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2022-07-13 13:51:11 During this time, the short-term, most violent bullish momentum has been reversed. At the same time, the speed of the fall is only gaining momentum. In July, two more than 10% declines have already occurred within 24 hours.

It looks like we only see the start of a decline in oil. Geopolitics, rapid demand after lockdowns and underinvestment in production have made the rally in oil sharper than in many other commodities. But now, we see consumption growth stagnating or even going down in some cases. Meanwhile, the leading producers (US, Saudi Arabia) are ramping up and promising to ramp up production soon.

All this leads us to believe that the commodity super-cycle did not take place and turned out to be sharp, but not for long. And the road ahead for oil is downhill. The closest meaningful stop on that downward path for energy prices looks to be $83 for WTI and $85 for Brent. Open / Comment

2022-07-13 13:50:58 The Crude Oil price peak is behind us

Oil lost more than 10% in just over 24 hours, starting to decline late in the day on Monday. WTI crude fell to $91.30 as it sold off. Having lied on the way down stop orders, oil at one point fell below the 200-day moving average.

Oil has not traded consistently below this level since November 2020, throughout the last bull market. Notably, Biden’s election victory was the start of a rally across a wide range of risk assets from the Nasdaq100 and crypto to oil and other commodities. However, equities and cryptocurrencies have already zeroed in on that rise, while black gold is now around 150% more expensive than it was at the start of the active upcycle.

However, we remain of the opinion that the tide in oil has already turned. Since June 9, i.e. for more than a month, we have seen a downtrend in oil prices with a succession of lower local lows and higher highs. Open / Comment

2022-06-24 10:14:56 Famous investor Mark Mobius called bitcoin a leading indicator of stock market sentiment. In his view, now is the time to buy stocks as bitcoin investors are still talking about buying it on the downside.

China’s Economic Daily warned local investors that in the future, when market confidence collapses or when sovereign countries declare BTC illegal, it will return to its original value, which is zero.

Changpeng Zhao, CEO of cryptocurrency exchange Binance, believes that after the current collapse, bitcoin may not surpass its previous high of $69,000 until 2024. Crypto winter could last until the next bitcoin halving in 2024, the “Dvision Network” believes.

According to KPMG, institutional investors show significant interest in asset tokenisation, NFTs and meta-currencies. Citibank and Switzerland-based METACO are launching a storage service for cryptocurrencies amid the growing digitalisation of traditional investment assets. Open / Comment

2022-06-24 10:14:00 tcoin’s performance points to a weak risk appetite
Bitcoin rose 2.9% in the past 24 hours to $20.9K. Ethereum added 5.5% to $1140, while the top 10 altcoins growth ranged from 1.1% (Doge) to 11.5% (XRP).

Total crypto market capitalisation, according to CoinMarketCap, rose 3.1% to $929bn over 24 hours. Bitcoin’s dominance index lost 0.2 points to 42.9%. The cryptocurrency fear and greed index remained at 11 points (“extreme fear”) for the third day.

Bitcoin rebounded from the previous day’s decline on Thursday amid rising US stock indices. The first cryptocurrency has not yet managed to advance above $21K. Markets must guess whether we see crypto market weakness compared to equities or whether BTC works as a leading indicator, indicating that the rebound in equities is false. Open / Comment

2022-06-23 17:13:24 Record US Current Account deficit hitting the dollar
The US Current Account deficit hit a new record of $291.4bn in the first quarter. America is benefiting from higher oil prices, which helped exports rise by $13.9bn to $487.4bn. But the gain in imports was more than five times higher at $71.1bn to $829.7bn, driven by an overall increase in industrial supplies and materials.

Rapid expansion in domestic demand underscores the strength of economic growth and is another factor in favour of the Fed’s further monetary policy tightening to prevent overheating.

But at the same time, the extreme expansion of the current account deficit is playing against the USD. Despite the high USD exchange rate against a trade-weighted basket of major currencies, capital flows out of the USA.

The Fed may need to take further aggressive steps to tighten monetary policy to attract capital into the country with higher yields at the expense of economic growth. Open / Comment

2022-06-23 12:36:27 AUDUSD is trading at 0.6880 for the third time in the last two months. A move lower would take the Aussie back to where it last changed hands in July 2020, and it is not helped by expectations that the Reserve Bank of Australia will hike the 50-point rate twice, in July and August.

Recent dynamics in various markets indicate that the reduced demand for risky assets comes from a broad front. Some markets are close to their red lines, which could accelerate the sell-off and return volatility to levels of the previous couple of weeks.


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2022-06-23 12:36:06 The German DAX40 is again testing the support at 13,000 as the bounce on Friday and Monday proved unsustainable. The FTSE100, meanwhile, is back near the 7000 level, also returning to significant technical and psychological support. The US index futures also showed a loss of recovery momentum on Thursday.
At the same time, the currency market is showing a pull into defensive instruments. USDJPY pulled back to 135.35 after touching 136.70 earlier in the week. That said, the dollar is doing better than most developed country competitors today.

The euro is trading below $1.05 again after a failed attempt to bounce above $1.06 during Wednesday’s trading. Once again, the bears took the upper hand on EURUSD’s approach to the 50-day moving average. Open / Comment

2022-06-23 12:35:29 Markets fell back to key support levels, looking for new lows

The stock market failed to remain positive for the day, closing Wednesday with a slight decline. Stocks, commodities, and currencies dynamics since the start of the day on Thursday indicate the potential for further downside.

Investors are getting more signs of economic contraction, which increases the chance of a recession in the coming months. Among the commodities, we note a spike in cotton and a fall in copper.

Copper, sensitive to production cycles, has lost 15% in the last two and a half weeks, falling back to its lowest level since February 2021. Cotton, which has a tight correlation with consumer activity cycles, is trading down about 30% from its peak in early May, 22% of which has been down from early June. The fall accelerated two days ago when the price dipped below its 200-day moving average, underscoring the serious intentions of the sellers. Open / Comment

2022-06-23 10:20:58 The tug of war in #Bitcoin near the psychologically important $20K continues.

Ian Harnett, a co-founder of Absolute Strategy Research, has suggested that bitcoin will collapse to $13K this year, a 80% drop from the historic highs.

Arcane Research noted that in 2013 and 2017, BTC fell 85% and 84%. If history repeats, bitcoin’s downside potential persists to the $10,350 mark.

However, we note that in previous bullish cycles, the strengthening of BTCUSD has been many times stronger. For example, in 2013, it was more than 90 times. In 2017, it was 20 times, while in a year-long growth cycle through the highs of 2021, we saw “only” a tenfold increase.

In our view, it is much more reliable to estimate that Bitcoin finds a long-term bottom near the highs of the previous 4-year cycle, where we are already.

But still, it may not be the best time to buy, as it may take time before the crypto digests the recent turmoil and enters a phase of sustained investors' demand, not just stressed asset hunters. Open / Comment

2022-06-23 08:32:59 #WaveAnalysis

#NZDCAD reversed from resistance level 0.8280
• Likely to fall to support level 0.8065

NZDCAD currency pair earlier reversed down from the key resistance level 0.8280 – standing close to the 61.8% Fibonacci correction of the downward impulse from May.

The downward reversal from the resistance level 0.8280 started the active short-term downward impulse wave (iii).

Given the clear daily downtrend, NZDCAD can be expected to fall further toward the next support level 0.8065 (which has been reversing the pair from May).

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