favourable tailwinds to boost confidence for bulls leading to a break to the upside and new all-time highs. Sandbox (SAND) price action broke above $4.72 yesterday and saw bulls trying to test $5.0. But the intersection of the descending trend line and a pivot level proved to be too heavy and pushed price action back below the $4.72 historical level. Expect bulls to keep supporting as more tailwinds coming from geopolitics support the case for more upside potential towards $6.0. Sandbox price targets $6 for this week Sandbox price looked set to finally end the downtrend since November 25. The intersection of the red descending trend line dictating the downtrend and the historical $4.72 pivotal historic level from November 23, proved too big of a hurdle for price action to close above yesterday. Instead, bulls decided to take profit with price fading as we speak. SAND does not need to one-directionally tank further but will probably see bulls keeping price close to the pivotal $4.72 level. With several favorable tailwinds, such as positive news from talks between Putin and Macron, investors look to be back on the scene and putting some money on the table to invest in risk assets like cryptocurrencies. This will filter through in the demand side volume and will provide the needed impetus to punch through $4.72 again and close above, putting an end to the downtrend and targeting $6.0 this week. SAND/USD daily chart The resistance double whammy at the aforementioned intersection could prove too big of a temptation for profit-taking, and result in the Relative Strength Index dipping further, below 50, and translate into further downside for the altcoin towards $4.28, making it even harder to try for a daily close above $4.72. That could lead to yet more liquidation and see a return to a base level around $3.50.

STX, RJF and BX were added to our Stock Market Watchlist in January

Invest Macro 09.02.2022 22:39

The first quarter of 2022 is underway and it is time to highlight some of the top companies that have been analyzed by our QuantStock Fundamental system so far. Topping the list are three well-known companies, one in technology and two from the financial services side of the market with all three companies paying out dividends to investors. Our QuantStock Fundamental system is a proprietary algorithm that examines each company’s fundamental metrics, trends and overall strength to pinpoint quality companies. We use it as a stock market ideas generator and to update our stock watchlist every quarter. However, be aware the QuantStock Fundamental system does not take into consideration the stock price or technical price trends so one must compare each idea with their current stock prices. Many studies are consistently showing overvalued markets and that always has to be taken into consideration with any stock market idea. As with all investment ideas, past performance does not guarantee future results. Be sure to join our email newsletter for our system updates. Here we go with our 3 of our Top Stocks we added to our Watchlist from January 1st through January 31st of 2022: Seagate Technology Information Technology, Medium Cap, 13.8 P/E, 2.50+ Percent Dividend, Our Grade = B Seagate Technology (STX) has ascended our grading threshold to be included on the watchlist for the second consecutive quarter. STX is an information technology company headquartered in Ireland that specializes in technology hardware, storage devices and other cloud storage services. Highlighting their fundamental case over the past two quarters has been a rising earning per share (beating expectations three quarters in a row) as well as a rising dividend that is currently above 2.50 percent. On a technical basis, the STX price has been volatile since the beginning of the year like most other tech stocks. STX hit a low share price under $92.00 on January 25th but has rallied since to over $110.00 per share at time of writing. Raymond James Financial Inc Financials, Medium Cap, 15.84 P/E, 1.15+ Percent Dividend, Our Grade = B- Raymond James Financial INC (RJF) is next up and a well known financial company that has also made our watchlist for the second straight quarter. RJF, a medium-cap company ($28+ billion) is headquartered in Florida and provides financial services to investors and corporations throughout the US, Canada and Europe. RJF currently trades at an approximate 15.5 PE-Ratio and has had higher earnings per share for three straight quarters, beating earnings per share expectations in all three quarters as well. The dividend has continued on a growth path with the current quarterly dividend at approximately 1.15 percent at time of writing. Technically, the RJF share price has been surging higher recently and currently trading around the $115.00 price point at time of writing. In the short term, the stock is on the higher side of its trading range as evidenced by the ZScore of the 50-day moving average (2.38 standard deviations above the 50-day moving average currently). Blackstone Inc Financials, Large Cap, 15.8 P/E, 3.80+ Percent Dividend, Our Grade = C Blackstone Inc (BX) was added to our watchlist for the first time in January and is a financial large cap company ($154+ billion) located in New York, New York. BX provides global asset management services to investors, pension funds and institutional clients across a broad range of markets including real estate, bonds, equities and various credits. Blackstone’s stock is currently trading at a 15.8 Price/Earnings Ratio and the company has had earnings per share growth each of the past three quarters, beating expectations each time. The dividend has been on an upward trajectory with the current yield surpassing the 3.80 percent threshold at current prices. Technically, the BX share price has been on the rebound recently after dropping in late January to a low of $101.65. The stock has bounced back strong to a current price of above $130.00 per share and trading right above a support level. Article by InvestMacro – Be sure to join our stock market newsletter to get our updates and to see more top companies we add to our stock watch list. Disclaimer: I currently own STX, RJF and BX stock at this time in ETFs and/or Closed-End Funds. I do not own direct shares of these companies at time of writing. This article and our system grading are for informational and educational purposes only, not a recommendation to buy, sell or hold shares of any particular stock, ETF, company or security. All investors are always strongly advised to conduct their own independent research into any stock, ETF, closed-end fund or any other financial instrument before making an investment decision. Investmacro.com authors are not registered investment advisors, do not make stock market recommendations, do not offer legal advice, do not offer tax advice and cannot be held liable for any losses occurred. All data is thought to be accurate as of time of writing but can and will change over time due to changes in the underlying securities price and data.

What Will US CPI Trigger And How Will Fed Deal With It?

Walid Koudmani 10.02.2022 12:32

Inflation has been a key topic in the markets in recent times with several readings reaching the highest levels in decades and central banks trying to find a balance between adjusting their monetary and fiscal policy while stimulating the post pandemic economic recovery. One of the consequences of these policies has been a staggering increase in prices of most goods, which has become a serious issue of concern for central bankers as well as regular consumers who have seen their everyday expenses increase noticeably. Today’s CPI and Core CPI readings from the US could be highly impactful as they may dictate whether the Federal reserve will decide to take action in the upcoming meeting since as of now, five rate hikes are expected and several other central banks have already taken measures to contrast general inflation. Clearly there is a fine balance between sustaining the economy and exacerbating widespread inflation which may ultimately hinder stability across markets and today’s report could play a crucial role in that process of analysis. The US Dollar may react favorably to a higher than expected reading as it could almost seal the deal on an upcoming rate hike, while stocks could be impacted by prospects of less liquidity. Watches of Switzerland report paints optimistic picture Watches of Switzerland's report showed a continued growth of its revenue and return on capital with significant gain in market share as the company plans to continue investing for growth and to enhance its leading position in the UK and as it attempts to become a clear leader in the US. The easing of restrictions and improving economic conditions have certainly helped but with potential supply issues and record inflation levels, we could be seeing a slowdown in the short-mid term if these issues are not approached carefully. Astrazeneca posts strong results but remains cautious Astrazeneca's results showed a total revenue increase of 41% to $37,417m including COVID-19 vaccine revenues. The company managed to achieve 14 positive Phase 3 readouts across nine medicines in 2021, and 22 regulatory approvals and authorisations in major markets which further boosted its market dominance in the field. Furthermore, the company expects CER of a high-teens percentage increase in total revenue and a mid-to-high twenties percentage increase in Core EPS for 2022. Despite this, while it will certainly benefit from a variety of innovations it provides, it may see a decline in its profits as revenue from vaccines potentially declines throughout the mid to long term.

