Weekly: "The World is Short Commodities, China is Long"- JPMorgan
Weekly: "The World is Short Commodities, China is Long"- JPMorgan
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SECTIONS
Market Summary: weekly recap
Technicals: active trading levels
Podcasts: GoldFix and Bitcoin
Charts: related markets
Calendar: next week
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Precious Research and Analysis
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1. Market Summary
Friday was a microcosm of the week with headlines dominating swings as traders focused on what Powell will do, what Putin may or may not have done, what the US/NATO will do, and what chaos they will unleash next. The best outcome, we fear, is Ukraine becoming a Syria-like quagmire in which Pro Russian citizens flee east, and pro Western ones migrate west.
The Dow and Nasdaq were the week's biggest losers.
This week's weakness took the S&P, Dow, and Nasdaq down to YTD closing lows from Jan 27
Sectors
MajorTech ( FAANGMAN) did poorly again, with Amazon, which recently announced a share buyback, the important exception #1
Consumer defensives did very well #2
Energy did poorly, more poorly than the commodity itself #3
Gold stocks did very well
ROKU crashed 22% on Friday as duration stocks continue take it on the chin as observed in our Jan 8th premium report.
Commodities
see chart section for graphics
Gold rose for the 3rd straight week, over 3% - its best week since May 2021, rising back above $1900, highest since June 2021
This is the best 3-week jump in gold since Aug 2020.
Oil suffered its first weekly loss of the year with prospects of Iranian oil coming online won out over Ukrainian fears.
Crypto had another tough week as its correlation with big-tech continued to rise- see podcast section for comment on why that is growing
Bonds
The week was a roller coaster for Treasury yields as early weakness gave way to an aggressive bid in the latter half of the week. This reflected the 2 drivers in markets now. Inflation driving yields up, and Ukraine fears driving them down.
The Russia headlines sent rate-hike expectations lower for March.
Rate-hike expectations with the market now pricing in less than 6 hikes by year-end and only a 25% chance of a 50bps hike in March.
***Note: This weekend JPMorgan changed their own forecast to 9 hikes despite this. See beneath the fold***
GoldFix Friday WatchList:
Complete Watchlist Here
2. Technical Analysis
Report Excerpts Courtesy MoorAnalytics.com
GoldFix Note: Do not attempt to use price levels without symbol explanations or context. Moor sends 2 reports daily on each commodity they cover. The attached are non-actionable summaries.
Gold
TECHNICALLY BASED MARKET ANALYSIS AND ACTIONABLE TRADING SUGGESTIONS Moor Analytics produces technically based market analysis and actionable trading suggestions. These are sent to clients twice daily, pre-open and post close, and range from intra-day to multi-week trading suggestions. www.mooranalytics.com
Bitcoin
Energy
Go to MoorAnalytics.com for 2 weeks Gold, Oil, and Bitcoin reports free
3. GoldFix and Bitcoin Podcasts
Active Trading comment…
Bitcoin: The Normies are taking over…
4. Charts
Rectangles reflect behavior during Ukraine headline dominance
Dollar Index
Bond Yields
Gold
Silver
Crude Oil
Bitcoin Futures
Charts by GoldFix using TradingView.com
5. Calendar
Some upcoming key data releases and market events.
MONDAY, FEB. 21 Presidents Day holiday - None scheduled
TUESDAY, FEB. 22
9 am S&P Case-Shiller home price index (year-over-year change) Dec. -- 18.8%
9 am FHFA home price index (year-over-year change) Dec. -- 17.6%
9:45 am Markit manufacturing PMI (flash) Feb. 56.0 55.5
9:45 am Markit services PMI (flash) Feb. 52.2 51.2
10 am Consumer confidence index Feb. 109.5 113.8
WEDNESDAY, FEB. 23 None scheduled
THURSDAY, FEB. 24
8:30 am Initial jobless claims Feb. 19 234,000 248,000
8:30 am Continuing jobless claims Feb. 12 -- 1.59 million
8:30 am Gross domestic product revision (SAAR) Q4 6.9% 6.9%
8:30 am Gross domestic income (SAAR) Q4 -- 5.8%
10 am New home sales Jan. 806,000 811,000
FRIDAY, FEB. 25
8:30 am Nominal personal income Jan. -0.3% 0.3%
8:30 am Nominal consumer spending Jan. 1.5% -0.6%
8:30 am PCE inflation (monthly) Jan. -- 0.4%
8:30 am Core inflation (monthly) Jan. 0.5% 0.5%
8:30 am PCE inflation (year-over-year) Jan. -- 5.8%
8:30 am Real disposable income Jan. -- -0.2%
8:30 am Real consumer spending Jan. -- -1.0%
10 am UMich consumer sentiment (final) Feb. 61.6 61.7
10 am 5-year inflation expectations (final) Feb. -- 3.1%
10 am Pending home sales Jan. 0.8% -3.1%
Main Source: MarketWatch
Zen Moment:
Disclaimer:
Nobody is telling you to do anything here. Anybody who tells you to do something without first intimately knowing your personal situation is irresponsible at best and manipulative at worst. Anyone who acts on other people’s opinions without first doing an inventory of their own situation shouldn’t be surprised if they lose money.
6. Premium: Precious/Feature Analysis
At Bottom: The world is short commodities. China is not.- Analysis
7. Premium: Research Report
At Bottom:
Rate Hikes: We now look for the Fed to hike 25bp at each of the next nine meetings
Rate Hikes: Consumers keep spending
Inflation: is accelerating across Western Europe and EM Asia.
Oil: A de-escalation of tensions with Russia and a successful resolution of the Iran deal should push oil prices down toward our $86/bbl
Oil: confrontation has the potential to push oil to perhaps to $120/bbl