Daily Close | Forex, Metals, Oil, Agriculture October 16, 2020

Agriculture

USDA said that net weekly Upland Cotton export sales were 98,900 bales this year and 13,200 bales next year. Corn futures in China hit record highs this week while their output is lower due to typhoons and in other places of their Corn Belt drought. Ideas are that most of the Cotton crops in the region have open bolls now and that some significant damage might have been done due to wind and rain. So we can’t sell them at that, you know you just can’t make money doing that,” said Robin Hannon, owner of Timmy Crack Corn.
In the overnight electronic session, the December corn is currently trading at 407 ¼ which is 3 ½ cents higher.

Currencies

But major gold uplegs coincided with US Dollar Index downlegs, and major gold corrections unfolded on USDX rebound rallies. In times when stock-market capital is deluging into gold, this metal can indeed decouple from the US dollar because stock traders don’t care about it. Dollar trends are important trading cues for highly-leveraged gold-futures speculators, who wield outsized influence over gold prices. It superimposes gold’s price action during this secular bull over the US Dollar Index’s own along with some of its key technicals.
That’s because gold and the US dollar rallied simultaneously through most of 2019, leading many to assume that the dollar-gold link was broken. So flowing and ebbing dollar levels directly impact prevailing gold prices. Gold generally tends to rally when the dollar weakens, then sell off when it strengthens again. Nothing motivates them to buy or sell gold futures more than dollar swings. Today’s beaten-down US dollar is a major short-term risk for gold.
That’s why the current low US dollar is a serious short-term threat to gold. This USDX applies a weighted geometric mean to a basket of major world currencies to track the relative value of the US dollar. Gold has proven the ultimate universal global money for millennia now, and its US-dollar price American speculators and investors follow is simply these currencies’ exchange rate. Source: Bloomberg Despite the dollar gains, oil prices managed to eke out a gain but PMs were weaker led by silver…
So an overdue mean-reversion rebound rally erupting in the US dollar will unleash serious gold-selling pressure. Despite episodes when big differential gold-ETF-share buying worked to overwhelm and suppress the classic dollar-gold relationship, it has still greatly influenced this overall gold bull. Source: Bloomberg The dollar ended higher on the week but stalled at last week’s highs… The leading dollar benchmark reveals this powerful inverse correlation.
That is the venerable US Dollar Index, which was launched way back in March 1973. But this year’s volatile US-dollar action began during mid-March’s brutal stock panic. The Eurozone countries’ euro, Japan’s yen, and the United Kingdom’s pound sterling dominate the USDX commanding 57.6%, 13.6%, and 11.9% of its total weighting.

Metals

That happened to varying degrees, depending on how much capital stock traders were pumping into or out of physical gold bullion through those big gold ETFs. Gold was powering higher on massive inflows of stock-market capital through major gold ETFs. In fully 7/8ths of these segments covering the large majority of this gold bull, gold inversely mirrored the USDX. The overwhelmingly-dominant ones are the GLD SPDR Gold Shares and IAU iShares Gold Trust. But much of the time stock traders aren’t frenziedly shunting vast amounts of money into gold via those major-gold-ETF conduits.
This current gold bull has enjoyed four major uplegs and suffered three major corrections.
In his writing and research, Sumner specializes in monetary policy, the role of the international gold market in the Great Depression, and the history of macroeconomic thought. Before that ugly stock-market selloff cascaded into a full-blown panic, which is a 20%+ plummeting in two weeks or less, gold climbed to $1675 in early March. But it merely went dormant, taking a back seat to another big gold driver.
(LTC-USD): If Bitcoin is akin to digital gold, then Litecoin is somewhat akin to digital silver. Source: Bloomberg Gold managed to hold above $1900… WTI managed to surge back to $41 after a decent intraweek plunge… The USDX’s sometimes-domineering influence over gold prices has faded off traders’ radars in recent years. They chase gold upside momentum, fueling virtuous circles of buying. In these more-normal conditions, speculators’ gold-futures trading dominates gold’s price action. In fact, Dr. Vladimir Zelenko, Dr. Harvey Risch, Dr. Simone Gold, and Dr. Jay Bhattacharya, to name a few.
Just over a month ago I wrote a comprehensive essay analyzing this critical gold-moving dynamic. Look into nickel smelting and lithium mining.

