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Exchange Rates 03.10.2022 analysis

Key reports published in both US and Europe show that inflation continues to spiral and is at staggering levels. This prompted Credit Suisse to issue a gloomy outlook for the global economy, saying the worst is yet to come.

Exchange Rates 03.10.2022 analysis

The Department of Commerce released the latest inflation data, indicating that core PCE jumped 0.6% in August. This suggests that inflation is still intense and increasing, and may even be higher in the next months. Core labor costs, which excludes food and energy costs, also rose 4.9%, up 4.7% from forecasts.

Exchange Rates 03.10.2022 analysis

In Europe, inflation hit a new record high of 10% in September.

Exchange Rates 03.10.2022 analysis

CPI for the Eurozone differs from that of the US as year-on-year energy prices in the region were up 40.8%. In the US, there is a slight decline from 8.5% to 8.3%.

To address inflation, the Fed has implemented five consecutive interest rate hikes, but from last week's report, it is obvious that the aggressive measure is yet to bring inflation down. Vice Chairman Lael Brainard said the

Intraday Market Analysis – EUR Builds Up Bullish Reveal

Intraday Market Analysis – EUR Builds Up Bullish Reveal

John Benjamin John Benjamin 29.10.2021 08:55
EURUSD cuts through resistanceThe euro surges as the market prices in inflation pressure despite the ECB’s dovish message.Bullish candles have pushed the single currency above the triple top (1.1665) which sits on the 30-day moving average, paving the way for a reversal. Strong momentum is a sign of short-covering from those caught on the wrong side of the market.An overbought RSI could temporarily limit the range of the rally. However, renewed optimism may send the pair to the daily resistance at 1.1750. 1.1620 is the support in case of a pullback.USDJPY tests demand zoneThe Japanese yen recouped losses after the BOJ sees a weak yen as positive for Japan’s economy. And the US dollar has come under pressure near a four-year high.An overbought RSI on the daily chart points to an overextension. On the hourly level, the pair has found bids around 113.30 near a previous consolidation range.A bearish breakout would test the round number at 113.00, which lies on the 20-day moving average and is critical in safeguarding the uptrend. The bulls need to lift 114.30 before they may resume the rally.US 30 pulls backs for supportThe Dow Jones consolidates as investors digest earnings near the all-time high.A breakout above the August peak at 35600 and a bullish MA cross from the daily timeframe indicate an acceleration on the upside as the rally continues.Pullbacks could be an opportunity to buy low. An overbought RSI has triggered a minor sell-off below 35600, shaking out weaker hands in the process. A drop below 35450 would lead to the psychological level of 35000. 35830 is now a fresh resistance.
Wild Choppy Moves

Wild Choppy Moves

Monica Kingsley Monica Kingsley 29.10.2021 15:27
One-sided S&P 500 session, perhaps a bit too much – the bulls are likely to face issues extending gains when VIX is examined. The stock market sentiment remains mixed, and one could easily be pardoned for expecting larger gains on yesterday‘s magnitute of the dollar slump. And long-dated Treasuries barely moved – their daily candle approximates nicely the volatility one as both give the impression of wanting to move a bit higher while their Thursday‘s move was a countertrend one.Not even value was able to surge past its Wednesday‘s setback, which makes me think the bears can return easily. At the same time, tech stepped into the void, and had a positive day, balancing the dowwnside S&P 500 risks significantly. The very short-term outlook in stocks is unclear, and choppy trading between yesterday‘s highs and 4,550 shouldn‘t be surprising today.At the same time, precious metals could have had a much stronger day – but the sentiment was risk-off in spite of the tanking dollar and doubted yields as the rising tech and gold at the expense of silver illustrate. Miners recent outperformance was absent just as much as commodities vigor with the exception of copper. And it‘s more celebrations in the red metal following its steep and far reaching correction, that‘s the part of missing ingredients as much as fresh inflation fears (yes, adding to risk-off mood, inflation expectations declined yesterday).All in all, it looks like a case of abundance of caution prior to next week‘s Fed, compounded by sluggish incoming data, where just cryptos are ready to move first.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 decisively reversed upwards, but the daily indicators barely moved – the consolidation doesn‘t look to be over.Credit MarketsHYG entirely reversed Wednesday‘s plunge but the low volume flashes amber light at least – the bulls are likely to stop for a moment.Gold, Silver and MinersGold upper knot doesn‘t bode as well as it did the prior Friday, and the same goes for miners. The yellow metal‘s strength was sold into, making it short-term problematic for the bulls.Crude OilCrude oil held $81 on not too shabby volume but the bulls are still on the defensive until $84 is overcome. When XLE starts outperforming VTV again, the outlook for black oil would improve considerably. Natgas falling this steeply yesterday isn‘t inspiring confidence either.CopperCopper finally reversed, and the upswing is a promising sign even though I would like to have seen higher volume. Again, the red metal remains well positioned to join in the commodities upswing once the taper announcement is absorbed.Bitcoin and EthereumBitcoin bulls are pausing while Ethereum ones keep running – cryptos are providing an encouraging sign (to be taken up by real assets) going into the Fed next week.SummaryChoppy trading in stocks is likely to continue even though 4,610s are closer than a break below 4,550s at the moment. Much nervousness in the markets before the coming Wednesday – cash is being raised while the dollar suffered in spite of daily move up in yields. Risk-off hasn‘t clearly retreated as seen in sectoral performance and VIX – time to be cautious while waiting out this soft patch in commodities that are most likely to return to scoring gains, accompanied by the retreating dollar.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.
Intraday Market Analysis – USD Grinds Key Resistance

Intraday Market Analysis – USD Grinds Key Resistance

John Benjamin John Benjamin 01.11.2021 09:31
USDCHF bounces off demand zoneThe US dollar inched higher after a solid core PCE reading in September. The pair is testing the major demand area from last August’s lows (0.9100).A bearish MA cross on the daily chart has dented buyers’ optimism. An oversold RSI may attract a ‘buying-the-dips’ crowd while short-term sellers take some chips off the table.However, 0.9190 could be a challenging hurdle to lift as the bears would be eager to fade the rebound. A new round of sell-off would send the greenback to the daily support at 0.9020.EURGBP attempts to reboundThe euro found support from better-than-expected growth and inflation data. A bullish RSI divergence suggests that the downtrend may have lost its momentum.A break above 0.8470 has prompted sellers to cover some of their bets. But the RSI’s overbought situation has so far tempered the optimism.The bulls will need to lift offers around 0.8485 which sits on the 30-day moving average before they could turn the tables. Failing that, a drop below the demand zone between 0.8400 and 0.8420 would deepen the correction.GER 40 finds supportThe Dax 40 bounces back thanks to upbeat European stock earnings.A bullish MA cross on the daily chart is a sign of recovery. Though the index has hit a speed bump at 15775 which is a major resistance from last September’s sell-off.The drop below 15630 has led intraday buyers to bail out, driving short-term price action downward. As the RSI ventured into the oversold zone, the pullback attracted dip-buying interest at the lower range of the previous consolidation (15400). This is a congestion area along the MA cross.
Profit-Taking After Earnings May Send Stock Prices Lower

Profit-Taking After Earnings May Send Stock Prices Lower

Paul Rejczak Paul Rejczak 29.10.2021 15:30
  Stocks retraced their short-term decline yesterday, but today we may see a lower opening following the earnings releases. Is this a topping pattern? The S&P 500 index gained 0.98% on Thursday, Oct. 28, as it retraced its whole Tuesday’s-Wednesday’s decline to the support level of 4,550. It got back to the Tuesday’s record high of 4,598.53 yesterday. The daily close was just 2 points below that level. The stock market is still reacting to quarterly corporate earnings releases. Yesterday we got the releases from AAPL and AMZN, among others. But the first reaction to their numbers was negative. The market seems overbought in the short-term it is most likely fluctuating within a topping pattern. The nearest important support level is at 4,550, and the next support level is at 4,520-4,525, marked by the previous Wednesday’s daily gap up of 4,520.40-4,524.40. On the other hand, the resistance level is at around 4,600, marked by the new record high. Despite reaching new record highs, the S&P 500 remained below a very steep week-long upward trend line, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Nasdaq Reached New Record! Let’s take a look at the Nasdaq 100 chart. The technology index was relatively weaker than the broad stock market recently, as it was still trading below the early September record high of around 15,700. But this week it rallied to the new record highs. The nearest important support level is now at 15,700, marked by the recent resistance level, as we can see on the daily chart: Dow Jones Is Relatively Weaker Again The Dow Jones Industrial Average reached the new record high of 35,892.92 on Tuesday and on Wednesday it sold off to around 35,500. Yesterday the blue-chip index didn’t retrace that decline. The support level remains at around 35,500-35,600, marked by the previous local highs, as we can see on the daily chart: Apple Rallied Before Earnings, and Microsoft Went Hyperbolic Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple released its earnings after yesterday’s close and the first reaction was negative. But the stock gained 2.50% at yesterday in regular trading hours. The resistance level remains at $154-156. It is still trading below the record highs, as we can see on the daily chart: Now let’s take a look at the MSFT. It rallied after Tuesday’s quarterly earnings release and on Wednesday it reached the record high price of $326.10. The market remained above its month-long upward trend line. Microsoft extends its long-term hyperbolic move higher. This week it got close to the $2.5 trillion dollar market cap! So the question is how much higher can it get? And it’s already not that cheap at all with its price to earnings ratio of around 40. Conclusion The S&P 500 index retraced its Tuesday’s-Wednesday’s decline yesterday and it got close to the Tuesday’s record high of 4,598.53. For now, it looks like a consolidation following an uptrend. However, the market is still overbought and we may see a bigger downward correction. There may be a profit-taking action following quarterly earnings releases. Today the main indices are expected to open 0.2-0.8% lower after yesterday’s earnings releases from AAPL and AMZN, and we will likely see an intraday correction. Here’s the breakdown: The S&P 500 got close to the record high yesterday but today it may retrace some of the advance. A speculative short position is justified from the risk/reward perspective. We are expecting a 3% or higher correction from the current levels. 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.
Don‘t Fear Risk-Off

Don‘t Fear Risk-Off

Monica Kingsley Monica Kingsley 01.11.2021 13:50
Not confirmed by bonds, the S&P 500 advances regardless – the daily yields retreat is powering tech while value goes nowhere. Higher beta sectors such as financials are sputtering, revealing the defensive nature of the stock market advance – at least to this degree, stocks and bonds are in tune. Yes, risk-off is winning these days, and it would be only up to VIX to join the fray, but the key volatility measure is likely to keep complacently trading around the 17 level. In other words, not too far from the bottom of its recent range, and not indicating imminent change of the bull market character.While we have seen much better market breadth readings in the years gone by (the narrow leadership is reminiscent perhaps of the late 1990s), there‘s no chart proof of the behemoths being in kind of getting really serious trouble (with the possible exception of Facebook). True, smallcaps have largely gone sideways over the many months, but midcaps are already breaking higher, and that won‘t be unnoticed by the Russell 2000 (soon to follow).The bears haven‘t thus far made any serious appearance, and 4,550s held with ease in spite of the dollar reversing Thursday‘s losses. All the more encouraging is the relative strength of both gold and silver when faced with one more daily decline in inflation expectations – as if balancing before the Fed act changes anything.I ask, how serious can they be about delivering on taper promises when prices increase relentlessly (look at Europe too), these are being blamed on supply chain bottlenecks without acknowledging their persistent and not transitory nature, and the real economy is markedly slowing down (not in a recession territory, but still)?Looking at commodities, we‘re reliving the 1970s, and cryptos are still the key beneficiary of monetary largesse – precious metals aren‘t a dead asset class in the least, they just frontrunned it all and peaked in August 2020 as I alerted you to back then. Fresh upswing is in the making.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 once again decisively reversed upwards, and even though the daily indicators are weakening, the rally can easily go on. Dips are to be bought.Credit MarketsHYG keeps acting weak, but this is being overlooked by stocks as tech remains driven by NYFANG.Gold, Silver and MinersGold‘s lower knot indicates accumulation, and miners reversing higher would be a great confirmation. Regardless, such a result when dollar rose steeply and yields with inflation expectations retreated, is encouraging.Crude OilCrude oil again held $81, looks set to return above $84 again. XOI and XLE weakness has to be understood in terms of the challenged VTV, and isn‘t here to stay.CopperCopper is providing a buying opportunity, and looks likely to join other base metals (especially alluminum) and broader commodity index strength as agrifoods wake up too.Bitcoin and EthereumThe Bitcoin and Ethereum upswings can go on – it looks to be a question of a relatively short time when cryptos are done with the sideways correction.SummaryS&P 500 indeed got at 4,610s instead of suffering setbacks, and the same holds true for real assets next. Across the board, these have performed well in spite of the USD upswing and decreasing inflation expectations, which I chalk down to pre-Wednesday positioning. Therefore, I‘m taking the high beta weakness with a pinch of salt, and the same goes for precious metals or the economic cycle sensitive copper. As for oil, the U.S. economy can (and will have to) withstand prices higher than $90 as 2022 arrives.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.
Intraday Market Analysis – USD Hits Resistance - 02.11.2021

Intraday Market Analysis – USD Hits Resistance - 02.11.2021

John Benjamin John Benjamin 02.11.2021 08:42
USDCAD consolidates at 4-month lowThe US dollar retreats ahead of this week’s FOMC as traders await further catalysts. Price action has stabilized above 1.2300, a major demand zone from last summer.1.2430 from the latest sell-off is a key resistance as it coincides with the 20-day moving average. The current consolidation suggests the market’s indecision, though overall sentiment remains bearish.A deeper correction would send the greenback to 1.2150. A bullish breakout on the other hand may challenge the supply area around 1.2550.EURJPY tests key supportThe euro struggles to bounce higher after Germany’s lackluster retail sales in September.The pair has come under pressure at 133.45 near June’s peak. The subsequent retracement has met some bids at 131.60 when the RSI dipped into the oversold territory.The triple test of the support level indicates solid buying interest. However, the bulls will need to push above 132.80 before the uptrend could resume.On the downside, a bearish breakout would extend the sideways action towards 130.80 which sits on the 30-day moving average.US 100 falls back for supportThe Nasdaq 100 surges to a new all-time high as investors expect the strong growth trend to continue. The break above the previous peak at 15700 has put the index back on an upward trajectory.A bullish MA cross on the daily chart is a confirmation of the market’s optimism. However, a brief pullback is necessary to let the bulls catch their breath.15620 is the immediate support. Further down, 15280 is key daily support on the 20-day moving average. The psychological level of 16000 would be the next target rebound.
What Does November Hold for the Miners?

What Does November Hold for the Miners?

Paul Rejczak Paul Rejczak 01.11.2021 16:20
  As a new month begins, the downtrend in the GDX and GDXJ should resume. When will a new buying opportunity finally present itself? Let’s compare the behavior of the GDX ETF and the GDXJ ETF. Regarding the former, the GDX ETF reversed sharply after reaching its 200-day moving average and a confluence of bearish indicators signaled a similar outcome. For context, I wrote on Oct. 25: Small breakout mirrors what we witnessed during the senior miners’ downtrend in late 2020/early 2021. Moreover, when the GDX ETF’s RSI (Relative Strength Index) approached 70 (overbought conditions) back then, the highs were in (or near) and sharp reversals followed. Furthermore, after a sharp intraday reversal materialized on Oct. 22, the about-face is similar to the major reversal that we witnessed in early August. On top of that, with the GDX ETF’s stochastic indicator also screaming overbought conditions, the senior miners are likely to move lower sooner rather than later. Also, please note that the GDX ETF reversed right after moving close to its 200-day moving average, which is exactly what stopped it in early August. Yes – that’s another link between now and early August. And after declining sharply on Oct. 28 and Oct. 29, the senior miners further cemented their underperformance of gold. Moreover, with relative underperformance often a precursor to much larger declines, the outlook for the GDX ETF remains quite bearish. Please see below: As further evidence, the GDX ETF’s four-hour chart offers some important insights. To explain, the senior miners failed to hold their early September highs and last week’s plunge removed any and all doubt. Likewise, the GLD ETF suffered a sharp drawdown and its recent breakout was also invalidated. Furthermore, my three-day rule for confirming breakouts/breakdowns proved prescient once again. Conversely, investors that piled into mining stocks are likely regretting their decision to act on unconfirmed signals. And as we look ahead, the technicals imply that caution is warranted and more downside is likely for the GDX ETF. As for the GDXJ ETF, the gold junior miners suffered a similar swoon last week. For context, I warned of the prospective reversal on Oct. 25. I wrote: The junior miners’ RSI also signals overbought conditions and history has been unkind when similar developments have occurred. Moreover, the GDXJ ETF’s recent rally follows the bearish patterns that we witnessed in late May and in early 2021. Likewise, the intraday reversal on Oct. 22 mirrors the bearish reversal from early August and a confluence of indicators support a continuation of the downtrend over the coming weeks. And as we begin a new month, the GDXJ ETF’s downtrend should resume and a retracement to the ~35 level will likely materialize in the coming months. Please see below: Finally, while I’ve been warning for months that the GDXJ/GDX ratio was destined for devaluation, the ratio has fallen precipitously in 2021. And after the recent short-term rally, the ratio’s RSI has reached extremely elevated levels (nearly 73) and similar periods of euphoria have preceded major drawdowns (marked with the black vertical dashed lines below). To that point, the ratio showcased a similar overbought reading in early 2020 – right before the S&P 500 plunged. On top of that, the ratio is still below its mid-to-late 2020 lows and its mid-2021 lows. As a result, the GDXJ ETF will likely underperform the GDX ETF over the next few months. It’s likely to underperform silver in the near term as well. The bottom line? If the ratio is likely to continue its decline, then on a short-term basis we can expect it to trade at 1.27 or so. If the general stock market plunges, the ratio could move much lower, but let’s assume that stocks decline moderately or that they do nothing or rally slightly. They’ve done all the above recently, so it’s natural to expect that this will be the case. Consequently, the trend in the GDXJ to GDX ratio would also be likely to continue, and thus expecting a move to about 1.26 - 1.27 seems rational. If the GDX is about to decline to approximately $28 before correcting, then we might expect the GDXJ to decline to about $28 x 1.27 = $35.56 or $28 x 1.26 = $35.28. In other words, ~$28 in the GDX is likely to correspond to about $35 in the GDXJ. Is there any technical support around $35 that would be likely to stop the decline? Yes. It’s provided by the late-Feb. 2020 low ($34.70) and the late-March high ($34.84). There’s also the late-April low at $35.63. Consequently, it seems that expecting the GDXJ to decline to about $35 is justified from the technical point of view as well. In conclusion, mining stocks reprised their role as ‘The Boy Who Cried Wolf.’ And after overzealous investors rushed to their defense last week, another false alarm led to another bout of disappointment. Moreover, with the technical and fundamental backdrops for gold, silver and mining stocks continuing to deteriorate, lower lows should materialize over the medium term. As a result, we may have to wait until 2022 before reliable buying opportunities emerge once again. 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.
Bitcoin’s trading psychology - 02.11.2021

Bitcoin’s trading psychology - 02.11.2021

Korbinian Koller Korbinian Koller 02.11.2021 09:49
BTC in US-Dollar, Daily Chart, leg analysis:Bitcoin in US-Dollar, Daily chart as of October 25th, 2021.From a pure price perception, it might seem that the consistency bitcoin holds in price bubbles might be of the same origin, but they are not. In 2009, the value of the coin was zero, and fans exchanged it more like reminding of a seedy Star Wars bar exchange of true fans for a new idea, technology, beliefs, and freedom. Even so, bubbles arose a year later, and the price was driven by extreme supply and demand imbalances due to ill-liquidity when news hit the media.Since these times, we have seen all sorts of traders, speculators, investors, banks, hedge funds, governments join the speculation in a profitable market. Each with their specific mindset, interests, and trading psychology. The latest shift is now the race of governments getting a hold on the worldwide dominance reign. They will be true hodlers. Before that last influx, the bitcoin market was dominated by pure speculators for the most part. In a sense, they were forced into this market to stay competitive. Wide swings were the result since there was little incentive to stay in this game for the long term or, in other words, taking the risk on the large downswings.One first step, identifying in which market and cycle one is competing, are comparing up-legs in size (percentage) and steepness (time).The daily chart above shows such measurements of the last two significant moves in bitcoin this year.It has taken bitcoin only three months to more than double in price.BTC in US-Dollar, Weekly Chart, Projections:Bitcoin in US-Dollar, weekly chart as of October 26th, 2021.With governments and the wider population now being the last to come to the party, we will see a shift in the trading behavior of bitcoin. This needs adjustment in one’s trading style to be part of this craze for the virtual, decentralized future.One such shift in the process may be a reduction of retracements depth within the second leg from a weekly perspective. We have drawn a projection of the second leg highly conservative in the chart above. Conservative, since second legs are typically longer, and we only assumed an identical extension to the first leg (1=2=3 in length and angle). BTC in US-Dollar, Monthly Chart, time accuracy:Bitcoin in US-Dollar, monthly chart as of October 26th, 2021.Bitcoins’ childhood days have long passed. Seedy bar purchases have changed for high liquidity and professional exchanges with advanced order execution functionality. The big guns sit on the table, and as such, trading has shaped up. The individual is now playing against the best in the world, like in any other asset class, and risk should be perceived as such.Nevertheless, a larger time frame play for wealth preservation and a hedge against inflation is controllable in risk. Market participation analysis allows for a better grip on what to expect and scales in on targets from a time perspective. The above monthly chart illustrates our view of a possible future. The logarithmic chart shows best what inherent strength bitcoin possesses.Bitcoin´s trading psychology:The largest group that is not invested in bitcoin yet is the more significant part of average citizens. Consequently, we will find ourselves in an extreme supply demand imbalance due to bitcoins fixed limit of 21 million coins. More importantly, we will discover new trading behavior with a new group participating, with new psychology. These purchases will be made by amateurs who are motivated by fear more than greed. This market participant will be a long-term speculator trying to hold on to his investment versus making a quick buck. We anticipate more moderate overall retracements percentagewise. As well, we expect steeper legs up. These will result in a different system needed to participate in a market with low-risk entry points.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 subscribe to our free newsletter.This article does 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 Korbinian Koller|October 26th, 2021|Tags: Bitcoin, bitcoin consolidation, Bitcoin mining, crypto analysis, Crypto Bull, crypto chartbook, crypto mining, low risk, quad exit, technical analysis, trading education|0 CommentsAbout the Author: Korbinian KollerOutstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent. Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.
The US dollar retreats ahead of this week’s FOMC as traders await further catalysts

The US dollar retreats ahead of this week’s FOMC as traders await further catalysts

FXMAG Team FXMAG Team 02.11.2021 10:19
EURJPY tests key support. USDCAD consolidates at 4-month low 1.2430 from the latest sell-off is a key resistance as it coincides with the 20-day moving average. The current consolidation suggests the market’s indecision, though overall sentiment remains bearish. A deeper correction would send the greenback to 1.2150. A bullish breakout on the other hand may challenge the supply area around 1.2550. EURJPY tests key support The euro struggles to bounce higher after Germany’s lackluster retail sales in September. The pair has come under pressure at 133.45 near June’s peak. The subsequent retracement has met some bids at 131.60 when the RSI dipped into the oversold territory. The triple test of the support level indicates solid buying interest. However, the bulls will need to push above 132.80 before the uptrend could resume. On the downside, a bearish breakout would extend the sideways action towards 130.80 which sits on the 30-day moving average. US 100 falls back for support The Nasdaq 100 surges to a new all-time high as investors expect the strong growth trend to continue. The break above the previous peak at 15700 has put the index back on an upward trajectory. A bullish MA cross on the daily chart is a confirmation of the market’s optimism. However, a brief pullback is necessary to let the bulls catch their breath. 15620 is the immediate support. Further down, 15280 is key daily support on the 20-day moving average. The psychological level of 16000 would be the next target rebound.
Silver’s fuse is about to be lit

Silver’s fuse is about to be lit

Korbinian Koller Korbinian Koller 30.10.2021 16:45
The average investor is news-driven. As much as the Federals Reserve  (the Fed) might be criticized, this large investor group is not commonly doubting news. In other words, it has generally believed the Fed’s narrative that inflation is transitory. The bad news is rarely released shortly before Christmas. However, it would not surprise if tapering started in early 2022. And maybe not just begin but be more aggressive throughout the year as expected. With this, the narrative will change from a “we are not worried, it is transitory” to a “we need to deal with” regarding inflation. Therefore, this could easily be the fire to the fuse of the Silver rocket. We now see early signs of such a lift-off in price in recent silver price movements. Silver’s fuse is about to be lit. Silver in US-Dollar, daily chart, low-risk entry points: Silver in US-Dollar, daily chart as of October 30th, 2021. It isn’t only that the overall narrative on transitory inflation is starting to get holes. We like the silver play, for instance because gold is somewhat in the limelight in battle with bitcoin. Consequently, allowing for silver to shine while it is typically in the shadow. On top of it all, we find clear evidence that commodities with industrial use are likely in a long term bull market. This is a play where everything is coming together. A multi stream both in fundamental and technical edges stack upon each other. As of right now, we have identified four low-risk entry points on the daily silver chart, which are marked in bright green horizontal lines. We would take off 50% of the position near the US$26 mark to mitigate risk (see our quad exit strategy). Silver in US-Dollar, weekly chart, good risk reward ratio: Silver in US-Dollar, weekly chart as of October 30th, 2021. The weekly chart offers a low-risk opportunity as well. We illustrated above a play that assumes an entry point in the lower third quadrant of the yellow marked sideways zone. It would provide for a risk/reward-ratio between 1:1 and 1:2 towards the financing point. As well we assume an exit of half of the position at the top near US$28 of the yellow sideways channel (see our quad exit strategy). With two more exits of each 25% of total trade equity at targets US$34.83 and US$48.72, we find the weekly play to be conducive to our low-risk policy.  Silver in US-Dollar, monthly chart, favorable probabilities: Silver in US-Dollar, monthly chart as of October 30th, 2021. With its most considerable weight, the monthly chart provides the necessary overview. It shows how likely a success rate to a long-term play outcome is. We find three dominant aspects supporting our aim for a bullish long-term play. Trend: The linear regression channel is marked in diagonal lines (red, blue, green). It shows a clearly bullish trend with a high likelihood of continuation. Support: The Ichimoku cloud analysis provides solid evidence of support to the recently established bullish tone in silver. Probabilities: Price highs from 1980 to 2011 built a double top price formation. As a result, it prevented prices from getting higher than the price zone marked with a white box. The third attempt of price reaching this price zone nevertheless has a much higher statistical probability of penetrating this distribution zone and allowing the price to go higher. Silver’s fuse is about to be lit: We find ourselves in challenging times. Certainly, not only in market play. One of the essential pillars to come out ahead is bending in the wind and staying flexible. Should the FED indeed raise interest rates to a degree non-reflected in the anticipated market price of speculators and come as a surprise, we might see a stock market decline next year of a substantial percentage. Consequently, this would temporarily drag silver prices down as well. We share methods in our free Telegram channel to build low-risk positions within the market that reduce risk through partial profit-taking. Our quad exit strategy allows us to hedge physical acquisitions by trading around these positions on smaller time frames in the silver paper market. Our approach provides a way to maneuver through a delicate environment to hedge against inflation and preserve wealth. 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. This article does 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.
Fed Game Plan

Fed Game Plan

Monica Kingsley Monica Kingsley 02.11.2021 14:54
S&P 500 hesitation against weakening bonds – what gives? The yield curve keeps flattening, but long-dated Treasury yields seem again on the verge of another upswing, which hasn‘t propped up the dollar yesterday much. The only fly in the ointment of a risk-off atmosphere, was value outperforming tech. Overall, stocks haven‘t made much progress, and are vulnerable to a quick downswing attempt, which probably though wouldn‘t come today as the VIX doesn‘t look to favor it. Wednesday, that could be another matter entirely. Still, there is no imminent change to the stock bull run on the horizon – the focus remains on ongoing Fed accomodations, which s why: (…) The bears haven‘t thus far made any serious appearance, and 4,550s held with ease in spite of the dollar reversing Thursday‘s losses. All the more encouraging is the relative strength of both gold and silver when faced with one more daily decline in inflation expectations – as if balancing before the Fed act changes anything. I ask, how serious can they be about delivering on taper promises when prices increase relentlessly (look at Europe too), these are being blamed on supply chain bottlenecks without acknowledging their persistent and not transitory nature, and the real economy is markedly slowing down (not in a recession territory, but still)? Tomorrow‘s Fed taper announcement wouldn‘t change a lot – so much can (and will) happen in the meantime, allowing them to backpedal on the projections, making rate hikes even more of a pipe dream. The Fed isn‘t taking inflation seriously, hiding behind the transitory sophistry, and that‘s one of the key drivers of rates marching up, rising commodities, and surging cryptos. Look for more oil and natgas appreciation while copper goes up again too. Precious metals are still waiting for a catalyst (think dollar weakening when even rising rates won‘t provide much support, and inflation expectations trending up faster than yields) – a paradigm shift in broader recognition of Fed obfuscation and monetary policy being behind the curve. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 is entering a brief consolidation, with 4,590s being first support, followed by the high 4,550s (if the bears can make it there). Given though yesterday‘s sectoral rotation, that‘s not likely happening today. Credit Markets HYG keeps acting really weak, volume is picking up, and buyers aren‘t able to force at least a lower knot. Rising yields aren‘t reflecting confidence in the economic recovery, but arrival of stagflation bets. Gold, Silver and Miners Gold indeed swung higher, but needs more follow through including volume, otherwise we‘re still waiting for the catalysts mentioned at the opening part of today‘s analysis, which would also help the silver to gold ratio move higher. Crude Oil Crude oil keeps going up again,and is likely to extend gains above $84 even as this level presents a short-term resistance. Copper Copper buying opportunity is still here, and the red metal is primed to play catch up to the CRB Index again. Probably not so vigorous as before, and taking more time to unfold, but still. Bitcoin and Ethereum The Bitcoin and Ethereum upswings can and do go on – as stated yesterday, it was a question of a relatively short time when cryptos are done with the sideways correction. Summary S&P 500 is likely to pause today, and the bond market performance would be illuminating. Ideally for the bulls, some semblance of stabilization would occur, tipping the (bullish) hand for tomorrow. That‘s the big picture view - the very initial reaction to taper announcement would likely be disappointing, and eventually reversed. Cryptos, commodities (first oil, then copper) would react best, with precious metals figuring it out only later. 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.
What Might it Take for the Fed to Deliver a Hawkish Tapering Announcement?

What Might it Take for the Fed to Deliver a Hawkish Tapering Announcement?

Marc Chandler Marc Chandler 03.11.2021 14:43
Overview: With the FOMC's decision several hours away, the dollar is trading lower against nearly all the major currencies.  The Antipodeans and Norwegian krone are leading.  The euro, yen, and sterling are posting minor gains (less than 0.1%).  Most of the freely liquid and accessible emerging market currencies are also firmer.  The Turkish lira is a notable exception.  The decline in the core inflation and a smaller than expected rise in the headline pace embolden officials for another rate cut when the central bank meets on November 18.  The JP Morgan Emerging Market Currency Index is rising for the second consecutive session after falling in the previous four sessions.  Equities are lower.  The MSCI Asia Pacific Index fell for the fifth session in the past six.  Among the large markets, Taiwan and Australia bucked the trend.  The four-day advance of the Stoxx 600 in Europe is at risk, and US futures are weaker.   Benchmark 10 year yields are mostly two-four basis points lower across most high-income countries today.  That puts the US 10-year Treasury yield near 1.52%.  Australia's two-year yield fell almost 10 bp to 0.55%.  It had peaked above 0.71% last week.   The three-year yield is off nearly 30 bp in recent days.  Gold continues to chop within the range set last Friday (~$1772-$1801).  Ahead of the OPEC+ meeting tomorrow amid talk that the US may seek to coordinate sales for a coalition of strategic reserves and a build of US inventories reported by API weigh on oil prices.  December WTI has approached the 20-day moving average (~$82), which has not closed below since late August. Base metals are higher as iron ore snapped a five-day slide during which it lost over 20%.  Copper is also recovering after forging a base in the $432-$433 area.  It is up around 1.5% today.  If sustained, it would be the largest gain in three weeks.   Asia Pacific China's Caixin services unexpectedly rose to 53.8 from 53.4 in September.  Recall that the manufacturing reading had improved to 50.6 from 50.0.  The net effect was that the composite edged up to 51.5 from 51.4.  The composite has converged with the "official" PMI, which stands at 50.8.  Separately, note that China is experiencing a broad spread of the virus into a dozen provinces, and the number of new cases is the highest in a couple of months. Inter-provincial travel has been restricted, and new social protocols are being introduced.  According to reports, the government advised households to stock up in necessities and ensure adequate food supplies for local authorities.  Australia's service and composite PMI shows the recovery was not quite as strong as the preliminary data suggested.  The service PMI rose to 51.8, not 52.0  from 45.5.  The composite stands at 52.1 rather than 52.2.  It was at 46 in September.   Tomorrow Australia reports Q3 real retail sales, but it will still be picking up the weakness of the lockdown.  September trade figures will also be reported.  Weaker exports and stronger imports are expected to have narrowed the trade surplus by almost 20% to A$12.4 bln. Ahead of the weekend, the central bank will make its Monetary Policy Statement.  The swaps market is pricing in 70 bp, down from 80 bp, of tightening over the next 12 months.  The dollar has been confined to a narrow quarter yen range through the Asian session and most of the European morning.  Softer yields and equities would be expected to give the yen a bit of support.  The 20-day moving average is near JPY113.65, and the greenback has not closed below it since the September FOMC meeting.  In the bigger picture, we have suggested the dollar-yen rally from mid-September through mid-October puts the dollar in a new range.  We suspected JPY114.50-JPY115.00 marks the upper end and JPY113.00 may be the lower end.  The Australian dollar fell almost 1.4% yesterday, its largest decline since May.  It reached $0.7420 yesterday, just above the $0.7410 (38.2% retracement objective of last month's rally).  It has stabilized today and has (so far) been capped near $0.7450.  Resistance is seen in the $0.7460-$0.7470 area.   For two weeks, the Chinese yuan has been alternating between advances and declines, and net-net little changed over the period.  Yesterday, the yuan slipped (0.04%), and today it is firmer (0.06%).  The PBOC has consistently set the dollar's reference rate above model projections, and today's fix was at CNY6.4079 compared with median expectations (Bloomberg) for CNY6.4068.  The PBOC was unexpectedly generous in its open market operations, injecting CNY50 bln. As a result, the overnight repo rate fell 12 bp to 1.99%.   Europe Norway's central bank meets tomorrow.  It was the first of the high-income countries to raise rates this year, so far, followed only by New Zealand.  We overstated the case for Norway to hike rates at the meeting, but don't be mistaken. The case for a rate hike exists, but the pattern is not to move at these "off-meetings" (without updated formal policy path guidance).  Instead, officials will likely confirm their intentions to raise rates in December. The swaps market is pricing in almost three hikes next year.   The dollar trended lower against the Nokkie since August 20. The downward momentum stalled in late October.  Yesterday it rose above NOK8.50 for the first time since mid-October.  The momentum indicators have turned up.  The 200-day moving average is slightly below NOK8.55 and near NOK8.60 is the (38.2%) retracement of the down move.  The UK is emerging from the economic soft patch in the June-August period.  The final service and composite PMI report today showed stronger activity than the preliminary estimates.  The service PMI rose to 59.1 from 55.4 in September.  The flash estimate had put it at 58.0.  The composite stands at 57.8, up from the preliminary projection of 56.8 and September 54.9.    The Bank of England meets tomorrow.  There does not seem to be much conviction, and the market appears divided. In the Bloomberg survey, 22 out of 45 economists expect a hike that seems to have been largely discounted by the markets (15 bp).  Three of the largest UK banks do not expect a hike.  Some observers argue that what is the point of stopping now when it would end next month. We often think the signaling channel of QE is under-appreciated.  Stopping the bond-buying now adds to the seriousness of the moment if it does not lift rates. Sterling has retreated by 2.3 cents since last week's high to approach $1.36 yesterday in the US. The euro reached its lowest level against sterling since March 2020 in late October near GBP0.8400, and yesterday rose to above GBP0.8500 for the first time since October 12.   Poland's central bank is expected to hike the base rate 25 bp today to 0.75%.  Recall that it hiked 40 bp last month to begin the cycle.  It started later than Czech and Hungary.  Preliminary October CPI rose 1% on the month, accelerating the year-over-year pace to 6.8% (from 5.9% in September.  It was at 5% as recently as July.  The Czech central bank meets Friday and is expected to hike the repo rate 75 bp to 2.25%.  After two quarter-point hikes (June and August), it hiked by 75 bp in September. Inflation (CPI) rose to 4.9% in September from 4.1% in August.  It is the highest since 2008.  Turkey's CPI rose by 2.39% last month to bring the year-over-year rate to 19.89% (19.58% in September), slightly lower than expected.  The core rate slipped slightly to 16.82% from 16.98%.   The euro has been confined to about a quarter of a cent range above $1.1575 so far.  It stalled yesterday near $1.1615, the (50%) retracement of the pre-weekend slide from almost $1.1700 to $1.1535.  It is making session highs in the European morning, but we look for a less friendly North American session.  There are options for about 530 mln euros at $1.16 that expire today.  A hawkish Fed (see below) could bring option expirations tomorrow at $1.1525 (~825 mln euros ) and $1.1550 (~900 mln euros) into play.  Sterling tested $1.36 yesterday, the lowest level since October 13.  It has hardly managed to distance itself from the lows.  It found new offers near $1.3635.   There is a GBP675 mln option expiring today at $1.3650.  A larger one (~GBP820) is at $1.3615 also expires but has liked been neutralized.   America It seems well appreciated that the Federal Reserve will announce it will begin slowing the bond purchases. Most expect a reduction of $10 bln of Treasuries and $5 bln of Agency MBS.  Investors appear to be anticipating the monthly reduction of these amounts through June 2022.  Even with yesterday's upticks, the June Fed funds futures contract continues to discount a rate hike then.  If the effective Fed funds rate is steady in the first half of June at eight basis points and then rises to 33 bp for the second half of the month (25 bp rate hike on June 15), the average effective rate is about 20.5 bp.  The contract settled at an implied rate of 20 bp yesterday.   Since this is already in the market, the tapering announcement itself may not be hawkish.  There are two steps the Fed could take if it wanted to drive home the point.  First, the FOMC statement has been referring to inflation as largely "transitory."  It could simply drop this qualifier or modify it.  The Chair has already acknowledged that it will likely persist longer than initially anticipated.  Indeed, next week's CPI report is expected (Bloomberg survey median) is expected to have risen by 0.5%, which, given the 0.1% increase in October 2020, means the 12-month rate will accelerate to around 5.8%.   Second, after the last press conference, Powell was asked about needing to reduce monetary stimulus while the Fed was still engaged in QE.  The Bank of England said it would hike if necessary while it was still buying bonds.  Powell said in that situation, the Fed would not send contradictory signals but accelerate the tapering process.  Quicker tapering would be a hawkish signal, and reaction by the market would likely bring forward the first hike.   The Democratic Party lost the Virginia gubernatorial context.  Biden had carried the state by 10 percentage points last year, and the preliminary results suggest a loss of suburban voters, a key part of the new Democratic coalition.  New Jersey's governor contest is very close, and the Democratic incumbent is trailing. The results play on ideas that the Democrats are likely to lose both houses of Congress in next year's mid-term election, in which it is common for the party in the White House to lose seats.  Some in the press have been critical that Xi and Putin are not attending COP-26, but their leadership was always in doubt.  The election results may undermine US leadership because Biden's commitments may not get legislative support, and executive decisions could be reversed in 2024.   Today could be the first day since October 13 that the US dollar does not trade below CAD1.2400.  Still, note that the greenback remains in the CAD1.2300-CAD1.2435 range set last Wednesday when the Bank of Canada turned more hawkish.  Yesterday, the US dollar closed above its 20-day moving average for the first time since late September.  We suspect corrective forces could lift the exchange rate toward CAD1.2475, where the (38.2%) retracement of last month's decline is found, and the 200-day moving average (~CAD1.2485).  However, in its way stands the $920 mln option at CAD1.2450 that expires today.  The greenback reached almost MXN20.92120 yesterday, a new eight-month high. Sellers emerged, and the dollar closed lower to snap a five-day advance.  It is softer today but holding above yesterday's low (~MXN20.71).  Ahead of the FOMC outcome, the market may be cautious about taking the dollar below the MXN20.66-MXN20.70 area.   Disclaimer
Lip Service to Inflation, Again

Lip Service to Inflation, Again

Monica Kingsley Monica Kingsley 03.11.2021 14:54
S&P 500 quick downswing attempt indeed didn‘t come – fresh highs were confirmed by bonds. Even if just on a daily basis, that‘s where the bias is – long stocks still, but with a wary eye as Treasuries and corporate bonds need to kick in on a more than daily basis. I‘m taking it as that the bullish expectations for today are really high – so much so that better than expected non-farm employment change resulted in a sell the news reaction. So, how does that line up with today‘s FOMC? Dovish undertones are obviously expected – at least in attempting to sweep the hot inflation under the rug, spinning it somehow else than with the tired transitory horse. Discredited one too. So, how would the taper message be delivered, and could it go as far as $15bn a month asset purchase reduction while avoiding rate hike mentions as much as possible? Even if $15bn is indeed the announced figure, I‘m looking for the Fed to soften it before it can run its course, i.e. before 2H 2022 arrives – the economy isn‘t in such a great shape to take it, and the fresh spending bill (whatever the price tag), needs central bank‘s support too. Let‘s recall my yesterday‘s words about how that‘s likely to translate into market moves: (…) Overall, stocks haven‘t made much progress, and are vulnerable to a quick downswing attempt, which probably though wouldn‘t come today as the VIX doesn‘t look to favor it. Wednesday, that could be another matter entirely. Still, there is no imminent change to the stock bull run on the horizon – the focus remains on ongoing Fed accomodations. Tomorrow‘s Fed taper announcement wouldn‘t change a lot – so much can (and will) happen in the meantime, allowing them to backpedal on the projections, making rate hikes even more of a pipe dream. The Fed isn‘t taking inflation seriously, hiding behind the transitory sophistry, and that‘s one of the key drivers of rates marching up, rising commodities, and surging cryptos. Look for more oil and natgas appreciation while copper goes up again too. Precious metals are still waiting for a catalyst (think dollar weakening when even rising rates won‘t provide much support, and inflation expectations trending up faster than yields) – a paradigm shift in broader recognition of Fed obfuscation and monetary policy being behind the curve. The Fed turning even more dovish than expected, would light the fireworks – they‘re likely to pay lip service to inflation similarly to Jun, but it won‘t pack the same punch. Inflation expectations haven‘t peaked, and the yield curve is about to steepen again as rates would mostly be moving higher. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 keeps rising, and is setting itself up for a brief disappointment. We aren‘t though making a top with capital t. Credit Markets Universal risk-on move in the credit market, on volume that didn‘t disappoint, which just confirms the bulls‘ overall technical advantage. Gold, Silver and Miners Gold downswing left a lot to be desired – we aren‘t likely staring at a true slide next. I actually look for silver (and the cyclically sensitive commodities such as copper, and also oil) to outperform gold in the wake of the Fed move. Crude Oil Crude oil didn‘t move much on a closing basis, but the bulls need more time to retake the reins. Copper Copper really doesn‘t want to decline, and remains slated to play catch up to the CRB Index again. The improving bullish outlook requires just time now – selling volume is drying up, tellingly... Bitcoin and Ethereum Bitcoin and Ethereum bulls haven‘t yielded, and keep the overall technical advantage. Should prices dip below $58K in BTC without solid buying materializing, now that would make me wary. But the Fed won‘t be hawkish., no. Summary Potential S&P 500 bear raid is approaching, and the more dovish the Fed would be, the shallower dip in stocks can be expected. Yes, the bulls keep having the upper hand – credit markets have behaved. As mentioned yesterday, that‘s the big picture view - the very initial reaction to taper announcement would likely be reversed higher. Cryptos, oil, copper would react best, with precious metals figuring it out only later – unless the Fed negatively surprises, in which case cryptos would be prone to wilder swings (but not downside reversal in earnest). 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.
November Monthly

November Monthly

Marc Chandler Marc Chandler 03.11.2021 15:17
Three main forces are shaping the business and investment climate:  Surging energy prices, a dramatic backing up of short-term interest rates in Anglo-American countries, and the persistence of supply chain disruptions.  The US and Europe have likely passed peak growth.  Fiscal policy will be less accommodative, and financial conditions have tightened. Japan appears to be getting a handle on Covid and after a slow start.  Its vaccination rate has surpassed the US.  The lifting of the formal state of emergency and a hefty dose of fiscal stimulus is expected to be delivered in the coming months. Many developing economies have already lifted rates, some like Brazil and Russia, aggressively so.  They will likely finish earlier too.      US light sweet crude oil rose nearly 12% last month, even though US inventories rose last month for the first time since April.   The price of WTI rose almost 10% in September.  Statistically, the rise in oil prices is strongly correlated with the increase in inflation expectations.  OPEC+ will boost supplies by another 400k barrels a day at the start of November and is committed to the same monthly increase well into 2022.   At the same time, new Covid infections in several Asia-Pacific countries, including China, Singapore, and Australia, warn of the risk of continued supply-chain disruptions.  In Europe, Germany and the UK recently reported the most cases since the spring. Belgium is tightening curbs.  Bulgaria is seeing a rise in infections, and Romania was at full capacity in its intensive care facilities.  The fact that Latvia lags the EU in vaccination at about 50% leaves it vulnerable.  The US may be lagging behind Europe, and the next four-six weeks will be critical.  Roughly 40% of Americans are not fully vaccinated.   The rise in price pressures and the gradual acknowledgment by many central bankers that inflation may be more persistent have helped spur a significant backing up of short-term rates in the Anglo-American economies. The ultimately deflationary implications of the surge in energy prices through demand destruction and the implications for less monetary and fiscal support still seem under-appreciated. Yet, the market has priced in aggressive tightening of monetary policy over the next 12 months.   The focus of the foreign exchange market seems squarely on monetary policy.  From a high level, the central banks perceived to be ahead in the monetary cycle have seen stronger currencies. The likely laggards, like the Bank of Japan, the Swiss National Bank, and the ECB, have currencies that underperformed.  Norway and New Zealand have already raised rates and are expected to do so again in November.    Of course, as you drill down, discrepancies appear.  In October, the Australian dollar was the top performer among the major currencies with a 4% gain.  It edged out the New Zealand dollar and the Norwegian krone, whose central banks are ahead of the Reserve Bank of Australia.  The RBA has pushed against market speculation that has 90 bp of tightening priced into 12-month swaps.  The Australian dollar outperformed sterling by about 2.5% in October even though the Bank of England has been so hawkish with its comments that the market had little choice but to price in a high probability of a hike as early as the November meeting.  In fact, the market has the UK's base rate above 50 bp by the end of Q1 22.  This is important because in its forward guidance that BOE has identified that as the threshold for it to begin unwinding QE by stopping reinvesting maturing issues.  Interestingly enough, when the BOE meets on March 17 next year, it will have a sizeable GBP28 bln maturity in its portfolio.   In an unusual quirk of the calendar, the Federal Reserve meets before the release of the October jobs report.  All indications point to the start of the tapering process.  It is currently buying $120 bln a month of Treasuries ($80 bln) and Agency Mortgage-Backed Securities.  The pace of the reduction of purchases is a function of the duration, and the Fed has clearly indicated the tapering will be complete around mid-year. That suggests reducing the purchases by about $15 bln a month.  Chair Powell indicated that unlike the Bank of England, the Fed will stop its bond purchases before raising rates. A faster pace of tapering would be a hawkish signal as it would allow for an earlier rate hike.  The gap between when the tapering ends and the first rate hike does not appear predetermined. Powell has talked about the economic prerequisites, which emphasize a full and inclusive labor market in the current context. The Fed funds futures entirely discount a 25 hike in July, with the risk of a move in June.  Comments by several officials hint that the Fed may drop its characterization of inflation as transitory, which would also be understood as a hawkish development.   Partly owing to the extended emergency in Japan, it is marching to the beat of a different drummer than the other high-income countries. Inflation is not a problem.  In September, the headline rate rose to 0.2% year-over-year, the highest since August 2020.  However, this is a function of fresh food and energy prices, without which the consumer inflation stuck below zero (-0.5%).  In December 2019, it stood at 0.9%.  In addition, while fiscal policy will be less accommodative in Europe and the US, a sizeable supplemental budget (~JPY30 trillion) is expected to be unveiled later this year.   After expanding by 1.3% quarter-over-quarter in Q2, the Chinese economy slowed to a crawl of 0.2% in Q3, which was half the pace expected by economists. Some of the decline in economic activity resulted from the virus and natural disasters (floods). Still, some of it stemmed from an effort to cut emissions in steel and other sectors.  The problems in China's property development space, accounting for a large part of its high-yield bond market,  unsettled global markets briefly.  Talk of a Lehman-like event seems a gross exaggeration. Still, given the sector's importance to China's economy (30% broadly measured) and the use of real estate as an investment vehicle, it may precipitate a structural shift in the economy.   The Communist Party and the state are reasserting control over the economy's private sector and the internet and social network.  It has also weighed in on family decisions, like the number of children one has, how long a minor should play video games, the length of men's hair, what kind of attributes entertainers should have, and appropriate songs to be played with karaoke.   It seems to be reminiscent of part of the Cultural Revolution and a broader economic reform agenda like Deng Xiaoping did in the late 1970s and Zhu Rongji in the 1990s.  At the same time, Beijing is wrestling with reducing emissions and soaring energy prices, which also dampen growth. Even though consumer inflation is not a problem in China (0.7% year-over-year in September), Chinese officials still seem reluctant to launch new stimulative fiscal or monetary initiatives. Moreover, new outbreaks of the virus could exacerbate the supply chain disruptions and delays fuel inflation in many countries.  The aggressiveness in which investors are pricing G10 tightening weighed on emerging market currencies in October.  The JP Morgan Emerging Market Currency Index fell by almost 0.8% last month after falling 2.9% in September, the largest decline since March 2020.  The continued politicization of Turkey's monetary policy and the aggressive easing saw the lira tumble nearly 7.5% last month, which brings the year-to-date depreciation to 22.5%.   On the other hand, Brazil's central bank has aggressively hiked rates, and the 150 bp increase in late October brought this year's tightening to 575 bp and lifting the Selic to 7.75%.  Yet, it is still below the inflation rate (10.34% October), and the government has lost the confidence of domestic and international business.  The Brazilian real fell nearly 3.5% last month to bring the year-to-date loss to almost 7.8%.   Our GDP-weighted currency basket, the Bannockburn World Currency Index, snapped a two-month decline and rose by 0.35%.  The rise in the index reflects the outperformance of the currencies against the dollar.  The currencies from the G10 countries, including the dollar, account for about two-thirds of the index, and emerging markets, including China, the other third.  The yen was the weakest of the majors, falling 2.3%.  It has a weighting of 7.5% in the BWCI.   Among the emerging market currencies in our GDP-weighted currency index, the Brazilian real's 3.4% decline was the largest, but its 2.1% weighting minimizes the drag.  It was nearly offset by the Russian rouble's 2.5% advance.  It has a 2.2% weighting in our basket.  The Chinese yuan, which has a 21.8% share, rose by 0.6%.      Dollar:   The market is pricing in very aggressive tightening by the Federal Reserve.  As recently as late September, only half of the Fed officials anticipated a hike in 2022.  The December 2022 Fed funds futures are pricing in a little more than two hikes next year. More than that, the market is discounting the first hike in June next year, implying a transition from completing the bond-buying to raising rates with no time gap.  The disappointing 2% Q3 GDP exaggerated the slowing of the world's largest economy.  We note that the supply-side challenges in vehicle production halved the growth rate.  Growth is likely to re-accelerate in Q4, but we continue to believe that the peak has passed.  While inflation is elevated, the pace of increase slowed in Q3.  Consider that the PCE deflator that the Fed targets rose at an annualized rate of 4.0% in Q3 after a 5.6% pace in Q2.  The core rate slowed to an annualized pace of 3.3% last quarter, half of the speed in the previous three months.  The infrastructure spending plans have been reduced, and some of the proposed tax hikes, including on corporations, appear to be dropped as part of the compromise among the Democratic Party.   Euro:  For most of Q3, the euro has been in a $1.17-$1.19 trading range.  It broke down in late September, and was unable to recapture it in October.  Instead, it recorded a new low for the year near $1.1525.  A convincing break of the $1.1500 area could signal a move toward $1.1300. The single currency drew little support because growth differentials swung in its favor in Q3:  the Eurozone expanded by 2.2% quarter-over-quarter while the US grew 2% at an annualized pace.  The ECB is sticking to its analysis that the rise in inflation is due to transitory factors while recognizing that energy prices may prove more sticky.  That said, news that Gazprom may boost gas sales to Europe after it finishes replenishing Russian inventories after the first week in November, natural gas prices fall at the end of October.  After the Pandemic Emergency Purchase Program ends next March, decisions about the asset purchases next year will be announced at the December ECB meeting along with updated forecasts.   (October indicative closing prices, previous in parentheses)   Spot: $1.1560 ($1.1580) Median Bloomberg One-month Forecast $1.1579 ($1.1660)  One-month forward  $1.1568 ($1.1585)    One-month implied vol  5.1%  (5.1%)         Japanese Yen:  The dollar rose 2.3% against the yen in October to bring the year-to-date gain to nearly 9.5%.  The Bank of Japan will lag behind most high-income countries in the tightening cycle, and the higher US yields are a crucial driver of the greenback's gains against the yen.  Japan's headline inflation and core measure, which only excludes fresh food, may be rising, but they are barely above zero and, in any event, are due to the surge in energy prices. In response to the weakening yen, Japanese investors appear to have boosted their investment in foreign bonds, while foreign investors increased their holdings of Japanese stocks.  The LDP and Komeito maintained a majority in the lower chamber of the Diet. A sizeable stimulus supplemental budget is expected to help strengthen the economic recovery now that the formal emergencies have been lifted.  In Q3, the dollar traded mainly between JPY109 and JPY111.  It traded higher in the second half of September rising to nearly JPY112.00.  The dollar-yen exchange rate often seems to be rangebound, and when it looks like it is trending, it is frequently moving to a new range.  We have suggested the upper end of the new range may initially be the JPY114.50-JPY115.00.  The four-year high set last month was about JPY114.70.  A move above JPY115.60 could target the JPY118.50 area.     Spot: JPY113.95 (JPY111.30)       Median Bloomberg One-month Forecast JPY112.98 (JPY111.00)      One-month forward JPY113.90 (JPY111.25)    One-month implied vol  6.4% (5.6%)   British Pound:  Sterling rallied around 4 1/3 cents from the late September low near $1.34.  The momentum stalled in front of the 200-day moving average (~$1.3850).  After several attempts, the market appeared to give up.  We anticipate a move into the $1.3575-$1.3625 initially, and possibly a return toward the September low. The implied yield of the December 2021 short-sterling interest rate futures rose from 22 bp at the end of September to 47 bp at the end of October as the market.  It was encouraged by Bank of England officials to prepare for a hike at the meeting on November 4, ostensibly while it is still providing support via Gilt purchases.  If there is a surprise here, it could be that, given the unexpected softening of September CPI and the fifth consecutive monthly decline in retail sales, rising Covid cases, that the BOE chooses to take the more orthodox route.  This would entail ending its bond purchases, as two MPC members argued (dissented) at the previous meeting and holding off lifting rates a little longer.        Spot: $1.3682 ($1.3475)    Median Bloomberg One-month Forecast $1.3691 ($1.3630)  One-month forward $1.3680 ($1.3480)   One-month implied vol 6.8% (7.1%)      Canadian Dollar:  The three drivers for the exchange rate moved in the Canadian dollar's favor in October and helped it snap a four-month slide against the US dollar.  First, the general appetite for risk was strong, as illustrated by the strength of global stocks and the record highs in the US.  Second, the premium Canada pays on two-year money more than doubled last month to almost 60 bp from 25 bp at the end of September.  Third, commodity prices in general and oil, in particular, extended their recent gains.  The CRB Index rose 3.8% last month, the 11th monthly increase in the past 12, to reach seven-year highs.  The Bank of Canada unexpectedly stopped its new bond purchases and appeared to signal it would likely raise rates earlier than it had previously indicated.  The swaps market is pricing 125 bp of rate hikes over the next 12 months, with the first move next March or April.  Still, the US dollar's downside momentum stalled near CAD1.2300.  There is scope for a corrective phase that could carry the greenback into the CAD1.2475-CAD1.2500 area.     Spot: CAD1.2388 (CAD 1.2680)  Median Bloomberg One-month Forecast CAD1.2395 (CAD1.2580) One-month forward CAD1.2389 (CAD1.2685)    One-month implied vol 6.2% (6.9%)      Australian Dollar:  The Aussie's 4% gain last month snapped a four-month, roughly 6.5% downdraft.  Despite RBA Governor Lowe's guidance that the central bank does not anticipate that the condition to hike rates will exist before 2024 is being challenged by the market.  Underlying inflation rose above 2% in Q3. The central bank's failure to continue defending the 10 bp target of the April 2024 bond spurred speculation that it would be formally abandoned at the November 2 policy meeting.  The RBA's inaction unsettled the debt market.  The two-year yield soared almost 70 bp last month, and the 10-year yield rose nearly 60 bp.  Although the RBA could have handled the situation better, New Zealand rates jumped even more.  Its two-year yield jumped 80 bp while the 10-year yield surged by 58 bp.  Last month, the Australian dollar's rally took it from around $0.7200 to slightly more than $0.7550, where it seemed to stall, just in front of the 200-day moving average.  We suspect the October rally has run its course and see the Aussie vulnerable to a corrective phase that could push it back toward $0.7370-$0.7400.  The New Zealand dollar has also stalled ($0.7220), and we see potential toward $0.7050.       Spot:  $0.7518 ($0.7230)        Median Bloomberg One-Month Forecast $0.7409 ($0.7290)      One-month forward  $0.7525 ($0.7235)     One-month implied vol 9.1  (9.0%)        Mexican Peso:  The peso eked out a minor gain against the dollar last month.  However, the nearly 0.4% gain understated the swings in the exchange rate last month.  The dollar's recovery seen in the second half of September from almost MXN19.85 to nearly MXN20.40 at the end of the month was extended to a seven-month high around MXN20.90 on October 12.  It then proceeded to fall to almost MXN20.12 before the greenback was bought again.  A move above the MXN20.60 area now would likely signal a test on last month's high and possibly higher. Recall that the dollar peaked this year's peak set in March was near MXN21.6350. The economy unexpectedly contracted in Q3  by 0.2% (quarter-over-quarter).  Nevertheless, with the year-over-year CPI at 6% in September, Banxico will see little choice but to hike rates at the November 11 meeting. The market expects a 25 bp increase.  A 50 bp hike is more likely than standing pat.       Spot: MXN20.56 (MXN20.64)   Median Bloomberg One-Month Forecast  MXN20.42 (MXN20.41)   One-month forward  MXN20.65 (MXN20.74)     One-month implied vol 9.6% (11.0%)      Chinese Yuan: Our starting point is the yuan's exchange rate is closely managed.  The fact that the yuan rose to four-month highs against the dollar and a five-year high against the currency basket (CFETS) that the PBOC tracks imply a tacit acceptance.  While it is tempting for observers to link the appreciation to securing an advantage as it secures energy supplies and other commodities, we note that the yuan's gains are too small (0.6% last month and less than 2% year-to-date) to be impactful.  We suspect that the dollar's recent weakness against the yuan will be unwound shortly.  The US government continues to press its concerns about the risk for investors in Chinese companies listed in the US and American companies operating in China. At the same time, the FTSE Russell flagship benchmark began including mainland bonds for the first time.  China's 10-year government bond is the only one among the large bond markets where the yield has declined so far this year (~16 bp).  On the other hand, Chinese stocks have underperformed.  That said, some investors see this underperformance as a new buying opportunity.  The NASDAQ Golden Dragon Index that tracks Chinese companies listed in the US fell by 30% in Q3 and gained 5% in October, its best month since February.  Lastly, the Central Committee of the Chinese Communist Party meets November 8-11 this year, a prelude to the important National Party Congress in 2022 that is expected to formally signal the third term for President Xi.     Spot: CNY6.4055 (CNY6.4450) Median Bloomberg One-month Forecast  CNY6.4430 (CNY6.4470)  One-month forward CNY6.4230 (CNY6.4725)    One-month implied vol  3.5% (3.4%)    Disclaimer
Intraday Market Analysis – USD Struggles To Bounce Back

Intraday Market Analysis – USD Struggles To Bounce Back

John Benjamin John Benjamin 04.11.2021 08:38
EURUSD claws back lossesThe US dollar fell after the Federal Reserve called for patience on raising interest rates.The pair has met strong resistance at 1.1690, a previous demand zone on the daily chart that has turned into a supply one. The latest sell-off has been contained by 1.1535, near the base of the recent rebound as an oversold RSI attracted some bargain hunters.A surge above the intermediate resistance of 1.1620 would bring in more momentum traders. Then a break above 1.1690 could kickstart a bullish reversal in favor of the euro.XAUUSD tests resistanceGold recovers as the US dollar softens across the board following a neutral FOMC.Price action had previously struggled to clear the supply area around 1810, the origin of the September correction. The subsequent fall below the support at 1785 has prompted buyers to take profit.However, the RSI’s repeated oversold situation has caught buyers’ attention at the daily support at 1760. 1785 is the hurdle ahead and a bullish breakout would resume the recovery. Failing that, the bears may push towards 1740.USOIL falls back for supportWTI crude slipped after the EIA reported a larger increase in US inventories. The psychological level of 85.00 has been an effective hurdle so far.The previous fall below 81.00 has put the bulls on the defensive, especially after their failure to achieve a new high above 84.70. This is a confirmation that sentiment has grown cautious after the price’s recent vertical ascent.The RSI’s overbought situation on the daily chart could call for a pullback. 79.50 is the closest support. Its breach may send the price to 76.50.
S&P 500’s Advance Isn’t Broad-Based, a Topping Pattern?

S&P 500’s Advance Isn’t Broad-Based, a Topping Pattern?

Paul Rejczak Paul Rejczak 01.11.2021 13:36
  The S&P 500 extended its bull market on Friday as it reached the new record high above the 4,600 level. Is this still a topping pattern? The S&P 500 index gained 0.19% on Friday, Oct. 29, as it extended its recent advance following a lower opening of the trading session. It reached yet another new record high of 4,608.08. The stock market was reacting to worse-than-expected quarterly corporate earnings releases from the AAPL and AMZN. However, the MSFT and TSLA stocks drove the index higher again on Friday. The market seems overbought in the short-term most likely it’s still trading within a topping pattern. The nearest important support level is at 4,550-4,570, and the next support level is at 4,520-4,525, marked by the previous daily gap up of 4,520.40-4,524.40. On the other hand, the resistance level is now at around 4,650. The S&P 500 trades along a short-term upward trend line, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Apple Is Volatile While Microsoft Keeps Rallying Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple released its earnings after the Thursday’s close and the first reaction was negative. But on Friday the stock retraced some of its intraday decline. Nevertheless it lost 1.8%. The resistance level remains at $154-156. It is still trading well below the record highs, as we can see on the daily chart: Now let’s take a look at MSFT. It keeps rallying and reaching new record highs after its last week’s Tuesday’s quarterly earnings release. The market remains above a month-long upward trend line. We can see that in the short-term it’s getting more and more technically overbought. The stock may enter a consolidation or a correction just like in the middle of August when it rallied above $300 level. Conclusion The S&P 500 index reached the news record high on Friday, however it closed with a gain of just 0.2%. It still looks like a topping pattern and we may see a consolidation or a downward correction at some point. There may be a profit-taking action following quarterly earnings releases. Today the main indices are expected to open 0.4% higher, but we will likely see an intraday correction later in the day. Here’s the breakdown: The S&P 500 reached new record high on Friday, as it broke slightly above the 4,600 level. A speculative short position is still justified from the risk/reward perspective. We are expecting a 3% or higher correction from the new record highs. 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.
Crude Eyeing OPEC+ Meeting – Where is Oil Headed?

Crude Eyeing OPEC+ Meeting – Where is Oil Headed?

