Analysis Topic: Commodity Markets - Metals, Softs & Oils
The analysis published under this topic are as follows.Saturday, February 17, 2018
Crude Oil Prices: A Case of Dueling Narratives? / Commodities / Crude Oil
There are indications Crude Oil prices are going lower. There are also indications that it’s going higher. Which narrative do you believe?
Oil Bears point to what they believe is over-supply caused by soaring US production, mostly from shale fields. With production increasing over +20% in less than two years, and drill rigs on the rise, the US now produces about as much Oil as the industry leaders, Saudi Arabia and Russia. According to the Oil Bears, the Saudi-Russia pact to restrain global production and export levels will break down in 2018, thereby leading to more supply than demand, causing lower prices. Moreover, the Bears are confident that alternative energy supply (e.g., solar/battery and uranium) will eventually win out as it is a cheaper and cleaner power source, and that Electric Vehicles are increasingly favored by consumers.
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Friday, February 16, 2018
GDX Gold ETF Weathers Stock Market Selloff / Commodities / Gold and Silver Stocks 2018
The gold miners’ stocks weathered the recent stock-market plunge really well. As evident in their leading GDX ETF, they were already beaten down before stock markets started falling. The resulting explosion of fear bled into GDX, forcing it even lower. Nevertheless, no major technical damage was done. GDX remained well within its consolidation trend channel and is still within striking distance of a major $25 breakout.
Gold stocks’ behavior during stock-market selloffs can seem capricious. This small contrarian sector generally amplifies the price action in gold, which drives its collective profitability. Gold tends to surge in the wake of major stock-market selloffs, which erode investors’ confidence in stocks’ near-term outlook. That greatly boosts gold investment demand as investors soon rush to wisely diversify their stock-heavy portfolios.
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Friday, February 16, 2018
Gold Up 3.8% In Week – If Closes Above $1,360/oz Will Be Biggest Weekly Gain In Nearly 2 Years / Commodities / Gold and Silver 2018
Gold rose as the dollar fell to near a three-year low against a basket of currencies on Friday, heading for its biggest weekly loss in nine months, as a slew of bearish factors including firming inflation and a fall in retail sales and industrial production hit the dollar.
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Friday, February 16, 2018
Allow The Precious Metals Market To Prove Itself / Commodities / Gold and Silver 2018
We have been here several times before over the last year. The market has bottomed, provided us with a strong rally, but has failed to confirm the major break out for which we have been looking.
As I noted over the weekend, the 144-minute silver chart has been quite prescient in identifying turns in this market. And, it has still not yet failed us. But, the question is what type of turn are we seeing right now?
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Thursday, February 15, 2018
Strange Link between Inflation and Gold / Commodities / Gold and Silver Stocks 2018
It was a strange day. Inflation surged yesterday. But gold dropped initially, only to quickly reverse the fall and fly into the air. What happened? And – importantly – will gold soar on the inflation fuel?
Inflation Rears Its Ugly Head (or Tries to, at Least)
The recent payrolls report showed that wages had jumped 2.9 percent in January on an annual basis. It was the best result since 2009, which awakened fears of inflation. That’s why investors awaited yesterday’s data on consumer prices. On Tuesday, we warned our readers: “(…) tomorrow, we will see the newest CPI report, which may affect the markets, given that inflation worries were one of the key reasons behind the recent stock market volatility.”
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Thursday, February 15, 2018
For Gold, It's Goldilocks Inflation / Commodities / Gold and Silver 2018
Rudi Fronk and Jim Anthony, cofounders of Seabridge Gold, delve into the question of whether inflation is good for gold.
Is inflation good for gold? It depends. If inflation provokes a hawkish Fed to raise rates faster than inflation, not so much. But if the Fed is worried about the stock and bond markets and therefore won't raise rates fast enough to keep pace with inflation, that's good for gold. And that's where we seem to be now.
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Wednesday, February 14, 2018
This Chart Says Gold Is Beginning a Long-Term Uptrend / Commodities / Gold and Silver 2018
There aren’t many investment scenarios you can point to with any degree of certainty and say, “This asset is going to rise.” Saying so is usually fraught with risk, even if in hindsight it turns out to have been an accurate call.
But there are certainly times when you can see that the odds are heavily stacked in your favor. And we have one of those potential scenarios right now in gold.
