Commodity Trade Mantra

Posts Tagged ‘Emerging Market Currencies’

Strength of Gold Against Foreign Currencies Confirms Bull Market Status

If Gold is going up only because of a falling US$, that is a US$ bear market, not a Gold bull market. A Gold bull market is Gold rising against the majority of currencies. Gold’s strength in foreign currencies confirms its global bull market status and provides a hint that more gains for Gold in US$ terms are likely ahead. We view any weakness in the weeks ahead as a buying opportunity.

The New Bull Market in Gold is Right on Track

Gold is very strong in real terms and has been for weeks. Gold’s recovery is now on par with past recoveries and the metal has taken out key resistance at $1180/oz. Unless Gold somehow loses its gains and closes February below $1180/oz then there is no reason to doubt a major trend change and new bull market.

Oil Price Volatility Off The Charts - What Explains The Incredible Volatility?

Oil prices are at their lowest levels in more than a decade, but the daily up & down moves are leaving investors with whip lash. What explains the volatility? What is new is the instability in the financial markets. China’s slowing growth; Emerging market currencies crashed; Fed rate hikes may or may not be forthcoming, etc. This all adds up to a period of incredible volatility.

Is This How the Next Global Financial Meltdown Will Unfold?

As emerging market currencies decline, income streams needed to service the dollar debt declines: as income & valuations fall, capital flees, pushing the relative value of the currency down even more, which further raises the risk premium which triggers even more capital flight. The sums in play are so staggering, even the Fed won’t be able to stop the financial meltdown.

Asset Price Inflation Enters Its Dangerous Late Phase

A progression of the asset price inflation disease into its final stage (general speculative bust and recession) would mean the end of monetary inflation and also inflation in goods and services markets. What could bring about this transition? Most plausibly it will be a splintering of rose-colored spectacles worn by investors. What could cause the splinter? Read here.

When A Soaring Dollar "Reflects Loss Of Investor Confidence And Is Potentially Devastating"

A strong dollar has a Jekyll and Hyde personality – a ‘good dollar’ that reflects economic & monetary policy divergence & whose rally is orderly and limited. A ‘bad dollar’ which de-couples from monetary policy & reflects instead a loss of investor in the face of higher volatility. That dollar rises faster, much further & is potentially devastating.

follow us

markets snapshot


Market Quotes are powered by Investing.com India

live commodity prices


Commodities are powered by Investing.com India

our latest tweets

follow us on facebook