Sebastian Bischeri Sebastian Bischeri 03.11.2021 15:32
With the OPEC+ meeting on Thursday, oil looks to be in a corrective phase, as pressure is on for more crude. Are we looking at bearish winds ahead? Crude oil prices have started their corrective wave, as we are approaching the monthly OPEC+ group meeting on Thursday, with some market participants now considering the eventuality of a larger-than-expected rise in production. U.S. API Weekly Crude Oil Stock: Inventory levels of US crude oil, gasoline and distillates stocks, American Petroleum Institute (API) via Investing.com Regarding the API figures published Tuesday, the increase in crude inventories (with 3.594 million barrels versus 1.567 million barrels expected) implies weaker demand and is normally bearish for crude prices. Meanwhile, in the United States, the average price of fuel stabilized on Tuesday after several weeks of increase, according to data from the American Automobile Association (AAA), however, that’s 60% higher than a year ago. Chart – WTI Crude Oil (CLZ21) Futures (December contract, 4H chart) In summary, we are now getting some context on how the oil market might develop in the forthcoming days, with some crucial events to monitor as they could have a strong impact on the energy markets, and particularly on the supply side. My entry levels for Natural Gas were triggered on Monday (Nov.1), and I’m updating my WTI Crude Oil projections. Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Oil Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Sebastien BischeriOil & Gas Trading Strategist * * * * * The information above represents analyses and opinions of Sebastien Bischeri, & 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, Sebastien Bischeri and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s 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. Sebastien Bischeri, 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.
Leading the Taper Run

Leading the Taper Run

Monica Kingsley Monica Kingsley 05.11.2021 15:02
No S&P 500 pause to speak of – bonds support the buying pressure. The broad turn to risk-on has value holding up relatively well while tech remains in the driver‘s seat. The daily weakness in financials looks misleading, and as a function of retreat in yields – I‘m looking for stabilization followed by higher prices. Real estate though is starting to smell a rat – I mean rates, rising rates. Slowly as the Fed didn‘t give the green light, but they would acommodate the unyielding inflation.There was something in the taper announcement for everyone – the hawks are grasping at the possibility to increase taper pace should the Fed start to deem inflation as unpleasantly hot. I wrote about the dovish side I take already on Wednesday when recapping my expectations into the meeting.Coupled with non-farm payrolls coming in above expectations, the table is set to reassure the stock bulls that further gains are possible while the lagging commodities move up. Precious metals would continue recovering from the pre-taper anxiety, and miners with copper kicking back in, would be the confirmation. The dollar should welcome the figure corresponding to yields increase, buying a little more time.One more note on oil – its downswing is positive for the stock bulls as its retreat works to increase disposable income, and in the zero rates environment, kind of acts as a shadow Fed funds rate. Regardless, I‘m standing by the call for triple digit oil prices in 2022.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 fireworks are continuing with improving participation, and the path of least resistance remains higher.Credit MarketsUniversal risk-on move in the credit market still continues, and the long HYG knot isn‘t a sign of a reversal – the bulls merely got ahead of themselves, that‘s all.Gold, Silver and MinersGold easily reversed the pre-taper weakness, and so did silver. I‘m now looking for the miners to catch up, and a good signal thereof would be a fresh commodities upswing. No, CRB Index hasn‘t peaked.Crude OilCrude oil hasn‘t peaked either, and appears attracting buying interest already. While $80 were breached, the commodity is getting ahead of itself on the downside – the oil sector doesn‘t confirm such weakness.CopperCopper has stabilized in the low 4.30s, and an upswing attempt is readying – its underperformance of CRB Index would get reversed.Bitcoin and EthereumBitcoin and Ethereum consolidation goes on, and nothing has changed since yesterday – stabilization followed by slow grind higher is what‘s most likely next.SummaryS&P 500 stands to benefit from real economy revival, earnings projections and taper being conducted in the least disruptive way, apparently. Credit markets have made up their mind, and aren‘t protesting the risk-on sentiment, which has come from a temporary commodities retreat (hello, China). Inflation worries should though still return to the fore as the rising rates aren‘t as much a result of improving economy and yield spreads, which the precious metals are sensing 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.
Gold FINALLY Breaks Free Amidst S&P INSANITY

Gold FINALLY Breaks Free Amidst S&P INSANITY

Mark Mead Baillie Mark Mead Baillie 08.11.2021 08:13
Gold, after 18 weeks of being stuck in a maniacal Short trend without price really going anywhere, FINALLY broke the bonds of the M word crowd by flipping to Long -- but not without a mid-week scare: more later on that affair. But we begin by assessing the stark INSANITY besetting the parabolic performance of the S&P 500, +25% year-to-date. It settled yesterday (Friday) at 4698 (reaching 4718 intra-day), a record closing high for the seventh consecutive session. Such phenomenon has occurred but five other times in the past 41 years! So here's a multiple choice question for you: Ready? Across all those years (i.e. from 1980-to-date), what is the longest stretch of time between all-time highs for the S&P 500? â–  a) eight monthsâ–  b) just over three yearsâ–  c) slightly less than six yearsâ–  d) all of the above (for you WestPalmBeachers down there)â–  e) none of the above If having answered "e)", you are correct: the longest stint was almost seven-and-one-quarter years from 24 March 2000 through the DotComBomb up to 13 Jul 2007. 'Twas the complete antithesis of the current paradigm of an all-time high every single trading day. But wait, there's more: those of you who were with us way back in the days at AvidTrader may recall our technically having "mild", "moderate" and "extreme" readings of both oversold and overbought conditions for the S&P. Well, get a load of this: yesterday was the S&P's 12th consecutive day with an "extremely overbought" reading. During these 41 years, that has only happened once before, 36 years ago in 1985. And the price/earnings ratio then was a respectable 10.5x: today 'tis five times that much at 54.4x (!!!) easily more than double the S&P's lifetime median P/E (since 1957) of 20.4x. And still more: Every time the S&P moves from one 100-point milestone to the next, 'tis a FinMedia "big headline deal", albeit the percentage increase comparably narrows. Nonetheless, trading gains and losses are measured by the point, not the percentage. And from 1980-to-date, the S&P has gone from 100 to now 4700, (i.e. through 46 milestones. Upon having just achieved the 4600 level on 29 October, the average number of trading days over these past 41 years to reach each 100-point milestone is 236 (just about a year's worth). But now from 4600-4700 took just five days! Cue John McEnroe: "You canNOT be SERious!!" 'Course, every trend reaches a bend, if not its end. And whilst the market is never wrong, something will the S&P upend. You regular readers already know the "earnings are not there" to support even one-half the S&P's current level. Moreover, 'tis said when the Federal Open Market Committee does nudge up its Bank's Funds rate, 'twill be "Game Over" for the S&P, (something of which the Fed is very fearful). "But mmb, even a rise from just 0.25% to only 0.50% maintains a really low rate..." Nominally still low, yes Squire: but upon it occurring, the Fed shall have doubled the cost for every bank that comes to the borrowing window, from which one can then ask banking clientele: "How's that variable rate loan workin' out for ya?" And thus falleth the first domino. And the S&P. Have a great day. Gold had a great day yesterday in settling out the week at 1820. But as noted, 'twas not before a mid-week scare. With Gold wallowing on "The Taper of Paper" Wednesday -- down at 1758 (a three-week low) -- the tried-and-true, widely followed daily moving average convergence divergence (MACD) crossed to negative. Such previous 11 negative crossings had averaged downside follow-through of 86 points. Thus within that technical vacuum, another run sub-1700 was placed on Gold's table. What instead followed was a one-day whipsaw, Gold's MACD finishing the week with a positive cross, and even better, the weekly parabolic Short trend FINALLY being bust per the first Gold-encircled dot in our weekly bars graphic: FINALLY too Gold had its first Friday in five of not being flogged ostensibly by the M word crowd. Should they thus have left the building, in concert with both the daily MACD back on the positive side and the weekly parabolic again Long, the door is open for Gold to glide up into the 1900s toward concluding 2021. As for the five primary BEGOS Markets, here are their respective percentage tracks from one month ago (21 trading days)-to-date, the S&P having swiftly replaced Oil as the leader of the pack. Of more import, note the rightmost bounce for Gold and the Bond. Why are those two stalwart safe havens suddenly getting the bid? (See our opening commentary on S&P INSANITY): Meanwhile as we waltz into the waning two weeks of Q3 Earnings Season, of the S&P's 505 constituents, 426 have reported (450 is typically the total within the seasonal calendar), of which 340 (80%) have bettered their bottom lines from Q3 of a year ago when much of the world purportedly was "shut down". Thus such significant improvement was expected: "They better have bettered!" Yet as noted, our "live" P/E is at present 54.4x. Thus to bring earnings up to snuff such as to reduce the P/E to its lifetime median of 20.4x, bottom lines need increase by 167%: but the median year-over-year increase (for those 396 constituents with positive earnings from both a year ago and now) is only 19%. Thus for those of you scoring at home, a 19% increase is nowhere near the "requisite" 167%. "Look Ma! Still no earnings!" (Crash). Still earning to grasp good grace is the track of the Economic Barometer, which bopped up a bit on the week's headline numbers. To be sure, October's Payrolls improved with a decline in the Unemployment Rate and a jump in the Institute for Supply Management's Services Index. But with a return of folks to the workplace (excluding those who've post-COVID decided they don't need to work) came a plunge in Q3's Productivity combined with a spike in Unit Labor Costs. As well, October's growth in Hourly Earnings slowed and the Average Workweek shortened, such combination suggesting temporary jobs materially lifted the overall Payrolls number. Also less highlighted was September's slowing in Factory Orders, shrinkage in Construction Spending, and the largest Trade Deficit recorded in the Baro's 24-year history. Here's the whole picture from one year ago-to-date with the S&P standing up straight: To our proprietary Gold technicals we go, the two-panel graphic featuring price's daily bars from three months ago-to-date on the left with the 10-day Market Profile on the right. And note the "Baby Blues" of linear regression trend consistency being abruptly stopped in their downward path thanks to Friday's "super-bar" -- Gold's best intra-day low-to-high run in nearly four weeks -- and the highest closing price since 04 September. As well in the Profile, price sits atop the entire stack, which you'll recall for the prior two weeks was at best a congestive mess. But to quote Inspecteur Clouseau, "Not any moooure...": As for Silver, she's not as yet generating as much comparable excitement. At left, her "Baby Blues" continue to slip even as price gained ground into week's end. At right, the price of 24 clearly is her near-term "line in the sand". Still, our concern a week ago of her falling into the low 22s has somewhat abated, albeit the daily parabolic trend remains Short; however a quick move to 24.700 ought nix that condition. "C'mon, Sister Silver!": So there it all is. We see Gold as poised to FINALLY move higher toward year-end, (barring a resurgence of the M word crowd). And we see the S&P as poised for its off-the-edge-of-the-Bell-curve INSANITY to cease, (barring an economic erosion that instead furthers the flow of free dough). After all, bad is good, just as Gold is always good. In that spirit to conclude for this week, here are three good bits from a few of the smartest (so we're told) people in the world: Betsey "With an e" Stevenson says with respect to folks not returning to the workforce post-COVID that "...It’s like the whole country is in some kind of union renegotiation..." That is True Blue Michigan-speak right there. But think about it: when you've got a) the upper labor hand, and b) the aforementioned free dough that you popped into the stock market to thus gain some 38% since the economy first shutdown, why work, eh? Besides, the feeling of marked-to-market wealth is a beautiful thing. Elon "Spacey" Musk now notes that Tesla has not contracted with Hertz to sell 100,000 four-wheel batteries. Recall when that deal first was announced, the price of TSLA went up many times more than the additional incremental return of the transaction. But hardly has it since retracted. 'Course, the company's Q3 earnings were "fantastic", in turn nicely bringing down the stock's P/E to just now 345.8x. And comparably as you already know, the only other two S&P 500 constituents classified as being in the sub-industry category of "Automobile Manufacturers" are Ford (P/E now 26.1x) and General Motors (P/E now 7.7x). But a shiny object that rolls, too, is a beautiful thing. Peter "Techie" Thiel has just opined that the soaring price of bits**t is indicative of inflation being at a "crisis moment" for the economy. 'Tis not ours to question this notion; rather 'tis beyond our pay grade to understand it. What we do understand is that THE time-tested (understatement) indicator and mitigator of inflation -- i.e. Gold -- is priced at such an attractively low level versus where it "ought" be (i.e. 3981 per our opening graphic's decree), that never again such a beautiful opportunity shall we see! Cheers! ...m... www.deMeadville.com www.TheGoldUpdate.com
Target Hit! Another Successful Call on Natural Gas

Target Hit! Another Successful Call on Natural Gas

Sebastian Bischeri Sebastian Bischeri 05.11.2021 15:10
  Have you ever tracked your progress during your oil and gas trading journey and seen such trades? Read on… and come aboard! In the previous edition published last week and updated on Monday, I projected the likelihood of a sturdy support level on the gas market – Henry Hub Natural Gas (NGZ21) Futures – for going long around the $5.268-5.361 zone (yellow band), with a relatively tight stop just below $5.070 and targets at $5.750 and $5.890. So, the market indeed sank just below that band to trigger an entry on Monday, and then it was suddenly pushed back up by the bulls waiting to take over the price to the upward direction. This long trade was also supported by the fundamentals, as the heating needs for the month of November were gradually increasing. The weather forecasts appeared to orientate the demand upwards backed by an uninterrupted demand for Liquefied Natural gas (LNG) US exports. Then, Nat-Gas hit the first target at $5.750 on Wednesday, and stopped at the $5.876 mark – located just $0.014 below the second projected target at $5.890 – on Thursday! Regarding Crude Oil, a new entry, provided to our premium subscribers on Wednesday has just being triggered. The black gold is now attempting to rebound onto that support, which acts as a new floor. Trading Charts Chart – Henry Hub Natural Gas (NGZ21) Futures (December contract, daily chart) Now, let’s zoom into the 4H chart to observe the recent price action all around the abovementioned levels of our trade plan: Chart – Henry Hub Natural Gas (NGZ21) Futures (December contract, 4H chart) In conclusion, my trading approach has led me to suggest some long trades around potential key supports - natural gas recently offered multiple opportunities to take advantage of dips onto those projected levels. If you don’t want to miss any future trading alerts, make sure to look at our Premium Section. Have a nice weekend! Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Oil Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Sebastien BischeriOil & Gas Trading Strategist * * * * * The information above represents analyses and opinions of Sebastien Bischeri, & 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, Sebastien Bischeri and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s 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. Sebastien Bischeri, 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.
Inflation Is Not The Only Consequence Of The Russian Invasion

And the Dollar Bounces Back, While BOE is in Focus

Marc Chandler Marc Chandler 04.11.2021 11:30
Overview:  The Federal Reserve announced tapering and, like the Reserve Bank of Australia earlier in the week, did not validate expectations for an aggressive rate hike.  Now the focus is on the Bank of England, where several officials seemed to goad the market into lifting short-term rates. The S&P 500 and NASDAQ rallied to new record highs yesterday and helped raise global shares today.  Among the large markets in the Asia Pacific region, only Taiwan and India did not participate in today's dance.  In Europe, the Stoxx 600 is extending its advance for the sixth consecutive session and nine of the past ten.  US futures are trading firmer.  The market is trimming yesterday's 5.5 bp rise in the US 10-year yield. It is about 3 bp lower near 1.57%.  European yields are 1-3 bp lower. The dollar, which slipped lower after the FOMC meeting, is back with a vengeance today.  It is gaining against all the majors, with the euro bearing the brunt, off about 0.5% to return toward the week's lows below $1.1550.  The yen is the most resilient and is flattish.  Emerging market currencies are also mostly lower.  The Chinese yuan is the strongest emerging market currencies today with about a 0.15% gain, recouping its losses of the past two sessions.  The Polish zloty is the weakest, off 0.6%, despite the larger than expected 75 bp hike yesterday.  Gold was tarnished by 1% yesterday, its biggest loss since mid-October, but is steadied today, up around 0.4% near $1777.  December WTI extended its pullback from $85 seen at the start of the week to dip briefly below $80.  It has firmed back above $81 in the European morning ahead of the OPEC+ meeting outcome.  Cooper prices have stabilized after tumbling 1% yesterday.   Asia Pacific  The final reading of Japan's service and composite PMI was unchanged from the preliminary estimate, with both at 50.7. The services component was the first above the 50 boom/bust level since January 2020.  The composite is at the highest since April.  The virus and formal emergency hobbled the economy, but the economy is on the mend, though out of sync with the other major economies.  Japan intends to use fiscal policy in a pro-cyclical fashion.  Prime Minister Kishida is preparing a large stimulus budget, and it is expected to be unveiled around the middle of the month.  Australia is also emerging from a soft economic period.  Real retail sales fell 4.4% in Q3, faring a little better than economists expected.  Separately, it reported its September trade surplus in line with expectations of about A$12.2 bln.  However, how it got, there was a bit different than anticipated.  First, the August trade surplus was shaved to A$14.7 bln from A$15.1 bln as imports were revised to show a 2% gain instead of a 1% loss. Second, exports fell 6% in September, twice the decline expected, but this was offset by a 2% decline in imports, rather than a 1% gain.  First thing tomorrow, the central bank issues its monetary policy statement, which is hoped to shed more light on the RBA's intent.  The US dollar is straddling the JPY114.00 area.  It reached a three-day high slightly below JPY114.30 and has held above JPY113.90.  Two large options expire today, but they have likely been neutralized.  The first is for nearly $2 bln at JPY114.00, and the other is for $1.8 bln at JPY114.30.  The Australian dollar extended yesterday's recovery to reach $0.7470 before meeting a wall of sellers, which drove it back to almost $0.7425.  Yesterday's low was set near $0.7410.  A break of $0.7400 could signal a test on the $0.7365 area.  The greenback finished yesterday at its best level against the Chinese yuan in almost three weeks, but it continues to be sold on moves above CNY6.40.  Today's yuan gain has nearly recouped the past two session's decline.  Meanwhile, the PBOC continues to set the dollar's reference rate slightly above where bank models project.  Today's fix was at CNY6.3943, while the median (Bloomberg) had it at CNY6.3926.  The PBOC has been relatively generous with its money market provisions.  New fiscal spending this month and next is expected to provide more liquidity.   Europe Before the Bank of England's last meeting (September 23), the December short-sterling interest rate futures implied a yield of 13 bp.  It is now yielding 46 bp.  The market appears to have a 15 bp hike discounted, but economists are split.  A hawkish hold could be delivered if the BOE signaled its intention to raise rates shortly while ending its bond-buying operations early.  With weak retail sales (down five months in a row through September), softer than expected September CPI, and no employment data since the furlough program, is the urgency exaggerated?   The eurozone flash services PMI was shaved lower to 54.6 from 54.7, and this led to the paring of the composite reading to 54.2 from 54.3.  It was the third consecutive decline in the composite PMI.  German and French preliminary estimates were confirmed.  Spain surprised on the upside with a service reading of 56.6.  Economists had expected a 55.8 report after 56.9 in September.  The smaller than expected decline saw a 56.2 composite, down from 57.0, but not as soft as expected.  Italy disappointed.  The services PMI fell to 52.4 from 55.5.  The median forecast was 54.5.  The composite stands at 54.2, down from 56.8.   Germany's September factory orders showed a muted response after August's revised 8.8% drop (initially reported as a 7.7% decline).  The 1.3% gain was less than expected and solely a function of foreign orders (6.3%).  Moreover, the foreign orders were from outside the euro area.  They rose by 14.9%, offsetting August's 14.7% fall.  Domestic orders fell by 5.9%.  It is the third consecutive month domestic orders declined.   The euro has been pushed below $1.1550, where a 1.1 bln euro option expires today.  It initially tried extending yesterday's post-Fed gains but stalled a little above $1.1615.  That area now looks like formidable resistance.  Support is seen in the $1.1525-$1.535 area, but note that the $1.1490 level corresponds to the (50%) retracement objective of the euro's rally from March 2020 lows.  A break of that targets the $1.13 area.  Similarly, sterling's advance yesterday was marginally extended but stopped in front of $1.3700, which is also below the 20-day moving average.  It has been sold in the European morning ahead of the BOE outcome. It has found support in front of $1.3600. Below there, the $1.3575 area marks the (61.8%) retracement target of the rally from the late September low near $1.3410.  Sterling's retreat has left the intraday momentum indicators stretched, warning of the risk of a bounce after the BOE.   America By announcing it would reduce its bond-buying starting this month by $15 bln (a month), the Federal Reserve delivered as expected. The Fed's statement was modified slightly, saying that the elevated prices are "expected" to be transitory.  There was no hawkish surprise, and Chair Powell's tried to thread the proverbial needle by acknowledging that price pressures are likely to continue well into next year.  Treasury Secretary Yellen suggested a similar scenario recently.  The dollar softened, and stocks rallied on the news.   Separately, we note that recently President Biden said he would soon make an announcement about the Fed Chair, whose term expires next February.  Yellen has defended Powell on two issues--financial market regulation and the officials trading/investing--suggests that if Biden does not re-nominate Powell, he would likely have to overrule his Treasury Secretary.   Powell cited the dramatic rise in the Employment Cost Index at yesterday's press conference.  Today, the US reports a more holistic measure of labor costs:  unit labor costs, which incorporates productivity.  The fact of the matter is that unit labor costs fell in H1. However, they are volatile quarter-to-quarter, and unit labor costs likely rise sharply in Q3.  It appears that many employers thought to get by over the summer, waiting for the end of the extra federal unemployment compensation and the re-opening of schools to free up labor without having to pay up for it.  Indeed, Q3 non-farm payroll growth averaged 488k a month, the lowest three-month average since February. This is because the employers preferred to have the existing workers do more overtime than hire.  However, the end of the benefits and re-opening of schools so far proved insufficient.  Another factor that Powell could have cited was the loss of immigrant workers. Pre-pandemic immigrants accounted for one-in-five manufacturing workers and closer to one-in-four in some industries like semiconductors, medical equipment, and food processing.  This squeeze end around November 8 as the border will be re-opened with work visas.  The US has lobbied OPEC+ to boost output faster.  Part of the problem is that some OPEC+ members, like Nigeria and Angola, have been unable to increase production, leaving OPEC+ short of the 400k barrels a day they were going to add last month.  Separately, the US reportedly will join new talks with Iran later this month.  The prospect of Iranian oil also weighed on prices.  In addition, some of the large shale producers have indicated plans to boost output. The US also reports the September trade balance.  A record shortfall is expected of a little more than $80 bln.  Weekly jobless claims pale in comparison to tomorrow's national employment report.  Canada reports September's merchandise trade balance.  Through August, Canada has reported an average monthly surplus of $700 mln.  In the first eight months of 2020, the average deficit was a little more than C$3 bln and in the same period, in 2019 recorded an average deficit of C$1.5 bln. The US dollar spiked to almost CAD1.2460 yesterday but reversed lower and settled on its lows near CAD1.2390.  It is consolidating and straddling CAD1.2400 today.  There is an option for nearly $800 at CAD1.2420 that expires today and one for $515 mln at CAD1.2375 that expires tomorrow.  The intraday momentum indicator suggests limited upside in early North America.  The greenback posted a potential key reversal against the Mexican peso yesterday by first making a new high for the move (~MXN20.98) and then selling off to close below the previous session's low.  Yesterday's low (~MXN20.5150) has held so far today as the dollar consolidates mostly below MXN20.60.  An option for $430 mln at MXN20.55 expires today.  A break of MXN20.50 sees nearby support around MXN20.47 (the 20-day moving average ) and MXN20.44 (the 6.18% retracement objective of the dollar's rally from late last month).  Disclaimer
Meaning Of The Bull Market - The Opposition To The Bear One

Where‘s the Beef?

Monica Kingsley Monica Kingsley 04.11.2021 15:18
S&P 500 embraced the dovish taper - $10bn a month pace gives the Fed quite a breathing room without having to revisit the decision unless markets force it to. The taper is as dovish as can be, with rate raising escaping attention. Talk of no rocking the boat, for the markets, economy and fiscal policy initiatives just can‘t do without. The more dovish scenario of my yesterday‘s presentation came true: (…) So, how would the taper message be delivered, and could it go as far as $15bn a month asset purchase reduction while avoiding rate hike mentions as much as possible? Even if $15bn is indeed the announced figure, I‘m looking for the Fed to soften it before it can run its course, i.e. before 2H 2022 arrives – the economy isn‘t in such a great shape to take it, and the fresh spending bill (whatever the price tag), needs central bank‘s support too. The initial reaction has been very positive in stocks, and overly weak in precious metals and commodities. The real assets downswings are though being reversed in line with my Tuesday‘s expectations – and in today‘s premarket tweets on the unfolding price moves. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 rose without any brief disappointment – the top with capital t clearly isn‘t in, so don‘t think about standing in the bulls‘ way much. Credit Markets Universal risk-on move in the credit market continues, and the sectoral reaction to rising Treassury yields is a very positive one. Bonds and stocks are obviously seeing through the taper fog. Gold, Silver and Miners Gold was afraid of the hawkish outcome, which had zero real chance of happening – and miners spurted higher decisively first. Let‘s see the initial and misleading weakness in real assets being reversed, one by one – and silver do great again. Crude Oil Crude oil has likewise flashed extraordinary weakness – one to be reversed with vengeance. The Fed can‘t print oil, and the energy crunch goes on as nothing has changed yesterday for black gold. Copper Copper gyrations don‘t change the fact the red metal is ready to swing higher next. Just wait for its reaction when broader strength returns to the CRB Index – we won‘t have to wait too long. Bitcoin and Ethereum Bitcoin and Ethereum haven‘t been jubilant about the dovish news, but haven‘t come down beforehand either. Stabilization followed by slow grind higher is what‘s most likely next. Summary S&P 500 benefited the most from the taper message delivery, and the bulls keep having the upper hand – with increasing confirmation from the credit markets. The very initial reaction to taper announcement – namely its bearish anticipation – is indeed being reversed higher within commodities and precious metals. No tantrum, no rocking the boat – and asset prices are going to love that. Get ready for rising yields that would gradually stop underpinning the dollar – patience with the latter. 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.
The 10 Public Companies With the Biggest Bitcoin Portfolios

Ethereum reaches new all time high

Walid Koudmani Walid Koudmani 02.11.2021 12:21
Ethereum reaches new all time high Moods in cryptocurrency markets have improved after positive news emerged from Asia and following the solid performance of Bitcoin, which closed October with the highest monthly gain in 2021, further boosting investor confidence. The second biggest cryptocurrency by market cap has now also managed to reach a new all time high with Ethereum breaking above the previous high and reaching a new one after gaining over 3% as the majority of coins appear to be rising. While it is unclear whether this move will continue, today's achievement could further boost confidence in the current market as it comes after an updated prediction of Ethereum by Goldman Sachs which projected the coin reaching $8000 before the end of the year. Furthermore, prospects for a potential Ethereum ETF after the approval and launch of Bitcoin ETFs appears to be a possibility in the near future, which in turn continues to point towards increased adoption of the new blockchain technologies along with a wider appeal of this type of asset as more investors shift towards the space.   BP announce positive quarter and boost share buyback BP announced another quarter of positive results, indicating rising commodity prices and improving conditions as main drivers for the company's continued growth. The company also announced an expansion of its ongoing share buyback program by adding a further $1.25billion which will be adding to the $1.4billion already executed in the first half of the year. While net debt remains a key area of concern, totalling around $32billion, investors may look favourably on today's report as it highlights the companies resilience and adaptability along with it's prioritization of cash flow to strengthen its financial position as future prospects of rising oil prices driven by increased demand and limited supply could also potentially improve the outlook, particularly for the next quarter. Download our Mobile Trading App:   Google Play   App Store
Silver, patience pays

Silver, patience pays

Korbinian Koller Korbinian Koller 08.11.2021 08:13
Here is what you should consider when asking why it isn’t trading even higher. First, after an initial up-leg like this, a trend is set in motion, but it is just the beginning of a trend. It needs time to develop. Most of the reasons debated this year when silver stepped into the limelight were the reasons the traders anticipated fueling the first leg. A big part is that it takes time until the public digests the market, which is ahead of reality, a speculative prognosis on how the future might look. There is a trickle-down effect until silver can build up its second leg. From an active market speculator perspective, inflation is real, but years can pass until the crowd realizes what is going on. Then gold needs to move, which in turn awakens silver with a delay. Gold in US-Dollar, monthly chart, bull as bull can be: Gold in US-Dollar, monthly chart as of November 5th, 2021. The monthly gold chart above shows the strong bullish trend in gold over the last twenty years. Telltales are a higher high in 2020 versus 2011, and the price strength since. Gold in US-Dollar, weekly chart, getting ready: Gold in US-Dollar, weekly chart as of November 5th, 2021. The weekly chart has just come alive to an exciting inflection point. A closer look reveals that price has successfully built a second leg from the US$1,680 double bottom price zone (yellow lines). The upcoming weeks should show if a double triangle formation (red lines) was severed now that the price is trading above POC support of a fractal volume study (white line). Silver in US-Dollar, weekly chart, looking good: Silver in US-Dollar, weekly chart as of November 5th, 2021. The weekly silver chart is bullish as well. Bulls have successfully defended the yearly range lows zone (slim white box). They mutually are attacking an overhead resistance with quite some might, and upcoming weeks might find price successful in that attempt. Silver in US-Dollar, monthly chart, history as a guide: Silver in US-Dollar, monthly chart as of November 5th, 2021. The above monthly chart shows an excellent example of how much patience is needed to earn significant profits from a silver investment. In this case, silver initiated a range break in 1973, where prices tripled within a year. Much like silver’s recent move from March last year to the current top in February this year. It showed a similar percentage move. This first leg of a bullish trend required more than three years of investor’s patience before the second leg was initiated. Those patient enough to hold on were rewarded with a near thousand percent price increase.   Silver, patience pays: “It never was my thinking that made the big money for me. It always was my sitting.”Nothing has changed in the last hundred years about the principle value of this quote by Edwin Lefèvre (Reminiscences of a Stock Operator, published in 1923). We are used to active participation in a process to earn one’s wages. In this aspect however, the market is counterintuitive. “The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street even among the professionals, who feel that they must take home some money every day, as though they were working for regular wages.” Lefèvre again points towards patience and a state of inactivity being just right in market play. We find the last phase of silver in a sideways range if anything is encouraging to a substantial second leg up in the making, It will therefore reward the patient owner of his physical holdings. 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. This article does 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.
US tech stocks under pressure ahead of FED speeches

US tech stocks under pressure ahead of FED speeches

Walid Koudmani Walid Koudmani 08.11.2021 12:53
US tech stocks under pressure ahead of FED speeches While US stock markets continued to reach new all time highs and after the FED announced it would be starting its QE tapering in last week's meeting, we are seeing some increased selling pressure at the start of the week with US futures slightly down. This comes after Elon Musk announced over the weekend that he would be selling 10% of his Tesla shares (worth around $21 billion) depending on the results of a poll he held on Twitter, this in turn worried some investors who noted that selling such a significant stake could create significant downward pressure on the share price. On the other hand, it is worth noting that due to the elevated trading volume that Tesla shares experience, any potential impact could be significantly mitigated if the CEO were to spread that sale across several weeks. Finally, today's FED speeches could shed some light on the central bank's outlook heading into the final part of the year and could further elaborate on last week's decision to begin tapering and how that may impact stocks in the near future as the central bank attempts to not worry investors.  Bitcoin approaches all time high as cryptos climb higher After some time spent consolidating in the $60,000 range, Bitcoin has managed to break through the upper limit of the trading range and resume the upward move with the main crypto currency approaching it's recently reached all time high as it trades around $66,000. This positive sentiment is echoed across the majority of other coins with the total market cap once again nearing the $3 trillion mark and with Ethereum once again reaching a new high. While we have seen Bitcoin impact other crypto currencies in the past, a break past the previous all time high could lead to a significant increase in volatility and a potential domino effect as more investors enter the market or reallocate their funds. Download our Mobile Trading App:   Google Play   App Store  
Intraday Market Analysis – AUD Seeks Support

Intraday Market Analysis – AUD Seeks Support

John Benjamin John Benjamin 03.11.2021 08:48
AUDUSD breaks lower The Australian dollar softened after a dovish RBA stressed that inflation was still too low to hike soon. The pair has met stiff selling pressure near last July’s high of 0.7550. While sentiment has turned positive from the daily chart’s perspective, an overbought RSI has made buyers cautious. The drop below 0.7490 then 0.7450 has forced out leveraged positions, exacerbating the downward pressure. 0.7380 on the 30-day moving average would be the next support. An oversold RSI may attract bids in this congestion area. NZDUSD retreats from double top The New Zealand dollar bounced back after the Q3 unemployment rate fell to 3.4%. A double top at 0.7220 suggests exhaustion in the kiwi’s ascent after the RSI repeatedly pointed to an overbought situation. A break below 0.7130 indicates that the bears have gained the upper hand, pushing the opposing side to close their bets. The previous supply zone around 0.7070 has turned into a demand zone. This coincides with the 30-day moving average, and along with an oversold RSI, it may gain support from a buy-the-dips crowd. UK 100 tests demand zone The FTSE 100 consolidates gains as investors turn their attention to the US Federal Reserve meeting. The bulls are looking to get a foothold after a close above the August peak at 7240. The RSI’s double top in the overbought zone is a sign of overextension in the short term. Trend followers may look to stake in at the psychological level of 7200, a key demand zone on the 20-day moving average. A bearish breakout would deepen the pullback to 7140. On the upside, a rebound above 7310 would resume the rally.
Intraday Market Analysis – GBP Struggles For Support - 05.11.2021

Intraday Market Analysis – GBP Struggles For Support - 05.11.2021

John Benjamin John Benjamin 05.11.2021 08:51
GBPUSD tests key floor The pound plummeted after the Bank of England held interest rates against expectations. The plunge below the daily support at 1.3570 has caught buyers off guard. Those who bet on a rebound around 1.3600 have rushed to the exit, raising volatility in the process. The September low at 1.3430 would be the next target. An oversold RSI may attract some buying interest, though buyers might be cautious to avoid catching a falling knife. The supply zone between 1.3640 and 1.3700 could keep the sterling under pressure. USDJPY consolidates gains The US dollar consolidates recent gains as traders digest the start of the Fed’s taper. The pair is seeking support around the 20-day moving average after a parabolic rise sent it to a four-year high. An overbought RSI from the daily chart is a sign of exhaustion and traders may be reluctant to push higher. The greenback has found bids along the demand zone over 113.30. The bulls need to clear the fresh hurdle at 114.45 before they could resume the uptrend. A bearish breakout would trigger a sell-off towards 112.50. US 500 grinds to new highs The S&P 500 continues to climb as the Fed deliberately leaves rate hikes off the table. The rally has gained momentum after the index cleared the previous peak at 4550. Sentiment remains bullish, but an overbought RSI in the daily timeframe may call for a pause. Overextension is also on the hourly chart as the RSI repeatedly ventures above 70. The bulls are pushing towards the psychological level of 4700. 4620 on the 30-hour moving averages may attract trend followers’ bids in case of a pullback.
USDJPY best at support at 113.40/30 again today

USDJPY best at support at 113.40/30 again today

Jason Sen Jason Sen 02.11.2021 10:50
USDJPY best at support at 113.40/30 again today. EURJPY up one day, down the next day in the sideways trend for over a week. Becoming more erratic & therefore difficult to trade. CADJPY also more random & more erratic last week, although shorts at first resistance at 9240/60 work again yesterday with a 70 pip profit offered this morning. Update daily at 06:30 GMT Today's Analysis. USDJPY first support again at 113.40/30. Longs need stops below 113.20 so the risk is very small. A break lower is a sell signal targeting 113.00/112.90 & 112.60/50 for profit taking on shorts. Longs at 113.40/30 target 113.80/90. We should pause here but further gains meet minor resistance at last week's high of 114.25/30. Strong resistance at the October high of 114.50/70. Shorts need stops above 114.80. A break higher is a medium term buy signal. EURJPY first support at 131.60/40, stop below 131.35. A break lower is a sell signal initially targeting 130.90 & we could hold here initially, maybe even bounce to 131.40/50. Further losses meet an important buying opportunity at 130.40/20 with stops below 130.00 First resistance at 132.20/30 . Above 132.40 can target 132.90, perhaps as far as strong resistance at October's high of 133.30/50. CADJPY shorts at first resistance at 9240/60 worth a try again targeting 9200 & 9175 (hit as I write). A buying opportunity at 9120/00 with stops below 9090. Gains are likely to be limited with first resistance at 9240/60. However a break higher retests October's high at 9295/9305. Emini S&P December on the way to the next target of 4625/35 this week. Longs at first support at 4590/85 starting to work. Nasdaq December closed at the new all time high at 159864 keeping the outlook positive for this week as we hit the next target of 15900/950. Emini Dow Jones December making a clear break above the all time high at 35540/550 for a buy signal as we hit the next target of 35800/850 & now look for 36000/100. Update daily at 07:00 GMT. Today's Analysis. Emini S&P longs at first support at 4590/85 are expected to target 4625/35 but a high for the day is likely if tested today. Shorts are very risky of course in the bull trend. A break above 4645 is the next buy signal. First support at 4590/85. Longs need stops below 4575. Strong support at 4545/35. Longs need stops below 4525. Nasdaq December now expected to target 15900/950 (hit yesterday) & now 16050/080. Downside is expected to be limited ion the bull trend with first support at 15780/750. Stop below 15720. A break lower targets 15670 with strong support at 15580/540. Longs need stops below 15500. Emini Dow Jones December now targeting 35800/850 & 36000/100, even as far as 36250/280. Downside is expected to be limited with minor support at 35670/650 & 35525/500. A buying opportunity at 35320/280 with stops below 35250. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
The more environmentally friendly, the more comfortable to work in

The more environmentally friendly, the more comfortable to work in

Finance Press Release Finance Press Release 08.11.2021 13:03
Office buildings that have solutions to limit the negative impact on the environment and reduce operating costs, at the same time provide a friendlier, safer and better organized work space. What do they offer? The change in the way of thinking about the work environment that has taken place since last spring did not ultimately affect the status of offices. On the contrary, after several months of hibernation, offices experience a renaissance. They are still a strong support in building the organizational culture of companies and a base for the development and cooperation of teams, training new employees, and a meeting place with clients. However, the expectations of the users of office buildings have changed. In addition, issues concerning the way buildings affect the natural environment and the people working in them have come to the fore. - Decision-making processes aimed at environmental protection are gaining momentum, which more and more often carry specific declarations of investors and developers, in which they undertake to reduce carbon dioxide emissions by buildings to zero in a specific time perspective - says Bartłomiej Zagrodnik, Managing Partner/CEO of Walter Herz. It became necessary to reevaluate the previously adopted standards and expand the scale of pro-ecological solutions, especially in the context of the climate change, which brings unexpected and dangerous weather phenomena. - The development of the market is focused on the implementation of intelligent, environmentally neutral buildings and the creation of innovative solutions that support the decarbonisation of the existing resources and adapting them to the current requirements in the field of sustainable development - explains Bartłomiej Zagrodnik. - The changes are also stimulated by such factors as rising electricity prices, costs of water consumption, heating and waste disposal. Office buildings are switching to green energy derived only from renewable sources, which not only has positive environmental effects, but also reduces operating costs. Hence, we also see the growing interest of tenants in real estate equipped with environmentally friendly solutions - says Bartłomiej Zagrodnik. Green energy and water saving The most modern buildings not only draw energy from renewable sources, but also use technologies that reduce its consumption by automating space management. There are also more and more common solutions enabling water retention, which is of key importance in the face of the water crisis. Facility owners are serious about the problem of shrinking water resources. They invest in gray water filtering and reuse systems and rainwater management, fittings and showers based on motion sensors to reduce network water consumption, as well as various types of water retention solutions. They create green roofs, terraces and rain gardens. Companies are also more likely to choose buildings that meet certain standards in this area, in order to take advantage of the possibility of reducing costs. In Poland, proper management of water resources is particularly important because in terms of our resources, we are on one of the last places in Europe, ahead of the Czech Republic, Cyprus and Malta. Unfortunately, the level of water consumption in the world is constantly increasing. Over the last century, it has increased sixfold. Crystal clear air, green enclaves and ecological crops There are many more factors that influence the efficiency of the office buildings. There are, among others, ventilation and air circulation systems that control and supply air of better quality than specified in the standards in high-class facilities, specialized filters and humidifiers, as well as carbon free finishing materials and solutions optimizing acoustics. Modern buildings expand the spectrum of solutions to become more work-friendly and environmentally friendly. Here, green also plays one of the main roles. We observe the creation of green enclaves around the buildings, the arrangement of courtyards, squares and recreation areas immersed in greenery, also with green concrete pavements that purify the air. Vegetation is usually selected in terms of low water demand and the possibility of producing a large amount of oxygen and absorbing toxins, and vines in the context of protecting the walls of the building from heating up. The complexes include refuges for birds and insects, as well as city apiaries and gardens for organic farming. Specially designed blocks, facades and roofs of buildings with elements reflecting sunlight are used to reduce the effect of the so-called urban heat islands. The interiors of office buildings are arranged in such a way as to activate users. For example, the central location of the stairs is to encourage the movement of pedestrians between the floors, which reduces the use of elevators. The promotion of infrastructure for cyclists in the office buildings is also conducive to the pro-health activity of employees and reducing the burden on the environment. Technologies that facilitate work organization The well-being of employees, so widely discussed today, is supported by the use of hybrid office management platforms in the most modern buildings, thanks to which the facilities can offer the so-called smart office. Applications available on smartphones improve the daily work organization. With their use, one can, among others, book an office arrival time or a parking space, enter the garage and take a lift to the selected floor avoiding contact with the other office users, book a conference room for a team or client meeting, and even report a printer issue. The key challenge was to provide people in the office environment with the greatest possible comfort and safety. It is to be guaranteed not only by generally available basic disinfectants, masks and gloves, but also by changes in the arrangement of offices. Such arrangement of office spaces, so that they are comfortable for everyone and provide various types of zones adapted to the new work profile. Therefore, companies most often decide to increase the distance between work stations, limit the number of large conference rooms that replace dedicated smaller rooms, boxes and booths for talks, as well as stands for creative team work. There are social zones, chill out rooms to rest, green terraces and winter gardens. The ambition of the office environment is also to create ecological spaces. Using as many recycled or reusable office supplies as possible, such as filter bottles instead of disposable plastic packaging. Undoubtedly, the reduction of the carbon footprint is also facilitated by the popularization of videoconferences, which significantly reduced business trips. Just as the already sanctioned electronic document flow previously contributed to minimizing the use of paper. Good service in the buildings is also increasingly important. The offer of additional services, similar to those provided by hotels, for example concierge service, is gaining in importance. The key condition is also direct access to the gastronomic offer, basic services and shops, preferably on the premises of the building. The changes taking place in the office market are generally aimed at perceiving space as a service. 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.
Here We Go Again - Gold Simply Can’t Stand $1,800!

Here We Go Again - Gold Simply Can’t Stand $1,800!

Arkadiusz Sieron Arkadiusz Sieron 02.11.2021 15:05
  The yellow metal couldn’t face the downward pressure and declined abruptly on Friday. What happened, and why did it fail? Friday was a brutal time for gold. The price of the yellow metal dropped sharply from around $1,795 to $1,775 in the early morning hours in the US. Am I surprised? Not at all. In Thursday’s edition of the Fundamental Gold Report, I wrote that “gold may struggle until the Fed’s tightening cycle starts. You have been warned!”, and, as if on cue, gold wasn’t able to maintain its position around $1,800 and declined. Actually, gold prices have been testing and failing to hold this key psychological level for the last three weeks. What exactly happened on Friday? Well, the Bureau of Economic Analysis published the report on personal income and outlays in September 2021. The publication shows that U.S. nominal consumer spending increased 0.6%, while the disposable personal income declined 1.3%, reflecting a decrease in government social benefits. Additionally, the annual rate of change in personal consumption expenditures price index accelerated from 4.2% in August to 4.4% in September (see the chart below), the highest pace since January 1991. Wait. Inflation rose, but gold prices declined? Exactly. Inflation is fundamentally positive for gold in the long run, but so far – as I explained last week – “inflationary worries have been counterweighted by the expectations of the Fed’s tightening cycle”. The relationship is simple: higher inflation translates into higher expectations of a more hawkish Fed. The odds of an interest rate hike in June 2022 increased from 23.1% - recorded at the end of September - to 61.6% on October 22 and 65.7% on October 29, 2021. As a result, the bond yields increased, while the greenback strengthened. There is also another possible driver of rising interest rates and an appreciating US dollar. CPI inflation in the euro area accelerated to 4.1% in October from 3.4% in September, reaching the highest value since July 2008. However, the ECB kept its monetary policy unchanged last week despite quickly rising prices. Moreover, it’s not signaling any tightening of its stance, maintaining that high inflation is transitory even though Christine Lagarde acknowledged that the decline in inflation would take longer than the central bank had initially expected. The point here is that the ECB remains an outlier among central banks, which either have already tightened or signaled tightening of their monetary policy. This means that the US dollar is likely to appreciate against the euro, which should be another headwind for gold. Having said that, this scenario will occur if the markets believe in a dovish stance of the EBC. The rising yields on German bonds indicate that the markets don’t entirely trust Lagarde’s rhetoric and expect a more hawkish stance of the ECB, which would be fortunate for gold.   Implications for Gold What does higher US inflation imply for the gold market? Well, not so much in the short run. Even though I’ve seen some signs of a bullish revival in the gold market, the bulls remain too weak to challenge the $1,800 level. That’s too much, man! Luckily, better times are coming for gold. Have you seen the advance estimates of the durable goods orders (0.4% decline in September) or of the GDP in the third quarter of this year? According to the BEA, real GDP increased at an annual rate of 2.0% (annualized quarterly growth), much below the 6.7% reported in Q2 and much below the expectations of 2.8% growth. When it comes to the annual percentage growth year-over-year, real GDP rose 4.9% compared to 12.2% in Q2, as the chart below shows. So, the pace of growth remains historically fast, but it’s decelerating quickly. Given that the economy has already reopened and energy and transportation crises are hurting growth (not to mention inflation wreaking havoc), we should expect a further slowdown on the way. And this brings us closer to… yes, you guessed it, stagflation. To be clear: we are still far from stagnation, but the economic slowdown after a spectacular post-pandemic recovery is already unfolding. When we add it to high inflation, we should get an environment supportive of gold prices. However, supportive factors won’t be able to fully operate until the Fed starts hiking interest rates and gold prices bottom out. Sometimes one needs to hit rock bottom to succeed later; perhaps that’s also the case with gold. Time will tell. 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
A New Profitable Call on Crude Oil: “The Yoyo-Trade”

A New Profitable Call on Crude Oil: “The Yoyo-Trade”

Sebastian Bischeri Sebastian Bischeri 08.11.2021 16:54
Was the adage "buy the rumor, sell the news" also verified with that new trading position? It was Thursday (Nov. 4) that the following rumor had flourished: a possible coordinated action which was supposed to consist of drawing on the strategic reserves of several countries, including the United States, which were leading the dance. Meanwhile, our subscribers were just getting ready to go long around the $76.57-79.65 support zone (yellow band), with a stop placed on lower $76.48 level (red dotted line) and targets at $81.80 and $83.40 (green dotted lines). As a result, oil prices had contracted in stride (trading just into our entry area), just before the rumor effect faded shortly on Friday (Nov. 5), to push them back up. In fact, with oil prices picking up momentum on Friday, once again settling firmly above $80 per barrel, and with a market still showing doubts on the possible use of strategic crude reserves, the proposed trade entry on the black gold, triggered on Thursday – following my last post – was thus profitable since it already turned into a partial profit-taking at the end of the week. Then, on Saturday, Joe Biden said that his administration had the means to cope with the rise in energy prices, in particular after the OPEC+'s decision not to raise their production to more than 400,000 barrels per day. in a context of global imbalance between supply and demand. In addition, Joe Biden also insinuated that the organization (and its allies) might actually not do its best to pump enough volume of crude oil. Trading Charts Chart – WTI Crude Oil (CLZ21) Futures (December contract, daily chart) Now, let’s zoom into the 4H chart to observe the recent price action all around the above-mentioned levels of our trade plan: Chart – WTI Crude Oil (CLZ21) Futures (December contract, 4H chart) In summary, my trading approach has led me to suggest some long trades around potential key supports, as this dip on crude oil offered a great opportunity for the bulls to enter long whilst aiming towards specific projected targets. If you don’t want to miss any future trading alerts, make sure to look at here. . Moreover, for those interested in Forex trading, please note that I am currently preparing some new series about the co-existing links and relationships between commodities and currencies. Stay tuned – happy trading! Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Oil Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Sebastien BischeriOil & Gas Trading Strategist * * * * * The information above represents analyses and opinions of Sebastien Bischeri, & 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, Sebastien Bischeri and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s 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. Sebastien Bischeri, 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.
Getting Back To Risky Assets As A Result Of Russian Move?

Calling the Precious Metals Bull

Monica Kingsley Monica Kingsley 08.11.2021 16:54
S&P 500 paused to a degree, but bonds didn‘t – we‘re far from a peak. That though doesn‘t mean a brief correction (having a proper look at the chart, sideways consolidation not reaching more than a precious couple of percentage points down) won‘t arrive still this month. It‘s a question of time, and I think it would be driven by tech weakness as the sector has reached lofty levels. It‘ll go higher still, but this is the time for value and smallcaps. And when the dollar starts rolling over to the downside (I‘m looking at the early Dec debt ceiling drama to trigger it off), emerging markets would love that. And commodities with precious metals too, of course – sensing the upcoming greenback weakness has been part and parcel of the gold and silver resilience of late. Precious metals are only getting started, but the greatest fireworks would come early spring 2022 when the Fed‘s failure to act on inflation becomes broadly acknowledged. For now, they‘re still getting away with the transitory talking points, and chalking it down to supply chain issues. As if these could solve the balance sheet expansion or fresh (most probably again short-dated) Treasuries issuance (come Dec) – the Fed is also way behind other central banks in raising rates. Canada, Mexico and many others have already moved while UK and Australia are signalling readiness – the U.S. central bank is joined by ECB in hesitating. Don‘t look for the oil breather to last too long – black gold is well bid above $78, and hasn‘t made its peak in 2021, let alone 2022. As I wrote on Friday, its downswing that works to increase disposable income (serving as a shadow Fed funds rate in the zero rates environment), would prove short-lived. The real economy would have to come to terms with stubbornly high oil prices – and it will manage. The yield curve is starting to steepen modestly again, and fresh spending initiatives would breathe some life into the stalling GDP growth. Next year though, don‘t be surprised by a particularly weak (even negative) quarterly reading, but we aren‘t there by a long shot, I‘m telling you. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 looks getting ripe for taking a pause – the rising volume isn‘t able to push it much higher intraday. Credit Markets HYG strength indeed continues, and it‘s a good sign that quality debt instruments are joining – the reprieve won‘t last long though (think a few brief weeks before rates start rising again). Gold, Silver and Miners Gold and silver continue reversing the pre-taper weakness, and miners are indeed joining in. I‘m looking for more gains with every dip being bought. Crude Oil Crude oil hasn‘t peaked, and looks getting ready to consolidate with a bullish bias again. $85 hasn‘t been the top, and the energy sector remains primed to do well. Copper Copper is deceptively weak, and actually internally strong when other base metals are examined. As more money flows into commodities, look for the red metal to start doing better – commodities haven‘t topped yet. Bitcoin and Ethereum Bitcoin and Ethereum consolidation has come to an end, and the pre-positioned bulls have a reason to celebrate as my prior scenario– stabilization followed by slow grind higher is what‘s most likely next – came to fruition. Summary S&P 500 breather is a question of time, but shouldn‘t reach far on the downside – the credit markets don‘t support it. Commodities are catching up in the (dovish as assessed by the markets too) taper aftermath, and precious metals are sniffing the dollar‘s weakness a few short weeks ahead. With fresh money not needed to repair commercial banks‘ balance sheets, it flows into the financial markets, and the taper effects would be negated by the repo operations – yes, I‘m not looking for a liquidity crunch. 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.
USD Index: Are New Milestones in the Cards?

USD Index: Are New Milestones in the Cards?

Przemysław Radomski Przemysław Radomski 08.11.2021 16:54
While the greenback's failed breakout on Nov. 4th may seem bearish, it faced a similar situation in August and October, only to recover and achieve new highs. After the USD Index’s negative response to the ECB’s monetary policy meeting on Oct. 28, I warned on Oct. 29 that dollar bears were unlikely to celebrate for much longer. I wrote: Based on the rather random comment during the conference, the traders panicked and bought the EUR/USD, which triggered declines in the USD Index (after all, the EUR/USD is the largest component of the USDX). Was the breakout to new 2021 lows invalidated? No. The true breakout was above the late-March highs (the August highs also served as a support level, but the March high is more important here) and it wasn’t invalidated. What was the follow-up action? At the moment of writing these words, the USDX is up and trading at about 93.52, which is just 0.07 below the August high in terms of the closing prices. Consequently, it could easily be the case that the USD Index ends today’s session (and the week) back above this level. You’ve probably heard the saying that time is more important than price. It’s the end of the month, so let’s check what happened in the case of previous turns of the month; that’s where we usually see major price turnarounds. I marked the short-term turnarounds close to the turns of the month with horizontal dashed blue lines, and it appears that, in the recent past, there was practically always some sort of a turnaround close to the end of the month. Consequently, seeing a turnaround (and a bottom) in the USD index now would be perfectly normal. And after the forecast turned into reality, the USD Index surged above 94 and remains poised to resume its uptrend over the medium term. To explain, if we zoom in on the four-hour chart, it highlights the importance of the price action on Nov. 5. During the session, the USD Index hit a new 2021 intraday high before a small reversal occurred. This might seem bearish at the first sight (it’s a failed breakout, after all)… However, similar developments were also present in August and October. After the dollar basket attempted to make new highs and failed, the greenback eventually regained its composure and achieved the milestones. As a result, another 2021 high should occur sooner rather than later. Please see below: The first failed attempt to break above the previous highs triggered sizable short-term declines. This happened in August (marked with red). The second – September – attempt triggered only a small correction (marked with green) that was then followed by a bigger rally. Similarly, the – marked with red – October invalidation was followed by a sizable decline, and the current one (marked with green), is relatively small. And it’s likely to be followed by a short-term rally, just like the September correction was. On top of that, as you can see on the below chart, the current setup for the USD Index and gold mirrors what we witnessed in early August. Following its sharp summertime rally, the USD Index moved close to its 50-day moving average without reaching it. And after buyers stepped in, the USD Index resumed its uptrend and made a new 2021 high. Moreover, with a similar pattern and a similar reading on the USD Index’s RSI (Relative Strength Index) present today, the greenback’s outlook remains robust. I marked both cases with red, vertical, dashed lines below. More importantly, though gold, silver, and mining stocks’ upswings concluded once the USD Index bottomed close to its 50-day moving average in August and sharp drawdowns followed. Moreover, while gold, silver, and mining stocks’ recent rallies were likely underwritten by expectations of a weaker USD Index (it did fail to move to new highs, right?) , technical (as described above and below) and fundamental realities contrast this thesis. As a result, the 2021 theme of ‘USD Index up, PMs down’ will likely resume over the medium term. Please see below: Equally bullish for the greenback, the Euro Index remains overvalued and should suffer a material drawdown over the medium term. For example, the index’s previous lows, its 50-day moving average, and its declining resistance line combined to create major resistance and the Euro Index is now retesting its 2021 lows. As a result, the next temporary stop could be ~1.1500 (the March 2020 highs, then likely lower). For context, the EUR/USD accounts for nearly 58% of the movement of the USD Index, and that’s why the euro’s behavior is so important. Please see below: Adding to our confidence (don’t get me wrong, there are no certainties in any market; it’s just that the bullish narrative for the USDX is even more bullish in my view), the USD Index often sizzles in the summer sun and major USDX rallies often start during the middle of the year. Summertime spikes have been mainstays on the USD Index’s historical record and in 2004, 2005, 2008, 2011, 2014 and 2018 a retest of the lows (or close to them) occurred before the USD Index began its upward flights (which is exactly what’s happened this time around). Furthermore, profound rallies (marked by the red vertical dashed lines below) followed in 2008, 2011 and 2014. With the current situation mirroring the latter, a small consolidation on the long-term chart is exactly what occurred before the USD Index surged in 2014. Likewise, the USD Index recently bottomed near its 50-week moving average; an identical development occurred in 2014. More importantly, though, with bottoms in the precious metals market often occurring when gold trades in unison with the USD Index (after ceasing to respond to the USD’s rallies with declines), we’re still far away from that milestone in terms of both price and duration. Moreover, as the journey unfolds, the bullish signals from 2014 have resurfaced once again. For example, the USD Index’s RSI is hovering near a similar level (marked with red ellipses), and back then, a corrective downswing also occurred at the previous highs. More importantly, though, the short-term weakness was followed by a profound rally in 2014, and many technical and fundamental indicators signal that another reenactment could be forthcoming. 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 the ones 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 still remains at the dollar’s back. Please see below: The bottom line? With my initial 2021 target of 94.5 already hit, the ~98 target is likely to be reached over the medium term, and the USDX will likely exceed 100 at some point over the medium or long term. Keep in mind though: we’re not bullish on the greenback because of the U.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 remains in the driver’s seat and new highs should materialize over the medium term. And while gold, silver and mining stocks have rode the S&P 500 higher recently, history has been unkind when the precious metals ignore technical and fundamental realities. Moreover, with gold, silver, and mining stocks’ strong negative correlations with the U.S. dollar standing the test of time, it’s likely only a matter of time before investors realize this as well. 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.
Bitcoin rockets from best support at 60500/60000

Bitcoin rockets from best support at 60500/60000

Jason Sen Jason Sen 09.11.2021 08:27
Bitcoin rockets from best support at 60500/60000 & through he all time high at 66500/67000 as predicted, initially targeting 69500/70000 Ripple through 6 month trend line resistance at 12300/400 for a buy signal. Ethereum longs at best support at 4380/4340 work on the run to the next target of 4800.Today's Analysis Bitcoin longs from anywhere above 60000 this trade worked perfectly as we beat 66500/67000 as expected initially targeting 69500/70000. We should struggle so do not be surprised to see some profit taking. However a break above 70000 is a good buy signal & can take us as far as 70000/78000. Downside is expected to be limited with first support at 67000/66500. Longs need stops below 66000. Ripple break above 12400 is an important medium term buy signal initially targeting 12800/850 & 13050. Support at 12300/12200. Best support at 11800/11700. Longs need stops below 11600. Ethereum longs at best support at 4380/4340 worked on the bounce back above 4475/55 to the targets of 4600/50 & 4800 & hopefully as far as 4950/5000 this week. Downside is expected to be limited with minor support at 4650/40. Best support at 4520/4480. Longs need stops below 4430. Emini S&P December hitting the targets as far as 4696/99 before reversing from 4712 & we are closing in on first support at 4675/70 this morning. Nasdaq December seeing a little profit taking from our 16420/440 target but downside should be limited in the bull trend with no sell signal yet, despite overbought conditions. Emini Dow Jones December we wrote: hit the next target of 36000/100 & if we continue higher in the bull trend look for 36250/280. Target hit with a new all time high at 36375. Today's Analysis. Emini S&P meets first support at 4675/70. Longs need stops below 4665 but then expect strong support at 4650/45. Try longs with stops below 4635. Unlikely but further losses meet an excellent buying opportunity at 4615/05. Longs need stops below 4595. The only resistance is at 4710/15. You would have to brave or crazy to sell short in this endless bull market! A break above 4720 targets 4735/40 then 4760. Nasdaq December straight to the next target of 16420/440 with a new all time high only 8 ticks above!! Eventually we can reach 16700, perhaps this week. Then we look for 16850. First support at 16260/240 likely to be tested this morning, but below here meets second support at 16140/120. Unlikely but further losses meet a buying opportunity at 15970/920. Longs need stops below 15890. Emini Dow Jones December new all time high at 36375 but watch resistance at 36410/440. I certainly do not recommend a short but we could pause here. If we continue higher look for 36490/500 & 36750/800. First support at 36100/35950. Best support at 35700/650. Longs need stops below 35550. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
The uncertain certainty of bitcoin

The uncertain certainty of bitcoin

Korbinian Koller Korbinian Koller 09.11.2021 10:24
Some might argue that it is best to sit on one’s hands and wait for a time when bitcoin prices are suppressed, and they have a point with the possibility of a market crash. And then again, they might have said that already when bitcoin was still trading at US$3,000 (we do not find it likely that bitcoin will ever retrace to those levels again.). Where are the uncertainties in bitcoins certainty? When you dissect a complex mechanism, you will always find a problem. It is like going to the bakery. It would be foolish to expect to get anything else but bread. Maybe it is better to look at a glass half full, meaning why not look at why bitcoin could be a certainty? BTC in US-Dollar, Monthly Chart, every buyer is a winner if he didn’t sell: Bitcoin in US-Dollar, Monthly chart as of November 9th, 2021. The monthly chart above certainly shows that whoever bought in the past has made a profit by now. Yet, we know “hodling” isn’t an easy thing. Personal risk appetite determines the number of bitcoin that can be held throughout these boom and bust cycles. We solved this dilemma through our quad exit strategy. And we teach low-risk position size building in our free telegram channel. BTC in US-Dollar, Weekly Chart, new all-time highs: Bitcoin in US-Dollar, Weekly chart as of November 9th, 2021. Now, moving forward to real-time, we can make out a similar bullish picture on the weekly chart after our glimpse in the past. Recent events provide data that substantiates bitcoin’s long-term certainty. A look at the last two weeks of October (marked in white) reveals a very brief battle with a minimal retracement level at the double top of all-time highs. Bears barely get a foot in the door, where typically bitcoin experiences significant retracements. To us, a clear sign that the rush is on. Big player money is now rushing to accumulate the necessary size they aim to hold on their books for the long term. Consequently, reducing volatility, one of the most feared aspects of bitcoin, which in times to come will attract more market players to this trading vehicle.   BTC in US-Dollar, Monthly Chart, six figures in 2022: Bitcoin in US-Dollar, Monthly chart as of November 9th, 2021. A look into the future from a monthly chart perspective is confidence building as well. With new all-time high prices printing at the time of publication of this chart book, our bet is still on bitcoin with a 63% over 47% chance that prices will advance from here rather than retracing to a substantially lower price level. So far, bitcoin has done nothing else but eradicate the uncertainties placed in its way. The most stubborn doubter would likely be happy if they had picked up a few coins when they traded at a dollar. What provides confidence for our forecast is the confirmation that bitcoin price retracements are now more modest. This lets us assume that the number of professional traders participating in this market has increased. In the monthly chart above, you can make out that closing prices of the month’s May, June, and July this year closed above the 50% Fibonacci retracement levels. A conservative retracement for bitcoins historical standards. We project for the near term that bitcoin will reach six-figure prices in mid-February next year. The uncertain certainty of bitcoin: From the anticipatory perspective, it seems evident that holding bitcoin is a prudent move with a look into the future. A hedge is needed once the risk is apparent to all, and the house of cards will tumble.  From a real-time perspective, we also find bitcoin to be a “must-own.” The charts above showed the strength with which bitcoin is aching to claim its turf, and it is never good to wait till “fear of missing out” kicks in, and low-risk entry opportunities become scarce.  And from a reactionary perspective, a look in the past, it is evident that anybody would like a piece of the action where bitcoin has nothing but a stunning history of unheard percentage moves and made it from eight cents to US$ 67,000 in just a dozen years.  There are always uncertainties in speculative ventures, but bitcoin itself is a certainty, not to be rationalized away for the years to come. 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 subscribe to our free newsletter. This article does 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 Korbinian Koller|November 9th, 2021|Tags: Bitcoin, bitcoin consolidation, Bitcoin mining, crypto analysis, Crypto Bull, crypto chartbook, crypto mining, low risk, quad exit, technical analysis, trading education|0 Comments About the Author: Korbinian Koller Outstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent. Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.
Intraday Market Analysis – GBP Seeks Support

Intraday Market Analysis – GBP Seeks Support

John Benjamin John Benjamin 09.11.2021 09:01
EURGBP sees a temporary pullback The sterling inched higher as traders took profit after the BOE’s dovish shift last week. The rally above the supply area of 0.8570 is a sign of commitment from the buy-side. Strong momentum has forced the bears to rush for the exit door. 0.8620 is now the next resistance. Its break would bring the euro to September’s high at 0.8660, where a breakout may lead to a bullish reversal in the medium-term. In the meantime, an overbought RSI is causing a pullback. The base of the latest surge at 0.8465 is an important support. NZDUSD tests key resistance The New Zealand dollar recoups losses as risk appetite recovers. The pair has met buying interest at 0.7070 along the 20-day moving average. A bullish RSI divergence is a sign that the bearish momentum has waned. When this happens in a demand zone, it makes a rebound of greater significance. 0.7180 is a major hurdle ahead following a previously botched bounce. Its breach may resume the kiwi’s uptrend above 0.7220. The RSI’s double top in the overbought area may briefly limit the bullish impetus. GER 40 consolidates gains The Dax 40 continues to rally in hopes of a prolonged low-rate environment. The bulls are pushing towards 16200 after the index reached the milestone at 16000. However, the RSI’s multiple ventures into the overbought area and a bearish divergence indicate that the rally may have overextended. A temporary pullback would be necessary to let the bulls catch their breath. 15920 is the immediate support. Further down, 15730 on the 20-day moving average would be an area of interest.
Bitcoin is climbing undeterred higher

Bitcoin is climbing undeterred higher

Korbinian Koller Korbinian Koller 02.11.2021 11:02
Bitcoin is volatile and nosedives in some of these attacks. A historical look back illustrates how bitcoin each time is climbing higher right after: 2009 traded for free (zero value) between enthusiasts 2010 worth US$0.08 2011 from US$1 up to US$32 back down to US$2 2012 from US$4.80 up to US$13.20 2013 from US$13.40 up to US$1,156 and down to US$760 2014 – 2016 down to US$315 2017 up to US$20,089 2018 down to US$3,122 2019 up to US$13,880 2020 up to US$34,800 2021 up to US$67,016 And these last three years, bitcoin has been climbing higher, undeterred. BTC in US-Dollar, Monthly Chart, bitcoin, a true winner: Bitcoin in US-Dollar, Monthly chart as of November 2nd, 2021. The monthly chart above illustrates bitcoin’s winning characteristics. We can see harmonious swings. Retracements are substantial, but bitcoin shows a persistent tendency to outperform previous all-time highs. BTC in US-Dollar, Weekly Chart, explosive recent history: Bitcoin in US-Dollar, Weekly chart as of November 2nd, 2021. The weekly chart points towards more explosive moves recently. After a breakout of a multi-year range, we can see that bitcoin has started to move substantially due to more widespread adoption. Swing behavior is getting more harmonious. At the moment, we are in the midst of a battle between bears and bulls at a double top formation. Consequently, the following days to weeks will show who will come out ahead. The fact that bulls cling to their winnings for this long gives price in this pat situation a slight edge for the bullish corner.   BTC in US-Dollar, Daily Chart, stepping away from the noise: Bitcoin in US-Dollar, Daily chart as of November 2nd, 2021. The daily chart can be pretty volatile. These smaller time frames are advised only to be traded if you are a professional. This applies particularly to struggle zones like the one we are currently in, for instance. Intraday swings can get substantial. In addition, once these battles between bears and bulls resolve, daily percentage moves can be staggering. Luckily, one doesn’t need to fear such challenging trading environments. To clarify, step up to larger time frames and reduce trade frequency and position size. Accept the risk based on adequate position size to your individual psychology and risk appetite. Consequently, buying for the long term will become much easier. It is essential as such to be familiar with a trading object’s typical behavior and, in bitcoins case, not to forget its ability to shine after a major setback. Bitcoin is climbing undeterred higher: Overall, bitcoins’ technical personality makes it an easy choice for one’s wealth preservation portfolio. Especially when options for wealth preservation investments are limited! This year’s strength towards gold and silver price performance had us increase bitcoins percentage allocation within the long-term portfolio. It fulfills two valuable functions to firmly find its place under historically much longer established counterparts. Scarcity for stability, and a more considerable performance potential necessary to protect against inflation. 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 subscribe to our free newsletter. This article does 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.
Gold, Silver, and Miners Just Can’t Jump

Gold, Silver, and Miners Just Can’t Jump

Przemysław Radomski Przemysław Radomski 03.11.2021 15:17
Let’s face it, the metals are not having an easy time breaking out. Short-term rallies end up going nowhere and bearish signs are still in abundance. Yesterday’s session was once again quite informative, and so is today’s pre-market trading. In yesterday’s analysis, I emphasized the importance of the relative weakness that we just saw in mining stocks, so let’s start with taking a look at what mining stocks did yesterday. At first glance, yesterday’s performance might look like a bullish reversal, but zooming in clarifies that something else was actually in the works. Let’s take a look at the GDXJ 1-hour candlestick chart for details. Yesterday’s “reversal” was actually a breakdown below the previous (mid-October) intraday lows along with the verification thereof. The GDXJ moved below the above-mentioned lows and – while it moved back up – it ended the session below them. This is a bearish type of session. Also, if you were wondering about the high volume in the final hour of trading – that’s relatively normal as that’s when bigger trades tend to take place. And while mining stocks were busy verifying the breakdown, gold tried to break above its declining, red resistance line, and verify that breakout. While yesterday’s session didn’t bring much lower gold prices (and the invalidation), today’s pre-market trading makes it clear that the attempt to break higher failed. Just like I had indicated yesterday. This time the rising short-term support line is not there to prevent further declines as the breakdown below it was also confirmed. What does it mean? It means that gold is likely to fall, and quite likely it’s going to fall hard. Besides, silver price is after a major short-term breakdown, too. After a powerful short-term rally, silver had reversed, and now it broke below its rising support line. That’s yet another bearish indication. Please note that at first silver was reluctant to decline while mining stocks moved decisively lower, which was normal during the early part of a given decline. Silver did some catching-up action yesterday, but since miners are not showing strength, I’d say that we’re getting to the regular part of a short-term move, not close to its end. And the move lower is likely to continue, just as the move higher is likely to continue in case of the USD Index. The USDX is after a verification of the breakout to new 2021 highs and after an about monthly consolidation above them. This is a perfect starting point for a major upswing, and we’re likely to see one soon. All in all, while the outlook for the precious metals sector is very bullish for the following years, it’s very bearish for the following weeks. 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.
Great Profitable Runs

Great Profitable Runs

Monica Kingsley Monica Kingsley 09.11.2021 15:04
S&P 500 pause goes on, and bonds support more of it to come. Tech keeps thus far the high ground gained, but value is showing signs of very short-term weakness – and yields haven‘t retreated yesterday really. The correct view of the stock market action is one of microrotations unfolding in a weakening environment – one increasingly fraught with downside risks. To be clear, I‘m not looking for a sizable correction, but a very modest one both in time and price. It‘s a question of time, and I think it would be driven by tech weakness as the sector has reached lofty levels. It‘ll go higher over time still, but this is the time for value and smallcaps in the medium term.The dollar though isn‘t putting much pressure on stock, commodity or precious metals prices at the moment – such were my yesterday‘s words:(…) when the dollar starts rolling over to the downside (I‘m looking at the early Dec debt ceiling drama to trigger it off), emerging markets would love that. And commodities with precious metals too, of course – sensing the upcoming greenback weakness has been part and parcel of the gold and silver resilience of late. Precious metals are only getting started, but the greatest fireworks would come early spring 2022 when the Fed‘s failure to act on inflation becomes broadly acknowledged.For now, they‘re still getting away with the transitory talking points, and chalking it down to supply chain issues. As if these could solve the balance sheet expansion or fresh (most probably again short-dated) Treasuries issuance (come Dec) – the Fed is also way behind other central banks in raising rates. Canada, Mexico and many others have already moved while UK and Australia are signalling readiness – the U.S. central bank is joined by ECB in hesitating.And that‘s what precious metals would be increasingly sniffing out. Commodities are joining in the post-taper celebrations, and my prior Tuesday‘s market assessments are coming to fruition one by one. Oil is swinging higher and hasn‘t topped, copper is coming back to life, and cryptos aren‘t in a waiting mood either.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 pause is here, and all that‘s missing, is emboldened bears. They may or may not arrive given that VIX keeps looking lazy these days – either way, the risks to the downside are persisting for a couple of days at least still.Credit MarketsHYG strength evaporated, but it‘s on a short-term basis only. The broader credit market weakness would get reversed, but it‘s my view that quality debt instruments would be lagging.Gold, Silver and MinersGold and silver continue reversing the pre-taper weakness – the upswing goes on, but is likely to temporarily pause as the miners‘ daily weakness foretells. Still, I‘m looking for more gains with every dip being bought.Crude OilCrude oil bulls continue having the upper hand, no matter the relative momentary stumble in maintaining gains – the energy sector hasn‘t peaked by a long shot.CopperCopper is participating in the commodities upswing – not too hot, not too cold. Just right, and it‘s a question of time when the red metal would start visibly outperforming the CRB Index again.Bitcoin and EthereumBitcoin and Ethereum consolidation has indeed come to an end, and both leading (by volume traded) cryptos are primed for further gains. SummaryS&P 500 breather remains a question of time, but shouldn‘t reach far on the downside – the bears are having an opportunity to strike as credit markets have weakened, and there isn‘t enough short-term will in tech to go higher still. The very short-term picture in stocks is mixed, but downside risks are growing. The dollar is already weakening, much to the liking of commodities and precious metals – there is still enough liquidity in the markets as any taper can be easily offset by withdrawing repo money sitting on the Fed‘s balance sheet.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.
US indices retreat as Tesla drags market

US indices retreat as Tesla drags market

Walid Koudmani Walid Koudmani 10.11.2021 13:14
US indices retreat as Tesla drags market Wall Street interrupted a winning series with the S&P 500 index closing lower for the first time in 9 days and with the Nasdaq being the worst performing index after it was pressured significantly by the plunge of Tesla shares, caused partly by comments made by the CEO Elon Musk in which he indicated the possibility of selling a portion of his shares if a twitter poll were to decide accordingly.  Today, investors await US CPI inflation data which is expected to show an increase of 5.8% y/y and which could potentially influence the FED to further adjust it's QE tapering after it's announcement in the most recent central bank meeting. Furthermore, earnings reports from Disney and Beyond Meat could also be worth keeping an eye on after this earnings season has proved to be surprisingly positive for the majority of companies.  Marks and Spencer posts strong Q3 results  M&S H1 results indicated a significant rebound in sales and a performance recovery which could be attributed to underlying improvements in all main businesses along with a reduction of net debt as the company has managed to effectively adapt to changing conditions. Better than expected financial results, along with a clear plan to continue expanding thanks to more partnerships and store openings, continue to provide reassurance to investors who may be finally looking past the noticeable impact the pandemic has had on the business in recent times.
Intraday Market Analysis – Euro Attempts To Bounce

Intraday Market Analysis – Euro Attempts To Bounce

John Benjamin John Benjamin 10.11.2021 08:58
EURUSD meets resistance The euro finds support from an upbeat economic sentiment from across the block. The pair has met buying interest in the demand zone around 1.1520. A bullish RSI divergence suggests that sellers may have taken their feet off the pedal. Subsequently, a break above 1.1560 prompted the short side to cover. 1.1615 is a key supply zone from last week’s sell-off, after which the bulls need to lift offers near 1.1690 before a reversal could gain traction. On the downside, a fall below 1.1550 may call the rebound into question. XAGUSD awaits breakout Bullions rise as the US dollar retreats ahead of the release of inflation data. A bullish MA cross on the daily chart is a sign that sentiment could be turning around. Silver is testing the September high of 24.80. A bullish breakout would trigger an extended rally towards 26.00. However, the RSI’s double top in the overbought area has held buyers back as the market awaits new catalysts. A combination of profit-taking and fresh selling could drive the price lower. The base of a previous breakout at 23.70 would be a support. US 500 seeks support The S&P 500 consolidates gains over strong corporate earnings and improved economic outlook. The divergence between the 20 and 30-day moving averages indicates an acceleration in the rally. Though there is a chance of a pullback after the RSI shot into the overbought area. The bullish bias means that buyers may be eager to jump in during a correction. The index is hovering above 4660. 4625 on the 20-day moving average would be the second line of defense. On the upside, a rebound would lead to 4750.
How Strange! Gold Rises on Strong Payrolls!

How Strange! Gold Rises on Strong Payrolls!

Arkadiusz Sieron Arkadiusz Sieron 09.11.2021 15:20
US economy added 531,000 jobs in October, surpassing expectations. Gold reacted… in a bullish way, and jumped above $1,800! The October nonfarm payrolls came surprisingly strong. As the chart below shows, the US labor market added 531,000 jobs last month, much above the expectations (MarketWatch’s analysts forecasted 450,000 added jobs). So, it’s a nice change from the last two disappointing reports. What’s more, the August and September numbers were significantly revised up – by 235,000 combined. Let’s keep in mind that we also have the additions of 1,091,000 in July and 366,000 in August (after an upward revision). Additionally, the unemployment rate declined from 4.8% to 4.6%, as the chart above shows. It’s a positive surprise, as economists expected a drop to 4.7%. In absolute terms, the number of unemployed people fell by 255,000 - to 7.4 million. It’s a much lower level compared to the recessionary peak (23.1 million), however, it’s still significantly higher than before the pandemic (5.7 million and the unemployment rate of 3.5%). Implications for Gold What does the recent employment report imply for the precious market? Well, gold surprised observers and rallied on Friday despite strong nonfarm payrolls. As the chart below shows, the London P.M. Fix surpassed the key level of $1,800. To show gold’s reaction more clearly, let’s take a look at the chart below, which shows that the price of gold futures initially declined after the October Employment Situation Report release. Only after a while, it rebounded and rallied to about $1,820. It’s a surprising behavior, as gold usually reacted negatively to strong economic data. Until now, gold liked weak employment reports as they increased the chances of a dovish Fed that would continue its easy monetary policy. Now, something has changed. But what? Well, some analysts would say that nothing has changed at all. Instead, they would tell us that the latest employment report is not as strong as it seems. In particular, the labor force participation rate was unmoved at 61.6% in October and has remained within a narrow range of 61.4% to 61.7% since June 2020, as the chart below shows. The lack of any improvement in the labor force participation rate could be interpreted as a lack of full employment and used by the Fed as an excuse to leave interest rates unchanged for a long time. I’m not convinced by this explanation. “Full employment” does not mean that all people are working, but all people who want to work are working. And, as the chart above shows, the fact that after the Great Recession the labor participation rate didn’t move back to the pre-crisis level didn’t prevent the Fed from hiking interest rates in 2015-2019. There is also another possibility. It might be the case that investors are now focusing on inflation. The employment report showed that the average hourly earnings have increased by 4.9% over the past twelve months, raising some concerns about wage inflation and general price pressure in the economy. Remember: context is crucial. If the new narrative is more about high inflation, good news may be positive for gold if they also indicate strong inflationary pressure. Although I like this explanation, it’s not free from shortcomings. You see, stronger inflation concerns should increase inflation premium and bond yields. However, the opposite is true: the real interest rates declined last week (see the chart below), enabling gold to catch its breath. After all, the markets are expecting a more dovish Fed than before the announcement of tapering. This is a fundamentally positive development for the gold market. Having said that, it’s too early to declare the start of the breakout. If inflation stays high, the US central bank could have no choice but to hike interest rates next year. Also, although the recent jump despite strong payrolls is encouraging, gold has yet to prove that it can stay above $1,800. 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
EURUSD well established so we keep trading them until prices breakout of the range.

EURUSD well established so we keep trading them until prices breakout of the range.

