26 Sep

Fears of a real estate market crisis are growing again in China. ECB, following the Fed, plans to keep rates as long as possible

By JustMarkets

At yesterday’s close of the stock market, the Dow Jones Index (US30) increased by 0.13%, while the S&P 500 Index (US500) added 0.40%. The NASDAQ Technology Index (US100) closed positive by 0.45% on Monday. The 10-year bond yield rose to 4.523%, the highest since 2007. The hawkish attitude of the Fed representatives is also yielding results. In the current environment, risk assets (euro, British pound, stock indices) are likely to remain under pressure while the US dollar will continue to rise.

Fears of a US government shutdown continue to grow as Congress has yet to pass any spending bills needed to fund the government beyond October 1. Rating agency Moody’s said that while a US government shutdown would negatively impact the country’s creditworthiness, the economic impact would be short-term.

Amazon.com Inc (AMZN) said it will invest up to $4 billion in Anthropic, a company that develops generative artificial intelligence technologies, including chatbots based on large language models, such as ChatGPT, for Amazon Web Services customers. Alphabet Inc Class A (GOOGL) also owns about 10% of Anthropic after investing $300 million earlier this year.

Equity markets in Europe were mostly down on Monday. Germany’s DAX (DE40) decreased by 0.98%, France’s CAC 40 (FR40) fell by 0.85% yesterday, Spain’s IBEX 35 (ES35) lost 1.22%, and the UK’s FTSE 100 (UK100) closed down by 0.78%.

Germany’s IFO business climate index for September fell by 0.1 to 85.7, the lowest level in five months. According to analysts, Europe’s leading economy is at risk of a second recession in a year.

ECB spokesman Villeroy made several statements yesterday:

  • The ECB has growing confidence in achieving the 2% target by 2025;
  • The ECB should focus on persistence rather than raising rates;
  • There is also a risk of easing monetary policy too early.

So, the ECB is following in the steps of the US Fed and plans to keep rates high as long as possible. But if economic data starts to deteriorate sharply, policymakers are prepared to consider cutting rates if necessary.

The rally in the dollar index, which reached a 6-month high on Monday, depressed energy prices. And gasoline prices fell to a 3-week low. Crude oil prices were also falling due to concerns that the worsening debt crisis in China will worsen the Chinese economy and energy demand. However, oil price losses were limited by expectations that global oil supplies would remain tight.

Asian markets traded flat on Monday. Japan’s Nikkei 225 (JP225) added 0.85% for the day, China’s FTSE China A50 (CHA50) decreased by 0.67%, Hong Kong’s Hang Seng (HK50) lost 1.82%, and Australia’s ASX 200 (AU200) was positive 0.11% on Monday.

Economists have growing fears that a worsening real estate crisis in China will undermine the country’s economy. On Sunday, China Evergrande Group canceled a meeting with creditors and said it should review its restructuring plan. In addition, China Oceanwide Holdings Ltd. said it faces liquidation after a Bermuda court ordered the company into liquidation for defaulting on a $175 million loan principal payment. There are also growing fears that China Country Garden Holdings may default after breaching initial interest payment deadlines on dollar bonds.

The Japanese government the other day promised to issue a new economic package to “ease the pain of inflation,” which, paradoxically, is still “below target levels,” according to the Bank of Japan. The package will include measures to protect the Japanese from cost inflation (energy and product subsidies), support for wage and income growth (wages and salaries are also costs and demand inflation), support for investment to stimulate growth, measures to counter population decline, and encourage infrastructure investment.

S&P 500 (F)(US500) 4,337.51 +17.45 (+0.40%)

Dow Jones (US30) 34,007.21 +43.37 (+0.13%)

DAX (DE40)  15,405.49 −151.80 (−0.98%)

FTSE 100 (UK100) 7,623.99 −59.92 (−0.78%)

USD Index  105.96 +0.37 (+0.35%)

News feed for 2023.09.25:
  • – US FOMC Member Kashkari Speaks at 01:00 (GMT+3);
  • – US CB Consumer Confidence (m/m) at 17:00 (GMT+3);
  • – US New Home Sales (m/m) at 17:00 (GMT+3);
  • – US FOMC Member Bowman Speaks at 20:30 (GMT+3).

By JustMarkets

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Economics & Fundamentals Financial News
26 Sep

Oil bulls: Not done yet?