The Question Is How Will Price Of Gold Act In Times Of ECB Meeting

Arkadiusz Sieron 10.02.2022 16:22

Lagarde opened the door to an interest rate hike, which gave the European Central Bank a hawkish demeanor. Does it also imply more bullish gold? The ECB has awoken from its ultra-dovish lethargy. In December 2021, the central bank of the Eurozone announced that its Pandemic Emergency Purchase Program would end in March 2022. Although this won’t also mean the end of quantitative easing as the ECB continues to buy assets under the APP program, the central bank will be scaling down the pace of purchases this year. Christine Lagarde, the ECB’s President, admitted it during her press conference held last week. She said: “We will stop the Pandemic Emergency Programme net asset purchases in March and then we will look at the net asset purchases under the APP.” She also left the door open for the interest rates to be raised. Of course, Lagarde did not directly signal the rate hikes. Instead, she pointed out the upside risk of inflation and acknowledged that the macroeconomic conditions have changed: We are going to use all instruments, all optionalities in order to respond to the situation – but the situation has indeed changed. You will have noticed that in the monetary policy statement that I just read, we do refer to the upside risk to inflation in our projection. So the situation having changed, we need to continue to monitor it very carefully. We need to assess the situation on the basis of the data, and then we will have to take a judgement. What’s more, Lagarde didn’t repeat her December phrase that raising interest rates in 2022 is “very unlikely”. When asked about that, she replied: as I said, I don’t make pledges without conditionalities and I did make those statements at our last press conference on the basis of the assessment, on the basis of the data that we had. It was, as all pledges of that nature, conditional. So what I am saying here now is that come March, when we have additional data, when we’ve been able to integrate in our analytical work the numbers that we have received in the last few days, we will be in a position to make a thorough assessment again on the basis of data. I cannot prejudge what that will be, but we are only a few weeks away from the closing time at which we provide the analytical work, prepare the projections for the Governing Council, and then come with some recommendations and make our decisions. It sounds very innocent, but it’s worth remembering that Lagarde is probably the most dovish central banker in the world (let’s exclude Turkish central bankers who cut interest rates amid high inflation, but they are under political pressure from Erdogan). After all, global monetary policy is tightening. For example, last week, the Bank of England hiked its main policy rate by 25 basis points and started quantitative tightening. Even the Fed will probably end quantitative easing and start raising the federal funds rate in March. In such a company, the ECB seems to be a reckless laggard. Hence, even very shy comments mean something in the case of this central bank. The markets were so impressed that they started to price in 50 basis points of rate hikes this year, probably in an exaggerated reaction. Implications for Gold What does the latest ECB monetary policy meeting mean for the gold market? Well, maybe it wasn’t an outright revolution, but the ECB is slowly reducing its massive monetary stimulus. Although the euro area does not face the inflationary pressure of the same kind as the US, with inflation that soared to 5% in December and to 5.1% in January (according to the initial estimate), the ECB simply has no choice. As the chart below shows, inflation in the Eurozone is the highest in the whole history of euro. Additionally, in the last quarter of 2021, the GDP of the euro area finally reached its pre-pandemic level, two quarters later than in the case of the US. Europe is back in the game. The economic recovery strengthens the hawkish camp within the ECB. All of this is fundamentally bullish for gold prices. To be clear, don’t expect that Christine Lagarde will turn into Paul Volcker and hike interest rates in a rush. Given the structural problems of the euro area, the ECB will lag behind the Fed and remain relatively more dovish. However, German bond yields have recently risen, and there is still room for further increases. If the market interest rates go up more in Europe than across the pond, which is likely given the financial tightening that has already occurred in the US, the spread between American and German interest rates could narrow further (see the chart below). The narrowing divergence between monetary policies and interest rates in the US and in the Eurozone should strengthen the euro against the greenback – and it should be supportive of gold. As the chart above shows, when the spread was widening in 2012-2018, gold was in the bear market. The yellow metal started its rally at the end of 2018, just around the peak of the spread. On the other hand, if the divergence intensifies, gold will suffer. Given that Powell is expected to hike rates as soon as March, while Lagarde may only start thinking about the tightening cycle, we may have to wait a while for the spread to peak. One thing is certain: it can get hot in March! If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Bear Came And Drove Out Gold Enthusiasts, Will Silver Decrease As Well?

Przemysław Radomski 10.02.2022 15:14

The market was up, but mining stocks chose to reverse. Meanwhile, gold sent a clear signal to investors. So, when everyone buys, what happens? The gold mining stocks and silver mining stocks have reversed, even though gold didn’t. The top for the former is likely in. Most developments regarding the precious metals and their immediate surroundings were a continuation of what we had seen in the previous days, but one thing was different. That one thing is particularly informative. It has trading implications, too. Without further ado, let’s jump into mining stocks. Gold miners fell. Even though they declined by just $0.06, it was profound. The miners were following gold higher during the early part of yesterday’s (Feb. 9) session, but they lost strength close to the middle thereof and were back down before the closing bell. If the gold price reversed and then declined during the day, that would have been normal. However, gold stayed up. It’s fairer to compare GDX to GLD than to compare GDX to gold continuous futures contracts, as the former have the same closing hours, so let’s take a look at what GLD did yesterday. There was no reversal. GLD simply stopped at its declining medium-term resistance line. Also, the general stock market was up yesterday. Consequently, gold mining stocks had no good reason to decline. In fact, they “should have” rallied. They didn’t – they reversed instead. This tells us that the buying power has either dried up or is drying up. When everyone who wanted to get into the market is already in it, the price can do only one thing (regardless of bullish factors) – fall. Those who are already in can then sell. Monitoring the markets for this kind of cross-sector performance is one of the more important gold trading tips. Look, I’m not saying that declines now are “guaranteed”. There are no guarantees in the markets. There might be buyers that haven’t considered mining stocks that would now enter the market, but history tells us that this is unlikely. Instead, declines are very likely to follow. Let’s focus on the GLD ETF chart one more time. As I wrote earlier, it approached its declining medium-term resistance line. Any small breakout here is likely to be invalidated just like what we saw previously in November 2021 and January 2022. This time, however, the volume is low, so gold might not have enough strength for a breakout, and it could decline right away. Junior mining stocks provide us with a perfect confirmation of the bearish narrative. I emphasized before that juniors hadn’t moved above their 50-day moving average, and that they stayed below their rising blue resistance line. Consequently – I wrote – the downtrend in them remained clearly intact. Yesterday’s reversal served as a perfect confirmation of the above. The previous breakdowns were verified in one of the most classic ways. The silver price has been quite strong recently, which is also something that we see close to the local tops. The reversals in mining stocks, the situation in gold, AND the situation in the USD Index together paint a very bearish picture for the precious metals market in the short and medium term. By “the situation in the USD Index”, I’m referring to the fact that it’s after its early-month reversal and right above its rising medium-term support line that was not successfully broken. Since the USD Index remains above its rising medium-term support line, the trend remains up. Therefore, higher – not lower – USD Index values are to be expected. All in all, it seems that gold, silver, and mining stocks are going to decline in the coming weeks (quite possibly days) and that we won’t have to wait too long for the next big decline to start. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

COT Soft Commodities Speculators push Soybeans bullish bets higher for 9th time in 10 weeks

Invest Macro 12.02.2022 17:00

COT Energy Speculators drop their Heating Oil bullish bets to 6-week low

Invest Macro 12.02.2022 17:02

COT Metals Speculators raise Copper bullish bets for 5th time in 7 weeks

Invest Macro 12.02.2022 17:05

COT Bonds Speculators drop 10-Year Treasury bearish bets to 15-week low

Invest Macro 12.02.2022 17:28

COT Currency Speculator’s bullish bets for Brazilian Real jump by most on record - 12.02.2022

Invest Macro 12.02.2022 18:28

Price Of Gold Hitting $2.000? Metal Seems To Feel Good

Florian Grummes 14.02.2022 07:34

Given last week’s strong price action and gold’s intraday resilience, it is now very likely that gold indeed is breaking out of the multi-month consolidation triangle. Actually, this large and symmetrical triangle had been building for more than a year, at least. However, the correction in gold began on August 7th, 2020. Now it looks like the breakout is in process. Typically, traders tend to aggressively buy into such a breakout. And given Friday’s sharp spike higher, it actually looks exactly like this. Hence, expect more volatility and a sharp move higher as the direction of gold’s next move has become more obvious. Please note, that it is rather challenging to draw and determine the correct triangle, because gold has been in a tricky sideways market for such a long time and many trend-lines have been invalidated during this messy period. But at the latest, a weekly close above US$1,875 should confirm the breakout. This should unleash enough energy to push gold prices quickly towards US$1,900 and even US$1,950 within a few weeks. Obviously, that would fit very well with gold’s seasonal cycle, which is bullish until the end of February at least, but often saw gold rallying into mid of march, too. Consumer sentiment at 10-year low but Fed wants to hike and taper From a fundamental perspective, it leaves us speechless how the Fed can go on a hiking rampage while consumer sentiment is at a 10-year low. While the confidence in governments worldwide is collapsing and inflation is spiking higher, raising rates will have zero impact upon supply shortages. Instead, it will make these shortages only worse and bankrupt more companies in the supply chain. Also, it will bankrupt emerging markets, as the strong dollar has already been putting so much pressure on dollar indebted nations and creditors. It’s all a big mess, and we believe there is no way out. That’s why the warmongering industrial and military complex of the US is desperately trying to push Russia into an attack on Ukraine! Without showing any proof, the Biden administration and their mouthpiece “the mainstream media” have been pushing people’s focus on fears that Russia will soon invade Ukraine. Another noteworthy fundamental observation: Gold’s correction began in earnest when Pfizer & Biontech announced their vaccine on November 9th, 2020. In a first reaction, gold immediately sold off $150 on that same day. Many more similar large red daily candles followed over the last 16 months, destroying the confidence of the gold bugs and shifting millions of dollars to the short sellers. Now that more and more very serious questions about the vaccines are debated in the news, it would make sense for gold to run back to US$1,950. This was the level where gold was trading back on November 9th, 2020. Gold in US-Dollar, weekly chart as of February 13th, 2022. Gold in US-Dollar, weekly chart as of February 13th, 2022. On the weekly chart, gold has been slowly but surely progressing into the apex of the triangle over the last few months. It now looks like Gold is breaking out with vengeance. Theoretically, the resistance zone between US$1,850 and US$1,875 could still stop the bullish train. The weekly Bollinger Bands (US$1,864) sits right in this zone and should at least challenge the bulls for some days. However, the weekly stochastic has just given a new buy signal. On top, the oscillator has been making higher lows since March 2021. A measured move out of this triangle could take gold to around US$1,950 to US$1.975 until spring. The monthly Bollinger Band ($1,975) could become the logical target! Overall, the weekly chart is becoming more and more bullish, suggesting that gold can at least move around US$80 to US$100 higher. Gold in US-Dollar, daily chart as of February 13th, 2022. Gold in US-Dollar, daily chart as of February 13th, 2022. On the daily chart, gold has been struggling with the upper triangle resistance in November and January. Each time, the bears managed to push back. Now it looks like the bulls are finally successful. The fierce and sharp pullback two and half weeks ago had created a nice oversold setup which became the launching pad for the ongoing attack. Since then, the slow stochastic has been nicely turning around. This buy signal is still active and has not yet reached the overbought zone. Thanks to Friday’s big green candle, the bulls are now bending the upper Bollinger Band (US$1,858) to the upside. To conclude, the daily chart is bullish, and gold should have more upside. If the bulls continue their attack, we could see prices directly exploding for four to seven days. More likely would be a consolidation. Only with prices below US$1,835 the breakout would have failed. In that rather unlikely case, the picture could quickly turn ugly again. Conclusion: Gold is breaking out! In mid of December, gold made an important low around US$1,752. Back then, most gold bugs had enough and did throw in the towel after a very difficult and messy 16-month correction. Gold, silver and the mining stock had become the most hated asset. But actually, all that gold might have been doing was building an epic base and a launch pad to start the next leg higher within its bull market. Overall, we expect that Gold is breaking out after a short consolidation! The successful breakout above resistance between US$1,850 and US$1,875 should happen within the next few days or weeks. This should then lead to higher prices and gold will likely run towards US$1,950, at least. However, we are not sure yet whether this will also bring an attack towards the round number resistance at US$2,000. Given the fact, that gold usually starts to struggle somewhere in spring, the ongoing rally could still be just a counter-trend move within the larger ongoing consolidation/correction. Hence, we are short-term very bullish, mid-term neutral and long-term very bullish for gold. Feel free to join us in our free Telegram channel for daily real time data and a great community. If you like to get regular updates on our gold model, precious metals and cryptocurrencies you can also subscribe to our free newsletter. Disclosure: Midas Touch Consulting and members of our team are invested in Reyna Gold Corp. These statements are intended to disclose any conflict of interest. They should not be misconstrued as a recommendation to purchase any share. This article and the content are for informational purposes only and do not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. The views, thoughts and opinions expressed here are the author’s alone. They do not necessarily reflect or represent the views and opinions of Midas Touch Consulting. By Florian Grummes|February 13th, 2022|Tags: Gold, Gold Analysis, Gold bullish, gold chartbook, gold fundamentals, precious metals, Reyna Gold, US-Dollar About the Author: Florian Grummes Florian Grummes is an independent financial analyst, advisor, consultant, trader & investor as well as an international speaker with more than 20 years of experience in financial markets. He is specialized in precious metals, cryptocurrencies and technical analysis. He is publishing weekly gold, silver & cryptocurrency analysis for his numerous international readers. He is also running a large telegram Channel and a Crypto Signal Service. Florian is well known for combining technical, fundamental and sentiment analysis into one accurate conclusion about the markets. Since April 2019 he is chief editor of the cashkurs-gold newsletter focusing on gold and silver mining stocks. Besides all that, Florian is a music producer and composer. Since more than 25 years he has been professionally creating, writing & producing more than 300 songs. He is also running his own record label Cryon Music & Art Productions. His artist name is Florzinho.