Jason Sen Jason Sen 10.11.2021 14:24
EURUSD levels are well established so we keep trading them until prices breakout of the range. We have shorts at first resistance at 1.1600/10 from yesterday USDCAD we have longs at 1.2440/20 targeting strong resistance at 1.2510/30. GBPCAD beat strong resistance at 1.6860/70 but meets a selling opportunity at 1.6930/50 with stops above 1.6970. Update daily at 06:30 GMT Today's Analysis. EURUSD strong resistance at 1.1600/10. Shorts need stops above 1.1630. A break higher can target strong resistance at 1.1695/1.1705. Exit longs & try shorts with stops above 1.1720. A break higher is a buy signal targeting 1.1765/70 & 1.1800/10. Shorts at 1.1600/10 target 1.1570/60 (hit), perhaps as far as first support at the October low at 1.1530/20. A break below 1.1510 is a sell signal initially targeting 1.1490 & although this could hold initially (a low for the day certainly possible but longs are risky) we eventually expected to target 1.1430/20. USDCAD longs at 1.2440/20 target strong resistance at 1.2510/30. Shorts need stops above 1.2550. First support at 1.2440/20 but longs need stops below 1.2410. A break below here targets 1.2370/65 perhaps as far as support at 1.2300/1.2280. Longs here need stops below 1.2270. A break lower is a sell signal. GBPCAD selling opportunity at 1.6930/50 with stops above 1.6970. A break higher however targets 1.7050/70. Shorts at 1.6930/50 target 1.6860, perhaps as far as 1.6810. A low for the day is possible here but further losses are likely to retest last week's low at 1.6735/25. GBPUSD beat 1.3510/30 to target 1.3570/80 & my selling opportunity at 1.3600/20. Shorts here worked perfectly with a high for the day at 1.3607 & a collapse to my target of 1.3525/15. In fact this was also the low for the day. EURGBP shorts at the 200 day moving average at 8585 work on the slide to second support at 8520/10 for profit taking on any remaining shorts. A low for the day exactly here so longs also worked on the bounce to 8550. GBPNZD shot higher to strong resistance at 1.9050/70 but shorts need stops above 1.9090 (which looks likely today's high as I write). Update daily at 07:00 GMT Today's Analysis. GBPUSD try shorts again at 1.3600/20 targeting 1.3560, perhaps as far as minor support at 1.3525/15. Below here look for 1.3470/60. A selling opportunity at 1.3600/20. Try shorts with stops above 1.3635. A break higher targets 1.3570/75. EURGBP holding below 8550 retests support at 8520/10. Try longs again with stops below 8500. A break lower targets 8475. Longs at 520/10 target 8550 before first resistance at the 200 day moving average at 8585/95. A break above 8600 is a buy signal for this week. GBPNZD shorts at strong resistance at 1.9050/70 target 1.9895, perhaps as far as 1.8950. A break above 1.9090 targets 1.9170/80. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
Profiting on Hot Inflation

Profiting on Hot Inflation

Monica Kingsley Monica Kingsley 10.11.2021 16:08
S&P 500 pause finally went from sideways to down, and might not be over yet. Credit markets aren‘t nearly totally weak – tech simply had to pause, so did semiconductors, and the Tesla downswing took its toll. Value though recovered the intraday downside, and VIX retreated from its daily highs – that may be all it can muster. I‘m looking primarily at bond markets for clues, and these reacted to the PPI figures with further decline in yields.At the same, inflation expectations are moving higher – the more you shorten the maturity, the higher they go, let alone RINF, their key ETF. Markets will be proven very wrong about the transitory inflation complacency – inflation rates aren‘t going to decline if you just leave them alone. And taper coupled with rate hikes hesitancy won‘t do the trick either.S&P 500 is still primed to go higher – the only question is the shape of the current consolidation. Liquidity is still ample, the banking sector is strong, and the Russell 2000 isn‘t really retreating. As stated yesterday:(…) The correct view of the stock market action is one of microrotations unfolding in a weakening environment – one increasingly fraught with downside risks. To be clear, I‘m not looking for a sizable correction, but a very modest one both in time and price. It‘s a question of time, and I think it would be driven by tech weakness as the sector has reached lofty levels. It‘ll go higher over time still, but this is the time for value and smallcaps in the medium term.Precious metals are consolidating – it‘s almost a pre-CPI ritual, but under the surface, the pressure to go higher keeps building. I‘m looking for a strong Dec in gold and silver, with unyielding oil and copper gradually waking up. Cryptos aren‘t taking prisoners either.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 finally declined, and the very short-term picture is unclear – is the dip about to continue, or more sideways trading before taking on prior highs? It‘s a coin toss.Credit MarketsHYG recouped some of the prior downside, but the LQD and TLT upswings give an impression of risk-off environment. Sharply declining yields aren‘t necessarily positive for stocks, and such is the case today.Gold, Silver and MinersGold and silver look like briefly pausing before the upswing continues – miners are pulling ahead, and the ever more negative real rates are powering it all.Crude OilCrude oil bulls continue having the upper hand, and oil sector is also pointing at higher black gold prices to come. Energy hasn‘t peaked by a long shot.CopperCopper went at odds with the CRB Index, but that‘s not a cause for concern. It‘ll take a while, but the red metal would swing upwards again.Bitcoin and EthereumBitcoin and Ethereum are briefly consolidating, and a fresh upswing is a question of shortening time. SummaryS&P 500 remains momentarily undecided, but the pullback shouldn‘t reach far on the downside – the bears are having an opportunity to strike on yet another hot inflation numbers. This isn‘t transitory really as I‘ve been telling you for almost 3 quarters already. Needless to say, the fire under real assets is being increasingly lit – more gains in commodities, precious metals and cryptos are ahead as inflations runs rampant on the Fed‘s watch.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.
Intraday Market Analysis – USD Cuts Through Resistance

Intraday Market Analysis – USD Cuts Through Resistance

John Benjamin John Benjamin 11.11.2021 09:26
USDJPY attempts a bullish reversalThe US dollar broke higher after October’s CPI exceeded expectations.On the daily chart, the RSI has dropped back into the neutrality area. The greenback has secured bids around the 30-day moving average. An oversold RSI on the hourly chart attracted a ‘buying-the-dips’ crowd at 112.70.The latest surge above the psychological level of 114.00 has prompted sellers to cover their bets, paving the way for a bullish reversal above 114.25. Before that, an overbought RSI may lead to a pullback towards 113.05.XAUUSD breaks resistanceRising US CPI boosts the demand for gold as an inflation hedge.After being unable to clear the daily chart’s triple top at 1833 over the course of the summer, the precious metal has cut through the resistance like a hot knife through butter. High volatility suggests that sellers were quick to bail out.As momentum traders jump in, the bullish breakout would lead to an extended rally towards 1900. An overbought RSI may cause a limited pullback. In that case, 1823 at the base of the rally may see strong buying interest.USOIL retreats from resistanceWTI crude edged lower after the EIA reported a slight rise in US inventories. The price’s swift recovery above the sell-off point at 83.00 is an indication that sentiment remains overall optimistic.However, the previous peak and psychological level of 85.00 seems like a tough hurdle to overcome for now. An overbought RSI has triggered a temporary pullback with a break below 81.90. In turn, this is deepening the correction towards 79.30.Trend followers may see the limited retracement as an opportunity to stake in.
GBP tries to recover after disappointing UK GDP figures

GBP tries to recover after disappointing UK GDP figures

Walid Koudmani Walid Koudmani 12.11.2021 11:12
GBP tries to recover after disappointing UK GDP figures The Pound is attempting to recover after today's disappointing preliminary UK GDP report provided another worrying sign for the post-pandemic recovery, showing a growth of 1.3% compared to the expected 1.5%. Furthermore, as the economy contends with rising inflation, supply shortages and labour issues, pressure remains on the Bank of England to adjust monetary policy after it chose to remain on hold in the latest meeting. Consumer spending rebounds despite supply issues and rising costs  While UK GDP figures came in below expectations, consumer spending managed to rebound significantly in October with an increase of 14,2% as a rise in demand for takeaways and digital entertainment boosted spending. Despite ongoing inflation concerns and rising household bills, consumer spending increased in several sectors but fell slightly when it came to retail spending as interest in goods such as clothing decreased while the travel sector had it's best month since before the pandemic with spending on international travel recovering noticeably. These figures provide an encouraging sign for the economy as it heads into the festive season but as supply shortages,rising inflation and labour issues persist, it will be essential to see how the government and BoE adapt to the situation moving forward. Download our Mobile Trading App:   Google Play   App Store  
Labour issues persist as UK struggles with vacancies

Labour issues persist as UK struggles with vacancies

Walid Koudmani Walid Koudmani 12.11.2021 11:12
Labour issues persist as UK struggles with vacancies The labour market in the UK continues to struggle with the post-pandemic recovery after today's REC figures showed active job postings reaching 2.68 million in the first week of November and indicated the fourth highest weekly increase since the start of 2020 despite rising costs of living. This highlights the ongoing labour market issues which many businesses are being impacted by and which has forced a number of companies to relocate in order to adapt. While there are several factors which have led to this situation, it remains a key issue in need of resolution as it will undoubtedly impact growth prospects moving forward since it is showing no sign of slowing down. Despite the fact that the situation in the UK was exacerbated by Brexit, this issue has not been excluse to the UK, as many other countries also contend with similar circumstances and as governments and central banks attempt to maintain the pace of the economic recovery.  Astrazeneca guidance unchanged after positive Q3 results Astrazeneca's Q3 results managed to exceed expectations with a growth in revenue in the third quarter of 50%. The company has benefited from the increase in sales seen during the pandemic but managed to further increase its performance by achieving eight positive phase three trials and acquiring Alexion. While operating expenses in the third quarter showed a significant increase, investors will be reassured by the company leaving its earnings guidance for the full year unchanged and by the prospects of new innovations moving forward. Download our Mobile Trading App:   Google Play   App Store  
Intraday Market Analysis – USD Seeks Support - 19.10.2021

Intraday Market Analysis – USD Keeps Bullish Momentum

John Benjamin John Benjamin 12.11.2021 09:33
GBPUSD buried in bearish territory The pound continues to retreat after Britain’s growth fell short of expectations in Q3. A break below September’s low at 1.3420 has invalidated the latest rebound, putting buyers on the defensive once again. The RSI’s double bottom in the oversold area may ease the bearish push momentarily. A bounce could be an opportunity to sell into strength. 1.3500 is the immediate resistance. On the downside, renewed momentum would drive price action towards last December’s lows around 1.3200. AUDUSD struggles for support The Australian dollar came under pressure after the unemployment rate returned above 5% last month. The sell-off continued after a brief pause over the 30-day moving average near 0.7390, turning the latter into a fresh resistance. The lack of support suggests increasingly downbeat sentiment. The base of October’s bullish breakout at 0.7240 is the next support. The RSI’s oversold situation may cause a limited rebound from the round number at 0.7300, though it is likely to turn out to be a dead cat bounce. US100 tests demand zone The Nasdaq 100 suffers losses as high inflation dents risk appetite. An RSI divergence showed a deceleration in the uptrend, a sign that the rally has overheated. Subsequently, a drop below 16200 has prompted leveraged buyers to exit for fear of a correction. As the RSI inched into the oversold territory, the index saw bids near the breakout zone (15900) from earlier this month. The support-turned-resistance at 16200 is the first hurdle. Then the bulls will need to clear 16400 before the rally can resume.
Netflix Stock (NFLX) Ahead Of Important Data, XAUUSD Chart's Reduced Amplitudes - Swissquote's MarketTalk

Inflation to the Moon - Gold Wears a Space Suit!

Arkadiusz Sieron Arkadiusz Sieron 11.11.2021 16:06
  Inflation rears its ugly head, surging at the fastest pace since 1990. The yellow metal has finally reacted as befits an inflation hedge: went up. Do you know what ambivalence is? It is a state of having two opposing feelings at the same time –this is exactly how I feel now. Why? Well, the latest BLS report on inflation shows that consumer inflation surged in October, which is something I hate because it lowers the purchasing power of money, deteriorating the financial situation of most people, especially the poorest and the least educated who don’t know how to protect against rising prices. On the other hand, I feel satisfaction, as it turned out that I was right in claiming that high inflation would be more persistent than the pundits claimed. After the September report on inflation, I wrote: “I’m afraid that consumer inflation could increase even further in the near future”. Sieron vs. Powell: 1:0! Indeed, the CPI rose 0.9% last month after rising 0.4% in September. The core CPI, which excludes food and energy prices, accelerated to 0.6% in October from 0.1% in the preceding month. And, as the chart below shows, the overall CPI annual rate accelerated from 5.4% in September to 6.2% in October, while the core CPI annual rate jumped from 4% to 4.6%. This surge (and a new peak) is a final blow to the Fed’s fairy tale about transitory inflation. As one can see in the chart above, the CPI rate has stayed above the Fed’s target since March 2021, and it won’t decline to 2% anytime soon. This contradicts all definitions of transitoriness I know. What’s more, the October surge in inflation was not only above the expectations – it was also the biggest jump since November 1990, as the chart below shows. Unfortunately for Americans, it might not be the last word of inflation. This is because over 80% of CPI subcomponents were above the Fed’s target of 2%, which clearly indicates that high inflation is not caused merely by the reopening of the economy but also by the broad-based factors such as the surge in the money supply.   Implications for Gold Ladies and gentlemen, gold finally reacted to surging inflation! As the chart below shows, the price of gold (Comex futures) spiked from below $1,830 to above $1,860 after the BLS report on CPI. Why did gold finally notice inflation and react as a true inflation hedge? Well, it seems that the narrative changed. Until recently, investors believed the Fed that inflation would be transitory. Reality, however, has disproved this story. Another factor I would like to mention is the FOMC’s recent announcement of tapering of its quantitative easing. That event removed some downward pressure from the gold market. By the way, this is something I also correctly predicted in the Fundamental Gold Report that commented on September inflation report: “it seems that until the Fed tapers its quantitative easing, gold will remain under downward pressure. Nonetheless, when it finally happens, better times may come for gold.” Indeed, yesterday’s rally suggests that gold recalled its function as a hedge against inflation. Until today, I was cautious in announcing the breakout in the gold market, as the yellow metal jumped above $1,800 only recently. However, the fact that gold managed not only to stay above $1,800 but also to continue its march upward (in tandem with the US dollar!) suggests that there is bullish momentum right now. Having said that, investors should remember about the threat of a more hawkish Fed. Higher inflation could support the monetary hawks within the FOMC and prompt the US central bank to raise interest rates sooner rather than later. The prospects of a tightening cycle could weigh on gold. However, as long as investors focus stronger on inflation than on tightening of monetary policy, and as long as the real interest rates decrease, or at do not increase, gold can go up. 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
HK Rallies and PBOC Cuts, US Stocks Stabilize

Focus on the Real Gains

Monica Kingsley Monica Kingsley 11.11.2021 15:51
S&P 500 declined, and not enough buyers arrived in my view. Still, we‘re likely to see a brief pause in selling, and that‘s giving the bulls a chance. Credit markets were a bit too beaten down by the troubled 30-year Treasury auction and Evergrande moving into the spotlight somewhat again. VIX managed another upswing, and doesn‘t point to the S&P 500 having gotten to an excessively bearish positioning just yet. I think some treading the water before stocks make up their mind, is most likely next. The downswing doesn‘t appear to be totally over, but we have arguably seen the greater part of it already. Tech isn‘t yet stabilized, but the increasing volume spells a pause in selling. I‘m still looking for clues to the bond markets. And it‘s clear that not even higher rates can sink the precious metals run – neither the late day rush to the dollar had that power. Miners continue behaving, and their daily black candle doesn‘t scare me – the realization of inflation not having peaked, and being as stubborn as I had been pounding the table since eternity, is working its magic: (…) inflation expectations are moving higher – the more you shorten the maturity, the higher they go, let alone RINF, their key ETF. Markets will be proven very wrong about the transitory inflation complacency – inflation rates aren‘t going to decline if you just leave them alone. And taper coupled with rate hikes hesitancy won‘t do the trick either. S&P 500 is still primed to go higher – the only question is the shape of the current consolidation. Liquidity is still ample, the banking sector is strong, and the Russell 2000 isn‘t really retreating. Precious metals are consolidating – it‘s almost a pre-CPI ritual, but under the surface, the pressure to go higher keeps building. I‘m looking for a strong Dec in gold and silver, with unyielding oil and copper gradually waking up. Cryptos aren‘t taking prisoners either. Crude oil is well bid in the $78 till $80 zone, and would overcome $85 – we aren‘t looking at a reversal, but at temporary upside rejection. Likewise copper would kick in with vengeance, and the shallow crypto consolidations are barely worth mentioning at all. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 decline continues, and the very short-term picture favors a little consolidation – the selling might not be over just yet. Credit Markets HYG, LQD and TLT – weakness anywhere you look, without tangible signs of stabilization, which makes any S&P 500 upswings a doubtful proposition. Gold, Silver and Miners Gold and silver look to be just getting started – the growing money flows aren‘t sufficient to push prices lower. Miners are pulling ahead, and the ever more negative real rates coupled with surging inflation fears (and Fed policy mistake recognition) are powering it all. Crude Oil Crude oil bulls would have to step in around the $80 level again, and it seems they wouldn‘t find it too hard to do. Yesterday‘s downswing looks like a daily setback only. Copper Copper downswing was again bought, and I‘m not looking for the bears to make much further progress as commodities appear ready to turn up again regardless of temporary dollar strength. Bitcoin and Ethereum Bitcoin and Ethereum are again briefly consolidating, and the bulls haven‘t really spoken their last word. It‘s a nice base building before another upleg. Summary S&P 500 is likely pausing for a moment here, and any further pullback isn‘t likely to reach far on the downside. The late day selloff in real assets was merely a brief, news-driven correction that would be reversed before too long, and precious metals are showing the way as inflation is moving back into the spotlight, and the talk about Fed‘s policy mistake is growing louder. 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.
Weekly Macro Themes - 12 November 2021

Weekly Macro Themes - 12 November 2021

Callum Thomas Callum Thomas 12.11.2021 15:36
Here's a brief overview of the topics and charts covered in the latest edition of the Weekly Macro Themes report. I send this report out late Friday NZ time and aim to cover a good mix of macro/ideas/risk topics, across a global macro/multi-asset universe. This week I covered the following topics/ideas:   1. US Credit Spreads: Continuing to monitor risk indicators for credit as valuations reach extreme expensive/complacent; focused on a specific set of macro indicators (which look good at the moment) as a trigger to shift bearish. 2. Gold Price Outlook: Slight change to the view given where technicals, sentiment, positioning, monetary signals and valuations sit. 3. Gold & USD: Conventional wisdom says a stronger dollar would be a headwind to gold, we dig into this conventional wisdom to see if it is actually wise and also review the outlook for the US dollar. 4. Gold Miners: Reviewing the outlook for gold miners given valuations, positioning, market breadth, technicals, and intermarkets. 5. Silver: We also review the suite of indicators for silver and lay out the near term outlook and parameters for the next steps.     Request a trial of our institutional research service for your firm, simply fill in the form here. (n.b. the full service is aimed at fund managers and institutional investors)       About the Weekly Macro Themes report The "Weekly Macro Themes" is part of our institutional offering aimed at multi-asset and macro-driven portfolio managers and strategists. The report takes a chart-driven macro, fundamental and multi-factor approach; a powerful combination of cross-asset idea generation for portfolio managers, charts on key global macro trends, analysis on portfolio risks, asset allocation research, and innovative indicators, in a format that delivers a balance of brevity and depth so that you can efficiently assimilate the insights. Also part of the service is the monthly market cycle guidebook, global cross asset market monitor, and quarterly strategy pack. (or just follow us for now): LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
Red Hot and Running

Red Hot and Running

Monica Kingsley Monica Kingsley 12.11.2021 15:44
S&P 500 really went through the brief pause in selling, but credit markets haven‘t stopped really. Their weakness continues, but is hitting value a tad harder than tech. Together with VIX turning south, that‘s one more sign why the bulls are slowly becoming the increasingly more favored side. Hold your horses though, I‘m talking about a very short-term outlook – this correction doesn‘t appear to be over just yet (the second half of Nov is usually weakner seasonally): (…) some treading the water before stocks make up their mind, is most likely next. The downswing doesn‘t appear to be totally over, but we have arguably seen the greater part of it already. … I‘m still looking for clues to the bond markets. There, it had been a one-way ride. TLT though is having trouble declining further, and that means a brief upswing carrying over into stocks, is likely. Primarily tech would benefit, and the ever more negative real rates would put a floor beneath the feverish precious metals run. Make no mistake though, the tide in gold and silver has turned, and inflation expectations aren‘t as tame anymore. In this light, there‘s no point in sweating the commodities retracement of late. True, the rising dollar is taking some steam out of the CRB superbull, but that‘s only temporary – I‘m looking for the greenback to reverse to the downside once the debt ceiling drama reappears in the beginning of Dec. Then, the Treasury would also have to start issuing more (short-term) debt, which would put a damper on any upswing attempts. Meanwhile, inflation would keep at least as hot as it‘sx been recently, and the Fed policy mistake in letting the fire burn unattended, would be more broadly acknowledged. What a profitable constellation for precious metals, real and crypto assets! Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 is bidding its time – the shallow very short-term consolidation continues, with the bears slowly running out of time (for today). Credit Markets HYG, LQD and TLT – weakness anywhere you look continues, but LQD is hinting at a possible stabilization next. Unless that‘s more broadly followed in bonds, any S&P 500 upswing would remain a doubtful proposition. Gold, Silver and Miners Gold and silver were indeed just getting started – a relatively brief pause shouldn‘t be surprising. Any dips though remain to be bought. All in all, PMs are firing on all cylinders currently. Crude Oil Crude oil bulls keep defending the $80 level, with $78 serving as the next stop if need be. The consolidation starting late Oct would though resolve to the upside in my view – it‘s just a question of shortening time. Copper Copper participated in the commodities upswing – not too enthusiastically, not too weakly. The volume seems just right for base building before another red metal‘s move higher. Bitcoin and Ethereum Bitcoin and Ethereum are still consolidating, and the relatively tight price range keeps favoring the bulls. Summary S&P 500 is looking at a mildly positive day today, but the correction isn‘t probably over just yet. With most of the downside already in, I‘m looking for bullish spirits to very gradually return. Precious metals will be the star performers for the many days to come, followed by copper and then oil. Crypto better days are also lyiing ahead. All in all, inflation trades will keep doing better and better. 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.
Will Evergrande Make Gold Grand?

Will Evergrande Make Gold Grand?

Arkadiusz Sieron Arkadiusz Sieron 12.11.2021 18:57
  Evergrande’s debt issues are a symptom of China’s deep structural problems. If the crisis spills over wider, gold may benefit, but we are still far from such a scenario. Beijing, we have a problem! Evergrande, one of China’s largest real estate developers and biggest companies in the world, is struggling to meet the interest payments on its debts. As the company has more than $300 billion worth of liabilities, its recent liquidity problems have sparked fears in the financial markets. They also triggered a wave of questions: will Evergrande become a Chinese Lehman Brothers? Is the Chinese economy going to collapse or stagnate? Will Evergrande make gold grand? The answer to the first question is: no, the possible default of Evergrande likely won’t cause a global contagion in the same way as Lehman Brothers did. Why? First of all, Lehman Brothers collapsed because of the run in the repo market and the following liquidity crisis. As the company was exposed to subprime assets, investors lost confidence and the bank lost its access to cheap credit. Lehman Brothers tried to sell its assets, which plunged the prices of a wide range of financial assets, putting other institutions into trouble. Unlike Lehman Brothers, Evergrande is not an investment bank but a real estate developer. It doesn’t have so many financial assets, and it’s not a key player in the repo market. The exposure of important global financial institutions to Evergrande is much smaller. What’s more, we haven’t seen a credit freeze yet, nor an endless wave of selling across almost all asset classes, which took place during the global financial crisis of 2007-2009. Given that the Lehman Brothers’ bankruptcy was ultimately positive for gold (although the price of the yellow metal declined initially during the phase of wide sell-offs), the fact that Evergrande probably doesn’t pose similar risks to the global economy could be disappointing for gold bulls. However, gold bulls could warmly welcome my answer to the second question: the case of Evergrande reveals deep and structural problems of China’s economy, namely its heavy reliance on debt and the real estate sector. As the chart below shows, the debt of the private non-financial sector has increased from about 145% of GDP after the Great Recession to 220% in the first quarter of 2021. So, China has experienced a massive increase in debt since the global financial crisis, reaching levels much higher than in the case of other economies. The rise in indebtedness allowed China to continue its economic expansion, but questions arose about the quality and sustainability of that growth. As Daniel Lacalle points out, The problem with Evergrande is that it is not an anecdote, but a symptom of a model based on leveraged growth and seeking to inflate GDP at any cost with ghost cities, unused infrastructure, and wild construction. Indeed, the levels and rates of growth of China’s private debt are similar to the countries that have experienced spectacular financial crises, such as Japan, Thailand, or Spain. But the significance of China’s real estate sector is much higher. According to the paper by Rogoff and Yang, the real-estate sector accounts for nearly 30% of China’s GDP. On the other hand, China has a relatively high savings rate, while debt is mostly of domestic nature. China’s financial ties to the world are not very strong, which limits the contagion risks. What is more, the Chinese government has acknowledged the problem of excessive debts in the private sector and started a few years ago making some efforts to curb it. The problems of Evergrande can be actually seen as the results of these deleveraging attempts. Therefore, I’m not sure whether China’s economy will collapse anytime soon, but its pace of growth is likely to slow down further. The growth model based on debt and investments (mainly in real estate) has clearly reached its limit. In other words, the property boom must end. Rogoff and Yang estimate that “a 20% fall in real estate activity could lead to a 5-10% fall in GDP”. Such growth slowdown and inevitable adjustments in China’s economy will have significant repercussions on the global economy, as – according to some research – China’s construction sector is now the most important sector for the global economy in terms of its impact on global GDP. In particular, the prices of commodities used in the construction sector may decline and the countries that export to China may suffer. Given that China was the engine of global growth for years, it will also slow down, and, with lower production, it’s possible that inflation will be higher. Finally, what do the problems of China’s real estate sector imply for the gold market? Well, in the short term, not so much. Gold is likely to remain under downward pressure resulting from the prospects of the Fed’s tightening cycle. However, if Evergrande’s problems spill over, affecting China’s economy or (a bit later) even the global economy, the situation may change. Other Chinese developers (such as Fantasia or Sinic) also have problems with debt payments, as investors are not willing to finance new issues of bonds. In such a scenario, the demand for gold as a safe-haven asset might increase, although investors have to remember that the initial rush could be into cash (the US dollar) rather than gold. Unless China’s problems pose a serious threat to the American economy, the appreciation of the greenback will likely counterweigh the gains from safe-haven inflows into gold. So far, financial markets have remained relatively undisturbed by the Evergrande case. Nevertheless, I will closely monitor any upcoming developments in China’s economy and their possible effects on the gold market. 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.
Half a Dozen Things You Should Know about FX

Half a Dozen Things You Should Know about FX

Marc Chandler Marc Chandler 12.11.2021 13:11
1.  The market is still digesting the implications of Wednesday's CPI shock. The dollar has strengthened, yields have risen, the stock market wobbled after a long advancing streak, and in any event, stabilized in light trading during the US and Canadian holidays. However, given the low year-ago reading, there is a significant risk that inflation (including the core rate) will accelerate over the next few months. As a result, the Federal Reserve needs greater flexibility to raise rates sooner than it has envisioned.   The main restraint now is the pace of tapering.  The FOMC committed to reducing its bond-buying by $15 bln in November and December.  Its statement indicated that it anticipated maintaining the rate afterward, but the FOMC also reserved the right to adjust the pace if necessary. Thus, accelerating the tapering is the most likely course of action.  Bullard had suggested completing the tapering by the end of Q1.  If this is to become the majority view, there may be some effort to prepare the market.   Recently a rally in US bonds was attributed to talk that Governor Brainard could replace Powell as Fed chair.  The argument was that Brainard was more dovish.  Is this really relevant now?  Does it count as a strike against her?  With Yellen's apparent support, Powell is most likely to get re-appointed, and given that CPI is at 30-year highs, conventional thinking favors maintaining a stable hand at the helm. 2.    The dollar's gains accelerated since the higher than expected CPI report.  The euro was in a $1.15-$1.17 range last month and broke out on Wednesday.  Follow-through selling Thursday brought to about $1.1445.  We have suggested the next target is a little below $1.1300.   The jump in yields helped lift the greenback from below JPY112.80 above JPY114.00.  The five-year high set on October 20 was around JPY114.70, while we project the upper end of the likely range closer to JPY115.00. 3.  Disappointing economic data contributed to the losses of sterling and the Australian dollar.   Economists (Bloomberg survey) expected Australia to have created 50k jobs in October, but, instead, it lost 46.3k jobs for the third consecutive monthly decline.  The bulk of the loss (40.4k) were full-time positions, which reversed the 26.7k increase reported in September.  The unemployment rate jumped to 5.2% from 4.6%, the highest since April.  The Australian dollar peaked near $0.7550 in late October and fell below $0.7300 on Thursday, for the first time in a month.  The next target is around $0.7240-$0.7260.   The UK reported a significant slow down in Q3 GDP to 1.3% from 5.5% in Q2. Expectations for a 1.5% quarter-over-quarter expansion  (Bloomberg survey) seemed on the high side.  However, the September monthly GDP rose 0.6%, and the better than expected rise was offset but a reduction in the August GDP to 0.2% from 0.4%. The industrial output contracted in September. The trade deficit deteriorated after a dramatic revision in the August balance (to -GBP1.880 bln from -GBP3.716 bln, while services accelerated (0.7% from a revised 0.1% gain that had initially reported at 0.3%).  Sterling, which had been pushing near $1.36 before the Bank of England's meeting and slipped to a marginal new low for the year on Wednesday but still held above $1.34 (barely).  It fell to $1.3360 on Thursday. The next chart support area is seen around $1.3165-$1.3185. 4.  The joint US-China statement at COP-26 is promising.  It was the key to the Paris Agreement in 2015.  There was a commitment to boost efforts to cut emissions and illegal deforestation.  The gap between current policies and what is necessary was acknowledged, and there appeared to be an agreement in principle to reach an agreement on climate finances and rules for a carbon market.  The joint statement must have been in the works even as Biden criticized Xi for the lack of commitment for not attending COP-26.  There is still much speculation about a "virtual summit," which is supposed to signal something more than two phone calls the leaders have held this year.  The environment was also recognized where cooperation was possible.  Still, Beijing refused to join the US-EU commitment to cut methane admissions and opted for its own plan.   The geopolitical competition is unaffected by the joint statement. Meanwhile, the more pressing geopolitical threat is coming from the movement of Russian forces to the Ukraine border.  Reports suggest the US has briefed Europe on a possible Russian invasion of Ukraine.  Hostilities are said to have escalated recently.  Recall that Russia had amassed forces (~100k soldiers, tanks, and aircraft) in the Spring too.  It triggered a flurry of talks, and Moscow removed (redeployed) its forces.  Russia defended the troop movement within the country as an internal affair but has accused the US of provocation for sailing warships into the Black Sea, close to its territory last week.  Putin also reportedly was critical of Ukraine's alleged use of drones, which violated a previous agreement.  Meanwhile, tensions on the Polish-Belarus border remain tense.  Merkel sought Putin's help recently to defuse the situation, but he refused.   Belarus is thought to be instigating a migration crisis and has threatened to shut down a critical gas pipeline to the EU if Poland keeps its border closed.  These developments may have contributed to some pressure on the euro.   5.  The Mexican peso fell by around 0.5% after the central bank lifted the overnight rate to 5.00%. It is the third quarter-point move in the cycle that began in June.   The swaps market has nearly 90 bp of tightening discounted over the next three months and almost 220 bp in the next 12 months.  Banxico lifted its Q4 inflation forecast to 6.8% from 6.2%.  The one dissent (Esquivel, again) was to stand pat.  There was no vote for a 50 bp move, which contributed to the dovish read of the rate hike.  October CPI, reported earlier this week, is at 6.24% year-over-year,  6.   Friday's economic calendar is light.  Little new data from the large Asia Pacific and European countries.  The North American calendar is minimal.  The US JOLTS report on job openings and the University of Michigan's preliminary estimate of November sentiment and inflation expectations.   NY Fed's Williams is the lone speaker from the central bank and may not address monetary policy directly.  There are three sets of chunky options that expire tomorrow that may be relevant:  1.23 bln euros at $1.1460, $1.75 bln at JPY114.00, and GBP690 mln at $1.3320.   Disclaimer
Crude Oil Eyeing EIA Figures – “Yoyo-Trade” Exited After Hitting All Projected Targets!

Crude Oil Eyeing EIA Figures – “Yoyo-Trade” Exited After Hitting All Projected Targets!

Sebastian Bischeri Sebastian Bischeri 10.11.2021 17:11
  Is crude really set to break its highs again? Fundamental Analysis Crude oil prices reached their last highs on Wednesday before pulling back, initially supported by US crude stocks falling as shown by API figures, and afterwards cooled by contrary prospects from the U.S. Energy Information Administration (EIA). Meanwhile, our subscribers were exiting their last oil trade, after the black gold hit the second projected target at $83.40 (see technical chart). U.S. API Weekly Crude Oil Stock: Inventory levels of US crude oil, gasoline and distillates stocks, American Petroleum Institute (API) via Investing Regarding the API figures published Tuesday, the decline in crude inventories (with 2.485 million barrels versus 1.900 million barrels expected) implies greater demand and is normally bullish for crude prices (at least in theory). This was indeed the case yesterday, as those figures have supported crude prices in the first place. In the perspective of the figures to be published later today by the U.S. Energy Information Administration (EIA), and according to the median of analysts surveyed by Bloomberg, the market would expect an increase of 1.6 million barrels, so let’s see whether this figure will be confirmed. Chart – WTI Crude Oil (CLZ21) Futures (December contract, daily chart) In summary, with an oil market progressing (with some rallying limitations set by threats of the US administration to release some of its strategic crude reserves – to relieve the market by artificially increasing the supply) – there is currently no trade position justified from a risk-to-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 Oil Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Sebastien BischeriOil & Gas Trading Strategist * * * * * The information above represents analyses and opinions of Sebastien Bischeri, & 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, Sebastien Bischeri and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s 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. Sebastien Bischeri, 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.
Gold: Don’t Fret the Small Stuff

Gold: Don’t Fret the Small Stuff

Przemysław Radomski Przemysław Radomski 10.11.2021 14:38
  Do small upswings really matter if one has medium-term goals in mind? Have the bulls come home?  The medium-term back and forth movement in gold continues. If I could make the markets move in a certain direction sooner, and end the prolonged consolidation, I would. However, I can’t, and the only thing that I can do is to report to you what I see on the markets and describe what my course of action will be. During yesterday’s session we saw more of what we’ve been seeing in the previous days. Gold moved higher, and gold stocks moved higher (but in a weak manner), and even though gold moved to new monthly highs, the HUI Index is not even back to its late-October highs. It’s boring, discouraging, and demotivating. But the only thing that we can do is to react to what the market is willing to provide us with. What do yesterday’s and today’s pre-market price moves tell us? First of all, the market tells us that the breakout to new highs in the USD Index is not being invalidated. I know that I’ve written this tens of times, but this factor remains intact and it continues to have very important implications going forward. These are bullish for the USD Index and bearish for the precious metals sector. Second, as I had already written earlier today, gold stocks are not showing strength relative to gold. The gold price just made new monthly highs and is now visibly above its October highs, but the silver price and – most importantly - gold stocks are not. In fact, they are just a little above their mid-October highs. Consequently, the thing that one tends to see in the final parts of a short-term rally remains in place. So, when will the decline in PMs finally continue? Based on what I wrote on Monday – in particular about gold’s reversal points, it’s likely to start soon – perhaps as early as this week. As a quick reminder, you can see gold’s triangle-vertex-based reversal on the chart below: And you can see gold’s long-term cyclical turning point on the chart below: The fact that gold moved to its recent medium-term highs is also a factor here. Resistance provided by those highs is quite likely to trigger a reversal in gold, and based on today’s pre-market action, it’s what we might already be seeing right now. The move lower is small so far, but all bigger moves have small beginnings, and given the reversal points and the resistance that gold just encountered, this could be “it”. Also, speaking of resistance levels, on today’s second chart I placed a red resistance line based on the previous highs. It might be tempting to view the price action below it as an inverse head and shoulders pattern, which could have bullish implications. However, let’s keep in mind that without a breakout above the neck level (approximately the previous highs), the formation is not yet complete, and as such it has NO bullish implications whatsoever, as it simply doesn’t exist yet. All in all, the outlook for the precious metals market is not bullish, even though the last several days / weeks might make one feel otherwise. Before viewing the recent move higher as something significant and/or bullish, please consider how tiny this upswing is compared to the decline in gold stocks between May and October. No market moves in a straight line, and periodic corrections are inevitable. It doesn’t make them a start of a new powerful upswing in each case, though. And if the part of the precious metals market that is supposed to rally the most at the start of a major upswing is so weak right now, then why should one expect the current upswing to be anything more than a corrective upswing within a bigger downtrend? 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: Inflation Fears May Push Stock Prices Lower

S&P 500: Inflation Fears May Push Stock Prices Lower

Paul Rejczak Paul Rejczak 10.11.2021 15:55
  Stocks’ short-term rally came to an end this week and the S&P 500 index entered a consolidation along the 4,700 level. Is this a topping pattern? The S&P 500 index lost 0.35% yesterday, as it fell below the 4,700 price mark following two-day-long consolidation along the Friday’s record high of 4,718.50. The recent rally was not broad-based and it was driven by a handful of tech stocks like MSFT, NVDA, TSLA. The market seems overbought in the short-term and most likely it’s trading within a topping pattern. Today we may see another consolidation or a profit taking action following worse than expected inflation data release (the CPI monthly number came at +0.9% vs. the expected +0.6%). The nearest important support level is at 4,650-4,675 and the next support level is at 4,600. On the other hand, the resistance level is at 4,700-4,720. The S&P 500 broke below its steep short-term upward trend line, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Nasdaq Lost 0.7% on Tuesday Let’s take a look at the Nasdaq 100 chart. The technology index broke above the 16,000 level recently and it was trading at the new record high. The market accelerated parabolically above its short-term upward trend line. But yesterday it lost 0.7% and closed below that trend line. The resistance level remains at 16,400, and the short-term support level is at 16,000, among others, as we can see on the daily chart: Apple’s Further Consolidation and Microsoft’s Potential Topping Pattern Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple continues to trade within a consolidation along the $150 level and it is still well below the record highs, and the Microsoft is close to breaking below its over month-long upward trend line. So the tech “megacaps” may be turning lower, as we can see on their daily charts: Conclusion The broad stock market went slightly lower on Tuesday and we may see a downward continuation this morning. The main indices are expected to open 0.2-0.5% lower following worse (higher) than expected consumer inflation number release. It looks like a topping pattern and we may see a downward correction at some point. There may be a profit-taking action following quarterly earnings releases. Here’s the breakdown: The S&P 500 extended its uptrend last week, but since Friday it is trading within a short-term downtrend. But still no positions are 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.
Intraday Market Analysis – USD Seeks Consolidation

Intraday Market Analysis – USD Seeks Consolidation

John Benjamin John Benjamin 15.11.2021 08:53
USDJPY hits temporary resistance The Japanese yen pulled back after a larger-than-expected GDP contraction in Q3. The US dollar is looking to hold onto its gains after a rally above 114.00. Sentiment has recovered and a surge above 114.45 around the October peak would resume the uptrend. However, the current rebound may lack the strength to clear the supply zone right away. An overbought RSI has held the bullish fever back. A breach below 113.70 would lead to a deeper correction towards 112.80, which is a key level to keep the rebound relevant. EURCHF struggles for support The euro bounced higher after the bloc’s industrial production beat expectations in September. The RSI’s oversold situation on the daily chart has attracted bargain hunters’ attention around 1.0530, a demand area from May 2020. Price action had three failed attempts to lift offers at 1.0600, a sign of strong selling pressure to keep the downtrend going. A bullish breakout may trigger a runaway rally as sellers seek to exit a crowded short bet. A bearish one would send the single currency to 1.0490. UK 100 tests support The FTSE 100 edged lower after active job postings in the UK hit a record high. The index came under pressure at the psychological level of 7400. A combination of an overbought RSI and its bearish divergence suggests that the rally was losing momentum. Sentiment remains upbeat and a pullback could be an opportunity to get filled at a better price. Trend followers may be waiting to buy the dip near the first support at 7315. A deeper correction would send the price to 7255 along the 30-day moving average.
Silver, the waiting game

Silver, the waiting game

Korbinian Koller Korbinian Koller 13.11.2021 19:25
Luckily, it is not necessary to time market entry and exit precisely. What is essential is calculating risk itself and that risk to expected returns. In addition, strict management of the trade itself is required. Gold versus Silver in US-Dollar, monthly chart, risk versus reward: Gold versus Silver in US-Dollar, monthly chart as of November 12th, 2021. That being said, instead of getting distracted by a narrative of policymakers who might prolong the inevitable even for years possibly, we focus on the technical aspects that cannot be “rationalized” away and will be unaffected by market influencers. One such fact is the market relationship between silver’s more giant brother gold. The chart above tries to illustrate that gold is trading 10% below its all-time high. On the other hand, silver is trading 50% below its all-time high. This discrepancy makes silver the more desirable play (better risk/reward-ratio). The difference will work like a loaded spring, and once released, silver will outperform gold by a multiple. Gold in US-Dollar, monthly chart, gold leading strongly: Gold in US-Dollar, monthly chart as of November 13th, 2021. Now that we have found the right vehicle for a wealth preservation insurance play, we are looking for additional factors. Physical acquisition is a clear prosperous choice. It protects against inflation and the risk possibilities inherent to fiat currency, with much historical evidence. That leaves us the question of entry timing. Especially since the physical purchase has a broader spread and a reactionary lag over spot price trading, which is pretty much instant. The chart above clarifies why we see there to be leeway regarding being “right.” It is less critical to pinpoint the absolute lows versus overall participation. Especially since a lack of physical silver availability, which is a possibility, would erase the whole play. The monthly gold chart above is a strong indication that precious metals might be breaking to the upside. With this month’s strength, price pushing against the upper resistance line (white line) of a bullish triangle, silver prices mutually trailing higher is likely. Silver in US-Dollar, monthly chart, closely following gold: Silver in US-Dollar, monthly chart as of November 13th, 2021. With these necessary positive edges in play, we can now look at silver itself and look for possible low-risk entry points.The monthly chart shows mutual strength over the previous gold chart. Silver has pushed successfully through the problematic distribution zone around the US$24 price level. It still faces POC (point of control), the highest volume node of our fractal analysis, looming above US$26.03. With this many edges in our favor, we find this an excellent spot to add to physical silver holdings from a long-term holding perspective. Silver in US-Dollar, weekly chart, spot price play: Silver in US-Dollar, weekly chart as of November 13th, 2021. For a spot price play in the midterm time horizon, we are instead waiting for a possible price bounce of POC. A low-risk entry would be granted once the price retraces back into the US$24 to US$24.50 zone. Reyna Silver encounters multiple high-grade sulphide zones within 54.9 metres of near-source style skarn at Guigui: Silver, the waiting game: In market movement, we see expansion and compression, much like an oscillator. At certain times though, may it be a natural or man-made disaster, we can find ourselves in a stretched or amplified move. These times of abnormality from a time perspective require being well-prepared. Swift, disciplined actions following a clear planned roadmap are advised. An anticipated roadmap strictly followed. It is first a waiting game followed by quick action, both psychologically challenging environments. With physical acquisitions of metals, perfectionism in timing is paralysis. Not necessary to come out ahead. We find silver accumulation at this time to be a prudent measure to protect your wealth. Like buying insurance against an anticipated market turn. 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. This article does 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.
XAUUSD (Gold) And XAGUSD (Silver) - A Technical Look

Gold 'n Silver 'n CPI Oh My!

Mark Mead Baillie Mark Mead Baillie 15.11.2021 09:26
The Gold Update by Mark Mead Baillie --- 626th Edition --- Monte-Carlo --- 13 November 2021 (published each Saturday) --- www.deMeadville.com  Let's start with October's Consumer Price Index (CPI) as reported by the U.S. Bureau of Labor Statistics: its excitedly-disseminated reading was +0.9% (which annualized is a whopping +10.8%). "Oh, 'tis the worst in 30 years!", they say. "Oh, 'tis the worst in 40 years!", some say. We say: "C'est très exagéré." Why? Because Labor has established this level -- or higher -- three times prior during the 24 years of our maintaining the Economic Barometer: for September 2005 'twas +1.2%; for June 2008 'twas +1.1%; and recently for this past June 'twas (as is now) a like +0.9%. Here's that history: Such exaggerative reporting of this October's +0.9% CPI growth arguably does have merit, for 'tis a very concerning rate of inflation. However as Grandpa Hugh would encourage today's news desks : "Get it first, but FIRST, get it RIGHT!" as opposed to the current-day media mantra of "Fake it FIRST, but fake it as FACT!" 'Course there are other sources that find far greater inflation; however in sticking with Labor's "official" measure, glaringly missing from the subsequent reportage is that -- following those three prior inflationary pops -- came cooling over at least the few ensuing months. 'Tis per the rightmost column of "next" three-month CPI average growth in the below table: Again, ours is not to belittle the seriousness of October's +0.9% CPI rise; rather 'tis to simply show it in the context of historical fact. Please notify a media outlet near you. Seriousness, indeed. For of further practical import (on the assumption that neither do you eat, nor use petroleum-based products), October's Core-CPI growth of +0.6% has already been realized four times just in the prior 15 months. Critical concern there, and justifiably so given the price of Oil has risen from 39.82 at mid-year 2020 to 83.22 at October 2021's settle (+109%). For from the "That's Scary Dept." the cumulative rise in the full CPI across that same 16-month-to-date stint is only +7.3% ... solely by that metric, folks have been gettin' off easy despite higher petrol prices! Fortunately, Gold and Silver may be FINALLY gettin' off their respective butts via their inflation mitigative role. Which obviously points to their having so much farther up to go. Per our opening Gold Scoreboard, price settled out the week yesterday (Friday) at 1868, its second-best single-week performance thus far this year on both a points (+47.7) and percentage (+2.6%) basis. Thus comparatively, 'tis a fine leap forward for Gold. However as you ad nausea already know, even in accounting for its supply increase, Gold by StateSide M2 currency debasement "ought" today be 3986. As well is the ever-annoying fact of Gold first hitting the present 1868 level a decade ago on 19 August 2011 when the money supply was just 44% of what 'tis today, ($9.457 trillion vs. $21.343 trillion). "Got Gold?" And as for Sweet Sister Silver, 'twas her third best weekly performance year-to-date, albeit settling yesterday at 25.41 is a price first achieved 11 years ago on 04 November 2010. "Got Silver?" (Oh and from the "Gold Plays No Currency Favourites Dept." the Dollar recorded its fifth best up week of the year. "Got Bucks?" We'd rather Swiss Francs). Moreover, from our always revered "The Trend is Your Friend Dept." as we saw a week ago, Gold's weekly parabolic trend -- after an intolerably lengthy stint as Short with little net price decline -- did flip to Long. And as is the rule rather than the exception, price this past week continued higher. Which begs your question: "How much does price rise when this happens, mmb?" Bang on cue there, Squire. And the answer is: across the 43 prior Long weekly parabolic trends since 2001, the median increase in the price of Gold is +8.3%. Thus by that number, from Gold's trend flip price back at 1820, an +8.3% increase this time 'round would bring us to 1971. Modest perhaps by valuation expectations, but a start. Too, some of you may recall this sentence from our 02 October missive wherein we nixed our year's forecast high of 2401: "...The more likely scenario shall well be Gold just sloshing around into year-end, trading during Q4 between 1668-1849..." Fab to already be wrong there! For here are the weekly bars and parabolic trends from this time a year ago-to-date: Now in the midst of all this inflation trepidation came Dow Jones Newswires this past week with "The Economic Rebound From Covid-19 Was Easy. Now Comes the Hard Part." Makes sense given everything having been shutdown last year. But: how bona fide actually is "Rebound"? Let's look at corporate earnings, (now yer not gonna get this anywhere else, so pay attention): with but a week to run in Q3 Earnings Season, most of the S&P 500 constituents that report within this calendar timeframe have so done, and with fairly admirable results: 80% bettered their bottom lines, (or as we said a week ago "better have bettered" given the economic shutdown of last year). Yet here's the dirty little secret: many mid-tier and smaller companies have also reported, by our count 1,368 of 'em. And of that bunch, we found just 56% of them did better. That is a Big Red Flag given mid-to-small businesses drive the American economy. We doubt your money manager knows that number. In addition to the past week's inflation reports, lost in the shuffle were the Econ Baro metrics showing September's Wholesale Inventories as backing up, whilst November's University of Michigan Sentiment Survey fell to a 10-year low, the 66.8 level not seen since November 2011. 'Course the S&P loving bad news, its Index roared upward to finish the week at 4683, a mere 36 points below its all-time high. Together with the Baro, here's the year-over year picture: Now to some impressive precious metals' technicals via our two-panel graphic of Gold's daily bars from three months ago-to-date on the left and those for Silver on the right. "Impressive" as when the falling baby blue dots of trend consistency reverse course back up without having dropped to mid-chart, the buyers are clearly in charge: As for the 10-day Market Profiles for Gold (below left) and Silver (below right), life is good at the top: Good as well is Gold's buoyant positioning within its stack: The Gold StackGold's Value per Dollar Debasement, (from our opening "Scoreboard"): 3986Gold’s All-Time Intra-Day High: 2089 (07 August 2020)Gold’s All-Time Closing High: 2075 (06 August 2020)2021's High: 1963 (06 January)The Gateway to 2000: 1900+10-Session directional range: up to 1871 (from 1759) = +112 points or +6.4%Trading Resistance: none per the ProfileGold Currently: 1868, (expected daily trading range ["EDTR"]: 25 points)Trading Support: Profile notables are 1864 / 1827 / 1793The 300-Day Moving Average: 1822 and falling10-Session “volume-weighted” average price magnet: 1816The Final Frontier: 1800-1900The Northern Front: 1800-1750On Maneuvers: 1750-1579The Weekly Parabolic Price to flip Short: 16862021's Low: 1673 (08 March) The Floor: 1579-1466Le Sous-sol: Sub-1466The Support Shelf: 1454-1434Base Camp: 1377The 1360s Double-Top: 1369 in Apr '18 preceded by 1362 in Sep '17Neverland: The Whiny 1290sThe Box: 1280-1240 Next week brings 14 metrics into the Econ Baro; consensus expectations look for it to turn higher. To be sure, turning higher have been Gold and Silver as inflation their prices stir; and yet their levels now 10 years on are the same as they were; thus their doubling from here can well be a blur! Cheers! ...m... www.deMeadville.com www.TheGoldUpdate.com
CPI Shocker Lifted the Greenback, which now needs to Take a Breath

CPI Shocker Lifted the Greenback, which now needs to Take a Breath

Marc Chandler Marc Chandler 15.11.2021 10:14
The jump in US headline CPI above 6% crossed some Rubicon and injected dynamic into the process.  The dollar rallied, and new highs for the year were recorded against the euro and sterling.  The dovish tapering announcement by the Fed on November 3 was completely unwound as the December 2022 Fed funds futures returned to the high-yield mark of 66 bp ahead of the weekend.   The two-year yield rose from about 39 bp at the start of the last week to almost 55 bp.  The volatility of the bond market (the equivalent of the VIX for the S&P 500) surged back to the year's high (above 78%).   Ultimately, the idea that R-star, the real short-term interest rate when the US economy is at full capacity and inflation stable, has continued to trend lower will likely cap nominal rates.  Equities wobbled, and the S&P 500 snapped an eight-day advance, and the NASDAQ's 11-day rally stalled.  US equities stabilized and posted modest gains in the past two sessions.   The rise in price pressures requires the Federal Reserve to be more flexible to address a range of possible outcomes.  The pace of the tapering is the main constraint on policy.  The FOMC statement committed the Fed to reduce the bond-buying by $15 bln in November and December.  While it anticipated that the pace would continue, it reserved the right to adjust the rate.  This is likely to be the focus in the run-up to the mid-December meeting.  To finish QE in March, as St. Louis Fed's Bullard, a noted hawk, has argued, the Fed would need to double its pace of tapering to $30 bln a month starting in January.  What is at stake is when the Fed's rate hike cycle can begin, not the terminal rate, which is expected to be below 2%.   Dollar Index:  The CPI saw the Dollar Index surge to convincingly surpass the (38.2%) retracement target of the decline from the March 2020 high (~103) to the January 6 low (~89.20).  That retracement (~94.55) had been penetrated briefly before, but it did not stick.  This time, the Dollar Index rose to new highs for the year, slightly above 95.25.  The next retracement (50%) is found a little above 96.00, and the (61.8%) objective is almost 97.75.   The momentum indicators suggest a high is not yet in place, but the move since the mid-week CPI shocker, above the upper Bollinger Band (~95.00) warns against chasing it.  That said, initial support is likely in the 94.60-94.75 area.   Euro:  The euro was driven below $1.15 after the US CPI report and failed to resurface above this previous floor, which now acts as resistance.  A low near $1.1435 was recorded ahead of the weekend.  Neither the MACD nor Slow Stochastic is over-extended, but, as we saw with the Dollar Index, the exchange rate is outside the Bollinger Band (slightly below $1.1465) and settled below it for the third consecutive session ahead of the weekend. There is little chart support until the $1.1290-$1.1300 area is approached.  Moreover, if the euro has carved out some kind of topping pattern, the risk may extend toward $1.10.   Japanese Yen:  From around mid-September through mid-October, the dollar broke out of the old JPY109-JPY111 range to reach JPY114.70 on October 20.  It consolidated at lower levels and approached JPY112.70 on November 9.  The jump in the US CPI reported the following day lifted the greenback to JPY114.00, and it reached JPY114.30 before the weekend.  We often experience the dollar-yen exchange rate as a pair often rangebound.  We had anticipated a JPY113-JPY115 range and would allow about a half a yen range or so violation. The MACD has flatlined, while the Slow Stochastic has turned higher.  Although the fit is not perfect, we still look at US yields for directional cues.   British Pound:  Sterling had been turned lower on November 4 from $1.37 by the BOE, who caught the market leaning too far over its skis, arguably encouraged to do so by official rhetoric.  Its attempt to recover was stalled near $1.36, and the US inflation jump set it to new lows for the year.  The low ahead of the weekend was slightly below $1.3355.  The MACD is entering oversold territory, while the Slow Stochastic, which leveled off, seems to be slipping into over-extended territory as well.  After closing for two sessions below the lower Bollinger Band, it finished the week back above it (~$1.3355).  A close above $1.3400 would suggest a consolidative phase lies ahead.  Last December, sterling recorded lows $1.3135-$1.3185, and the risk is for this area to be tested.   Canadian Dollar:  Since the US CPI surprise, the Canadian dollar has been the weakest of the major currencies, falling around 0.75% against the greenback.  It was the third consecutive weekly decline for the Loonie, which was preceded by a five-week advance.  The US dollar posted an outside up day in the middle of last week on the back of the CPI news.  It rallied from slightly below CAD1.2390 to a little above CAD1.25.  On Thursday, when US and Canadian banks were closed for holidays, the dollar rose to almost CAD1.2600 and made a marginal new high ahead of the weekend.  This met the (50%) retracement of the US dollar's decline since the CAD1.29 level was approached a couple of days before the September 22 FOMC meeting.  The Slow Stochastic is over-extended, though the MACD has more scope to run.  Here too, the market moved quickly, and the greenback settled the past two sessions above the Bollinger Band (~CAD1.2555). The CAD1.2480 area may offer initial support.   Australian Dollar:  The Australian dollar recorded the low for the year on August 20, near $0.7100.  It recovered into early September (~$0.7480) before being turned back to $0.7170 by the end of the month. The Aussie launched another advance last month that carried to around $0.7555 and the 200-day moving average.  It has come under new pressure this month and fell to nearly $0.7275 ahead of the weekend, meeting the (61.8%) retracement target of the overall rally since August 20.  It closed on a firm note above $0.7300.  The Slow Stochastic is over-extended and could turn up next week.  The MACD is still pointing lower.  After settling out the Bollinger Band on Wednesday and Thursday, the Aussie moved back into it (~$0.7300) ahead of the weekend.  Initial resistance is seen in the $0.7335-$0.7355 band.   Mexican Peso:  The US CPI boosted the dollar by nearly 1.6% against the peso, the most in five months.  It was the only advance of the week, but it was sufficient for the greenback to close around 0.6% stronger.  The high for the week (~MXN20.7225) was recorded in the hours after the central bank delivered its fourth quarter-point rate hike.  Banxico showed no appetite to increase the pace, unlike other regional central banks, even though CPI is still accelerating.  Still, the greenback slightly exceeded the (61.8%) retracement target (~MXN20.70) of its decline from the November 3 high (~MXN20.98) to the November 9 low (~MXN20.2515) before retreating ahead of the weekend.  Support is seen around the 20-day moving average (~MXN20.42).  Among emerging market currencies, the Brazilian real (~2.3%) and the Chilean peso (1.6%) fared best.  The Hungarian forint (~-2.9%) and the Turkish lira (-2.75) saw the largest losses.  The JP Morgan Emerging Market Currency Index fell by about 0.40% last week, the eighth weekly decline in the past ten.   Chinese Yuan:  One would not know it by reading much of the free financial press, but the Chinese yuan is the strongest currency in the world this year.  Its 2.3% advance eclipses the Canadian dollar, the only major currency stronger against the US dollar on the year (~1.3%).  The tensions in Europe and the pullback in oil prices saw the Russian rouble tumble almost 2.3% last week.  It was knocked from its perch as the top performer, allowing the yuan to pull ahead.  The dollar settled last week, slightly under CNY6.38, its lowest close since May 31, when it recorded a three-year low (~CNY6.3570).  The trend line connecting the 2014 dollar-low and 2018 low is frayed in May and June but essentially held.  It is now being violated more convincingly.   Sentiment toward investment in China has become in fashion again.  The NASDAQ Golden Dragon Index that tracks Chinese companies that trade in the US rallied nearly 7% last week.  China's 10-year yield of 2.80% may not sound particularly exciting, but it is the only benchmark that has not sold off this year.  The yield has fallen 20 bp.    Disclaimer
EURUSD shorts at first resistance at 1.1610/20 are working today

EURUSD shorts at first resistance at 1.1610/20 are working today

Jason Sen Jason Sen 03.11.2021 14:18
EURUSD shorts at first resistance at 1.1610/20 are working today USDCAD remains in a sideways range, good for scalping opportunities only as we hold first resistance again at 1.2420/40. Shorts stop above 1.2450. GBPCAD did not break lower but is holding around the low. Today's Analysis. EURUSD first resistance again at 1.1610/20. Shorts need stops above 1.1630. A break higher can target strong resistance at 1.1695/1.1705. Exit longs & try shorts with stops above 1.1720. A break higher is a buy signal targeting 1.1765/70 & 1.1800/10. Shorts at 1.1610/20 target 1.1580/75 (hit) perhaps as far as first support at the October low at 1.1530/20 today for profit taking. A break below 1.1510 is a sell signal initially targeting 1.1490 & although this could hold initially (a low for the day certainly possible but longs are risky) we eventually expected to target 1.1430/20. USDCAD first resistance again at 1.2420/40. Shorts stop above 1.2450. Be ready to buy a break above 1.2450 targeting 1.2510/30. Shorts at 1.2420/40 target 1.2370/65 (likely to pause here) then support at 1.2300/1.2280. Longs here need stops below 1.2270. A break lower is a sell signal. GBPCAD hits targets of 1.6950/40 & 1.6910/1.6890 for profit taking on shorts as finally we head for the target of 1.6870/60, perhaps as far as support at 1.6800/1.6780. First resistance at 1.680/90. Shorts need stops above 1.7010. We can try shorts again at 1.7050/70 but must stop above 1.7090. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
Oil holds steady as Biden considers releasing SPR

Oil holds steady as Biden considers releasing SPR

Walid Koudmani Walid Koudmani 15.11.2021 11:41
 Oil holds steady as Biden considers releasing SPR While oil prices have become exceedingly volatile in recent times after rising supply concerns and various production issues, prices have managed to stabilise with WTI hovering in the $80 range after retreating from a high of almost $85 reached last week. Meanwhile, calls on president Biden to release the country's strategic petroleum reserves (SPR) have mounted, as concerns for the rising price of gasoline has led many US politicians, including senate majority leader Schumer to pressure the president. This comes after OPEC decided once again to leave the rate of increase in production unchanged, despite oil prices having a significant impact on consumer activity and playing a significant part in the recent inflation discussions. While there is a lack of major data releases today, traders will be looking for any news relating to the supply of oil as an announcement by the US president could cause a short term immediate reaction for prices, while it's long term impact could ultimately be less significant.  Stock markets on edge after mixed Chinese data European indices have managed to start the day almost unchanged after a mostly positive Asian session, which saw the majority of stocks in the region gain slightly despite the mixed Chinese data. While Chinese industrial production increased 3.5% YoY in October (exp. 3.0% YoY) and retail sales were 4.9% YoY higher (exp. 3.5% YoY), urban investments increased only by 6.1% YoY (exp. 6.3% YoY) and showed the lowest daily steel output since December 2017 along with an alarming 17% drop in cement output, which is an important indicator for construction activity in the world's second largest economy. Investors could be more cautious heading into this week as several central bankers are expected to share their outlook on economic growth and as Wall Street earnings season nears its conclusion. Download our Mobile Trading App:   Google Play   App Store  
MSFT, Johnson&Johnson and More Companies With Reports to be Released shortly

Weekly S&P500 ChartStorm - 14 November 2021

Marc Chandler Marc Chandler 15.11.2021 11:20
The S&P500 ChartStorm is a selection of 10 charts which I hand pick from around the web and post on Twitter. The purpose of this post is to add extra color and commentary around the charts. The charts focus on the S&P500 (US equities); and the various forces and factors that influence the outlook - with the aim of bringing insight and perspective. Hope you enjoy! p.s. if you haven’t already, subscribe (free) to receive the ChartStorm direct to your inbox, so you don’t miss out on any charts (you never know which one could change the whole perspective!) Subscribe Now 1. Vacciversary: Can you believe, an entire year has passed since the Pfizer vaccine announcement. Markets had a strong immediate reaction, and since then have chalked up some 34% in gains. Of course a bunch of other factors are also at play, and we also had delta along the way, but you have to think at some level if there were no vaccine that the ride in markets might have been a little rougher. Source: @LarryAdamRJ 2. Investor Movement Index: The IMX moved down slightly in October - this continues the pattern of movement downwards from the peak in optimism of a few months ago. This is typically not a healthy sign for sentiment indicators i.e. reaching an extreme and then leveling off. Source: TD Ameritrade 3. Investment Manager Index: On the other hand, the Markit IMI rebounded further in November with risk appetite surging to multi-month highs and expected returns reaching a new (albeit short history - newish survey) high. Source: @IHSMarkitPMI 4. Euphoriameter: Even my own Euphoriameter composite sentiment indicator has ticked higher so far in November as valuations and bullish surveyed sentiment remain high and volatility lulls back towards complacency. Source: @topdowncharts 5. Investor Sentiment vs Consumer Sentiment: But not all sentiment indicators are at the highs: consumer sentiment has been decidedly less optimistic. I mentioned in a recent video that the UoM consumer sentiment indicator was perhaps overstating the extent of the decline, but the other 2 consumer confidence indicators I track for the USA have also started to drop off recently. This has left quite the divergence between consumer sentiment and investor sentiment. A large part of this is probably down to the inflationary shock that is currently facing the global economy due to pandemic disruption to the global supply chain *and* unprecedented monetary + fiscal stimulus (remember: supply shortages/backlogs and the associated inflation surge don’t exist if there is no demand —> demand has been boosted by stimulus —> and stimulus helps stocks ——> gap explained). Source: @takis2910 6. Real Earnings Yield: Another effect of the surge in inflation has been a plunge in the real earnings yield: again this can be squared up by noting that stimulus has been a key driver of the inflation shock and a key driver of the surge in asset prices —> surging asset prices (stock prices) leads to a lower nominal earnings yield (again: gap explained). So is this a problem? Perhaps, but one way or the other it will probably be transitory (if you can read between the lines a little there!!). Source: @LizAnnSonders 7. Valuations: Valuations rising = risks rising... but then again it's a bull market, so POLR is higher (for now). n.b. “POLR” = path of least resistance: basic notion that in markets and life when a force is set in motion an object will not change its motion/trajectory unless another force acts on it... That means a bull market will carry on until something changes e.g. a crisis, monetary policy tightening, recession, regulations/politics, (or a combination of all of those!). Source: @mark_ungewitter 8. Household Financial Asset Allocations: We all know by now that equity allocations by households is at/near record highs. But one surprise: cash holdings have jumped and are apparently on par with debt (bonds etc) ...even as cash rates suck (and are even suckier when you consider the real interest rate). Probably an element of booking gains, stimulus payments, and precautionary savings. Recall though: the job of cash is preservation of capital (and optionality) vs generating returns, as such. Source: @MikeZaccardi 9. S&P500 Constituents Return Distribution: I thought this was interesting - especially the tails of the distribution - a lot of heavy lifting being done at the tails. But also that ”s” — tails (i.e. big dispersion between left and right tails). Source: @spglobal via @bernardiniv68 10. The Five Biggest Stocks: The bigness of the biggest stocks in the index is biggening more bigly. Serious though: the market is increasingly lop-sided, this means diversification may be diminishing as systematic risk will be increasingly driven by specific risk. Source: @biancoresearch Thanks for following, I appreciate your interest! !! BONUS CHART: Leveraged ETF trading indicator >> Click through to the ChartStorm Substack to see the bonus chart section https://chartstorm.substack.com/p/weekly-s-and-p500-chartstorm-14-november Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
The Long and Short of Commodities

The Long and Short of Commodities

Topdown Charts Topdown Charts 03.11.2021 09:45
Commodities are up sharply this year, but several short-term indicators flash caution The medium-longer term bull case remains compelling The chart of commodities ex-gold versus gold offers clues to near-term price action Commodities are on pace for their best annual performance of the century. 2021 has not been a straight line higher, however. There was a period of consolidation during late Q2 through much of Q3. August through mid-October featured another explosive move higher, bringing the GSCI Light Energy index to its highest level in more than seven years. While we are long-term positive on the commodities space, there are mixed signals in the near-term. Breadth has deteriorated while the chart of commodities ex-gold versus gold has gotten extended after dropping to extremely cheap readings last year. It might be time for a pause. Featured Chart: Commodities Ex-Gold vs. Gold Comes Full Circle Sentiment & Positioning Have Soured Another feature that takes away from a positive near-term stance is a drop in bullish sentiment and traders’ positioning. The GSCI Light Energy Index’s consensus bulls reading was nearly two standard deviations above the long-term average at its Q2 peak. Today, the market is less frothy with consensus bulls sporting a Z-score under one. So, while prices have gone up, there is a negative sentiment divergence. Futures positioning shows a similar decoupling. There are fewer speculative net longs in commodities today versus the middle of the year. Excitement has dropped. Perhaps traders are losing interest in commodities as the supply disruption narrative (short-term spike) overshadows the supercycle narrative (longer term bull market). Long-term Upside Remains Likely So, while the near-term picture has turned less encouraging, we are still bullish long-term. Technically, the big breakout that took place a year ago remains alive. A similar breakout occurred in the early 2000s which led to a massive bull run, eventually taking the GSCI Light Energy Index from under 200 to 650. For perspective, the index finished October at 520 as it ventures back into the range from 2010 to mid-2014. Valuations remain compelling, too. Our Commodities Composite Valuation Indicator dropped nearly two standard deviations below its long-term average last year and has now recovered back to neutral. That suggests no barrier to higher prices based on a valuation argument despite the 46% year-on-year rally. The Supercycle May Be Just Beginning We assert the supercycle thesis is intact. The 10-year moving average of year-on-year returns (using the Refinitiv Equal-Weight Commodities Index) dipped negative in 2020—a dismal feat rarely seen in the EW commodities index’s 120-year history. While the 10-year moving average has crept higher in 2021, projections based on our Capital Market Assumptions dataset suggest further upside in the coming decade. Fundamental Factors Finally, a significant macro theme we’ve detailed this year is the dearth in commodities capex which endured a double-dip recession in 2020. While there are one-off supply disruptions in play, the bigger picture theme of extended underinvestment in commodity supply persists. A capex boom—driven by energy firms themselves, the green & EV movements, and increased public infrastructure investment—is likely, which is a source of demand for commodities. Bottom line: We took a bullish stance on commodities in March 2020 with a timeframe of 3-5 years. Our latest Weekly Macro Themes report reiterates the stance but reduces the conviction level based on some near-term mixed signals. The long-run bullish drivers are still there: underinvestment in supply, a robust capex outlook, and continued improvement in global demand for commodities. Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
The Greenback Slips at the Start the New Week

The Greenback Slips at the Start the New Week

Marc Chandler Marc Chandler 15.11.2021 12:19
Overview:  While the Belarus-Poland border remains an intense standoff, there have been a couple other diplomatic developments that may be exciting risk appetites today.  First, Biden and Xi will talk by phone later today.  Second, reports suggest the UK has toned down its rhetoric making progress on talks on the implementation of the Northern Ireland Protocol.  Equities in the Asia Pacific region were mostly firmer, with China a notable exception among the large markets, even though the October data was generally stronger than expected.  Europe's Stoxx 600, which has fallen only once this month, is edging higher to new records, while US futures are enjoying a firmer bias.  Benchmark 10-year yields are 1-2 bp lower, which puts the Treasury yield near 1.55%.  The European periphery is outperforming the core.  The dollar is soft.  The Scandis and Antipodeans lead the move, while the euro, yen, and British pound are little changed.  Emerging market currencies are also mostly stronger.  Here the Philippine peso is notable as it falls the most in seven weeks as corporates bought dollars.  After falling by 0.65% last week, the JP Morgan Emerging Market Currency Index is edging higher today.  Gold is snapping a seven-day rally, stalling near $1868.  Support is seen in the $1842-$1845 area.  January WTI  was sold again as it poked above $80.  It is pinned near last week's lows (~$78.65) as the US response is awaited.  European natural gas futures are firm as the capacity auction results are awaited, and Europe faces its first cold snap of the season.  Iron ore and copper prices are posting small losses.   Asia Pacific Japan's Q3 GDP disappointed, but it is old news and will likely spur Prime Minister Kishida to support a large supplemental budget, which could be unveiled by the end of the week.  Economic growth in the world's third-largest economy contracted for the fifth quarter in the past eight.  The 0.8% loss of output in Q3 was more than the 0.2% expected by the median forecast in Bloomberg's survey.  Consumption (-1.1%), business spending (-3.8%), and public investment (-1.5%) did the most damage.  The GDP deflator was unchanged from Q2 at -1.1%.  The Japanese economy is recovering here in Q4.  Talk of the size of the supplemental budget has increased to around JPY40 trillion (~$350 bln) from JPY30 trillion.  It is expected to include a cash payment for 18-year olds and younger, a tax break for companies that boost wages, a new subsidy for domestic travel, snd pay hikes for caregivers. China's October data was stronger than expected but does not shake off concern that the world's second-largest economy is struggling.  The year-over-year pace of retail sales rose for the second consecutive month in the face of expectations for a decline.  The 4.9% increase follows the 4.4% gain in September and 2.5% in August. In October 2020, it rose 4.3% year-over-year.  Industrial output rose 3.5% from a year ago. It was the first increase since March. Last October, it had increased by 6.9%. The surveyed joblessness was steady at 4.9%.  Fixed asset investment and property investment slowed.  Chinese officials have not addressed the economic slowdown with large-scale fiscal or monetary initiatives.   We have suggested that the dollar-yen exchange rate has entered a new range after trending higher from mid-September through mid-October.  That new range is likely JPY113-JPY115, and to find the floor, the dollar briefly traded below JPY112.80 last week. After spiking back to JPY114.00 on the US CPI surprise, the greenback continues to hover around there, the middle of the range.  Tomorrow's expiring options ($830 mln at JPY113.40 and $1.6 bln at JPY114.30) may mark the near-term range.  The Australian dollar is building on its pre-weekend recovery.  It saw a low slightly above $0.7275 on Friday and settled on its highs (a little above $0.7330).  It has risen to $0.7365, and the intraday momentum is getting stretched.  Look for resistance near $0.7375.  The greenback edged slightly lower against the Chinese yuan to record a new six-month low (~CNY6.3785) before recovering within a narrow range.  It is trading slightly above CNY6.3830 in late dealings. The PBOC set the dollar's reference rate at CNY6.3896, a little below the median forecast of CNY6.3896 (Bloomberg survey).  The PBOC rolled over in full the policy loans (CNY1 trillion) coming due this month, and the overnight repo rate fell by seven basis points to 1.78%, the lowest in three weeks.   Europe Tensions between the UK and EU appear to have taken a step away from the brink.  A deal on medicine supplies from other parts of Great Britain to Northern Ireland may have been the critical catalyst.  Reports suggest a de-escalation of UK rhetoric threatening to invoke Article 16, which allows for unilateral over-riding of the Northern Ireland Protocol under certain circumstances of serious economic, environmental, or societal risks.  Separately, two polls have begun showing Labour is edging ahead of the Tories. The Opinium poll (published in the Guardian) gave Labour a one percentage point lead, the first since January.  The Savanta Com Res poll (for the Daily Mail) put Labour ahead by six percentage points at 40%.  The main issue appears to be Prime Minister Johnson's handling of several ethics issues.  His personal support has also waned.    The US was warning at the end of last week that Russian may be preparing to invade Ukraine. Moscow seems to be acting out of fear, fear of the US and Europe creeping presence in Ukraine.  If Ukraine is going to remain independent, Russia insists it can only be a (weak) buffer state.  US rhetoric seemed aggressive in Moscow.  Last month US Defense Secretary Austin argued that no third country [i.e., Russia] has a veto over NATO membership decision[i.e., Ukraine].    Poland, Lithuania, and Latvia are considering formally requesting NATO consultations, while the EU is expected to announce new sanctions on Belarus later today.  Separately, we note reports that India has begun taking delivery of the S-400 air defense missile system from Russia (part of a $5.5 bln deal), which is the same that earned Turkey American sanctions.   The euro edged above the pre-weekend high, but the tone remains fragile, and for the third consecutive session has been unable to resurface above old support at $1.1500.  Since the US CPI report in the middle of last week, it has fallen, and the sideways movement could alleviate the overextended technical condition.  Sterling extended its pre-weekend recovery to reach $1.3440 before sellers reemerged to knock it to the session low of almost $1.3400.  We suspect it can move higher in North America today and target the $1.3480 area.   America The US seems more eager for the Biden-Xi call than Beijing  Expectations should be low, and with no actionable outcome likely (not even a statement), there appears to be little reason to spin it as a virtual summit. The top officials and the senior staff of the two largest economies should talk.  Previously, there were high-level meetings regularly.  Since their last call, a new US-UK-Australian alliance was announced that will result in Australia acquiring nuclear-powered submarines, and it was confirmed that the US has had military personnel in Taiwan since last November.  China continues with its intimidation campaign of repeatedly entering Taiwan's air-identification zone. China's assessment of the US is unlikely to have changed.  Beijing sees the same thing many others do.  Biden's approval rating has fallen to near 41%, and less than that has a favorable view of his handling of the economy.  At the end of last week, the Univerity of Michigan's consumer sentiment measure (preliminary November) fell to its lowest in a decade.  Surveys continue to point to the likelihood that the Democratic Party will lose both houses of Congress in next year's mid-term.  And to underscore the pressure on Biden, the US Court of Appeals (5th Circuit) sustained a block on OSHA's ordered vaccine mandate (or weekly test).  With the sixth plenum over,  Xi has, by all accounts, confirmed his ascendancy and domination of Chinese politics for years to come.   The week's economic calendar for the US begins off slowly.  The November Empire State manufacturing survey is on tap.  It has been in a sawtooth pattern, alternating between gains and losses for the past five months.  It fell sharply (19.8 from 34.3) in October and is expected to have turned up in November.  The US reports October retail sales and industrial production figures tomorrow. Fed officials begin taking to the public stage starting tomorrow.  Over the course of the week, around 11 officials are scheduled to speak.  In addition to US bills, the Treasury Dept sells 20-year bonds, whose auctions have been among the most challenging for coupons, and 10-year TIPS at the end of the week.   Canada reports September manufacturing and wholesale sales today, but the October existing home sales may be more important.  Tomorrow Canada reports housing starts, but the highlight of the week is Wednesday's October CPI.  Price pressures are accelerating in Canada, and the headline CPI is likely to move toward 5% (4.4% in September).  The swaps market is pricing in about 65 bp of tightening in six months.  This week, Mexico has a light economic diary after last week's higher than expected CPI (6.24%) and Banxcio's 25 bp rate hike (to 5%).  Brazil also has a light economic calendar this week.  Last week featured a further rise in (IPCA) CPI (10.67% vs. 10.25%) and weak September retail sales (-1.3% vs. -0.6% median forecast in Bloomberg's survey after a revised -4.3% fall in August). Last week's US CPI shocker saw the greenback jump from around CAD1.24 to slightly above CAD1.26, roughly the 50% retracement of the slump from CAD1.2900 on September 20.  It settled last week on a soft note, and some follow-through selling has seen the US dollar eased to about CAD1.2525.  A break here sees CAD1.2500 and then possibly CAD1.2470.  Since last September, the greenback has moved into a new and higher range against the Mexican peso.  It has not traded much below MN20.12.  Nor has it spent much time above MXN20.90.  It is in the pre-weekend range (~MXN20.45-MXN20.72).  Look for the consolidative day to continue through the local session.  The Brazil real was the strongest emerging market currency last week, rising almost 1.6% against the US dollar.  The US dollar found support around BRK5.40. Trendline support (from June, August, and September lows) and the 200-day moving average are near BRL5.36.   Disclaimer
S&P 500: More Short-Term Uncertainty As Trading Range Narrows

S&P 500: More Short-Term Uncertainty As Trading Range Narrows

Paul Rejczak Paul Rejczak 12.11.2021 17:18
The S&P 500 index went sideways on Thursday following a decline from its last week’s high. Is the downward correction over? For in-depth technical analysis of various stocks and a recap of today's Stock Trading Alert we encourage you to watch   The S&P 500 index gained 0.06% on Thursday, as it fluctuated along the 4,650 level. On Wednesday it fell to the local low of 4,630.86 and it was almost 88 points or 1.86% below the last week’s Friday’s record high of 4,718.50. The recent rally was not broad-based and it was driven by a handful of tech stocks like MSFT, NVDA, TSLA. The market seemed overbought in the short-term and traded within a topping pattern. Today the index may extend a short-term consolidation. The nearest important support level remains at 4,630-4,650 and the next support level is at 4,600. On the other hand, the resistance level is at 4,700-4,720. The S&P 500 broke below its steep short-term upward trend line, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Nasdaq’s Downward Correction Let’s take a look at the Nasdaq 100 chart. The technology index broke above the 16,000 level last week and on Friday it was trading at the new record high. The market accelerated higher above its short-term upward trend line. But since then it has been retracing the rally. The resistance level remains at 16,400, and the short-term support level is at 16,000, among others, as we can see on the daily chart: Apple Remains Relatively Weak, Microsoft Breaks Below the Trend Line Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple came back below the $150 price level. It is still well below the early September record high. Microsoft stock was reaching new record highs recently but on Wednesday it broke below its upward trend line. So the megacaps tech stocks turned lower, as we can see on their daily charts: Conclusion The S&P 500 index was little changed on Thursday and today it is expected to retrace some of its recent declines. So is the downward correction over? For now, there has been no confirmed short-term upward reversal and we may see some more consolidation below the 4,700 mark. The market may go sideways today, as investors keep taking short-term profits off the table following the recent economic and quarterly corporate earnings releases. Here’s the breakdown: The S&P 500 retraced some of its record-breaking rally in the last few trading sessions – for now it looks like a downward correction. Still no positions are 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 Strategist Sunshine 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.
Will You Allow Gold to Break Your Heart?