By ForexTime

  • Crude oil now pulling back from year-to-date high
  • $90 psychological region tested for support now
  • Daily close below 21-day EMA may invite more declines
  • Elliot Wave theory suggests more eventual room for gains

 

Oil bulls (those hoping prices will move higher) may just be taking a breather for the moment.

Prices of US crude have pulled back since reaching the year-to-date high at $93.59 on September 19th, but this may be short-lived.

The decline from this swing high was likely due to a couple of factors:

  •  a bounce off the upward rising channel’s resistance which has been tested three times since the rally starting from June 7th, 2023.
  • a technical pullback, after its 14-day relative strength has been in “overbought” territory (above the 70 threshold) for the two weeks prior

Notably, Crude is now testing the psychologically-important $90/bbl level for immediate support.

The 23.6 Fibonacci retracement level also sits close by, at $89.92, to potentially lend stronger support.

 

Potential support ahead

Crude oil prices are currently still above, albeit declining, towards it’s 21-day EMA.

A continued decline could see bears take advantage of this reversion to its mean to potentially test the following key support levels:

  • $88.31: 21-Day EMA
  • $87.65:38.2 Fib ratio
  • $85.81: bottom upward ascending channel trendline, also the 50 Fib ratio line

The Fibonacci retracement tool is applied to the daily time frame from 24th August’ low at $78.04 to the year- to- dates high.

More upside for Crude? Elliot Wave theory says “yes”

Taking Elliot wave count into consideration, crude oil has yet to complete the 3rd impulse move from wave 2’s termination at the $78.04 lows.

This suggests that Crude prices must reach at least $95.81, or potentially even break above the psychologically-important $100/bbl line, before the 3rd impulse move is deemed “complete.

In short, adhering to the Elliot Wave theory, this suggests there should be more near-term gains ahead for Crude oil.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Energy Financial News
26 Sep

RoboMarkets Integrates with TradingView to Enhance Trading Opportunities

RoboMarkets, a European broker company, announces its integration with TradingView, a leading platform for charts and analysis. RoboMarkets clients can now implement their trading strategies on TradingView and analyse their performance with a wide range of charting and analysis tools.

Through this integration, RoboMarkets products are made available to a broader audience, including investors who rely on cutting-edge analytics tools to identify opportunities when opening new positions. The goal of this partnership is to provide a seamless and superior trading experience. RoboMarkets clients can now simply connect their accounts to TradingView and trade direclty on the platform, eliminating the need to switch between terminals. Users who do not have an active trading account can open one and instantly link it to TradingView through a user-friendly interface.

TradingView is a platform for charting and trading, enabling users to conduct technical and fundamental analysis with user-friendly tools, while also communicating with each other through the largest social network for investors. Thanks to the integration with TradingView, RoboMarkets clients can now access various advanced analysis tools, including charting tools, market data and technical indicators. Furthermore, they can explore new strategies tested by millions of active traders in TradingView’s fast-growing global community.

About RoboMarkets

RoboMarkets is a financial broker company operating under CySEC license № 191/13. RoboMarkets offers investment services in many European countries and provides traders working in financial markets with access to its proprietary platforms. Visit www.robomarkets.com to learn more about the company’s products and business.

About Tradingview

TradingView is the world’s leading charting platform and a vibrant community used by over 50 million traders around the globe. TradingView empowers its users with best-in-class charting tools, live market data, a comprehensive analytical suite, and trading integrations with selected partners.

It is a unique space where market enthusiasts can chart, chat and trade in one place. Whether you are a crypto advocate interested in btc usd, a forex trader following the dxy index, or a value investor looking for hidden gems with a stock screener — TradingView stores perks and benefits for everyone.

Beyond premier user experience, TradingView provides solutions for businesses, including advertising, news partnerships, market widgets, charting libraries, and broker integrations.

“Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69.88% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.”

Financial News Forex and Currency News
25 Sep

Yen’s Downward Trajectory Continues as Market Anticipates BOJ’s Move

By RoboForex Analytical Department

The USD/JPY pair is drawing nearer to the closely watched 150.00 level, currently experiencing most of its activity around 148.40, as of Monday. The market remains in anticipation of potential financial interventions from the Bank of Japan (BOJ). The BOJ has maintained its ultra-accommodative monetary policy, leaving the yen lingering near ten-month lows.