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Wednesday, February 14, 2018
Things Only a True Friend Would Say About Gold / Commodities / Gold and Silver 2018
We live in very specific times. Getting a “like” on a post or picture becomes a necessary daily activity and means of self-validation. Not “liking” something that others posted or that is massively “liked” like may be frowned upon or even viewed as being disrespectful. Plus, it seems that no matter what you do, everyone gets offended very easily. When did honesty, independence and common-sense stop being virtues?
When it comes to gold investments and gold investment analysis, it’s surprisingly similar. You either like gold and think that it’s going higher right away or you’re “one of them”. “Them” can be anyone who tries to manipulate gold or silver prices, “banksters”, or some kind of unknown enemy. “Analyst’s” goal is often no longer to be as objective as possible and to provide as good and as unbiased analysis as possible, but to simply be cheering for gold and provide as many bullish signals as possible regardless of what one really thinks about them. The above may seem pleasant to readers, but it’s not really in their best interest. In order to make the most of any upswing, it’s best to enter the market as low as possible and to exit relatively close to the top. What happens before a price is as low as possible? It declines. Why would something like that (along with those describing it) be hated by gold investors? It makes no sense, but yet, it’s often the case.
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Wednesday, February 14, 2018
Understanding Crude Oil Behavior / Commodities / Crude Oil
On Monday, oil bulls extended gains after Friday's invalidation of the breakout, which together with the buy signal generated by the Stochastic Oscillator suggest further improvement. A least at the first sight. But does watching the room through the keyhole give us a full picture of what's inside? We also think so, therefore, we invite you to analyze a broader picture of crude oil.
Let’s analyze the charts below (charts courtesy of http://stockcharts.com).
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Tuesday, February 13, 2018
Gold and Silver Long-term Buy, Short-term Sell Signal / Commodities / Gold and Silver 2018
Technical analyst Jack Chan charts the latest movements in the gold and silver markets.
Our proprietary cycle indicator is down.
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Tuesday, February 13, 2018
Gold Key Change That Nobody Talks About / Commodities / Gold and Silver 2018
Last week, everyone focused on the stock market sell-off. Reasonably enough, given the pace of the declines. But the analysts failed to pay enough attention to the very important shift. That change may be more important than Trump’s victory in the presidential election. Will the critical switch make gold shine – or dull?
Three Important Legacies of Yellen’s Fed Tenure
A crucial change is behind us. Powell is the new boss. Yellen is out. For better or worse, she doesn’t serve as the Fed Chair any longer. Although economists rated Yellen’s tenure very highly, President Trump didn’t renominate her for the position. Rightly or not? We don’t care. Let journalists debate endlessly – we will analyze the crucial Yellen’s imprints on the Fed, which could affect the gold market in the future.
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Tuesday, February 13, 2018
Gold Stocks Groundhog Week / Commodities / Gold and Silver Stocks 2018
The physical metals will continue to outperform mining shares until there is some stabilization in the global arena, posits precious metals expert Michael Ballanger.
In the "I hate to say I-told-you-so" category, it looks like the Punxsutawney Phil came out of his den last week, took one look at the state of the global stock markets, and decided to go back to bed for six years. One short week after I posted "Never Underestimate the Replacement Power of Equities Within a (HYPER) Inflationary Spiral," complete with a chart with five smiling faces of those that would be responsible for "Dow 25,800," we have lost a very quick 2,000 Dow points and 105 for the S&P 500. The VIX (CBOE Volatility Index) has moved from around 9 to nearly 50 and the UVXY [Proshares Trust Ultra VIX Short-Term Futures ETF] ("the divorcee-maker" since 2009) went from $8.52 topping over $30 on Monday.
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Monday, February 12, 2018
Platinum Looks Poised for Surprising Gains This Year / Commodities / Platinum
Mike Gleason: It is my privilege now to welcome in Greg Weldon, CEO and president of Weldon Financial. Greg has over three decades of market research and trading experience, specializing in the metals and commodity markets, and even authored a book in 2006 titled Gold Trading Boot Camp, where he accurately predicted the implosion of the U.S. credit market, and urged people to buy gold when it was only $550 an ounce. He is a highly sought after presenter at financial conferences throughout the country, and is a regular guest on financial shows around the world, and it's great to have him back here on the Money Metals Podcast.
