A number of market participants have begun making year end predictions about where they believe stocks will finish. The predictions have the market finishing higher, lower, a lot higher, a lot lower, and right where it is today. Basically, no one really knows how the stock market will finish 2017 because no one can accurately predict the future.
But, when we look at the past, predictions have been made which aren’t as optimistic. Based on historical data a Goldman Sachs analyst has noted that when stock valuations have been where they are today, the market returns have been in single digits or negative.
Year-to-date the S&P 500 is already up 10.5%, which again compared to historical averages is an above average return. Furthermore, history tells us that we have market pull backs of 5%, 10%, and 15% rather often; about every 3 months, 8 months, and 14 months. We have not seen a 10% or 15% pullback in 2017. Continue reading "Market May End The Year Where It Is Today, But You Can Still Make Money"
The U.S. dollar is the primary benchmark for the expense of the time value of the money around the world. It affects all asset classes, and I want to analyze it to see if the speculation about the coming cycle of the rise in interest rates is valid or not.
The wise trader once said; “if you want to know the market trend just squeeze the chart to see the perspective.” I used that advice to focus on the long-term perspective, and in this post, I would like to share the result of my research in the three graphs below.
Chart 1. The Yield Of 10-Year U.S. Treasury Notes Quarterly: Downtrend Could Be Over Soon
Chart courtesy of stooq.com
The chart above shows the history of the yield on the 10-Year U.S. Treasury notes (UST) from 1980 to present day. I chose that period to highlight the whole move down of the yield from the top in 1981 at the 15.84%. I chose this instrument as it is a benchmark showing investors’ sentiment about the future interest rates for the U.S. dollar. Continue reading "Gold And The Era Of Rising Interest Rates"
Hello traders everywhere. Stock markets around the globe are posting gains today as the tensions between the U.S. and North Korea have eased a bit. The S&P 500 and NASDAQ are both posting 1% gains with the DOW trailing closely on their heels.
Concerns over a rise in OPEC crude production has pushed oil down little over 1% to 48.13, its lowest level in slightly over two weeks. Check out Robert Boselego's recent article on OPEC's production numbers and where he sees the price of oil heading.
Gold has retreated from its Friday high of 1298.10 and is currently trading lower for the day coming under pressure from a strengthening dollar.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded near 12.4, down about 20%. The index posted its largest weekly gain since December 2015 last week as the North Korea situation escalated.
Key levels to watch this week: Continue reading "Stocks Gain As Global Tension Eases"
We've asked Michael Seery of SEERYFUTURES.COM to give our INO readers a weekly recap of the Futures market. He has been Senior Analyst for close to 15 years and has extensive knowledge of all of the commodity and option markets.
Michael frequently appears on multiple business networks including Bloomberg news, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show.
Wheat futures in the December contract settled last Friday in Chicago at 4.82 a bushel while currently trading at 4.65 down about $0.17 for the trading week reacting to a very bearish USDA crop report which was released yesterday sending prices down $0.20. Ending wheat stocks were stated at 933 million bushels, but expectations were around 901. That coupled with the excellent growing conditions pushed wheat prices to lows that we haven't seen since June 12th. There is major support around the 4.50/4.60 level as we traded in that area for several months before rallying on fears of drought in the Dakotas and the state of Montana. I have been looking at a bullish position in this market, but I will avoid the grains for now as they still look like they are headed lower in my opinion. Wheat prices are trading under their 20 and 100-day moving average telling you that the trend is to the downside as the chart structure is poor, so look at other markets with a better risk/reward scenario.
CHART STRUCTURE: POOR
Continue reading "Weekly Futures Recap With Mike Seery"
According to OPEC, global OECD oil inventories fell 22 million barrels in June to end at 3.033 billion. But that figure is 252 million barrels above its five-year average. OPEC has targeted reducing those inventories to the average level, but its own supply-demand projections imply that goal will not be met through 2018, assuming it maintains production at the July 2018 level. In fact, there will be a 45 million barrel build in 2017, and an additional 162 million barrel build in 2018, even if production does not rise after the extension ends in March 2018. This implies that oil prices will need to be below marginal production costs for some time in order to limit production growth.
OPEC reported that production rose by 173,000 b/d in July to average 32.869 million barrels per day (mmbd). OPEC’s 32.5 mmbd ceiling included Indonesia but did not in Equatorial Guinea, and so the adjusted July figure was 33.449. This implies that OPEC produced 949,000 b/d above its ceiling, a large failure, especially considering that it had been claiming to be 100% (or more) compliant with its quotas. Continue reading "Oil Market Outlook Deteriorating With OPEC's Production Rise"