Last Friday, the BOJ opted to sustain the negative interest rate at -0.10% per annum. The Governor of the central bank highlighted the necessity for additional time to scrutinize the economy and assess the data. For currency market participants and those observing the yen exchange rate, the key concern is not the rate decision per se, but the absence of indications regarding any alterations in the monetary policy framework.

USD/JPY currency pair technical analysis

The H4 chart illustrates that USD/JPY has reached the projected target of a growth wave at 148.44 and underwent a correction to 147.33. The market has finalized a growth structure to 148.47 and is currently forming a consolidation range beneath this level. An upward breakout is anticipated, with the price potentially advancing to 149.42. Upon reaching this level, a correction to 148.44 may occur, followed by a rise to 150.50. The MACD oscillator substantiates this scenario, with its signal line positioned above zero and pointing strictly upwards.

On the H1 chart, a consolidation range has emerged around 148.33. The market is currently on an upward trajectory, aiming for 148.70, with the potential to extend to 149.90. The Stochastic oscillator confirms this scenario, as its signal line, having rebounded from 50, is directed strictly upwards.

The yen continues its descent, with market participants keenly observing any signs of change in the BOJ’s monetary policy framework. Technical analysis suggests potential further growth for USD/JPY, but traders will closely watch for developments and adjust their positions accordingly.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News
25 Sep

Trade Of The Week: Is the USDJPY a ticking timebomb?

By ForexTime 

The USDJPY has kicked off the new trading week by touching its highest level since November 2022.

Yen bears are clearly in power, with the Japanese yen currently the worst performing G10 currency year-to-date, shedding roughly 11.8% against the dollar.

Last Friday, the Bank of Japan (BoJ) left its ultra-loose monetary policy unchanged and kept its dovish stance despite high inflation. While the policy divergence between the Fed and BoJ remains a key driving force behind the USDJPY’s upside, the threat of government intervention could frighten bulls down the road.

Taking a trip down memory lane, the BoJ intervened back in September 2022 when the yen weakened to 145.90. Two more interventions followed in October after the Yen fell below 150.

Given how the currency is weaker than last year when Japan acted, investors remain on high alert with much chatter around 150 acting as a key level that could trigger government intervention.

It is worth keeping in mind that a weakening Yen results in higher import prices. This is transferred to producers, boosting expectations for higher inflation with consumers feeling the pain. Such a development could be a headache for policymakers, especially when factoring in how Japan’s headline and core inflation remain above the BOJ’s 2% target.

With all the above said, the threat of government intervention has made the USDJPY a ticking timebomb that could explode at any moment…

Here are 3 factors that could impact the currency pair this week:

  1. Fed speeches + US August PCE report

A host of Fed officials, including Fed Chair Jerome Powell will be under the spotlight this week.

Last week’s FOMC meeting concluded with Powell indicating that rates will remain “higher for longer”. Should policymakers strike a hawkish tone and reinforce last week’s messaging, the USDJPY could push higher as expectations rise around the Fed hiking rates once more hike in 2023.

Regarding the August PCE report, markets expect the August PCE report to show headline prices accelerated 0.5% month-over-month after July’s 0.2% increase while the core PCE deflator is forecast to rise 0.2%, same as July. The core personal consumption expenditures price index for projected to rise 3.9% year-over-year in August, down from the 4.2% seen in July.

Ultimately, more signs of cooling inflationary pressures may counteract the argument around the Fed “keeping rates higher for longer”, weakening the USDJPY as a result.

  1. Japan data dump

Investors will be dished out some key economic reports from Japan on Friday.

All eyes will be on the Tokyo inflation data for September, jobless rate, industrial production, and retail sales figures for August which could provide insight into the health of Japan’s economy.

  • Should the overall economic data from Japan print above market expectations, this may boost sentiment towards the Japanese economy – pulling the USDJPY lower as the yen strengthens.
  • If overall economic data disappoints, sentiment toward the Japanese economy could take a hit – pushing the USDJPY higher as the yen weakens.

  1. Technical forces

The USDJPY is firmly bullish on the daily timeframe as there have been consistently higher highs and higher lows. However, prices are slowly approaching overbought conditions while bulls displaying slight hesitation due to key fundamental forces.