Will You Allow Gold to Break Your Heart?

Finance Press Release Finance Press Release 15.11.2021 15:46
Infatuated with gold? Many people are, but love affairs with commodities (or stocks) are dangerous. They’ll steal your heart, then dump you.Our critics often forget that we’re focusing on the medium-term outlook in precious metals, not intraday price moves. They’ll say “Look, gold moved up today. You were wrong Radomski.” That’s nice, but where will it be one or two months from now?While gold, silver, and mining stocks’ optimism resurfaced with a vengeance last week, the trio have broken plenty of hearts since peaking in August 2020. Thus, will the current rallies end in marriage or be another mirage?To begin, while the HUI Index/gold ratio invalidated the breakdown below its rising support line, a similar development occurred in 2013 and the downtrend still resumed.On top of that, I marked (with the shaded red boxes below) just how similar the current price action is to 2013. And back then, after a sharp decline was followed by a small corrective upswing before the plunge, the ratio’s current behavior mirrors its historical counterpart. Furthermore, the end of the corrective upswing in 2013 occurred right before the gold price sunk to its previous lows (marked with red vertical dashed lines in the middle of the chart below). Thus, the ratio is already sending ominous warnings about the PMs’ future path.Even more revealing, the ratio is dangerously close to its 200-day moving average. And when a similar development occurred in 2013 – with the ratio rising slightly above its 200-day moving average (marked with the red vertical dashed line below) – a sharp reversal occurred, mining stocks materially underperformed, and the ratio plunged.Please see below:Likewise, while the GDX ETF rallied again last week, I warned previously that a corrective upswing to $35 was a possibility (the senior miners reached this level intraday on Nov. 12). However, with the GDX ETF’s RSI (Relative Strength Index) signaling overbought conditions, the air should come out of the balloon sooner rather than later.Please see below:To explain, the GDX ETF rallied on huge volume on Nov. 11 and there were only 4 cases in the recent past when we saw something like that after a visible short-term rally.In EACH of those 4 cases, GDX was after a sharp daily rally.In EACH of those 4 cases, GDX-based RSI indicator (upper part of the chart above) was trading close to 70.The rallies that immediately preceded these 4 cases:The July 27, 2020 session was immediately preceded by a 29-trading-day rally that took the GDX about 42% higher. It was 7 trading days before the final top (about 24% of time).The November 5, 2020 session was immediately preceded by a 5- trading -day rally that took the GDX about 14%-15% higher (the high-volume day / the top). It was 1 trading day before the final top (20% of time).The January 4, 2021 session was immediately preceded by a 26-trading-day rally that took the GDX about 17%-18% higher (the high-volume day / the top). It was 1 trading day before the final top (about 4% of time).The May 17, 2021 session was immediately preceded by a 52-trading-day rally that took the GDX about 30% higher. It was 7 trading days before the final top (about 13% of time).So, as you can see, these sessions have even more in common than it seemed at first sight. The sessions formed soon before the final tops (4% - 24% of time of the preceding rally before the final top), but the prices didn’t move much higher compared to how much they had already rallied before the high-volume sessions.Consequently, since the history tends to rhyme, we can expect the GDX ETF to move a bit higher here, but not significantly so, and we can expect this extra move higher to take between an additional 0 and 7 trading days (based on the Nov. 12 session, so as of Nov. 15 it’s between 0 and 6 trading days).Why 0 – 6 trading days (as of today – Nov. 15)? Because with the 4% timeline now in the rearview, the latter represents the updated 24% timeline based on the preceding rally (that took 30 trading days).Since it’s unlikely to take the mining stocks much higher, and the reversal could take place as soon as today (also in gold and silver price), I don’t think that making adjustments to the current short positions in the mining stocks is justified from the risk to reward point of view.Is there a meaningful resistance level that would be likely to trigger a decline in mining stocks? Yes! The GDX ETF is just below its 38.2% Fibonacci retracement level based on the August 2020 – September 2021 decline. The resistance is slightly above $35, so that’s when the final top could form.As for the GDXJ ETF, the gold junior miners have already hit their 38.2% Fibonacci retracement level (potential resistance) and the top may be upon us. Moreover, when the GDXJ ETF’s RSI increased above (or near) 70 in mid-2020 and in mid-2021, sharp drawdowns followed.As a result, those historical readings provided us with great shorting opportunities.In conclusion, investors have fallen in love with gold, silver, and mining stocks once again. However, when it comes time for matrimony, the precious metals often leave investors at the altar. As a result, while we remain bullish on gold, silver, and mining stocks’ long-term prospects, timing is important. And while the recent upswings may seem like the beginning of a new bull market, several reliable indicators beg to differ. Thus, caution is warranted, and new lows will likely materialize over the medium term.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.
Getting Real on PMs and Inflation

Getting Real on PMs and Inflation

Monica Kingsley Monica Kingsley 15.11.2021 15:47
S&P 500 indeed rose but bond markets couldn‘t keep the encouraging opening gains. Can stocks still continue rallying? They look to be setting up for one more downleg of maximum the immediately predecing magnitude, which means not a huge setback. The medium-term path of least resistance remains up – the Fed is still printing a huge amount of money on a monthly basis, and it remains questionable how far in tapering plans execution they would actually get – I see the risks to the real economy coupled with persistently high inflation as rising since the 2Q 2022 (if not since Mar already, but most pronounced in 2H 2022).Stocks are still set for a good Dec and beyond performance – just look at VIX calming down again. It‘s that the debt ceiling drama resolution would allow the Treasury to start issuing fresh debt, and that would weigh heavily on the dollar. That‘s a good part of what gold and silver are sniffing out, and if you look at the great white metal‘s performance, it‘s the result of inflation coming back to the fore as the Fed itself is now admitting to high inflation rates through the mid-2022, putting blame on supply chain bottlenecks. Oh, sure. The real trouble is that inflation expectations are starting to get anchored – people are expecting these rates to be not going away any time soon.Precious metals are going to do great, and keep scoring excellent gains. Surpassing $1,950 isn‘t out of the realm of possibilities, but I prefer to be possitioned aggressively while having more conservative expectations. Not missing a dime this way. Copper is awakening too, and commodities including oil would be doing marvels. If in doubt, look at cryptos, how shallow the corrections there are.A few more words on yields – as more fresh Treasury issued debt enters the markets, look for yields to rise. Coming full circle to stocks and my Friday‘s expectations:(…) TLT though is having trouble declining further, and that means a brief upswing carrying over into stocks, is likely.TLT downswings would be less and less conducive to growth, so if you‘re still heavily in tech, I would start eyeing more value.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 bulls are on the move, and let‘s see how far they make it before running into another (mild, again I say) setback.Credit MarketsCredit markets opening strength fizzled out, but the weakness is getting long in the tooth kind of. I view it as a short-term non-confirmation of the S&P 500 upswing only.Gold, Silver and MinersGold and silver are on a tear, and rightfully so – I am looking for further gains as both gold and silver miners confirm, and the macroeconomic environment is superb for PMs.Crude OilCrude oil bulls keep defending the $80 level, with $78 serving as the next stop if need be – after Friday, its test is looking as an increasingly remote possibility – the two lower knots in a series say. Anyway, black gold will overcome $85 before too long.CopperCopper ran while commodities paused – that‘s a very bullish sign, for both base and precious metals. The lower volume isn‘t necessarily a warning sign.Bitcoin and EthereumBitcoin and Ethereum are still consolidating, and the relatively tight price range keeps favoring the bulls – and they‘re peeking higher already.SummaryS&P 500 bulls are holding the short-term upper hand, but the rally may run into headwinds shortly. Still, we‘re looking at a trading range followed by fresh highs as a worst case scenario. Yes, I remain a stock market bull, not expecting a serious setback till probably the third month of 2022. Precious metals are my top pick, followed by copper – and I am definitely not writing off oil, let alone cryptos. Inflation trades are simply back!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.
Intraday Market Analysis – Gold Approaches Supply Zone

Intraday Market Analysis – Gold Approaches Supply Zone

John Benjamin John Benjamin 16.11.2021 09:28
XAUUSD tests trendlineGold continues on its way up as investors seek to hedge against inflationary pressures. The rally picked up steam after a break above the triple top at 1833. Price action is grinding up along a rising trendline.The bulls are pushing towards 1884, a major resistance where last June’s sell-off started. Strong selling pressure is possible in that supply zone as short-term buyers may take profit and reassess the directional bias.1855 on the trendline is the first support. A bearish breakout may trigger a correction to 1823.AUDUSD breaks above bearish channelThe Australian dollar softened after the RBA minutes reiterated that there will be no rate hike until 2024.The pair has found buying interest at the base of October’s bullish breakout (0.7280). A break above the falling channel indicates that sentiment could be turning around.0.7390 is a key resistance and its breach could prompt sellers to bail out. In turn, this would raise volatility in the process. Traders may then switch sides in anticipation of a reversal. An overbought RSI has so far limited the upside impetus.GER 40 rally gains tractionThe Dax 40 climbed after upbeat retail sales and industrial production in China lifted market sentiment.The index is seeking to consolidate its recent gains after it cleared the previous peak at 15990 which has now turned into support. Sentiment remains optimistic and 16300 would be the next step.An overbought RSI on the daily chart may temporarily put the brakes on the bullish fever. But a pullback may once again attract a ‘buying-the-dips’ crowd above 15990. A deeper correction may send the price towards 15770.
UK Unemployment figures improve ahead of BoE decision

UK Unemployment figures improve ahead of BoE decision

Walid Koudmani Walid Koudmani 16.11.2021 12:06
UK Unemployment figures improve ahead of BoE decision Today's positive unemployment figures continue the recent trend which has seen unemployment fall for several months in a row and reach the lowest level in 2021. This paints a slightly brighter picture for the economy as many businesses contend with rising prices, labour shortages and supply chain issues and could be used by the Bank of England to justify adjusting monetary policy after unexpectedly leaving it unchanged in its most recent meeting.  Crypto market in the red after US infrastructure bill passes  After several days of gains, which saw Bitcoin hover near it's all time high as many other altcoins managed to reach new highs, we are seeing a significant pullback in the crypto market today with most tokens down over 10% and BTC trading around $60,000. This comes after news that China will be intensifying the repression of crypto currency mining by imposing punitive electricity prices on households that mine crypto. Furthermore, US president Biden signed the $550 Billion infrastructure deal which includes some major tax implications for most retail crypto investors as it would require them to report their holdings. While these factors may frighten some investors and newcomers to the market, some experienced traders will have seen similar sized corrections in the past and could potentially be eyeing opportunities as mainstream adoption of cryptocurrencies and NFT's continues to move further. On the other hand, the extreme volatility that the market is prone to could lead to a potential domino effect if more negative news were to emerge and take prices to new lows. Download our Mobile Trading App:   Google Play   App Store  
Technical Analysis - Support And Resistance - Terms You Should Know

Key event risk and front of mind this week...

Chris Weston Chris Weston 16.11.2021 12:15
UK jobless claims (Tuesday 18:00 AEDT) and Oct CPI (Wed 18:00 AEDT) New home prices (today at 12:30 AEDT), Retail sales, industrial production, fixed-asset investment, property investment (all today 13:00 aedt) Aussie Q3 wage data (Wed 11:30 AEDT) RBA gov Lowe speaks (Tues 13:30 AEDT) US retail sales (Wed 00:30 AEDT), Fed speeches all week with the highlight vice-chair Clarida (Sat 04:15 AEDT) The inflation debate is still the hottest ticket in town – it is promoting higher volatility (vol) in rates markets and bonds, with a small pick-up seen in FX volatility (vol). Equity markets are still, however, calm, with the VIX at 16.3% with falling demand to hedge potential drawdown. This divergence in implied vol across asset class remains a key talking point, but there is no doubt that the boat is not yet tipping with correlations among stocks almost at zero, and cyclical sectors (of the S&P500) still holding up well vs defensives. If the US high yield credit spread accelerated above 273bp above the US 10yr Treasury (currently 267bp), then again, I think equities would be a better sell.  Now this dynamic may change, especially if the debt ceiling comes into play in mid-Dec…but what are the signs to look for over a medium-term?  A higher vol regime will make conditions far more prosperous for equity short-sellers and change the dynamics in FX markets, with renewed downside demand for high beta FX (AUD, NZD, CAD, and MXN). The USD will turn from one being driven by pro-cyclical forces – i.e. relative economics and rate settings - to one sought for safe-haven demand, with the JPY also benefiting.  (Implied volatility benchmarks across asset class) Firstly, I would start with the rates markets – we can see a bit over 2 hikes priced into US fed funds future by the end-2022, with rates ‘lift off’ starting in July. I think if we priced in over 3 hikes in 2022 it could become more problematic for risk assets. Looking out the Eurodollar rates curve, we see a reasonably aggressive pace of hikes in 2022 and 2023, but then the pace markedly declines with barely anything priced for 2024 and 2025. In essence, the market sees hikes as front-loaded suggesting the Fed are in fact not dramatically behind the curve – a factor that is one of the core debates in macro.  We see an 89bp differential between the Eurodollar Dec 2025 and Dec 2022 futures contracts – if this moves back to say 140bp then this could be the market feeling that inflation is going to be a far greater problem and rate hikes are being more aggressively priced throughout the next four years. (Orange – US 5y5y forward rate, white – Fed’s long-term dot plot projection) Also, if the US 5y5y forward rate (the markets view on the ‘terminal’ fed funds rate – now 1.94%) pushed above 2.50% (the Fed’s long-term dot plot projection), again, I think this would be a trigger for far higher volatility and risk aversion.  A move to 2.50% won't play out overnight, if at all, and we’ll need to see real evidence that the US labour force participation rate is not going above 62%, while unit labour costs stay elevated and supply chains heal at a glacial pace. However, if the forward rate was eyeing 2.5% I think this could be a factor many strategists will point to for the VIX to sustain a move above 20%. The gold market is perhaps one of the more classic signs of inflationary concerns – this is a play on US ‘real’ (adjusted for inflation expectations) rates though, where the combination of a better economy in Q4, record negative US real rates and rising inflation is one the gold bulls will seek out precious metals. The Fed may need to promote a move higher in real rates, but the knock-on effect is they risk the stock market finding sellers – notably in growth stocks. A downside break of -2% in 5yr US real Treasury’s could be the trigger for gold to push into and above $1900.  Many debate the linkage between inflation expectations and the real economy. I’m not sure it matters when people are feeling the effects for themselves, and much has been made of the recent NFIB small business survey and Friday’s University of Michigan consumer sentiment survey, which hit the lowest levels since August 2011.  Clearly inflation is not popular and is increasingly the key political issue – I’d argue if real rates break to new lows this could accelerate inflation hedges, while a move through 2.7% in US 5y5y inflation swaps (currently 2.55%) would also play into the idea that perhaps the Fed, at the very least, need to radically reduce the pace of QE in the December FOMC meeting.  Clearly, the US Nov CPI (released 11 Dec) is going to be a big event for markets to digest and the signs are price pressures will continue to build from the current 6.2% YoY pace.  Crude and gasoline also play a key role in shaping sentiment – Senate Majority Leader Schumer has called on President Biden to release an element of the US’s Strategic Petroleum Reserves (SPR). This is a factor that has been talked up since OPEC rejected the US’s calls to increase output by more than 400k barrels. However, the introduction of Schumer into the mix just adds fuel to the fire and this may weigh on crude. So, a few indictors I am watching that could spur the market into a belief the Fed are genuinely behind the curve – I’d argue the market isn’t there yet, but if the factors I mention don’t show evidence of dissipating then we could see forward rates move to levels that could highlight the Fed need to act far more intently – that is where risk dynamics could markedly change.
Bitcoin strongly supported

Bitcoin strongly supported

Jason Sen Jason Sen 16.11.2021 12:23
Bitcoin dipped to strong support at 62000/61500 with a bounce 250 ticks above Ripple has stabilised after the bearish engulfing candle on Wednesday. We held first support at 12100/12050 for a more positive outlook this week. Ethereum consolidates after the bearish engulfing candle so we are trading sideways in what is probably a bull flag. Update daily at 07:00 GMT Today's Analysis Bitcoin outlook is more positive now we have held strong support at 62000/61500. If we can now hold above 64500 we can target 66000/66500 then retest 68000/68500. A break higher is a buy signal. Best support at 62000/61500. I would try longs with stops below 60000. A break below 59000 is an important sell signal. Ripple minor resistance at 12050/12100. A break higher targets 12600/12650. We should struggle here initially but a break higher eventually targets 12900/13000. Above here look for 13330/13380 before a retest of the recent high at 13450/13500. Strong support at 11300/200. A break below 10150 however is a sell signal targeting 10750. Ethereum minor resistance at 4700/50 this time. Further gains meet strong resistance at 4830/4860. Obviously a break above the all time high puts bulls back in the driving seat over this week initially targeting 4940/50 then 5165/85. First support at 4550/4500. Longs need stops below 4450. A break lower is an important sell signal for today targeting 4350/30. A low for the day is likely. Longs need stops below 4300. A break below here is a more serious sell signal, initially targeting 4170/50 but 4050/4000 is certainly possible. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
Stocks to Open Higher but Another Profit-taking Action is Likely

Stocks to Open Higher but Another Profit-taking Action is Likely

Paul Rejczak Paul Rejczak 15.11.2021 15:51
  Stocks retraced some of their recent declines on Friday and the S&P 500 index is expected to open higher this morning. So is the downward correction over? The S&P 500 index gained 0.72% on Friday, Nov. 12, as investor sentiment turned bullish and the market bounced from the support level of around 4,650. On Wednesday it fell to the local low of 4,630.86 and it was almost 88 points or 1.86% below the previous week’s Friday’s record high of 4,718.50. The recent rally was not broad-based and it was driven by a handful of tech stocks like MSFT, NVDA, TSLA. The market seemed overbought in the short-term and traded within a topping pattern. But today the index may get back to the 4,700 level. The nearest important support level remains at 4,630-4,650 and the next support level is at 4,600. On the other hand, the resistance level is at 4,700-4,720. The S&P 500 broke below its steep short-term upward trend line recently, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Nasdaq Bounced From the 16,000 Level Let’s take a look at the Nasdaq 100 chart. In the previous week the technology index broke above the 16,000 level and it was trading at the new record high. The market accelerated higher above its short-term upward trend line. But since then it has been retracing the rally. On Friday the index retraced some of the recent declines, however it remained below its short-term local lows, as we can see on the daily chart: Apple Is Still Close to $150, Microsoft Remains Relatively Strong Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple continues to fluctuate along the $150 price level. It is still well below the early September record high. Microsoft stock was reaching new record highs recently but last week it broke below its upward trend line. So those two big cap tech stocks remain mixed, as we can see on their daily charts: Conclusion The S&P 500 index retraced some of its recent declines on Friday and today it is expected to open 0.4% higher. So it looks like a downward correction is over and the market may reach new highs or at least extend a short-term consolidation along the 4,700 level. Investors will wait for tomorrow’s Retail Sales number release and some Fed-talk later in the week. Here’s the breakdown: The S&P 500 is expected to extend its Friday’s advance this morning and it may get to the 4,700 level. Still no positions are 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.
The Top 5 Companies Added to Our Stock Market Watchlist this Quarter

The Top 5 Companies Added to Our Stock Market Watchlist this Quarter

Invest Macro Invest Macro 16.11.2021 12:10
https://investmacro.com/2021/11/the-top-5-companies-added-to-our-stock-market-watchlist-this-quarter/ Body: By InvestMacro The fourth quarter of 2021 is approximately halfway over and we wanted to highlight some of the top companies that have been analyzed by our QuantStock system so far. The QuantStock system is an algorithm that examines each company’s fundamental metrics, earnings trends and overall strength trends 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 system does not take into consideration the stock price so one must compare each idea with their current stock prices. Many studies are consistently showing overvalued markets and that has to be taken into consideration with any stock market idea. As with all investment ideas, past performance does not guarantee future results. Here we go with 5 of our Top Stocks halfway through Quarter 4 of 2021: Gilead Sciences Inc. Health Care, Large Cap, 4.29% Dividend, Our Grade = A Gilead Sciences Inc. (NASDAQ: GILD) is first up and is a company engaged in developing innovative therapies for life-threatening diseases. Its medicine portfolio includes treatment for conditions ranging from HIV and hepatitis to coronavirus and cardiovascular disorders. If we talk about its financial performance, the bio-pharmaceutical company recently crushed expectations for the third quarter. It posted adjusted earnings of $2.65 per share on revenue of $7.42 billion for the quarter ended September 30. The results easily beat the consensus forecast of $1.76 per share for earnings and $6.29 billion for revenue. If we look at its key financial metrics, Gilead stock is currently trading around $67.48 against its 52-week range of $56.56 – $73.34. Moreover, its P/E value is 11.55, while the company’s total market value is just over $84 billion.   US Steel Materials, Small Cap, 0.77% Dividend, Our Grade = A- United States Steel Corporation (NYSE: X), founded in 1901, is one of the leading steel producers in the U.S. The strong demand for steel helped the company post better-than-expected financial results for the third quarter. United States Steel reported adjusted earnings of $5.36 per share for the three months ended September 30, beating expectations of $4.85 per share. Quarterly revenue of $5.96 billion also surpassed the consensus forecast of $5.79 billion. If we look at the recent price movement, United States Steel stock has gained more than 50 percent value so far in 2021. The 52-week range of the stock is $10.72 – $30.57, while the total market value of the company is approx. $7 billion.   Seagate Technology Information Technology, Medium Cap, 3.18% Dividend, Our Grade = A- Seagate Technology Holdings plc (NASDAQ: STX) is one of the world’s biggest hard disk drives (HDDs) makers. It still generates a large portion of its revenue by selling traditional HDDs. The company last month announced better-than-expected financial results for its fiscal first quarter, driven by solid demand from cloud data center clients. Seagate reported adjusted earnings of $2.35 per share on revenue of $3.12 billion for the three months ended October 1, while analysts were looking for earnings of $2.21 per share on revenue of $3.11 billion. The impressive financial performance drove Seagate stock higher in recent weeks. Seagate stock is now up nearly 80 percent on a year-to-date basis.   Synchrony Financial Financials, Medium Cap, 1.68% Dividend, Our Grade = A- Synchrony Financial (NYSE: SYF) has vast experience in the financial sector. It is one of the biggest credit card issuers in the U.S., working with hundreds of retailers to support their credit card plans. The company last month announced a solid profit for the third quarter. Synchrony reported earnings of $2 per share, significantly higher than 52 cents per share in the comparable period of 2020 and better than the consensus forecast of $1.52 per share. If we see its recent price trend, Synchrony has grown its value at a decent pace so far in 2021. The company’s share price has increased about 47 percent on a year-to-date basis. The 52-week range of the stock is $29.32 – $52.49, while its P/E ratio stands at 7.10.   Lazard Ltd Financials, Small Cap, 3.98% Dividend, Our Grade = A- Lazard Ltd (NYSE: LAZ) specializes in financial advisory and asset management services. It mainly advises clients on mergers and acquisitions (M&A), capital structure, and restructuring plans. It has advised on some of the biggest and most complicated M&A deals of the last century. If we look at its financial performance, Lazard posted mixed results for the third quarter. Its earnings of 98 cents per share exceeded the expectations of 95 cents per share. However, the quarterly revenue of $702 million missed analysts’ average estimate of $715 million. Lazard stock traded mostly lower following the results. Nevertheless, the company’s share price is still up nearly 15 percent on a year-to-date basis. -------------------------------------------------------------------------------------------------- By InvestMacro – Be sure to join our stock market newsletter to get our updates and to see more top companies. All information, stock ideas and opinions on this website are for general informational purposes only and do not constitute investment advice.
Biden-Xi "Summit" Leaves Markets Unmolested, While Bailey Continues to Blame Investors for Misunderstanding Him

Biden-Xi "Summit" Leaves Markets Unmolested, While Bailey Continues to Blame Investors for Misunderstanding Him

Marc Chandler Marc Chandler 16.11.2021 14:03
Overview: The much-heralded Biden-Xi meeting left little impression on the capital markets.  Equities in the region were mixed, and China's main markets fell, alongside Australia, South Korea, and India.  European equities continue their upward market, with the Stoxx 600 gaining for a fifth consecutive session. US futures are softer.  The bond market is quiet, with the US 10-year yield softer slightly below 1.60%.  European benchmark yields are 1-2 bp lower and the periphery is outperforming the core.  Encouraged by a strong employment report, sterling is the strongest of the majors, gaining about a third of one percent.  Most major currencies are trading with a heavier bias, and the euro is pinned near 19-month lows.  The dollar is gaining against most emerging market currencies.  The Turkish lira is off more than 1.5% as the market prices in a 100 bp cut on Thursday.   Hungary's disappointing Q3 GDP (0.7% vs. 1.0% forecasts) may limit the aggressiveness of the central bank today.  A 30 bp hike after two 15 bp moves was expected.  Gold is extending its rally and has taken out the downtrend drawn off the January and June highs (found ~$1872 today).  The next target is around $1900.  Oil is firm, and the January WTI contract is straddling the $80-level.  European natural gas is rising as new supplies are low, and there is a further delay in the certification process of the Nord Stream 2 pipeline.   Yesterday's 9% advance has been extended by another 8% today.  Iron ore has steadied, while copper is struggling after falling 1% yesterday.   Asia Pacific There is not much to say about the Xi-Biden "virtual summit."  The call reportedly lasted three hours.  The one concrete thing to emerge is that US business executives will have an easier/quicker time entering China.  Separately, Hong Kong's Chief Executive used her regular briefing to justify the decision to allow JP Morgan's CEO to skip the city's 21-day hotel quarantine because of the size of the bank's operations.  This speaks to the difference between the rule of law and the rule by law that some observers make.  Returning to regular meetings between the senior officials from both countries seems to be the logical way forward, but both sides appear to draw domestic benefits from demonizing the other.  In the US, the Biden administration uses the threat of China to justify building a 21st-century infrastructure. At the same time, Beijing plays the nationalistic chords to strengthen the loyalty to the Communist Party even as its delivery of improved living standards slows or stalls.   The minutes from the recent Reserve Bank of Australia meeting contained no surprises.  The exit from the yield curve control policy seems clumsy, but the RBA seems adamant that a rate hike next year is unwarranted.  The market remains convinced officials are wrong.  The swaps market has about 75 bp discounted over the next 12 months, with the hikes and risks increasing beginning in late H1 22. In a speech after the minutes were released, Governor Lowe referred to a hike in 2024 as "still plausible," but this seemed like a slight climb down from it being the "central case."  On the other hand, elevated price pressures and border controls have driven the unemployment rate to 3.4%, its lowest level since 2008, and lifted the participating rate to match record highs. The Reserve Bank of New Zealand will likely hike rates again next week.  The swaps market is pricing in nearly 50 bp of tightening by the RBNZ over the next three months and almost 140 bp in the following nine months.  It is difficult to see a more hawkish outlook.  The five basis point jump in the US 10-year yield helped lift the greenback to JPY114.30, matching its best level since November 1 (JPY114.45).  There is an option for $1.6 bln at JPY114.30 that expires today.   The four-year high was set on October 20 near JPY114.70.  The Japanese economy is recovering after a larger than expected contraction in Q3.  A large supplemental budget is expected as early as the end of the week but before month-end in any event.  As if confirming the lack of new insight from the RBA minutes, the Australian dollar is trading within yesterday's range (~$0.7320-$0.7370).  A break of the $0.7300 area would weaken the technical tone, while a move above $0.7380 signals a stronger recovery after finishing last month near $0.7550.  The Chinese yuan rose to new five-month highs today before pulling back.  The dollar fell to CNY6.3670 and rebounded to a new session high slightly above yesterday's high near CNY6.3850.  The PBOC set the dollar's reference rate at CNY6.3924, a little above the (Bloomberg survey) median projection of CNY6.3920. Ironically, the yuan's high was recorded as the Biden-Xi call got underway.  It trended lower through the rest of the session.   Separately, the PBOC boosted its liquidity injection via seven-day repos to CNY50 bln from CNY10 bln on Monday and rolled off its full medium-term lending yesterday, easing technical pressure in the money market.   Europe The UK's employment data is especially important in light of the BOE concerns about the labor market now that the furlough program has ended.  Around one million workers were on the program when it ended. The BOE surprised the market by not raising rates at the meeting earlier this month. Governor Bailey continues to blame the market for misconstruing his remarks and expressing his unease with the "inflation situation."  He said he wanted to see what happens now that the furlough program ended before hiking, but it is not clear that today's data is sufficient.  However, the preliminary indications suggest the UK labor market is normalizing quickly.  October payrolls rose by 160k. Jobless claims fell by nearly 15k after a revised decline of almost 86k in September (initially estimated at -51.1k).  In the three months through September, the UK employment rose by 247k, and the ILO measure of unemployment fell to 4.3% from 4.5%.  Of note, the next employment report will be issued two days before the next MPC meeting (December 16).     Governor Bailey acknowledged that his decision not to hike rates earlier this month was close.  The swaps market has a little more than a 55% chance of a hike in December and has it fully priced it in for the first meeting next year (February 3). The central bank's chief economist, Pill, said there was no evidence yet that higher inflation was seeping into general pay levels.  Starting salaries appear to be increasing, but it may not be lifting the pay for existing workers.  Separately, a technical glitch with an internet-based order system caused the BOE to postpone a bond purchases operation until Thursday.  The QE operations take place three times a week at a pace of slightly more than GBP3 bln a week, with an eye toward finishing them by year-end.   There is another twist to the saga of the controversial Nord Stream 2 pipeline.  Hopes that the completed pipeline could become operational soon were dealt a fresh blow by the German regulator, who suspended the certification process.  The technical issue was a change in the legal form of the operating company.  Nord Stream 2 AG established a subsidiary that would own and operator the German section of the pipeline.  There is some thought that after this delay, the corporate reorganization could expedite the eventual approval.   Coronavirus deaths spiked in Germany to the six-month highs, and the government is debating how to control the fourth pandemic wave. Ironically, Japan now has the highest inoculation rates among the G7. It reported the lowest number of new infections in 18 months. The euro was sold below $1.1400 yesterday and has been unable to resurface above there.  Since the $1.15 level broke, we have suggested the next target is near $1.1290-$1.1300. The ECB's dovish rhetoric contrasts with the prospect of a more hawkish posture by the Federal Reserve.   We continue to see an acceleration of the Fed's tapering as the most likely outcome of the December FOMC meeting, while next month's ECB meeting is more about extending the bond-buying after the Pandemic Emergency Purchases Program ends next March.  The prospects of a rate hike next month lifted sterling to four-day highs near $1.3475, but there does not look like there is the interest to test the $1.35 area, which holds a GBP407 mln option that expires today.  Initial support is now seen in the $1.3400-$1.3420 area. The euro is sliding for the third consecutive session against steering and looks poised to test the year's low near GBP0.8400 in the coming days. The UK reports October CPI figures tomorrow, and they are expected to have accelerated.    America The US economic growth is improving this quarter after the disappointing 2% annualized pace in Q3.  It will be reflected in the consumption and production data.  Today sees October retail sales, a little more than 40% of overall consumption, and industrial production, including factories and utilities, mining, and drilling.  Headline retail sales will likely be lifted by the first increase in auto sales in six months.  The core components, which exclude autos, gasoline, building materials, and food services, are forecast (Bloomberg, median) to rise a solid 0.9%.  It would be the third consecutive monthly gain, the first since Q3 20.  Consumer spending rose 2% at an annualized rate in Q3 and is expected to grow closer to 5% this year, having peaked in Q2 at 6.7%.  Industrial production fell in August and September but is expected to have snapped back in October as the recovery from Hurricane Ida took hold.  The median forecast (Bloomberg survey) is for a 0.8% gain.  The rig count rose by 23, matching the most since January.  According to the recent jobs report, manufacturing employment rose by 60k in October.  Few have noted it, but if confirmed, it would be the largest monthly increase since August 1998.  That said, the Markit manufacturing PMI and ISM manufacturing index fell.   The Biden administration's $1.75 trillion "Build Back Better" bill is in the balance.  Some argue that the surge in inflation has been spurred by the government's spending and transfer payments and are opposed to new large-scale spending.  However, the bill's defenders argue that it has been scaled back, and much of the expenditures will be covered by new revenue.  The non-partisan Congressional Budget Office, the arbiter of such scoring, will publish its full cost estimate on Friday.  Meanwhile, expectations that an announcement will be made shortly on the Fed's leadership were fanned by comments from the Senate Banking Chairman (Brown), who said he was told a decision was "imminent."  It was widely expected before the end of next week.  Reports suggest that Treasury Secretary Yellen has opined that Brainard would be a credible pick, but she is recommending Powell, emphasizing continuity and avoiding the politicization of the post.   Meanwhile, the Fed's Bullard, Barkin, and Daly speak today.  Note that Daly was interviewed for a Board of Governor slot but appears to have turned it down. Canada reports October housing starts today ahead of the October CPI figures tomorrow.  The headline rate is expected to approach 5% though the underlying measures are lower.  The market is positioned for a hike in the March-April period next year.  Recall that the jump in US CPI sent the greenback up from just below CAD1.2400 to slightly above CAD1.2600 at the end of last week.  It reversed lower before the weekend and slipped briefly below CAD1.2500 today, roughly the (50%) retracement of the CPI-inspired gains, before rebounding. Initial resistance is seen in the CAD1.2535-CAD1.2560 area.  Mexico's economic diary is light, and the movement of the peso may reflect broader forces.  For the past three sessions, the dollar has been consolidating in a broad range against the peso (~MXN20.45-MXN20.72). Within that range, initial support may be in the MXN20.55 area.   Disclaimer
Biden Signs a Bill to Revive Infrastructure… and Gold!

Biden Signs a Bill to Revive Infrastructure… and Gold!

Arkadiusz Sieron Arkadiusz Sieron 16.11.2021 14:13
Gold rallied thanks to the changed narrative on inflation, and Biden’s infrastructure plan can only add to the inflationary pressure. Huge price moves ahead? I have a short quiz for you! What the government should do to decrease inflation that reached the highest level in 30 years? A) Decrease its expenditure to make room for the Fed to hike the federal funds rate. B) Press the US central bank to tighten its monetary policy. C) Deregulate the markets and lower taxes to boost the supply side of the economy. D) Introduce a huge infrastructure plan that will multiply spending on energy, raw materials, and inputs in general. Please guess which option the US government chose. Yes, the worst possible. Exam failed! At the beginning of November, Congress passed a bipartisan infrastructure bill. And President Biden signed it on Monday (November 15, 2021). To be clear, I’m not claiming that America doesn’t need any investment in infrastructure. Perhaps it needs it, and perhaps it’s a better idea than social spending on unemployment benefits that discourage work. I don’t want to argue about the adequacy of large government infrastructure projects, although government spending generally fails to stimulate genuine economic growth and governments rarely outperform the private sector in effectiveness. My point is that $1.2 trillion infrastructure spending is coming at the worst possible moment. The US economy is facing supply shortages and high inflation caused by surging demand, which choked the ports and factories. In short, too much money is chasing too few goods, and policymakers decided to add additional money into the already blocked supply chains! I have no words of admiration for the intellectual abilities of the members of Congress and the White House! Indeed, the spending plan does not have to be inflationary if financed purely by taxes and borrowing. However, the Fed will likely monetize at least part of the newly issued federal debt, and you know, to build or repair infrastructure, workers are needed, and steel, and concrete, and energy. The infrastructure spending, thus, will add pressure to the ongoing energy crisis and high producer price inflation, not to mention the shortage of workers. Implications for Gold What does the passing of the infrastructure bill imply for the gold market? Well, it should be supportive of the yellow metal. First, it will increase the fiscal deficits by additional billions of dollars (the Congressional Budget Office estimates that the bill will enlarge the deficits by $256 billion). Second, government spending will add to the inflationary pressure, which gold should also welcome. After all, gold recalled last week that it is a hedge against high and accelerating inflation. As the chart below shows, gold not only jumped above the key level of $1,800, but it even managed to cross $1,850 on renewed inflation worries. The infrastructure bill was probably discounted by the traders, so its impact on the precious metals market should be limited. However, generally, all news that could intensify inflationary fears should be supportive of the yellow metal. You see, the narrative has changed. So far, the thinking was that higher inflation implies faster tapering and interest rates hikes and, thus, lower gold prices. This is why gold was waiting on the sidelines for the past several months despite high inflation. Investors also believed that inflation would be transitory. However, the recent CPI report forced the markets to embrace the fact that inflation could be more persistent. What’s more, tapering of quantitative easing started, which erased some downward pressure on gold. Moreover, despite the slowdown in the pace of asset purchases, the Fed will maintain its accommodative stance and stay behind the curve. So, at the moment, the reasoning is that high inflation implies elevated fears, which is good for gold. I have always believed that gold’s more bullish reaction to accelerating inflation was a matter of time. It’s possible that this time has just come. Having said that, investors should remember that market narratives can change quickly. At some point, the Fed will probably step in and send some hawkish signals, which could calm investors and pull some of them out of the gold market. My second concern is that gold could have reacted not to accelerating inflation, but rather to the plunge in the real interest rates. As the chart below shows, the yields on 10-year TIPS have dropped to -1.17, a level very close to the August bottom. When something reaches the bottom, it should rebound later. And if real interest rates start to rally, then gold could struggle again. However, I’ll stop complaining now and allow the bulls to celebrate the long-awaited breakout. It’s an interesting development compared to the last months, that’s for sure! 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
The Elephant in the Room

The Elephant in the Room

Monica Kingsley Monica Kingsley 16.11.2021 15:42
S&P 500 is starting to run into a setback even if VIX doesn‘t reveal that fully. Credit markets going from weakness to weakness spells more short-term woes for stocks – a shallow downswing that feels (and is) a trading range before the surge to new ATHs continues, is likely to materialize in the second half of Nov. We may be in its opening stages – as written yesterday: (…) Can stocks still continue rallying? They look to be setting up for one more downleg of the immediately predecing magnitude, which means not a huge setback. The medium-term path of least resistance remains up – the Fed is still printing a huge amount of money on a monthly basis, and it remains questionable how far in tapering plans execution they would actually get – I see the risks to the real economy coupled with persistently high inflation as rising since the 2Q 2022 (if not since Mar already, but most pronounced in 2H 2022). Stocks are still set for a good Dec and beyond performance. The elephant in the room is (the absence of) fresh debt issuance lifting up the dollar, making it like rising yields more. Not only that these are failing to push value higher, but the tech resilience highlights the defensive nature of S&P 500 performance. Crucially though, precious metals are seeing through the (misleading dollar strength) fog, and are sharply rising regardless. Make no mistake, with the taper reaction, we have seen what I had been expecting (or even better given that I prefer reasonably conservative stance without drumming up expectations either way) – I had been telling you that the hardest times for the metals are before taper. And the magnitude and pace of their upswing casts a verdict on the Fed‘s (likely in)ability to follow through with the taper execution, let alone initiate the rate raising cycle without being laughed off the stage as markets force these regardless of the central planners. The galloping inflation expectations are sending a very clear message: (…) if you look at the great white metal‘s performance, it‘s the result of inflation coming back to the fore as the Fed itself is now admitting to high inflation rates through the mid-2022, putting blame on supply chain bottlenecks. Oh, sure. The real trouble is that inflation expectations are starting to get anchored – people are expecting these rates to be not going away any time soon. Precious metals are going to do great… Copper is awakening too, and commodities including oil would be doing marvels. TLT downswings would be less and less conducive to growth, so if you‘re still heavily in tech, I would start eyeing more value. Let me add the Russell 2000 and emerging markets to the well performing medium-term mix. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 bulls didn‘t make it too far before running into another (mild, again I say) setback – so far, a sideways one. Credit Markets Credit markets renewed their march lower, and unless they turn, the S&P 500 upswings would remain on shaky ground (if and when they materialize). Gold, Silver and Miners Gold and silver remain on a tear, and even for the breather to unfold, it takes quite an effort. The bears clearly can‘t hope for a trend change. Crude Oil Crude oil bulls keep defending the $80 level, with $78 serving as the next stop if need be – these consecutive lower knots keep favoring the bulls, just when the right catalyst arrives. Whether that takes one or two days or more, is irrelevant – it will happen. Copper Copper ran into an unexpected setback, which however doesn‘t change the outlook thanks to its relatively low volume. I‘m still looking for much higher red metal‘s prices. Bitcoin and Ethereum Bitcoin and Ethereum are seeing an emerging crack in the dam that doesn‘t tie too well to developments elsewhere. The bulls should step in, otherwise this yellow flag risks turning into a red one. Summary S&P 500 bulls are now holding only the medium-term upper hand as the rally is entering a consolidation phase. Anyway, this trading range would be followed by fresh ATHs, which would power stocks even higher in early 2022. Precious metals have quite some catching up to do, and the long post Aug 2020 consolidation is over. Copper, base metals, oil and agrifoods are likely to keep doing great as inflation expectations show that inflation truly hasn‘t been tamed in the least. 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.
Strategy sessions - How to trade EURUSD and the EUR crosses

Strategy sessions - How to trade EURUSD and the EUR crosses

Chris Weston Chris Weston 16.11.2021 16:30
The recent EURUSD move could be considered a classic case study for traders, across strategies, and notably for those who cut their craft on timeframes larger than 30 minutes. On one hand, the attraction to own USDs is almost too obvious and that worries me as a USD bull – we have inflation far higher than where the Fed has been forecasting only back in September and unemployment is also trending towards what the Fed considers ‘full employment’. We get the November CPI print on 11 December and that promises to be even hotter than the October print of 6.2% YoY. The Fed meet on 16 December, and in response we should get some punchy upward revisions to their forecasts on labour and inflation. Given the potential revisions on economic projections, it feels incredibly likely that the pace of QE tapering should subsequently accelerate - this sets up an earlier finish for asset purchases and ultimately opens the door to potentially start hiking from as early as May 2022. The Fed’s median projection for the fed funds rate (the dots) in 2022 is for one hike – it’s feasible to believe this lifts to two hikes next year. So, it's straightforward to take a constructive view on the USD, especially when you hear from former Fed officials Bill Dudley and Jeffery Lacker that they think the fed funds rate may need to move to 3% to control inflation. That would get the USD bulls excited, although 3% would probably be seen as a potential policy mistake by many. Year-to-date moves vs the USD Preview (Source: TradingView - Past performance is not indicative of future performance.) The market has some key event risks in its sight and are clearly running a progressively greater short EURUSD position into the Nov CPI print and FOMC meeting – and that has started now. We also have an important ECB meeting (also on the 16 December) and that too could be a volatility event – it promises to be a huge 24 hours for EURUSD and the EUR crosses! We can talk up the USD but looking across the FX universe this appears to be a EUR move, with our EUR spot basket (EURX on MT4/5) at the lowest levels since May 2020. Aside from the JPY, the EUR is the weakest G10 currency in 2021 – and is at the bottom of the pack on a 1-, 3- or 6- month basis – a true momentum play. EURUSD has been at the heart of the falls in our EUR basket and has been predictably well traded by clients. Maybe this is as simple as a central bank divergence play – with the ECB aggressively pushing back on expected rate hikes in 2022, hell-bent on the view that inflation is in fact ‘transitory’. While the Fed, on the other hand, are open-minded to hiking, if it's required, and the market certainly is adamant it will be in 2022 - and could soon be pricing 3 hikes in 2022. Trading diverging monetary policy paths is perhaps the most simplistic form of tactical trading, in essence, it's FX trading 101, and it's working and we’re all witnessing the trend lower. We’re seeing a similar theme play out in EURCAD and EURNZD, and EURCAD is especially interesting as the cross has broken its consolidation range and if we see a hot Canadian CPI print (Thursday 00:00 AEDT) then the market will expect a rate hike in January by the BoC. Diverging monetary policy expectation’s part explains the move in EURCHF, but it clearly doesn’t explain the one-way move in EURJPY from 133.50 to sub-130. As we explain here EURCHF should be on all FX traders’ radars. So the market is clearly happy to sell EURs and the order books at banks would have become quite one-sided. Trend-followers and momentum-based funds, many of them systematic, would have been all over this move lower adding to shorts as price broke level after level. And, while EURUSD implied or realised volatility hasn’t picked up markedly, the rallies from 1.2260 (in May) have been corrective in nature and short-lived Preview (Source: TradingView - Past performance is not indicative of future performance.) The question I'm asking now and noting that US non-farm payrolls, CPI and FOMC meetings are still some way off, is how to best trade the EURUSD in the near term. That's of course determined by strategy – in this case, mean reversion or momentum. To buy EURUSD as a mean reversion play – personally, I feel the counter rallies should be limited so would change to an ultra-short-term moving average (such as the 5-day EMA) over a traditional 20-day MA Leave limit orders to sell into the former downtrend at 1.1415, or take the timeframe in and see the reaction, price action and behaviour into the former trend before initiating shorts Or, just to stay short as a pure momentum trade and have a stop above 1.1464. One way moves and mature trends eventually come to an end, notably when positioning becomes too extreme – over loved consensus trades rarely end well if you’re the last one in. However, while the street is clearly short of EURs, the fundamentals justify this and if heat come out of the move, then it should offer a renewed chance to short as we head into a huge December for FX traders.  That’s how I see it as we head towards a wild December of major event risk.
Bitcoin, a battle for freedom

Bitcoin, a battle for freedom

Korbinian Koller Korbinian Koller 17.11.2021 08:01
We find ourselves ensued in various battles. Environmentally, economically, and from a human perspective. As much as it is questionable if coal and oil, centralized money, and wars (attacks on ourselves) hold a prosperous future, change is typically avoided. There have been moments in history where rapid change happened. Most often introduced by a charismatic human being with a compelling principle at a defining moment when a change was needed. S&P 500 Index versus BTC in US-Dollar, Monthly Chart, bitcoin an answer to crisis? S&P 500 Index versus Bitcoin in US-Dollar, Monthly chart as of November 16th, 2021. The bitcoin idea was born as a response to the crash of 2008. In its principles, diametrical to fiat currencies. Bitcoin is decentralized, limited, deflationary and digital. There is no historical event where increased money printing has resolved economic turmoil. And yet, we have not come up with a better solution, or at least we have not implemented it yet. The chart above shows how shortly after the crash of 2008, the first transaction ever sent on the bitcoin blockchain was completed in January 2009.Coincidence? It took some time until the cryptocurrency’s pseudonymous creator Satoshi Nakamoto found traction with his idea reflected in bitcoin’s price rise. Still, it has not just caught up but outperformed the market by a stunning margin. BTC in US-Dollar, Monthly Chart, don’t underestimate powerful ideas: Bitcoin versus gold and silver in US-Dollar, Monthly chart as of November 16th, 2021. Covid provided like a steroid a means to illustrate many shortcomings in a magnified way. The chart above shows that bitcoin speculation was an answer to where many find a more prosperous future compared to precious metals. In addition to fundamentals and technical, the underlying idea and hope for a transitory future got traction when people were most afraid.   BTC in US-Dollar, Monthly Chart, sitting through turmoil with ease: Bitcoin in US-Dollar, Monthly chart as of November 16th, 2021. Dissecting markets like this in all their shades and facets is necessary for discovering underlying currents, motivation, and sustainability of trends. In bitcoins case, the found strength of application, beliefs, and principles inherent in bitcoin itself and its traders allows for sitting more easily through its volatility swings. Once the mind grasps reason, it tolerates easier, otherwise hardships to trade a volatile vehicle like bitcoin. With a battle ensured on this magnitude and for an expected long duration, one can accept deep retracements in a more tranquil fashion. The monthly chart above shows that bitcoin might face one of those quick dips that hodlers accept, knowing that the battle isn’t over yet. Bitcoin, a battle for freedom: Mills are grinding slowly. Change typically takes time, and those holding the reign over financial power will certainly not surrender such summoned energies lightly. While this world certainly needs a more adaptive behavior of humanity both for its wellbeing and the planet itself, it is unlikely that a shift, if at all, will be swift. This means that bitcoin is a continued struggle to establish itself. And this will result in continued high volatility for the years to come. As such, it will remain an excellent opportunity for the individual investor. 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 subscribe to our free newsletter. This article does 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.
Finally Shining: Gold & Silver Rally Amid USD Strength

Finally Shining: Gold & Silver Rally Amid USD Strength

Topdown Charts Topdown Charts 17.11.2021 08:39
We are upgrading our view on gold given a positive turn in several technical indicators A bearish macro backdrop persists, however, and gold’s long-term valuation is still not very compelling Our Weekly Macro Themes report investigates interesting moves such as a rising US Dollar as precious metals rally Investors were ready to write off precious metals in September and October. After all, what should have been the perfect environment for a rally in gold and silver (immense monetary and fiscal stimulus, rising inflation fears, and negative real interest rates) turned out to be a period of significant losses. Moreover, the opportunity cost of owning precious metals (and related mining stocks) was extreme from Q3 2020 through much of 2021. Prices Turn Higher Things changed at the end of last quarter. The silver ETF and gold miners staged impressive rallies while the S&P 500 surged in October. And now gold is perking up. These bullish moves went under the radar given the massive equity market climb. The Weekly Macro Themes report dives into the many intriguing moves taking place in gold, silver, gold miners, and the US Dollar. We Turn Neutral from Bearish For a variety of reasons, we have turned neutral on gold from a bearish view. There has been significant improvement in gold’s technical picture, and sentiment & positioning trends lean bullish. The major headwind is, of course, a tightening cycle from the Federal Reserve. Other central banks are charging ahead with rate hikes. Investors Remain Underweight Relative to History It’s possible that the bearish macro/policy backdrop was discounted into the price of gold. Investors were also lightly positioned to the yellow metal. Our featured chart illustrates just how bearish market participants were (and still are) to gold. Implied ETF allocations peaked a decade ago near 8%, but then collapsed to the 1-2.5% range for the better part of the past seven years. Featured Chart: Implied ETF Allocations to Gold Are Skidding on All-Time Lows Better Flows and Momentum Gold’s recent jump is buttressed by a higher low in our ETF flow indicator. Moreover, the FX breadth indicator (which tracks the performance of gold versus a basket of currencies) says there is some momentum behind this past several weeks’ price action. Gold’s chart appears more bullish when priced in currencies other than the Greenback. Still, we await a more decided breakout before turning outright bullish. Long-Term Valuations Still Lean Expensive Another piece of evidence that makes us cautious is our gold valuation indicator which still reads as “expensive” despite a significant reset from 2020’s extreme level; gold’s composite long-term valuation Z-score is about 0.5 to the expensive side. Higher Gold with A Higher Dollar? What’s fascinating about the recent jump in precious metal prices is that it has transpired with a rising US Dollar Index. The DXY made an initial breakout last week. Conventional wisdom says a higher dollar is a negative for precious metals, but we find many examples where both gold and the USD have rallied in the past. The move often catches traders off-guard. Gold Miners and Silver Also in Focus Concerning gold miners, the Weekly Macro Themes report details an updated stance on the seemingly left-for-dead group of stocks. We also dig into what has been developing in the silver market. Bottom line: Our view on gold has shifted from bearish to neutral given a plethora of macro factors, but mixed monetary signals and somewhat elevated gold valuations still suggest caution. At the same time, our bullish stance on gold miners initiated two months ago is reiterated. Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
Intraday Market Analysis – USD Pushes Higher

Intraday Market Analysis – USD Pushes Higher

John Benjamin John Benjamin 17.11.2021 09:08
EURUSD lacks support The US dollar inched higher after October’s retail sales beat expectations. There has been a lack of interest in the single currency following its fall below the daily support at 1.1530. The divergence between the 20 and 30-hour moving averages indicates an acceleration in the sell-off. The bears are targeting the demand zone around 1.1200 from last July. The RSI’s oversold situation may prompt momentum traders to cover. Though a rebound is likely to be capped by 1.1370 and sellers would be eager to sell into strength. GBPJPY attempts to rebound The sterling recouped losses after Britain’s unemployment rate dropped to 4.3%. On the daily chart, the pair saw support near the 61.8% (152.60) Fibonacci retracement of the October rally. A bullish RSI divergence was a sign that the bearish pressure was fading. A break above 153.60 could be an attempt to turn the mood around. The initial surge may need more support after the RSI shot into the overbought area. Should the pound stay above 152.35-152.60, a rebound would lift it towards 155.20. NAS 100 tests peak The Nasdaq 100 bounces back supported by robust tech earnings. The index showed exhaustion after a four-week-long bull run. A combination of an overbought RSI and its bearish divergence made traders cautious in buying into high valuations. A break below the psychological level of 16000 has triggered a wave of profit-taking. A deeper retreat below 16020 would send the index to the previous peak at 15700 which coincides with the 30-day moving average. On the upside, A rally above 16400 would resume the uptrend.
Gold Spot shorts at strong resistance at 1868/72 worked again as we held below 1877.

Gold Spot shorts at strong resistance at 1868/72 worked again as we held below 1877.

Jason Sen Jason Sen 17.11.2021 10:14
Gold Spot shorts at strong resistance at 1868/72 worked again as we held below 1877. Yesterday's bearish engulfing candle is a sell signal. Silver shorts at resistance at the 200 day moving average at 2535/40 also worked perfectly offering up to 55 pips profit so far. Yesterday's bearish engulfing candle is a sell signal. WTI Crude December longs at first support at 7990/60 work on the bounce to first resistance at 8150/80 for some profit taking. A high for the day exactly here which worked for anyone trying shorts. Update daily at 06:30 GMT Today's Analysis. Gold holding strong resistance at 1868/72 re-targets 1857/55 before a retest of first support at 1842/39, which could be seen this morning. Try longs with stops below 1836. A break lower is a sell signal targeting 1832/30 & 1824/22 then a buying opportunity at 1819/16. Try longs with stops below 1812. Strong resistance at 1868/72. Shorts need stops above 1877. A break above here would be a buy signal for this week targeting 1885, 1895, 1900/03 & probably as far as 1914/16. Silver shorts at resistance at the 200 day moving average at 2535 hit minor support again at 2485/80 for profit taking. Be ready to sell a break below 2475 today targeting strong support at 2450/40, which could see a low for the day. Longs need stops below 2430. Sell again at resistance at the 200 day moving average at 2535/40. A break above 2540 however is a buy signal this week targeting 2570/80 then 2600, perhaps as far as 2640/50. WTI Crude December shorts at first resistance at 8150/80 work on the retest of first support at 7990/60. Longs need stops below 7930 for a retest of last week's low at 7835/25. A break lower targets 7760/50, perhaps as far as 7650/30. Shorts at first resistance at 8150/80 need stops above 8210 today. A break higher should target 8280/90, perhaps as far as 8340/50. Above here this week look for strong resistance at 8480/8500. https://youtu.be/wLHeL94ic3Y To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
OVERVIEW OF COVESTING

OVERVIEW OF COVESTING

Prime XBT Prime XBT 17.11.2021 09:37
Nearly everyone familiar with the world of cryptocurrency knows about the successful platform called ChainLink. Also called LINK, ChainLink is the fifth global cryptocurrency platform in terms of market capitalization.  The mission of this decentralized union is to enhance real-world data in connecting smart contacts. This platform has grown its worth by 100% since January 2020. If you are wondering what cryptocurrency platform to invest in gain as much as 100% returns, this article holds the answer. In this article, we will introduce you to Covesting, provide vital information about the platform, and guide you as to whether or not you should get involved in Covesting. What you need to know about Covesting Covesting is a financial technology (fintech company) operating globally and registered in Gibraltar.  The company handles a vast range of software needs and offers solutions to individual customers and institutions globally. Covesting is one of the international firms that received the Distributed Ledger Technology License by the Gibraltar regulatory authorities, which gives it a boost and assurance of great achievements in 2020. Traders and new users can connect on Covesting through the Copy trading or social trading feature. The copy trading or social trading feature allows users to identify expert traders on the platform. After selecting experienced traders, they can automatically copy their trading patterns. Copy-trading or social trading is a smart tactic for both traders and their followers to earn a profit. In practice, when a trade is profitable, the expert trader receives a share of the profit from their followers. Likewise, the followers can trade with fewer fees and greater ease even if they are a novice in trading crypto. Covesting also has a unique token called COV that traders on the platform can use for their activities. Read on to learn more about COV and other features in Covesting. PrimeXBT's partnership with Covesting Covesting is in partnership with a renowned and award-winning trading platform PrimeXBT. The firm won the 2020 ADVFN International Financial Awards as the Best Bitcoin Margin Trading Platform.  PrimeXBT offers Bitcoin trade, forex, indices, stocks, commodities, etc. on a global scale and has over 1 billion USD trading volumes. Other features on PrimeXBT 1: 100 cryptocurrency leverage Accumulated assets from different asset providers. A safe and secure platform for trade. Vast range of trading tools. How to use Covesting through PrimeXBT Users and traders can assess Covesting through PrimeXBT and create strategies for funding and trading in a transparent environment. Tracking records will be made visible to potential traders who can monitor the trade records of expert traders. The followers will see their capital investment and returns, and then decide whether or not to copy the trade. You can search traders through the Covesting area. From the search results, you can decide on a successful trader to follow and copy. Following a trade and copying the trading pattern helps you to earn passive income with little or no knowledge. The traders-followers pattern is also an avenue for the traders to build their reputation. It will earn them more profit if they know what to do. Is COV Likely to Skyrocket? Investors can use the Covesting token (COV) to invest in the platform. Investing with the token is very profitable when the value appreciates.  Those interested in serious investment and profits can avail themselves of the supply of token available on the platform. 18,000,000 tokens are in circulation out of a total of 20,000,000 tokens. Top investors referred to as 'strong hands' control 50% of the total token in circulation. Covesting differentiates its utilities into core and secondary token utilities. With an ambitious business goal and direction, Covesting is out to expand its frontiers in business and fintech. The firm aspires to obtain more partnership deals with other third-party trading platforms asides from PrimeXBT through the white-label licensing agreements. With its current partnership with PrimeXBT, the two companies want to integrate the COV token into PrimeXBT. The purpose of this integration is to reduce the trading fee, expand the success fee, and increase followers' limits. Reduced Trading Fee A reduced trading fee is achievable for strategy managers who hold COV. The deduction in trading fees will cover about 10%-100% of the COV token, although, the particular COV discount level has not been ascertained. Higher Success Fee Percentage Followers can earn a higher percentage of profits on their success fee when they stake with COV tokens. Presently, profits from closed trades on Covesting are shared between the platform, traders, and followers. The percentage distribution of profit is calculated depending on the current rates and market conditions, of which traders and followers will receive a greater percentage profit than the platform. Limits on Follower Numbers Covesting plans to enforce a limit on followers to keep their utility high. However, a trader can increase follower numbers when they start staking COV tokens. Token Burns Covesting will calculate and burn a specific amount from its monthly or quarterly generated fees. The token burn will exclude affiliate earnings, fee discounts, and other costs.  Covesting has an admirable customer base, and the COV has a strong medium-term potential. Traders can also trade COV on other platforms, including onKuCoin. Benefits of Covesting and its COV-token In summary, these are what you can benefit from trading on Covesting and using the COV token. Team of trustworthy holders. Higher token value. Reliable partnerships with other renowned platforms. Possibilities of utility and token burns. Recommended by analysts on TradingView. A community of dedicated followers. Legitimate, registered, and regulated platform Token is still under the radar Our Verdict Our review has shown that investing and trading on Covesting has many benefits. However, this should not be your final research before investing your funds in this platform.  Find out more about Covesting and COV before you invest and trade. To learn more about the COV token and trading, you can visit their website. Also, follow traders to learn about their trading strategy.  In all, our verdict is that Covesting is a very promising platform for investment and trading, but make sure you do not invest until you are convinced that it is the best platform for you.
Covesting

Covesting

Prime XBT Prime XBT 15.11.2021 09:47
The decentralised oracle network ChainLink works by connecting contracts with data from around the world. Now one of the most popular cryptocurrencies, it can make you wonder where the next big cryptocurrency will be coming from and, more importantly, how to get on board before it explodes in popularity. It is time to introduce you to Coversting. What Is Covesting? Covesting is an international fintech corporation which offers an array of software solutions for customers across the world. Recognising the importance of being based in a country where the government fully supports what the company is about, Covesting is based in Gibraltar. Quickly becoming one of the first companies in the world to receive a Distributed Ledger Technology License, also referred to as DLT, from the authorities in the British Overseas Territory, Covesting has its own token; COV. Developing their own platform, Covesting connects traders with a variety of followers, a little similar to social media, allowing for both the follower and the trader to make profitable gains. Traders earn a small fee from the equity of their followers, while the followers benefit from hassle free trading by following the trader’s most successful strategies. This process is known as ‘copy trading’. Partnership with PrimeXBT Now available to everyone via PrimeXBT, the Covesting platform allows traders to make profit from each other as well as their own followers. To make capital, transparency is key. Traders create funds with their best strategies which users can then easily verify, along with the track record of the trader and how much money has been invested into each fund. If traders are able to build and maintain a good reputation, they will be able to generate a second income by attracting new followers. Users can view traders objectively, looking at their results and only invest when they are comfortable they have selected the right trader for them. This way, capital can be generated passively without knowledge of the market or any trading skills. PrimeXBT Offering services such as foreign exchange and stock indices, PrimeXBT is a Bitcoin based trading platform. With trading volumes over $1 billion (USD), in 2020 the company won ‘Best Bitcoin Margin Trading Platform’ at the International Financial Awards. As a platform, PrimeXBT can provide up to one hundred times leverage for cryptocurrencies, a wide range of technical analysis tools and extra security for efficient and safe trading. Why Will COV Be Popular? With a limited supply of tokens, only 18 million COV tokens are in circulation and half of these are held in ‘strong hands’. Holders of the tokens gain access to benefits and COV utilities will be divided up between Secondary and Core token utilities. Moving forward, Covesting plans to partner with other third parties to increase the utilities offered to token holders. So what will a COV token be used for? Well, it will be integrated into PrimeXBT and will be used for a number of functions. These include: Trading Fee Reduction Fee reduction tiers will range from between 10% and 100%, and the level of reduction permitted will depend on the amount of COV tokens held. The number of tokens required for each level reduction will be announced at a later date though there are a variety of options and benefits available. Improving Success Fee Percentage Followers can favourably increase the percentage of success fees by staking tokens and taking advantage of its utility. At the moment, Covesting takes a percentage of success fees on closed profitable trades. Determined by the corresponding offer, Covesting then distributes the remaining percentage between the follower, the strategy manager and the platform. Offers are subject to change depending on the current market conditions. By staking a certain amount of COV tokens, Covesting has a smaller percentage, with a larger share going to the follower on profits made by the strategy manager. Increasing Following Limits In order to keep token utility levels high, Covesting implements limitations on the maximum number of unique followers permitted, in addition to imposing limitations on capital. Staking COV tokens unlocks followers and raises capital limits. Token Burns Covesting will burn a portion of fees generated at regular intervals throughout the year. Calculated fees will exclude affiliate earnings, fee discounts and various other revenue impacts. COV tokens have a lot of potential in a relatively short time frame, being traded on KuCoin and Inter Alia. Covesting is surrounded by a very supportive community with the price reaction to Covesting’s module launch on PrimeXBT being extremely positive. In Summary The best piece of advice you can get is to visit the Covesting website and carry out your own research about the token before deciding whether or not to invest. You may also wish to try your hand at trading cryptocurrency on PrimeXBT. If you follow this link, you will receive a welcome bonus of $50 when you sign up. When you start to follow traders, it is important to remember that their past results are not a guarantee of any future results. You should also look at how long a certain strategy has been live on the platform. For example, the newer the strategy the more risk it involves and following some strategies can result in financial losses. This said, if you cannot afford to lose capital, do not invest until you are prepared to accept the risk of loss. Reasons for Holding COV Main reasons for holding COV tokens include: Trusted, licensed company Limited token supply Under the radar at the moment Future utility plans Top TradingView analyst recommendations Token burns Strong sense of community
A Guide To PrimeXBT V2.0