In The Beginning Of This Week, The Eastern Tensions Is The #1 Topic

Walid Koudmani 14.02.2022 14:09

The news from US intelligence that the Russian aggression on Ukraine was a done deal spooked markets on Friday. While Russia denied it, the situation doesn't seem to be getting any better. How will markets react to further developments? Prepare for various options Markets are reacting and investors should prepare for potentially turbulent times. This is why we present 3 potential scenarios of the Ukrainian conflict and highlight key markets that may be affected. Watch these markets: Stocks – Russian banks, RTS and… Nasdaq VTB and Sberbank – the names of these institutions are nearly synonymous with sanctions on Russia. Little wonder these stocks are among top choices on the equity side. Investors may also focus on the diversified RTS Index where Sberbank has 14% share – the index has plenty of energy stocks as well and is down 30% from late 2021 highs. A less obvious choice is Nasdaq (US100). Why would US tech stocks react to the conflict in Europe? Well, since this market has its own share of problems (mainly Fed tightening), other bad news could impact investor sentiment even further. Commodities – Oil, Gold, Platinum, Palladium and Wheat Russia is the second largest exporter of Oil and the commodity is also a substitute for natural gas which has already been in tight supply in Europe. Gold has traditionally been a "top pick”for times of geopolitical uncertainty but we'd like to turn your attention to Palladium and Platinum – these are also precious metals but Russia is way more important here being the number 1 and 2 exporter respectively. Finally, both Russia and Ukraine are important producers of Wheat. FX – focus on USDRUB FX is fairly obvious – any conflict is detrimental for the Russian ruble even despite high oil prices and significant interest rate increases in Russia. On the other hand, USD attracts liquidity in times of distress so USDRUB could be the choice for investors here. 3 scenarios – invasion, tension and compromise The worst case scenario is the one of invasion – the one already hinted at by the US intelligence. Invasion means sanctions but actually the lack of sanctions is the key to reactions here (as the largest guns – like cutting off Russia from SWIFT – are supposedly off the table). Markets know that if Russia invades, forcing it to withdraw will be costly and that will feed uncertainty and fear. Critically negative for Russian stocks, negative for global stocks, positive for oil and precious metals and USDRUB. The most likely scenario could be the one of prolonged tension – Moscow can pose threats for as long as it achieves certain results (there’s a talk of autonomy or even referendums in Eastern parts of Ukraine). While politically complicated, this scenario can actually be a relief for the markets. For as long as invasion risk declines, this scenario is positive for stocks while being negative for oil, precious metals and USDRUB. Finally a scenario most would prefer – there's a sound compromise and Russian troops are ordered away from the Ukrainian border. This would be extremely positive for stocks (especially Russian banks and the Russian index) while negative for oil, precious metals and USDRUB. Unfortunately, this scenario also seems to be the least likely. XTB Research

The shopping spree on the investment land market continues

Finance Press Release 14.02.2022 14:32

The battle for investment land is still going on, and the lack of attractive assets feels more and more severe. This applies to all large cities in Poland. For a long time, no matter the place, the investment land has not been easily available. In contrast, there are both plenty of people willing to buy land, as well as free funds to finance these purchases. The money surplus is enormous. Investors are trying to invest their capital in land as soon as possible, for fears of inflation. Although the peak shopping spree, often associated with really risky decisions, has already passed, the situation continues to bear resemblance to the one we remember from the years 2007-2008, when everything was selling like hot cakes, at rapidly rising prices. The appearance of new investors has shortened the sale process of attractive lands, which now usually closes within 3 months. In turn, the difficulty is the highly overestimated value of many plots of land or the unregulated ownership status of the property. The owners of land are also very reluctant to reserve the land through conditional or preliminary purchase agreements without deposit (earnest money). Maximizing profits through investments in land There are many companies willing to invest in land, despite the prices of land in some locations are growing in a blistering pace. The greatest shortage occurs in case of large plots for housing development in well-connected parts of cities. When the interesting plots of up to 5,000 m2 of residential and usage space appear on the market, even several companies compete for it. The larger the plot, the lower the number of competitors. Over the last two years, rates on the investment land market have increased by several dozen percent, depending on the location. Prices for 1 m2 of residential and usage space in attractive places in Warsaw or Krakow jumped by as much as 60 percent. Investors, for fear of further increases, buy land to increase their future profits. They are not deterred by soaring construction costs and time-consuming administrative procedures. The purchase of land can be financed in a number of ways. Many transactions are based on loans, many is financed from ongoing development activities, and some from issuance of bonds. The pro-ecological, high standard housing estates, in unique location, turned out to be a hit among housing investments in the last year. The recent changes have translated into the demand for flats in recreational and tourist-attractive locations. The demand for land for residential buildings is further increased by the investments into premises for institutional quality lease. More and more development companies are involved in this type of projects, despite the lower margin. The share of the Private Rented Sector (PRS) in the sale of apartments as registered in 2021 by listed entities has already increased to over a dozen percent. Warehouses, warehouses everywhere As in case of housing developments, we can talk about very high demand for land for the planned warehouse and industrial investments. Wherever we see changes, road infrastructure improvements or express roads planned for construction, the land is immediately secured with preliminary contracts. It is easier to find plots for logistics projects, as investments in this sector are also carried out in greenfield areas located outside the administrative borders of cities. Therefore, both the greater supply and less competition from investors looking for land for investments in residential or service and commercial sectors. The land in required for both large-format investments with an area of â€‹â€‹several dozen or over 100 thousand m2, as well as the so-called last mile warehouses and smaller municipal facilities. Investors from the warehouse sector are primarily interested in plots located near logistics hubs and in the vicinity of the largest cities, as well as plots located in smaller towns due to the rapidly growing online sales. The warehouse market is currently experiencing a period of the development of speculative investments. The companies are not afraid to perform such projects, as the demand for warehouse space has never been growing so fast as now, and there is practically no free warehouses space available. This is largely related to the growth of the e-commerce market, which is expected to grow further in value in the coming years, at the average rate of several per cent per annum. Moreover, the change of the transport structure, shortening the supply chains or the growing demand for buffer areas, where inventories are stored, also affect this demand. Similarly, the warehouses generate over half of the transaction volume on the investment market in Poland. Year by year, the logistics and industrial sectors are increasing their market share, reaching new highs. Our market is the point of interest of foreign capital from Europe, mainly from Germany, as well as North American and Asian companies. Shares of small shopping centers are going up Developers also share a keen interest in the construction of retail parks. The format now brings together as many as three-quarters of new investments in the retail sector. Retail parks, just like warehouses, have attracted more and more attention of funds and capital groups as investment assets. Although in Poland in 2021 the retail space has increased by 300,000 m2, with the same amount currently under construction, 70 percent of which being the retail parks, unfortunately there is still a shortage of this commodity. Hence, one-third of transactions for the purchase of commercial real properties from the last year concerned older-generation properties, dominated by properties owned by Tesco. The recent popularity of retail parks and convenience centers has resulted in the increased interest of the investors to perform such projects. Investors often enter into these investments in order to diversify their real properties portfolio. However, of course there are also entities on the market that specialize only in this format. The advantage of projects related to the construction of retail parks is that their construction process can be completed within 18 months, and the entry threshold is much lower in comparison to larger projects. In case of these projects, investors are looking for land mostly in smaller cities up to 100,000 or even 50,000 residents, in which market saturation is not too high. Land in such locations is much cheaper than in the largest cities, which also translates into higher investment profitability. The most attractive plots of land for new projects are located in areas which can potentially be visited also by residents of the surrounding boroughs. In case of retail parks, the key to ensuring satisfactory returns on investment is to include in the list of tenants a popular foodstuff chainstore. This is not only one of the most important reasons for visiting a shopping center, but also influences the image of the facility. An interesting trend that we can observe recently is the appearance of new brands in retail parks, often boutique brands, that have never been present in such facilities before. Land - the star of the investment market The high activity on the investment land market is also evidenced by the transactions carried out in 2021 by LBC Invest, most of which concerned land real properties. In WrocÅ‚aw and Kraków, we have supported our clients with comprehensive customer services for contracting of land in the implementation of development projects in the residential segment for over 45.000 m2 of residential and usable area. Some of them are under construction, and some are in the phase of obtaining building permits. We also closed a few speculative transactions last year. We are currently performing activities on over 70 ha of land. In the last quarter of 2021, we also signed contracts for the performance of comprehensive investment processes, including commercialization for retail parks located in Krakow and two smaller cities – in Lesser Poland and Pomeranian regions, with investors both from Africa and Poland. Last year, we also managed transactions for the purchase of commercialized land, together with construction designs and a building permit, and at the same time concluding general contracting agreements with previously selected companies. Concluding the contract of sale in this form was a condition for the purchase of investment areas, especially those for retail parks and located in attractive locations, with a built-up area of â€‹â€‹2,500 to 8,000 GLA.

