Open: New York Session | Forex, Metals, Oil, Agriculture September 01, 2020

A member of the National Guard plays a trumpet during a flag rai


less Uptrend scenario The uptrend may be expected to continue, while the wheat market is trading above support level 539, which will be followed by reaching resistance level 573. Downtrend scenario A downtrend will start as soon, as the wheat market drops below support level 539, which will be followed by moving down to support level 516. That includes 17.5 million tonnes of wheat, 26 million tonnes of corn and 3.3 million tonnes of barley. Europe s wheat crop shows mixed results as harvests near completion Wheat harvesting is ending in the largest European producers with greatly differing results, observers said on Monday.
Statscan pegged the all-wheat harvest at 35.7 million tonnes, up from last year’s 32.3 million and slightly exceeding the average trade expectation. The U.S. Department of Agriculture has forecast very strong domestic corn use and exports over the next year, which makes sense as the latest outlook includes a record harvest.
Arabica coffee futures prices rose to the highest in eight months on ICE on Monday and cocoa futures touched a seven-month peak as investors continued to favor agricultural commodities. Over two decades ago Jay got his start at the Kansas City Board of Trade in the Wheat Futures pit. Soybean oil remained the largest biodiesel feedstock, with 747 million lbs used in June, or about 66 percent of the total. Down from there, Coffee made a 3 wave pullback in wave 4 to correct the cycle from 7/15/2020 low ( $96.17).


A weakened US dollar helps make oil and other commodities priced in US dollar more attractive to global investors holding other currencies. As a result of this shift, Ricchiuto said tighter labor markets, higher inflation levels and a lower dollar could become the new normal in the coming years. The dollar index has come down to hit its lowest point since May 2018 in reaction to the US Federal Reserve s policy shift on inflation announced last week. MARKETS TODAY OIL: Oil prices gained, reversing overnight losses, as investors moved into risk assets and stayed away from the safe-haven U.S. dollar which hit multi-year lows.
Gold rose, following a fall in the U.S. dollar as investors bet on U.S. interest rates staying lower for longer. Gold advanced, following a fall in the dollar as investors bet on U.S. interest rates staying lower for longer. Price drop Consumer prices in the euro area fell for the first time in four years in August, according to Eurostat’s flash inflation estimate released this morning.
Most Asian stocks ended higher, while European shares trimmed early gains due to losses in British blue chips and weak euro zone inflation data. Five Things Follow Us Get the newsletter Dollar drops to two-year low, euro-area inflation turns negative, and Apple’s optimistic production schedule. The US dollar slipped below CAD1.30 for the first time early this year.


In other words, capital would move out of the stock market and in favor of Gold and especially gold stocks. The implication is gold stocks would strongly outperform Gold, which would outperform the S&P 500. The gold miners and junior gold miners broke out from 7-year resistance in recent months. A breakout in the GDX to Gold ratio suggests the potential for sustained outperformance from the gold stocks. As evidenced by GDX and the HUI, the gold stocks have not outperformed Gold consistently since the mid-2000s.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. As usual with a slump in the world’s reserve currency, the prices of useful commodities and gold are rising. Gold recently made a new all-time high and is stable around past all-time high resistance while Silver is trading at an 8-year high. Gold prices are trading up by 0.5% at Rs 51,964 per 10 grams. The bullish tone in gold is also backed by the weak performance in the Asian equities following a softer close on Wall Street overnight.


Total production was down 5% year over year as the company shut in some of its heavy oil Peace River production because of coronavirus-induced depressed oil prices. U.S. oil output rose 420,000 barrels per day in June to 10.436 million barrels a day, the U.S. Energy Information Administration said in a monthly report on Monday. Oil demand destruction, refineries running at reduced capacities, the global slowdown, and the OPEC production cuts have combined to pressurize the rates.
Source: Obsidian Energy Q2 2020 MD&A In comparison, Bonterra Energy produced 11,108 boe/d during H1, down 10.0% year over year, also because of low oil prices.
This came from a -82% decline in total production, combined with an average oil sales price (before the effect of derivatives) of $20.92 per barrel. BEFORE THE BELL Futures for Canada s main stock index advanced as oil prices rose, reversing overnight losses. Abraxas does have a considerable amount of oil hedges over the next several years with swap prices of over $50 per barrel. Granted, given the depressed oil prices since March, you should take the value of the 2P reserves calculated at the end of 2019 with a grain of salt.
In the very long run, oil production is likely to take a hit because the transition to EVs will pick up pace. The same poll forecasts a 3.6 million barrels drop in gasoline stocks, while distillate stocks decreased by 1.5 million barrels.

