Commodity Trade Mantra

All posts under ‘Commodity Trading’

Silver Takes the Gold Prize: Commodities Half Yearly Report 2016

Caused by worries of a summer interest rate hike and uptick in the U.S. dollar, gold and silver both stalled in May but have since rallied on the back of Brexit and with government bond yields in freefall. This has been highly constructive for gold and silver, as yields and precious metals tend to be inversely related. As for silver, some forecasters place it at between $25 and $32 an ounce by year’s end.

Bull Market in Commodities - Central Bankers to be Blessed with Inflation Soon

Commodities are now nearing bull-market territory after rebounding from the lowest level in at least 25 years. Investors have poured more than $17 billion into exchange-traded products linked to commodities since the start of the year. Sharply rising commodity prices since the beginning of the year are a warning sign that perhaps the inflationary times have begun.

Eurozone in Danger on Falling Purchasing Power of Dollar, Not Rising Commodity Prices

All financial prices in the Eurozone are badly skewed. So far, the price inflation environment has been benign, but this year, things have been changing. Higher levels of debt will never allow the ECB to run interest rates up sufficiently to kill price inflation. More likely, positive rates of only one or two per cent would be enough to destabilise the Eurozone’s financial system.

CFTC doesn't know, nor wants to know Anything about the Commodity Market Rigging

Being unaware of the Deutsche Bank market rigging story, untill 10 days later, gives the impression that the CFTC not only doesn’t know what’s going on in its jurisdiction but also that it doesn’t want to know. It is additional evidence that certain commodity market rigging is outside the commission’s concern because the governments are the actual perpetrators.

How Automated Trading / Algorithms Can Affect Commodity Trading

Automated trading accounts for more than 70% of all futures trading. Regulators have set their sights on regulating automated trading in the commodities market with controversial new rules. The increase in algorithmic trading will have a number of impacts on the market and fewer opportunities for human traders who may struggle to compete.

12 Lethal Trading Mistakes That Even the Best Traders Make

Given that markets are on a major turning point, it’s time we discuss 12 of the worst trading mistakes that even seasoned traders do. And it’s worth mentioning that I’ve been guilty of quite a few of these trading mistakes earlier. If you want to become a better trader & make money, you have to identify & rectify your biggest trading mistakes. A little self-reflection can go a long way.

Volatility Frustrates Traders: No Rational Explanations On What’s Going On

Traders are frustrated in a market where nothing makes sense. A casualty of this current volatility is that at any given time there are no rational explanations for what’s going on. Back & forth swings of meaningful proportion are characterized, by necessity, with a random reason generator. Better to just put it down to simple things like China’s economy or European banking system is collapsing.

Is The Commodity Market Trend Really Your Friend?

The commodity supercyle might be toast—but that doesn’t mean we won’t experience some wild bear market rallies. Today, you could jump on one of the great opportunities for a lightning fast hit-and-run raid on the commodities market. Commodities have found a patch of blue sky. I don’t know how long it’ll stay open, so let’s bask in the sunshine while we can.

For Commodities Forecast: Follow This Sneaky Indicator

The purchasing managers’ index (PMI) forecasts future manufacturing conditions and activity by assessing forward-looking factors. When a PMI “cross-above” occurs—that is, when the monthly reading crosses above the three-month moving average—it has historically signalled a possible uptrend in crude oil, copper and other commodities.

Commodity Crash Warns Of Imminent Deflationary Financial Crisis

Overall, the Bloomberg Commodity Index is down more than 28 percent over the past 12 months, and it has plummeted by more than half since mid-2011. The exact same patterns that we witnessed just prior to the great stock market crash of 2008 are happening once again. This includes the staggering crash of commodity prices that we are currently witnessing.

Commodities Plunge To New 16 Year Low; Oil Slides On Venezuela Warning

The Bloomberg Commodity Index is set for its worst year since the financial crisis, plunging 23 percent. It’s not just the metals though: crude oil also started the session off on the wrong foot, following this weekend’s comments from Venezuela that oil prices may drop to as low as the mid-$20s a barrel unless OPEC takes action to stabilize the market.

Get Ready for Commodity Liftoff: Global Manufacturing Just Made a HUGE Move!

We believe the real commodity liftoff should occur when the U.S., Europe, China & global PMIs all score above a 50.0, with the one-month readings above the three-month trends. Of those regions, China is the only one whose reading still trails below the 50.0 level. It’s crucial that China’s PMI move above 50.0, as the Asian giant is the top driver of global commodities demand.

Have Commodities Reached an Inflection Point?

Most commodities, including crude oil, metals and grains, are priced in U.S. dollars. They therefore share an inverse relationship. When the dollar weakens, prices tend to rise. And when it strengthens, prices fall, among other past ramifications. We might very well have reached an inflection point for commodities, which opens up investment opportunities.

Which Commodities Are Most Levered To A Chinese Crash

A key drawback of this larger and more integrated role in commodity production is that lower commodity prices are now far less stimulative for China than they would have been several years ago. Yet, lower prices in commodities, other than copper, are likely to reinforce weakness in some of the key Chinese heavy industries centered on commodity production.

After a Collapse in Commodity Prices, What Next?

It is true that commodity prices may remain under pressure for a long time to come. But for companies in the resources space from E&P firms to miners, commodity prices don’t matter – margins do. If costs of extraction come down and commodity prices do as well, a company can still earn a substantial profit.

Classic Signs of a Bottom in Commodities Seen

Eleven commodities have fallen 20% or more. And seven commodities – oil, gasoline, coffee, oats, natural gas, lumber, and sugar – have fallen at least 30% in the last year. We’re not saying all commodity prices have bottomed. Some commodity prices could continue to go lower. But we do think it’s likely commodities as a group are close to a bottom.

Did The Fed Intentionally Spark A Commodity Sell-off?

A theory: The Fed realized that QE wasn’t working, and never worked, thus another path was needed. But what alternative did they have, since rates were already ZERO? So maybe they changed course and took a strong dollar policy vs. a weak one to intentionally weaken the commodity sector and thus boost consumer spending.

Commodity Markets In Distress As Oil Rout Continues

On the whole, 62 US oil and gas companies own $235 billion of debt, and at least 10% of that is at a distressed level. JPMorgan has set aside $140 million for potential write-downs in the coming months, with other banks doing the same. Everything is looking rather ominous. While oil producers get pummelled, miners get mauled.

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