Alphabet (GOOGL) To Split Its Stocks (20:1) The Simplest Question Is... Why?

Dividend Power 14.02.2022 15:34

Recently, Google (GOOGL) announced that it would conduct a stock split. Inspired by an excellent 4th quarter earnings report and a high share price, Google has decided to split the stock to help more new investors acquire shares. The split would be a 20-for-1 stock split. How Has Google Grown Over the Years? In 2015, Google rebranded itself into the Tech giant Alphabet. Larry Page sought to make Google something more than a search engine. The company had ambitions of working on healthcare, hardware, and drones, which was a bit different from having a search engine-focused business. It would help create something more than the internet. So, Google changed its name and vision to the holding company Alphabet, allowing them to create, experiment, and invest in new opportunities. People continue to see the growth in a stock like Alphabet. After the 4th quarter, Alphabet announced their earnings, which grew over 32%. This revenue growth sent the stock soaring another 7.5% in after-hours trading. Due to the continued growth of Alphabet, their stock has become too pricey for everyday retail investors. A split can solve the problem. For instance, both Apple (AAPL) and Telsa (TSLA) split their stock allowing more investors to buy at lower prices. In addition, splitting their stock to lower the cost enables new investors to jump on board and become owners of the company. Alphabet has three classes of stock, class A, B, and C. Class A gives each shareholder one vote. Class B is for some of the founders and early investors into the company, and they have ten votes per share. Lastly, Class C has no votes. Each of these classes will conduct a stock split. One of the great things about Alphabet is that it continues to grow. Since May of 2020, Alphabet's value has doubled. Earlier this year, Alphabet posted a 62% revenue growth for the 2nd quarter. Right now, the company is worth just shy of $2 trillion, making it one of the world's largest companies by market cap. So naturally, investors want to be a part of a growing company. A stock split allows more people to be invested for the long term with Alphabet. What Exactly is a Stock Split? A stock split is when a company splits a stock dividing it up and giving the shareholder additional shares. For instance, if a share of stock was worth $1,000, a company could do a 10-for-1 split. This split would give each shareholder ten shares for every share they currently own. Each share would now be worth $100 apiece. However, the total market capitalization does not change before or after the split. Companies may split the stock when the share price rises too quickly, making it unattainable for new customers to hold that share. The price gets too high. Why is Alphabet Splitting Its Stock? Alphabet is the most expensive stock on a per share basis in Silicon Valley, and there are other opportunities to explore as an investor. Alphabet's stock is nearly $3,000 per share. At this stock price, many new investors cannot own a part of Alphabet unless they go the route of fractional shares or do index investing. Other authors have speculated that Alphabet is seeking to join the Dow Jones Industrial Average. The Dow Jones is a price-weighted index, and with the high price of Alphabet stock, the Index would not want to bring them on board. In August of 2020, Apple did a 4-for-1 split of their stock, and it lowered their weight by about 3% in the Dow 30. Companies like Alphabet and Amazon are too large to be added into the Dow. Their stock prices would have an uneven weight due to the high cost. If those companies split their stock to lower prices, it gives them more advantages, and they can join the Dow 30. As Alphabet wants to continue to grow, it will want to add new investors and reach broader audiences. By potentially joining the Dow 30, Alphabet can make this happen by going through the various index funds and mutual funds that track the Dow Jones. Will the Split Affect the Value of the Stock? What happens when a split is announced? The total value of the shares will not drop. Instead, the new stock price will fall by 1/20th of the old stock price. Typically, shares increase in aftermarket trading like we saw the day after Alphabet announced the split. The total value will not be reduced in any way after the stock split. Each Class A and Class B shareholder will now have more votes but in the same proportion as before the split, and the Class C shares will continue to be the cheapest avenue to owning a piece of Google. When Will This Stock Split Take Place? Alphabet has announced that everyone that owns sarees on July 1st will receive their new shares on Friday, July 15th. That price should be around $150 per share, which is 1/20th of the cost of $3,000. The trading at the new stock price will take place on July 18th. What Does This Mean for the Regular Investor? Typically, a stock split is neither good nor bad. The stock will usually rise with the new interest from investors, and eventually, the buzz will fade away. However, if this is a worry for you as an individual shareowner, then maybe owning an index fund or ETF is the way to go for you to improve diversification. As Alphabet grows, it will continue to grow its revenue streams and bring more value to the shareholder. Growth is an excellent thing for an investor. We see many companies declining, like GE (GE) or even AT&T (T). For instance, AT&T (T) cut its dividend due to continued weakness and a change in strategy. As companies like Apple, Microsoft, and Alphabet continue to innovate and create, investors will want to be a part of the journey as shareholders. Should you worry about Google's stock split? Again, there is nothing to worry about; just keep to your investing strategy and keep investing. Author Bio: Dividend Power is a self-taught investor and blogger on dividend growth stocks and financial independence. Some of his writings can be found on Seeking Alpha, TalkMarkets, ValueWalk, The Money Show, Forbes, Yahoo Finance, Entrepreneur, FXMag, and leading financial blogs. He also works as a part-time freelance equity analyst with a leading newsletter on dividend stocks. He was recently in the top 1.5% (126 out of over 8,212) of financial bloggers as tracked by TipRanks (an independent analyst tracking site) for his articles on Seeking Alpha. Disclaimer: Dividend Power is not a licensed or registered investment adviser or broker/dealer. He is not providing you with individual investment advice. Please consult with a licensed investment professional before you invest your money.

Tesla Stock Price and Forecast: Should I buy TSLA, RIVN or LCID?

FXStreet News 14.02.2022 15:59

TSLA drops nearly 5% on Friday as macro factors in charge. All EV stocks LCID, Chinese names suffer the same fate. Tesla once again is targetting its 200-day moving average. Tesla (TSLA) followed many EV names (all, if we are correct) lower on Friday as macro factors took charge over equity markets. The dominant theme so far in 2022 has been one of rising rates and inflationary pressures. This has led to high growth and tech names underperforming, while energy and financial stocks have been the place to be. That is likely to remain the theme for at least the next quarter if not also Q2. Russia and Ukraine tensions have pushed the oil price above $90, and financial stocks benefit from higher interest rates. Growth stocks, however, do not benefit from higher interest rates as investors look for businesses with cash. With higher interest rates, future cash flows become less valuable. So of the three names mentioned, Tesla, Rivian (RIVN) or Lucid (LCID), we would not want to currently be long any of them. We expect TSLA to perform best of the three due to its market-leading position and revenue, but this sector is out of favour and likely to remain so. Tesla Stock News The latest data from the China Passenger Car Association (CPCA) confirms what we saw from Chinese EV companies earlier. Deliveries for January were down versus December. This is due to the lunar new year in China. Tesla sold 59,845 vehicles in January, down from 70,847 China-made vehicles in December. The Chinese electric vehicle market remains the largest EV market in the world, helped by government incentives and population demand. Tesla Stock Forecast Tesla remains in the strong downtrend identified earlier this year. $945 was tested multiple times as resistance and failed. This has resulted in the recent pullback. Now $824 remains as the 200-day moving average. Below we have trendline support at $752. The 200-day is the key level. Tesla has not closed below its 200-day moving average since June 2021. It has broken the 200-day on an intraday basis several times since but always failed to close below. Notice how volume has steadily been declining in Tesla this month, despite some hugely volatile days. This is indicative of a lack of conviction in the stock. Tesla (TSLA) chart, daily

Indices: Russia-Ukraine Tension Eased? GER 40 On A Way To A Stable Price?

8 eightcap 15.02.2022 10:32

We’re seeing a solid momentum shift today as news hit that some Russian troops have been returned to bases. This ease in tentions is driving risk buying after what has been a sorry few days for buyers as prices plunged on worries Russia was close to invading Ukraine. Friday GER30 returned to LT support a level that held for buyers since May 2021. Above that, we are also watching a shorter-term level of support seen at 15,030. On top of the levels, we can also see a double bottom and the Williams %R has crossed the mid-point range. While these technical indicators look great the meat in this sandwich is the continued ease in tentions, this fact in our opinion is key to seeing this current rally turn into something more. If we do see a continuation of buying as the European situation improves we would look for the GER30 to continue tracking higher and we would look at 15,601 as possible resistance if reached which lines up with the longer-term 86ema. GER30 D1 Chart The post CFD Update: GER30 on the recovery trail as tensions ease appeared first on Eightcap.

