Does Oil Hold The Key To The Canadian Dollar

Aibek Burabayev - INO.com Contributor - Metals - Canadian Dollar


At the end of last month, I called for a substantial upcoming weakness in crude oil as the market could have finished the long-lasting consolidation after the earlier crash from 100+ levels. Indeed, oil lost almost $4 from that time and now is rebounding as markets naturally move in zigzags.

Oil-related currencies also suffer, and in this post, I would like to share with you an exciting chart setup with tremendous profit potential for one of such currency, the Canadian Dollar (CAD) also known as “Loonie” among traders.

Before that, I built a chart to demonstrate the correlation between WTI crude oil and the Canadian Dollar.

Chart 1. WTI futures Vs. Canadian dollar futures: Perfect Correlation

Canadian Dollar
Chart courtesy of tradingview.com

In the chart above the WTI futures graph is black on the right scale and the Canadian Dollar futures graph (in US$ per 1 CAD) is red on the left scale. I didn’t add any annotations on the chart as you can clearly see that the correlation is just perfect and the most important fact is that the crucial market phases like strong moves and consolidations coincide in time. The Canadian Dollar tends to overshoot WTI amid market strength, but it is quite moderate during market weakness. Continue reading "Does Oil Hold The Key To The Canadian Dollar"

Global Supply/Demand Oil Outlook

Robert Boslego - INO.com Contributor - Energies - Oil Outlook


The Energy Information Administration updated its global supply/demand oil outlook for June. It shows total OECD oil inventories rising through November, ending the year about where they were last December.

Oil Outlook

This is in contrast to the rapid decline in stocks over the second half of 2017, and that enabled oil prices to rise. If this forecast is realized, it should have a moderating impact on prices, taking away some of the risk premium embedded in futures prices.

The stock projections are based on a number of assumptions: Continue reading "Global Supply/Demand Oil Outlook"

Now Is The Time To Believe In Solar Energy

Matt Thalman - INO.com Contributor - ETFs - Solar Energy


On May 9th the California Energy Commission approved a proposal to require most new homes built after January 1st, 2020 will be required to have solar panels installed on them. The new regulations will undoubtedly be a boom for an industry that had a rough time in 2017, the first-year installations declined.

The new ruling piggy-backs on a 2013 requirement that all new homes be “solar-ready.” The solar-ready rule indicated that new homes be built with a certain amount of roof space so that a future homeowner had the option to add solar panels at a later date.

The most recent rule will no longer give homeowners or builders the option to forgo the upfront cost of solar panels, which some estimate will be high as $30,000 per home. The most persuasive arguments against the new rule are just that, the additional costs of the home. California is by most measures already in a housing crisis regarding costs; many believe this will only compound the problem.

But, that also leads to some excellent investment opportunities. The solar panel industry is going to see a massive, built-in installation base. In 2017 California saw over 53,000 single family homes built and most would agree that number needs to be higher in a state with an ever-growing population.

On a very conservative basis, that number will grow to 55,000 in 2020. It is currently estimated that only about 600,000 homes in California currently have solar panels. So, to think that number of easily more than double in a few years when all new homes are required to have solar power, it's clear the investment opportunity in solar is huge. And remember, this is just California we are talking about, other states such as Arizona and Florida, (parts of Miami already have) also could pass similar regulations.

So, how do you cash in on this opportunity? Continue reading "Now Is The Time To Believe In Solar Energy"

Don't Bet On Crises To Keep Bond Rates Lower

George Yacik - INO.com Contributor - Fed & Interest Rates - Bond Rates


Despite the recent dip in the 10-year Treasury note yield back below 3%, don’t count on it staying there. Lately, it seems, the only thing keeping the rate below that level is some sort of international crisis – Italy, North Korea, trade wars, etc. But the basic fundamentals determining that rate – economic growth and supply and demand, in other words – are calling for even higher rates, well above 3%.

On the supply side, more Treasury debt is coming to market all the time, like an incoming tide in the Pacific Ocean. On the demand side, there are fewer buyers – and I mean big buyers. More about that in a minute. At the same time, the economy is growing stronger, which by itself is going to put upward pressure on rates.

In other words, if you’re betting that the 10-year yield is going lower, or will stay around or below 3%, you’re really only holding it as a safe haven. Nothing wrong with that, lots of investors do that. But if you’re hoping to profit when something in the world goes wrong, you may be playing a losing game.

First the economy. Last week on CNBC’s Squawk Box, the gold dust twins, Warren Buffett and Jamie Dimon, tried to outdo themselves in how great the U.S. economy is performing. Continue reading "Don't Bet On Crises To Keep Bond Rates Lower"