A Guide To PrimeXBT V2.0

Prime XBT Prime XBT 15.11.2021 09:43
PrimeXBT, your award-winning trading platform, has been upgraded to deliver even more value to the trading community. This upgrade includes several improvements to the platform's appearance and interface. But the biggest reason for the upgrade is the addition of Ethereum and stablecoin based margin accounts. In this guide, you will find all you need to know about the introduction of ETH, USDT, and USDC margin accounts, as well as other features of PrimeXBT's upgrade to version 2.0. Welcome To Version 2.0 When you first log into your account (since the upgrade), you’ll be greeted with a message introducing the updates. There are a few slides that also inform you of all the new features that have been added. You’ll notice that the dashboard has been reorganized and now includes a Main account section. This section provides you with the information you need regarding your margin accounts, wallet, followings or Covesting accounts, and more. The New Main Page Shows You All You Need In One Glance You can execute several operations from the Main page because it provides you everything you need at a glance. Some of these tasks include initiating withdrawals, making deposits, viewing your balances, creating margin accounts, and more. No matter the cryptocurrency (BTC, ETH, USDC, and USDT), you can create a separate margin account for each. You can also deposit COV tokens, but these are not for your margin accounts. Their use will be explained further in this guide. To fund any account from your PrimeXBT’s Main page, you have to deposit funds into the secure cryptocurrency address for that account. You can find the address within your PrimeXBT account dashboard. Once funded, you will need to move the crypto into the margin account from your wallet. New Accounts In ETH, USDC, and USDT With the Bitcoin-based margin trading, PrimeXBT earned many awards. Now there’s more! PrimeXBT has added Ethereum, Tether, and USD Coin. This is one of the Version 2.0 upgrade's most significant features and has been merged into the same account system and internal trading engine. You can use these currencies beyond Bitcoin-based margin trading. Get a free account with PrimeXBT and start trading with a small minimum deposit. You can sign up in less than 59 seconds, so do so now if you haven't registered with PrimeXBT. There are more than 50 CFDs for you to trade on PrimeXBT, and they cut across stock indices, commodities, crypto, Forex, and more. You can trade all of these within each individual currency type. You will find isolated account details within each dedicated margin account. Your All-New Reports Section PrimeXBT has also added a Reports section which contains detailed vital account information. You can find information such as a log of all your transactions in this section. This makes tax reporting and bookkeeping very easy. The Updated Referral Section As a result of the inclusion of these new currencies, the referral section has also been upgraded. This section of the website now lists commissions in whichever currencies new users trade in. In order words, if a user trades in Ethereum, commissions are generated and paid out in Ethereum. So, when you refer anyone to PrimeXBT, you will get your commissions in the currencies the user trades in. The referral system includes simple referral links you can use on different media, including forums and social media. You can share it with friends and loved ones too. Depending on where you are on PrimeXBT’s four-level referral system, you can get as much as 20% commissions per referral. Enhancements To The Covesting Copy Trading The Covesting Trading Module has been an innovative copy trading system connecting followers to strategy managers. The system makes it possible for both parties to earn and profit. With the addition of ETH, USDC, and USDT, this module has also been upgraded to support these cryptos and given a facelift. How Covesting Copy Trading Works Strategy managers post their trades for followers to copy. When they close their positions, both parties earn. These more skilled traders earn a commission (success fees) off of followers’ capital commissions. These commissions can add up quickly, and the top Covesting traders have already earned millions in commissions, as well as generated millions for their followers. Traders are reviewed by a five-star system that spurs everyone to be at their best. They are then ranked accordingly and displayed on global leaderboards, with different success factors, including their wins, total profits, and even losses, highlighted. With the inclusion of other currencies in version 2.0 of PrimeXBT, followers can only follow strategy managers in like-currencies, thus encouraging a diversified Covesting community. Followers with ETH-based margin accounts can now only follow strategy managers with the same currency accounts. We mentioned the COV utility token earlier. It is at the heart of the Covesting copy trading module and can be used to unlock many other benefits within the module. More PrimeXBT Features PrimeXBT has so many incredible features for traders. Some of these include responsive customer service, Turbo, an official blog containing lots of trading tips, educational guides, and more. Turbo With Turbo, you (all traders) have access to unique ways to position yourself in the market. It also includes an analysis section that that seamlessly integrates with TradingView for an incredible technical analysis and risk management experience, and more. Blog & News The company's blog and news tabs keep you updated with news and market information and content to help you become your better version of the trader you are and make the most of your trades. Security PrimeXBT prioritizes security. The platform is highly secure and built on bank-grade security infrastructure. With the help of a distinctive wallet structure that involves cold storage, the platform has never been hack. Each account is secured with address white-listing and two-factor authentication. PrimeXBT also boasts a 99.9% uptime. 24/7 Responsive Customer Support Besides all the fantastic features of PrimeXBT, one of its best is its 24/7 live customer support staff. They are trained and ever-ready to assist you with whatever issues you might have. There’s also a help center containing tutorials to help you with anything. Advanced Trading Tools PrimeXBT’s upgrade to version 2.0 offers traders an all-in-one platform for the complete trading experience. It contains all the advanced trading tools necessary to become the successful trader you always dreamed of while also minimizing risks. It has the best slippage in the industry with stop-loss orders to ensure capital preservation. It also offers you excellent opportunities with its leverages and diverse ways to access the markets. Stable Coins For Added Risk Protection Bitcoin and Ethereum are known to be subject to base currency account volatility. This type of volatility spurred many users to request the addition of stablecoins. With the inclusion of USDT and USDC, traders can now eliminate all risks associated with such volatility. This is one of the fundamental reasons for the upgrade to version 2.0. Today Is Your Best Time To Trade CFDs On An Award-Winning Platform With PrimeXBT's upgrade to version 2.0, you can now use BTC, ETH, USDT, and USDC for margin accounts. You can trade any combination of the most popular markets, including the S&P 500, Bitcoin, Forex, oil, and gold. And you can do this anywhere you are, digitally. All you need is our award-winning platform that has all the basic and advanced tools to help you reach your trading and financial dreams. Use PrimeXBT’s V2.0 Today!
Inflation Is Not The Only Consequence Of The Russian Invasion

Gold holds steady ahead of FED speeches

Walid Koudmani Walid Koudmani 17.11.2021 14:31
Gold holds steady ahead of FED speeches Precious metals have experienced some significant volatility in recent times with the price of gold hovering in a $30 range over the last week and after gaining around 5% since the start of November. This comes despite the significant gains made by the US Dollar which traditionally tends to have an inverse correlation with the price of gold and which has recently reached the highest level since July 2020 as the USD index hovers around 95.946 after reaching a high of 96.255. On the other hand, rising inflation expectations, which have been downplayed extensively by the Federal reserve, continue to drive demand for gold as investors attempt to find covers against it and as markets remain uncertain about upcoming monetary policy decisions. Furthermore, the recent pullback seen in cryptocurrencies has also boosted demand for the precious metals as some seek more traditionally stable opportunities to invest, especially given the fact that gold has had a tendency to perform well heading into the end of the year. Today's Fed speeches could shed some light on what the US central bank is likely to do in the upcoming meeting and what it's outlook for the economy is as inflation continues to reach record levels and as investors seek refuge from rising inflation and excess volatility. Oil deepens decline despite lower than expected API report Whil oil prices have been the topic of discussion for weeks, we are now beginning to see a reversal as both Brent and WTI started the day with a downard gap and with the latter trading at the lowest level since the beginning of November. Traders await today's EIA inventory report for confirmation of yesterday's API report which showed a lower than expected increase in US crude inventories, as demand rises and supply issues remain a topic of discussion. Furthermore, several OPEC representatives and members have reiterated their view to not increase production levels as they foresee a potential market surplus heading into the end of the year due to a projected drop in demand. On the other hand, fuel prices have continued to rise which has led to many businesses transferring those costs onto consumers and ultimately impacting the post pandemic economic recovery. Download our Mobile Trading App:   Google Play   App Store
Gold – USD Relationship Status: It’s Complicated

Gold – USD Relationship Status: It’s Complicated

Przemysław Radomski Przemysław Radomski 17.11.2021 13:27
  If the dollar goes through a corrective downswing, it’s more bullish for gold? Not if a decline in the euro caused gold to rise in the first place. Another day, another new yearly high for the USD Index. The U.S. currency soars just like it has since the beginning of the year, in tune with what I said at that time, (and against what almost everyone else said about its outlook). The rally accelerated recently, with the USD Index soaring by 0.78 this week – and it’s only Wednesday today. So, surely that’s bullish for the USD Index? - one might ask. No. “Bullish” or “bearish” relates to the future, not to the past. In fact, the rally in the USD Index might need a breather as all markets – no matter how bullish or bearish the situation is in them – can’t rally or decline in a straight line, without periodic corrections. The USD Index, gold, silver, mining stocks, and practically all the other markets are no exception from this rule. Even the real estate prices don’t increase over the long run without periodic downturns. As you can see on the above chart, the U.S currency index soared to almost 96 yesterday and it’s after an almost straight-up rally. This rally caused the RSI indicator to move above 70, and this has been a quite precise short-term sell signal this year. In fact, in all cases when we saw it, some kind of short-term correction followed. Based on the size of the current rally, it seems that the current situation is most similar to what we saw in early March and in late June. That’s when we saw short-term declines that took the USDX approximately a full index point lower. In the current case, it could mean a decline back to 95. This would be a perfectly natural thing for the USD Index to do right now, given that the previous resistance (which now serves as support) is located slightly below 95. The support is provided by the late-2020 high and the March 2020 low (not visible on the above chart). So, surely this corrective downswing in the USD Index would cause an even bigger rally in the precious metals sector, right? That’s where things get complicated. You see, the biggest (over 50%) part of the USD Index (which is a weighted average) is the EUR/USD currency pair. Let’s take a look at it. The Euro Index moved sharply lower last week and just like the RSI based on the USD Index flashed a sell signal, the RSI based on the Euro Index flashed a buy signal. Also, the Euro Index just moved to the lower border of its declining trade channel, which is likely to indicate some kind of rebound. Why am I discussing the euro here? Because that’s what’s complicated about the current USD-gold link. The euro recently declined and the prices of silver and gold recently rallied shortly after dovish comments from the eurozone. Namely, while the expansionary nature of fiscal and monetary decisions in the U.S. might be after its peak (with the infrastructure bill signed even despite high inflation numbers), the eurozone is far from limiting its expansionary (i.e., inflationary) policies, and it was just made clear recently. That was bearish for the euro and bullish for the gold price – as more money (euros in this case) would be chasing the same amount of physical gold bars. The point here is that it might have been the decline in the value of the European currency that caused gold to rally, and it had little to do with what happened in the USD Index. Don’t get me wrong, most of the time, the gold-USD link is stable and negative. In some cases, gold shows strength or weakness by refusing to move in tune (and precisely: again) with the U.S. dollar’s movement. But in this case, it seems that it’s not about the U.S. dollar at all (or mostly), but rather about what happened in the Eurozone and euro recently. I marked the recent decline in the euro and the rally in gold with a golden rectangle. The usual link between gold-USD would have one assume that lower USD Index values (due to higher EUR/USD values) would trigger a rally in gold. However, given how things worked and the fact that we saw/heard the news coming from the Eurozone, it seems like this “temporary” and “bearish for the PMs” interpretation would actually prevail. It could also be the case that we see some kind of mixed reply from the precious metals sector when the USD Index and the Euro Index correct. The PMs could for example fall only after the situation regarding the gold-USD link gets back to normal – that is perhaps after both currencies correct. 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.
European Gas Jumps, while the Euro and Yen Slump

European Gas Jumps, while the Euro and Yen Slump

Marc Chandler Marc Chandler 17.11.2021 15:31
Overview: The prospects that the 6.2% CPI will prompt the Fed to move quicker continue to underpin the dollar.  The euro fell to about $1.1265, its lowest level since last September, and the Japanese yen slumped to a fresh four-year low.  The JP Morgan Emerging Market Currency Index tumbled 1% yesterday, the largest decline since February.  A more stable tone is evident in Europe, as the euro has recovered above $1.13, and the JP Morgan Index is paring yesterday's losses.  The dollar is holding just below JPY115.00.  Asia Pacific equities did not fare well.  Only China and Taiwan markets, among the large regional markets, managed to rise.  Europe's Stoxx 600 is edging higher for the sixth consecutive session.  Recall it has fallen only once since October 27.  US futures are narrowly mixed. The bond market is quiet, with the US 10-year hovering around 1.62%.  European yields are a little softer.  Gold slid below $1850 yesterday but has snapped back today to test the $1860 area.  Crude oil is heavy, with the January WTI contract around $78.80, unable to resurface above $80 amid talk that the US and China may coordinate the release of strategic holdings.  Gas prices are up another 7% in Europe today after surging 16% yesterday and 9% on Monday. Due to "unplanned maintenance," a Belarus pipeline to Poland has been shut down, which may last three days.  Iron ore prices are giving back around half of yesterday's 1.2% gain, for the third loss in four sessions.  Copper is off for a third session, losing after dropping 2.2% in the past two sessions.   Asia Pacific Japan's October trade data disappointed.  Exports and imports were weaker than expected, and this resulted in a smaller deficit. Exports slowed to 9.4% year-over-year, down from 13% in September, defying expectations for a small double-digit increase.  Imports were up 26.7% from a year ago, off the heady 38.2% pace seen in September and below the 31.8% projected.  The resulting trade deficit of JPY67.4 bln was about a fifth of what economists anticipated (Bloomberg survey).  It is the third consecutive monthly deficit.  In the first seven months of the year, Japan recorded two deficits.  A year ago, Japan recorded a JPY840 bln surplus.   Reports suggesting that the possibility that the US and China coordinate the drawdown of strategic oil reserves are light on details, but the suggestion itself is enough to weigh on prices.  Still, the International Energy Agency yesterday echoed the broad assessment of America's EIA in anticipating that the tightness of the oil market could ease shortly.   Increased output in the US, Saudi Arabia, and Russia may account for half of the 1.5 mln barrel a day anticipated increase in supply. Nevertheless, the acting head of the EIA warned tapping the US Strategic Petroleum Reserve would have a short-term impact, for which other dynamics would quickly overshadow it.  Separately, note that the API estimated a slight build of 655k barrels in US stocks this past week, while gasoline inventories fell.   In other regional developments, Australia's wage price index rose a modest 0.6% in Q3 for a year-over-year pace of 2.2%.  This was in line with expectations.  It would seem to support the RBA's argument that it need not be in a hurry to raise rates.  The June 2022 T-bill yield settled last month at 69 bp and is now near 40 bp.  Separately, China appears to be allowing "high quality" property developments to return to the asset-backed securities market to raise capital after a three-month hiatus. Lastly, reports suggest Beijing is moving ahead with its import substitution plans to reduce dependency on foreign technology.    The dollar approached JPY115.00, where an option for almost $610 mln expires today.  The dollar has not traded above there since March 2017.  Since the dollar broke above JPY112.00, we have suggested that JPY114.50-JPY115.00 may mark the top of the new range.  While this has worked for the past month, the risk is on the upside.  A convincing break of around JPY115.50 would target the JPY118.00 area.  Initial support is now seen near JPY114.70.  Note that the upper Bollinger Band is slightly below JPY114.80.  The Australian dollar is trading near its lowest level since October 6, near $0.7265.  It is holding above a trendline connecting the August and September lows, which is found near $0.7250 today, but little stands in the way of a test on the $0.7200 in the coming days.  An option for a little more than A$800 mln at $0.7300 is set to expire today.  After posting a key upside reversal yesterday, the US dollar consolidated against the Chinese yuan today, and no follow-through buying materialized.  Instead, it seemed that the local market took advantage of the pop above CNY6.39 to sell the greenback, which is straddling CNY6.38 in late dealings.  The reference rate was set at CNY6.3935, just below the bank projections (CNY6.3936, according to the median in the Bloomberg survey).  We note that the yuan is also at its best level since 2015 against the trade-weighted CFETS basket the PBOC uses.   Europe On the heels of a strong employment report, the UK reported a larger than expected increase in the October CPI.  The preferred measure, which includes owner-equivalent housing costs, jumped to 3.8% from 2.9%.  The older measure rose to 4.2% from 3.1%.  On the month, consumer prices rose 1.1% rather than the 0.8% economists forecast (Bloomberg median). Flattered by increasing gas and electricity prices.  Core prices rose 3.4% year-over-year, accelerating from 2.9% in September and defying forecasts for a 3.1% pace.  Separately, producer prices, both input and output, also rose more than expected.  Lastly, UK house prices rose 11.8% year-over-year in September, up from a revised 10.2% in August.  The recent peak was 12.6% in June, which was the highest since 2004.    European gas prices are at one-month highs.  Belarus has stopped its pipeline to Poland, claiming unplanned maintenance issues, while the border tensions and earlier threats raise suspicions of a political move.  Separately, the German regulator suspended the certification process of the controversial Nord Stream 2 pipeline as corporate assets are rearranged.  Separately, a German court yesterday dismissed an environmental challenge to the pipeline.  Lastly, we note that the virus flare-up continues in Europe, and Germany and the Czech Republic reported a record number of cases. The euro surpassed our $1.1290 Fibonacci target and did not find bids until the $1.1265 area in Asian turnover.  The single currency has been in a tight range in Europe, holding above $1.1300.  Initial resistance is seen around $1.1330 now.  A move above yesterday's high, near $1.1385, is needed to lift the tone. We suspect the near big target is closer to $1.10.  Sterling slipped to a three-day low, slightly below $1.34, but shot up to the session high near $1.3375 on the inflation news. However, the momentum was not sustained, and sterling is little changed in late morning European turnover near $1.3430. The euro briefly traded below GBP0.8400 for the first time since March 2020 but snapped back.  An 840 mln euro option at GBP0.8445 expires today and another for about 620 mln euros at GBP0.8450 expires tomorrow.   America US retail sales surged last month, and the 1.7% rise was the best since March.  After slowing in Q3, consumption is off to a strong start in Q4.  Industrial production was also much stronger than expected, rising 1.6% compared with the 0.9% gain anticipated by economists (median, Bloomberg survey).  The US reports October housing starts today, and they are expected to have recovered from the 1.6% decline seen in September. Housing starts fell in Q3 but are seen rising in Q4, encouraged by an easing of some supply chain issues.   In fact, on several fronts, there are preliminary signs that the disruptions are dissipating.  Some reports suggest that the shortage of semiconductor chips may be passed, and US auto sales rose in October for the first time in six months.  Both the EIA and IEA have forecast a more balanced oil market, and some measures of shipping costs have moderated. The Los Angeles port has reportedly reduced the number of empty containers by around a quarter this month as six new sweeper ships have been brought into operation.  In addition, we note that the re-opening of US borders means immigrant workers may begin returning.  There is still much debate, of course, on the extent that the elevated price pressures are the result of supply chain disruptions.  A report by the Bank for International Settlements estimates that without the supply problems, US inflation would be closer to 2.5% and eurozone inflation near 1.5%. President Biden is expected to make his Fed announcements in the next few days, according to reports, but it could slip into early next week.  Powell is still the favorite, and he has Treasury Secretary Yellen's in support.  Yellen warns that action is needed soon on the debt ceiling.  Her efforts may be exhausted early next month.  Lastly, San Francisco Fed President Daly opined she was more bullish on the economy than a year ago.  This seems backward to us.  A year ago, the vaccine was announced, and fiscal stimulus was anticipated after the US election. Going forward, there will be less monetary and fiscal stimulus.  The pent-up demand ("excess savings") is projected to be exhausted by early next year, and, as we have noted, the doubling of the price of oil has preceded the last three recessions in the US. We suspect that there is sufficient stimulus and need to rebuild inventories to sustain reasonably strong growth for the next few quarters, but by the second half of next year, sub-3% growth will return as the norm.  Canada reports October CPI figures today.  The headline is likely to rise to 4.7% from 4.4% in September (Bloomberg median).  However, the base effect points to a further rise this month and December, when in 2020, the CPI rose 0.1% and fell 0.2%, respectively.   The underlying core rates are also increasing.  The Deputy Governor of the Bank of Canada cautioned about the high degree of uncertainty around potential structural shifts in the labor market that make it challenging to gauge full employment with any degree of confidence.  He pointed to economic areas that still show slack.  The market is expecting the first hike next March/April.  Note that tomorrow, the "Three Amigos" (Biden, Trudeau, and AMLO) meet in the US amid concern that the US "Build Back Better" has strong nationalistic elements, including for electric vehicles.     The US dollar posted an outside up day against the Canadian dollar yesterday, and follow-through buying has lifted it to around CAD1.2585.  At the end of last week, the high set was slightly above CAD1.2600, which close approximates the (50%) retracement of the greenback's decline since the September 20 high near CAD1.29.  The next retracement (61.8%) is found by CAD1.2665.  Still, we expect that a firm CPI report will lend the Loonie some support.  The session low, set in late Asia, near CAD1.2540, may be protected a CAD1.2545 option for $600 mln that expires today.  The greenback is consolidating against the Mexican peso today after rallying yesterday from about MXN20.56 to nearly MXN20.85.  The high from earlier this month was near MXN20.98.  It has not been above MXN21.00 since March.  Initial support is seen around MXN20.60.   Disclaimer
COT Currency Speculator Sentiment rising for Euro & British Pound Sterling

Forex: US dollar takes the lead after the jump in inflation

Capital Capital 17.11.2021 16:01
Forex: US dollar takes the lead after the jump in inflation The US dollar rallied against all other currencies on Thursday, after US Consumer Price Index (CPI) rose more than expected in October, reviving speculations about faster interest rate hikes next year.  The US Dollar index (DXY) hovers around new 52-week highs at 95.00 level, gaining 0.8% since the CPI release. US Treasury yields also rose after the inflation surprise, with a 7 basis points (bps) increase in the 2-year yield and 9 bps on the 10-year benchmark.   EUR/USD and GBP/USD both slipped by nearly 0.7% from yesterday’s midday London trading, while they edged down around 0.1% from previous close.   The Swiss franc (CHF) and the Japanese yen (JPY) have lost 0.7% of their value against the greenback since the CPI was out, while the Aussie (AUD) and the Kiwi (NZD) weakened 1.2% and 1.9% respectively.  Elsewhere, emerging market currencies sold-off after the inflation print, with the South African rand (ZAR) and the Mexican peso (MXN) both down 1.4% against the dollar, while the Turkish lira (TRY)  hit new all-time lows by weakening 1% versus the greenback.  US dollar As of writing, the US Dollar index (DXY) was last at 94.98 level, up 0.21% on the day. In October, US inflation was substantially higher than market forecasts and not only confined to COVID-related items but broad based across the main items in the index, as the cost of services is also rising. Core CPI inflation, which excludes food and energy prices, increased by 0.6% points to 4.6% on the year, well above consensus (4.3%). Core inflation in the US reached the highest level since 1991. Headline inflation rose by 0.8% points to 6.2% on the year, hitting the highest level since 1990 and again above expectations of a 5.8% year-on-year rise. Markets are now pricing in a 71% probability, up from 56.5% yesterday, Fed starts hiking interest rate in June next year. DXY technical levels: 52-week high: 95.03 52-week low: 89.212 50-day moving average: 93.59 200-day moving average: 92.08 14-day Relative Strength Index (RSI): 64.83 Euro As of writing, the euro is down 0.15% from previous close versus the US dollar (EUR/USD) and flat against the British pound (EUR/GBP). Yesterday, ECB Governing Council member Robert Holzmann said that asset purchases (QE) could end next in September or December next year, depending on the inflation dynamics. Today, ECB Chief Economist Philip Lane will speak at the 2nd joint ECB-FED New York conference, while ECB executive board member Isabel Schnabel will take part at a Q&A organized by Ludwig-Maximilians-Universität. EUR/USD technical levels: 52-week high: 1.2349 52-week low: 1.1455 50-day moving average: 1.1662 200-day moving average: 1.1882 14-day Relative Strength Index (RSI): 35.72 British pound GBP/USD is down 0.15% to 1.3532 as of writing. On the data front, UK gross domestic product (GDP) preliminary figure came in at 6.6% year-on-year in Q3 (1.3% quarter-over-quarter), disappointing market expectations by 0.2%. Manufacturing production increased 2.8% year-on-year in September, missing market forecast of 3.1%, while business investment was up 0.8% quarter-over-market in Q3, disappointing market expectations of a 2.6% increase. GBP/USD technical levels. 52-week high: 1.4248 52-week low: 1.3091 50-day moving average: 1.3684 200-day moving average: 1.3845 14-day Relative Strength Index (RSI): 33.39
Europe gas prices rise as Nord Stream 2 certification suspended

Europe gas prices rise as Nord Stream 2 certification suspended

Capital Capital 17.11.2021 20:50
Gas prices in Europe increased on Tuesday morning by 3.35% after the German energy regulator suspended the certification process of the Nord Stream 2 gas pipeline. The prices rallied past €83 a megawatt-hour in mid-November, the highest in three weeks, as investors reacted to the news. Moreover, the trading of gas futures on the month-ahead Dutch Title Transfer Facility (TTF), the key European benchmark, was up by 9.8% for December at €87 a megawatt-hour. Statement from Germany’s energy regulator Germany’s energy regulator, the Bundesnetzagentur, announced the certification suspension of Nord Stream 2, the new export gas pipeline running from Russia to Europe across the Baltic Sea, in a statement. It said the Swiss-based consortium needed to form a company under German law to secure an operating licence. “Nord Stream 2 AG, which is based in Zug (Switzerland), has decided not to transform its existing legal form but instead to found a subsidiary under German law solely to govern the German part of the pipeline. This subsidiary is to become the owner and operator of the German part of the pipeline. The subsidiary must then fulfil the requirements of an independent transmission operator as set out in the German Energy Industry Act,” it said. The Bundesnetzagentur also said that the certification procedure will remain suspended until the main assets and human resources have been transferred to the subsidiary and the Bundesnetzagentur is able to check whether the documentation resubmitted by the subsidiary, as the new applicant, is complete.  Knock-on effect of the suspension In addition to the increased gas prices, according to analysts, traders are expecting Russia to increase supplies to Europe only when the project receives its final approval. “Meanwhile, Gazprom booked zero extra gas flows to Europe via Ukraine for December, an auction result showed. Prices were also supported by forecasts of cooler temperatures starting next week,” Trading Economics said. Opposition to the gas pipeline Nord Stream 2 has faced opposition from some European states – and from the US. Those opposed to it in Europe argue that it will make Europe too reliant on Russian gas – despite surging prices due to a jump in demand fuelling some calls for more Russian supplies. Ukraine is also opposed to the gas pipeline as it will lose revenues if gas from Russia bypasses pipelines on Ukrainian territory. Meanwhile, Nord Stream 2 said it had been notified by the regulator but said it is not in a position to comment on the details of the procedure, its possible duration and impacts on the timing of the start of the pipeline operations.
Oil prices ease as markets await fresh guidance

Oil prices ease as markets await fresh guidance

Capital Capital 17.11.2021 20:52
Oil prices retreated on Wednesday as markets are seeking for fresh clues while watching closely for any announcement from the US on its policy to cool gasoline prices. Brent crude oil futures, the international benchmark, dropped 0.59% at $81.94 per barrel (bbl). West Texas Intermediate fell 0.94% to $80/bbl. “The oil market continues to lack direction. Participants continue to wait for signals from the US administration on whether they will release oil from the Strategic Petroleum Reserves (SPR),” ING Group said in its note on Wednesday. Short-term relief “The hesitation appears to be because the market outlook is more comfortable in 2022, while an SPR release would also only offer short-term relief to the market,” ING added. In addition, ING noted, there is potential for Organization of Petroleum Exporting Countries (OPEC) and its partners (OPEC+), to counter US’ release of its SPR by delaying their supply increase. Markets also ignored the International Energy Agency’s monthly oil report released overnight. Brent crude price movement - Credit: Capital.com Oil demand strengthening The International Energy Agency (IEA) in its November oil report keeps its forecast for oil demand growth unchanged from last month’s report at 5.5 million barrels per day (bpd) for 2021 and 3.4 million bpd in 2022. The agency said it maintains its forecast because despite global oil demand is strengthening due to robust gasoline consumption and increasing international travel with more countries reopening their borders, new Covid-19 waves in Europe, weaker industrial activity and higher oil prices will temper gains. Meanwhile, global oil production is already rising. In October, oil supplies leapt by 1.4 million bpd to 97.7 million bpd with the US post-hurricane recovery accounting for half the increase. US oil supply The agency expects an additional boost of 1.5 million bpd in November and December even as OPEC+ disregarded pleas from major consumers to ramp up beyond a monthly allocated 400,000 bpd to cool prices. “Over this period, the US is now poised to provide the largest increase in supply of any individual country,” IEA said in the report. IEA raised its forecast for US oil production by 300,000 bpd for the fourth quarter of this year and 200,000 bpd on average in 2022. The US is set to account for 60% of 2022 non-OPEC+ supply gains, now forecast at 1.9 million bpd. “Even so, the US will not return to pre-Covid rates until the end of 2022,” the agency said.
2 Tools Every Trader Needs: FBS Trader app & MetaTrader

2 Tools Every Trader Needs: FBS Trader app & MetaTrader

Finance Press Release Finance Press Release 18.11.2021 10:37
MetaTrader & FBS Trader app are two essential tools that every trader should use. Don’t rely only on one, use the power of both as they suit different trader needs. In short, MetaTrader is for trading on a laptop/PC, while the FBS Trader app is perfect for mobile trading. Let’s look at how you can use them! MetaTrader When you want to use a personal computer or laptop for trading, you can choose MetaTrader 4 or 5. They are the two versions of one software program that traders use for opening orders and making an advanced technical analysis. MetaTrader offers different technical tools and allows using trading robots (expert advisors). Besides, you can use the FBS Forex broker app to manage your MetaTrader accounts and control finances. FBS Trader app If you want to trade with your mobile phone or just don’t have an opportunity to trade with a PC at the moment, the FBS Trader app is the best choice. Indeed, we can’t sit in front of our personal computers and monitor trades all day long. What to do? The solution is to have the FBS Trader app on your mobile phone and be able to open/close a trade in just one click wherever you are. It’s handy that all your active orders are gathered in a separate section. Besides, imagine that some economic news comes out that can impact your opened trades but you are not nearby your PC. It wouldn’t be a problem if you have the FBS Trader app on your phone. In addition, this app has a built-in economic calendar that allows traders to follow impactful news and analyze the charts without leaving the app. For example, the Bank of England left the rates unchanged during its meeting on November 4, while it was expected to raise them. As a result, the British pound weakened, and GBP/USD dropped. As you may notice in the chart below, you can add technical indicators in the FBS Trader app. In that case, Bollinger Bands could help a trader to confirm the bearish momentum as bands were moving in a narrow range and the price broke through the lower band. Finally, the FBS Trader app allows you to manage your funds freely without leaving the app. You can deposit and withdraw them easily in a few clicks. All in all, MetaTrader and the FBS Trader app are the perfect combination for trading. Enjoy using them!
Intraday Market Analysis – GBP To Test Resistance

Intraday Market Analysis – GBP To Test Resistance

John Benjamin John Benjamin 18.11.2021 10:37
GBPUSD bounces higher The pound inched higher after the UK’s inflation soared to 4.2% in October. Sentiment remains pessimistic after a botched rebound from the demand zone at 1.3420. However, an oversold RSI has attracted some buying interest. Its bullish divergence suggests a slowdown in the sell-off, prompting momentum traders to take profit and look for the next breakout. The sterling may bounce back if the bulls succeed in keeping it above 1.3380. 1.3530 would be the first hurdle. Otherwise, a bearish breakout would send the pair to 1.3200. USDCAD reaches new high The Canadian dollar fell back after the annual inflation rate matched the consensus. Following the greenback’s rally from the demand zone at 1.2300, a bullish MA cross on the daily chart suggests that the current rebound is picking up steam. As a sign of strong commitment, buyers were eager to keep price action above 1.2480 when the RSI flirted with the oversold area. A break above 1.2600 may trigger an extended rally towards the daily resistance at 1.2760. 1.2540 is fresh support in case of a pullback. USOIL falls through key support WTI crude tumbled after OPEC warned of supply surplus. The rally has stalled after the bulls struggled to lift offers at 85.00. On the daily timeframe, the RSI’s double top in the overbought area indicates an overextension. A break below 79.00 has led to profit-taking and put the long side under pressure. 81.60 is now a fresh resistance from the latest sell-off. The buy-side will need to achieve new highs before they could bring in momentum interest. Failing that, 75.00 is a key floor to keep price action afloat.
The Top 5 Companies Added to Our Stock Market Watchlist this Quarter

The Top 5 Companies Added to Our Stock Market Watchlist this Quarter

Invest Macro Invest Macro 18.11.2021 10:56
By InvestMacro The fourth quarter of 2021 is approximately halfway over and we wanted to highlight some of the top companies that have been analyzed by our QuantStock system so far. The QuantStock system is an algorithm that examines each company’s fundamental metrics, earnings trends and overall strength trends 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 system does not take into consideration the stock price so one must compare each idea with their current stock prices. Many studies are consistently showing overvalued markets and that has to be taken into consideration with any stock market idea. As with all investment ideas, past performance does not guarantee future results. Here we go with 5 of our Top Stocks halfway through Quarter 4 of 2021: Gilead Sciences Inc. Health Care, Large Cap, 4.29% Dividend, Our Grade = A Gilead Sciences Inc. (NASDAQ: GILD) is first up and is a company engaged in developing innovative therapies for life-threatening diseases. Its medicine portfolio includes treatment for conditions ranging from HIV and hepatitis to coronavirus and cardiovascular disorders. If we talk about its financial performance, the bio-pharmaceutical company recently crushed expectations for the third quarter. It posted adjusted earnings of $2.65 per share on revenue of $7.42 billion for the quarter ended September 30. The results easily beat the consensus forecast of $1.76 per share for earnings and $6.29 billion for revenue. If we look at its key financial metrics, Gilead stock is currently trading around $67.48 against its 52-week range of $56.56 – $73.34. Moreover, its P/E value is 11.55, while the company’s total market value is just over $84 billion. US Steel Materials, Small Cap, 0.77% Dividend, Our Grade = A- Free Reports: Get Our Free Metatrader 4 Indicators - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis. United States Steel Corporation (NYSE: X), founded in 1901, is one of the leading steel producers in the U.S. The strong demand for steel helped the company post better-than-expected financial results for the third quarter. United States Steel reported adjusted earnings of $5.36 per share for the three months ended September 30, beating expectations of $4.85 per share. Quarterly revenue of $5.96 billion also surpassed the consensus forecast of $5.79 billion. If we look at the recent price movement, United States Steel stock has gained more than 50 percent value so far in 2021. The 52-week range of the stock is $10.72 – $30.57, while the total market value of the company is approx. $7 billion. Seagate Technology Information Technology, Medium Cap, 3.18% Dividend, Our Grade = A- Seagate Technology Holdings plc (NASDAQ: STX) is one of the world’s biggest hard disk drives (HDDs) makers. It still generates a large portion of its revenue by selling traditional HDDs. The company last month announced better-than-expected financial results for its fiscal first quarter, driven by solid demand from cloud data center clients. Seagate reported adjusted earnings of $2.35 per share on revenue of $3.12 billion for the three months ended October 1, while analysts were looking for earnings of $2.21 per share on revenue of $3.11 billion. The impressive financial performance drove Seagate stock higher in recent weeks. Seagate stock is now up nearly 80 percent on a year-to-date basis. Synchrony Financial Financials, Medium Cap, 1.68% Dividend, Our Grade = A- Synchrony Financial (NYSE: SYF) has vast experience in the financial sector. It is one of the biggest credit card issuers in the U.S., working with hundreds of retailers to support their credit card plans. The company last month announced a solid profit for the third quarter. Synchrony reported earnings of $2 per share, significantly higher than 52 cents per share in the comparable period of 2020 and better than the consensus forecast of $1.52 per share. If we see its recent price trend, Synchrony has grown its value at a decent pace so far in 2021. The company’s share price has increased about 47 percent on a year-to-date basis. The 52-week range of the stock is $29.32 – $52.49, while its P/E ratio stands at 7.10. Lazard Ltd Financials, Small Cap, 3.98% Dividend, Our Grade = A- Lazard Ltd (NYSE: LAZ) specializes in financial advisory and asset management services. It mainly advises clients on mergers and acquisitions (M&A), capital structure, and restructuring plans. It has advised on some of the biggest and most complicated M&A deals of the last century. If we look at its financial performance, Lazard posted mixed results for the third quarter. Its earnings of 98 cents per share exceeded the expectations of 95 cents per share. However, the quarterly revenue of $702 million missed analysts’ average estimate of $715 million. Lazard stock traded mostly lower following the results. Nevertheless, the company’s share price is still up nearly 15 percent on a year-to-date basis. By InvestMacro – Be sure to join our stock market newsletter to get our updates and to see more top companies. All information, stock ideas and opinions on this website are for general informational purposes only and do not constitute investment advice.
PRIMEXBT: A REVIEW

PRIMEXBT: A REVIEW

Prime XBT Prime XBT 18.11.2021 14:45
Cryptocurrency traders are always seeking to top the trading list despite the competition. Most of these crypto traders have features that place them above others. One of such is PrimeXBT. The goal of the cryptocurrency marketers is to maximize sales, assets, and profits. Some exclusive features make PrimeXBT outstanding among other cryptocurrency platforms. These features also set the trading platform as an unequaled competition. The purpose of this article is to clarify, review, and educate readers on some of the significant characteristics of PrimeXBT that are distinct to others. After reading this article, you will be able to decide whether or not to sign up on PrimeXBT. WHY PRIMEXBT PrimeXBT is a bitcoin-based trading platform. It is also an award-winning platform for excellent service and creating the best crypto trading margin. The platform offers exchanges in stock indices, commodities, forex, and cryptocurrencies with up to 1000 times leverage. Below are some of the unique qualities and benefits that PrimeXBT offers. · Registration is easy and speedy on the platform. · Hassle-free withdrawals are based on bank-grade and address whitelisting. · Reliable, technical software · Leverage up to 100 times on commodities, crypto, and stock indices. · Gold, Forex, Silver has about 1000 times leverage. · Secured and fantastic trading engine · PrimeXBT has the option to stop loss and take profit. · A demo account is available for free. · Customer service is open for all live chats 24 hours, 7 days a week. · Learning materials are also available. · The trading platform has updated and new tools for crypto trade. The above-mentioned characteristics and factors make PrimeXBT a highly recommendable trading platform for new crypto traders. All these benefits also make the PrimeXBT attractive, satisfactory, reliable, and remarkable for experienced crypto traders. HOW TO GET STARTED PrimeXBT has the simplest registration process. Registration on PrimeXBT is easy and fast. You will be required only to give a valid email address and your country of residence. From there, you would be asked to proceed to confirm your email address. You will need to have a username and a secret code to enable you to log in another time. Once you have completed the registration process, you can proceed to make your initial deposit. HOW TO MAKE DEPOSITS PrimeXBT only allows payments to a BTC address. Bitcoin is the only cryptocurrency for all registered accounts. The minimum deposit fee is 0.01 Bitcoin. Another means of the deposit is through a third-party channel called Changelly. All BTC deposits are immediately confirmed and converted to funds. You must transfer funds to your trading account upon deposit. Funds in the trading account will help you to save some capital separately for trading purposes. This is different from what you have in the trading account for margin. HOW TO MAKE WITHDRAWALS All withdrawals on PrimeXBT are processed once daily. Making withdrawal on PrimeXBT is also a simple process like the deposit. The system converts the Bitcoins to funds before you cash out. After that, the funds go to another BTC address. You may lose funds if you send them to other cryptocurrency exchange different from Bitcoin. The withdrawal window processes all withdrawals at once in a day on PrimeXBT. So, all pending withdrawals will wait until the rollover period. They will join the queue until the next rollover. All the payments from the platform are also officially addressed to the BTC addresses. TRADING ON PRIMEXBT Trading on PrimeXBT is subject to customers' preferences. The trading terminals are developed with excellent built-in software. They have a good number of trading indicators that include SAR, RSI, Ichimoku, and Parabolic, among others. All trading terminals are customized to suit the traders' satisfaction. The trading terminal has a good number of widgets like watch lists and charts. The reliability of the trading engine accounts to about 99.9%, which is known to be fast and error-free. Traders are positioned to enjoy maximum profit irrespective of market turnout. Traders can increase their profits and reduce all risks with the stop loss and take profit orders available on the platform. ASSETS There are about 50 distinctive traditional and digital assets that PrimeXBT offers. These assets create several means of making a profit on PrimeXBT, unlike other rival trading platforms. They include: · Different cryptocurrencies. For example, Bitcoin, Ripple, and Etherum. · Valuable metals. Gold and Silver. · Commodities. WTI Crude Oil, Natural gas, Brent. · Stock Indices and CFDs. Examples are ASX 200, S&P 500, and DAX 30. · Forex currencies. Like AUD, USD, JPY, etc. Considering the cryptocurrency trading market, PrimeXBT has the most attractive and exceptional value assets. REFERRAL Referrals on the platform also generate commissions for traders. Traders who refer customers to the site can generate up to 50 BTC. Traders who are on the leaderboard of the referral chain can even generate over 50 BTC. As the referral increases, the commission increases as well. The referral level and commission grow as each referred trader refer to other traders the platform. The trader who makes the first referral can benefit up to four levels of commission based on the growth of the chain. PrimeXBT also uses CPA offers for its traders. A trader can also enjoy ambassador relationships and personal customer agents as they continue to refer more clients to the platform. CUSTOMER CARE Through an online chat on a daily and weekly basis, customer service agents are available on PrimeXBT. They also give other help center guides, regular updates, and information through their blog. PrimeXBT also has social media platforms that are open to receiving customers' complaints and requests. The customer care representatives are trained and prepared to give any assistance needed to use the platform. SECURITY A secured transaction is one priority of PrimeXBT, which is why they take extensive measures to prevent the security threat of any trading account. PrimeXBT uses Cloudflare technology to ensure the security of all trading on its platforms. All withdrawal accounts are whitelisted and encrypted. The accounts are protected with two-step authentication. One way to test the security level of PrimeXBT is that no personal information is required. The simple step to register is to supply a valid email address, country of residence, create a username, and create a password. TURBO The company recently introduced a new and fantastic trading tool called Turbo. It is also a BTC trading platform with a slight difference from Prime XBT. Turbo works for short-term and synthetic Bitcoin transactions. Traders can select and book for any contract from 30 seconds, a minute or five minutes UP, and DOWN contract. They also order either a profit or loss contract with the new Turbo tool. This new tool is an innovative and exciting trend that makes PrimeXBT unrivaled. CONCLUSION PrimeXBT has won several awards like the ADVFN as the Best Bitcoin Margin Trading Platform. The platform also provides highly competitive features for its traders.  All these are summed in the extremely-fast registration process, rewarding tools, and a wide selection of modern and conventional assets.  If you are keen and concerned about secured and reliable cryptocurrency trade, PrimeXBT is a recommendation for you. PrimeXBT has the best, fast, and profitable assets and cryptocurrency trading. Study all the training tools available and register a free trading account on PrimeXBT to get started.
Agriculture rally resumes led by coffee, wheat and sugar

Agriculture rally resumes led by coffee, wheat and sugar

Ole Hansen Ole Hansen 18.11.2021 16:35
Summary:  The cost of your breakfast and food in general continues to rise, and following a few months of sideways trading, the Bloomberg Agriculture index, which tracks a basket of major food commodity futures, reached a fresh five-year high this week. Apart from troubled weather reducing available supply there are several other reasons playing a their part and in this update we take a look at some of those, including the reasons why coffee and wheat are two of the hottest food commodities this year. The cost of your breakfast and food in general continues to rise, and following a few months of sideways trading, the Bloomberg Agriculture index, which tracks a basket of major food commodity futures, reached a fresh five-year high this week. The table below shows the commodities with the biggest impact this year has been led by coffee, edible oils, wheat and sugar. There are individual reasons behind the strong gains, but what they all have in common has been a troubled weather year, a post pandemic jump in demand leading to widespread supply chains disruptions and more recently rising production costs via surging fertilizer prices and rising cost of fuels, such as diesel. The La Ninã weather pattern which can lead to floods, drought and cooler temperatures around the world returned to haunt producers this year, and recent forecasts say it will prevail through the coming northern hemisphere winter. In large swathes of South America and parts of North America a La Ninã is normally accompanied by drought, whereas in Australia and parts of Southeast Asia it is often resulting in heavy rainfall. Fertilizer prices have skyrocketed during the past few months as a result of soaring natural gas prices which have forced some European production plants to halt or reduce production. Fertilizer indices tracking prices in North America and Western Europe both trades more than 200% above their five-year averages. The surge has raised concerns farmers may reduce their usage of fertilizers or shift more acres into crops that require less nutrients. A drop in yields could drive prices even higher, thereby worsening already strong food inflation. Supply chain problems/disruptions: We are all familiar with stories about port congestion, lack of containers and surging prices on all the major routes around the world, especially from the production hub in Asia to major ports in Europe and the U.S. These problems began as a result of the pandemic which initially drove a major amount of order cancellations before the world a few months later went on a massive spending spree for consumer goods as the service sector grinded to a halt. These developments together with port disruptions due to continued Covid outbreaks helped trigger disruptions that to this day continue to cause problems for shippers of goods, including many of the food commodities that are transported in special containers. Arabica coffee trades at a nine-year high at $2.38 per pound with the supply outlook looking increasingly tight following an annus horribilis in Brazil where frost and drought dealt a blow to the 2021 crop. In addition to weather, the market also had to deal with lack of shipments and high container rates, surging fertilizer prices and roasters in Europe struggling to source supplies from alternative producers in Columbia and Vietnam. If that wasn’t enough, there is now also a growing risk of civil war in Ethiopia, the world’s third biggest grower of the Arabica bean. What may prove to be even worse over the coming months is that the flowering, or lack of, for the 2022 on-season crop is pointing to another low production year. The break above $2.25, the 2014 high may signal a market running towards $3, a record level that was last seen in 2011. Wheat: From a global food security perspective, the ongoing rally in global wheat prices is an even bigger concern. This week we have seen Chicago wheat futures climb to their highest level in nine years, while here in Europe, the benchmark Paris Milling Wheat contract trades just below €300 per tons, its highest price ever. Just like coffee, weather worries are the main driver, following a poor harvest in North America together with a year-on-year decline in exports from Russia, the world’s largest shipper. These developments have triggered increased demand for European sourced wheat, and with the prospect of another potentially challenging crop year in 2022 caused by weather and high fertilizer costs, some of the major importers have recently been stepping up their pace of purchase in order to cool local food prices, and to secure supplies ahead of winter. With buyers increasingly competing for supplies the market will look for some relief from the upcoming and promise-looking harvests in Argentina and Australia, taking place from now until January. One of the most actively traded ETF tracking the agriculture sector, the Invesco DB Agriculture Fund, broke higher last week to reach a four-year high. The index tracks the performance of 11 major futures markets spread across grains, softs and livestock. Source: Saxo Group
Investors Expect High Inflation. Golden Inquisition Ahead?

Investors Expect High Inflation. Golden Inquisition Ahead?

Arkadiusz Sieron Arkadiusz Sieron 18.11.2021 15:33
  Inflation expectations reached a record high. Is gold preparing a counterattack to punish gold bears? In a , nobody expects the Spanish inquisition. In the current marketplace, everyone expects high inflation. As the chart below shows, the inflation expectations embedded in US Treasury yields have recently risen to the highest level since the series began in 2003. Houston, we have a problem, an unidentified object is flying to the moon! The 5-year breakeven inflation rate, which is the difference between the yields on ordinary Treasury bonds and inflation-protected Treasuries with the same maturity, soared to 2.76% on Monday. Meanwhile, the 10-year breakeven inflation rate surged to 3.17%. The numbers show the Treasury market’s measure of average CPI annual inflation rates over five and ten years, respectively. The chart is devastating for the Fed’s reputation if there’s anything left. You probably remember how the US central bank calmed investors, saying that we shouldn’t worry about inflation because inflation expectations are well-anchored. No, they don’t! Of course, the current inflation expectations oscillate around 3%, so they indicate that the bond market is anticipating a pullback in the inflation rate from its current level. Nevertheless, the average of 3% over ten or even just five years would be much above the Fed’s target of 2% and would be detrimental for savers in particular, and the US economy in general. I’ve already shown you market-based inflation expectations, which are relatively relaxed, but please take a look at the chart below, which displays the consumer expectations measured by the New York Fed’s surveys. As one can see, the median inflation expectations at the one-year horizon jumped 0.4 percentage point in October, to 5.7%. So much for the inflation expectations remaining under control!   Implications for Gold Surging inflation expectations are positive for the gold market. They should lower real interest rates and strengthen inflationary worries. This is because the destabilized inflation expectations may erode the confidence in the US dollar and boost inflation in the future. So, gold could gain as both an inflation hedge and a safe haven. And, importantly, the enlightened Fed is likely to remain well behind the curve in setting its monetary policy. This is even more probable if President Biden appoints Lael Brainard as the new Fed Chair. She is considered a dove, even more dovish than Powell, so if Brainard replaces him, investors should expect to see interest rates staying lower for longer. So, inflation expectations and actual inflation could go even higher. Hence, the dovish Fed combined with high inflation (and a slowdown in GDP growth) creates an excellent environment for gold to continue its rally. After all, the yellow metal has broken out after several months of consolidation (as the chart below shows), so the near future seems to be brighter. There are, of course, some threats for gold, as risks are always present. If the US dollar continues to strengthen and the real interests rebound, gold may struggle. But, after the recent change, the sentiment seems to remain positive. Anyway, I would like to return to the market-based inflation expectations and the famous Monty Python sketch. With an inflation rate of 3%, which is the number indicated by the bond market, the capital will halve in value in just 24 years! So, maybe it would be a too-far-reaching analogy, but Monty Python inquisitors wanted to use a rack to torture heretics by slowly increasing the strain on their limbs and causing excruciating physical pain (luckily, they were not the most effective inquisitors!). Meanwhile, inflation hits savers by slowly decreasing the purchasing power of money and causing significant financial pain. With the inflation rate at about 6%, hedging against inflation is a no-brainer. It’s a matter of financial self-defense! You don’t have to use gold for this purpose – but you definitely can. After several disappointing months, and the lack of gold’s reaction to inflation, something changed, and gold has managed to break out above $1,800. We will see how it goes on. I will feel more confident about the strength of the recent rally when gold rises above $1,900. 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
Like Clockwork

Like Clockwork

Monica Kingsley Monica Kingsley 18.11.2021 15:44
S&P 500 took a little breather, and sideways trading with a bullish slant goes on unchecked. Credit markets have partially turned, and I‘m looking for some risk appetite returning to HYG and VTV. Any modest improvement in market breadth would thus underpin stocks, and not even my narrow overnight downswing target of yesterday may be triggered. The banking sector is internally strong and resilient, which makes the bulls the more favored party than if judged by looking at the index price action only. Consumer discretionaries outperformance of staples confirms that too. When it comes to gold and silver: (…) Faced with the dog and pony debt ceiling show, precious metals dips are being bought – and relatively swiftly. What I‘m still looking for to kick in to a greater degree than resilience to selling attempts, is the commodities upswing that would help base metals and energy higher. These bull runs are far from over – it ain‘t frothy at the moment as the comparison of several oil stocks reveals. Precious metals dip has been swiftly reversed, and it‘s just oil and copper that can cause short-term wrinkles. Both downswings look as seriously overdone, and more of a reaction to resilient dollar than anything else. In this light, gold and silver surge is presaging renewed commodities run, which is waiting for the greenback to roll over (first). And that looks tied to fresh debt issuance and debt ceiling resolution – Dec is almost knocking on the door while inflation expectations are about to remain very elevated. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 bulls continue holding the upper hand, and yesterday‘s rising volume isn‘t a problem in the least. Dips remain to be bought, and it‘s all a question of entry point and holding period. Credit Markets Credit markets stabilization is approaching, and yields don‘t look to be holding S&P 500, Russell 2000 or emerging markets down for too long. Especially the EEM performance highlights upcoming dollar woes. Gold, Silver and Miners Gold and silver decline was promptly reversed, and the lower volume isn‘t an immediate problem – it merely warns of a little more, mostly sideways consolidation before another push higher. PMs bull run is on! Crude Oil Crude oil bulls could very well be capitulating here – yesterday‘s downswing was exaggerated any way examined. Better days in oil are closer than generally appreciated. Copper The copper setback got likewise extended, and the underperformance of both CRB Index and other base metals is a warning sign. One that I‘m not taking as seriously – the red metal is likely to reverse higher, and start performing along the lines of other commodities. Bitcoin and Ethereum Bitcoin and Ethereum bears may be slowing down here, but I wouldn‘t be surprised if the selling wasn‘t yet over. We‘re pausing at the moment, and in no way topping out. Summary S&P 500 bulls keep banishing the shallow correction risks, leveling the very short-term playing field. The credit markets non-confirmation is probably in its latter stages, and stock market internals favor the slow grind higher to continue. Precious metals remain my top pick over the coming weeks, and these would be followed by commodities once the dollar truly stalls. 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.
Euro Bounces Back, but The Turkish Lira Remains Unloved

Euro Bounces Back, but The Turkish Lira Remains Unloved

Marc Chandler Marc Chandler 18.11.2021 15:17
Overview:  The US dollar's sharp upside momentum stalled yesterday near JPY115 and after the euro met (and surpassed) a key retracement level slightly below $1.1300.  Led by the Antipodean currencies today, the greenback is mostly trading with a heavier bias.  Among the majors, helped by a steadying of US yields, the yen is soft.  In the emerging market space, the Turkish lira continues its headlong plunge while the yuan softened and the Mexican peso is off.  Hungary's central bank surprised with a 70 bp hike in the one-week deposit rate.  The JP Morgan Emerging Market Currency Index is posting a small gain through the European morning.  Disappointing tech results in China (Baidu and Bilibili) weighed on Chinese shares, but most markets in the region fell but Australia and Taiwan.  Europe's Stoxx 600 is struggling to extend the six-day advance.  US futures are also a little firmer.  After yesterday's four basis point pullback, the US 10-year yield is little changed near 1.58%.  European yields are 1-2 bp lower.  Gold remains within Tuesday's range (~$1850-$1877), but the moment seen earlier last week has faded, and the yellow metal is trading choppily in a consolidative phase.  The prospect of a coordinated sale of oil after China's announced it would tap its reserves for the second time saw the January WTI contract fall to $76.45, its lowest level since early October. Still, the price has stabilized in the European morning around $77 a barrel.  The benchmark European natural gas contract (Netherlands) has extended yesterday's pullback.  It settled a little below 75 euros last week, and after two days of declines, it is above 92 euros.  Iron ore is also falling for a second session and is now lower on the week.  Note that it settled October a little above $104 and is now around $86.40. Copper is lower for the fourth consecutive session.  It is trading around $424, off $20.5 this week.   Asia Pacific  Japan is expected to unveil the much-awaited supplemental budget tomorrow.  Prime Minister Kishida will get one bite of the proverbial apple, and he is expected to go big.  Talk of the size of the overall package has risen in recent days.  The Nikkei seemed to suggest a JPY79 trillion (~$690 bln) effort, while others report something on the magnitude of JPY56 trillion.  Still, it is recognized that part of the budget will include funds that were earmarked under previous budgets, which have not been spent.  The clear water is seen around JPY32 trillion.  Japan is one of the few countries that will provide new fiscal support.   New Zealand's central bank meets next week.  It is widely expected to hike rates for the second time in the cycle.   The swaps market has 200 bp of tightening priced in for the next 12 months.  The cash rate stands at 50 bp.  Earlier today, the central bank reported that the two-year inflation expectations (business survey)  rose to 2.96% in Q4 from 2.27% in Q3.  It is the highest in a decade.  The one-year expectation rose to 3.7% from 3.02%.  Still, with other countries slower to raise rates, a 50 bp move may not be necessary.  The Kiwi rose almost 4% last month and has given back nearly half so far in November.  Separately, the Philippines and Indonesia central banks met and left rates steady as expected.   The dollar posted a key reversal against the yen yesterday.  It made a new high for the move, a few pips below JPY115.00, and proceeded to sell-off and close (slightly) below Tuesday's low.  However, follow-through selling has been limited, and the greenback is trading firmly but may be absorbing sales related to the $1.34 bln in options in the JPY114.20-JPY114.25 area that expire today.  The Australian dollar initially extended its losses to almost $0.7250, where a A$575 mln option expires today. However, since early in the Asian session, it has posted corrective upticks and looks set to challenge yesterday's high and five-day moving average a little above $0.7300.   The Chinese yuan appears to have begun consolidating.  It remains in the range set on Tuesday that saw the dollar trade roughly between CNY6.3670 and CNY6.3965.  The small gain is the third this week.  The PBOC fix was at CNY6.3803, a bit firmer compared with expectations (CNY6.3786 in the Bloomberg survey) than seen recently.  Note that there is a $1 bln option at CNY6.3830 that expires today.   Europe The auto industry in Europe remained under pressure last month, though the US reported its first increase in sales in six months.  New car registration in Europe, including the UK, is a proxy for sales.  They tumbled by slightly more than 30% year-over-year in October.  This is considerably weaker than expected and is the poorest since May 2020.  The shortage of semiconductors is the likely culprit, and there are some signs of improvement.  The EC will propose modest tweaks in rules about how funds outside of its borders (UK) can be managed while avoiding more dramatic changes.   Draft proposals call for at least two full-time senior managers in the EU and for regulators to be notified when most of their assets are managed outside the EU.  These seem quite minor and unlikely to disrupt the UK fund business.  Earlier this month, the EU Commissioner for Financial Services indicated that temporary waivers would be granted to allow EU banks and money managers to clear trades in the UK. Meanwhile, the dispute over fishing appears to be worsening (Denmark complaining, not just France), and the UK continues to threaten to invoke Article 16.  Former Prime Minister Blair says he will propose a solution to the dispute over the Northern Ireland Protocol in the coming days.  Hungary delivered a 30 bp hike in the base rate earlier this week, which now stands at 2.10%.  It warned that it could make a separate decision on its one-week deposit rate.  It did so today, hiking it 70 bp to 2.50%.  It is a hawkish move that sent the forint higher.  Separately, as widely expected, the Central Bank of the Republic of Turkey cut the one-week repo rate 100 bps to 15%. As a result, the lira is weaker for the eighth consecutive session.  The lira's weakness not only fuels inflation but also will challenge companies and banks with foreign exchange exposure.  The dollar finished last month near TRY9.60 and after the rate hike, pushed above TRY10.97 before stabilizing.   The euro overshot the (61.8%) retracement target of the rally that took it from near $1.0640 in March 2020 to high on January 6, around $1.2350.  That retracement target was about $1.1290, and the euro fell to around $1.1265 yesterday. It recovered to new session highs early in North America yesterday (~$1.1330), leaving bullish hammer candlestick, and follow-through buying lifted it to $1.1345 today.  The combination of higher inflation and stronger retail sales this week have helped sterling to recover.  It had traded near $1.3350 at the end of last week and has barely traded below $1.34 this week.  Indeed, sterling is rising today for the fifth consecutive session, the longest advance in nearly seven months.  It poked above $1.35, where an option for about GBP345 mln will expire today.  A convincing move above $1.3515 could signal another cent advance.  The euro slipped to below GBP0.8385 today before recovering.  It is testing the GBP0.8400, which holds options for 1.1 bln euros that also expires today.   America Leave aside the gaffes by President Biden over Taiwan.  Bloomberg counts four such verbal blunders that have required official walk back or explanation or clarification.  Reports indicate that Biden probed Xi about oil sales.  China has intervened in the commodities (industrial metals) and crude oil market recently.  Today it indicated it will provide more oil from its strategic reserves.  The September is action 7.1 mln barrels, according to reports, and privately sold more.  It is unclear whether today's sales were planned or grew out of the "virtual summit."  Still, it puts the ball back into the US court.  If the US does not sell or lend oil from its strategic reserves, it will look bad after China's move.  On the other hand, its own agency (EIA) projects that it may not be needed as oil will be in oversupply shortly.  Moreover, the pain for consumers is coming from gasoline prices, not oil per se.  Drawing down strategic reserves may not help the gasoline market.  Apparently, Japan has been approached by the US about coordinating the release of oil, though Europe was not.  The US reports weekly initial jobless claims today.  They have fallen for six consecutive weeks, and at 267k, it is the lowest since the pandemic struck.   That said, at the end of 2019, there were below 220k.  The Philadelphia and Kansas City Feds publish their November survey results.  Both surprised last month, with the former on the downside and the latter on the upside.  This time it may be the other way around, with the Philly survey showing strength and the KC survey softer.  Canada reports its monthly portfolio flow data ahead of tomorrow's retail sales report.  Mexico and Brazil have light economic calendars.   Canada's Prime Minister Trudeau and Mexico's President AMLO visit Washington today for the North America's Leaders Summit.  There is tension among the "three amigos."  The Build Back Better US initiative contains several elements that favor American producers. A key one is that substantial tax break for Americans buying electric vehicles if they are made in the US.  This would seem to put Canada and Mexico at a disadvantage, given the integration of the auto sector on a continental basis. Mexico and Canada are also concerned that the Biden Administration's interpretation of the domestic content requirement in the USMCA treaty is also narrow and puts them at a disadvantage.   Canada is also concerned about the pipelines after Biden nixed the Keystone Pipeline in one of his first acts in office, and the Line 5 pipeline is being challenged by Michigan.  The US, and to a less extent, Canada, is worried about the efforts by AMLO to increase the power of the state sector energy companies (oil and electricity), deterring private sector efforts.  The US may try pressing against this on environmental grounds.  Climate and immigration are reportedly on the top of today's agenda.  The US dollar reversed higher against the Canadian dollar on Tuesday, posting an outside up day.  Follow-through buying yesterday lifted the greenback a little above CAD1.2620.  It ticked ever so slightly higher today but has come back offered.  Support is seen in the CAD1.2555-CAD1.2575 area.  The $1.04 bln option at CAD1.25 that expires today is too far away to be impactful. Meanwhile, the US dollar remains within Tuesday's range against the Mexican peso (~MXN20.56-MXN20.85).  This range looks set to hold today.   Disclaimer
A GUIDE TO PRIMEXBT VERSION 2.0

A GUIDE TO PRIMEXBT VERSION 2.0

Prime XBT Prime XBT 18.11.2021 17:27
 Just recently, PrimeXBT released an upgraded version, called the V2.0. This version brought about nothing short of a revolution to the trading platform, including greater access to the platform, improved interface, and enhanced visuals. V2.0 also supports Ethereum (ETH) and digital currency-based margin accounts. This is a guide to everything you should know about PrimeXBT V2.0, and all the upgrades you find on this trading platform, including the USDT, USDC, and ETH margin accounts. INTRODUCTION TO PRIMEXBT V2.0 When you visit PrimeXBT's website, you will get a welcome message if it is your first visit since the upgrade. Do a quick read of the new additions and features noted in the text. The dashboard, which has been upgraded and reorganized, consists of the main account from where you can view your margin accounts, Covesting details, available wallets, account followings, and other relevant details. VERSION 2.O MAIN PAGE AT A GLANCE You have all relevant information immediately you hit the main page, including how to make a withdrawal, deposit, or check your balance.  From the main page, you can deposit funds, make withdrawals, monitor your balance, and do so much more. You can also set up a different account for ETH, USDT, and BTC right from the main page. Funding your account is swift and easy; it starts by depositing funds to all your crypto addresses connected to your dashboard. The next step is to move your crypto deposit from your wallet to all the margin accounts you want to send it. INTRODUCING NEW FEATURES: USDT, USDC, AND ETH ACCOUNTS AND CURRENCIES Do you know what's hot? It is a fact that users now have more options apart from the Bitcoin margin trading that makes PrimeXBT famous. Once you're logged in, you can trade using new currencies like USD Coin, Ethereum, or Tether. PrimeXBT has everything in place for smooth operations as the upgrades and additions are well integrated into the accounts, site infrastructure, and trading engine. New Signings to PrimeXBT can enjoy all these features when they set up a free account and begin trading with little deposit. A GUIDE TO TRADING WITHIN MARGIN ACCOUNTS ON PRIMEXBT V2.0 With V2.0, you can trade with separate account details for each of your margin accounts. You can also trade with any CFD available on PrimeXBT V2.0., including stock indices, forex, commodities, crypto, and about 46 others.   BREEZE THROUGH ACCOUNTING AND TAX REPORTING WITH THE NEWLY-ADDED REPORTS SECTION A visit to the report section newly added to the V2.0 PrimeXBT website holds in-depth account information, including transaction history, basic account details, and movement of funds. All these features will make it easier to keep up with tax and other accounting activities. GET NEW USERS TO PRIMEXBT AND GET REFERRAL BONUSES WITH NEW CURRENCIES  If you have been referring users to PrimeXBT or you have plans of starting, there's a currency tweak you should know. The referral site has undergone some updates, particularly the addition of those new currencies. When you refer a person to PrimeXBT, you will receive your commission in the trading currency that the new user chooses to use in their trade. You can share PrimeXBT referral links on social media groups and amongst friends and family. If you leverage these links, you can get more revenue apart from your trading profit. You can get as much as 20% on commission when you leverage PrimeXBT's referral system. V 2.0 COVESTING COPY TRADING GOT REALLY SMOOTH If any section was left out of the upgrade, it wasn't the covesting module, which got upgraded to support USDT, ETH, and USDC, alongside the exiting Bitcoin trading currencies. 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It’s the most important job in finance...

It’s the most important job in finance...