Sandbox price set for breakout as bulls target some low-hanging fruit

FXStreet News 15.02.2022 16:09

Since December, sandbox has been trying to break the downtrend. As bulls attempt to break through, expect some profits to be booked as some targets lie nearby. Once above $4.72, expect $5.00 and $6.00 to be the following targets in the relief rally. Sandbox (SAND) price action is surfing on a wave of relief this morning as tensions between Russia, and the West start to ease on positive news. With that, investors have been falling over each other to get back into cryptocurrencies, and Sandbox price is set to break the longer-term red descending trendline, and downtrend since December last year. Some low-hanging fruit will be targeted in the breakthrough and could provide enough incentive for bulls to book partial profits and go for the ultimate goal of $6.00, holding 47% of gains. Sandbox bulls are in for 47% gains in the relief rally Sandbox price action is again hammering on the red descending trend line that originates from December last year and has been dictating the downtrend ever since. The renewed push comes from tailwinds that emerged overnight on some positive news around de-escalation in the situation between Russia and Ukraine. As the scene is set for a solid relief rally, expect to see some excellent (https://www.fxstreet.com/cryptocurrencies/news/sandbox-tests-support-at-425-before-sand-test-prior-all-time-highs-202202112001) returns, beginning with some nice profits nearby as a good start. SAND bulls will have their eyes on $4.72 with the 55-day Simple Moving Average and an overall (https://www.fxstreet.com/cryptocurrencies/news/cryptocurrencies-price-prediction-dogecoin-sandbox-and-cardano-european-wrap-10-february-video-202202101133) pivotal level falling in line around the same area. Although this level is not far from the red descending trendline, it will still return around 16% of gains intraday. Bulls will have a good incentive to book profits midway but stay in the trade with more considerable profits gained when the price rises towards $5.00 and $6.00 – the next targets in this week’s relief rally. The trade has an excellent risk-return ratio and is the most viable (https://www.fxstreet.com/cryptocurrencies/news/sandbox-price-bound-for-another-30-gains-as-sand-finds-support-202202101005) as we advance. SAND/USD daily chart Should German chancellor Scholz come out with some negative comments and ramp up the rhetoric of full-scale escalation of the tensions, expect (https://www.fxstreet.com/cryptocurrencies/news/shiba-inu-to-enter-the-metaverse-and-challenge-axie-infinity-sandbox-and-decentraland-202202091718) a knee jerk reaction with a firm rejection or false break of the red descending trend line, trapping bulls and pushing them out of their positions as SAND price action collapses back towards $3.50. From there, another leg lower could follow towards $3.00, with the 200-day SMA coming in at around $2.85 and playing its part as a supportive element in the belief that a recovery is still possible. If the 200-day SMA is no match for the downward pressure, expect a break and further push towards $2.50 or $2.00.

Should Someone Tell The Price Of Gold It's Time To Review Its Incoming "Oponents"?

Przemysław Radomski 15.02.2022 16:00

Gold continues to benefit from the market turmoil and has apparently forgotten about medium-term problems. Meanwhile, the rising USD and a hawkish Fed await confrontation. With financial markets whipsawing after every Russia-Ukraine headline, volatility has risen materially in recent days. With whispers of a Russian invasion on Feb. 16 (which I doubt will be realized), the game of hot potato has uplifted the precious metals market. However, as I noted on Feb. 14, while the developments are short-term bullish, the PMs’ medium-term fundamentals continue to decelerate. For example, while the general stock market remains concerned about a Russian invasion, U.S. Treasury yields rallied on Feb. 14. With risk-off sentiment often born in the bond market, the safety trade benefiting the PMs didn’t materialize in U.S. Treasuries. As a result, bond traders aren’t demonstrating the same level of fear. Please see below: Source: Investing.com Furthermore, while the potential conflict garners all of the attention, the fundamental issues that upended the PMs in 2021 remain unresolved. For example, with inflation surging, St. Louis Fed President James Bullard said on Feb. 14 that “the last four [Consumer Price Index] reports taken in tandem have indicated that inflation is broadening and possibly accelerating in the U.S. economy.” “The inflation that we’re seeing is very bad for low- and moderate-income households,” he said. “People are unhappy, consumer confidence is declining. This is not a good situation. We have to reassure people that we’re going to defend our inflation target and we’re going to get back to 2%.” As a result, Bullard wants a 50 basis point rate hike in March, and four rate hikes by July. Please see below: Source: CNBC Likewise, while San Francisco Fed President Mary Daly is much less hawkish than Bullard, she also supports a rate hike in March. Source: CNBC As a result, while the PMs can hide behind the Russia-Ukraine conflict in the short term, their medium-term fundamental outlooks are profoundly bearish. As mentioned, Bullard highlighted inflation’s impact on consumer confidence, and for a good reason. With the University of Michigan releasing its Consumer Sentiment Index on Feb. 11, the report revealed that Americans’ optimism sank to “its worst level in a decade, falling a stunning 8.2% from last month and 19.7% from last February.” Chief Economist, Richard Curtin said: “The recent declines have been driven by weakening personal financial prospects, largely due to rising inflation, less confidence in the government's economic policies, and the least favorable long term economic outlook in a decade.” “The impact of higher inflation on personal finances was spontaneously cited by one-third of all consumers, with nearly half of all consumers expecting declines in their inflation adjusted incomes during the year ahead.” Please see below: To that point, I’ve highlighted on numerous occasions that U.S. President Joe Biden’s re-election prospects often move inversely to inflation. With the dynamic still on full display, immediate action is needed to maintain his political survival. Please see below: To explain, the light blue line above tracks the year-over-year (YoY) percentage change in inflation, while the dark blue line above tracks Biden’s approval rating. If you analyze the right side of the chart, you can see that the U.S. President remains in a highly perilous position. Moreover, with U.S. midterm elections scheduled for Nov. 8, the Democrats can’t wait nine to 12 months for inflation to calm down. As a result, there is a lot at stake politically in the coming months. As further evidence, as inflation reduces real incomes and depresses consumer confidence, the Misery Index also hovers near crisis levels. Please see below: To explain, the blue line above tracks the Misery Index. For context, the index is calculated by subtracting the unemployment rate from the YoY percentage change in the headline CPI. In a nutshell, when inflation outperforms the unemployment rate (the blue line rises), it creates a stagflationary environment in America. To that point, if you analyze the right side of the chart, you can see that the Misery Index is approaching a level that coincided with the global financial crisis (GFC). As a result, reversing the trend is essential to avoid a U.S. recession. As such, with inflation still problematic and the writing largely on the wall, the market-implied probability of seven rate hikes by the Fed in 2022 is nearly 93% (as of Feb. 10). Please see below: Ironically, while consumers and the bond market fret over inflation, U.S. economic growth remains resilient. While I’ve been warning for months that a bullish U.S. economy is bearish for the PMs, continued strength should turn hawkish expectations into hawkish realities. To that point, the chart above shows that futures traders expect the U.S. Federal Funds Rate to hit 1.75% in 2022 (versus 0.08% now). However, Michael Darda, Chief Economist at MKM Partners, expects the Fed’s overnight lending rate to hit 3.5% before it’s all said and done. “We have this booming economy with high inflation and a rapid recovery in the labor market – much different relative to the last cycle,” he said. “The Fed is behind the curve this time. They are going to have to do more.” Singing a similar tune, John Thorndike, co-head of asset allocation at GMO, told clients that “inflation is now here, [but] the narrative is that inflation goes away and markets tend to struggle with change. It is more likely than not that real yields and policy rates need to move above inflation during this cycle.” The bottom line? While the Russia-Ukraine drama distracts the PMs from the fundamental realities that confront them over the medium term, their outlooks remain profoundly bearish. Moreover, while I’ve noted on numerous occasions that the algorithms will enhance momentum in either direction, their influence wanes materially as time passes. As such, while headline risk is material in the short-term, history shows that technicals and fundamentals reign supreme over longer time horizons. Thus, while the recent flare-up is an unfortunate event that hurts our short position, the medium-term developments that led to our bearish outlook continue to strengthen. In conclusion, the PMs rallied on Feb. 14, as the Russia-Ukraine conflict is the primary driver moving the financial markets. However, while the PMs will ride the wave as far as it takes them, they ignored that the USD Index and U.S. Treasury yields also rallied. Moreover, with Fed officials ramping up the hawkish rhetoric, the PMs' fundamental outlook is more bearish now than it was in 2021 (if we exclude the Russia-Ukraine implications). As a result, while the timeline may have been delayed, lower lows should confront gold, silver, and mining stocks in the coming months. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Fat or Flat: Gold Price in 2022