  • The current upside could take prices towards the 150.00 psychological level. Beyond this point, the next key level of interest is the 2022 high at 151.94.
  • Should bulls get cold amid intervention fears, prices could slip back below 147.50, 146.70, and 144.90, respectively.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
25 Sep

Amazon’s AI move – why you need AI investments as race speeds up

By George Prior

Amazon’s $4bn investment into a ChatGPT rival reinforces why almost all investors should have some artificial intelligence (AI) exposure in their investment mix, says the CEO of one of the world’s largest independent financial advisory, asset management and fintech organizations.

The comments from Nigel Green of deVere Group comes as e-commerce giant Amazon said on Monday it will invest $4 billion in Anthropic and take a minority ownership position.  Anthropic was founded by former OpenAI (the company behind ChatGPT) executives, and recently debuted its new AI chatbot named Claude 2.

He says: “This move highlights how the big tech titan is stepping up its rivalry with other giants Microsoft, Google and Nvidia in the AI space.

“The AI Race is on, with the big tech firms racing to lead in the development, deployment, and utilisation of artificial intelligence technologies.

“AI is going to reshape whole industries and fuel innovation – and this makes it crucial for investors to pay attention and why almost all investors need exposure to AI investments in their portfolios.”

While it seems that the AI hype is everywhere now, we are still very early in the AI era.  Investors, says the deVere CEO, should act now to have the ‘early advantage’.

“Getting in early allows investors to establish a competitive advantage over latecomers. They can secure favourable entry points and lower purchase prices, maximizing their potential profits.

“This tech has the potential to disrupt existing industries or create entirely new ones. Early investors are likely to benefit from the exponential growth that often accompanies the adoption of such technologies. As these innovations gain traction, their valuations could skyrocket, resulting in significant returns on investment,” he notes.

While AI is The Big Story currently, investors should, as always, remain diversified across asset classes, sectors and regions in order to maximise returns per unit of risk (volatility) incurred.

Diversification remains investors’ best tool for long-term financial success. As a strategy it has been proven to reduce risk, smooth-out volatility, exploit differing market conditions, maximise long-term returns and protect against unforeseen external events.

Of the latest Amazon investment, Nigel Green concludes: “AI is not just another technology trend; it is a game-changer. Investors need to pay attention and include it as part of their mix.”

About:

deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.  It has a network of offices across the world, over 80,000 clients and $12bn under advisement.

Opinions Programming
25 Sep

FOMC representatives maintain “hawkish” positions. Inflationary pressures are easing in Singapore

By JustMarkets

At the close of the stock market on Friday, the Dow Jones Index (US30) decreased by 0.31% (-1.87% for the week), and the S&P 500 Index (US500) was down by 0.23% (-2.81% for the week). The NASDAQ Technology Index (US100) closed negative by 0.09% (-3.35% for the week). On Friday, hawkish comments from several FOMC policymakers supported the dollar, which was a negative factor for stock indices. In addition, a bullish factor for the dollar was the US manufacturing PMI data released on Friday. The US manufacturing PMI for September rose by 1.0 to 48.9, exceeding expectations of 48.2.

San Francisco Fed Chairwoman Daley said Friday she was not ready to declare victory in the fight against inflation and said inflation is unlikely to reach the Fed’s 2% target in 2024. Kansas Fed Chair Michelle Bowman said the same thing, only in different words, “I continue to expect that further rate increases are likely to be needed to return inflation to 2% in a timely manner.” FRB Boston President Collins said, “I expect that rates may need to be raised longer than previously thought, and further tightening is certainly not out of the question.”

According to EPFR Global, outflows from global equity funds totaled $16.9 billion for the week ended September 20, the highest in 9 months. Bank of America said investors are fleeing equities due to the prospect of higher interest rates for an extended period of time.

Equity markets in Europe were mostly down on Friday. Germany’s DAX (DE40) was down by 0.09% (week-to-date -1.90%), France’s CAC 40 (FR 40) fell by 0.40% (week-to-date -2.29%) on Friday, Spain’s IBEX 35 (ES35) was down by 0.49% (week-to-date -0.30%), and the UK’s FTSE 100 (UK100) closed up by 0.07% (week-to-date -0.36%).

The EUR/USD pair has continued its steady decline since mid-July. This trend was primarily due to the contrasting economic performance of the US and Eurozone, as well as differences in the monetary policies pursued by the central banks of these countries. In recent days, these differences have pushed US Treasury yields to multi-year highs across all maturities. The Fed’s benchmark rate currently stands at 5.50%, well ahead of the European Central Bank’s 4.5% rate. This gap could widen further in the coming months as US borrowing costs could rise another 25 basis points in 2023, while the ECB has signaled that its policy tightening campaign is over.