Oil

At HFI Research Natural Gas, we give you guidance on natural gas fundamentals, weather, and set-ups to help you navigate the dangerous natural gas market. For readers investing or trading natural gas or natural gas equities, don’t be blinded by the incoming moves. We also write daily and weekly reports, covering key variables in U.S. natural gas market (supply, demand, storage, prices and more). Granted, this is a squishy phrase as we’re short on oil but far, far ahead in natural gas.
Longer term, the fall in Lower 48 production will be very bullish, and we want to get positioned in the right natural gas producers to take advantage. I find it hard to believe that, in a year of pandemic and economic weakness, the recovery in oil and gas activity might be imminent. One thing that was a tailwind and now turned into a headwind is the return of all the shut-in natural gas production. Oil and gas prices didn’t rise as a result of his victory, but business confidence did.
Moderates simply don’t choose vehemently anti oil and gas lightning rods as successors, advisors and top cops. So, I guess we at least know where she stands, a breath of fresh air given the chicanery of the Biden-Harris oil and gas platform. The “cold season” is the time of high volatility in natural gas markets. When President Trump won the 2016 presidential election, the oil and gas industry immediately turned on after a punishing two-year downturn. McClendon’s sin was being incredibly effective at deploying fracking to free up natural gas.
as a means to offset possible declines in oil and gas activities.
Natural gas is primarily a winter commodity. It is as dirty as any old school oil and gas project, only more so. That’s really too bad because shale oil is light and low in sulfur and is clean compared to most other grades of oil. With less investment, there is less manufacturing of inputs used in investment, like oil pipelines for frackers. It probably did not help that crude oil also failed to find support on Friday, on fears of oversupply in 2021. The Renewable Fuels Association said the volume of gasoline supplied to the market was lower than last week but refiners’ imports were higher.

United States

This suggests that even if Fed officials wanted to ease terms on the Main Street program in the future, they might not be able to. But the company’s 38% YOY revenue decline was the sharpest since 2015, and it missed Wall Street’s consensus by the widest margin of the past five years, at least. Boeing has been one of the most consistent successes of the US economy for the last fifty years. Therefore, the strategy to focus more on the UPS market makes sense but a lot will also depend on the execution.
Stocks fell on Wednesday after a few Mnuchin lowered expectations for a stimulus deal before election. Case in point – BPY currently holds a 19% share in high-quality retail real estate in the US, with its footprint typically located in close proximity to peoples’ homes. Headquartered in Clayton, Missouri, Enterprise Financial Services Corp. (NASDAQ:EFSC) is a $8.3 billion asset holding company and parent to Enterprise Bank & Trust. This marked the first time that the Fed undertook a tax-exempt quantitative easing program.
Bloomberg s editorial board Trump can t steal the election without a lot of help from people at all levels of government. Source: Bloomberg Big-tech names managed gains (NOTE that buying panic on Monday driven the Nasdaq Whale reappearing and buying calls with both hands and feet)… Then as the stock selling intensified and the Fed panicked slamming rates back to zero, the oversold USDX rocketed higher in a stratospheric spike.
Steps taken this time included offloading OneStim to Liberty Oilfield Services (NYSE:LBRT) in the US and Canada, and divesting Schlumberger’s low-flow artificial lift business for cash. The company is seeking to obtain capital from U.S. investors with its proposed Nasdaq listing. Teresa Ghilarducci ICYMIBiden s town hall got bigger ratings than Trump s.Europe cleared Boeing s 737 Max to fly.Billionaire Robert Smith admitted to evading taxes. The instinct to make every problem about “the numbers” is strong on Wall Street.
Keep on alert for some possible unilateral action by President Trump. He has been quoted in a variety of financial news publications, such as CNBC, the Wall Street Journal, and the New York Post. Further ReadingThe stick of Trump s maximum pressure campaign on Maduro isn t working. The Wall Street Journal comments on the Strong Retail Sales Numbers. Its main customer is the US Department of Defense.

China

The group, the China Entrepreneur Club (CEC) included CCP loyalists, Chinese billionaires and at least one “respected diplomat” from Beijing.

Europe

That would be an economic catastrophe for the U.K. and downright unpleasant for the EU.Today, careful observers of the calendar will note, is Oct. 16, and no catastrophe. Each bit of faltering bluster only undercuts trust in Johnson while binding EU members closer together, Lionel writes. In the process, Johnson may unintentionally be creating an even more powerful trading rival than when this whole Brexit foolishness began. Of course, though the EU has the upper hand, a no-deal Brexit won t be good for it, either, writes Therese Raphael.
Negative long-term structural dynamics have been exacerbated by the decision to leave the EU and by the that meaningfully replicates the benefits of EU membership.
The EU called him on it and he backed down, Lionel Laurent writes. Boris Johnson keeps digging a deeper Brexit hole. Brexit talks are still ongoing.

0