Arkadiusz Sieron 15.02.2022 17:10

Analysts' 2022 forecasts for the gold market are not overwhelmingly enthusiastic – they see it flat. However, maybe the opposite should be expected. The LBMA has recently published its annual precious metals forecast survey. In general, the report is neutral about gold in 2022. On average, the analysts forecast gold prices to be broadly flat this year compared to the year. The average gold price in 2021 was $1,799, and it is expected to rise merely $3 to $1,802. How boring! However, as the table below shows, the forecasts for other precious metals are much more bearish, especially for palladium. The headline numbers are the averages of 34 analysts’ forecasts. The greatest bears see the average price of gold as low as $1.630, while the lowest low – at $1,500. Meanwhile, the biggest bulls expect the average price of gold to be $1,965, while the highest high is expected to be $2.280. The three most important drivers of precious metals prices’ performance this year are the Fed’s monetary policy, inflation, and equity market performance. This is a huge change compared to last year, when analysts considered geopolitical factors, the impact of the COVID-19 pandemic, and the pace of economic recovery to be much more important. I agree this time, of course, as I always believed that macroeconomic factors are more relevant to the long-term trend in the gold market than geopolitical drivers. Generally, the pick-up in inflation, which will keep real interest rates in negative territory, is seen as a tailwind for gold. Some analysts also expect the greenback to depreciate as the global economic recovery gathers steam, which would also be supportive of gold prices. Meanwhile, normalization of monetary policy is considered the greatest headwind for the yellow metal, as the Fed’s tightening cycle will raise the opportunity cost of holding gold. However, the markets have probably already priced the interest rate hikes in, so gold doesn’t have to suffer during the tightening cycle. Last time, the price of gold began to rise after the liftoff of the federal funds rate. The analysts surveyed by the LBMA also doubt the central banks’ ability to raise interest rates as high as needed to crush inflation. Instead, they are expected to stay behind the inflation curve. This is because the forecasted tightening cycle could be too difficult for the asset market and indebted economy to stomach, so it will be moderate and short-lived, just like last time. Implications for Gold What does the LBMA annual forecast survey predicts for the yellow metal? The report is neutral, probably because gold remains under the influence of opposite forces, which makes forecasting really challenging this year. Gold has been recently in a sideways trend, so it’s somewhat natural to expect simply more of the same, i.e., the flat market. Actually, the pundits always forecast more of the same. For example, the previous edition of the survey was bullish, as 2020 was a great year for gold. Thus, the analysts’ 2021 average forecast for the price of gold was $1,973.8, almost $200 above the actual level. Hence, please take the survey with a pinch of salt. OK, the analysts don’t predict a literally flat market. The forecasts concerned averages, but some experts see the first half of the year as more bullish than the second, while others, vice versa. I’d rather include myself in the latter group, as my view is that the expectations of Fed tightening will continue to exert downward pressure on gold prices in the coming weeks. However, the hawkish expectations have probably gone a little too far. At some point this year, they will be adjusted, as it becomes clear that the Fed will be forced to reduce the pace of its tightening or even reverse its stance in order to calm the market and avoid the next economic crisis. Such an adjustment will be positive for gold prices, especially since it might occur amid still high inflation, but gold bulls should remember that there is still a long way to go before that happens. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Binance Coin set for pop above significant resistance as relief rally takes a short halt

FXStreet News 16.02.2022 16:18

Binance Coin takes a small step back this morning due to some profit-taking.BNB bulls hold all the cards as the relief rally is not over yet.Expect a pop above $444-$452 with a profit target set at $480 for the moment.Binance Coin (BNB) price action shot back above the red descending trend line yesterday with a massive relief rally that lifted market sentiment. With that, the downtrend looks to be broken, and an uptrend could be on the cards if bulls can take out the $444-$452 resistance barrier with a triple top formation, the 55-day Simple Moving Average (SMA) and the longer-term pivotal level all coincide in this region. Once through there, expect the next stage to be set for a move towards $480 with the 200-day SMA coming in, returning another 10%.Binance Coin set for the second phase in the recovery rallyBinance Coin is undergoing some profit-taking this morning after the solid relief rally from yesterday (https://www.fxstreet.com/cryptocurrencies/news/cryptocurrencies-price-prediction-decentraland-binance-dogecoin-asian-wrap-16-feb-video-202202160214) that has lifted market sentiment and saw some decent inflows into markets. On the way up, bulls hit some resistance from the double top from February 08 and January 21 and, in the process, made it a triple top resistance. This, together with the already known $452 and the 55-day SMA coming in at $445, makes it a substantial (https://www.fxstreet.com/cryptocurrencies/news/binance-coin-must-break-out-above-this-level-before-bnb-can-retest-660-202202152150) barrier that will need to be broken to prove that the relief rally still has plenty of juice to go.Expect thus some profit-taking today, a little bit on the back foot with $419 as support to bounce off back to $445. Some more positive signals coming from the Russia-Ukraine developments could be the needed additional catalyst to push through this difficult barrier. The next target is set at $480, with the 200-day SMA falling in line with that considerable number, resulting in probably the same profit-taking pattern (https://www.fxstreet.com/cryptocurrencies/news/dogecoin-and-shiba-inu-price-climbs-as-binance-smart-chain-whales-accumulate-meme-coins-202202151719) as BNB price action shows today.BNB/USD daily chartOverall, the US keeps claiming that the situation in Central-Europe remains precarious and could see an escalation (https://www.fxstreet.com/cryptocurrencies/news/cryptocurrencies-price-prediction-bitcoin-binance-coin-and-decentraland-european-wrap-11-february-202202111055) any time now. Once those headlines hit the wires, expect the whole cryptocurrency space to collapse and for there to be a massive pullback from investors, with BNB price falling back initially to $389. Depending on the severity of the attacks, another push lower towards $340 would be the logical outcome and result in BNB price shedding 22% of its value.

AUDUSD And NZDUSD Charts Looks Quite Similar... SPX Trades A Bit Lower Than A Few Days Ago

John Benjamin 18.02.2022 08:51

AUDUSD attempts to break out The Australian dollar finds support from a low jobless rate in January. The pair has previously hit resistance in the supply zone around 0.7250. This is a daily resistance from the sell-off in late January. Then a recovery above 0.7180 suggests solid buying pressure before a bearish mood could take hold again. A break above the key hurdle could initiate a bullish reversal above this year’s peak (0.7310). Otherwise, a prolonged consolidation may test the demand area between 0.7100 and 0.7150. NZDUSD tests resistance The New Zealand dollar climbed higher as the RBNZ can lift its cash rates next week. Price action came under pressure on the 30-day moving average (0.6730). However, strong support at 0.6590 builds a case for a potential reversal. A break above 0.6690 is an encouraging sign leaving 0.6730 as the last obstacle before a bullish extension. A broader rally would bring the kiwi back to January’s high at 0.6890. In the meantime, an overbought RSI caused a brief pullback towards 0.6660. SPX 500 consolidates The S&P 500 struggles as the Russia-Ukraine crisis persists. The previous rebound has met stiff selling pressure over the 30-day moving average (4590). A pullback has sent the RSI into the oversold territory, triggering some buyers’ interest in racking up the bargain. The rebound is still valid as long as the index stays above the critical area of 4280. A break above 4480 may extend gains to the double top at 4590 which is an important resistance. 4360 is the immediate support if the sideways action lingers.

Is It Worth Adding Gold to Your Portfolio in 2022?

Arkadiusz Sieron 17.02.2022 16:29

Gold prices declined in 2021 and the prospects for 2022 are not impressive as well. However, the yellow metal’s strategic relevance remains high. Last month, the World Gold Council published two interesting reports about gold. The first one is the latest edition of Gold Demand Trends, which summarizes the entire last year. Gold supply decreased 1%, while gold demand rose 10% in 2021. Despite these trends, the price of gold declined by around 4%, which – for me – undermines the validity of the data presented by the WGC. I mean here that the relevance of some categories of gold demand (jewelry demand, technological demand, the central bank’s purchases) for the price formation is somewhat limited. The most important driver for gold prices is investment demand. Unsurprisingly, this category plunged 43% in 2021, driven by large ETF outlfows. According to the report, “gold drew direction chiefly from inflation and interest rate expectations in 2021,” although it seems that rising rates outweighed inflationary concerns. As the chart below shows, the interest rates increased significantly last year. For example, 10-year Treasury yields rose 60 basis points. As a result, the opportunity costs for holding gold moved up, triggering an outflow of gold holdings from the ETF. As the rise in interest rates is likely to continue in 2022 because of the hawkish stance of the Fed, gold investment may struggle this year as well. The end of quantitative easing and the start of quantitative tightening may add to the downward pressure on gold prices. However, there are some bullish caveats here. First, gold has remained resilient in January, despite the hawkish FOMC meeting. Second, the Fed’s tightening cycle could be detrimental to the US stock market and the overall, highly indebted economy, which could be supportive of gold prices. Third, as the report points out, “gold has historically outperformed in the months following the onset of a US Fed tightening cycle”. The second publication released by the WGC last month was “The Relevance of Gold as a Strategic Asset 2022”. The main thesis of the report is that gold is a strategic asset, complementary to equities and bonds, that enhances investment portfolios’ performance. This is because gold is “a store of wealth and a hedge against systemic risk, currency depreciation, and inflation.” It is also “highly liquid, no one’s liability, carries no credit risk, and is scarce, historically preserving its value over time.” Gold is believed to be a great source of return, as its price has increased by an average of nearly 11% per year since 1971, according to the WGC. Gold can also provide liquidity, as the gold market is highly liquid. As the report points out, “physical gold holdings by investors and central banks are worth approximately $4.9 trillion, with an additional $1.2 trillion in open interest through derivatives traded on exchanges or the over-the-counter (OTC) market.” Last but not least, gold is an excellent portfolio diversifier, as it is negatively correlated with risk assets, and – importantly – this negative correlation increases as these assets sell off. Hence, adding gold to a portfolio could diversify it, improving its risk-adjusted return, and also provide liquidity to meet liabilities in times of market stress. The WGC’s analysis suggests that investors should consider adding between 4% and 15% of gold to the portfolio, but personally, I would cap this share at 10%. Implications for Gold What do the recent WGC reports imply for the gold market? Well, one thing is that adding some gold to the investment portfolio would probably be a smart move. After all, gold serves the role of both a safe-haven asset and an insurance against tail risks. It’s nice to be insured. However, investing in gold is something different, as gold may be either in a bullish or bearish trend. You should never confuse these two motives behind owning gold! Sometimes it’s good to own gold for both insurance and investment reasons, but not always. When it comes to 2022, investment demand for gold may continue to be under downward pressure amid rising interest rates. However, there are also some bullish forces at work, which could intensify later this year. If you enjoyed today’s free gold report, we invite you to check out our premium services. We provide much more detailed fundamental analyses of the gold market in our monthly Gold Market Overview reports and we provide daily Gold & Silver Trading Alerts with clear buy and sell signals. In order to enjoy our gold analyses in their full scope, we invite you to subscribe today. If you’re not ready to subscribe yet though and are not on our gold mailing list yet, we urge you to sign up. It’s free and if you don’t like it, you can easily unsubscribe. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care

