The English expression: May you live in interesting times is actually a derivation of the old Chinese proverb which was purportedly a curse. Nonetheless, we find ourselves at one such juncture today: Equities markets are enduring massive turbulence and investors are seeking safe-haven alternatives for their financial portfolios. Throughout modern history, gold has remained the safe-haven asset of choice. The recent Brexit referendum has highlighted the importance of gold bullion as the go-to investment, or store of value, while financial markets endure a category 5 storm. Gold Performance Blows Away the Competition If we look at the perform...
For analyzing the best pairs to trade looking from a longer term perspective the last 3 months Currency Classification can be used in support.This was updated on 10 July 2016 and is provided here for reference purposes: Strong: USD, JPY, NZD. The preferred range is from 6 to 8. Average: CHF, CAD. The preferred range is from 5 to 6. Weak: EUR, AUD, GBP. The preferred range is from 1 to 3. ______________________________________ 13 Weeks Currency Score Strength The 13 Weeks Currency Strength and the 13 Weeks Average are provided here below. This data and the “3 months currency classification” are considered for deciding on the pre...
After three public appearances from Mark Carney, it is now time to act on the monetary front. Will the BOE cut rates, announce more QE or do both? For a change, this is a live meeting that will determine the next move in GBP and the market mood. In the US, a look into the US consumer via retail sales and consumer confidence. Also of importance are China’s GDP, Canada’s rate decision and other events. Video preview for the week of July 11-15: Video length: 00:04:32 ...
This week’s U.S. news was remarkably bullish. The service sector’s PMI reading was very strong and the surprisingly solid employment report may have put an end-of-the-year rate hike back on the table. As a result, the SPYs finally broke through key resistance to make a new high. But stocks are still expensive. And with another weak earnings quarter fast approaching, it remains doubtful equities will be able to make and hold meaningful gains. The ISM service’s report was very strong: the index increased 3.6 points to 56.5; activity rose 4.4 points to 59.5 and new orders gained 5.7 points to 59.9. 15 of 18 industries reported positive...
Investors are under siege. A growing proportion of bonds in Europe and Japan offer negative yields. The German and Japanese curves are negative out 15-years, while one cannot find a positive yield among any tenor of Swiss government bonds. Despite a string of robust data, US Treasury coupon yields are at record lows. The UK referendum hit an already vulnerable banking system in the eurozone. Italian banks are on the front burner, but the temperature is rising in Portugal, and this is not to mention the slow boil at some of the largest European banks, specifically singled out by the IMF as posing the greatest systemic risks. Politics add an ...
Monday: May Machine Orders data will be released in Japan. In Italy, May Industrial Production data will see light, followed by June’s Housing Starts data being released in Canada. Tuesday: June’s Producer Price Index will be released in Japan. In Germany, the final estimate of June’s Consumer Price Index data will see light, currently pointing at a 0.3% annual inflation. Wholesale Inventories data will be released in the U.S. Wednesday: The Final estimate for May’s Industrial Production data will be released in Japan. In France, the final estimate for June’s CPI will see light, currently indicating 0.2% annual inflation, followe...
For roughly a year and a half to describe market conditions, I’ve borrowed and used a concept from two classic TV shows. The Twilight Zone’s Terror at 20,000 Feet and The Simpson’s Terror at 5 ½ Feet. Both episodes depict a lonely passenger who looks out the window and sees a gremlin that nobody else can see. As recently as last Thursday and after we all went paragliding, we watched the Dow nearly launch to 18,000. Many came up with viable theories why gremlins in the market continue to exist. And then last Friday, with the help of a much better than expected unemployment number along with an increase in wages, up in the air our pa...
We will be looking this week at the Top 15 because otherwise the only strong currency would be the JPY and the only weak currency the GBP. When looking at the Top 15 in the Weekly Ranking and Rating list we can see that for the coming week the following stronger currencies are well represented for going long: JPY(6X) followed by the NZD(4X) and the USD(2X). The weaker currencies are the GBP(6X) followed by the EUR(4X) and the CAD(2X) A nice combination for coming week may be e.g: GBP/JPY with the NZD/CAD GBP/USD with the EUR/NZD GBP/NZD with the CAD/JPY EUR/JPY with the GBP/USD EUR/JPY with the NZD/CAD These are just a few examples and ...
On Wednesday, the Federal Reserve released the Minutes from their June 14-15 meeting. As always, this document provides a comprehensive overview of the current state of the U.S. economy. A majority of the discussion centers on coincident indicators, which are depicted below: The above chart plots industrial production, total payroll employment, trade and manufacturing sales and total income less transfer payments on a base 100 scale dating from June 2009, which, according to the NBER, is when the recession ended. Industrial production (red line) is the only number declining; the other three are rising. The Conference Board provides another pe...
Fundamental Forecast for Gold:Neutral Gold at 2011-2012 Trendline; Major Decision Point Gold Prices Top June High But Fall Short of Convincing Breakout Gold prices advanced for a sixth consecutive week with the precious metal up more than 0.9% ahead of the New York close on Friday. Although bullion closed firmer on the week, prices were well off their highs after a strong U.S. Non-Farm payrolls report on Friday quelled fears of a slowdown in labor markets. Some traders may be asking, ‘why is gold so strong in the face of rising equity prices and a stronger dollar?’ The answer may not be clear cut, but the recent rise does suggest that al...