Greg, it's nice to talk to you again, and thanks for coming on.
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Monday, February 12, 2018
Gold Mining Stocks Have Been The Most Frustrating Trade For The Last Year / Commodities / Gold and Silver 2018
For those that follow me regularly, you will know that I have been tracking a set up for the VanEck Vectors Gold Miners ETF (NYSEARCA:GDX), which I analyze as a proxy for the metals mining market. I believe that the GDX can outperform the general equity market once we confirm a long term break out has begun, and I still think we can see it in occur in 2018. But, after last week’s break down below the December 2017 low, the set up will have to be resurrected first in the coming months.
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Monday, February 12, 2018
What Does the Stock Market Decline Mean for Gold / Commodities / Gold and Silver 2018
It was a rough week for investors in stocks and stocks of all kinds. The S&P 500 lost 5%. Emerging Markets also lost 5%. Gold Stocks, which had weakened before the broader equity market have been hit hard. They (GDX, GDXJ) also lost 5% last week. The HUI Gold Bugs Index (which excludes royalty companies unlike GDX) lost 7%. After a strong start to the year, gold stocks have essentially given back all their gains. Nevertheless, we remain extremely optimistic on gold stocks over the next 12-18 months as trends in the economy and stock market should begin to support Gold after the second quarter.
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Friday, February 09, 2018
Mars and Mercury Decide the Fate of the U.S. Dollar and Gold / Commodities / Gold and Silver 2018
The U.S. dollar has been bleeding recently, despite all the Fed’s tightening efforts and the passage of Trump’s tax cuts. An accelerating economy, rising interest rates and pro-growth reforms should logically drive the value of the American currency. But they didn’t.
Given the strong negative correlation between the greenback and gold, finding the cause behind the dollar’s wounds is highly critical. The most common explanation among analysts is Trump the Destroyer. It shouldn’t be surprising, as the U.S. President is known for his passion for trade protectionism. He also explicitly favors the weak currency to help the exporters. So maybe Trump just got what he wanted?
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Friday, February 09, 2018
Crude Oil $100 Price in 2019? / Commodities / Crude Oil
The stock market is a dangerous place to be right now. Watching VIX spiked from 17 to 50+ then crashing back to 30 within two days can certainly cause a cardiac arrest or two. What’s even worse is that investors took this little dip as a buying opportunity throwing more good money at this deformed market. On Tuesday U.S. stocks rebounded to post the biggest rally in 15 months. We have discussed many times that stocks have a long way to go before any normalcy may be restored. On that note, let’s move to the oil/gasoline market instead.
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Thursday, February 08, 2018
Peak Gold: 2017 Supply Flat As China Output Falls By 9% / Commodities / Gold and Silver 2018
– China gold production falls by 9% to 420.5t in 2017
– Chinese gold demand rose 4% to 953.3t in same period
– China is largest producer and accounts for 15% of global gold production
– China does not export gold. Increasing foreign gold acquisitions to meet demand
– Global gold production flat – 3,269t in ’17 from 3,263t in ’16, smallest increase since ’08
– Peak Gold is here: supply set to fall gradually while global demand remains robust
Thursday, February 08, 2018
U.S. Dollar Appears to be Bottoming. Is this the End of the Commodities Rally? / Commodities / Commodities Trading
The U.S. dollar appears to be finding a floor at $0.885 after six weeks of sharp declines. What does that mean to commodity prices?
The "Big dollar" slid almost six percent since mid-December aiding many commodity prices to stage a strong rally.
Gold bounced up 8.4 percent, silver soared 10 percent and WTI roar upward by 15 percent.
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Wednesday, February 07, 2018
Oil Prices Ravaged By Financial Turmoil / Commodities / Crude Oil
Oil prices fell back suddenly over the last few trading sessions, dragged down by some forces beyond the oil market.
The steady decline of the U.S. dollar has helped drive up crude prices for weeks, but that came to an abrupt halt last week. A rebound for the greenback led to a steep decline in oil prices on Friday.
At the same time, sudden turmoil in the broader financial system also bled over into the oil market. Volatility in the stock market flared up on Friday, sparking the sharpest single-day upheaval in years.
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