Still Taking The Conflict Into Consideration, What's Not A Big Surprise

Walid Koudmani 18.02.2022 12:48

While US indices plunged yesterday as the situation near the Ukraine-Russia border remained tense with the S & P 500 dropping 2.12%, Nasdaq falling 2.88% and Dow Jones pulling back 1.78%, reports of shelling in Luhansk and Donetsk Oblasts in eastern Ukraine continue. However, the US President will host a meeting with leaders of Canada, France, Germany, Poland, Italy, Romania, UK, EU and NATO today which along with an announced meeting between US secretary Blinken and Russia's Lavrov next week has helped moods stabilize slightly. Oil prices pulled back noticeably with Brent dropping below $90 and gold gave up some gains after benefiting from the significant risk-off moods seen this week which saw it reach the highest level since mid 2021. With a lack of data releases and with a long weekend ahead in the US, we could be seeing significant volatility across markets as investors and traders adjust their positions to limit risk exposure and in anticipation of a potential escalation of the conflict. On the other hand, any sign of easing of tensions has been received positively from markets and further indication could lead to a return of risk appetite across asset classes, which could favor stocks as well as the cryptocurrency market, which have struggled to maintain gains lately. UK retail sales point to continued post pandemic recovery Today's retail sales figures continue to provide encouraging signs as the economy recovers from the pandemic and as businesses as well as consumers begin to adjust to rising inflation. While these figures indicated a rise of retail sales volumes by 1.9% in January 2022 following a fall of 4.0% in December 2021, an interesting thing to note is that the proportion of retail sales online fell to 25.3% in January 2022, its lowest level since March 2020 (22.7%). Ultimately, it remains to be seen how the Bank of England's policy will facilitate this trend moving forward in order to avoid a stagnation situation and as rising prices across sectors continue to add pressure.

Thaw Incoming? GBP Could Be Ahead Of An Uptrend As Retails Sales Indicator Hits Fine Value

Alex Kuptsikevich 18.02.2022 09:30

UK retail sales added 1.9% in January, following a dip of 4.0% a month earlier. By the same month a year earlier, the increase was 9.1%, as January 2021 saw a sharp tightening of the lockdown and the vaccination campaign had only just started. The data came out slightly better than expected, supporting purchases of British currency against the dollar, but remains very volatile due to restrictions in previous months. Sales generally remained above multi-year trend levels, which is a good signal of the economy’s health. After the financial crisis from 2009 to 2016, there was a long period when sales were below the long-term trend line and were one of the obstacles why the Bank of England could not go ahead with a rate hike. These days, the need to suppress inflation is combined with the ability to do so thanks to strong consumer demand and the labour market. Sales were also boosted by pent-up demand for services and goods that were in restricted supply during the pandemic. This process may gain momentum in the coming months, painting a more colourful picture of consumer activity, but could lead to disappointment in the second half of the year. The Bank of England should keep a close eye on the coming economic releases to avoid repeating the mistakes of the ECB, which rushed through a rate hike in May 2009, undermining the economic recovery. On Friday morning, the British pound is testing the highs of February, rising to 1.3630. A rise to 1.3680 may be a development in the current momentum. However, a jump even higher would reflect a break of the downtrend since last June, anchoring GBPUSD above the 200-day average and setting the pair up to test previous highs.

Ukraine parliament approves crypto legislation amidst rising geopolitical tension

FXStreet News 18.02.2022 16:20

Ukraine has revised its cryptocurrency bill and replaced the regulatory body for oversight on cryptocurrencies. Amidst rising geopolitical tensions, Ukraine has established the National Securities and Stock Market Commission of Ukraine.The updated version of the crypto bill identifies the National Bank of Ukraine and NSSMC as two major crypto regulators. Verkhovna Rada, the Parliament of Ukraine, has approved significant amendments in the country’s cryptocurrency bill, “On Virtual Assets.” Proponents consider the amendment bullish for the adoption of cryptocurrencies in Ukraine. Ukraine passes legislation on cryptocurrency bill amendmentWhile geopolitical tension rises, cryptocurrencies have suffered a bloodbath. Ukrainian Rada has passed the legislation in the second reading despite the dropping price and market capitalization, with 272 out of 365 deputies supporting the bill. The Ministry of Digital Transformation is no longer on the list of authorities overseeing the cryptocurrency market. The Parliament has appointed The National Securities and Stock Market Commission of Ukraine or NSSMC to regulate the cryptocurrency market. The updated version of the cryptocurrency bill appoints the two significant authorities National Bank of Ukraine and the NSSMC, as regulators of the crypto market. The authorities have been appointed to oversee the turnover of assets backed by currency valuables. Cryptocurrency assets and derivative financial instruments would be regulated under the new provisions. Alex Bornyakov, the Deputy Minister of Ukraine’s Ministry of Digital Transformation, believes that the ministry’s latest moves indicate an acceptance of cryptocurrencies in Ukraine. The country first started working on its crypto bill in November 2021, adopting cryptocurrencies to become a leader in the ecosystem. However, the initial crypto bill was sent back to the Parliament for further consideration. The news of the amendment is considered positive for adopting cryptocurrencies in Ukraine. This could contribute to a rise in demand in times of geopolitical tension.

In Contrary To Others, DXY Is Likely To Feel Stable

Przemysław Radomski 18.02.2022 16:25

Gold and the USDX reacted vigorously to the worrisome news concerning Eastern Europe. However, only the latter can be calm about its medium-term future. As geopolitical tensions uplift gold, silver, and mining stocks, they’re in rally mode each time a doom-and-gloom headline surfaces. However, while the ‘will they or won’t they’ saga commands investors’ attention, the USD Index continues to behave rationally. For example, while volatility has increased recently, the dollar basket has held firm. To explain, I wrote on Feb. 17: The USD Index is at its medium-term support line. All previous moves to / slightly below it were then followed by rallies, sometimes really big rallies, so we’re likely to see something like that once again. Such a rally would be the prefect trigger for the triangle-vertex-based reversal in gold and the following slide. Please see below: Furthermore, the USD Index’s recent pullback was far from a surprise. For example, I highlighted on numerous occasions that the greenback is nearing its weekly rising resistance line, and the price action has unfolded as I expected. Moreover, while overbought conditions resulted in a short-term breather, history shows that the USD Index eventually catches its second wind. To explain, I previously wrote: I marked additional situations on the chart below with orange rectangles – these were the recent cases when the RSI based on the USD Index moved from very low levels to or above 70. In all three previous cases, there was some corrective downswing after the initial part of the decline, but once it was over – and the RSI declined somewhat – the big rally returned and the USD Index moved to new highs. As a result, with the USD Index showcasing a reliable history of profound comebacks, higher highs should materialize over the medium term. Please see below: Just as the USD Index took a breather before its massive rally in 2014, it seems that we saw the same recently. This means that predicting higher gold prices (or those of silver) here is likely not a good idea. Continuing the theme, the eye in the sky doesn’t lie, and with the USDX’s long-term breakout clearly visible, the wind remains at the dollar’s back. Furthermore, dollar bears often miss the forest through the trees: with the USD Index’s long-term breakout gaining steam, the implications of the chart below are profound. While very few analysts cite the material impact (when was the last time you saw the USDX chart starting in 1985 anywhere else?), the USD Index has been sending bullish signals for years. Please see below: The bottom line? With my initial 2021 target of 94.5 already hit, the ~98-101 target is likely to be reached over the medium term (and perhaps quite soon). Mind, though: we’re not bullish on the greenback because of the U.S.’s absolute outperformance. It’s because the region is fundamentally outperforming the Eurozone. The EUR/USD accounts for nearly 58% of the movement of the USD Index, and the relative performance is what really matters. In conclusion, the financial markets remain on Russia-Ukraine watch. While gold, silver, mining stocks, and the USD Index whipsaw on the news, the technical and fundamental backdrops support higher prices for the latter, not the former. Thus, while geopolitical tensions are always short-term bullish for the precious metals, the rush is often short-lived. As a result, the trios’ downtrends that began in late 2020 will likely resurface once the headline-driven market returns to normal. Thank you for reading our free analysis today. Please note that the above is just a small fraction of today’s all-encompassing Gold & Silver Trading Alert. The latter includes multiple premium details such as the targets for gold and mining stocks that could be reached in the next few weeks. If you’d like to read those premium details, we have good news for you. As soon as you sign up for our free gold newsletter, you’ll get a free 7-day no-obligation trial access to our premium Gold & Silver Trading Alerts. It’s really free – sign up today. Przemyslaw Radomski, CFAFounder, Editor-in-chiefSunshine Profits: Effective Investment through Diligence & Care * * * * * All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' associates only. As such, it may prove wrong and be subject to change without notice. Opinions and analyses are based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are deemed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

