Coronavirus Boost Safe-Haven Futures

Posted on by Mike Seery

Gold Futures

Gold futures in the April contract is higher by $28 at 1,648 an ounce or 1.71% after settling last Friday in New York at 1,586 up about $63 for the week higher for the 7th consecutive session while also hitting a 7-year high.

At the current time, I'm not involved. However, if you have been reading my previous blogs, I am bullish gold as I think we will crack the 1,700 level, possibly in next week's trade, as there is too much uncertainty about the coronavirus at the current time.

Presently I have bullish recommendations in platinum and silver as the whole sector looks to move higher, in my opinion. If you are long a futures contract, I would continue to place the stop loss at major support standing at 1,550 as this trend is real and very strong to the upside as I see absolutely no reason to be short gold.

Fundamentally speaking, the concern that the coronavirus is spreading outside of China undercut stock prices and boosted the safe-haven demand for precious metals. Coupled with the fact on lower Chinese interest rates in the wake of the recent move by the People's Bank of China (PBOC) to cut rates by -10 bp on various bank loans and repo operations.

TREND: HIGHER
CHART STRUCTURE: POOR
VOLATILITY: HIGH

Silver Futures

Silver futures in the March contract is trading higher for the 6th consecutive session up another $0.26 at 18.58 an ounce or 1.45% after settling last Friday in New York at 17.73 up about 83 cents for the trading week as prices are near a 5-month high.

I have been recommending a bullish position from the 18.13 level, and if you took that trade, continue to place the stop loss under the 10-day low, which now stands at 17.44 as an exit strategy. The chart structure will not improve for another four trading sessions, so you will have to accept the monetary risk at this time. Continue reading "Coronavirus Boost Safe-Haven Futures" →

Facebook Remains Compelling

Posted on by Noah Kiedrowski

Facebook (FB) tanked after announcing its recent quarterly earnings despite beating on both the top and bottom-line numbers. In addition to the strong revenue and income figures, user growth across its platform grew by a robust clip and the company authorized an additional $10 billion for its share repurchase program. The culprit was a sharp rise in spending and expenses to contend with a slew of regulatory, user and legal battles the company is waging on the privacy front. This minor sell-off provides investors with a buying opportunity in top tier large-cap company that continues to grow double digits with a long runway for further growth and monetization of its platforms.

Trillion Dollar Market Capitalization

Recently, Google (GOOGL), Microsoft (MSFT), Amazon (AMZN), and Apple (AAPL) have all crossed the psychological threshold of the $1 trillion market capitalization valuation. This is the exclusive Wall Street club of only the select few. Facebook is the next potential company to be crowned a 1 trillion-dollar company and join the prestigious Wall Street club (Figure 1). Facebook’s current market capitalization sits at $611 billion, implying a $389 billion market capitalization gap. Facebook needs to appreciate roughly 64% from these levels to joins the likes of Apple, Amazon, Google, and Microsoft.

Facebook
Figure 1 – The $1 trillion market cap landscape back in August 2019 with Facebook in close pursuit and even closer to achieving the mark

Facebook’s Unparalleled Growth

Facebook is now testing its all-time highs with a reasonable price-to-earnings multiple when compared to its tech cohort. Facebook continues to post unparalleled growth Continue reading "Facebook Remains Compelling" →

Stocks Fall As Coronavirus Cases Escalate

Posted on by The INO.com Team

We headed into Friday afternoon off the lows of the session but still down for the shortened trading week after coronavirus cases escalated, which in turn has the stock market worried about a pronounced global economic slowdown. China's National Health Commission reported more than 2,000 deaths in the mainland, with 75,00 confirmed cases. That news is a jump of 800 new cases overnight. South Korea also said 52 new cases on Thursday, making its total cases 150.

All three major indexes will end the week in negative territory with the S&P 500 losing roughly -1%, the DOW is down -1.3%, and the NASDAQ is sitting right below the -1% mark at -.98%.

Adding to the economic worries were falling existing home sales and a less than stellar IHS Markit U.S. composite purchasing managers' index (PMI) report. Continue reading "Stocks Fall As Coronavirus Cases Escalate" →

Judy Shelton And The Fed

Posted on by George Yacik

I come not to praise Judy Shelton, nor to bury her. But the blanket media and political condemnation of her as President Trump’s latest (I forget which number we’re up to) nominee for the Federal Reserve Board strikes me as having nothing to do with her actual qualifications for the job but rather a reflection on her sponsor and her failure to be “the right kind of people,” meaning someone who doesn’t subscribe to the establishment groupthink.

During the several days prior to her confirmation hearings before the Senate Banking Committee last week, and back when she was first nominated, there was a flurry of scare headlines and stories about her unfitness for the position. No less than the sanctity of the independence of the Fed and the security of the U.S. economy was in jeopardy if she was confirmed. Here’s a small sample:

  • New York Times: “As Congress Prepares to Vet Judy Shelton, Worries About the Fed’s Future Mount”
  • Washington Post: “Republicans Must Protect the Fed From A Flagrantly Unqualified Nominee”
  • Bloomberg: “Judy Shelton Would Destroy Trump’s Pro-Worker Legacy” (as if Bloomberg would acknowledge any Trump accomplishment)
  • CNN: “Trump’s Fed Pick Isn’t Just a Gold Bug – She’s Also a Crypto Bull”

The Post also provided 10 of what it says are her “most controversial quotes.”

Controversial quote number 1 was this: “I don’t see any reference to independence in the legislation that has defined the role of the Federal Reserve for the United States. It would be in keeping with its historical mandate if the Fed were to pursue a more coordinated relationship with both Congress and the president.”

Indeed, how independent can the Fed be when its members are appointed by the President and ratified by the Senate? And it funds itself by buying massive amounts of government securities. Not to mention that Congressional mandate thing. Is it unreasonable to expect an agency that has a Congressional mandate might actually have to report to Congress every so often to make sure it’s adhering to that mandate? Continue reading "Judy Shelton And The Fed" →

Is Another All-Time High Ahead For Palladium?

Posted on by Aibek Burabayev

Before we start to analyze the mighty metal, I would like to mention that the crude oil futures Buy Setup was triggered last Friday as the futures price broke above $52.25. Please mind the risk if you trade and I wish you good luck there.

Now let’s get down to the metal. Earlier this year, we pushed a new Pendulum with regular champ palladium on board. Before you bet for Pendulum winner, I tailor charts for pitted instruments and so I did for palladium using the daily time frame. The outlook was quite ambitious as the bullish target was set at $2140 while the price was hovering around the $1900 level. The majority of you chose the former winner palladium as a new winner again against the logic of the experiment and I don’t blame this choice as this precious metal hits all charts amid strong demand. That target was reached within a week after the post had been published.

I detected a promising pattern on the daily palladium chart and I would like to share it with you as it still emerges.

Palladium
Chart courtesy of tradingview.com

Palladium futures hit the all-time high at $2427 on the 23rd of January. It’s quite natural that the correction followed as traders have booked profits after the price reached another record. Continue reading "Is Another All-Time High Ahead For Palladium?" →