Chris Weston Chris Weston 19.11.2021 08:03
It’s the most important job in finance, but the focus falls on whether Jerome Powell, whose term as Fed Chair expires in Feb 2022, is reappointed or whether he is replaced by Lael Brainard, or perhaps even Raphael Bostic. The earlier talk was this decision was slated before Thanksgiving (25 Nov), but the WSJ reported this week that the nomination could be announced over this weekend. The question then of gapping risk for the Monday open is one traders should consider. As the well-used term goes, markets hate uncertainty – and a Brainard appointment, at a time of impending monetary policy change, represents a small rise in uncertainty that many in the market could do without – well, except for those who like volatility which is most short-term traders. A wild December Still, my base case is we are headed into a period of higher volatility regardless, with a wild December ahead of us. Where we see the US Treasury exhausting measures by mid-December and the US debt ceiling potentially becoming problematic, just as the FOMC meeting (16 Dec) sees the central bank likely announce they are accelerating the pace of tapering from $15b to $20-$25b. Expectations of volatility from the Fed meeting should increase after the Nov non-farm payrolls (4 Dec) and then the Nov CPI print (11 Dec) – the latter a genuinely market-moving event. With the Fed due to ramp up the pace of tapering and potentially closing out its QE program far earlier than prior calls for mid-2022, it sets us up for the Fed to start hiking in July or August. The markets currently price just over two hikes over the coming 12 months. Is this the time to change captain? The concern the market naturally holds then is whether this is really the time to be changing the captain of the ship when we’re charging towards choppy waters? And, if the public have such great disdain for inflation - and US inflation is only getting hotter - why replace Powell with someone who most know is slightly more dovish? Brainard, in some market participants minds, could further slow the reaction function of the Fed and rising talk of the Fed being “behind the curve” could see volatility rise. OK, we know Brainard is a Democrat, and we know she is genuine Fed chair material, but when inflation is probably the number one point of contention and the Mid-term elections is in our sights, surely it makes little sense to allow inflation to run even hotter. A Brainard appointment may change the focus to one where the employment mandate is aimed at a greater inclusion – so, despite the headline employment rate headed to 4% in Q1 22, there could be a shift towards more targeted groups and at a simplistic level that could mean keeping rates lower for longer. In some eyes, when inflation is running hot, not just through supply-side issues, but through demand and wages, then rates simply need to go higher, and Powell is more likely to address this sooner. I am not so sure I share the market’s concerns, and I feel Brainard would be no less dovish than Powell, but this is a widely held view in certain circles. Betting sites have Powell as the firm favourite We can see the odds of Brainard getting the gig have beefed up after what was seen as a very positive meeting with the President recently. And we know there have been calls for change at the helm given the recent spate of controversial trading cases at the Fed. While progressives want tougher financial regulation and a Fed that can use policy to address climate change. Despite Brainard’s odds increasing, the market is clearly leaning that Powell gets a second term, and for what it’s worth, I think he should get the gig. The betting markets have Powell as chair at 76% (69% on Predicit) and that is fair, but there is a non-immaterial chance that we do see Biden nominate Brainard, so it certainly needs monitoring. If Lael Brainard does get nominated then the first place to look is short-term US Treasuries, and I’d expect 2-year yields to fall 3-4bp. If yields drop then the USD should follow, especially vs higher beta plays (AUD, NZD, MXN), while we may see some selling in US500 and US2000, with outperformance seen in the NAS100. Gold would probably find buyers and may even take out the recent highs of $1870. Given recent moves in rates and the bull move in USD, I’d argue the market is strongly leaning on a Powell reappointment, so news of him getting the gig may cause limited moves on open – if we do indeed see it announced this weekend. Still, it’s a risk to monitor – but the real issue remains to navigate the event risk in December in what is typically a period of lower participation.
Monthly Macro Outlook: The transitory narrative continues to fall apart

Monthly Macro Outlook: The transitory narrative continues to fall apart

Christopher Dembik Christopher Dembik 19.11.2021 09:25
Summary:  The economist consensus anticipates inflation will start falling from early next year. We disagree. We consider the market to be too complacent regarding upside risks to the inflation outlook. The great awakening of workers and the steady rent increase (for the United States) are two of the factors which are likely to maintain inflation uncomfortably high into 2022, in our view. October CPI figures released earlier this week confirm that inflationary pressures may last longer than initially expected. Inflation reached levels which have not been seen for decades in the United Kingdom (+4.2% YoY), in the eurozone (+4.1% YoY) and in Canada (+4.7% YoY). In Canada, the jump in inflation is the strongest recorded in 18 years. For now, investors are confident. They believe the U.S. Federal Reserve and European Central Bank’s narrative that inflation will start to fall from early next year. This is far from certain, in our view. From supply chain bottlenecks to energy prices, everything suggests that inflationary pressures are far from over. Expect energy prices to continue increasing as temperatures will drop in Europe from next week onwards. This will weigh on November CPI data which will be released next month. The peak in inflation has not been reached. We fear investors are too complacent regarding upside risks to the inflation outlook. Every economic theory says inflation will be above 2% next year : ·         The Phillips curve is alive and well : workers are demanding higher salaries, amongst other advantages and their expectations are rising. ·         Monetarism : the global economy is characterized by large deposits, desire to spend and to convert cash into real assets. ·         Commitment approach : the U.S. Federal Reserve (Fed) and the European Central bank (ECB) have a dovish bias. This is confirmed by their new inflation strategy (symmetric 2% inflation target over the medium term for the ECB and inflation of 2% over the longer run for the Fed). ·         Fiscal approach : high public debt and fiscal dominance (central banks need to remain dominant market players in the bond market to avoid a sharp increase in interest rates). ·         Supply-side approach : supply bottlenecks due to the zero Covid policy in China and central banks’ trade off higher inflation for a speedier economic recovery (the ECB especially). ·         Green transition : this is basically a tax on consumers. What has changed ? The wage-price spiral has started. In countries where the labor market is tight, workers are asking for higher salaries. In the United States, the manufacturer John Deere increased salaries significantly : +10% this year and +5% in 2023 and in 2025. It also agreed to a 3% bonus on even years to all employees, for instance. But this is happening in countries where the unemployment rate is high too. In France, the unemployment rate is falling. But it remains comparatively elevated at 7.6% in the third quarter. Earlier this week, the French Minister of Economy, Bruno Le Maire, called for higher salaries in the hospitality industry. A survey by the public investment bank BPI and the pro-business institute Rexecode show that 26% of small and medium companies are forced to propose higher salaries to find employees. Those which are reluctant choose to reduce business activity. The pandemic has fueled a great awakening of workers, in our view. They are demanding more : better job conditions, higher wages, more flexibility and purpose from work. This is more noticeable in countries facing labor shortage. But it is also visible in all the other developed economies to a variable extent.   U.S. steady rent increase is a game-changer. Until now, supply bottlenecks were the main driver behind the jump in prices. Now, housing costs (which represent about a third of living cost) and prices in the service sector are accelerating too. The rental market is tight, with low vacancy rates and a limited stock of available rentals. Expect rents to move upward in the coming months. According to official figures, owner’s equivalent rent, a measure of what homeowners believe their properties would rent for, rose 3.1% YoY in October. This certainly underestimates the real evolution of rents. Based on data reported by real estate agents at national level, the increase is between 7% and 15% YoY. All in all, this reinforces the view that inflationary pressures are proving more persistent than expected. The moment of truth : Expect investors not to question much the official narrative that inflation is transitory, for now. But if inflation does not decrease from 2022 onwards, investors will have to adjust their portfolio to an environment of more persistent inflation than initially anticipated. This may lead to market turmoil. In the interim, enjoy the Santa Claus rally which has started very early this year. The new inflation regime in the United States
Intraday Market Analysis – USD In Pullback Mode

Intraday Market Analysis – USD In Pullback Mode

John Benjamin John Benjamin 19.11.2021 09:15
USDCHF seeks support The US dollar stalled after weekly jobless claims came in higher than expected. The pair’s attempt above the daily resistance at 0.9310 suggests that the bulls may have gained the upper hand. Intraday buyers’ profit-taking led by the RSI’s overbought situation has caused a limited pullback. Buyers may see dips as an opportunity to get in at a discount. Bids could be around the resistance-turned-support at 0.9235. 0.9330 is a fresh resistance. And its breach may trigger an extended rally towards last April’s peak at 0.9450. NZDUSD bounces off demand area The New Zealand dollar inches higher as traders are positioning for an RBNZ rate hike next week. From the daily chart’s perspective, the pair has bounced off the demand zone near the psychological level of 0.7000. A bullish RSI divergence indicates a slowdown in the bearish momentum, a sign that sentiment could be turning around. An oversold RSI has attracted buying interest. A rally above 0.7060 would prompt sellers to cover, paving the way for a recovery towards 0.7175. A break below 0.6980 may drive the kiwi to 0.6900. US30 struggles to rally back The Dow Jones is under pressure as investors fear that inflation could choke off economic recovery. The index has been struggling to reclaim the landmark 36000, which coincides with the 20-day moving average. The faded rebound suggests exhaustion after a month-long breakneck rally. The RSI’s double-dip into the oversold area has attracted buying interest. Though buyers may stay cautious unless the first resistance at 36180 is lifted. On the downside, the previous peak at 35500 has turned into the next support.
Covid Wave Knocks Euro Down and to new 6-year Lows Against the Swiss Franc

Covid Wave Knocks Euro Down and to new 6-year Lows Against the Swiss Franc

Marc Chandler Marc Chandler 19.11.2021 13:58
Overview:  Concerns about the virus surge in Europe cut short the euro's bounce and sent it back below $1.1300 and are also weighing on central European currencies, including the Hungarian forint, despite yesterday's aggressive hike of the one-week deposit rate.  Austria has reintroduced a hard 20-day lockdown.  Germany's health minister warned that the situation deteriorated and vaccines were not enough to break the wave.  He was explicit that a lockdown cannot be ruled out.  The US dollar is trading broadly higher.  Only the yen is resilient on the day, but sterling is the only major currency that has edged higher this week.  The Scandis and euro are off more than 1%.  Speculation that Turkey may announce measures over the weekend to stabilize the lira may be helping to deter new sales today after yesterday's rout.  In the nine-day drop through today, it is depreciated by almost 15%.  The JP Morgan Emerging Market Currency Index is off for the fourth consecutive session to bring this week's loss to more than 2%, the most in five months.  Equities do not know of the consternation in the foreign exchange market.  Disappointing Alibaba results weighed on the Hang Seng (~-1%), while most other large regional bourses but Taiwan and India closed the week on an up note.   Europe's Stoxx 600 snapped a six-day advance yesterday. It was only the second loss since October.  It began firmer today but has reversed lower, putting at risk the six-week rally.   US futures are mixed, with the NASDAQ outperforming.  Bond markets are in rally mode as well.   The US 10-year yield is off three basis points to approach the week's low near 1.53%.  European bonds are off mostly 3-5 basis points, even in the UK, where retail sales surprised on the upside.  Gold is steady, finding support near $1850.  Oil initially extended yesterday's recovery but is reversing lower, leaving the January WTI contract set to test yesterday's low near $76.45.  This is the fourth consecutive weekly fall in crude oil.  European natural gas (Netherlands benchmark) is off 4.4% today, the third drop in a row, and pares the week's gain to almost 19%.  In Singapore, iron ore prices jumped 5.7% to break a five-week slide that saw prices tumble by about 28%.   Copper is firmer and paring this week's loss to around 2%.   Asia Pacific There were two developments in Japan to note.  First, October CPI was largely in line with expectations.  Surging gasoline prices (seven-year highs) helped keep the headline rate positive for the second month (0.1% year-over-year).  Excluding fresh food, the core rate was steady at 0.1%.  However, the deflationary forces are evident when fresh food and energy are removed.  The measure deteriorated to -0.7% from -0.5%, the most since June (-0.9%).    Second, Prime Minister Kishida unveiled an overall package of JPY78.9 trillion (~$690 bln). It is larger than the previous two pandemic packages. "Fiscal measures" refer to spending, investment, and loans, and this is seen worth about JPY55.7 trillion.  It is not clear yet, how much represents new spending as opposed to the reallocation of funds from earlier budgets that were not used. However, it appears to be about JPY32 trillion of new spending.   The Chinese yuan, up a modest 2.1% for the year, is the strongest currency.   Against a trade-weighted basket (CFETS), the yuan is pulling back from a six-year high set earlier this week as the euro recovers a cent.  Consider that the yuan has appreciated by more than 9% against the euro and 11.5% against the yen this year.  That means that investment in China has the same tailwind as the dollar and is compensated a bit for the relative lack of transparency and liquidity.  The Financial Times estimates that foreign holdings of Chinese bonds and stocks rose to around $1.1 trillion at the end of September, about a 13% increase this year.  China's stock market has underperformed this year, and the CSI 300 is off around 7% this year.  On the other hand, China's bonds have fared well.  It is the only 10-year bond that has not weakened this year.  China's figures show foreign direct investment has risen by almost 18% this year through October to nearly $142 bln.   The dollar is posting an outside down day against the Japanese yen by first rising above yesterday's high before reversing and taking out yesterday's low. It is approaching the week's low near JPY113.75 in the European morning.  Below there, support is seen around JPY113.60.  A break would warn of a return to JPY113.00.  The Australian dollar has been sold to its lowest level since October 6, when it recorded a low of almost $0.7225.   It has broken the trendline that connected the August and September lows (~$0.7250).  The September low was around $0.7170 and maybe the next important technical target.  The dollar is trading with a firmer bias against the Chinese yuan, but the greenback remains in the range set on Tuesday (~CNY6.3670-CNY6.3965).  The dollar gained on the yuan four sessions this week, the most since July, but the net gain of less than 0.2% still shows an extraordinarily steady exchange rate.   With the yuan near six-year highs against its trade-weighted basket (CFETS), the PBOC warned against one-way moves and encouraged financial institutions to bolster fx risk management.  It set the dollar's reference rate at CNY6.3825, slightly above expectations (Bloomberg survey) for CNY6.3822.   Europe The stronger than expected October retail sales capped the week's data that points to a rebounding economy and boosts the chances of a rate hike next month.  A strong jobs report was followed by a larger than expected rise in CPI and PPI.  Retail sales jumped 0.8% in October, and the September series was revised to flat from -0.2%. It was the first increase since April.  Pre-Xmas sales were reported.  Separately, the UK government reported that the cost of servicing the national debt has risen more than three-fold over the past year, leaving the budget deficit higher than anticipated.  It appears that the swaps market is pricing in a 15 bp hike at the December 16 BOE meeting, though some are talking about a bigger move.    Several ECB officials, including President Lagarde, have successfully pushed back against expectations of a 20 bp rate hike next year that had appeared discounted by the swaps market earlier this month. The market has pushed it into early 2023.  The implied yield of the December 2022 Euribor futures contract has fallen 20 bp this month.  The December 2022 Eurodollar futures contract is moving in the opposite direction.  The implied yield has risen by about 4.5 bp this month.  The net result is the US premium has increased to over 125 bp, the highest since last March.  In late 2019, the premium was around 180 bp.  This is recognized as a factor helping lift the dollar against the euro, and it appears to have become more salient recently.   The euro's bounce yesterday, its first gain in seven sessions (since the US CPI shocker), stalled near $1.1375, where a 780 mln euro option expires today.   The euro traded quietly in Asia before being sold aggressively as news of the virus hit the wires.  The euro traded through $1.1285 before catching a bid.  Resistance now will likely be encountered around $1.1320.  The euro is posting its first back-to-back weekly of more than 1% since March 2020.  Sterling is also sliding back toward the week's lows, just above $1.3400.  A break could signal a test on the $1.3350 area, but it appears stretched on an intraday basis.  While the euro-sterling cross is practically flat, the euro has punched below CHF1.05 for the first time in six years.  It would not be surprising to learn that the SNB has been intervening.  There appears to be little chart support until closer to CHF1.0250. America The nonpartisan Congressional Budget Office offered its evaluation of the Biden administration's Build Back Better initiative.  It sees $1.636 trillion in spending over the next decade and almost $1.27 trillion in revenue.  That leaves a deficit of $367 bln.  A notable difference between it and the administration is how much more revenue will be generated by increasing the number of IRS agents.  Even if it passes the House of Representatives, it will likely be marked up in the Senate.  The jockeying for position and spin around it will likely dominate the session, which sees no US economic reports outside of the rig count later today.  The Fed's Clarida and Waller speaker today.  It seems that most market participants still see the Fed behind the curve and disagree with our idea that to secure the ability to respond to a wide range of possible outcomes, the Federal Reserve may accelerate its tapering starting in January.   It is not clear exactly when the debt ceiling will be reached, but it is being played.  The Democrats do not want to lift it through the reconciliation process, though they have forced the Republicans to do so in the past.  The Republicans appear to have the discipline and will to oppose.  No one seems to think the US will really default, and getting even this close seems undignified.  Yet, the desire to avoid being caught out encouraged investors to demand a high yield on the four-week bill sold.  Yesterday's auction saw the yield more than double to 11 bp (annualized).  It is the highest yield since July 2020.  In contrast, the eight-week bill, which is thought to be beyond the shenanigans, yield slipped to 4.5 bp from six previously and a higher bid-cover ratio.   Canada reports September retail sales figures today.  After a 2.1% rise in August, some weakness is expected.  Ahead of it, the Canadian dollar is trading at new lows for the week, though it is faring better than the other dollar-bloc currencies.  The US dollar is approaching the (61.8%) retracement objective of the decline since the CAD1.29 level was tested on September 20.  The retracement level is near CAD1.2665, and a break would target CAD1.2700-CAD1.2750.  The upper  Bollinger Band is found near CAD1.2655 today.   The Mexican peso is also under pressure.  It, too, has fallen to a new low for the week today.  The greenback looks set to test the eight-month high set earlier this month near MXN20.98.  Note that the central bank's Deputy Governor warned that inflation was accelerating, and it could rise to 7% this month and 7.1%-7.3% next month.  In October, the CPI stood at 6.24% year-over-year.  Banxico meets next on December 16, the day after the FOMC meeting.  Lastly, we note that the Brazilian real is off for four consecutive sessions coming into today.  The dollar closed above its 20-day moving average against it yesterday and looks poised to probe above BRL5.60 today. The high for the month was closer to BRL5.70.   Disclaimer
Poland is doing well in the European warehouse race

Poland is doing well in the European warehouse race

Finance Press Release Finance Press Release 19.11.2021 14:06
From quarter to quarter, more and more warehouses are built in our country, resulting in Poland ranking second in Europe in terms of resources under construction. New players are also entering our market Despite the record-high amount of space under construction, new supply on the warehouse market in our country is not keeping up with the ever-growing demand. Lease volume recorded in the first half of this year, was three times larger than the amount of the commissioned space. The largest number of warehouses appeared in Upper Silesia, Warsaw and the Tri-City. The amount of warehouse space under construction is similar to the level of lease recorded in the first 6 months of this year. In the second quarter, the warehouse space under construction increased by a third compared to the previous quarter. According to Walter Herz, most logistics facilities remain in Upper Silesia, in Western Poland and in Poznan. A total of over 1.5 million sq m. of space is under construction in these three regions. The scale of the increase in warehouse resources ranks Poland second in Europe, after Germany. New investors The group of investors active on our market in the warehouse sector is also growing. Recently, Scandinavian fund NREP started its expansion in Poland, finalizing the purchase of logistics portfolio of 130 thousand sq m. of space and planning activities in the segment of warehouses and apartments. LCube company, after starting the investment in Jasionka near Rzeszow, recently launched its second warehouse project near Wroclaw. - Developers are also taking up speculative ventures today, because the demand for warehouses remains at a record high level. Recently, facilities in the area of city logistics have been very popular. Nevertheless, all segments of the warehouse market remain on the path of growth. The largest transactions are concluded by companies from the e-commerce sector, logistics operators are also invariably in high demand - informs BartÅ‚omiej Zagrodnik, Managing Partner/CEO of Walter Herz. - Market observers agree that the demand for warehouses in our country, as in Europe, will continue to grow. First of all, thanks to the forecasted, further increase in online sales and the development of e-commerce, as well as the expected expansion of tenants from the manufacturing industry - adds BartÅ‚omiej Zagrodnik. Emerging warehouse centers Warsaw remains the largest logistics hub in the country, where demand for warehouse space in 2020 reached 1.2 million sq m. and resources exceed 5 million sq m. The second, largest warehouse center in Poland is Upper Silesia, with stock reaching almost 4 million sq m. of space. The next position is occupied by the warehouse hub located in the central part of Poland, where approximately 3.3 million sq m. of space is located. Wroclaw and Poznan also belong to the group of the largest logistics centers. The potential of the largest warehouse markets in our country is constantly growing, but smaller logistics centers are also experiencing intense growth. The Tri-City, Szczecin and the center in Western Poland will join the centers offering over 1 million sq m. of warehouse space after the completion of the current construction projects. New warehouse investments are multiplying all over the country. In Lower Silesia, on the 20 ha plot, Panattoni has started the construction of Panattoni Park GÅ‚ogów investment, which will provide a total of 111 thousand sq m. of space. The first of the two scheduled buildings will provide 78 thousand sq m. of space. The developer is also starting the implementation of another project in this region - Panattoni Park BolesÅ‚awiec, which will bring 50 thousand sq m. of warehouses. In addition, Panattoni has started the next stage of construction of their largest investment in Lower Silesia - WrocÅ‚aw Campus 39 - in Wierzbice near Wroclaw. It will offer a total of 150 thousand sq m. of space. Large facilities near Wroclaw GLP is building WrocÅ‚aw V Logistics Center, the largest warehouse project currently under construction in the Wroclaw agglomeration. 5 buildings of approximately 240 thousand sq m. are to be erected on 50 ha of land. Moreover, the construction of a facility offering 41 thousand sq m. has already started in Magnice near Wroclaw. Hillwood Polska is also building in Lower Silesia. Nearly 90 thousand sq m. of warehouses will be built in Sycow. The first building will bring over 44 thousand sq m. of space. Mountpark Logistics has also started construction. The first phase of the investment will provide 35 thousand sq m. of space, and the entire warehouse and logistics complex Mountpark WrocÅ‚aw will offer 140 thousand sq m. of warehouses. In Gorzow Wielkopolski, MLP Group purchased a 12 ha plot designated for a modern logistics and distribution center MLP Gorzów Wielkopolski with a lease area of 52 thousand sq m. Accolade company has also invested in the expansion of warehouses in this city, acquiring further investment areas. The company is planning on constructing industrial warehouses of almost 100 thousand sq m. At the western border, by the national road No. 24, Hillwood Rokitno logistics center of 112 thousand sq m. is also being built. The company is currently also implementing Hillwood Bydgoszcz investment of a similar size. Also in Swiebodzin, in Lubuskie Province, Amazon has recently opened its tenth logistics center in Poland, providing 193 thousand sq m. Szczecin under development New warehouse facilities are also emerging in Szczecin. Accolade company has acquired two industrial properties there. Modern warehouse spaces with a total of 73 thousand sq m. will be built on the land. The currently implemented stage of the project at Kniewska Street in Szczecin will include 31 thousand sq m. of space. In Goleniow, Panattoni Park Goleniów with a target area of 54 thousand sq m. is under construction. Nearly 20 thousand sq m. has been built so far. Pruszcz Logistics is preparing an investment in Bedzieszyn, which will bring about 50 thousand sq m. Apart from the warehouse hall, the project will include an office building. GLP, in turn, plans to implement the next stage of the Pomeranian Logistics Center in Gdansk. Another 39 thousand sq m. of warehouse and production space is to be built in the vicinity of the DCT Gdansk container terminal. Further investments in Poznan MLP Group is expanding the MLP PoznaÅ„ West project near Poznan. Another 43,000 sq m. of warehouses will be built in the complex in DÄ…brówka. P3 is going to build a building providing 82.5 thousand square meters in P3 PoznaÅ„ park for Westwing, The company offers the possibility of extension with additional 27 thousand sq m. In addition, Panattoni Park PoznaÅ„ East Gate with 45 thousand sq m. will be built on a plot of 10 hectares in SwarzÄ™dz minicipality near Poznan. Good Point, a Real Management brand, is also planning the construction of warehouses and technology parks near Warsaw, on land in the municipalities of Gora Kalwaria and Karczew. In Strykow in the Lodz province, in the vicinity of the junction connecting the A1 and A2 motorways, Mountpark Logistics is preparing a warehouse and logistics center which will provide 245 thousand sq m. New warehouses in Upper Silesia The largest warehouse investment in Upper Silesia is GLP LÄ™dziny Logistics Center, where 111 thousand sq m. is to be delivered. In Gliwice, MDC2 company has purchased a plot of 13.4 ha designated for a warehouse and logistics facility. MDC2 Park Gliwice complex is to consist of three buildings with 52 thousand sq m. of warehouse space. In addition, European Logistics Investment has started the construction of a second warehouse building in Silesia. The implementation of Park Tychy II investment is to bring 43 thousand sq m. of space. In Miedzyrzecze, 7R company will also build a specialized warehouse with about 20 thousand sq m. for the production company Aluprof. Retailers are building facilities Chain brands are also investing in logistics. Jeronimo Martins is already building the seventeenth distribution center for Biedronka in our country. A complex of warehouse and logistics halls with 54 thousand sq m., will be built in Stawiguda near Olsztyn on a 9 hectare plot. ALDI chain, which plans to open 40 stores in Poland, is to have a new distribution center located near Bydgoszcz, with over 43 thousand sq m. Recently, Lublin province also issued a building permit for the largest logistics park in Europe. In Malaszewicze, a modern cargo transshipment hub between Asia and Europe is to be built in the current dry port, which after the expansion will quadruple its capacity. The construction of the logistics park, which will occupy a key place on the New Silk Road route, is planned to start in 2022, and its implementation will take 5 to 6 years. The investment will cost over PLN 3 billion. Half of the funds are to come from the state budget. 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.
The Wild Card Is Back

The Wild Card Is Back

Monica Kingsley Monica Kingsley 19.11.2021 15:58
S&P 500 rose, once again driven by tech and not value. That‘s still defensive, mirroring the weak credit markets posture. While waiting for bonds to turn – not that there wouldn‘t be an optimistic HYG open yesterday – the Austria lockdown news sent markets into a tailspin, the fear being good part of Europe would follow suit rather sooner than later. Oil has taken the crown of panicked selling, stocks held up better, and precious metals weren‘t changed much. Sure, any crippling of European economic activity would take a toll at the most sensitive commodities, but in light of energy policies across much of the Western world, it‘s my view that oil prices would be affected only in the short-term. This isn‘t a repeat of the Apr 2020 liquidation sending black gold negative. Rest of the world would be happy to step in, U.S. included, as we‘re entering winter with comparatively very low stockpiles from oil to copper – and don‘t get me started on silver. If you want green economy, these metals are essential, and oil is still in huge demand in the interim. Fed money printing hasn‘t vanished, debt ceiling awaits, and dollar is so far still solidly underpinned. Banking sector and emerging markets performance isn‘t panicky, but some time for stocks to come back at ATHs, is needed. Precious metals resilience is encouraging for commodities, which need the most time to recover (eyes on energy). Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 bulls have the upper hand, but short-term volatility and uncertainty is creeping in. Still, there is no sinking the bull right here, right now. Credit Markets Tentative signs of credit markets stabilization are here, and HYG turnaround to last, is the missing sign. I‘m though not looking for risk-off slant to disappear, which would slow down the coming rise in yields. Gold, Silver and Miners Gold and silver are still consolidating, and the more time passes at current levels, the less opportunity the bears have. The chart remains very bullish as precious metals are anticipating inflation to come. Crude Oil Crude oil bulls are facing spanner in the works today, and it‘s my view the sellers wouldn‘t get too far. I‘m looking at oil sector to presage that. Copper The copper setback was soundly bought, and commodities hardly sold off, the same for other base metals. I still like the chart posture – favors the bulls. Bitcoin and Ethereum Bitcoin and Ethereum bears took the gauntlet, and another opportunity to pause might be here. I‘m not yet optimistic prices would hold out before the upleg resumes. Summary S&P 500 bulls keep hanging in there, as if waiting for bonds to come to their senses. The credit markets non-confirmation being probably in its latter stages, was my yesterday‘s point – but with corona panic returning, all short-term bets are off. Looking at the big picture, energy hasn‘t been fixed, precious metals are set to rise sharply, and inflation hasn‘t yet knocked off stocks or the real economy. Look for VIX to keep rising from the current 17.50 level. 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.
Binance calls for global crypto regulations

Binance calls for global crypto regulations

Capital Capital 17.11.2021 20:41
Cryptocurrency exchange Binance released a call for global crypto regulations on Tuesday and a framework of fundamental rights for users that it says should be protected. “At Binance, we believe that crypto belongs to everybody, and that in order to reach the next billion users, blockchain and crypto platforms must work with regulators and policymakers to develop global regulatory frameworks to achieve the mutual goal of protecting users,” the company said in its announcement. “While it’s true that crypto has come a long way, as of today, only a small fraction of the world’s population uses crypto on a regular basis,” the company added. The announcement is the first advertisement that Binance has taken out, according to a tweet from Binance founder Changpeng Zhao. It appeared in newspapers around the globe, including the Financial Times, Washington Post, and New York Times. 10 Fundamental Rights According to Binance’s framework - called the 10 Fundamental Rights For Crypto Users - crypto regulations should be premised on making “financial (opportunities) accessible to everyone, not just the privileged few.” To accomplish this, Binance says regulators and policymakers must work to expand access to crypto technology, implement Know Your Customer requirements for crypto platforms, and implement liquidity requirements like those in the banking system. The framework would also give crypto users the right to access exchanges and ensure their investments are safe. Users would also have safe access to emerging technologies such as non-fungible tokens, stablecoins, staking, and yield-farming. Market maturation The company said it released the framework because the recent market maturation has driven an influx of new crypto investors at a time when the regulatory framework is still relatively weak. Digital assets like Bitcoin and Ethereum both reached new all-time highs in early November, though the assets have slowly retracted in value since. For example, Bitcoin has experienced two 10% retracements in the past week alone. Even so, data from crypto analytics firm Delphi Digital shows that the funding rates for Bitcoin and Ethereum have remained near neutral levels. This means that futures and options contracts are trading at near equal value to each asset’s market value. A move into the negative territory could “suggest short-term bearishness among the 'smart money' crowd,” according to a note published on Tuesday by Delphi analyst Joo Kian. The crypto market was down on Tuesday with Bitcoin losing 4.58% to $60,643.00 by 21:15 UTC. Other popular assets like Ethereum and Solana were down 5.9% and 5.01%, respectively. Regulatory framework Jessica Jung, a spokesperson for Binance, told Capital.com that these factors make it a critical time to develop a regulatory framework of protections for crypto users. “I believe that regulation is welcomed in this industry and want to stress that 'smart regulation' is beneficial to the safe custody of cryptocurrency,” Jung told Capital.com in an interview. “Like seatbelts in a car, a more appropriately regulated crypto market provides greater protections for everyday users.”
Market Quick Take - November 19, 2021

Market Quick Take - November 19, 2021

Saxo Bank Saxo Bank 19.11.2021 10:43
Summary:  Equity markets charged higher in the US session to close at new record highs, and the upside extended further in the futures market overnight. In FX, the recent USD strength eased slightly, while oil prices are creeping back higher despite the recent fears of strategic reserve releases. Markets are nervously awaiting the announcement of who US President Biden will nominate to head the Fed after the current Powell term ends in February. What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) - US equities pushed to new all-time highs yesterday led by technology stocks and strong macro figures across manufacturing surveys and job market data such as jobless claims. Nasdaq 100 futures are trading around the 16,560 level in early European trading with the 16,500 being the intraday day support level. A recent survey among institutional investors shows that a majority is believing in the transitory inflation narrative which can help explain why investors in equities are looking through the latest inflation pressures. EURUSD and EURGBP – the beleaguered euro finally bounced back a bit after its recent remarkable slide, although it is tough to see what could engineer a reversal of the move below the 1.1500 level, which is the key chart resistance now, although Biden announcing Brainard as his pick to head the Fed next February could drive considerable short-term volatility. To stop the euro from a persistent slide, we would need a very different tone from the ECB than it has delivered recently, with no real opportunity to do so until the December 16 ECB meeting. With power prices and a new Covid wave weighing on the outlook, the ECB will very likely be happy to stay firmly dovish. USDJPY – the highs for the cycle near the psychologically important 115.00 look safe as long as US treasury yields at the longer end of the curve remain rangebound, but trading above that level could get volatile if it is broken, as some options structures may be linked to its breaking or not breaking. The next test for the price action is clearly the Fed Chair nomination that appears imminent – possibly today or over the weekend (more below in What are we watching next?). Gold (XAUUSD) has spent the week trading within a relatively narrow range between $1850 and $1870 as it awaits a fresh catalyst following last week’s breakout. The impressive rally that occurred despite headwind from a stronger dollar has stalled with bond yields picking up and the market wondering how the US Federal Reserve will manage the current inflation spike. Silver and especially platinum have both struggled to keep up with gold while ETF investors have yet to show any interest in accumulating exposure. All developments raising the risk of a retracement towards the $1830-35 key area of support. Crude oil (OILUKJAN22 & OILUSDEC21) managed to recover yesterday after the market brushed aside the potential negative price impact of a US SPR release. US attempts to attract wider support from other major importing countries seems to have fallen flat, except for China who is “working” on a release. Having dropped more than five dollars since speculation began, the market has concluded for now that the price impact of a release could be limited. The market, however, may still have to deal with the recent updates from EIA and IEA, in which they both forecast current tight market conditions could start to ease early next year as well as renewed Covid-related reductions in mobility. US Treasuries (IEF, TLT). Yesterday’s 10-year US TIPS auction stopped through, pricing at a record low yield at -1.145%. It is a signal that investors are ever more concerned about inflation risk.  The Treasury also sold 4-week and 8-week T-Bills. While the latter was priced in line with the Reverse Repurchase facility, 4-week T-Bills priced with a yield of 0.11%, more than double the RRP rate. As we approach the day in which the Treasury will run out of cash, we expect volatility in the money market to increase, while long-term yields will remain compressed as they will serve as a safe haven. In the meantime, the move index continues to rise indicating that the bond market remains on the hedge. What is going on? Central Bank of Turkey cut another 100 basis points from the policy rate, lira plunge extends. The Turkish lira has lost more than 10% versus the US dollar this week and trades well over 11.00 after Turkish President Erdogan earlier this week declared himself once again against high interest rates, which he believes cause inflation. Central bank chief Kavcioglu, who is seen as doing Erdogan’s bidding, cut rates for a third time by 1.0% to take the policy rate to 15%, but with the Turkish lira losing over 10% this week alone and more than 30% since Erdogan fired the prior more hawkish central bank head in favour of Kavcioglu, inflation will run far beyond the rate. Not even some guidance that the easing cycle may conclude in December was enough to halt the lira’s slide. US Nov. Philly Fed survey hits 39.0, a very hot reading and fourth highest ever - with Prices Paid at 80 and just missing the 42-year high of 80.7 in June, although the Prices Received was at 62.9, the highest since 1974. Special survey questions in the Novemer  survey included one on inflation expectations, with firms expecting a median 5.3% increase in their own prices, and an increase in wages of 4.8%. The median forecast for 10-year inflation was 3.5%, up from the 3.0% the last time the question was asked in August. The Bloomberg Agriculture Index hit a fresh five-year high this week with food prices likely to stay high in 2022 with labor shortages, La Ninã weather impacts, surging cost of fertilizers being the common denominator across the sector. Recent gains being led by coffee, which we highlighted earlier in the week as a commodity currently seeing multiple price supportive developments. Wheat is heading for a nine-year high in Chicago while hitting record highs in Europe with inventories tumbling amid strong demand from importers and now also a rain threat to the soon-to-be harvested Australian crop. Soybeans have seen a strong bounce after the latest WASDE report showed a tighter than expected outlook for the coming year, and following a recent rush of Chinese buying from the US and South America. Apple doubles down on self-driving cars. The company is aiming to develop fully autonomous driving capabilities for cars by 2025 under the project name Titan. Apple has developed its own chip and is aiming to soon have a car on the roads for testing. However, delivering self-driving cars is a difficult endeavor with Uber Technologies having sold its unit and Waymo (Google’s unit) has been struck by fatigue and key people leaving the project. Tesla is also still struggling to deliver self-driving cars. What are we watching next? Who will US President Biden nominate to head the Fed next February? Powell is still seen as more likely to get the nod that Brainard by roughly two to one, and this Fed Chair nomination issue is hanging over the markets, as the current Fed chair term ends in early February and from comments made earlier this week, an announcement could be made any day now. One uncertainty that would come with a Brainard nomination is the potential difficulty of having her nomination approved by the Senate. The nomination news could generate significant short-term volatility on the choice of the nominally more dovish Lael Brainard over current Fed Chair Powell, though we see little difference in the medium-longer term implications for monetary policy, and the Fed is likely to get a prominent new regulatory role either way (under Brainard or someone else if she is nominated to replace Powell). Vote on $1.7 trillion US fiscal bill today in the House of Representatives after the Congressional Budget office said the bill, which focuses on social spending and climate initiatives, would add some $367 billion to the US Federal deficit (around 1.5% of current US nominal GDP) over the next 10 years. Earnings Watch – there are no important earnings today and this earnings week has been good in the US and Europe, while a bit more mixed among Chinese companies. The list below shows earnings releases next week. Monday: Sino Pharmaceutical, Prosus, Zoom Video, Agilent TechnologiesTuesday: Xiaomi, Kuaishou Technology, Compass Group, Medtronic, Analog Devices, Autodesk, VMWare, Dell Technologies, XPeng, HP, Best Buy, Dollar TreeWednesday: DeereThursday: AdevintaFriday: Meituan, Pinduoduo Economic calendar highlights for today (times GMT) 0830 – ECB President Lagarde to speak1200 – UK Bank of England Chief Economist Huw Pill to speak1330 – Canada Sep. Retail Sales1715 – US Fed Vice Chair Clarida to speak on global monetary policy coordination Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app: Apple Spotify Soundcloud Sticher
Weekly S&P500 ChartStorm - 21 November 2021

Weekly S&P500 ChartStorm - 21 November 2021

Callum Thomas Callum Thomas 22.11.2021 09:40
The S&P500 ChartStorm is a selection of 10 charts which I hand pick from around the web and post on Twitter. The purpose of this post is to add extra color and commentary around the charts. The charts focus on the S&P500 (US equities); and the various forces and factors that influence the outlook - with the aim of bringing insight and perspective. Hope you enjoy! p.s. if you haven’t already, subscribe (free) to receive the ChartStorm direct to your inbox, so you don’t miss out on any charts (you never know which one could change the whole perspective!) Subscribe Now 1. S&P 500 Seasonality Chart: It’s everyone’s favorite chart updated again (maybe for the last time this year?). The S&P500 has been sticking to the seasonality script through most of this year… makes me think about Murphy’s Law tho - maybe the market will start to improvise and go off-script? Either way, the next few weeks seasonally look like sideways action. Source: @topdowncharts 2. Volatility Seasonality: A twist on the previous chart — same concept, but this time with implied volatility. I find it interesting to note that the VIX has actually been a bit lower than usual for this time of the year (and trending up short-term…). One last VIX spike before year-end? Source: @topdowncharts 3. Stockmarket Statistics: What happens after the market goes up a “crazy overheated” 20%+ over the course of a year? More Gains. Historically most of the time if the market closed up 20%+ for the year, the next year was also positive (84% of the time). As of writing, the market is up some 27% YTD (albeit, this year ain't over yet!). Source: @RyanDetrick 4. Bad Breadth? Fully 1/3rd of stocks are in a downtrend. (defined as trading below their respective 200dma) Will this bearish divergence be a problem? Source: Index Indicators 5. GAARP vs GAAAP: On this metric, growth stocks are the most expensive ever vs value stocks. So it begs the question… Growth at a reasonable price? or Growth at *any* price? (but then again, who defines what "reasonable" is in a market like this!) Source: @TheOneDave 6. Low Energy: Energy stocks are attempting to turn the corner vs the rest of the market, but face high hurdles from the raging tech bull market, rise of ESG investing and regulatory/political hurdles, not to mention commodity market volatility. What comes down must go up? (or something else?) Source: @dissectmarkets 7. Buybacks Back: New all-time high for buybacks in Q3 (with 95% reported). Always makes me wonder these trends — you see the majority of buybacks occurring near market peaks… i.e. when valuations are extreme expensive. The opposite of value investing: buy more when its expensive, buy less when it’s cheap — seems like upside-down logic to me, but then again I am a simple man. Source: @hsilverb 8. Payout Ratio: As an interesting follow-on to the ATH in buybacks/dividends, it’s interesting to note that the dividend payout ratio is actually below average... Scope to return more cash to investors? Source: @ChrisDagnes 9. Buffett Indicator: Looks like this indicator has reached a permanently higher plateau! (kidding of course - echoing the famous last words of Irving Fisher back in 1929) Interesting stat to note: to make this indicator as cheap as where it got to during the financial crisis lows the market would need to fall over 70%. Definitely not a prediction, but interesting nonetheless. I would say I have multiple quibbles with this indicator, I think CAPE and ERP are better valuation metrics, but that’s a topic for another day. Source: @KailashConcepts 10. Buffett the Compounder: Speaking of Buffett, a lesson in compounding. Source: @DividendGrowth Thanks for following, I appreciate your interest! !! BONUS CHART: total stockmarket leverage >> Click through to the ChartStorm Substack to see the bonus chart section https://chartstorm.substack.com/p/weekly-s-and-p500-chartstorm-21-november                   Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
Global Markets In Times Of Affection Of Situation In Eastern Europe

On the radar this week...

Chris Weston Chris Weston 22.11.2021 08:18
Powell vs Brainard Fed chair nomination  Covid trends and restrictions in Europe US core PCE inflation (Thursday at 2 am AEDT) RBNZ and Riksbank central bank meeting US cash markets shut Thursday for Thanksgiving (Pepperstone US equity indices still open)  Eurozone PMI (Tuesday 20:00aedt) – ECB speakers in play BoE speakers to drive the GBP – will they cast doubt on a December hike? With Covid risks on the rise in Europe and ultimately restrictions being implemented we’ve seen renewed selling interest in the EUR, and the oil-exporting currencies (NOK, CAD, MXN). Certainly, the NOK was the weakest G10 currency last week, and GBPNOK has been a great long position – a pair to trade this week, but consider it is up for 9 straight days and has appreciated 5.2% since late October.  I questioned last week if the divergence in EURCHF plays out, and the break of 1.05 negates that, suggesting staying short this cross for now as the CHF is still a preferred safe-haven.  EURUSD has been in free-fall EURUSD has been in free-fall and will likely get the lion’s share of attention from clients looking for a play on growing restrictions and tensions across Europe. The pair has lost 3.5% since rejecting the 50-day MA on 28 Oct and has consistently been printing lower lows since May – predominantly driven by central bank divergence and a growing premium of 2-year US Treasuries over German 2yr - with the spread blowing out from 78bp to 128bp, in favour of USD. For momentum, trend followers and tactical traders, short EUR remains attractive here.  It will be interesting to see if we see any pickup in shorting activity in EU equities – notably the GER40, with the German govt warning of lockdowns ahead. A market at all-time highs (like the GER40) is a tough one to short, but if this starts to roll over then I’d go along for a day trade. There is a raft of ECB speakers also to focus on, notably with President Lagarde due to speak on Friday.  Playing restrictions through crude While we can play crude moves in the FX, equity and ETF space, outright shorts in crude have been looking compelling. Although we see SpotCrude now sitting on huge horizontal support and a break here brings in the 50-day MA. Of course, as oil and gasoline fall, the prospect of a release of the SPR (Strategic Petroleum Reserves) diminishes, however, the Biden administration could use this move lower move to their advantage and capitalize to keep the pressure on.  (SpotCrude daily) A rise in restrictions also means market neutral strategies (long/short) should continue to work, and long tech/short energy has been popular. We can express this in our ETF complex, with the XOP ETF (oil and gas explorers) -8.1% last week and that works as a high beta short leg. Long IUSG (growth) or the QQQ ETF against this would be a good proxy on the opposing leg. In fact, looking at the moves in Apple, Nvidia, Alphabet and Amazon, and we can see these ‘safe haven’ stocks are working well again, as is Tesla although for different reasons.  Stocks for the trend-followers For the ‘buy strong’ crowd, I have scanned our equity universe for names above both their 5- and 20-day MA AND at 52-week highs. Pull up a daily chart of any of these names - they should nearly always start at the bottom left, and end top right. Playing the RBNZ meeting tactically By way of event risks, the RBNZ meeting (Wed 12:00 AEDT) is one of the more interesting events to focus on. Will the RBNZ raise by 25bp or 50bp? That is the question, and of 19 calls from economists (surveyed by Bloomberg) we see 17 calling for a 25bp hike – yet the markets are fully pricing not just a 25bp hike but a 43% chance of 50bp – from a very simplistic perceptive if the RBNZ hike by ‘just’ 25bp, choosing a path of least regret, then we could see a quick 25- to 30-pip move lower in the NZD. The focus then turns to the outlook and whether the 8 further hikes priced over the coming 12 months seems to be one shared by the RBNZ.  Traders have been keen to play NZD strength via AUD, as it is more a relative play and doesn’t carry the risk on/off vibe, which you get with the USD and JPY. I’d be using strength in AUDNZD as an opportunity to initiate shorts, especially with views that RBNZ Gov Orr could talk up the possibility of inter-meeting rate hikes.  GBP to be guided by the BoE Chief The GBP is always a play clients gravitate to, with GBPUSD and EURGBP always two of the most actively traded instruments in our universe. A 15bp hike is priced for the 16 Dec BoE meeting after last week’s UK employment and inflation data, but consider we also get UK PMI data (Tuesday 20:30 AEDT), and arguably, more importantly, speeches from BoE Governor Bailey and chief economist Huw Pill – perhaps this time around expectations of hikes can be better guided – although, a bit of uncertainty into central bank meetings is very pre-2008 and makes things a little spicy/interesting.  (BoE speakers this week) GBPUSD 1-week implied volatility is hardly screaming movement, and at 6.5% sits at the 10th percentile of its 12-month range. The implied move is close to 130pips, so the range at this juncture (with a 68.2% level of confidence), although I multiple this by 0.8 to get closer to the options breakeven rate. So at this stage, 100 pips (higher or lower) is the sort of move the street is looking for over the coming five days, putting a range of 1.3557 to 1.3349 in play – one for the mean reversion players. Personally, I would let it run a bit as that volatility seems a little low, and a break of 1.3400 could see volatility pick up. I’d certainly be looking for downside if that gave way.  Happy trading.
We Might Say Next FED Moves Are Not Obvious As Some Factors Differentiate Circumstances

Silver, shrugging off attacks

Korbinian Koller Korbinian Koller 20.11.2021 13:32
Weekly chart, Silver in US-Dollar, strong along gold: Silver in US-Dollar, weekly chart as of November 20th, 2021. The weekly chart illustrates price behavior over the last 15 months. Silver prices are trading near the center of the sideways range. Gold in US-Dollar, weekly chart, rumors shrugged off: Gold in US-Dollar, weekly chart as of November 20th, 2021. The weekly chart of gold isn’t much different from where prices stand. In short, there is no evidence that gold has lost its luster. Otherwise, we would see silver trading in a relationship much lower. Rumors are just that – rumors! Silver is shrugging them off. Silver in US-Dollar, quarterly chart, room to go: Silver in US-Dollar, quarterly chart as of November 20th, 2021. A historical review with a quarterly chart over the last eighteen years reveals that silver prices can sustain extreme extensions from the mean (yellow line) for extended periods. Using the extreme of the second quarter in 2011 as a projective measurement (orange vertical line) for an upcoming target would provide for a price target more than 10% above all-time highs at US$56. In addition, the chart shows that we find ourselves in a strong quarter so far, which is in alignment with cyclical probabilities. Silver in US-Dollar, weekly chart, prepping the play: Silver in US-Dollar, weekly chart as of November 20th, 2021. Trade setup Let us return to the weekly time frame for a possible low-risk entry scenario with this target in mind.We find a supply zone based on fractal transactional volume analysis near the price of US$24.11 and US$22.65. Both attractive entry zones for excellent risk/reward-ratio plays.   Phase 1 drilling program at Guigui discovered not only the largest intrusive ever found in the district, but it’s the first mineralized skarn ever seen in Guigui! Silver, shrugging off attacks: It will not be rumors, doubts, and speculations that will be the catalyst for silvers’ success or failure. It isn’t a question of “if,” but just a question of “when” we will see the next massive price advance in this precious metal. The odds are stacked too much in favor of a continued price movement up that the long-term investor should let doubts allow for diverging from a splendid opportunity to partake in wealth preservation and a very profitable way to participate in a chance rarely presented this prominent. 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. This article does 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 Korbinian Koller|November 20th, 2021|Tags: Crack-Up-Boom, Gold, Gold bullish, Gold/Silver-Ratio, inflation, low risk, Silver, silver bull, Silver Chartbook, silversqueeze, technical analysis, time frame, trading principles|0 Comments About the Author: Korbinian Koller Outstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent. Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.
US Thanksgiving week features key Wednesday event risks

US Thanksgiving week features key Wednesday event risks

Saxo Bank Saxo Bank 22.11.2021 10:56
Summary:  Today we look at the lay of the equity market coming into this week, where we continue to note considerable market divergences, recapping the points from Friday, including the narrow market rally. We also look at whether credit spreads for high yield corporates are finally starting to deserve some attention. Focus in commodities on oil and especially gold this week as it is do-or-die time for bullish newcomers after the recent rally spike. The week ahead is a short one for US-based traders, with the Fed Chair nomination issue hanging over the market and the two key event risks for the week up on Wednesday, just before the long holiday weekend there. Today's pod features Peter Garnry on equities, Ole Hansen on fixed income and John J. Hardy hosting and on FX. Listen to today’s podcast and have a look at today’s slide deck. Follow Saxo Market Call on your favorite podcast app: Apple Spotify Soundcloud Sticher If you are not able to find the podcast on your favourite podcast app when searching for Saxo Market Call, please drop us an email at marketcall@saxobank.com and we'll look into it.   Questions and comments, please! We invite you to send any questions and comments you might have for the podcast team. Whether feedback on the show's content, questions about specific topics, or requests for more focus on a given market area in an upcoming podcast, please get in touch at marketcall@saxobank.com.
Crypto pullback continues as market cap nears $2.5 Trillion once again

Crypto pullback continues as market cap nears $2.5 Trillion once again

Walid Koudmani Walid Koudmani 19.11.2021 13:59
Crypto pullback continues as market cap nears $2.5 Trillion once again While the Crypto market continues to experience increased volatility in recent days, with Bitcoin still unable to interrupt a 10 day series of losses, we are seeing investor confidence being shaken with the total market capitalization dropping once again to the $2.5 Trillion range after nearing $3 Trillion just days ago. Despite no major fundamental news causing a reaction, Bitcoin dropped around 20% from the high reached on November 10th and is hovering near $56,000 while the majority of Alt-coins have experienced drops of 10-20%. This further emphasises the volatile nature of these assets which have experienced significant price fluctuations despite a lack of major drivers but also reaffirms the potential for them to rebound substantially as we have seen several times in the past. All in all, the situation is quite complex and while some may be expecting the downward move to continue, it is important to look at the other side of the matter where one can see that even on red days, there are several cryptos that are trading higher.  Investors await potential Biden Fed chairman decision Many investors are going to be paying close attention to today’s potential announcement from the United States as president Biden is set to decide on his nomination for head of the Federal reserve to possibly replace Jerome Powell. The Fed has played a key role in supporting the markets during the post-pandemic recovery with its extensive quantitative easing program and record low interest rates, but today’s decision may cause some nervousness as replacing the chairman of the US central bank could add to the unpredictability the markets are facing nowadays. While president Biden may wait till after market close to make his announcement, in an attempt to not shake up markets before the weekend, the fact remains that such a significant change at high levels of leadership could have far reaching implications for monetary and fiscal policy moving forward. Download our Mobile Trading App:   Google Play   App Store  
COT: Solid gold buying raising short term concerns

COT: Solid gold buying raising short term concerns

Ole Hansen Ole Hansen 22.11.2021 11:35
Summary:  This summary highlights futures positions and changes made by hedge funds across commodities, forex and financials up until last Tuesday, November 16. The report shows the reaction to the US inflation shock on November 11 which among others drove strong demand for gold and more surprisingly a reduction in the dollar long. Also another strong week for most agriculture commodities with positions in coffee and KCB wheat hitting fresh multi-year highs Saxo Bank publishes weekly Commitment of Traders reports (COT) covering leveraged fund positions in commodities, bonds and stock index futures. For IMM currency futures and the VIX, we use the broader measure called non-commercial. Link to latest report This summary highlights futures positions and changes made by hedge funds across commodities, forex and financials up until last Tuesday, November 16. A week where the market responded to the US inflation shock on November 11 by sending  the dollar up by 2% to fresh high for the cycle while 10-year breakeven yields jumped 20 basis point a decade high. While bond market volatility jumped, stocks held steady with the VIX showing a small decline. The commodity sector was mixed with gains in precious metals and not least grains and soft commodities helping offset weakness across the energy sector.  Commodities Hedge funds raised their total commodity exposure, measured in lots, across 24 major futures contracts by the most since July. Driven by continued strong price action across the agriculture sector and more recently also precious metals in response to surging inflation. These sectors saw all but one market being bought while the energy sector were mixed with continued selling of crude oil only being partly offset by demand for gasoline and natural gas. Energy: Crude oil’s four week slide resulted in the biggest weekly reduction since July, and this time, as opposed to recent weeks, it was WTI that led the reduction with a 10% cut to 307k apart from a deteriorating short-term technical outlook also being driven the prospect of a US stockpile release to dampen domestic gasoline prices. Brent meanwhile saw its net long slump to a one-year low at 221.5k lots, and during the past six weeks the net length has now slumped by one-third, a reduction which gathered momentum after the late October failure to break the 2018 high at $86.75, now a double top. Crude oil comment from our daily Market Quick Take: Crude oil (OILUKJAN22 & OILUSDEC21) opened softer in Asia after Friday’s big drop but has so far managed to find support at $77.85, the previous top from July. The market focus has during the past few weeks shifted from the current tight supply to the risk of a coordinated reserve release, fears about a renewed Covid-driven slowdown in demand and recent oil market reports from the EIA and IEA pointing to a balanced market in early 2022. Having dropped by around 10% from the recent peak, the market may have started to conclude that a SPR release has mostly been price in by now. Metals: Another week of strong gold buying has now raised the alarm bells given the risk of long liquidation should the yellow metal fail to hold onto its US CPI price boost above $1830. Last week the net long in gold reached a 14-month high at 164k lots and the speed of the accumulation, especially the 70% jump during the past two weeks alone carries, will be raising a red flag for tactical trading strategies looking for pay day on short positions should support give way.  Gold extended Friday’s drop below $1850 overnight, before bouncing ahead of key support in the mentioned $1830-35 area. The risk of a quicker withdrawal of Fed stimulus supporting real yields and the dollar has for now reduced gold's ability to build on the technical breakout. However, the price softness on Friday helped attract ETF buying with Bloomberg reporting a 10 tons increase, the biggest one-day jump since January 15. A second week of silver buying lifted the net to a four-week high at 35.9k lots, but still below the May peak at 47.8k lots. Copper’s rangebound trading behavior kept the price and the net long unchanged. The latter due to an even size addition of both new long and short positions. Agriculture: Broad gains across the grains market lifted the combined long across the six most traded contracts to a six-month high at 560k lots. Buyers returned to soybeans after the net long recently hit a 17-month low, the corn long was the biggest since May while the KCB wheat long at 60.6k lots was the highest since August 2018. Supported by an increasingly worrying supply outlook, coffee speculators lifted their net long by 16% to a five-year high at 55k lots. Cotton and sugar longs also rose while short-covering helped halve the cocoa net short. More on the reasons behind the current strength in wheat and coffee, and agriculture in general can be found in may recent update: Agriculture rally resumes led by coffee, wheat and sugar ForexIn a surprise response to the US inflation shock on November 11 speculators ended up making a small reduction in their overall dollar long against ten IMM futures and the Dollar index. Selling of euro in response to the 2.4% drop and a 161% increase in the sterling short to a 17 month high ended up being more than off-set by the buying of all other major currencies, most notably JPY and CHF. The result being a fifth weekly reduction in the dollar long to $21.3 billion, now down by 17% reduction from the near 30-month high reached during October. What is the Commitments of Traders report? The COT reports are issued by the U.S. Commodity Futures Trading Commission (CFTC) and the ICE Exchange Europe for Brent crude oil and gas oil. They are released every Friday after the U.S. close with data from the week ending the previous Tuesday. They break down the open interest in futures markets into different groups of users depending on the asset class. Commodities: Producer/Merchant/Processor/User, Swap dealers, Managed Money and otherFinancials: Dealer/Intermediary; Asset Manager/Institutional; Leveraged Funds and otherForex: A broad breakdown between commercial and non-commercial (speculators) The reasons why we focus primarily on the behavior of the highlighted groups are: They are likely to have tight stops and no underlying exposure that is being hedged This makes them most reactive to changes in fundamental or technical price developments It provides views about major trends but also helps to decipher when a reversal is looming
COT Speculators drop British pound sterling bets to lowest level in 76-weeks

COT Speculators drop British pound sterling bets to lowest level in 76-weeks

Invest Macro Invest Macro 22.11.2021 11:46
November 20, 2021 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 November 16th 2021 and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the euro will decline versus the dollar. Highlighting the COT Currency data this week is the second straight decline in British pound sterling speculative positions. The pound sterling speculator contracts dropped sharply for the second consecutive week this week and have now fallen by a total of -46,646 contracts over just this two-week time period. These declines have pushed the overall speculative position into a bearish sentiment level of -31,599 contracts which marks the lowest standing of the past seventy-six weeks, dating back to June 2nd of 2020. The GBPUSD currency pair has been under pressure since the middle of October and fallen from around 1.3800 exchange rate to just above the 1.3435 level currently, a drop of almost 400 pips. Data Snapshot of Forex Market Traders | Columns Legend Nov-16-2021 OI OI-Index Spec-Net Spec-Index Com-Net COM-Index Smalls-Net Smalls-Index EUR 705,698 86 -3,826 34 -26,985 68 30,811 25 JPY 252,897 91 -93,126 10 115,758 94 -22,632 1 GBP 207,099 43 -31,599 51 41,182 54 -9,583 36 MXN 170,102 33 -47,655 2 46,127 99 1,528 50 AUD 166,688 57 -61,153 27 69,858 71 -8,705 31 CAD 148,955 30 8,709 62 -26,717 35 18,008 74 USD Index 59,387 88 34,908 86 -40,455 7 5,547 77 RUB 52,624 58 22,625 67 -23,936 31 1,311 70 CHF 49,320 27 -8,889 54 18,767 52 -9,878 34 NZD 42,945 30 13,965 95 -15,521 6 1,556 70 BRL 31,767 32 -15,698 48 15,743 54 -45 66 Bitcoin 13,648 78 -1,478 69 357 0 1,121 23   US Dollar Index Futures: The US Dollar Index large speculator standing this week was a net position of 34,908 contracts in the data reported through Tuesday. This was a weekly lowering of -540 contracts from the previous week which had a total of 35,448 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 86.0 percent. The commercials are Bearish-Extreme with a score of 7.4 percent and the small traders (not shown in chart) are Bullish with a score of 77.2 percent. Free Reports: Top 5 Companies Added to Our Stock Watch List this Quarter - Here are the Stock Symbols that stood out so far in the fourth quarter of 2021. Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.   US DOLLAR INDEX Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 80.8 3.4 12.8 – Percent of Open Interest Shorts: 22.0 71.5 3.5 – Net Position: 34,908 -40,455 5,547 – Gross Longs: 47,959 2,000 7,621 – Gross Shorts: 13,051 42,455 2,074 – Long to Short Ratio: 3.7 to 1 0.0 to 1 3.7 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 86.0 7.4 77.2 – COT Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 5.0 -2.7 -13.6   Euro Currency Futures: The Euro Currency large speculator standing this week was a net position of -3,826 contracts in the data reported through Tuesday. This was a weekly reduction of -7,599 contracts from the previous week which had a total of 3,773 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 33.8 percent. The commercials are Bullish with a score of 68.1 percent and the small traders (not shown in chart) are Bearish with a score of 25.4 percent. EURO Currency Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 28.1 57.3 12.8 – Percent of Open Interest Shorts: 28.6 61.1 8.4 – Net Position: -3,826 -26,985 30,811 – Gross Longs: 198,181 404,266 90,261 – Gross Shorts: 202,007 431,251 59,450 – Long to Short Ratio: 1.0 to 1 0.9 to 1 1.5 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 33.8 68.1 25.4 – COT Index Reading (3 Year Range): Bearish Bullish Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 5.7 -5.2 -0.0   British Pound Sterling Futures: The British Pound Sterling large speculator standing this week was a net position of -31,599 contracts in the data reported through Tuesday. This was a weekly lowering of -19,506 contracts from the previous week which had a total of -12,093 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 51.2 percent. The commercials are Bullish with a score of 54.0 percent and the small traders (not shown in chart) are Bearish with a score of 35.8 percent. BRITISH POUND Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 24.4 61.4 11.3 – Percent of Open Interest Shorts: 39.6 41.5 15.9 – Net Position: -31,599 41,182 -9,583 – Gross Longs: 50,443 127,197 23,322 – Gross Shorts: 82,042 86,015 32,905 – Long to Short Ratio: 0.6 to 1 1.5 to 1 0.7 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 51.2 54.0 35.8 – COT Index Reading (3 Year Range): Bullish Bullish Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: -8.3 9.2 -8.1   Japanese Yen Futures: The Japanese Yen large speculator standing this week was a net position of -93,126 contracts in the data reported through Tuesday. This was a weekly increase of 12,225 contracts from the previous week which had a total of -105,351 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 10.4 percent. The commercials are Bullish-Extreme with a score of 93.7 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 0.8 percent. JAPANESE YEN Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 9.7 80.5 8.6 – Percent of Open Interest Shorts: 46.6 34.7 17.6 – Net Position: -93,126 115,758 -22,632 – Gross Longs: 24,635 203,468 21,790 – Gross Shorts: 117,761 87,710 44,422 – Long to Short Ratio: 0.2 to 1 2.3 to 1 0.5 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 10.4 93.7 0.8 – COT Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish-Extreme NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: -18.4 15.5 -4.1   Swiss Franc Futures: The Swiss Franc large speculator standing this week was a net position of -8,889 contracts in the data reported through Tuesday. This was a weekly rise of 8,154 contracts from the previous week which had a total of -17,043 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 54.4 percent. The commercials are Bullish with a score of 52.0 percent and the small traders (not shown in chart) are Bearish with a score of 34.3 percent. SWISS FRANC Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 11.2 64.2 24.4 – Percent of Open Interest Shorts: 29.2 26.1 44.5 – Net Position: -8,889 18,767 -9,878 – Gross Longs: 5,502 31,663 12,048 – Gross Shorts: 14,391 12,896 21,926 – Long to Short Ratio: 0.4 to 1 2.5 to 1 0.5 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 54.4 52.0 34.3 – COT Index Reading (3 Year Range): Bullish Bullish Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 11.9 -12.2 11.8   Canadian Dollar Futures: The Canadian Dollar large speculator standing this week was a net position of 8,709 contracts in the data reported through Tuesday. This was a weekly rise of 3,605 contracts from the previous week which had a total of 5,104 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 62.3 percent. The commercials are Bearish with a score of 34.9 percent and the small traders (not shown in chart) are Bullish with a score of 74.0 percent. CANADIAN DOLLAR Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 29.6 42.1 27.1 – Percent of Open Interest Shorts: 23.8 60.0 15.0 – Net Position: 8,709 -26,717 18,008 – Gross Longs: 44,147 62,689 40,389 – Gross Shorts: 35,438 89,406 22,381 – Long to Short Ratio: 1.2 to 1 0.7 to 1 1.8 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 62.3 34.9 74.0 – COT Index Reading (3 Year Range): Bullish Bearish Bullish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 29.6 -26.4 10.0   Australian Dollar Futures: The Australian Dollar large speculator standing this week was a net position of -61,153 contracts in the data reported through Tuesday. This was a weekly gain of 2,271 contracts from the previous week which had a total of -63,424 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 27.1 percent. The commercials are Bullish with a score of 71.0 percent and the small traders (not shown in chart) are Bearish with a score of 31.2 percent. AUSTRALIAN DOLLAR Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 18.5 67.2 11.8 – Percent of Open Interest Shorts: 55.1 25.3 17.1 – Net Position: -61,153 69,858 -8,705 – Gross Longs: 30,760 112,044 19,744 – Gross Shorts: 91,913 42,186 28,449 – Long to Short Ratio: 0.3 to 1 2.7 to 1 0.7 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 27.1 71.0 31.2 – COT Index Reading (3 Year Range): Bearish Bullish Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 27.1 -29.0 24.4   New Zealand Dollar Futures: The New Zealand Dollar large speculator standing this week was a net position of 13,965 contracts in the data reported through Tuesday. This was a weekly boost of 1,083 contracts from the previous week which had a total of 12,882 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 94.7 percent. The commercials are Bearish-Extreme with a score of 6.5 percent and the small traders (not shown in chart) are Bullish with a score of 69.7 percent. NEW ZEALAND DOLLAR Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 61.4 24.1 11.5 – Percent of Open Interest Shorts: 28.9 60.2 7.8 – Net Position: 13,965 -15,521 1,556 – Gross Longs: 26,388 10,349 4,923 – Gross Shorts: 12,423 25,870 3,367 – Long to Short Ratio: 2.1 to 1 0.4 to 1 1.5 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 94.7 6.5 69.7 – COT Index Reading (3 Year Range): Bullish-Extreme Bearish-Extreme Bullish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 9.9 -11.8 19.8   Mexican Peso Futures: The Mexican Peso large speculator standing this week was a net position of -47,655 contracts in the data reported through Tuesday. This was a weekly gain of 752 contracts from the previous week which had a total of -48,407 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 1.5 percent. The commercials are Bullish-Extreme with a score of 98.8 percent and the small traders (not shown in chart) are Bearish with a score of 49.5 percent. MEXICAN PESO Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 41.1 55.3 3.1 – Percent of Open Interest Shorts: 69.2 28.2 2.2 – Net Position: -47,655 46,127 1,528 – Gross Longs: 69,984 94,074 5,245 – Gross Shorts: 117,639 47,947 3,717 – Long to Short Ratio: 0.6 to 1 2.0 to 1 1.4 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 1.5 98.8 49.5 – COT Index Reading (3 Year Range): Bearish-Extreme Bullish-Extreme Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: -5.5 5.6 -1.5   Brazilian Real Futures: The Brazilian Real large speculator standing this week was a net position of -15,698 contracts in the data reported through Tuesday. This was a weekly decrease of -240 contracts from the previous week which had a total of -15,458 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 47.6 percent. The commercials are Bullish with a score of 54.4 percent and the small traders (not shown in chart) are Bullish with a score of 66.3 percent. BRAZIL REAL Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 26.7 64.6 8.0 – Percent of Open Interest Shorts: 76.1 15.0 8.2 – Net Position: -15,698 15,743 -45 – Gross Longs: 8,468 20,507 2,545 – Gross Shorts: 24,166 4,764 2,590 – Long to Short Ratio: 0.4 to 1 4.3 to 1 1.0 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 47.6 54.4 66.3 – COT Index Reading (3 Year Range): Bearish Bullish Bullish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: -17.9 19.3 -12.9   Russian Ruble Futures: The Russian Ruble large speculator standing this week was a net position of 22,625 contracts in the data reported through Tuesday. This was a weekly advance of 1,922 contracts from the previous week which had a total of 20,703 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 66.9 percent. The commercials are Bearish with a score of 30.7 percent and the small traders (not shown in chart) are Bullish with a score of 70.2 percent. RUSSIAN RUBLE Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 57.7 37.7 4.6 – Percent of Open Interest Shorts: 14.7 83.2 2.1 – Net Position: 22,625 -23,936 1,311 – Gross Longs: 30,357 19,849 2,418 – Gross Shorts: 7,732 43,785 1,107 – Long to Short Ratio: 3.9 to 1 0.5 to 1 2.2 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 66.9 30.7 70.2 – COT Index Reading (3 Year Range): Bullish Bearish Bullish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 5.2 -3.3 -20.9   Bitcoin Futures: The Bitcoin large speculator standing this week was a net position of -1,478 contracts in the data reported through Tuesday. This was a weekly reduction of -11 contracts from the previous week which had a total of -1,467 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 68.7 percent. The commercials are Bullish with a score of 71.4 percent and the small traders (not shown in chart) are Bearish with a score of 22.9 percent. BITCOIN Statistics SPECULATORS COMMERCIALS SMALL TRADERS – Percent of Open Interest Longs: 63.4 5.0 14.7 – Percent of Open Interest Shorts: 74.2 2.4 6.5 – Net Position: -1,478 357 1,121 – Gross Longs: 8,649 678 2,008 – Gross Shorts: 10,127 321 887 – Long to Short Ratio: 0.9 to 1 2.1 to 1 2.3 to 1 NET POSITION TREND:       – COT Index Score (3 Year Range Pct): 68.7 71.4 22.9 – COT Index Reading (3 Year Range): Bullish Bullish Bearish NET POSITION MOVEMENT INDEX:       – 6-Week Change in Strength Index: 0.9 -20.8 4.5 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.
The Telegraph Publishes Misleading Story about Omicron

Covid Surge Compounds Monetary Divergence to give the Euro its Biggest Weekly Loss in Five Months

Marc Chandler Marc Chandler 22.11.2021 09:39
Strong US consumption and production figures kept the greenback well supported last week on the heels of the jump in CPI to 6.2%.  Meanwhile, the surge of Covid cases in Europe underscores the divergences with the US, sending the euro to new lows for the year.   At the same time, oil prices headed south for the fourth consecutive week, matching the longest decline in more than two years.  It did not favor the Norwegian krone, the weakest of the majors, with a 2.15% drop.  It brought this year's loss to almost 3.5%, despite it being the first G10 central bank to hike rate, with another likely next month.   The prospects of a Bank of England rate hike next month were lifted by the strong inflation and retail sales figures.  Sterling was the best performing major currency, rising a little more than 0.25% against the dollar.  It also traded at its best level against the euro since March 2020.  At the end of the week, the euro also broke down against the Swiss franc, trading below CHF1.05 for the first time since July 2015.   Japan's October CPI showed that excluding fresh food and energy, the world's third-largest economy has still not broken free of deflation's grip (-0.7% year-over-year).  A weaker yen is not a problem for Japanese policymakers or corporates.  Japan has averaged a monthly trade surplus this year through October of about JPY7.8 bln a month, hardly the stuff that should excite protectionists.  The BIS estimates that eurozone inflation would be closer to 1.5% than the 4.1% reported in October without the supply chain disruptions. The weakness of the euro does not appear problematic for the ECB either.  With the Fed already slowing the pace of its monetary accommodation, a stronger dollar reinforces the policy thrust. Even though net exports shaved Q3 growth by about 1.1 percentage points, it has yet to spur criticism, and September was a record shortfall.   Dollar Index:  The Dollar Index rose for the fourth consecutive week.  It met the (50%) retracement objective of its slide from March 2020 (~103.00) to the January 6 low (~89.20), which is found near 96.10.  DXY stalled ahead of the weekend, just shy of the high set in the middle of the week near 96.25. A move above there targets the next retracement (61.8%), which is close to 97.75.    The MACD is over-extended but still headed higher, while the Slow Stochastic appears to be turning lower.  Support is seen around 95.50.  The market seems to have discounted much of the good news for the dollar and Fed policy.  We note that the US 2-year yield fell almost six basis points last week.  That leaves it off about 4.5 bp this month, despite the strong CPI reading, robust retail sales, and industrial output figures. Euro: The divergence of monetary policy has been the critical weight on the euro, but at the end of last week, it seemed that surge in Covid cases in Europe helped drive the single currency to new lows. It fell to $1.1250 ahead of the weekend to take out the mid-week low near $1.1265.  The weekly loss of about 1.3% is the biggest in five months.  Recall that the $1.1290 area represented the (61.8%) retracement of the rally that began in March 2020.  The momentum indicators are stretched, but a possible bullish divergence is appearing in the Slow Stochastic. A cap seems to be forming around $1.1375.  After repeated tests, and much to the chagrin of the Swiss National Bank, the euro was sold through CHF1.05 ahead of the weekend for the first time since July 2015.  Given its modus operandi, the SNB is likely resisting.  There is little on the charts ahead of CHF1.0250.  In the second half of last week, the euro found support near GBP0.8385, its lowest level since March 2020.  Support is seen close to GBP0.8275-GBP0.8300.  Lastly,  the euro found support near JPY128.00, which has more or less withstood several tests since moving above there in February.   Japanese Yen:  The greenback recorded a new four-year high against the yen, less than a handful of pipis from JPY115 in the middle of last week.  It reversed lower and settled ever so slightly below the previous session's low to leave a key reversal in its wake.  It recorded the week's low ahead of the weekend near JPY113.60.  Since the dollar pushed above JPY112 early last month, we have suggested a JPY113-JPY115 trading range.  It did trade to about JPY112.75 on November 10 and 11 but snapped back into the range.  The US 10-year note futures (December contract) posted a key reversal in the middle of last week, too, and also ended the week at eight-session highs, which, of course, means lower yields.  The dollar-yen exchange rate still seems to be a range-bound creature, more the most part, and heavily influenced by external factors, like US 10-year yield and broader risk appetites.  British Pound:  Sterling outperformed the other major currencies last week, but the 0.3% gain is nothing to write home about.  It remained within the previous week's range. It was unable to sustain the upside momentum after approaching the (50%) retracement objective of the decline since the month's high and outside down day on November 4 (BOE meeting).  That retracement stands at $1.3525.  The strong CPI report on November 17 helped lift sterling to the week's high near $1.3515.  However, the underlying strength of the dollar proved too much, and ahead of the weekend, sterling traded a little below $1.3410.  The momentum indicators have turned higher, and as long as $1.3400 holds, sterling looks attractive.  However, the market appears to have a 15 bp hike at next month's meeting fully discounted.  While it remains a distinct possibility, if not a likelihood, but 100% confidence may leave sterling vulnerable to a reassessment.  Canadian Dollar:  The US dollar rose for the fourth consecutive week against the Canadian dollar, matching the longest advance since early last year.  With the pre-weekend gain, the greenback met the  (61.8%) retracement objective of decline since CAD1.29 was approached on September 20, found near CAD1.2665. The US dollar's broad strength, coupled with the stock market wobble (a proxy for risk), and the drop in crude prices by around 4.25%, the fourth consecutive weekly decline shaved about 0.75% off the Canadian dollar.  The implied yield of the June 2022 Banker Acceptances fell last week and is now about 10 bp lower than at the end of last month.  The MACD is headed up though over-extended, while the Slow Stochastic has flatlined at extreme levels and has not yet confirmed the new highs.  The US dollar continues to hug the upper Bollinger Band, which will begin the new week near CAD1.2650. Australian Dollar:   The Aussie fell for the third straight week, and ahead of the weekend, approached $0.7225, last seen in early October.  As seen with some of the other currency pairs, the MACD is still warning of currency weakness, while the Slow Stochastic is flatlining but over-extended.  The trendline connecting the August and September lows initially held last week. It (~$0.7240) yielded ahead of the weekend, but the Aussie managed to close back above it.   It needs to resurface above $0.7300 to be anything meaningful.  Softer than expected, wage growth may have reinforced the RBA's message to the markets, and the yield of the June 2022 T-bill futures fell seven basis points last week and is now down 31 bp on the month.   Mexican Peso:  Emerging markets currencies remain out of favor in a strong dollar environment.  The JP Morgan Emerging Market Currency Index slumped by more than 2% last week, the most since June.  The Turkish lira collapsed by nearly 11%.  The Indian rupee rose by 0.3%, the strongest in the EM space.  The greenback made a new marginal high in two-and-a-half weeks before the weekend, slightly below MXN20.89.  The momentum indicators are constructive for the dollar, but it is at the upper end of its recent range (~MXN20.12-MXN21.00).  The high for the year was set in March near MXN21.64, and it will come into view when the greenback rises above MXN21.15.   Chinese Yuan:   By shadowing the dollar so tightly, the yuan is dragged higher on a trade-weighted basis in the stronger greenback environment. The yuan is at six-year highs on the basket the PBOC tracks (CFETS).  The PBOC reportedly stressed the importance of exchange risk management ahead of the weekend, and it may be a warning that its willingness to tolerate a stronger yuan is limited.  The yuan slipped an inconsequential 0.12% against the dollar last week.  For nearly the past five weeks, the exchange rate has been mostly confined to a CNY6.38-CNY6.40 range.  It is a fuzzy range and allows for around a big figure in both directions. The index of Chinese companies listed in the US (NASDAQ Golden Dragon Index) fell about 5.7% last week.  The major benchmarks in China, including the CSI 300, posted small gains.  The Hang Seng fell 1.1% last week, and most of that was before the weekend on disappointing earnings from Alibaba (-10.3% in HK).     Disclaimer
Special Podcast: Happy 30th Birthday To Saxo, An Overview Of The Market In Recent Decades And Reflection On Its Future

ChiNext: The growth market that has defied Chinese equity trouble

Peter Garnry Peter Garnry 22.11.2021 14:26
Summary:  ChiNext is up 19% this year while the rest of the Chinese equity market is down highlighting that there is a high quality pocket in China that investors should have on the radar. The ChiNext Index comprises of leading technology companies within battery and medical technology including biotechnology. It is a closed market for most investors but luckily a Hong Kong based asset management is offering a Hong Kong listed ETF providing exposure to this interesting market in China. China has a growth pocket nobody talks about This year has been a rollercoaster ride for Chinese equities. It all started with blistering growth and strong momentum in Chinese equities before rising US interest rates and inflation talks temporarily ended the trade in technology stocks. While technology stocks came back in the developed equity market Chinese equities went from crisis to crisis, first in housing during the summer months and which is still ongoing, to that of an energy crunch like in Europe as energy prices have galloped higher. But there is one pocket in the Chinese equity market that has defied the negative forces of higher energy prices and housing woes, and that is the ChiNext board on the Shenzhen Stock Exchange. ChiNext is up 19% this year highlighting a stunning comeback following a 29% drawdown during the technology correction during February and March. CSI 300, the leading benchmark index of Chinese mainland equities, is down 4% this year, and Hang Seng in Hong Kong is down 6% this year. While ChiNext is the crown jewel in terms of innovation and growth companies within key technology, it has struggled to deliver against Nasdaq 100 which is up 29% this year, and since June 2010, Nasdaq 100 is up 23.2% annualized compared to 13.1% annualized for ChiNext. ChiNext is closed market for foreign investors In recent years China has opened up its capital markets making it easier for foreign investors to invest directly in mainland China equities listed in Shanghai and Shenzhen, but the ChiNext board is still closed land for most investors due to prohibitive rules. In effect it is only accessible for few foreign institutional investors. Luckily the ETF market is providing an opportunity for retail investors to get access to this market through the CSOP SZSE ChiNext ETF (Saxo ticker is 03147:xhkg) managed by CSOP Asset Management which is a Chinese regulated asset management firm based in Hong Kong with $10bn in asset under management as of December 2020. The ETF consists of 160 securities with $110mn in assets and tracking the ChiNext Index and a total expense ratio of 1.16%. The ETF uses a combination of a physical representative sampling and a synthetic representative sampling strategy (swaps), which means that the fund is not holding the underlying index 1:1, but tries minimize the tracking error through sampling. This enables the fund to minimize tracking error while getting better liquidity conditions for investors. The 10 largest positions in the fund constitute 49.3% of the funds market value with Contemporary Amperex Technology (CATL) being the largest position with 19.1% weight and also the biggest company in our battery equity basket. CATL is one of the world’s largest manufacturers of lithium-ion batteries and is becoming China’s crown jewel within the fast-growing and emerging battery industry which will be transformational and essential to the green transformation including electric vehicles. The ETF also provides exposure to China’s largest financial and stock information provider East Money Information with $1.8bn in revenue and growing 82% over the past year. The ETF also gives exposure to some of the most interesting medical technology and biotechnology companies in China. The 10 largest holdings in the CSOP SZSE ChiNext ETF The history of ChiNext and why it will play a major role ChiNext was first discussed in August 1999 in the CPC Central Committee and the State Council during the height of the dot-com bubble. China was looking at the technological change in the US and especially what was going on with the Nasdaq exchange. In August 2000, China decided that the Shenzhen Stock Exchange should prepare to create a second board which should include innovative companies with key technologies in order to support growth industries. The ChiNext board was inaugurated on 23 October 2009. In 2020, more than 800 companies were listed on the ChiNext Market with the combined market capitalization approaching $1trn.
Like the Latest Bond Flick, the US Dollar Has No Time to Die