UK private companies are cutting the number of workers at the fastest pace since the pandemic and deep financial crisis, confirming the Bank of England’s decision to pause interest rate hikes for the first time in nearly two years. S&P Global’s composite purchasing managers’ index fell to 46.8 in September from 48.6 a month earlier, the sharpest decline in output since January 2021, when the UK was in lockdown. The reading was worse than economists had expected and sent the private sector deeper into contraction.

Precious metals prices closed moderately higher on Friday, with silver posting a two-week-high. A decline in T-note yields on Friday provided support for precious metals. Silver was also supported by a stronger-than-expected US manufacturing PMI report from S&P, which was positive for industrial metals demand.

Asian markets were mostly down last week. Japan’s Nikkei 225 (JP225) fell by 3.07% for the week, China’s FTSE China A50 (CHA50) gained 0.54%, Hong Kong’s Hang Seng (HK50) ended the week down by 0.06%, and Australia’s ASX 200 (AU200) ended the week negative 2.89%.

Singapore’s Consumer Price Index fell to 3.4% from 3.8%, better than the expected 3.5%. Core inflation (excluding food and energy prices) fell from 4.1% to 4.0%, which was in line with forecasts. With inflation slowing and GDP growth having a weak outlook, economists generally expect the Central Bank of Singapore (MAS) to leave monetary policy settings unchanged during its scheduled meeting next month.

S&P 500 (F)(US500) 4,320.06 −9.94 (−0.23%)

Dow Jones (US30) 33,963.84 −106.58 (−0.31%)

DAX (DE40)  15,557.29 −14.57 (−0.094%)

FTSE 100 (UK100) 7,683.91 +5.29 (+0.07%)

USD Index  105.58 +0.22 (+0.21%)

News feed for 2023.09.25:
  • – Singapore Consumer Price Index (m/m) at 08:00 (GMT+3);
  • – Eurozone German IFO Business Climate (m/m) at 11:00 (GMT+3);
  • – Eurozone ECB President Lagarde Speaks at 16:00 (GMT+3).

By JustMarkets

 

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Economics & Fundamentals Financial News
22 Sep

The Federal Reserve held off hiking interest rates – it may still be too early to start popping the corks

By D. Brian Blank, Mississippi State University 

Federal Reserve officials held interest rates steady at their monthly policy meeting on Sept. 20, 2023 – only the second time they have done so since embarking on a rate-raising campaign a year and a half ago. But it is what they hinted at rather than what they did that caught many economists’ attention: Fed officials indicated that they don’t expect rates to end 2023 higher than they predicted in June – when they last issued their projections.

Since the hiking cycle began, observers have worried about whether increased rates could push the U.S. economy into a downturn. Some have even speculated that a recession had already begun. However, the economy has been more resilient than many expected, and now many economists are wondering whether the seemingly impossible soft landing – that is, a slowdown that avoids crashing the economy – has become a reality.

As a finance professor, I think it’s premature to start celebrating. Inflation is still almost double the Federal Reserve’s target of 2%, and it is expected to come in at around 4% for September. What’s more, the economy is still growing quite fast, with consensus forecasts showing gross domestic product will rise by nearly 3% this quarter. Some early data suggests that could be a low estimate.

What’s next for interest rates?

Fed watchers are parsing every word from the central bank to determine whether another hike is coming this year or next, or if the cycle is truly over. To understand that decision, it helps to consider the bigger picture.

While the U.S. economy has certainly avoided a downturn for longer than many expected, the inflation battle is a long way from finished. In fact, this wouldn’t be the first time the economy looked like it would avoid a soft landing. For the next several months, the economy is not likely to implode without a major spark.

However, inflation may not continue to fall as quickly in the coming year, which means the Fed may still raise rates more than some expect. If rising oil prices continue to boost transportation costs, other goods could also get more expensive, which may mean higher interest rates for longer.

Is this really the end?

Though Federal Reserve Chair Jerome Powell seemed to indicate that the committee is approaching the end of the hiking cycle, only 10% of economists expect that it is over at this point – not that economists’ track record of forecasting rates is great either. This is largely because Powell has been clear that the Fed is basing its decisions on economic data, which has been strong so far and hopefully will continue in that direction.