United States

Last week, Federal Reserve Chairman Jerome Powell said the Fed will be making a subtle shift in the approach to its 2% inflation target. Which is to say the Fed will tolerate inflation running higher than its official 2.0% target for sustained periods of time going forward. But the reality is that since the financial crisis in 2008, inflation levels have spent the majority of the time well below the Fed’s 2% target. One way is capital flight from outside the US to the perceived safety of the US Treasury market that overrides other effects on bond prices/yields.
Zoom Video Communications (ZM) shares remain unstoppable on the stock market: they closed yesterday’s session on the Nasdaq with a rise of 8.63% to $325.10. As everyone by now knows, inflation over the last several years has largely come in below the Fed’s 2% target. Will the Fed’s new approach allow it to get inflation back up to 2% on a sustained basis? Ricchiuto said his initial reaction to Powell’s comments was that it has taken the Fed a long time to recognize an important shift in the U.S. economy.
JPMorgan says investors should prepare for rising odds of Trump win.Facebook says it can block content to avoid regulatory risk. Turning to analyst estimates, it appears that Wall Street sees further upside for the share price, as the investment community has been impressed by the company’s recent performance.


But the dismal stock performances also reflect new, unwelcome attention from Beijing: China’s central bank and housing ministry last month corralled developers to discuss lofty debt levels. Beijing continues to send fighter jets around Taiwan, prompting Washington to issue an assurance that it would supply its government with enough weapons to counter a growing threat. As tensions mount between Washington and Beijing, companies in Europe increasingly risk becoming collateral damage in the crossfire of new rules and restrictions not necessarily designed for them.
The China Central Bank (PBOC) is also extremely aggressive for a currency that is only used in 4% of global transactions according to the Bank of International Settlements. The unexplained detention of an Australian citizen who worked as a TV anchor in Beijing now threatens to exacerbate ties that have been deteriorating for months. ByteDance is reconsidering its options for TikTok and weighing the implications of Beijing’s involvement in the sale of its U.S. operations, people familiar said.
Some European governments have bowed to U.S. pressure to target Beijing, even to the detriment of their own homegrown companies.
Despite denials, it was the latest example of a hardening of the country’s attitude to Beijing. Beijing denied its troops strayed into Indian territory.


Chancellor Angela Merkel, with the added authority of holding the EU’s six-month revolving presidency, has launched a German initiative to prevent escalation, reduce tensions and overcome longstanding conflicts. Chancellor Merkel’s preference for mediation, in liaison with the High Representative, could lead ultimately to bilateral negotiations between Turkey and Greece and compromises on their conflicting claims. EU foreign ministers are discussing the issue and, without de-escalation, sanctions against Turkey could be implemented.
But the different approaches taken by France and Germany could undermine the EU’s mediation effort. The 2016 joint initiative to stem illegal migration through Turkey to the EU is the most palpable example of such cooperation. The EU’s main interest in the Eastern Mediterranean is conflict prevention rather than energy security. The EU is vocal in calling for the respect of the rule-of-law in Turkey but, at the same time, needs to engage with Ankara in areas of mutual interest.
The EU has economic as well as geopolitical interests at stake in relation to energy exploration and production in the Black Sea and Eastern Mediterranean. Ms Merkel wants the union to act with its trademark soft power to reduce tensions. By now, I have built up excellent skills and experience in analyzing macroeconomic and political developments in Europe, the Eurozone and Germany, including ECB watching.