Like the Latest Bond Flick, the US Dollar Has No Time to Die

Przemysław Radomski Przemysław Radomski 22.11.2021 15:11
While the dollar is on a tear, precious metal stocks have gotten away with it lately. But how long will their resistance last? The USD Index (USDX) After the USD Index’s negative response to the ECB’s monetary policy meeting on Oct. 28, I warned on Oct. 29 that dollar bears were unlikely to celebrate for much longer. I wrote: Based on the rather random comment during the conference, the traders panicked and bought the EUR/USD, which triggered declines in the USD Index (after all, the EUR/USD is the largest component of the USDX). Was the breakout to new 2021 lows invalidated? No. The true breakout was above the late-March highs (the August highs also served as a support level, but the March high is more important here) and it wasn’t invalidated. What was the follow-up action? At the moment of writing these words, the USDX is up and trading at about 93.52, which is just 0.07 below the August high in terms of the closing prices. Consequently, it could easily be the case that the USD Index ends today’s session (and the week) back above this level. You’ve probably heard the saying that time is more important than price. It’s the end of the month, so let’s check what happened in the case of previous turns of the month; that’s where we usually see major price turnarounds. I marked the short-term turnarounds close to the turns of the month with horizontal dashed blue lines, and it appears that, in the recent past, there was practically always some sort of a turnaround close to the end of the month. Consequently, seeing a turnaround (and a bottom) in the USD index now would be perfectly normal. And with the USD Index making quick work of 94, 95, and now 96, the greenback’s rally continues to gain steam. What’s more, the USD Index also surged above its late 2020 resistance and 98 should be the next bullish milestone. More importantly, however, gold, silver, and mining stocks are sensing that something is amiss. For example, while they largely ignored the USD Index’s recent ascent, their negative correlations resurfaced last week (on a very short-term basis, so far, but still). Moreover, while the precious metals’ recent rallies were likely euro-weakness-driven and not USD Index-strength-driven, the dollar basket’s uprising should elicit more pain for gold, silver, and mining stocks over the medium term. To explain, I wrote on Nov. 17: The euro recently declined and the prices of silver and gold recently rallied shortly after dovish comments from the eurozone. Namely, while the expansionary nature of fiscal and monetary decisions in the U.S. might be after its peak (with the infrastructure bill signed even despite high inflation numbers), the eurozone is far from limiting its expansionary (i.e., inflationary) policies, and it was just made clear recently. That was bearish for the euro and bullish for the gold price – as more money (euros in this case) would be chasing the same amount of physical gold. The point here is that it might have been the decline in the value of the European currency that caused gold to rally, and it had little to do with what happened in the USD Index. Don’t get me wrong, most of the time, the gold-USD link is stable and negative. In some cases, gold shows strength or weakness by refusing to move in tune (and precisely: again) with U.S. dollar’s movement. But in this case, it seems that it’s not about the U.S. dollar at all (or mostly), but rather about what happened in the Eurozone and euro recently. As a result, with the USD Index likely to take the lead in the coming months, the precious metals should suffer along the way. For context, the USD Index is approaching overbought territory and a short-term decline to ~95 isn’t out of the question. However, it’s more of a possibility than a given. Moreover, the greenback’s medium-term outlook remains robust, and any short-term pullback is likely a corrective downswing within a medium-term uptrend. Circling back to the euro, I’ve been warning for months that the Euro Index was materially overvalued and that a sharp re-rating would likely unfold. I wrote previously: The next temporary stop could be ~1.1500 (the March 2020 highs, then likely lower). For context, the EUR/USD accounts for nearly 58% of the movement of the USD Index, and that’s why the euro’s behavior is so important. And after the Euro Index sunk to a new 2021 low last week, the European currency has officially fallen off a cliff. To that point, after breaking below the declining support line of its monthly channel, a drawdown to ~111 is likely next in line (which is signaled by the breakdown below its bearish head & shoulders pattern). The Euro Index is near oversold territory and a short-term bounce may ensue, but the bearish medium-term implications remain intact. Please see below: Adding to our confidence (don’t get me wrong, there are no certainties in any market; it’s just that the bullish narrative for the USDX is even more bullish in my view), the USD Index often sizzles in the summer sun and major USDX rallies often start during the middle of the year. Summertime spikes have been mainstays on the USD Index’s historical record and in 2004, 2005, 2008, 2011, 2014 and 2018 a retest of the lows (or close to them) occurred before the USD Index began its upward flights (which is exactly what’s happened this time around). Furthermore, profound rallies (marked by the red vertical dashed lines below) followed in 2008, 2011 and 2014. With the current situation mirroring the latter, a small consolidation on the long-term chart is exactly what occurred before the USD Index surged in 2014. Likewise, the USD Index recently bottomed near its 50-week moving average; an identical development occurred in 2014. More importantly, though, with bottoms in the precious metals market often occurring when gold trades in unison with the USD Index (after ceasing to respond to the USD’s rallies with declines), we’re still far away from that milestone in terms of both price and duration. Again, the recent move higher in the USD Index doesn’t necessarily apply in the case of the above rule, as it was not the strength of the USD but weakness in the euro that has driven it. Likewise, with the USD Index now approaching its long-term rising support line (which is now resistance), a rally above the upward sloping black line below would invalidate the prior breakdown and support a move back above 100. However, with the dollar basket’s weekly RSI (Relative Strength Index) now above 70, a short-term consolidation may ensue. Conversely, 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. However, the medium-term outlook remains profoundly bullish, and gold, silver, and mining stocks may resent the USD Index’s forthcoming uprising. 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 the ones 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 still remains at the dollar’s back. Please see below: The bottom line? With my initial 2021 target of 94.5 already hit, the ~98 target is likely to be reached over the medium term, and the USDX will likely exceed 100 at some point over the medium or long term. Keep in mind, though: we’re not bullish on the greenback because of the U.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, while the USD Index’s 2021 surge caught the consensus by surprise, I’ve been sounding the bullish alarm for many months. And with more strength likely to materialize over the medium term, the ‘death of the dollar’ narrative has been grossly over-exaggerated. Moreover, while gold, silver, and mining stocks recently ignored the greenback’s fervor, history implies that their relative strength won’t last. As a result, more downside will likely confront the precious metals over the next few 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.
More And More Universities Are Including Metavers In Their Education Program

Fixed income market: the week ahead

Althea Spinozzi Althea Spinozzi 22.11.2021 14:23
Summary:  This week it's all about a surge of Covid-19 cases and inflation. The debt ceiling issue will keep long-term yields in check in the United States while spurring volatility in money markets. Lack of collateral and new lockdown measures are also compressing spreads in the Euro area. Yet, policymakers' engagement to the idea of less accommodative monetary policies on both sides of the Atlantic indicates that yields will not remain rangebound for long. Once the lid is lifted, inflationary pressures will push yields higher. Therefore, it's safe to assume a continuous bear flattening of yield curves. US Treasuries: volatility in money markets will keep long-term yields in check. Yet, inflation concerns continue to grow, pointing to higher rates once the debt ceiling issue is resolved. This week, investors will need to focus on the Fed Minutes released on Wednesday, inflation numbers, and the White House's announcement concerning the Federal Reserve Chair nomination. The Fed’s minutes might unveil details regarding the decision that led to tapering this month and whether FOMC members begin to fret about inflationary pressures. Last week, several Fed’s speakers opened up about accelerating tapering and hiking interest rates in 2022. Among them, Fed Vice Chair Richard Clarida called for a discussion to expedite tapering to enable the central bank to hike interest rates sooner. At the same time, if Biden nominates Leal Brainard as Fed Chair, it could advance inflation worries. Brainard is known to be more dovish than Powell. In the case of her nomination, the market could anticipate interest rates to remain low for longer, implying stickier inflation, provoking a selloff in bonds. The Personal Consumption Expenditure Index, one of the inflation data most looked at after the Federal Reserve, will be released on Wednesday. The PCE core deflator index YoY is expected to rise to 4.1%, the highest in more than 31 years. As we mentioned in earlier editions of “Fixed income market: the week ahead”, we expect inflationary pressures to continue to rise and higher rents, housing and wages to make inflation stickier, putting at odds policymakers’ transitory narrative. Therefore, although the US yield curve has already flattened substantially, we cannot expect anything else than more flattening. The only difference is that once the debt ceiling issue is resolved, long term yields will need to rise together with short term yields, putting at risk weaker credits. The debt ceiling will be a crucial topic for December. Janet Yellen has said that the US Treasury will run out of cash soon after the 3rd of December if an agreement over the debt ceiling is not found. However, money markets have started to price a default during the second half of December. Indeed, last week's 4-week T-Bills auction was priced with a yield of 0.11%, more than double the Reverse Repurchase facility rate. We expect volatility in money markets to continue to remain elevated until the debt ceiling is lifted or suspended. Until then, the long part of the yield curve will serve as a safe haven causing yields to remain compressed. Yet, once the debt ceiling hurdle has cleared, long-term rates will resume their rise. European sovereigns: lack of collateral and a surge in Covid-19 cases will keep yields compressed. Yet, something is changing among policymakers. In Europe, governments are imposing new lockdown measures due to increasing Covid-19 cases, causing yields to drop significantly. Yet, inflationary forces have already been set into motion. Another lockdown might exacerbate inflation further as consumption will switch from services to goods, putting more pressure on prices. Meanwhile, policymakers have started to open to the possibility that upside inflation risk might remain throughout winter. Therefore, near-term hikes expectations are unlikely to reverse despite new lockdown measures. Yet, lack of collateral in the euro area contributes to keeping short-term yields compressed across the euro area, including the periphery. At the same time, swaps with the same maturity have widened as the market prices earlier interest rate hikes. Demand for collateral will remain strong until the end of the year. However, 2022 opens up to widening risk, as demand for bonds will start to wane, and the front part of the yield curve will shift higher according to interest rate hikes expectations. Source: Bloomberg and Saxo Group. However, it looks too early to call for higher yields in the Euro area, as a lot still depends on yields in the US and December's ECB meeting. Suppose more governments across the euro area impose lockdown measures. In that case, the central bank might look to extend the PEPP bond-buying program after March, compressing yields further. The next few weeks preceding Christmas are going to be critical to set direction in European sovereigns. Economic calendar: Monday, the 22nd of November  Spain:  Balance of Trade United States: Chicago Fed National Activity Index, Existing Home Sales (Oct),  2-year Note Auction, 5-year Note Auction Eurozone: Consumer Confidence Flash (Nov) Tuesday, the 23rd of November Germany: Markit Composite, Manufacturing and Services PMI Flash (Nov) Eurozone: Markit Composite and manufacturing PMI Flash (Nov) United Kingdom: market/CIPS Composite, Manufacturing and Services PMI Flash (Nov) United States: Markit Manufacturing PMI flash (Nov), NY Fed Treasury Purchases TIPS 7.5 to 30 years, 2-year FRN Auction, 7-year Note Auction Wednesday, the 24th of November New Zealand: Interest Rate Decision, RBNZ Press Confidence France: Business Confidence Germany: Ifo Business Climate (Nov), 15-year Bund Auction United States: Durable Goods Orders (Oct), GDP Growth Rate QoQ 2nd Est (Q3),  Continuing Jobless Claims, Corporate Profits QoQ Prel (Q3), Durable Goods Orders (Oct),  Goods Trade Balance (Oct), Initial Jobless Claims, Jobless Claims 4-week Average, retail Inventories Ex Autos (Oct), Core PCE Price Index (Oct), Michigan Consumer Sentiment Final (Nov), PCE Price Index (Oct), Personal Income (Oct), Personal Spending (Oct), FOMC Minutes, 4-week and 8- week bill auction Thursday, the 25th of November New Zealand: Balance of Trade Japan: Foreign bond Investment, Coincident Index Final, Leading Economic Index Final (Sep) Germany: GDP Growth Rate YoY Final (Q3), GfK Consumer Confidence (Dec) Sweden: Monetary Policy Report, Riskbank Rate Decision France: Unemployment Benefit Claims Canada Average weekly earnings YoY Friday, the 26th of November Australia: Retail Sales MoM Prel (Oct) South Korea: Interest Rate Decision France: Consumer Confidence Switzerland: GDP Growth Rate YoY (Q3) Italy: Business Confidence (Nov)
Oil continues to correct the rise of the previous 12 months

Oil continues to correct the rise of the previous 12 months

Alex Kuptsikevich Alex Kuptsikevich 22.11.2021 13:07
Oil is adding around 1% on Monday after posting the 4th week of back-to-back decline, during which WTI lost almost 12%, and Brent nearly 11%. Nevertheless, the US and oil-consuming countries continue to put verbal pressure on quotations, discussing the possibility of selling off strategic stocks to bring down the price. These media reports put pressure on quotations because of speculation that the USA, China, India, and Japan – the biggest oil importers – could bring prices down in the short term by overly decisive actions. The FxPro Analyst team added that a jump in coronavirus cases in Europe, leading to stricter lockdowns and undermining demand, is taking away the support for Crude. In parallel to this, OPEC+, albeit too slow (according to importing countries), is still increasing production quotas. The momentum of the correction after a year-long rally may not attract significant buyers demand until a drop to $75 for Brent in a moderately negative scenario and $67 in a sharp rebalancing towards surplus. For WTI, the $73 area (2018 highs) and $65 (round level and 2019 peak area) act as meaningful reference points. However, the global trend in oil is still on the bullish side if we look beyond the medium-term fluctuations. In the USA itself, the recovery in drilling activity has been notably slower than since the "bottom" in 2009 and 2016. In contrast to the price shock in 2014-15, the collapse in quotations in 2020 coincided with the so-called energy transition. The focus of investors and policymakers in developed countries has shifted to alternative energy sources. While we have seen a steady increase of 150% in the number of rigs in the US since last September, production has risen by 4% as most of the new rigs compensate for depleted wells. It is also possible that some of the rigs are being made redundant and, it may take up to 2 years until the rate of production growth increases in any notable way. In the longer term, we see more supply and demand contraction risks for oil, which is harmful to revenues and share prices of oil producers. That said, oil prices may well remain at high levels for many more years until alternative energy becomes more efficient and reliable.
Oil attempts to recover amid rising demand concerns

Oil attempts to recover amid rising demand concerns

Walid Koudmani Walid Koudmani 22.11.2021 11:24
Oil attempts to recover amid rising demand concerns Despite oil prices making significant gains recently, with WTI reaching a multi year high of $85.42 before pulling back, we have seen an increase in volatility as different viewpoints appear to be facing off. On one hand, we have OPEC and Russia who have advised against an increase in oil production as they foresee a fall in demand towards the end of the year despite the ongoing pressure, which has been caused by a faster than expected post pandemic economic recovery. On the other hand, we have the US and Japan who have been pushing for an increase in production and even announced they may be tapping into strategic reserves in order to cool off energy prices which have further contributed to the ongoing inflation concerns. At the moment, the market is in a difficult position as current supply concerns and price increases are being downplayed by a potential future deficit while it seems that traders are starting to agree with the latter viewpoint as we see the introduction of stricter measures to combat a rise in covid-19 cases keeping oil prices at the lowest level in over a month.  European stock markets start the week slightly higher After pulling back from the recent all time high at the end of last week, the DAX started the week trading slightly higher and is currently hovering around last week's close of 16160 points. While this will be a shorter week for US stock markets due to the Thanksgiving holiday on Thursday, traders will be keeping an eye out for the new FED chair announcement from president Biden along with the ongoing lockdown situation which appears to be escalating across Europe and could lead to further uncertainty along with potentially causing market major corrections if it were to worsen. Download our Mobile Trading App:   Google Play   App Store  
Intraday Market Analysis – USD Bounces Back

Intraday Market Analysis – USD Bounces Back

John Benjamin John Benjamin 22.11.2021 08:40
GBPUSD hits resistance The pound pulled back after Britain’s retail sales registered a steeper drop to -1.3% in October. The pair has met stiff selling pressure in the supply zone around 1.3510, a support that has turned into resistance after a failed rebound. An oversold RSI may cause a limited rebound. However, a bearish MA cross on the daily chart suggests that sentiment is still pessimistic. 1.3380 is a key support to keep the sterling afloat. A bearish breakout may trigger an extended sell-off to last December’s lows around 1.3200. USDCAD breaks higher The Canadian dollar struggles after a contraction in September’s retail numbers. The US dollar bounced off the resistance-turned-support at 1.2580. This is a sign that the bulls are still in control. A bullish MA cross on the daily timeframe confirms the directional bias for the next few days. The daily resistance at 1.2770 would be the next target. Its break would lead to a test of the double top at 1.2900. In the meantime, the RSI’s overextension has temporarily held the bulls back. We can also expect buying interest during dips. GER 40 struggles for support The Dax 40 tumbles as lockdowns across Europe hurt sentiment. The RSI’s overbought situation on the daily chart has made buyers cautious in pursuing high valuations. On the hourly chart, a bearish RSI divergence suggests a deceleration in the upward momentum. Then a dip below 16200 confirms weakness in the rally, prompting leverage positions to liquidate. The psychological level of 16000 is a congestion area as it coincides with last August’s peak and the 20-day moving average. 16300 is now a fresh hurdle.
Electrification and urbanisation will drive growth in copper

Electrification and urbanisation will drive growth in copper

Peter Garnry Peter Garnry 22.11.2021 08:26
Summary:  Copper is an essential metal in our green transformation driven by electric vehicles and upgrades to our electric grid infrastructure. The ongoing urbanisation in the world is also driving construction which is one of the key demand drivers for copper. The demand outlook looks strong, but how can investors get exposure to copper. We explore the different options and highlights specifically six miners with high exposure to copper. The long-term growth drivers of copper The green transformation will electrify the global economy as cars go electric and more homes in colder areas will switch from natural gas as heating source to that of air to water heat pumps. In warmer parts of the world we will continue to see an acceleration in air conditioners to cool homes. The main usage of refined copper is for electrical applications, but it is also used in housing (pipes and fittings), cars, telecommunication and industrial machines. Copper has the second highest thermal conductivity at room temperature among pure metals and is thus the preferred metal used in electrical applications. As the world electrifies in the name of the green transformation and rapid urbanization continues in Asia, Africa, and South America, copper will continue to enjoy strong annual growth rates. How to get exposure to copper? Copper has been rebranded as a green metal because of its importance for the green transformation and investors are increasingly asking us how to invest in copper. The most direct way is of course to invest in high grade copper futures on COMEX (part of CME Group) with the current active contract being the Mar 2022 contract (Saxo ticker: HGH2), but the contract has a contract value of around $106,537 at current level making it inaccessible to most retail investors. One could also invest through CFD on futures (Saxo ticker on the Mar 2022 is COPPERUSMAR22) where the investor could buy 100 pounds of copper instead of 25,000 pounds in the futures reducing the contract size to $425. However, getting exposure through CFDs and futures the investor must regularly roll the contract to the next active contract, and the investor could also incur financing cost increasing the drag on performance. The chart below shows the continuous futures contract on high grade copper since 2002. Source: Saxo Group Few miners offer pure exposure to copper Another way to get exposure to copper that removes the difficulties of rolling futures or CFD contracts is to invest in mining companies that extract or refine copper. The table below shows 16 mining companies with exposure to copper with Codelco, the largest copper producer in the world, absent from the list as the Chilean miner is only listed in Chile and thus not investable for our clients. The copper mining industry has delivered a median total return in USD of 132.6% over the past five years beating the global equity up 105% in the same period. The rising copper prices the past year driven by investors positioning themselves in green metals (defined as metals that will play a key role in the green transformation) which in turn has pushed up revenue in the industry by almost 40%. Sell-side analysts are generally bullish on copper miners with a median upside of 16% from current levels. In our view investors should select one or two copper miners to get exposure and avoid the ETFs on the industry as they are too broad-based and lack the pure exposure profile needed to play the copper market. Name Market cap (USD mn) F12M EV/EBITDA Revenue growth (%) Price-to-target (%) 5Y return (USD) Revenue from copper (%) Antofagasta PLC 18,871 5.1 43.8 3.4 166.6 84.8 First Quantum Minerals Ltd 14,962 5.1 41.9 20.9 111.3 84.2 Southern Copper Corp 45,944 8.6 39.7 3.1 128.9 81.6 KGHM Polska Miedz SA 7,026 3.8 28.3 26.4 80.0 73.8 Jiangxi Copper Co Ltd 9,843 7.2 44.6 37.8 27.3 71.0 OZ Minerals Ltd 6,397 7.6 38.7 -6.1 288.4 60.0 Glencore PLC * 65,890 4.5 -7.5 13.9 78.2 39.0 Boliden AB 9,291 5.1 26.2 3.7 68.1 35.0 Freeport-McMoRan Inc 57,080 5.7 55.5 13.2 193.3 33.7 Teck Resources Ltd 14,468 3.9 28.7 19.9 22.0 27.0 BHP Group Ltd 131,046 4.0 41.7 18.6 136.4 26.0 Zijin Mining Group Co Ltd 39,925 8.8 27.4 52.1 396.4 22.7 Anglo American PLC 47,342 3.5 59.0 15.7 262.8 22.3 MMC Norilsk Nickel PJSC 47,479 5.1 27.1 13.5 191.1 20.6 Rio Tinto PLC 98,497 3.6 39.5 15.8 149.2 11.5 Vale SA 60,329 2.5 77.2 87.6 111.4 5.5 Aggregate / median 674,389 5.1 39.6 15.7 132.6 34.4 Source: Bloomberg and Saxo Group* EBITDA contribution as Glencore does not breakdown revenue split on metals As the table also show, there is no such thing as pure exposure to copper except for futures, options and CFDs on the underlying copper. The miner with the highest revenue exposure to copper is Antofagasta with 84.8% revenue share from copper extraction and refining. Most copper miners also extract gold and silver as part of their copper operations. Out of the 16 copper miners in our list, only 6 of these miners have more than 50% of revenue coming from copper extraction and refining. Outlook and risks High grade copper futures have been range trading for more than half a year as slowing demand out of China due to a slowdown in housing construction has weighed on the demand side. On the positive side inventories have been tight in copper which has helped support the copper price and the global pipeline of new copper mines, but also potential tax charges in Chile and Peru (roughly around 40% of global supply) could negative impact supply and keep copper prices high. The annualized growth rate in global refined copper demand has been around 3% in the period 2009-2020. China has for many years been the key driver of demand growth for copper, but going forward electrification (electric vehicles and air-to-water heat pumps and urbanization in India will begin to play a bigger marginal role on demand creating a more steady and diversified demand picture. In 2022, demand outside China will be driven by construction, grid infrastructure, and transport. Another risk to copper demand is significantly higher interest rates next year as that would curtail growth in construction which is interest rate sensitive.
Ever Thought About Biofuels to Diversify Your Portfolio?

Ever Thought About Biofuels to Diversify Your Portfolio?

Sebastian Bischeri Sebastian Bischeri 19.11.2021 16:49
How do you feel about adding a broader range of stocks to our energy investment portfolio watchlist? Let’s see what we can do! By the way, feel free to send us your questions or topics that you would like us to write about in the forthcoming editions, so we’ll try our best to answer them! Trading positions are available to our premium subscribers. First, let’s quickly define what biofuels are: A biofuel is a liquid or gaseous fuel derived from the transformation of non-fossil organic matter from biomass, for example, plant materials produced by agriculture (beets, wheat, corn, rapeseed, sunflowers, potatoes, etc.). So, it is considered a source of renewable energy. The combustion of biofuels produces only carbon dioxide (CO2) and steam (H2O) and little or no nitrogen and sulfur oxides. Therefore, biofuels – as being at the crossroads between energy and agricultural commodities – respond to economic drivers (crops/supply, demand, dollar strength, reserves, etc.) and geopolitics of both industrial sectors. Furthermore, they allow their producing countries to reduce their energy dependence on fossil fuels. Key reasons to invest in these alternative energy sources: Given the recent surge of oil and gas prices, biofuels have become somehow more attractive, and consequently one could witness a slight shift in demand from fossil to non-fossil fuels. This was also a central topic of talks during the recent United Nations Conference of the Parties (COP26), which recently took place in Glasgow (Scotland), and where world leaders finally agreed to preliminary rules for trading carbon emissions credits. In addition, as we all know, the combustion of fossil fuels contributes to greenhouse gas (GHG) emissions. Regarding biofuels - the carbon emitted to the atmosphere during their combustion has been previously fixed by plants during photosynthesis. Thus, the carbon footprint seems to be a priori neutral. Stock Watchlist (Continued) In the first article, we started a watchlist with some major energy stocks. In the second article, we added some more spicy assets (MLPs). Today, let’s update it with some biofuel-based stocks! As usual, our stock picks will be shared through that link to our dynamic watchlist which will be updated from time to time, as we progress through this portfolio construction process... Below is an example of some indicative metrics: Daily Technical Charts Figure 1 – Green Plains, Inc. (GPRE) Stock (daily chart) Figure 2 – Aemetis, Inc. (AMTX) Stock (daily chart) Figure 3 – Tantech Holdings Ltd. (TANH) Stock (daily chart) In summary, those biofuel-related stocks may present some benefits to diversifying your energy portfolio while covering some alternative fuels as well. As always, we’ll keep you, our subscribers well informed. Like what you’ve read? Subscribe for our daily newsletter today, and you'll get 7 days of FREE access to our premium daily Oil Trading Alerts as well as our other Alerts. Sign up for the free newsletter today! Thank you. Sebastien BischeriOil & Gas Trading Strategist * * * * * The information above represents analyses and opinions of Sebastien Bischeri, & 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, Sebastien Bischeri and his associates cannot guarantee the reported data's accuracy and thoroughness. The opinions published above neither recommend nor offer any securities transaction. Mr. Bischeri is not a Registered Securities Advisor. By reading Sebastien Bischeri’s 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 a high risk of loss. Sebastien Bischeri, 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.
Inflation Risk: Milton Friedman Would Buy Gold Right Now

Inflation Risk: Milton Friedman Would Buy Gold Right Now

Arkadiusz Sieron Arkadiusz Sieron 19.11.2021 16:50
Powell maintains that inflation is transitory, but the monetary theory of inflation suggests otherwise. So, elevated inflation could stay with us!, Some economists downplay the risk stemming from elevated inflation, saying that comparisons to the 1970s style stagflation appear unfounded. They say that labor unions are weaker and economies are less dependent on energy than in the past, which makes inflationary risks less likely to materialize. Isabel Schnabel, Board Member of the European Central Bank, even compared the current inflationary spike to a sneeze, i.e., “the economy’s reaction to dust being kicked up in the wake of the pandemic and the ensuing recovery”. Are those analysts right? Well, in a sense, they are. The economy is not in stagnation with little or no growth and a rising unemployment rate. On the contrary, the US labor market is continuously improving. It’s also true that both the bargaining power of workers and energy’s share in overall expenditure have diminished over the last fifty years. However, general inflation is neither caused by wages nor energy prices. Higher wages simply mean lower profits, so although employees can consume more, employers can spend less. If wages are set above the potential market rates, then unemployment emerges - not inflation. Similarly, higher energy prices affect the composition of spending, but not the overall monetary demand spent on goods and services. It works as follows: when the price of oil increases, people have to spend more money on oil (assuming the amount of consumed oil remains unchanged), which leaves less money available for other goods and services. So, the overall money spent on goods won’t change. As a consequence, the structure of relative prices will change, but widespread prices increases won’t happen. In other words, Milton Friedman’s dictum remains valid: “Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output”. It’s quite a simple mechanism, even central bankers should be able to understand it: if the stock of goods remains unaltered while the stock of money increases, this, as Frank Shostak put it, “must lead to more money being spent on the unchanged stock of goods – an increase in the average price of goods” Let’s look at the chart below, which displays the annual growth rates in the broad money supply (M2, red line) and in the CPI (green line). We can notice two important things. First, in the 1970s, the pace of broad money supply growth was relatively high, as it reached double-digit values at some point. As a consequence, inflation accelerated, jumping above 10% for a while. In other words, stagflation was born. Since then, the rate of growth in the money supply never reached double-digit numbers on a prolonged basis, including the Great Recession, so high inflation never materialized. And then the pandemic came. In March 2020, the money supply growth rate crossed the 10% threshold and never came back. In February 2021, it reached its record height of 27.1%. The pace of growth in the M2 money aggregate has slowed down since then, dropping to a still relatively high rate of 13%. This is a rate that is almost double the pre-pandemic level (6.8% in February 2020) and the long-term average (7.1% for the 1960-2021 period ). So, actually, given the surge in the broad money supply and the monetary theory of inflation, rapidly rising prices shouldn’t be surprising at all. Second, there is a lag between the money supply growth and the increase in inflation rates. That’s why some analysts don’t believe in the quantity theory of money – there is no clear positive correlation between the two variables. This is indeed true – but only when you take both variables from the same periods. The correlation coefficient becomes significant and positive when you take inflation rates with a lag of 18-24 months behind the money supply. As John Greenwood and Steve Hanke explain in opinion for Wall Street Journal, According to monetarism, asset-price inflation should have occurred with a lag of one to nine months. Then, with a lag of six to 18 months, economic activity should have started to pick up. Lastly, after a lag of 12 to 24 months, generalized inflation should have set in. If this relationship is true, then inflation won’t go away anytime soon. After all, the money supply accelerated in March 2020 and peaked in February 2021, growing at more than four times the “optimal” rate that would keep inflation at the 2-percent target, according to Greenwood and Hanke. In line with the monetarist description, the CPI rates accelerated in March 2021, exactly one year after the surge in the money supply. So, if this lag is stable, the peak in inflation rates should happen in Q1 2022, and inflation should remain elevated until mid-2022 at least. What does it mean for the gold market? Well, if the theory of inflation outlined above is correct, elevated inflation will stay with us for several more months. Therefore, it’s not transitory, as the central bank tells us. Instead, inflation should remain high for a while, i.e., as long as the money supply growth won’t slow down and go back below 10% on a sustained basis. What’s more, the velocity of money, which plunged when the epidemic started, is likely to rise in the coming months, additionally boosting inflation. So, I would say that Milton Friedman would probably forecast more persistent inflation than Jerome Powell, allocating some of his funds into the yellow metal. Gold is, after all, considered to be an inflation hedge, and it should appreciate during the period of high and rising inflation. Although so far gold hasn’t benefited from higher inflation, this may change at some point. Actually, investors’ worries about inflation intensified in October, and gold started to show some reaction to the inflationary pressure. My bet is that the next year will be better for gold than 2021: the Fed’s tightening cycle will already be inaugurated, and thus traders will be able to focus on inflation, possibly shifting the allocation of some of their funds into gold as a safe-haven asset. 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.
With Gold and the Buck, as Told, You're in Luck

With Gold and the Buck, as Told, You're in Luck

Mark Mead Baillie Mark Mead Baillie 22.11.2021 08:17
The Gold Update by Mark Mead Baillie --- 627th Edition --- Monte-Carlo --- 20 November 2021 (published each Saturday) --- www.deMeadville.com As time is at a bit of a premium for penning this week's missive, (even as Gold is priced at a massive discount by valuation), let's jump right in. The macro question at large we oft receive is: â–  "How come Gold isn't much higher with all the money printing?" Macro indeed per the above Gold Scoreboard, price having settled yesterday (Friday) at $1847, just 46% of our valuation level of $3993. To be sure per the right-hand panel Gold is, on balance, in ascent toward chasing the unconscionable rise in the U.S. "M2" money supply; yet the gap from here to up there remains HUGE! The micro question of late we oft receive is: â–  "How come Gold is going up even if the Dollar is also going up?" Micro indeed as such phenomenon does on occasion occur given (for the ad nauseath time) Gold plays no currency favourites. To be sure, both Gold and the Buck have been on the rise per their percentage tracks for the 15 trading days thus far in November. Here as shown, Gold is +3.5% and the Dollar Index is +2.1%. Yes, Gomer, it really can happen: In fact "surprise, surprise, surprise" if measuring from mid-year 2014, (albeit their respective routes hardly are in linear harmony), Gold is +39.7% and yet the Dollar Index is +20.4%. So even more broadly there, no directional favoritism. And yet from that date some seven years ago, the supply of Gold is only +10.7% whereas the U.S. "M2" money supply is +88.4%. Further with specific respect (or lack thereof) to the Dollar, recall from Econ 101 class that more of something (in this case much more) makes it worth less, arguably in the Dollar's case worthless. And yet an inevitable -- some say forcibly imminent -- Federal Reserve interest rate increase (versus, for example, sovereign bank rates in Europe still seen as staying essentially negative for the foreseeable future), is therefore getting the Dollar a bid such as to push the Buck into the lead of the currencies' so-called Ugly Dog Contest. 'Course, attempting to explain irrationality is an exercise in same, in this case more Dollars nonetheless being worth more whatevers. And even irrespective of inflation, we read speculation this past week of the €uro ultimately collapsing ... and being replaced by the Dollar. "What?" But then, could such dual-continent currency still be deemed a "Federal Reserve Note"? Either way, we wouldn't recommend your losing sleep over this whimsy. For if you've Gold, you're fine. And looking .9999 fine is our chart of Gold's weekly bars with their parabolic long trend, now neatly in place these past three weeks. Yes, Gold put in an acceptable net loss for this recent week after having been up for five of the prior seven. However, the daily table therein of our BEGOS Markets "Breakout?" suggestions popped up last evening with "Sell" for both precious metals. So some further slipping may be seen into the ensuing week; yet on balance by the bars' structure in the chart, the 1800s not only appear safe, but the dashed regression trend line is now more perceptively rotating from negative toward positive. And that would tie in well (as historically noted last week) with Gold reaching 1971 during this new parabolic Long run: Thus having awakened the dip buyers, let's turn to the StateSide economy, by which our Economic Barometer had a sound week and sufficiently so as to put it on pace toward recording its second best month year-to-date. For the week's 14 incoming metrics, 12 were improvements over the prior period, the only two negatives being inflationary October Import Prices (even ex-Oil) and a slight slowing in that month's Housing Starts. But the latter was mitigated by growth in Building Permits, plus a firm increase in November's National Association of Home Builders Index. November also scored marked increases for both the New York State Empire and Philly Fed Indexes. Other positives included October's Retail Sales, Industrial Production, Capacity Utilization, and the Conference Board's lagging read of Leading Indicators. "'Tis all good, right?" Well, just bear in mind there, Bunky, that much of Q3's Gross Domestic Product "growth" was mitigated by a very high Chain Deflator, (i.e. inflationary rather than real growth): And as to Q3 Earnings Season, it just ended as follows: for the S&P 500, 80% of reporting constituents beat both estimates and prior period results. 'Tis rare when the latter keeps up with the former. However more broadly, 1,440 other mid-cap and smaller companies by our tabulation found just 56% having actually improved over 2020's Q3 shutdown period. That's an uh-oh... But in toto, great economics (arguably inflationarily but not really) + great earnings (by estimates but not always actual growth) = S&P 500 all-time highs. Moreover, money is pouring into the stock market per the website's S&P Moneyflow page: "Let's all buy high!" 'Tis quite extraordinary. "So then maybe this a blow-off top, mmb..." Squire, we long ago stopped counting the number of would-be S&P blow-off tops. Remember: as we've herein put forth for many-a-year, this is now the age of the stock market being the Great American Savings Account. "You have to be IN!" they say. "Gold's for the BIN!" they say. And then there's the ever-annoying individual blurter: "I bought X back at blah and am now making BLAH!" For whom we have this important reminder: the market capitalization of the S&P 500 as of Friday night is $41.4 trillion; yet the liquid M2 money supply of the U.S. is but half that at $21.4 trillion. So when it all goes wrong, good luck in getting out with something. Meanwhile amongst it all going good, we read that a record number of StateSide workers are quitting their jobs, the notion being they can do better doing something else. Watch for this great mania of "There's a better way!" and "My stocks are so up!" ultimately ending with "What was I thinking?" Then from the "We Knew This Was Coming Dept." it seems just mere weeks go by before yet again U.S. Treasury Secretary Janet "Old Yeller" Yellen has to chase down the Legislature 'cause she's run out of dough to make the country go. For sanity's sakes: "Got Gold?" Hopefully as the Fed Chair passes to Lael "The Brain" Brainard, she and the Treasury Secretary can sort it all out. (See too: "In Like Flint", 20th Century Fox, '67). From steely flint to a wee loss of glint describes at present our precious metals. Per the two-panel graphic below, we see on the left a bit of a topping pattern in the daily bars, but again with structural support still well within the 1800s. Then on the right in Gold's 10-day Market Profile, 1864 clearly is the dominant price traded across these past two weeks: Silver, too, shows similar toppiness per her daily bars (at left) with the low 24s/high 23s as supportive; then in her Profile (at right), 25.15 is where the bulk of Sister Silver's action has been: In sum, we see a bit of near-term pullback for Gold and Silver, but nothing really materially daunting, especially given the notion of 1971 during Gold's current parabolic up run; (you'll recall from a week ago, arriving at that level equates to the median gain of the 43 prior parabolic Long trends since the year 2001). And at some point -- you know, and we know, and everyone from Bangor, Maine to Honolulu and right 'round the word knows that -- the Buck ultimately shall run out of luck. Indeed to that end (and so much more), in having opened with a couple of questions, let's close with one that came in this past week from a highly-valued publisher of The Gold Update: "Do you think $1900 is nigh?" Our response in kind: "$4000 is nigh." Cheers! ...m... www.deMeadville.com www.deMeadville.com
Best Pick for Corona Woes

Best Pick for Corona Woes

Monica Kingsley Monica Kingsley 22.11.2021 15:49
S&P 500 stumbled as value plunged – corona fears are back as Austria lockdown might very well be followed soon by Germany. The mood on the continent is souring, and coupled with accelerating German inflation data, helping to underpin the dollar. Overall, the reaction reminds me of the corona market playbook of Feb-Mar 2020 when I aggresively took short positions, riding them all the way down to the Mar 23 bottom. So, why am I not beating the bearish drum today as well? We have a lot of incoming stimulus (both monetary and fiscal), the economy is slow but the yield curve hasn‘t inverted the way it did in 2019 – make no mistake, we‘re in a rate raising cycle (even if the Fed didn‘t move, the markets would force it down the road). I know, pretty ridiculous notion with 10-year yield at 1.54% and Oct YoY CPI at 6.2% - but the rates being even more negative elsewhere, help to explain the dollar 2021 resilience. That‘s the bullish side to last week‘s bearish argument. What gold and silver are sniffing out, is that the Fed would have to reverse course once the tapering effects start biting some more – not now, with still more than $100bn monthly addition. Cyclicals and commodities that had massively appreciated vs. year ago (oil doubled), are feeling the pinch of fresh economic activity curbs speculation in spite of the polar shift of U.S. strength in energy of 2019 and before. Begging the OPEC+ to increase production might not do the trick, and with so much inflation already in (and still to come), the key investment theme is of real assets strength. Precious metals have broken out, are no longer an underdog, and the inflation data will not decelerate for quite a few months still. And even as they would, it would come at a palpable cost to the real economy, and the resolute fresh stimulus action wouldn‘t be then far off. As I wrote in Apr 2020, it‘s about the continuous stimulus that‘s the go-to response anytime the horizon darkens, for whatever reason. Wash, rinse, repeat. Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 bulls still have the upper hand, and value recovery accompanied by good tech defence of high ground gained, is the awaited mix. The market breadth is narrowing, and needs to be reversed to give the bulls more breathing room. Credit Markets Once corona returns to the spotlight, bets on „reversion to the mean“ in credit markets are off. Weakening data get more focus, and flight to safety is on, puncturing the trend of rising yields that would inevitably lead to yield curve control. Gold, Silver and Miners It‘s as if the gold and silver bulls don‘t trust the latest rally – I think that‘s a mistaken belief for we have turned the corner, and precious metals are about to shine – of course, invalidating the latest miners weakness in the process. Crude Oil Crude oil bulls didn‘t recover from Friday‘s spanner in the works, and while the dust hasn‘t settled, black gold is prone to an upside reversal at little notice. I‘m not overrating the oil index weakness. Copper Copper smartly recovered, moving at odds with the CRB Index, which I treat (especially given Friday‘s Austria news repercussions) as a vote of confidence that the economy isn‘t rolling over to a deflationarry hell (pun intended). Bitcoin and Ethereum Bitcoin and Ethereum are still going sideways in this correction, but today‘s lower knot is encouraging. The consolidation though still appears to have a bit further to go in time. Summary S&P 500 bulls keep hanging in there, and the waiting for bonds to come to their senses might take a while longer. Tech keeps cushioning the downside, and we haven‘t peaked in spite of the many warnings. Value and Russell 2000 upswings would be good confirmations of the stock bull market getting fresh fuel. Precious metals would have the easiest run in the weeks ahead – commodities in general not so much. Their breather is though of a temporary nature as all roads lead to real assets. 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.
Intraday Market Analysis – Nasdaq Hits Resistance

Intraday Market Analysis – Nasdaq Hits Resistance

John Benjamin John Benjamin 23.11.2021 09:20
NAS 100 pulls back Investors took profit after Jerome Powell’s renomination as US Federal Reserve Chairman. The tech index saw an acceleration in its rally after a break above the previous peak (16450). Strong momentum suggests that buyers are committed to keeping the uptrend intact after a brief pause. However, the RSI’s triple top in the overbought area indicates exhaustion, and a fall below 16550 has triggered a correction. 16300 is the next support from a previous supply zone. A rebound needs to clear 16750 before the rally could resume. AUDUSD struggles for support China’s property slowdown and lower commodity prices weigh on the Australian dollar. The pair has given up most of its gains from the October rally, a sign that support is hard to come by. Nonetheless, a series of lower lows has attracted trend followers’ interest in maintaining the status quo. 0.7220 is an intermediate support. An oversold RSI may prompt the short side to cover, raising bids in the process. However, the bulls will need to lift offers around the former support at 0.7300 before they could expect to turn the tables. NZDJPY seeks support The New Zealand dollar remains under pressure after disappointing retail sales in Q3. The kiwi is seeking support after a surge above last May’s peak at 81.20 led the daily RSI into an overbought situation. Short-term sentiment remains bearish as the pair struggles to achieve a new high. 80.55 is a major resistance after the bulls’ multiple failed attempts. A bullish breakout may pave the way for a reversal towards 82.00. Otherwise, a drop below 79.50 would send the pair towards September’s high at 78.50.
All alone with bitcoin

All alone with bitcoin

Korbinian Koller Korbinian Koller 23.11.2021 11:06
With this psychological burden, you want to stack your odds as good as possible to gain an edge for balance. Bitcoin provides such advantages. The inherent volatility allows for follow-through after an entry. In other words, one gets good risk/reward-ratios in midterm plays on bitcoin. Also, necessary for the long-term time frame player since hodling has another psychological hurdle that piled on top can be devastating. You won’t find many traders who bought a bundle of bitcoin when it traded at a dollar and are still holding it without ever having sold or rebought some. BTC in US-Dollar, Quarterly Chart, the Doji explosion: Bitcoin in US-Dollar, Quarterly chart as of November 23rd, 2021. The quarterly chart of bitcoin shows how explosive moves to the upside can be. If you look at the yellow lines, you will see that a small Doji builds after a retracement, and then prices explode within the next quarter like rockets. This trading behavior provides for sensational risk/reward-ratios. The quarterly chart shows a bullish quarter. Even though all-time highs have been rejected, we see the year ending on a bullish note. The great thing about this self-directed profession, on the other hand, is that you get all the credit. Work directly translates into money, without the typical step in between, selling a product or a service. If you are good at what you are doing in the trading/investing arena, rewards can be more than plentiful. No gift baskets need to be sent to a boss or coworker. True rewards for arduous work to yourself. A very self-fulfilling profession indeed. BTC in US-Dollar, Monthly Chart, most often trending: Bitcoin in US-Dollar, Monthly chart as of November 23rd, 2021. The monthly chart illustrates the steepness of the trend, and yellow lines provide a possible long reload opportunity, which will take all-time highs out next year. Another benefit for individual traders choosing to trade bitcoin is its unique personality of trending much more than most trading instruments. This unique feature adds a massive edge to a trader’s trading arsenal. BTC in US-Dollar, Weekly Chart, freeing investment capital fast: Bitcoin in US-Dollar, weekly chart as of November 23rd, 2021. But this isn’t all. From a trading perspective, bitcoin supports the unsupported individual in comparison to gold or silver as alternate wealth preservation tools due to its speed. Risk is the most defining aspect for a trader, and consequently, capital exposure time is the most crucial aspect. After all, the longer money is in the market, the more exposed it is, let’s say, to unexpected news and six sigma events. Market money parked cannot produce elsewhere and is also emotionally draining. No such thing in bitcoin.A look at the weekly time frame illustrates what we mean by this. It took less than eight weeks for bitcoin to gain staggering percentage moves within the first and second leg in this steep regression channel up. We also just entered a low-risk entry zone again for a third leg to mature. In short, you are all alone with bitcoin, but at least you picked the most ideal alliance with this trading vehicle to stack the odds in your favor. All alone with bitcoin: The business of market play is unique. You’re not learning this skill in school, mentors are hard to come by, and it isn’t a group sport. It is advisable to seek out a community of like-minded traders like our free telegram channel, since spouses rarely can comprehend the steepness of the learning curve and the challenges of constant self-reflection and pain until the consistency is mastered.  While one typically can team up and is supported within a group at the mastery level required, it’s a solo sport in trading.  Statistics support that the likeliest reason for failure in this business is underestimating the time required to acquire all the important skills necessary for success. New traders run either out of money or patience.  The press makes it look so easy, and the fact that all one needs to do is press a button doesn’t help towards a more respectful attitude. Yet, the mere truth is that it is one of the most demanding businesses to find oneself into. 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 subscribe to our free newsletter. This article does 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 Korbinian Koller|November 23rd, 2021|Tags: Bitcoin, bitcoin consolidation, crypto analysis, Crypto Bull, crypto chartbook, DeFi, low risk, quad exit, technical analysis, trading education|0 Comments About the Author: Korbinian Koller Outstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent. Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.
Betting on Hawkish Fed

Betting on Hawkish Fed

Monica Kingsley Monica Kingsley 23.11.2021 15:46
S&P 500 reversed from fresh ATHs as spiking yields sent tech packing. Value didn‘t soar, but held up considerably better – still, stock bulls are getting on the defensive. Markets have interpreted the Powell nomination as a hawkish choice. I‘ve written the prior Monday:(…) the Fed is still printing a huge amount of money on a monthly basis, and it remains questionable how far in tapering plans execution they would actually get – I see the risks to the real economy coupled with persistently high inflation as rising since the 2Q 2022 (if not since Mar already, but most pronounced in 2H 2022.Inflation hasn‘t moved to the Fed‘s sights, and yesterday‘s rection in yields and precious metals is a bit too harsh. While rates are on a rising path as I‘ve written yesterday, precious metals overreacted. True, the bullish argument for the dollar stepped to the fore as yields differential between the U.S. and the rest of the world got more positive, and at the same time, various yield spreads keep compressing. That‘s a reflection of less favorable incoming economic data. Just as much as Friday‘s reaction was about corona economic impact projections, yesterday‘s one was about monetary policy anticipation.Inflation expectations though barely budged – the decline doesn‘t count as trend reversal. CPI isn‘t done rising, and the more forward looking incoming data (e.g. producer prices) would confirm there is more to come. All in all, it looks like precious metals (and to a smaller degree commodities), are giving Powell benefit of the doubt, which I view to be leading to disappointment over the coming months. Should Powell heed the markets‘ will, the real economy would weaken dramatically, forcing him to make a sharp dovish turn – and he would, faster than he flipped since getting challenged in Dec 2018.We‘re experiencing an overreaction in real assets – as stated yesterday:(…) the Fed would have to reverse course once the tapering effects start biting some more – not now, with still more than $100bn monthly addition. Cyclicals and commodities that had massively appreciated vs. year ago (oil doubled), are feeling the pinch of fresh economic activity curbs speculation in spite of the polar shift of U.S. strength in energy of 2019 and before. Begging the OPEC+ to increase production might not do the trick, and with so much inflation already in (and still to come), the key investment theme is of real assets strength.Precious metals have broken out, are no longer an underdog, and the inflation data will not decelerate for quite a few months still. And even as they would, it would come at a palpable cost to the real economy, and the resolute fresh stimulus action wouldn‘t be then far off. As I wrote in Apr 2020, it‘s about the continuous stimulus that‘s the go-to response anytime the horizon darkens, for whatever reason. Wash, rinse, repeat.Let‘s move right into the charts (all courtesy of www.stockcharts.com).S&P 500 and Nasdaq OutlookS&P 500 bulls lost the momentary upper hand, and value recovery isn‘t yet strong enough to carry it forward. A less heavy move in bonds – temporary yields stabilization – would be needed to calm down stock market nerves.Credit MarketsTreasuries held up best, and that‘s characteristic of a very risk-off sentiment. The low volume in HYG isn‘t a promise of much strength soon returning.Gold, Silver and MinersPrecious metals turned sharply lower, and haven‘t stabilized yet. Bond market pressures are keenly felt even though inflation expectations didn‘t follow with the same veracity. The next few days will be really telling.Crude OilCrude oil bulls have made a good move, and more strength needs to follow. The fact that it would be happening when the dollar is strengthening, and many countries are tapping their strategic reserves, bodes well for black gold‘s recovery.CopperCopper springboard bulding goes on, and the CRB Index isn‘t tellingly yielding – the hawkish Fed bets better be taken with a (at least short-term) pinch of salt.Bitcoin and EthereumBitcoin and Ethereum are still going sideways, and today‘s resilience is a good omen – across the board for risk assets.SummaryS&P 500 bulls need tech to come alive again, and odds are it would with a reprieve in spiking yields. While bond markets are getting it right, yesterday‘s fear in corporate bonds was a bit too much – the Fed isn‘t yet in a position to choke off the real economy through slamming on the breaks. Markets are prematurely speculating on that outcome, which would be a question of second or third quarter next year. Treasuries have though clearly topped, and stocks do top with quite a few months‘ lag – we aren‘t there yet. Enjoy the commodities ride, and confidence gradually returning to precious metals.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.
Interest rate sensitivity is back in town haunting technology stocks

Interest rate sensitivity is back in town haunting technology stocks

Peter Garnry Peter Garnry 23.11.2021 16:23
Summary:  Interest rate sensitivity came back roaring yesterday pushing down all of our growth baskets. Yesterday's move shows the potential for a correction in US technology stocks should the US 10-year yield continue to rapidly advance towards the highs from March. We also show how the Nasdaq 100 and STOXX 600 move in opposite direction during large up or down days in the US 10-year yield. Growth baskets look awfully vulnerable Yesterday’s move in the US 10-year yield of 8 basis points made it the 10th biggest move higher in US yields this year. Back in March when technology stocks were under pressure we wrote a lot about interest rate sensitivity in growth stocks as their present value are derived from expected cash flows further into the future than the typical MSCI World company. If interest rates rise faster than future growth expectations then the net effect is negative on the present value and more so for growth stocks as they have a higher duration. We saw downside beta (higher sensitivity) in all of our growth equity baskets with the gaming basket down 2.3% and the worst performers being the E-commerce and Crypto & Blockchain baskets down 4.2% and 5.1% respectively. This tells you a lot about the sensitivity and given the drawdown in technology stocks back in March, we could easily experience a 15-20% drawdown in technology stocks. The local highs from March in the US 10-year yield is the key level to watch for a breakout and a new trading environment. With all the options activity in Tesla dwarfing the combined options activity in FTSE 100 constituents, we believe Tesla will be at the center of the next risk-off move in technology. Nasdaq 100 vs STOXX 600 are yin and yang of interest rates We have previously tried to calculate the interest rate sensitivity, but this time we are pursuing a different approach. We look at the past 231 trading days this year and group the 1-day difference in the US 10-year yield into deciles. In order to measure interest rate sensitivity we calculate daily excess log returns for Nasdaq 100, S&P 500 and STOXX 600 against the MSCI World Index and compute their average daily excess return for each decile. As the barplot shows, there is significant negative excess return in Nasdaq 100 in the 1st decile (the 10% days with the highest positive difference in US 10-year yield) and significant positive excess return in STOXX 600. This makes perfect sense because Nasdaq 100 is high duration growth stocks and STOXX 600 has a clear value tilt towards financials, energy and mining which exhibit much lower duration. The pattern is completely reversed in the 10th decline (days with large negative difference in US 10-year yield). The other eight deciles do not show the same clear spread between Nasdaq 100 and STOXX 600. In other words, if interest rates suddenly move aggressively higher then growth portfolio will take a serious hit and hence why we recommend investors to improve the balance between growth and value stocks, or said differently reduce the equity duration.
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks

S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks

Paul Rejczak Paul Rejczak 22.11.2021 16:46
The S&P 500 index nearly topped its record high on Friday, but it closed lower following an intraday decline. Is this a topping pattern? For in-depth technical analysis of various stocks and a recap of today's Stock Trading Alert we encourage you to watch . The S&P 500 index lost 0.14% on Friday, Nov. 19, as it extended its short-term consolidation along the 4,700 level. The broad stock market went sideways despite record-breaking rallies in large tech stocks like AAPL, MSFT and NVDA. It still looks like a short-term topping pattern, as the S&P 500 index keeps bouncing from the Nov. 5 record high of 4,718.50. The nearest important support level remains at 4,630-4,650 and the next support level is at 4,600. On the other hand, the resistance level is at 4,700-4,720. The S&P 500 continues to trade along the 4,700 level, as we can see on the daily chart (chart by courtesy of http://stockcharts.com): Nasdaq Reached the New Record High Let’s take a look at the Nasdaq 100 chart. The technology index reached the new record high of 16,625.86 on Friday, led by megacap tech stock rallies. It accelerated above its short-term upward trend line after breaking above the resistance level of 16,400 on Thursday. There have been no confirmed negative signals so far. However, we can see some short-term overbought conditions. Apple and Microsoft at New Record Highs Let’s take a look at the two biggest stocks in the S&P 500 index, AAPL and MSFT. Apple accelerated its uptrend after breaking above the resistance level of around $152-154. It reached the new record high on Friday at $161.02. Microsoft slightly extended its recent advance, as it reached the new record high of $345.10. The two biggest megacap tech stocks reached new record highs, as we can see on their daily charts: Conclusion The S&P 500 index is expected to open 0.4% higher this morning. We will likely see some more short-term fluctuations along the record high level. For now, it looks like a short-term consolidation and a flat correction within an uptrend. Here’s the breakdown: The S&P 500 is fluctuating along the 4,700 level. For now, it looks like a short-term consolidation following the October-November rally. Still no positions are 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 Strategist Sunshine 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.
Article by Decrypt Media

More Public Debt Is Coming. Another Gold’s Rally Ahead?

Arkadiusz Sieron Arkadiusz Sieron 23.11.2021 15:13
  Democrats are not slowing down - the social spending bill follows the infrastructure package. Will gold benefit, or will it get into deep water? Will the American spending spree ever end? On Monday last week (November 15, 2021), President Biden signed a $1 trillion infrastructure package, and just a few days later, Biden’s social spending bill worth another $1.75 trillion passed the US House of Representatives. Apparently, $1 trillion was not enough! Apparently, we don’t already have too much money chasing too few goods. No, the economy needs even more money! Yes, I can almost hear the lament of American families: “we need more money, we already bought everything possible, we already own three cars and a lot of other useless crap, but we need more! Please, the almighty government, give us some bucks, let your funds revive our land”. Luckily, the gracious Uncle Sam listened to the prayers of its poor citizens. Given the above, one could think that the US economy is not already heavily indebted. Well, it’s the exact opposite. As the chart below shows, the American public debt is more than $27 trillion and 125% of GDP, but who cares except for a few boring economists? Of course, neither infrastructure nor spending bill will increase the fiscal deficits and overall indebtedness to a similar extent as the pandemic spending packages. These funds will be spread over years. Additionally, the fiscal deficit should narrow in FY 2022 as pandemic relief spending phases out (this is already happening, as the chart below shows), while the economic recovery combined with inflation tax bracket creep increases tax revenues. However, both of Biden’s bills will increase indebtedness, lowering the financial resilience of the US economy. What’s more, the overall debt is much larger than the public debt I focused on here. Other categories of debt are also rising. For instance, total household debt has jumped 6.2% in the third quarter of 2021 year-over-year, to a new record of $15.2 trillion.   Implications for Gold What does the fiscal offensive imply for the precious metal market? In the short run, not much. Fiscal hawks like me will complain, but gold is a tough metal that does not cry. Both of Biden’s pieces of legislation have been widely accepted, so their impact has already been incorporated into prices. Actually, the actual bills could be even seen as conservative – compared to Biden’s initial radical proposals. In the long run, fiscal exuberance should be supportive of gold prices. The ever-rising public debt should zombify the economy and erode the confidence in the US dollar, which could benefit the yellow metal. However, the empire collapses slowly, and there is still a long way before people cease to choose the greenback as their most beloved currency (there is simply no alternative!). So, it seems that, in the foreseeable future, gold’s path will still be dependent mainly on inflation worries and expectations of the Fed’s action. Most recently, gold prices have stabilized somewhat after the recent rally, as the chart below shows. Normal profit-taking took place, but gold found itself under pressure also because of the hawkish speech by Fed Governor Christopher Waller. He described inflation as a heavy snowfall that would stay on the ground for a while, rather than a one-inch dusting: Consider a snowfall, which we know will eventually melt. Snow is a transitory shock. If the snowfall is one inch and is expected to melt away the next day, it may be optimal to do nothing and wait for it to melt. But if the snowfall is 6 to 12 inches and expected to be on the ground for a week, you may want to act sooner and shovel the sidewalks and plow the streets. To me, the inflation data are starting to look a lot more like a big snowfall that will stay on the ground for a while, and that development is affecting my expectations of the level of monetary accommodation that is needed going forward. So, brace yourselves, a janitor is coming with a big shovel to clean the snow! Just imagine Powell with a long-eared cap, gloves, and galoshes giving a press conference! At least the central bankers would finally do something productive! Or… maybe shoveling is not coming! Although the Fed may turn a bit more hawkish if inflation stays with us for longer than expected previously, it should remain behind the curve, while the real interest rates should stay ultra-low. The December FOMC meeting will provide us with more clues, so 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
Dax 40 December hit the buying opportunity at 16080/060. Try longs with stops below 16040.

Dax 40 December hit the buying opportunity at 16080/060. Try longs with stops below 16040.

Jason Sen Jason Sen 23.11.2021 13:31
EuroStoxx 50 December just completed a head & shoulders reversal pattern for a sell signal initially targeting minor support at 4310/00. FTSE 100 December a high for the day exactly at first resistance at 7240/60. Update daily at 07:00 GMT Today's Analysis. Dax holding minor resistance at 16140/160 to retest strong support at 16090/060. Try longs with stops below 16040. A break lower however is a sell signal with 16060/090 working as resistance targeting 16000 & a buying opportunity at 15960/930. Try longs with stops below 15900. A break above 16180 keeps bulls in control for today targeting 16260/280. A break above 16290 should target 16350/390. EuroStoxx holding the head & shoulders neckline resistance at 4330/40 targets 4310/00 then 4270/60, perhaps as far as strong support at 4240/30. Resistance at 4330/40 but above here allows a recovery to 4375/80 before a retest of 4400/10. Anyone want to bet on a double top sell signal here? A break above 4410 however targets 4418/20 but eventually we can reach as far as 4450/55. FTSE we have a buying opportunity at 7170/50 with stops below 7135. A break lower targets 7100/7090, perhaps as far as 7040/30. Longs at 7170/50 target 7200 then first resistance at 7240/60 for some profit taking. If we continue higher look for 7300/10 this week. Emini S&P December new all time high exactly at the 4735/40 target in the bull trend, but severely overbought conditions finally kicked in with a sudden collapse to the 4670/68 target. This leaves a bearish engulfing candle, which is a very short term negative signal. We do have severely negative divergence on the daily chart so there is a risk of a further correction but I think there are too many retail traders betting on a crash for it to happen just yet. Nasdaq December hit the next target of 16640/660 next target then a new all time high at 16767. However prices then crashed leaving a huge bearish engulfing candle, which is a very short term negative signal. Emini Dow Jones December shorts at first resistance at 35850/950 worked perfectly with a high for the day here, followed by a retest of last week's low at 35490. Update daily at 07:00 GMT. Today's Analysis. Emini S&P first support at 4670/68 but a break below 4660 targets 4640 then the best support at 4630/20. Try longs with stops below 4610. Very minor resistance at 4700/10 but above here retargets 4720/23 & 4735/40 then 4750. Nasdaq December collapsed through first support at 16450/400 to target 16300/270 then best support for today at 16230/200. Try longs with stops below 16150. A break lower however sees 16200/230 working as resistance to target 16100 & 16030/010 before a buying opportunity at 15900/850. Try longs with stops below 15800. First resistance at 16400/450. Shorts need stops above 16500. A break higher targets 16550/600 before a retest of the all time high at 16630/767. Emini Dow Jones December strong support at 35450/350. A break lower however targets 35100/35000. Watch for a bounce from here on the first test. However a break lower meets a buying opportunity at 34800/750, with stops below 34650. First resistance at 35850/950. A break above 36000 should be a buy signal targeting 36230/250. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
Bitcoin With Further Selling Opportunities

Bitcoin: the dark side of institutional love

Alex Kuptsikevich Alex Kuptsikevich 23.11.2021 13:40
Bitcoin has suffered from the former institutional love affair with it. On Monday, a significant sell-off in the stock and bond market prevented the first cryptocurrency from returning to the upside. The recent sell-off confirmed a bearish scenario for bitcoin for now. And one should watch closely to see if this situation becomes toxic for the entire cryptocurrency market. Bitcoin fluctuated widely on Monday, and at some point, it managed to recover an initially weak start. But pressure on equities in the US trading session and the ongoing strengthening of the dollar dragged crypto down. From intraday highs, bitcoin lost 6.3% by the end of the day, at one point falling to $55.6K. The bears showed who is in control now, clearly demonstrating that bounce attempts are stumbling into aggressive selling. In such an environment, it should come as no surprise that the cryptocurrency Fear and Greed Index moved into "fear" territory, losing 17 points to 33 - its lowest level since October 1st. Perhaps the following line of defence for the bulls could be the $52.0-53.5K area, where the previous extremes and the 61.8% retracement from the September-November rally are concentrated. One can only wonder how ETHUSD continues to hold its critical $4000 level amid such aggressive pressure on BTCUSD. The first cryptocurrency appears to be under pressure from institutional sell-offs, of which there are drastically less in Ether.
Tech Sell-Off Continues

Tech Sell-Off Continues

Marc Chandler Marc Chandler 23.11.2021 22:41
November 23, 2021  $USD, EMU, Federal Reserve, Oil, OPEC+, SPR, UK, US Overview:  The markets are unsettled.  Bond yields have jumped, tech stocks are leading an equity slump, and yesterday's crude oil bounce reversed.  Gold, which peaked last week near $1877, has been dumped to around $1793.  The tech sell-off in the US carried into the Asia Pacific session, and Hong Kong led most markets lower.  The local holiday let Japanese markets off unscathed, though the Nikkei futures are off about 0.4%.  Australia and India managed to post minor gains as the MSCI Asia Pacific Index fell for the fourth time in five sessions.  Europe's Stoxx 600 has slid around 1.5% today, its fourth consecutive decline, but has clawed back nearly half the gains.  It is the longest retreat in two months.  US futures are lower, with the NASDAQ leading the move.   Near 1.64%, the US 10-year yield is at the upper end of this month's range.  Last month it reached 1.70%.  European bond yields are mostly 4-6 bp higher, and peripheral spreads have widened a little.  The dollar is sitting in the middle of the major currencies.  The dollar bloc, sterling, and the Norwegian krone, which are the risk-on, levered to growth currencies, are weaker.  The euro, yen, and Swiss franc are little changed but firmer.  The dollar briefly traded above JPY115.00 in Asia, without Tokyo,  before being pushed back. The steady euro has taken some pressure off most of the regional currencies.  The Turkish lira has been in a virtual freefall following President Erdogan's spirited defense of his efforts to drive down rates.    There was around 10 lira to the dollar in the middle of November.  Today, at its peak, there is about 12.48 lira to the dollar.   Asia Pacific Over the weekend, Japan expressed willingness to cap its strategic reserves.  Press reports indicated yesterday that India is amenable to coordinating a release of some of its oil stocks.  South Korea may also participate.  It has been under consideration for a couple of weeks, at least, in the US, and China appears willing to repeat September's release of crude from its reserves.  However,  it seems naive to have expected OPEC+ to simply standby.  January WTI posted a bearish outside down day ahead of the weekend by trading on both sides of the previous day's range and settling below the previous session's low.  Follow-through selling yesterday took it down about $1.20 from the close, but when OPEC+ announced that a coordinated release of the oil could prompt it to reconsider its own plans.  It is to meet next week to review its strategy. Through yesterday's low, January WTI had retreated by nearly 11% from the October 25 higher near $83.85.   A band of resistance is seen between $78 and $80.   OPEC+ had previously agreed to boost output by 400k barrels a day per month to restore pre-pandemic output levels.  That said, not all the members can produce their quota, leading to a shortfall.  OPEC+, the IEA, and EIA all seem to agree that supply-demand considerations shift in next year, and the market will once again be in oversupply.  Moreover, OPEC+ argues that the real dislocation is not with oil as its with gas.   The US imports about 2.9 mln barrels a day, India, about 4.2 mln, and Japan, about 3.1 mln barrels a day.  South Korea imports around 2.5 mln barrels a day.  Together it is around 12.7 mln barrels a day of imports.   If together, 100 mln barrels are released, about eight days of imports would be covered.  This is a high estimate.  India, for example, has indicated it may release 5 mln barrels.   Australia's flash November PMI was better than expected.  Manufacturing edged up to 58.5 from 58.2, while services rose to 55.0 from 51.8.  This produced a 55.0 composite reading, a gain from 52.1 in October.  Recall, the pandemic and lockdown led to weakness in the economy in the May-August period.  The composite PMI bottomed in August at 43.3.  It has risen for three months but remains well off the peak in April of 58.9.  Separately, New Zealand real retail sales were hit in Q3 by the social restrictions, but the drop was not quite as bad as feared.  Reall retail sales fell 8.1% after a 3.3% increase in Q2.  Economists (Bloomberg median) had anticipated a 10.5% pullback.  The RBNZ meets the first thing tomorrow and is widely expected to hike 25 bp, to lift the cash rate to 0.75%. There is still a slight bias toward a larger move in the swaps market.   The dollar briefly traded above JPY115.00 for the first time since March 2017.  We note that Japanese dealers were on holiday and did not participate in the move.  As risk-off sentiment took over, the dollar was sold back to JPY114.50.  Resistance in Europe has been found near JPY114.80.  Note that there is an option for about $980 mln at JPY115.50 that expires tomorrow.  The Australian dollar initially edged lower to almost $0.7210, its lowest levels since October 1 before steadying. A break of $0.7200 signals a retest of the late September low near $0.7170.  Initial resistance is seen in the $0.7230-$0.7250 area.  The PBOC is sending plenty of verbal signals that it does not want to see strong yuan gains, and today's fixing underscores that point.  The dollar's reference rate was set at CNY6.3929, wider than usual above the market expectation (Bloomberg) for CNY6.3904.  The greenback is firm inside yesterday's range.  Caution is advised here as the PBOC could escalate its disapproval.   Europe The flash EMU November PMI was better than expected.  The aggregate manufacturing PMI rose to 58.6 from 58.3.  The market anticipated a decline.  The service PMI rose to 56.6 from 54.6, also defying expectations for a sequentially weaker report.  The composite snapped a three-month slide and rose to 55.8 from 54.2.   The cyclical peak was in July at 60.2.    A flash release is made for Germany and France.    German manufacturing slowed slightly (57.6 from 57.8) and held up better than expected (Bloomberg median 56.9).  Services actually improved (53.4 from 52.4).  The composite rose to 52.8 from 52.0 to end a three-month downdraft after peaking in July at 62.4.  French numbers were even better.  The manufacturing PMI rose to 54.6 from 53.6.  The service PMI rose to 58.2 from 56.6.   The composite improved to 56.3 from 54.7 to snap a four-month fall.  Recall that yesterday the Bundesbank warned that the German economy may practically stagnate this quarter and that inflation may approach 6% this month.   The UK's flash PMI was more mixed.  The manufacturing PMI had been expected to have slowed but instead improved for the second consecutive month (58.2 from 57.8).  Services were nearly as weak as anticipated slipping to 58.6 from 59.1.  The composite eased slightly to 57.7 from 57.8, ending a two-month recovery from the June-August soft patch.  Meanwhile, Prime Minister Johnson's rambling speech yesterday hurt people's ears, and in terms of substance,  the changes to social care funding that may result in lower-income people having to sell homes to pay for support did not go over well.  It is spurring talk of a possible cabinet reshuffle.  The euro has edged to a new low for the third session today, slipping to almost $1.1225 before catching a bid that lifted it back to $1.1275.  There is an option for around 765 mln euros at $1.1220 that expires today.  The nearby cap is seen in the $1.1290-$1.1310 area.   The euro may struggle to sustain upticks ahead of tomorrow's US PCE deflator report (inflation to accelerate).    Sterling met new sellers when it poked above $1.3400. It has ground lower in the European session, and sterling fell to almost $1.3355.  Note that the low for the year and month was set on November 12, slightly above $1.3350.  We see little chart support below there until closer to $1.3165.   America We suspect many pundits exaggerated the link between the renomination of Powell for a second term and the sell-off in US debt and technology shares.  First, it was not a surprise.  Second, it assumes a substantive difference in the conduct of monetary policy between Powell and Brainard.  There isn't.  The difference was on regulatory issues and on the role of climate change.  Third, the idea that the Fed may accelerate its bond purchases next month was sparked by the high CPI reading on November 10.  Yesterday, Bostic joined fellow Fed President Bullard.  Two governors (Clarida and Waller) also seem to be moving in that direction (Waller may be faster than Clarida). The fact or the matter, nearly all of the high-frequency data for October, including employment, auto sales,  retail sales, industrial production, and inflation, came in higher than expected.  The US sees the preliminary November PMI today.  It is expected to have risen for the second consecutive month after fall June-September.   The reception to yesterday's US two- and five-year note auctions was relatively poor.  The higher yields (compared with the previous auctions) did not produce better bid-cover ratios.  Today the Treasury comes back with $55 bln seven-year notes and re-opens the two-year floater.  Many observers see the debt ceiling constraint being likely an early 2022 problem rather than this year.  Still, tomorrow's sale of the four-week bill may be the test.  Recall that at last week's auction, the 4-week bill yield doubled to 11 bp.   Europe's virus surge and social restrictions became a market factor last week.  Many think that the US is a few weeks behind Europe.  The seven-day infliction rate in the US rose 18% week-over-week.  Several states, including Colorado, Minnesota, and Michigan, are being particularly hard hit.  Nationwide 59% of Americans are reportedly fully vaccinated. However, it leaves about 47 mln adults and 12 mln teens unvaccinated.  The risk-off mood and the drop in oil prices are helping the US dollar extend its gains against the Canadian dollar.  The greenback, which started the month below CAD1.24, is now pushing close to CAD1.2750 to take out last month's high.  A move above here would target CAD1.28 and then the September high near CAD1.2900.  Still, the market is getting stretched, and the upper Bollinger Band is slightly below CAD1.2730.  The risk-off mood does not sit right with the Mexican peso either.  The dollar settled above MXN21.00 yesterday, its highest close in eight months.  The same forces have lifted it to MXN21.1250 today. However, the anticipated gain in September retail sales (0.8% Bloomberg median after a flat report in August) may not give the peso much support if the risk-off continues. The high for the year was set on March 8 near MXN21.6360.   Disclaimer
FX Update: USD kneejerks higher as Powell gets nod for second term