Wondering How Inflation And Fed Reaction Will Affect Gold

Arkadiusz Sieron 18.02.2022 16:05

Not only won’t inflation end soon, it’s likely to remain high. Whether gold will be able to take advantage of it will depend, among others, on the Fed. Do you sometimes ask yourself when this will all end? I don’t mean the universe, nor our lives, nor even this year (c’mon, guys, it has just started!). I mean, of course, inflation. If only you weren’t in a coma last year, you would have probably noticed that prices had been surging recently. For instance, America finished the year with a shocking CPI annual rate of 7.1%, the highest since June 1982, as the chart below shows. Now, the key question is how much higher inflation could rise, or how persistent it could be. The consensus is that we will see a peak this year and subsequent cooling down, but to still elevated levels. This is the view I also hold. However, would I bet my collection of precious metals on it? I don’t know, as inflation could surprise us again, just as it did to most of the economists (but not me) last year. The risk is clearly to the upside. As always in economics, it’s a matter of supply and demand. There is even a joke that all you need to turn a parrot into an economist is to teach it to say ‘supply’ and ‘demand’. Funny, huh? When it comes to the demand side, both the money supply growth and the evolution of personal saving rate implies some cooling down of inflation rate. Please take a look at the chart below. As you can see, the broad money supply peaked in February 2021. Assuming a one-year lag between the money supply and price level, inflation rate should reach its peak somewhere in the first quarter of this year. There is one important caveat here: the pace of money supply growth has not returned to the pre-pandemic level, but it stabilized at about 13%, double the rate seen at the end of 2019. Inflation was then more or less at the Fed’s target of 2%, so without constraining money supply growth, the US central bank couldn’t beat inflation. As the chart above also shows, the personal saving rate has returned to the pre-pandemic level of 7-8%. It means that the bulk of pent-up demand has already materialized, which should also help to ease inflation in the future. However, not all of the ‘forced savings’ have already entered the market. Thus, personal consumption expenditures are likely to be elevated for some time, contributing to boosted inflation. Regarding supply factors, although some bottlenecks have eased, the disruptions have not been fully resolved. The spread of the Omicron variant of the coronavirus and regional lockdowns in China could prolong the imbalances between booming demand and constrained supply. Other contributors to high inflation are rising producer prices, increasing house prices and rents, strong inflation expectations (see the chart below), and labor shortages combined with fast wage growth. The bottom line is that, all things considered – in particular high level of demand, continued supply issues, and de-anchored inflation expectations – I forecast another year of elevated inflation, but probably not as high as in 2021. After reaching a peak in a few months, the inflation rate could ease to, let’s say, around 4% in December, if we are lucky. Importantly, the moderate bond yields also suggest that inflation will ease somewhat later in 2022. What does it mean for the gold market? Well, I don’t have good news for the gold bulls. Gold loves high and accelerating inflation the most. Indeed, as the chart below shows, gold peaks coincided historically with inflation heights. The most famous example is the inflation peak in early 1980, when gold ended its impressive rally and entered into a long bearish trend. The 2011 top also happened around the local inflationary peak. The only exception was the 2005 peak in inflation, when gold didn’t care and continued its bullish trend. However, this was partially possible thanks to the decline in the US dollar, which seems unlikely to repeat in the current macroeconomic environment, in which the Fed is clearly more hawkish than the ECB or other major central banks. The relatively strong greenback won’t help gold shine. Surely, disinflation may turn out to be transitory and inflation may increase again several months later. Lower inflation implies a less aggressive Fed, which should be supportive of gold prices. However, investors should remember that the US central bank will normalize its monetary policy no matter the inflation rate. Since the Great Recession, inflation has been moderate, but the Fed has tightened its stance eventually, nevertheless. Hence, gold may experience a harsh moment when inflation peaks. Thank you for reading today’s free analysis. We hope you enjoyed it. If so, we would like to invite you to sign up for our free gold newsletter. Once you sign up, you’ll also get 7-day no-obligation trial of all our premium gold services, including our Gold & Silver Trading Alerts. Sign up today! Arkadiusz Sieron, PhDSunshine Profits: Effective Investment through Diligence & Care.

COT Soft Commodities Speculators drop Sugar bullish wagers to 91-week low

Invest Macro 19.02.2022 15:30

COT Energy Speculators push Natural Gas bearish bets to 6-week high

Invest Macro 19.02.2022 15:38

COT Metals Speculators boosted their Copper bullish bets to 15-week high

Invest Macro 19.02.2022 16:38

Bonds Speculators push their surging bearish bets in Eurodollars to 166-high

Invest Macro 19.02.2022 17:38

COT Currency Speculators raise their Euro Futures bullish bets to 26-week high

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Bullish momentum remains strong

Florian Grummes 20.02.2022 17:36

Even at the last important low (US$$1,750) on December 15th, 2021, the sentiment was still awful as the sector had become the most hated asset class. Now fast-forward, gold has been successfully breaking out of its multi month triangle and keeps sprinting higher. The bulls currently are bending the daily and weekly Bollinger Bands to the upside, and seasonality is still supportive.Gold in US-Dollar, weekly chart as of February 20th, 2022.Gold in US-Dollar, weekly chart as of February 20th, 2022.Looking at the weekly chart, it appears that gold not only broke out of a triangle consolidation pattern, but also out of a large inverse head and shoulder pattern. It’s not a textbook head and shoulder, but worthwhile noting. A measured move projection could theoretically take gold towards US$2,125! However, the monthly Bollinger Band, sitting at around US$ 1,975, might be a much more realistic target for the ongoing move. As you might remember, the zone between US$1,950 to US$1,975 is very strong resistance. We would not rule out a short-lived overshoot towards US$,2000, though.Overall, the weekly chart is not yet overbought and looks bullish. Hence, the rally has very good chances to continue for a few more weeks.Gold in US-Dollar, daily chart as of February 20th, 2022.Gold in US-Dollar, daily chart as of February 20th, 2022.As expected, the breakout above US$1,840 to US$1,850 has unleashed enough energy to quickly push gold prices towards the round psychological number of US$1,900. Fortunately, the daily stochastic has transformed its overboughtness into the rare “embedded status”, where both signal lines are sitting above 80 for more than three days in a row. Hence, the uptrend is locked-in and shorting this market would be fighting the uptrend.Of course, given the uncertain and complex geopolitical situation, events can and likely will strongly influence gold over the coming days and weeks. Speaking from a technical point of you, any pullback towards the breakout zone around US$1,845 would be a buying opportunity. However, prices below US$1,875 would already be a surprise in the short-term. On the contrary, it’s much more likely that gold will continue its run to at least US$1,930 over the coming days.In summary, the daily chart is bullish. Especially the bullish embedded stochastic oscillator likely will not allow any larger pullback, but rather a consolidation around US$1,900. Watch those two signal lines. Only if one of them would be dropping below 80on a daily close, the bull run might be over!GDX (VanEck Gold Miners ETF) in US-Dollar, daily chart as of February 20th, 2022.GDX, daily chart as of February 20th, 2022.Gold & gold related mining stocks often stabilize your portfolio during uncertain times and do act as a hedge. While the stock market continued its dive due to the crisis in Ukraine and the potential interest rate turnaround in the US, the GDX VanEck Gold Miners ETF is up more than 21.5% since its low in mid of December. Over the last two weeks, the leading gold mining stocks recorded some of their best days in the last 12 months. Last week, Barrick Gold ($GOLD) jumped up more than 7% due to good earnings, a dividend increase, and a new share repurchase program. Some smaller gold stocks like Sabina Gold & Silver ($SGSVF) went up even more (+15% Friday, 11th).Now that gold is on the rise, it’s time for the beaten down and undervalued mining stocks to catch up. Usually, it starts with the big senior produces like Barrick Gold, Agnico Eagle Mines ($AEM) and Newmont Corporation ($NEM), then the juniors like for example Victoria Gold Corp. ($VITFF) join and finally, the explorer and developers literally explode higher.However, the GDX has nearly reached its downtrend line as well as the 38.2% retracement of the whole corrective wave since August 2020. Hence, the big miners are running into string resistance and might need to consolidate soon.At the same time, note, that silver has been lagging. Silver always lags most of the time, but in the final stage of sector wide rally it suddenly passes all the other metals and shots up nearly vertically. That also typically is the sign that the rally in the sector is coming to an end. Obviously, we have not yet seen any strong silver days. Therefore, silver actually confirms that the sector has more room and time to run higher!Conclusion: Bullish momentum remains strongOverall, gold continues to look promising here as the bullish momentum remains strong. Hence, Gold is probably on the way towards US$1,950 and US$1,975, with a slight chance for an overshot to US$2,000. But of course, given the rather overbought daily chart, the risk/reward is not that good anymore. Silver and many of the smaller mining stocks, however, might still offer a chance to play the ongoing rally over the next few weeks. Once gold tops out in spring, expect a big pullback. Maybe even back towards the higher trending 200-day moving average (currently at US$1,808) at some point in midsummer. But that is all somewhere in the future. For now, the bullish momentum remains strong.Feel free to join us in our free Telegram channel for daily real time data and a great community. If you like to get regular updates on our gold model, precious metals and cryptocurrencies you can also subscribe to our free newsletter.Disclosure: Midas Touch Consulting and members of our team are invested in Reyna Gold Corp. These statements are intended to disclose any conflict of interest. They should not be misconstrued as a recommendation to purchase any share. This article and the content are for informational purposes only and do not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision. The views, thoughts and opinions expressed here are the author’s alone. They do not necessarily reflect or represent the views and opinions of Midas Touch Consulting.By Florian Grummes|February 20th, 2022|Tags: $GDXJ, Barrick Gold, GDX, Gold, Gold Analysis, Gold bullish, gold chartbook, gold fundamentals, Newmont Corporation, precious metals, Reyna Gold, Sabina Gold & Silver, Silver, silver bull, US-Dol

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