Crude Oil fund USO is tickling a lower short-term low today and that is not a good sign for the would-be bottoming process that people seem to be managing.
We noted in this week’s NFTRH report that Crude had been struggling with the MA 50 and here is USO turning down from it today. We also noted that commodities continue to look precarious at best, with a few outliers like RE, Lithium and Uranium making bounces.
Further, a weekly chart of the USD shows what looks like a consolidation, not a correction in the making. Given the pervasive bullishness on the USD, I have thought it would have taken a decent correction by now, with all the anti-USD stuff bouncing. But so far, it’s not happening.
Guest Post by David Stockman & Stealthflation
Commodity Prices Are Cliff-Diving Due To The Fracturing Monetary Supernova—The Case Of Iron Ore
Crude oil is not the only commodity that is crashing. Iron ore is on a similar trajectory and for a common reason. Namely, the two-decade-long economic boom fueled by the money printing rampage of the world’s central banks is beginning to cool rapidly. What the old-time Austrians called “malinvestment” and what Warren Buffet once referred to as the “naked swimmers” exposed by a receding tide is now becoming all too apparent.
This cooling phase is graphically evident in the cliff-diving movement of most industrial commodities. But it is important to recognize that these are not indicative of some timeless and repetitive cycle—–or an example merely of the old adage that high prices are their own best cure.
Instead, today’s plunging commodity prices represent something new under the sun. That is, they are the product of a fracturing monetary supernova that was a unique and never before experienced aberration caused by the 1990s rise, and then the subsequent lunatic expansion after the 2008 crisis, of a cancerous regime of Keynesian central banking.
Continue reading Commodity Cliff Dive…
I find it kind of lame when someone puts up a chart with a heading like ‘The most bearish/bullish/important/profound, etc. chart in the world’. Here we cue memories of a funny post at some website with “the most bearish gold chart in the world” back when gold was well down in the triple digits.
Look, chart guys are proud of their charts and proud of their analysis, I get it. I think highly of my own work. But I don’t think highly of hype (as if you haven’t gleaned that by now) so I’ll just robotically remind you that this chart, the most ********* chart in the (financial) world, is in a big picture uptrend and never stopped being in one.
The number of characters in ********* actually fits at least 2 good descriptors I can think of for the above.
Folks, this chart is from yesterday’s close. Commodities are down hard again today. They are also deeply over sold, yet I still want nothing to do with them (note to self… don’t let silver drop too far with those calls still in hand). 500 is the key level per this weekly NFTRH chart we have used since well before CCI’s breakout early in the year.
It is time to be considering that the age of inflation or more accurately its cost-effects may be over.
It is time to be considering that inflation gurus set up a cottage industry in scaring everybody about hyper inflation.
It is time to be considering that for now the US economy and stock markets benefit from a transitional Goldilocks phase.
It is also time to consider the message that commodities may be sending for a day when that pendulum (the lack of inflation expectations) swings too far.
Joining its friends in the commodity and precious metals complexes, the daily Palladium chart is starting to get bearish as if on cue, after reading this article at Kitco.
Aside from instructing that the 50 day moving average is a place to bet against Palladium for those who wish (we’ll call this a public NFTRH+ style highlight, without the other parameter details), the “major uptrend in 2014″ that the article talks about is busted.
Macro geeks like your writer will be using Palladium in relation to Gold going forward as but one tool among many in gauging the macro. After all, that’s where the real interesting stuff is, as opposed to any single asset class in my opinion.
Copper is a tough one. If copper hangs in and hints at an ‘inflation trade’ (i.e. anti-USD) bounce to come, I’d like to buy COPX or FCX. The charts are coming along nicely. COPX was NFTRH+’d recently for just such an occasion.
The weekly chart of copper is trying to hold above a downtrend breakout line and hold a trend out of March.
But the monthly chart is still disgusting, a year or so after it was created…
Continue reading Doctor Copper Updated
Inflation bulls* avert eyes…
DBC new lows…
USO at lows (a weekly chart of WTIC in NFTRH 303 noted crude is at a ‘if crude is going to rally it needs to do it now’ level)…
Continue reading Commodities Snapshot
Last week we did an NFTRH+ on Uranium in general, with a focus on the Global X fund URA. I personally decided to take a try with its largest holding, Cameco today on the drop to the SMA 200. The next clear level is at just above 20.
Of interest is Uranium holder Uranium Participation, U.TO, as it sports a healthy premium to its NAV as of the end of June ($CAD 4.03/share vs. today’s stock price of 4.95).
Continue reading Uranium; Hype or ?
I am long DBB and the intent is just as a trade. But the big picture view of the Industrial Metals index shows a break above resistance this month out of a large falling wedge. If that is not reversed by month’s end, then we’ll have to think about the base metals a little more seriously. For now, the candle could easily sag back below the red line.
Guest Post by Tom McClellan
June 21, 2014
The news stories about crude oil in the financial media have been all about how oil prices have been volatile based on the crisis in Ukraine, the crisis in Iraq, the crisis in Nigeria, the lack of a Keystone pipeline, etc. But what has been underreported is that there has actually been hardly any volatility at all.
Continue reading Crude Oil Abnormally Quiet
Guest Post by Ino.com
|CRUDE OIL Aug 2014
|NY HARBOR ULSD HEATING OIL Aug 2014
|NATURAL GAS Sep 2014
|RBOB GASOLINE Aug 2014
|POWERSHARES DWA ENERGY MOMENT
|UNITED STATES GASOLINE
Continue reading Key Market Report – Energies