FX Update: USD kneejerks higher as Powell gets nod for second term

John Hardy John Hardy 23.11.2021 17:08
Summary:  US President Biden will tap Jay Powell for a second term as Fed Chair and will nominate Lael Brainard to be promoted to Vice Chair of the Fed, a move that sent the USD modestly higher and US yields sharply higher, though some of the reaction may have been on pent-up reaction to prior developments. Elsewhere, the descent in the Turkish lira is turning dire, while the kiwi is weaker ahead of an RBNZ meeting tonight. FX Trading focus: USD follows US yields higher in the wake of Powell getting nod for 2nd term Surprising a sizable minority and perhaps myself to a degree, US President Biden will tap Jay Powell for a second term as Fed Chair, while seeking to promote Lael Brainard from her current position to Vice Chair. The most prominent reason given for not going with Brainard is that her confirmation process may have proven contentious, something Biden wanted to avoid, and given extensive Democratic party support for Powell, the progressive wing aside, it was always the “easy option”. Brainard will still have to go through a confirmation process with the Senate. More interesting is the Brainard was not nominated to Vice Chair in the banking supervision and regulation role that the soon-gone Quarles occupied, a role that many envisioned for her. Biden has more nominees to consider for Quarles’ replacement and other empty spots, but continuity appears assured, though a Vice Chair Brainard will carry more weight when she dissents on non-monetary policy issues in the future (she never dissented on FOMC votes but has dissented more than 20 times on board votes linked to loosening regulation on US financial institutions). Other positions at the Fed will need filling as well, including the replacement of Quarles as banking supervisor. The market reaction to the news was fairly straightforward and “as expected” algorithmically, i.e., Brainard was supposed to be the more dovish pick, so Biden going with Powell saw the USD stronger as the market priced in about 10 basis points more in the way of Fed hikes through the end of next year. It’s tough to tell whether some of the reaction was the market simply adjusting to have this important issue “out of the way” allowing traders to price in other recent developments, like hot US data and Fed Vice Chair Clarida’s comments on possibly speeding up the pace of the Fed’s taper of asset purchases at the December FOMC meeting. The next test for whether this USD move can extend will be with tomorrow’s October PCE Inflation print and the FOMC minutes. For USDJPY, as I argue below, an extension higher  likely needs more upside from longer US yields. US President Biden will speak today on the economy and “lowering prices for the American people” which many believe will include a release of crude oil from US strategic reserves. That’s a risky move if it fails. Chart: USDJPYUSDJPY spilled over the 115.00 barrier in the wake of Powell getting the nod for a second term, with  the move now trying to decide whether it can stick. Arguably, the rise in Fed policy expectations don’t mean much if the longer end of the US yield curve remains anchored as it has lately, which continues to suggest that the market sees inflation as transitory and/or that Fed potential on rates will max out around 2.0% and crush the growth and inflation outlook. While 10-year US yields were sharply higher yesterday, they’re still bogged down in the range since the pivot high of 1.70% in October and the cycle high near 1.75% all the way back at the end of March. The logjam needs to break there and send US long yields higher for better fundamental support for a significant break above the 115.00 level in USDJPY. European politics in the spotlight – with Germany dealing with a new Covid ave and the ongoing natural gas and power crunch, it is time for the government coalition to announce itself and begin ruling. An announcement of the “stoplight” coalition could be imminent and we’ll have to watch the awkward combination closely, particularly the LDP Lindner’s attitude toward spending as the traditionally liberal party’s supply side principles are at odds with its Social Democratic and Green coalition partners inclinations, although energy emergencies are not political, but must be dealt with.  Elsewhere, Italian president Mattarella announced he will be stepping down. If, as some believe, an effort is made to replace his mostly ceremonial role with Mario Draghi, elections would have to be held. And the French election season will only heat up from here, where we watch whether Macron can keep the populists Zemmour and Le Pen at bay.  The Euro is getting very cheap – bigger fiscal, an ECB reverse repo facility, and a non-Covid constrained outlook by spring could have EURUSD in a very different place by then. Antipodean action- the Aussie has risen sharply versus the kiwi (NZD) over the last couple of sessions as the news flow for the  Aussie has improved notably, with China’s central bank possibly signaling it is ready to bring stimulus, some of the news flow in the property sector improving, and especially as iron ore prices have jumped sharply, particularly overnight, on all of the above plus anticipation that China will have to increase steel output soon. The Reserve Bank of New Zealand was one of the quickest central banks to turn hawkish over the summer and abandon QE and was only delayed slightly in hiking rates by New Zealand’s first Covid outbreak in many months over the summer. The central bank chief Adrian Orr has made it clear that the bank is on the path or many more rate hikes to come and the market has priced in a policy rate of 1.50% by the April meeting of next year versus the current 0.50%. Most believe that the central bank will only hike 25 bps tonight but a significant minority believe that the bank will hike 50 bps. As important will be the market mood (if risk sentiment is weak on further US yield rises, for example, the impact of any RBNZ move may be muted) and whether guidance is able to meet lofty expectations for further tightening. The NZ 2-year yield has traded flat at elevated levels since late October, while NZDUSD has declined, arguably on the fresh momentum in Fed expectations, so moving the needle may require that the RBNZ deliver a 50 basis point hike and even more hawkish guidance. Turkish lira move getting downright disorderly – Turkish President was out yesterday complimenting the recent Turkish Central Bank chief’s decision to cut rates another 100 basis points and declaring that the Turkish government would concentrate on policies that encourage economic growth. In rather dire language, he drew parallels between the current situation and the struggle to form the modern Turkish state in 1923 in the wake of World War I. As of this writing, USDTRY traded near 12.50 after starting last week near 10.00, a breathtaking move. Much more of this kind of price action, and the risk of hyperinflation will swing into view. Table: FX Board of G10 and CNH trend evolution and strengthThe most important trend shift was yesterday’s huge dump in precious metals – look at the momentum scores for the last 2- and 5 days. Otherwise, most trends of late are extending with the exception of the badly fading NZD. Table: FX Board Trend Scoreboard for individual pairsThe precious metals in for a rough ride on the USD- and US yield move in the wake of the Fed Chair nomination move yesterday. Elsewhere, getting some hefty trend readings in USD/SEK and UDS/NOK, which remain high beta to Euro weakness. Upcoming Economic Calendar Highlights (all times GMT) 1445 – US Nov. Flash Markit Manufacturing and Services PMI 1500 – UK BoE Governor Bailey at House of Lords 1500 – US Nov. Richmond Fed Manufacturing 1730 – ECB's Makhlouf to speak 1800 – Canada Bank of Canada’s Beaudry to speak 2130 – API’s Weekly Petroleum Stock Report 0030 – Japan Nov. Flash Manufacturing and Services PMI 0100 – New Zealand RBNZ Official Cash Rate Announcement
Intraday Market Analysis – EUR Stays Under Pressure

Intraday Market Analysis – EUR Stays Under Pressure

John Benjamin John Benjamin 24.11.2021 09:15
EURUSD struggles to rebound The euro bounced back after PMI readings in the eurozone exceeded expectations. The pair is testing July 2020’s lows around 1.1200. The RSI’s oversold situation on the daily chart may limit the downward pressure for now. We can expect a ‘buying-the-dips’ crowd as price action stabilizes. Sentiment remains fragile though and sellers may fade the next rebound. The bulls will need to lift 1.1360 before a reversal could take shape. Failing that, a bearish breakout would trigger a new round of sell-off towards 1.1100. NZDUSD lacks support The New Zealand dollar softened after the RBNZ met market expectations and raised its cash rate by 25bps. The downward pressure has increased after 0.6980 failed to contain the sell-off. The pair has given up all gains from the October rally, suggesting a lack of interest in bidding up the kiwi. An oversold RSI caused a rebound as short-term traders took profit and the bears were swift in selling into strength. The directional bias remains bearish unless 0.7010 is cleared. The September low at 0.6860 is the next support. UKOIL bounces back Brent crude recovers on speculation that OPEC+ may lower production to counter a release of strategic reserves. A break below 79.30 has shaken out the weak hands. The price has met buying interest over the daily demand zone around 77.70, which coincides with last July’s peak. A surge above 82.00 puts the bears on the defensive. Short-covering would exacerbate short-term volatility. An overbought RSI may cause a brief pullback. Then 85.50 is a key hurdle before the uptrend could resume.
Altcoins are pulling away from boring Bitcoin

Altcoins are pulling away from boring Bitcoin

Alex Kuptsikevich Alex Kuptsikevich 24.11.2021 09:45
Bitcoin has lost 2.5% on Wednesday morning, returning to $56.3K. It seems that after a lull of a day-long, sellers’ pressure on the first cryptocurrency has continued. Meanwhile, the cryptocurrency market manages to remain positive, adding 0.3% in capitalisation over the past 24 hours. A little over a month ago, Bitcoin’s share of total crypto market capitalisation trended downwards. From a peak of 49.2% on October 19th, its share has fallen to 41.7%. Optimistic market participants point to impressive demand for altcoins, which is shaping the trend. On the other hand, pessimists point out that without the market’s flagship Bitcoin, cryptocurrencies are more likely to reverse sooner rather than later, recalling the situation in late 2017 and early 2018. Behind the pressure on bitcoin is a reduction in risk traction in traditional finance, while retail investors continue to look to cryptocurrencies for insurance against devaluation and speculative/investment potential. In addition, the way retail investors participate in cryptocurrencies has changed over the past five years since the previous cycle. Cryptocurrency ICO and trading have migrated to crypto exchanges, minimising some of the fraud risks of cryptocurrency creators. However, the investment risks have not gone anywhere. Of course, Bitcoin’s steady downward trend is eating away at crypto enthusiasts’ optimism. Still, a smooth pullback like this acts as an incentive for the market to look for new names, leaving Bitcoin to conservative finance. The latter has only begun to regularly allocate a share of their portfolio to crypto this year, filling it predominantly with Bitcoin. At the same time, the leading edge of investors already views the first cryptocurrency as too conservative and boring.
Shiba Inu, Dogecoin, Cardano, and More Crypto in FBS Trader

Shiba Inu, Dogecoin, Cardano, and More Crypto in FBS Trader

Finance Press Release Finance Press Release 24.11.2021 08:39
Shiba Inu, Dogecoin, Cardano, and More Crypto in FBS Trader The international trading broker FBS keeps up with the latest trends and adds new crypto assets to its product. Now Shiba Inu, Dogecoin, Cardano, and ten more crypto assets are available for traders in the FBS Trader app. The crypto market hits new heights Crypto trading has gained popularity all over the world and seems to be even more widespread. Thus, being among the financial market leaders, FBS Trader provides its clients a Crypto account to trade crypto efficiently. By opening this account, traders open the door to unlimited trading any day and any time. Also, for convenience and ease of use, the deposits are converted into USD. A Crypto account gives traders access to more than a hundred crypto assets, from top currencies, like Bitcoin, to the rare crypto to metal pairs. And now, the list of crypto in FBS Trader has become even bigger to unleash the full crypto potential. Hyped-up crypto assets FBS dares to give the best trading opportunities to its clients. That is why the broker is constantly growing the functionality and variety of its products. This time, the most trendy and promising crypto assets were added for trading via FBS Trader: Shiba Inu Cardano Dogecoin Solana Polkadot Chainlink Polygon Uniswap Algorand Filecoin Maker Avalanche VeChain Currently, most of these crypto assets are under the traders’ community discussion. And now everyone can trade these and more instruments safely with a credible FBS Trader app. Reliable and safe choice More than 18 million traders already trust FBS. The broker’s reliability is proven by 12 years of experience and multiple awards. Also, the solid partnership with FC Barcelona and Leicester City is another evidence of FBS services’ security and high-quality products. FBS is always by the side of clients and thinks about novices in crypto trading. Specially for those confused about crypto trading, FBS Trader offers a Demo Crypto account to taste digital currencies with no risk. A Demo Crypto account replicates the real market and all crypto assets, including thirteen new ones. Thus, everyone can use a virtual $10K to practice skills and feel more confident in crypto trading. New crypto assets are already waiting for traders in the app. This time, Shiba Inu, Dogecoin, and other coins were added to the crypto list. Stay tuned for more popular instruments in FBS Trader since this is not over. More about FBS FBS is an international Forex broker that has been on the market since 2009. Millions of clients from over 150 countries choose FBS broker for its strong reputation and constantly developed products. The company provides financial services for currencies, stocks, metals, energies, indices, and crypto trading. FBS is a licensed broker regulated by CySEC, IFSC, and ASIC, winning over 60 international awards and taking care of those in need.
Market Quick Take - November 22, 2021

Market Quick Take - November 22, 2021

Saxo Bank Saxo Bank 22.11.2021 10:04
Summary:  Equity markets closed last week somewhat mixed, but the Asian session was mostly strong on indications that the Chinese PBOC is shifting its attitude on monetary policy toward easing. Elsewhere, the difficult wait for the Fed Chair nomination news continues this week ahead of the US Thanksgiving holiday on Thursday. Crude oil bounced after finding support overnight, but the risk of SPR release and Covid demand worries still linger. What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) - a new week following a new all-time high in US equities on the close on Friday, which is starting with Nasdaq 100 futures opening up higher trading around the 16,610 level in early European trading. Last week showed that investors and traders are utilizing the Covid-19 lockdown playbook selling off physical companies while buying online companies that are better equipped to navigate new lockdowns in Europe. With the US 10-year yield remaining in a range around the 1.55% there is nothing from preventing equities from extending recent gains. EURUSD and EURGBP – new Covid restrictions across Europe, which has become the center of the latest Covid wave, have crimped sentiment for the euro, as has the still very elevated power and natural gas prices. EURUSD has traded back down toward the lows of the cycle near 1.1265 overnight, with the next psychological magnet lower likely the 1.1000 area as long as the big 1.1500 break level continues to provide resistance. In EURGBP, last week saw the break of the prior major pivot low near 0.8400, with the next objective the post-Brexit vote low near 0.8275. USDJPY – threatened support on Friday on a spike lower in long US treasury, but a reversal of much of that action by this morning in late Asian trading is likewise seeing USDJPY trying to recover back into the higher range, with a focus on the recent top just short of 115.00. We likely need for long US treasury yields to sustain a move higher to support a major foray above this huge 114.5-115.00 chart area, which has topped the market action since early 2017. Meanwhile, if risk sentiment worsens further in EM and darkens the outlook for JPY carry trades there, while US treasuries remains rangebound or head lower, the JPY could squeeze higher as the speculative interest is tilted heavily short. Gold (XAUUSD) extended Friday’s drop below $1850 overnight, before bouncing ahead of key support in the $1830-35 area. The risk of a quicker withdrawal of Fed stimulus supporting real yields and the dollar has for now reduced gold's ability to build on the technical breakout. However, the price softness on Friday helped attract ETF buying with Bloomberg reporting a 10 tons increase, the biggest one-day jump since January 15. Gold’s biggest short-term threat remains the tripling of futures long held by funds during the past seven weeks to a 14-month. Most of that buying being technical driven with the risk of long liquidation now looming on a break below the mentioned support level.   Crude oil (OILUKJAN22 & OILUSDEC21) opened softer in Asia after Friday’s big drop but has so far managed to find support at $77.85, the previous top from July. The market focus has during the past few weeks shifted from the current tight supply to the risk of a coordinated reserve release, a renewed Covid-driven slowdown in demand and recent oil market reports from the EIA and IEA pointing to a balanced market in early 2022. Speculators who for the last six weeks have been net sellers of crude oil futures cut their combined WTI and Brent long to a three-month low in the week to November 16. Focus on SPR and Covid risks this week US treasuries (SHY, IEF, TLT). Government bond yields worldwide dropped as new lockdown measures were imposed in Austria on Friday. Ten-year yields tumbled to 1.55%, and they are likely to continue to trade range-bound as the debt ceiling issue will continue to compress long-term yields as volatility peaks in money markets. Investors will focus on this week’s PCE index, FOMC minutes and any news regarding a change of leadership of the Federal Reserve. If Brainard is appointed as Fed chair, the market will expect low rates for longer, thus inflation expectations will advance putting upward pressure on yields. Thus, it is unavoidable to continue to see the 5s30s continue to flatten. German Bunds (IS0L). We expect European sovereigns, in general, to continue to benefit from news related to a surge of Covid cases and lack of collateral as the year ends. Yet, the perception of inflation is changing among ECB members with Isabel Schnabel last week saying that the central bank will need to be ready to act if inflation proves more durable. Therefore, as we enter in the new year, and collateral shortages will be eased, we anticipate spreads to resume their widening. What is going on? Fed Vice Chair Clarida suggests faster Fed taper - in comments on Friday, suggesting that the December FOMC meeting could speed the pace at which the Fed will reduce its asset purchases. “I’ll be looking closely at the data that we get between now and the December meeting...It may well be appropriate at that meeting to have a discussion about increasing the pace at which we are reducing our asset purchases.” China’s central bank signals that it may ease policy. In a monetary policy report from Friday, the PBOC dropped language from prior reports, including phrase suggesting that the bank will maintain “normal monetary policy” and a promise not to “flood the economy with stimulus”. This comes in the wake of considerable disruption in the property sector as the government cracks down on an overleveraged property sector. Asian equities were mostly higher on the news, especially in Korea, although the Hang Seng index was slightly in the red as of this writing. Ericsson to acquire cloud provider Vonage in $6.2bn deal. This pushes the Swedish telecommunication company into the cloud communication industry seeking to add more growth to the overall business. Vonage has delivered 11% revenue growth in the past 12 months hitting $1.4bn with an operating margin of 10.4%. Global proceeds from IPOs hit $600bn in record year. This is the biggest amount since 2007 and almost 200% above the level in 2019 highlighting the excessive risk sentiment in equities. More confusing signals from Bank of England. Governor Bailey said in an interview for the Sunday Times that risks to the country are “two-sided” at the moment as growth slows and inflation rises, and that the cause of inflation problems is supply side constraints and that “monetary policy isn’t going to solve those directly.” Similarly, BoE Chief Economist Huw Pill said on Friday that the Bank of England said that the weight of evidence was shifting in favour of rate hikes but that he has not yet made a decision, encouraging observers to focus on the longer term rather than meeting-to-meeting decision. US shared intelligence with allies suggesting potential for Russia to invade Ukraine - according to Bloomberg sources. The intelligence noted up to 100,000 soldiers could be deployed in such a scenario, and that some half of that number are already in position.  Russian president Vladimir Putin denied Russia intends to invade, but seemed to pat himself on the back for “having gotten the attention of the US and is allies, which he accused of failing to take Russia’s ‘red lines’ over Ukraine seriously”, as the article puts it. What are we watching next? Who will US President Biden nominate to head the Fed next February? Powell is still seen as more likely to get the nod that Brainard by roughly two to one, and this Fed Chair nomination issue is hanging over the markets, as the current Fed chair term ends in early February and from comments made last week by President Biden, an announcement could come any day. One uncertainty that would come with a Brainard nomination is the potential difficulty of having her nomination approved by the Senate. The nomination news could generate significant short-term volatility on the choice of the nominally more dovish Lael Brainard over current Fed Chair Powell, though we see little difference in the medium-longer term implications for monetary policy, and the Fed is likely to get a prominent new regulatory role either way (under Brainard or someone else if she is nominated to replace Powell). Will Germany announce a Covid lockdown? - Friday saw some volatility on Austria’s announcement of a full Covid lockdown, with Germany’s health minister saying that a similar move in Germany could not be ruled out. Later that day, that was contradicted by comments from another minister. Meanwhile, resistance against Covid restrictions has turned violent in Netherlands. Earnings Watch – the number of important earnings is falling rapidly, but this week Tuesday is the most important day with key earnings from Xiaomi, XPeng and Kuaishou, both important Chinese technology companies. Also on Tuesday, US companies such as Medtronic, Autodesk and Dell Technologies are worth watching. Monday: Sino Pharmaceutical, Prosus, Zoom Video, Agilent Technologies Tuesday: Xiaomi, Kuaishou Technology, Compass Group, Medtronic, Analog Devices, Autodesk, VMWare, Dell Technologies, XPeng, HP, Best Buy, Dollar Tree Wednesday: Deere, Thursday: Adevinta Friday: Meituan, Pinduoduo Economic calendar highlights for today (times GMT) 0900 - Switzerland SNB weekly sight deposit data1330 – US Chicago Fed Oct. National Activity Index1500 – US Oct. Existing Home Sales1730 – ECB's Guindos to speak2145 – New Zealand Q3 Retail Sales2200 – Australia Nov. Flash Services & Manufacturing PMI0105 – Australia RBA’s Kohler to speak Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app: Apple Spotify Soundcloud Sticher
Dax 40 December longs at 16080/060 stopped below 16040 for a sell signal targeting 1a buying opportunity at 15960/930.

Dax 40 December longs at 16080/060 stopped below 16040 for a sell signal targeting 1a buying opportunity at 15960/930.

Jason Sen Jason Sen 24.11.2021 10:52
Dax 40 December longs at 16080/060 stopped below 16040 for a sell signal targeting 1a buying opportunity at 15960/930. However unfortunately we unexpectedly ran as far as 15860 before the bounce. EuroStoxx 50 December we wrote: just completed a head & shoulders reversal pattern for a sell signal initially targeting 4310/00 then 4270/60 (a low for the day here), perhaps as far as strong support at 4240/30. FTSE 100 December shorts at first resistance at 7240/60 worked a few times for 50 tick scalping opportunities before we eventually broke higher, so now this is today's support. Update daily at 07:00 GMT Today's Analysis. Dax my buying opportunity at 15960/930 was clearly too high - apologies - I will revise to 15870/840. Try longs with stops below 15800. Very strong support at 15750/700. Longs need stops below 15650. A break lower meets the best support for this week at 15575/525. Strong resistance at 16050/100. Shorts need stops above 16150. A break higher keeps bulls in control for today targeting 16260/280. A break above 16290 should target 16350/390. EuroStoxx shorts work on the slide to 4270/60. Holding first resistance at 4300/10 risks a retest of 4270/60 with a fall as far as strong support at 4240/30 possible before the end of the week. Resistance at 4300/10. Second resistance at 4330/40 but above here allows a recovery to 4375/80 before a retest of 4400/10. Anyone want to bet on a double top sell signal here? A break above 4410 however targets 4418/20 but eventually we can reach as far as 4450/55. FTSE holding what is now first support at 7260/40 targets 7300/10, perhaps as far as 7335/40 before a retest of 7380/90. Minor support at 7260/40 then we have a buying opportunity at 7170/50 with stops below 7135. A break lower targets 7100/7090, perhaps as far as 7040/30. Emini S&P December longs at first support at 4670/68 unexpectedly stopped below 4660 before a bounce from 4650. Bulls remain in control with no sell signal. (Although the bearish engulfing candle is likely to signal sideways trend so ease severely overbought conditions). Nasdaq December lower after a huge bearish engulfing candle, which is a very short term negative signal. Shorts at first resistance at 16400/450 worked perfectly, with a high for the day here. However we were buying at 16230/200, with stops below 16150...a low for the day at 16119 so unfortunately my stop was too tight with a recovery now as far as 16350. Emini Dow Jones December shorts at first resistance at 35850/950 worked perfectly with a high for the day here, followed by buying in to longs at strong support at 35450/350 & a low for the day here. Perfect calls!! Update daily at 07:00 GMT. Today's Analysis. Emini S&P I am going to stick with first support at 4670/68 but a break below 4660 targets 4640 then the better support at 4630/20. Try longs with stops below 4615. The best support at 4600/4395 this week - stop below 4385. Very minor resistance at 4700/10 but above here retargets 4720/23 & 4735/40 then 4750. Nasdaq December best support for today at 16230/180. Try longs with stops below 16100! Hopefully that gives us enough room. A break lower however sees 16180/230 working as resistance to target 16030/010 before a buying opportunity at 15900/850. Try longs with stops below 15750. First resistance again at 16400/450. Shorts need stops above 16500. A break higher targets 16550/600 before a retest of the all time high at 16630/767. Emini Dow Jones December longs at at 35450/350 worked perfectly on the bounce to 35790, just below first resistance at 35850/950. A break above 36000 should be a buy signal targeting 36230/250. Strong support again at 35450/350. A break lower however targets 35100/35000. Watch for a bounce from here on the first test. However a break lower meets a buying opportunity at 34800/750, with stops below 34650. To subscribe to this report please visit daytradeideas.co.uk or email jason@daytradeideas.co.uk No representation or warranty is made as to the accuracy or completeness of this information and opinions expressed may be subject to change without notice. Estimates and projections set forth herein are based on assumptions that may not be correct or otherwise realised. All reports and information are designed for information purposes only and neither the information contained herein nor any opinion expressed is deemed to constitute an offer or invitation to make an offer, to buy or sell any security or any option, futures or other related derivatives.
COT Speculator Extremes: Brent Oil, Coffee, Mexican Peso & Palladium lead Bullish & Bearish Positions

COT Speculator Extremes: Brent Oil, Coffee, Mexican Peso & Palladium lead Bullish & Bearish Positions

Invest Macro Invest Macro 24.11.2021 08:11
November 23, 2021 By InvestMacro | COT | Data Tables | COT Leaders | Downloads | COT Newsletter The latest update for the weekly Commitment of Traders (COT) report was released by the Commodity Futures Trading Commission (CFTC) on Friday for data ending on November 16th 2021. This weekly Extreme Positions report highlights the Top 5 Most Bullish and Top 5 Most Bearish Positions for the speculator category. Extreme positioning in these markets can foreshadow strong moves in the underlying market. To signify an extreme position, we use the Strength Index (also known as the COT Index) of each instrument, a common method of measuring COT data. The Strength Index is simply a comparison of current trader positions against the range of positions over the previous 3 years. We use over 80 percent as extremely bullish and under 20 percent as extremely bearish. (Compare Strength Index scores across all markets in the data table or cot leaders table) Speculators or Non-Commercials Notes: Speculators, classified as non-commercial traders by the CFTC, are made up of large commodity funds, hedge funds and other significant for-profit participants. The Specs are generally regarded as trend-followers in their behavior towards price action – net speculator bets and prices tend to go in the same directions. These traders often look to buy when prices are rising and sell when prices are falling. To illustrate this point, many times speculator contracts can be found at their most extremes (bullish or bearish) when prices are also close to their highest or lowest levels. These extreme levels can be dangerous for the large speculators as the trade is most crowded, there is less trading ammunition still sitting on the sidelines to push the trend further and prices have moved a significant distance. When the trend becomes exhausted, some speculators take profits while others look to also exit positions when prices fail to continue in the same direction. This process usually plays out over many months to years and can ultimately create a reverse effect where prices start to fall and speculators start a process of selling when prices are falling.   Here Are This Week’s Most Bullish Speculator Positions: Brent Oil The Brent Oil speculator trader’s futures position comes in as the most bullish extreme standing this week. The Brent speculator level is currently at a 98 percent score of its 3-year range. The speculator position totaled -12,900 net contracts this week which was a change by -1,049 contracts from last week. The speculator long position was a total of 45,201 contracts compared to the total spec short position of 58,101 contracts. Free Reports: Top 5 Companies Added to Our Stock Watch List this Quarter - Here are the Stock Symbols that stood out so far in the fourth quarter of 2021. Get our Weekly Commitment of Traders Reports - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.   Coffee Futures The Coffee Futures speculator trader’s futures position comes next in the extreme standings this week. The Coffee speculator level is now at a 97 percent score of its 3-year range. The speculator position was 66,081 net contracts this week, a change by 5,261 contracts from last week. The speculator long position was a total of 79,550 contracts versus the total speculator short position of 13,469 contracts. New Zealand Dollar The New Zealand Dollar speculator trader’s futures position comes in third this week in the extreme standings. The NZD speculator level resides at a 95 percent score of its 3-year range. The speculator position was 13,965 net contracts this week which marked a change by 1,083 contracts from last week. The speculator long position was a total of 26,388 contracts versus the total speculator short position of 12,423 contracts. 2-Year Bond The 2-Year Bond speculator trader’s futures position comes up number four in the extreme standings this week. The 2-Year speculator level is at a 91 percent score of its 3-year range. The speculator position was -5,445 net contracts this week and changed by 11,292 contracts from last week. The speculator long position was a total of 345,245 contracts against the total spec short position of 350,690 contracts. US Treasury Bond The US Treasury Bond speculator trader’s futures position rounds out the top five in this week’s bullish extreme standings. The Long T-Bond speculator level sits at a 88 percent score of its 3-year range. The speculator position was -16,368 net contracts this week which was a move of 11,704 contracts from last week. The speculator long position was a total of 144,973 contracts in comparison to the total speculator short position of 161,341 contracts. This Week’s Most Bearish Speculator Positions: Mexican Peso The Mexican Peso speculator trader’s futures position comes in as the most bearish extreme standing this week. The MXN speculator level is at a 2 percent score of its 3-year range. The speculator position was -47,655 net contracts this week, a weekly change of 752 contracts from last week. The speculator long position was a total of 69,984 contracts versus the total spec short position of 117,639 contracts. Palladium The Palladium speculator trader’s futures position comes in next for the most bearish extreme standing on the week. The Palladium speculator level is at a 7 percent score of its 3-year range. The speculator position was -2,038 net contracts this week which was a change by 916 contracts from last week. The speculator long position was a total of 3,108 contracts compared to the total speculator short position of 5,146 contracts. Japanese Yen The Japanese Yen speculator trader’s futures position comes in as third most bearish extreme standing of the week. The JPY speculator level resides at a 10 percent score of its 3-year range. The speculator position was -93,126 net contracts this week saw movement by 12,225 contracts from last week. The speculator long position was a total of 24,635 contracts against the total spec short position of 117,761 contracts. Nikkei 225 Yen The Nikkei 225 Yen (Japanese stock market) speculator trader’s futures position comes in as this week’s fourth most bearish extreme standing. The Nikkei 225 Yen speculator level is at a 11 percent score of its 3-year range. The speculator position was -4,195 net contracts this week which was a change by -3,892 contracts on the week. The speculator long position was a total of 9,075 contracts versus the total speculator short position of 13,270 contracts. 5-Year Bond Finally, the 5-Year Bond speculator trader’s futures position comes in as the fifth most bearish extreme standing for this week. The 5-Year speculator level is at a 20 percent score of its 3-year range. The speculator position was -344,595 net contracts this week and changed by 62,890 contracts from last week. The speculator long position was a total of 300,750 contracts compared to the total spec short position of 645,345 contracts. 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.
FX Update: USD remains firm, RBNZ taps brakes on expectations

FX Update: USD remains firm, RBNZ taps brakes on expectations

John Hardy John Hardy 24.11.2021 13:44
Summary:  The US dollar remains firm after the news of Fed Chair Powell getting the nod for a second term on Monday, but a more aggressive extension of its recent strength is avoided as US yield rises were tempered yesterday. Elsewhere, a less hawkish than expected RBNZ saw the kiwi sharply weaker as the market removed a chunky bit of forward rate hike expectation on the latest guidance. FX Trading focus: USD follows US yields higher in the wake of Powell getting nod for 2nd term The US dollar strengthening in the wake of President Biden’s announcement that he would tap Jay Powell for a second term as Fed Chair extended modestly yesterday and into this morning, somewhat tempered by a strong US 7-year treasury auction taking the steam out rises in yields yesterday – with the 7-year benchmark actually notching new highs for the cycle before retreating in the wake of the auction. The more widely tracked 10-year US treasury yield benchmark is still rangebound below the October pivot high of 1.7% and the post-pandemic outbreak high of 1.75%  from the end of March. This has kept USDJPY from extending notably above the sticky 115.00 area of the moment. Elsewhere, the euro remains relatively weak despite ECB Vice President de Guindos out speaking and hinting some concern on inflation rises: “the ECB is continuously pointingout that the inflation rebound is of a transitory nature....However, we have also seen how in recent months these supply factors are becoming more structural, more permanent.” But just this morning we also have the ECB’s Holzmann out saying that inflation is likely to slow from next year. Later today we will get the expected German government coalition deal (SPD’s Scholz as Chancellor with Green’s Baerbock reportedly set for the foreign minister post and importantly, the liberal LDP’s Lindner set to lead the finance ministry), with a press conference set for 3 p.m. EURJPY and EURUSD are heavy this morning and note that  the 128.00 level in EURJPY is a well-defined range low, while EURUSD doesn’t have notable  support until well below 1.1200 and arguably not until psychological levels like 1.10. With covid spiking and a galloping energy crisis, I don’t envy the new German leadership. Overnight, the Reserve Bank of New Zealand waxed a bit more cautious than was expected by the market, and not only by raising the rates 25 basis points rather than the 50 basis points that a minority were expecting to see. In the central bank’s new statement, the bank strikes a more cautious tone: yes, clearly further rate hikes are set for coming meetings, but the bank is clearly in a wait and see mode, given the tightening of financial conditions already in the bag and that which the market has already priced in: “the Committee expressed uncertainty about the resilience of consumer spending and business investment....(and) also noted that increases in interest rates to householdsandbusinesses had already tightened monetary conditions. High levels of household debt, and a large share of fixed-rate mortgages re-pricing in coming months, could increase the sensitivity of consumer spending to these interest rate increases.” Later today, we have a stack of US data releases crammed into today because of the Thanksgiving holiday tomorrow (and for most, Friday as well). The most important of these is the October PCE Infation data print. Not expecting much from the FOMC minutes later as all eyes are on whether we are set for an acceleration of the QE taper at the December FOMC meeting, with some arguing that Powell and company have more room to move and administer a bit more hawkish message, if they so desire, as the nomination news is out of the way and this reduces hyper-sensitivity to bringing any message that could risk cratering market sentiment. Chart: AUDNZDThe 2-year yield spread between Australia and New Zealand has risen sharply in recent days and especially overnight, where the more cautious than expected tones from the RBNZ inspired a 14 basis point drop in 2-year NZ yields. The price action in AUDNZD was sympathetic with the rally back toward local resistance near 1.0450, though the rally needs to find legs for a move up to 1.0600 at least to indicate we may have put a structural low in with a double bottom here. A brighter relative outlook for  Australia could be in the cards if China is set to stimulate and raise steel output, the anticipation of which has already sharply lifted iron ore prices this week, a key indicator for the Aussie. No notable expectations for the Riksbank tomorrow – as the central bank is expected to wind down its balance sheet expansion next year, while the policy forecast is thought to be in play (perhaps a late 2024 lift-off built into expectations, though the market is ahead of that as 2-year Swedish swap rates have risen close to 30 basis in recent weeks. This is the area where the Riksbank can surprise in either direction relative to expectations). The EURSEK rally has now reversed the entirety of the prior sell-off leg and double underlines the very weak sentiment on Europe, which remains “non-existential” in nature, i.e., so far the market is keeping this about policy divergence and dark clouds over the economic outlook, not about the longer term viability of the EMU, etc…, which in the past 2010-12 crisis inspired SEK upside as a safe haven. Table: FX Board of G10 and CNH trend evolution and strengthA bit of a relative pick-up in petro-currencies in the wake of yesterday’s oil rally, as the market bought the fact of US President Biden announcing a release of barrels from strategic reserves. Elsewhere, the NZD is losing relative altitude and the USD and especially CNH reign supreme. Table: FX Board Trend Scoreboard for individual pairs.Here, note AUDNZD flipping back to positive - a move that would be “confirmed” by a close solidly above 1.0450. Also note NOKSEK trying to flip positive on the latest oil rally, although beware the Riksbank meeting up tomorrow there. .Upcoming Economic Calendar Highlights (all times GMT) 1330 – US Weekly Initial and Continuing Jobless Claims 1330 – US Oct. Advance Goods Trade Balance 1330 – US Q3 GDP Revision 1330 – US Oct. Durable Goods Orders 1430 – UK BoE’s Tenreyro to speak 1500 – US Oct. PCE Inflation 1500 – US Final University of Michigan Sentiment Survey 1500 – US Oct. New Home Sales 1900 – US FOMC Meeting Minutes
Waking Up the Giants

Waking Up the Giants

Monica Kingsley Monica Kingsley 24.11.2021 16:03
S&P 500 recovered from session lows, and is likely to keep chopping around in a tight range today. Tech found solid footing in spite of sharply rising yields, which value (finally) embraced with open arms. The riskier end of credit markets doesn‘t yet reflect the stabilization in stocks, which is a first swallow. Make no mistake though, the fresh Fed hawkish talking games are a formidable headwind, and animal spirits aren‘t there no matter how well financials or energy perform. These are though clearly positive signs, which I would like to see confirmed by quite an upswing in smallcaps. All in all, this is still the time to be cautiously optimistic, and not yet heading for the bunker – that time would probably come after the winter Olympics (isn‘t it nice how that rhymes with the post 2008 summer ones‘ price action too?). Market reaction to today‘s preliminary GDP data will likely be a non-event, and we‘ll still probably make fresh ATHs before stocks enter more turbulent times. In spite of the cheap Fed talk still packing quite some punch, let‘s keep focused on the big picture and my doubts as to the Fed‘s ability to carry out the taper, let alone (proactive? No, very much behind the curve) rate raising plans – as said the prior Monday or yesterday: (…) the Fed is still printing a huge amount of money on a monthly basis, and it remains questionable how far in tapering plans execution they would actually get – I see the risks to the real economy coupled with persistently high inflation as rising since the 2Q 2022 (if not since Mar already, but most pronounced in 2H 2022. (…) True, the bullish argument for the dollar stepped to the fore as yields differential between the U.S. and the rest of the world got more positive, and at the same time, various yield spreads keep compressing. That‘s a reflection of less favorable incoming economic data. Just as much as Friday‘s reaction was about corona economic impact projections, yesterday‘s one was about monetary policy anticipation. Inflation expectations though barely budged – the decline doesn‘t count as trend reversal. CPI isn‘t done rising, and the more forward looking incoming data (e.g. producer prices) would confirm there is more to come. All in all, it looks like precious metals (and to a smaller degree commodities), are giving Powell benefit of the doubt, which I view to be leading to disappointment over the coming months. Should Powell heed the markets‘ will, the real economy would weaken dramatically, forcing him to make a sharp dovish turn – and he would, faster than he flipped since getting challenged in Dec 2018. Inflation expectation indeed held up during the day, marking modest, lingering doubts about Fed‘s ability to execute. Its credibility isn‘t lost, but would be put to a fresh test over the nearest weeks and months. The real economy can still take it, and not roll over – we are in the very early tapering stage so far still. Commodities are pointing the way ahead, and it‘s time for precious metals to shake off the inordinately high levels of fear, which mark capitulation more than anything else. Just when I was writing that it‘s as if the PMs bulls didn‘t trust the latest rally... Let‘s move right into the charts (all courtesy of www.stockcharts.com). S&P 500 and Nasdaq Outlook S&P 500 bulls stepped in, the volume is semicredible. I like the lower knot, and would look for increasing market breadth to confirm the short-term reversal. It‘s my view we haven‘t made a major top on Monday. Credit Markets It‘s too early to call a budding reversal in credit markets – HYG needs to pull its weight better. Gold, Silver and Miners Precious metals haven‘t yet regained footing, but that moment is quickly approaching – in spite of the above bleak chart. Compare to the Jun period – Fed‘s talk was more powerful then. Crude Oil Crude oil bulls have made a good move, and more strength did indeed follow. The bottom is in, and many countries tapping their strategic reserves, proved an infallible signal. I look for consolidation followed by further strength next. Copper Copper springboard is getting almost complete, and I think the drying up volume would be resolved with an upswing. The daily indicators are positioned as favorably as the CRB Index is. Bitcoin and Ethereum Bitcoin and Ethereum are still correcting, and the upcoming Bitcoin move would decide the direction over the next few weeks. The takeaway from cryptos hesitation is that real assets can‘t expect overly smooth sailing yet. Summary S&P 500 bulls would ideally look to value outperforming tech on the upside, confirmed by HYG at least stopping plunging. A brief yields reprieve would come once the Fed steps away from the spotlight, which is another part of the bullish sentiment returning precondition set. Overall, the very modest S&P 500 moves keep favoring the bulls within the larger topping process. Keep in mind that the Fed isn‘t yet in a position to choke off the real economy through slamming on the breaks, it‘s just the forward guidance mind games for now. We are waiting for the bit more seriously than last time meant, but still a bluff, getting questioned again, as inflation expectations haven‘t broken down, and are facilitating the coming PMs and commodities runs. 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.
Turkish Lira Is at Record Lows. How to Trade It?

Turkish Lira Is at Record Lows. How to Trade It?

Kseniya Medik Kseniya Medik 24.11.2021 14:20
USD/TRY belongs to the exotic group of Forex currency pairs, that’s why traders don’t trade it regularly. However, these days this pair is in the focus of all the trading community! What happened? The Turkish lira dropped to the all-time low of just over 13.00 as Turkish President Recep Tayyip Erdogan continued to defend the huge interest rate cuts by the central bank: three times since September. That drove up inflation to 20%. The Turkish lira has lost almost half of its value this year, making it the world's worst-performing currency. What’s next? Credit Suisse forecasts USD/TRY to reach 14.00 soon. The Central Bank of the Republic of Turkey (CBRT) needs to make a sizable rate increase to reverse the downtrend in USD/TRY. However, it is unlikely to happen soon. What else? Turkey is not the only country that will face an economic crisis. Indeed, the prospect for higher interest rates in the US is a negative factor for all these countries that have debt in US dollars. The Federal Reserve is expected to start slowing down the pace of its asset purchases already this month. Besides, the central bank plans to raise rates as soon as June 2022. It’s a bullish factor for the USD. Tech analysis USD/TRY has reversed down after rallying for so long and dropped. However, it has stopped ahead of the significant support level of 12.00. The pair won’t cross it on the first try. The most likely scenario is that it bounces off and turns to the upside. The move above 12.50 will clear the way to the resistance zone of 13.00 and 13.15. Support levels are 12.00 and 11.50. Download the FBS Trader app to trade anytime anywhere! For a personal computer or laptop, use MetaTrader 5!
Why Consider Dividend Growth Investing?

Why Consider Dividend Growth Investing?

Dividend Power Dividend Power 22.11.2021 08:31
Why Consider Dividend Growth Investing? Dividend growth investing is increasingly popular in the US and worldwide. The concept is simple and easy to understand. An investor buys a basket of stocks that annually increases the dividend. This strategy is a long-term buy-and-hold strategy. In contrast, it is the opposite of a trading strategy where an investor rapidly buys and sells stocks. Some investors think of dividend stocks as something that only retirees buy for income. However, some of the largest tech companies pay dividends, including Apple (APPL) and Microsoft (MSFT). Hence, investors can buy growth stocks that also pay a growing dividend. Why Dividends? Do dividends matter to investors? The short answer is yes for a few reasons. First, over time, stocks that pay dividends tend to outperform ones that don't pay dividends with lower volatility as measured by beta. The difference in total return is even more significant for comparing stocks that pay growing dividends and stocks that don’t pay dividends. Furthermore, research has shown that dividend and dividend growth stocks significantly outperform stocks that cut or eliminate dividends. The reason for this is that companies that cut or eliminate dividends are often performing poorly. In some cases, this poor performance is due to changing economic conditions. For instance, energy companies performed poorly in 2020 due to the COVID-19 pandemic. Lower revenue and earnings caused many energy companies to stop paying a dividend. However, in many cases, it is because the company is facing increasing competition or changing technology. For example, Kodak's core technology was film, and digital cameras and smartphones made film obsolete. Another reason why dividends matter is dividends can be used to determine valuation. An estimate of a fair value can be calculated using the dividend per share and the expected constant growth rate. Dividends also indicate if the company is doing poorly or well since cash must be used to pay the dividend. Research has also shown that dividend stocks perform better than non-dividend-paying stocks in down markets. Types of Companies Not all companies pay a dividend or a growing dividend. In the US, there are over 6,000 stocks listed on stock market exchanges. Of these, more than 3,500 pay a dividend, and only about several hundred pay a growing dividend for 5+ years. The fact points to the difficulty a company has for growing the dividend over a more extended period. There are lists of companies that pay a dividend for extended periods. One group of stocks that are well known as dividend growth stocks are the Dividend Aristocrats. The stocks on this list have raised the dividend for 25+ years. In addition, the stocks must meet other criteria, including being a member of the S&P 500 Index and having a market capitalization of $3 billion or more. Currently, there are 65 stocks on the Dividend Aristocrats list. Investors can buy the individual stocks or buy an exchange-traded fund (ETF) that owns the entire list. A Top Dividend King Today An even more exclusive club of dividend growth stocks is the Dividend Kings 2021 list. These are stocks that have paid a growing dividend for 50+ years. There are only 32 stocks on this list. It is challenging for a company to raise the dividend for 50 or more years. Typically, a company must have a substantial competitive advantage to overcome economic cycles and competition. One top Dividend King today is Johnson & Johnson (JNJ). The company is a global healthcare company with three primary business segments: Consumer Health, Pharmaceutical, and Medical Devices. Most investors know the company through its consumer health business. Major brands include Band-Aid, Neosporin, Tylenol, Zyrtec, Sudafed, Motrin, Benadryl, Pepcid, Listerine, Aveeno, Neutrogena, Stayfree, Carefree, o.b., and Clean & Clear. However, Johnson & Johnson's other two segments are much larger. For example, some of the drugs that Johnson & Johnson sells are blockbusters, with over $1 billion annually in sales. Johnson & Johnson’s stock price is relatively flat for the year, with a gain of ~3.5% year-to-date. However, results impacted by COVID-19 have pressured the stock price. In addition, Johnson & Johnson is faced with lawsuit risks from opioids and talcum powder that are also pressuring the stock price. The current quarterly dividend rate is $1.06 per share for an annual rate of $4.24 per share. The forward dividend yield is about 2.6%. The company’s dividend is relatively safe. The forward payout ratio is approximately 43%, a good value. Furthermore, Johnson & Johnson is one of two triple-AAA-rated companies from credit agencies. For this reason, Johnson & Johnson is often considered one of the best dividend growth stocks. Johnson & Johnson recently announced that it would split into two companies. The Consumer Health business will be divested, leaving the Pharmaceutical and Medical Device business. Johnson & Johnson will continue to grow organically through R&D and approvals for new medications and indications. The company will also probably buy smaller companies adding to its growing portfolio of products. Market Capitalization: $428.82 billion Stock Price: $162.89 Dividend Yield: 2.6% Payout Ratio: 43.3% Summary Dividend growth stocks should be considered by all investors, not just those in retirement. The reason is that they can provide excellent long-term returns with lower volatility. There are hundreds of stocks to pick from using this investment strategy, including many well-known ones. 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, 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 3% out of over 8,116 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. 
Danish equities are feeling the heat from interest rates

Danish equities are feeling the heat from interest rates

Peter Garnry Peter Garnry 24.11.2021 14:14
Equities 2021-11-24 13:00 6 minutes to read Summary:  The last two trading days US technology stocks have been impacted by rising interest rates and rising market expectations of Fed rate hikes next year. US technology stocks have interest rate sensitivity due to their high equity valuation, but several other key equity markets such as Netherlands, New Zealand, Singapore, Switzerland, and Denmark are also having high equity valuation and thus high duration. These equity markets would likely underperform next year if the interest rates move considerably higher. In yesterday’s equity note, we showed how Nasdaq 100 and STOXX 600 are the yin and yang of interest rate sensitivity based on equity market reaction this year with Nasdaq 100 underperforming significantly when the US 10-year yield has a large increase. But outside these two major equity indices, investors felt what higher interest rates can do to sentiment. Danish equities were down 3% in its worst day since March 2020 during the panic days of the pandemic and Dutch equities were down 3.1%. What do these two markets have in common? They both have equity valuations that are well above many other markets, which simplistically can be translated into higher duration which means that these equity markets are more sensitive to big changes in interest rates. Why is that? Because high equity valuation implies that a larger part of the present value comes from the terminal value on cash flows (meaning way into the future) and this value is more sensitive to the discount rate. Dutch equities are the most expensive of 26 equity markets in the developed and emerging markets with a 12-month forward EV/EBITDA of 23.3x with Denmark and Switzerland less frothy at 14.3x and 14.7x respectively. If we exclude Australia, India, New Zealand and Singapore from yesterday’s market reaction because of the time delay to the US session then we do observe that equity markets with high equity valuations were hit harder yesterday confirming that we did observe a repricing related to a larger move in interest rates. It is all related to the value vs growth trade which is essentially STOXX 600 vs Nasdaq 100, but which can also be expressed between individual equity indices such as Norway vs Denmark. The main point of yesterday’s equity note and today’s observations is that we have a group of equity markets such as Netherlands, New Zealand, Singapore, USA, Switzerland, and Denmark that are in the high equity valuation group. These markets have higher interest rate sensitivity and would likely underperform in a rising interest rate environment and exacerbated if flows also favour value over growth. In our view the equity market is telling investors that tail risks are rising for high duration equities and in order to mitigate this investors should begin balancing their portfolios better between high valued growth stocks and value stocks such as energy, financials, and mining companies. Appendix: 5-year charts of OMXC25 (Danish equities) and AEX (Dutch equities)
Turkey gets a Reprieve before US Thanksgiving, but Capital Strike may not be Over

Turkey gets a Reprieve before US Thanksgiving, but Capital Strike may not be Over

Marc Chandler Marc Chandler 24.11.2021 14:28
November 24, 2021  $USD, Currency Movement, Germany, Japan, Mexico, RBNZ, Turkey Overview:  The dramatic collapse of the Turkish lira was like an accident one could not help look at, but it was not an accident, but the result of a disregard for the exchange rate and compromised institutions.  The lira was off around 15% at its worst yesterday, before settling 11.2% lower.  After falling for 11 sessions, it has steadied today (~2.7%)  but the capital strike may not be over.  On the other hand, the Reserve Bank of New Zealand delivered the 25 bp rate hike and seemed to give hawkish guidance, and yet the New Zealand dollar was sold and the worst-performing of the major currencies, off 0.65% through the European morning.  The tech losses on Wall Street yesterday weighed on Asia Pacific equities today, where the large markets fell but in China.  Europe's Stoxx 600 is less tech sensitive and is trying to snap a four-day air pocket, but early gains have been reversed. The US futures point to around a 0.5% lower opening.  The greenback has a firmer bias ahead of the full economic calendar ahead of tomorrow's holiday.  The yen is the notable exception.  The greenback rose to a new multi-year high near JPY115.25 but has come back offered and is straddling the JPY115 level in late morning turnover in Europe.  Emerging market currencies are mixed, though the JP Morgan Emerging Market Currency Index is firmer after six consecutive down sessions.  Gold is steadying after a four-day drop that took it from around $1870 to about $1782. Oil extended yesterday's recovery after the concerted agreement to release strategic reserves from six countries but is struggling to sustain the upside momentum.  The market was unimpressed with the new supply and had it (and more?) discounted.  European (Dutch) gas rose 8% yesterday and remains firm today.  Iron ore prices are higher for the fourth session, during which time it has risen by around 20%.  Copper is also firmer for the second session.  It is up about 4.5% from the middle of last week's low.   Asia Pacific The Reserve Bank of New Zealand hiked its cash rate 25 bp to 0.75%.  It was widely expected, and many had leaned to a 50 bp move.  The forward guidance saw the cash rate at 2.0% at the end of next year.  The swaps market had this nearly priced in as well.  This might help explain the profit-taking on the New Zealand dollar.  The 2-year yield fell 14 bp, and the 10-year yield eased by 5.5 bp.  New Zealand stocks defied the regional pressure and rose by about 0.6%.   Japan's economy is recovering. The economy contracted by 0.8% in Q3, but after a slow start, the vaccination program has been successful.  It has allowed a re-opening of the economy.  This is evident in the flash PMI report.  The manufacturing PMI rose to 54.2 from 53.2, and the services PMI improved to 52.1 from 50.7.  The composite new stands at 52.5 (from 50.7) and represents a new cyclical high.  Recall that it bottomed in August at 45.5.  The fiscal support being offered by the supplemental budget is pro-cyclical; it will accelerate the recovery.   The break of JPY115.00 has seen limited follow-through dollar buying.  It peaked near JPY115.25 in Asia and fell to around JPY114.80, where it has found a bid in European dealing.  The nearly $950 mln option that expires today at JPY115 has likely been neutralized (hedged/offset), and the one at JPY115.50 for $1.2 bln may be too far away to be impactful.  Our idea of a JPY113.-JPY115 range is being tested, but recall that earlier this month, the dollar has slipped to almost JPY112.70.  The range is not carved in stone, and some fraying is inevitable.  Still, a move above JPY115.50 would suggest that this consolidation since mid-October is over, and a new and higher range is likely.  Next:  JPY118-JPY120, maybe.  The Australian dollar leaked lower and briefly dipped below $0.7200 for the first time since October 1.  There is an option that is expiring today there for about A$355 mln.  It steadied after early Asia Pacific trading and approached the nearby cap near $0.7230.  A move above here would help the technical tone.  Officials appear to have broken the one-way trading in the yuan.  It has been alternating between gains and losses this week, but the movement has been small, and the yuan is virtually unchanged this week.  The reference rate was set at CNY6.3903, slightly more than the market expected (Bloomberg) of CNY6.3898.   Lastly, we note that South Korea is widely expected to hike the seven-day repo by 25 bp tomorrow, following a similar hike in August.   Europe It has taken the better part of the two months, but the new German coalition appears to have been agreed upon.  However, what the soon-to-be Chancellor Scholz is inheriting is a mess.  The Bundesbank warned recently that the economy may be stagnating this quarter (though the flash PMI yesterday did not confirm this), and inflation may be approaching 6%.  Moreover, the covid infection rate has reportedly doubled in the past two days.  The US CDC put Germany (and Denmark) on a heightened travel advisory.   As one would expect, this is taking a toll on sentiment.  The IFO investor survey showed this.  The current assessment fell to 99.0 from 100.2.  The expectations component eased to 94.2 from 95.4.  The assessment of the overall business climate stands now at 96.5, down from 97.7. After falling for the fifth consecutive month,  it is at the lowest level since April.   The euro's losses were extended to almost $1.12.  The weakness seems most pronounced in Europe, which lends credence to ideas that European financial firms are key sellers, which some related to year-end adjustments.  However, the three-month cross-currency basis swap has steadied since Monday, and pressure on the euro remains.   We note that the two-year US-German interest rate differential rose for the fourth consecutive session yesterday to reach 135 bp, the most since last March, but is steadying today.  Since the convincing break of $1.13, we do not see strong chart support until closer to $1.10.  Sterling made a margin new low for the year yesterday near $1.3345.  It remains stuck near there in quiet turnover.  The $1.3400 area offers nearby resistance.  Here we see little technical support until around $1.3165.  America The US holiday tomorrow is forcing a heavy data release schedule today.  Not all the data is of equal importance.  Of the first set of reports, the weekly jobless claims will command attention.  They have fallen for the past seven weeks and are at their lowest level since the pandemic (268k).  The November national employment report is due at the end of next week, and another 500k jobs were thought to have been filled.  The October trade balance and durable goods orders are notable.  Nearly all the October data has been reported better than expected.  Growth differentials warn of the risk of a wider trade shortfall.  The revisions to Q3 GDP (likely higher) are unlikely to capture much attention as it is too backward-looking.   The second batch of data may see a bigger market reaction, especially in the debt market.  The US is expected to report a jump in personal spending (consumption needs to accelerate if the economy strengthens this quarter).  Income is likely to recover a bit from the 1.0% drop reported in September.  The market may be most sensitive to the deflators.  Here inflation is set to accelerate.  The headline is projected to rise above 5%, while the core should peak above 4%.   Lastly, new homes sales surged 14% in September and maybe lucky to sustain those higher levels in October.  Late in the session, when many in the US may be winding down ahead of the holiday, the FOMC minutes from this month's meeting will be released.  The current focus is on the possibility that the Fed accelerates its tapering next month, and anything that sheds light on this could shape the market's reaction.    The US dollar reversed lower yesterday after reaching CAD1.2745.  It settled near its lows (~CAD1.2670), but there has been no follow-through selling, and the five-day moving average, which it has not closed below since November 15, held (~CAD1.2660). Initial resistance is seen now around CAD1.2700-CAD1.2720.  We note that Canadian bonds are under some pressure, and the 10-year yield is above 1.80%, the highest level since April 2019.  The dollar rose to MXN21.30 yesterday and remains firm, even if off the high today.  News that Mexico's President pulled the nomination of Herrera, the former finance minister, as the next central bank governor, injected some volatility into the peso.  Reports suggest that Herrera's nomination was retracted a few months ago but was kept confidential.  It is not clear what happens next.  Some suspect Herrera may still get the nomination.  It does not appear that any official statement or clarification has been provided.  The median seems to be playing up the likelihood of some announcement in the coming days.  Meanwhile, Mexico reports its bi-weekly CPI figures, and inflation is still accelerating.  Tomorrow's final Q3 GDP is expected to confirm that the economy contracted.  The dollar recorded the high for the year against the peso in March near MXN21.6360.   Disclaimer
Cleaning Up with Carbon Credits

Cleaning Up with Carbon Credits

Callum Thomas Callum Thomas 25.11.2021 08:59
The price of EU carbon credits hit a fresh record high last week following COP26. Global carbon prices are up 4x off the March 2020 low and 9x above the 2017 nadir. Retail traders and advisors can access the space through a growing ETF While appearing a bit faddish and overheated, the bull market in carbon could still be in the early phases   Winter is coming. Households in China, Europe, and the States will be faced with higher than average heating bills due to this year’s spike in commodity prices—namely in natural gas and coal. In a similar vein, credits of carbon offsets have also surged.   Carbon: The New Asset Class?   Carbon as an asset class has grown in popularity. Trading (and holding) carbon credits is a market born out of regulation. Investors might be familiar with the “cap and trade” concept. The idea is that regulators cap the amount of carbon emissions and then allow emitters to trade the credits. A cleaner environment is the goal while allowing the market to discover a fair price.   Scarcity Meets AUM   High government regulation and surging fund flows culminated in an interesting and volatile situation this year. Carbon credits are scarce, but investor allocations continue to pour in. The buyers of these credits are, of course, energy and utility firms, but demand grows from other corporate entities looking to put their green foot forward. Even golfer Rory McIlroy is paying up to reduce his carbon footprint. Retail investors have interest, too. Naturally, as prices rally and volatility increases, speculative traders enter the scene.   Prices Rally Following Regulation Talks   Last week, the European Union Emissions Trading System (ETS) Carbon Price notched a new record high above €66 following the COP26 conference which happened to coincide with a cold snap in the region. Carbon credits often become more valuable during a summer heatwave or winter cold blast due to higher power burns and electricity generation to meet demand.   Getting In on the Game   Retail investors and advisors don’t need a futures trading seat or a source of institutional credit to get in on the carbon trading action. The KraneShares Global Carbon ETF (KRBN) tracks the EU ETC carbon price fairly well. KRBN traded with very low volume up until energy commodity prices began to surge in 2Q21.   Our Weekly Macro Themes report details the growing interest in this unique asset. This week’s featured chart illustrates how much money is pouring into the carbon credit space. We aggregated all the carbon credit ETFs that trade globally. AUM in these exchange-traded products was just a trace a year ago ($35 million) but now approaches $2.5 billion.   Featured Chart: Carbon Credit ETF Assets Under Management   The growth in ESG flows is no joke, and it seems like nothing is stopping that freight train. But is the parabolic move in carbon credit ETFs just another mini-bubble we have come to expect as pandemic stimulus ignites a wave of speculation? It has the hallmarks of just that. Investor interest is driving up prices, but the nuance here is that the speculators might be less demonized given the arguably positive benefits to climate change (in contrast to speculators in other energy and agricultural commodities).   Search Trends and Price Correlation   Our weekly report investigates the similarities between ESG’s growth and interest in trading carbon credits. There is an obvious link. Google Search Trends of “carbon” matches the price chart of the EU ETS Carbon index. From an impact investing standpoint, putting upward pressure on carbon prices is a very direct way of influencing climate outcomes (by raising the cost of emitting and incentivizing investment in clean tech).   Bottom Line: Is this the new hot trading craze? Speculating in carbon credits? We are not there yet, but growth in the niche is surging along with prices. The rise in speculative manias over the last 18 months collides with the powerhouse that is growth in ESG. The bullish combination has led to substantial flows into the asset class and new all-time highs in price.   Follow us on: Substack https://topdowncharts.substack.com/ LinkedIn https://www.linkedin.com/company/topdown-charts Twitter http://www.twitter.com/topdowncharts
Black Friday can squeeze supply chains and challenge Christmas

Black Friday can squeeze supply chains and challenge Christmas

Saxo Bank Saxo Bank 25.11.2021 08:31
Thought Starters 2021-11-24 14:00 Summary:  Black Friday is upon us and with the current pressure on supply chains the shopping frenzy may make it difficult for Christmas presents to reach stores in time for the Holidays. ‘Tis the season for shopping. While Thanksgiving still is primarily a tradition for Americans and people who are into American football, the Friday after, Black Friday, has become a global phenomenon, where shops across the globe make offers that can’t be refused.But, on the back of the COVID-19 pandemic, the act of getting goods from factories to shops, which is a task that’s previously been taken for granted, has become increasingly difficult.“Containers are generally shipped from the big ports in China to the big ports in Europe and on the US East and West Coast. The frequency with which this has happened has been challenged by a strong global economic recovery creating a strong demand for goods around the world. Simultaneously, we’ve all become accustomed to the fact that when we order something online, we get it delivered within a few days. That has broken down and we have to be much more patient now,“ says Ole Hansen, Head of Commodities at Saxo.In the picture below it can be seen that the amount of cargo being off-loaded and loaded in a port like Hong-Kong has fallen roughly 25 pct. on average from 2020 to 2021. This serves as an example of what Hansen describes above, i.e., that there are bottlenecks in the global supply chains, which make it harder for goods to go from one place to another and thus delivery takes longer. The picture also shows the massive price increase on shipping containers, which has almost tripled from 2020 to 2021. This indicates the imbalance between the “supply of logistics” relative to the demand of it. In other words, as a company it’s harder to get your goods in a container and on a containership and therefore get it to where it’s being sold. Therefore, you are willing to pay more for those containers. So where does that leave all the Black Friday shoppers?“Black Friday is going to happen even though I'm sure there's still a lot of stuff at harbours around the world, which is not going to reach the shops in time. But we have noticed something interesting; last month, the retail sales in the US surprised positively and it could potentially be consumers worrying that there won't be enough goods available when we get close to Christmas, so they're already stocking up on some of the goods they need to already now. Based on that it’s fair to assume we will have enough goods for Black Friday but Christmas is another matter,” says Hansen.What does this mean for investors?From an investor point of view, this is something to take note of, as it can have an impact on equities in both the logistics sector, as well as the e-commerce and consumer goods sectors. However, Head of Equity Strategy at Saxo, Peter Garnry, notes that with the right investment strategy, it shouldn’t be seen as a fundamental crisis: “There's always something we can worry about in the equity markets, but, as I tell the young people here at Saxo, who wants to listen to me: it pays off to be an optimist. I think you have to be an optimist about the world and these things will solve themselves. And if you stay true to being long-term in your investments and you remember to diversify your portfolio, then I think you’re off to a good start,” he says. If you want to have a look at some of the global logistics stocks and read more about the sector and its risks, you can invest in and get exposure towards these challenges, have a look at Garnry’s Logistics theme basket here (will open in a new window and require log-in to Saxo). If you instead want to have a look at his E-commerce basket, which is also affected by the supply chain issues, and read about its construction and risks, then take a look here (will open in a new window and require log-in to Saxo).
Ahead Of The US CPI, Speaking Of Crude Oil And Metals - Saxo Market Call

Market Quick Take - November 24, 2021

Saxo Bank Saxo Bank 24.11.2021 09:53
Macro 2021-11-24 08:40 6 minutes to read Summary:  US equity markets bounced back from an extension of the sell-off from the highs of Monday, perhaps in part as a firm US 7-year treasury auction saw yields settling back lower, just after that particular benchmark had notched a new high yield for the cycle. Today sees a flurry of US data and the FOMC Minutes all crammed into the last day before the long Thanksgiving weekend in the US, where markets are closed tomorrow and only open for short session on Friday. What is our trading focus? Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) - Nasdaq 100 recovered from steep losses late in yesterday’s session which has extended this morning on a positive session in Asia driven by improved sentiment in Chinese equities on good earnings releases. Nasdaq 100 futures are trading 1.4% higher than yesterday’s lows. The key thing to monitor is still the US 10-year yield and the USD for clues of where US equities are going. If Nasdaq 100 futures can extend their momentum today the 16,443 level is the natural gravitational point in this market sitting at the 50% retracement level over the past three trading sessions. USDJPY – The  USDJPY outlook is predominantly a question of “will it or won’t it sustain a break above 115.00?” And the answer to that question is likely coincident with whether long US treasury yields will rise above the 1.75% highs established earlier this year. After a strong 7-year US treasury auction yesterday, US longer yields dipped from session highs, drawing out the suspense on USDJPY direction here. AUDNZD – after the RBNZ meeting proved far less hawkish than the market has priced, it feels as if it will be difficult for the momentum in higher RBNZ rate expectations to return as the bank likely waxed a bit cautious overnight (more below) to give itself more time to assess how quickly the tightening in the bag and a few more planned hikes already priced in are affecting the NZ economy. In Australia, meanwhile, the economy is emerging from lockdowns and rate expectations could close the gap, with an additional possible source of support from China, where stimulus may be on the way, and where the anticipation of a rise in steel output has sharply boosted iron ore prices (Australia’s largest export). AUDNZD may have bottomed out now and we watch for whether this sharply rally off the bottom could have legs for at least 1.0600 as AU vs. NZ yield spreads mean revert. Gold (XAUUSD) trades higher after finding support ahead of $1781. The slump this week below  $1835 area was triggered by rising Treasury yields following the renomination of Jerome Powell as Fed chair. The oversized downside reaction, however, was caused by long liquidation from hedge funds who had been rushing into gold before and after the recent CPI shock. Gold’s short-term ability to bounce will mostly depend on whether the washout has triggered a big enough reduction of recently established and now loss-making positions. A sharp drop in open interest in COMEX gold futures and two days with double the normal trading volume could indicate most of the adjustments have now been executed. Crude oil (OILUKJAN22 & OILUSJAN21) jumped the most in two weeks yesterday after a US initiated release of strategic reserves underwhelmed in its size and details. Most of the oil being offered to refineries will have to be returned at a later date while international contributions were smaller than expected. Refineries are already processing crude near the seasonal pace so the market doubt how much extra oil they may need. Also, and more important, the OPEC+ alliance called the move unjustified given current conditions and as a result they may opt to reduce future production hikes, currently running near 12 million barrels per month. Ahead of today’s EIA stock report, the API last night reported a 2.3 million barrel increase with stockpiles at Cushing also rising US treasuries (SHY, IEF, TLT). At the beginning of the day, the yield curve bear flattened with 7-year yields breaking above 1.55% before the 7-year auction. It led many to believe that it could be a catastrophic bond sale as demand for Monday’s 2-year and 5-year Treasuries was weak. Surprisingly, bidding metrics were strong with the bid-to-cover ratio being the highest since September 2020, and the yield stopping through by 1bps at 1.588%. Following the auction, the yield curve steepened slightly amid lower breakeven rates and less aggressive rate hikes for 2022. We expect the bond market to continue to be volatile as the market adjusts expectations for rate hikes next year. Yet, the long part of the yield curve is likely to remain in check until a resolution to the debt ceiling is not found. Todays’ Personal Consumption Expenditures might revive inflation fears reversing gains in the Asia trading session. Italian BTPS (BTP10). Italian government bonds sold off for the second day in a row as German and French PMI beat expectations, hinting at the inevitable end of the PEPP program. To weaken sentiment in BTPS was also news that President Mattarella is going to vacate his position in January leaving a political vacuum. Parties are pushing Draghi to get that position to get rid of him and go to early elections. If that were to happen, the stability that Italian BTPS enjoyed since Draghi is leading the government will vanish provoking a fast widening of the BTPS-Bund spread. What is going on? EU gas prices surged back above $30/MMBtu (€90/GWh) yesterday in response to rising winter demand, low power production from wind farms and increased competition from Asia which is ramping up its LNG imports. The US imposing additional sanctions aimed at Russia’s Nord Strem 2 pipeline also received some unwelcome attention. Sky-high day ahead prices for power adding to the pain with some countries approaching record highs. Power plants are burning more coal which is cheaper and more profitable and it has helped drive the emissions future (CFIZ1) to a new all-time high this week above €70 per tons. RBNZ hikes only 25 basis points, statement somewhat cautious. The majority of market participants were looking for a 25-basis point hike from the RNBZ overnight, but enough were looking for 50 bps that the 0.25% hike to take the official cash rate to 0.75%  rate triggered a sell-off in the kiwi. But it was the guidance that was a bit more of a surprise than the rate move, as the RBNZ noted that, while further rate rises would be needed, “the Committee expressed uncertainty about the resilience of consumer spending and business investment....(and) also noted that increases in interest rates to households and businesses had already tightened monetary conditions.” The 2-year NZGB yield dropped 14 basis points overnight to 1.94% as the market lowered rate hike expectations out the curve. Turkish lira descent accelerates – yesterday was a wild day for the TRY, which fell almost 20% in a single day yesterday before stabilizing slightly, on fresh rhetoric from Turkish president Erdogan, who complimented the recent Turkish Central Bank decision to cut rates again and who continues to use belligerent rhetoric against the standard EM playbook for dealing with a devaluing currency (vicious belt tightening via rate hikes, etc.). Chinese equities are rebounding on good earnings releases. Yesterday’s earnings releases from Xiaomi, Kuaishou Technology, and XPeng  have lifted sentiment in Chinese equities. Kuaishou was a positive surprise given the technology crackdown in China and XPeng overtook NIO in Q3 on EV deliveries showing that the company can ramp up production. ECB Vice President Luis de Guindos says inflation drivers are becoming more structural. In a speech yesterday in Madrid, the central banker said that “the ECB is continuously pointing out that the inflation rebound is of a transitory nature....However, we have also seen how in recent months these supply factors are becoming more structural, more permanent.” Euribor futures far out into 2024 and 2025 are several ticks lower from recent highs, but also up a few ticks from yesterday’s lows, as the market is only pricing for the ECB to move back to 0% rates by around the beginning of 2025. What are we watching next? Busy US Economic Calendar ahead of long holiday weekend - the majority of US office workers take a long weekend that includes Thanksgiving Day tomorrow and the Friday as well, with a lot of the data that normally would have been spread out over the rest of the week all piled up into a heap in early US hours today. The key number to watch today is the October PCE Inflation numbers, where the headline “PCE Deflator” and “PCE Core Deflator” are expected to show year-on-year readings of 5.1%/4.1% respectively vs. 4.4%/3.6% in September, which would mean the hottest pace of inflation since the early 1990’s. Much later in the day we have the FOMC minutes from the November 3 meeting, which should be interesting for whether the debate on whether the Fed needs to tighten policy more quickly is becoming more heated. Earnings Watch – the rest of the week in terms of earnings will be quite light with today’s focus on Deere which sells equipment to the agricultural sector and thus is a good indicator on this sector. Wednesday: Deere Thursday: Adevinta Friday: Meituan, Pinduoduo Economic calendar highlights for today (times GMT) 0900 – Germany Nov. IFO Survey 1330 – US Weekly Initial and Continuing Jobless Claims 1330 – US Oct. Advance Goods Trade Balance 1330 – US Q3 GDP Revision 1330 – US Oct. Durable Goods Orders 1430 – UK BoE’s Tenreyro to speak 1500 – US Oct. PCE Inflation 1500 – US Final University of Michigan Sentiment Survey 1500 – US Oct. New Home Sales 1530 – EIA's Weekly Crude and Product Inventory Report 1700 – EIA’s Natural Gas Storage Change 1900 – US FOMC Meeting Minutes   Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app: Apple Spotify Soundcloud Sticher
Oil prices hold steady despite Biden announcement

Oil prices hold steady despite Biden announcement

Walid Koudmani Walid Koudmani 25.11.2021 09:23
Oil prices hold steady despite Biden announcement Oil prices have returned to their recent range despite the announcement from president Biden that the United States would be releasing some of its strategic petroleum reserves, a move which was meant to cool oil prices after many expressed concerns for the serious effects they are having on consumers and ultimately, the post pandemic economic recovery. While OPEC maintains its narrative and continues to expect a fall in demand towards the end of the year, the US along with a group of other countries are attempting to ease the pressure by tapping into their strategic reserves. As stated in the past, this move was unlikely to have a long term effect on prices since it would not be able to make a significant impact on total demand, and after a brief pullback which saw prices drop by around 4,5%, the move was reversed. Furthermore, we are seeing a faster than expected recovery in oil prices as Brent is trading above $80 once again and WTI hovers in the $78 range, this may worry markets once again as governments begin to run out of options to control the ongoing situation on the oil market. VirginMoney annual report paints optimistic picture Annual results from Virgin money continued to offer investors reassurance as they outlined the growing strength of the company which managed to increase its market share while reducing costs and ensuring expansion of the brand. The report also highlighted the ongoing effort to continue investing in different sectors of the business while also aiming to return to a sustainable dividend in the medium term and keeping up with technological advances. Despite some questions relating to the logistics and practical implementation of strategies, today’s report could be seen as an overall positive and may reaffirm confidence in the board as it managed to deliver on many of its promises and could continue to do so moving forward.  
Cryptocurrencies to be tested this holiday season

Cryptocurrencies to be tested this holiday season

Alex Kuptsikevich Alex Kuptsikevich 25.11.2021 09:13
The bitcoin price changed slightly over Wednesday and is moving Thursday morning without a clear direction, around $57.3K. In the past 24 hours, the rate has added 1.6%, slightly better than the dynamics of the entire crypto market, whose capitalisation is up 1%. The observed strengthening of bitcoin right now is nothing more than a sign of the pull into a more liquid instrument from several other major altcoins. Cardano, for example, came under pressure yesterday, losing more than 10% intraday, but managed to bounce back somewhat by the close of the session. Solana is digging 4.5% in 24 hours, and Polkadot is under pressure. Due to pressure on top altcoins, the cryptocurrency Fear and Greed Index remains in the fear territory, at 32, where it was last in early October. BTCUSD, remaining below its 50-day moving average, is in the clutches of the bears, threatening to ramp up its fall. Many bulls seem to have moved into Ether, which, time after time, manages to fend off sellers, staying above its 50-day moving average and building up positions above $4000. The upcoming US holiday season promises to be an important test of crypto-enthusiasts strength. Four years ago, Bitcoin collapsed sharply around Christmas: probably due to the eagerness of investors at the time to lock in multiple price increases for that year. Advances in cryptocurrencies not only make them easier to buy but also easier to sell. The top coins are easy to pay for, and many can be easily, cheaply, and quickly exchanged for fiat currencies. As the crypto market stalls and inflation eats away at physical commodity prices, conditions begin to form where retail and casual investors who are not long-term crypto-enthusiasts may want to lock in profits and exit the market for the coming months ushering in a sell-off season for altcoins.