So while everyone is watching the Fed this week, they should also keep an eye on broader economic conditions. With luck, the reported data will continue to be strong enough to avoid a downturn, but not so strong that inflation picks back up.The Conversation

About the Author:

D. Brian Blank, Assistant Professor of Finance, Mississippi State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 

Economics & Fundamentals Opinions
22 Sep

Copper Is About To Soar

Source: Michael Ballanger  (9/21/23)

Michael Ballanger of GGM Advisory Inc. explains why he believes copper is about to soar, as well as lithium and uranium, and shares some stocks he believes should be on your radar.

To repeat a theme that I will maintain for most of the next seven years (the decade), three components of the electrification movement will need to grow exponentially in order to meet the demand associated with this transition: More clean energy (nuclear); more transmission infrastructure (copper), and increased electrical storage capacity (lithium).

The lithium sector has been the savior of resource brokers and fund managers for most of the past three years. Using the chart of hard rock miner Patriot Battery Metals Inc. (PMET:CA), it appears as though the summer correction that hammered the bulk of the lithium miners has ended. I cannot tell whether it is going to last for very long, but short term, the runway looks clear.

The lithium “briners,” which have been a completely different story this summer, had a much-needed correction last week as the lead “briner,” E3 Lithium Ltd. (ETL:TSXV;EEMMF:US) lost a third of its value in three trading sessions after peaking at a CA$400m market cap at $5.72.

That dragged my top pick for 2023, Volt Lithium Corp. (VLT:TSV;VLTLF:US), down as well from a recovery high at CA$.395 to close out the week at $0.315.

Despite the setback, the “briners” will achieve free cash flow objectives a lot sooner than will the “miners,” but with all of the automotive money flooding into “miner projects,” I cannot see any of the lithium space players being left out of the demand-led rally that should last until at least 2030. I am inclined to invest heavily in the ones with the lowest current market cap, where management has demonstrated the ability to execute. The market caps of the three mentioned here are:

  • Patriot Battery Metals: CA$1.3 billion
  • E3 Lithium Ltd. CA$274 million
  • Volt Lithium Corp. CA$31 million

Uranium prices tapped US$62/pound this week, which sent most of the companies friendly to nuclear power on a tear. The Sprott Uranium Miners ETF (URNM::NYSE ARCA) is now up over 40% YTD, versus the NASDAQ up 30% and the S&P up 16%.

Cameco Corp. (CCO:TSX; CCJ:NYSE), the world’s biggest uranium miner, is up 77% YTD, while my personal holding Western Uranium & Vanadium Corp. (WUC:CSE; WSTRF:OTCQX) closed at $1.62, ahead 37% YTD and still well below the peaks in 2018 (CAD $3.40) and 2021 ($4.25).

With lithium and uranium now solidly ahead for the year, one has to wonder when the last component of the “electrification trilogy” — copper — will catch the attention of the big multinational trading houses.

With most of the large copper deposits around the globe now on descending production slopes and with few new discoveries coming onstream, even finite copper demand over the balance of the decade will be enough to affect price in a huge way. However, copper demand is not going to be “finite.” it is going through the roof, and that is with or without China.

The copper bears cite “weak China growth” as a reason for anemic copper prices, but one thing is certain: if you fire up fifty-seven new nuclear reactors around the world, creating several hundred million new megawatts of electricity, you are going to need a much larger transmission infrastructure which means wires and unless they find a way to transmit current more efficiently using a substance other than copper wiring, then copper is going to move into “shortage” at some point and when that point arrives, prices will explode.

The Copper Miners ETF (COPX:US) has come a long way off the COVID-19 CRASH lows, but tops in the US$42-43 range have not been revisited because of the waffling copper price. If I own uranium and lithium stocks, which I do because I am a fervent believer in the electrification movement, then I cannot construct a portfolio without copper.

Now, copper is seen by many as a boring, unexciting sector with very few junior copper deals commanding much (if any) attention. It may be that copper mining is seen as environmentally hostile to the spirit and soul of the electrification movement and thus shunned by the “woke” community of newbie investors.

I would answer that by pointing to the Energy ETF (XLE:US), up over 27% YTD with many of the components carrying P/E’s of around 8. As socially and politically “uncool” as oil and gas extraction is, money has found the sector, and investors are being rewarded. I think the same result holds true for copper, so outside of owning a few call options on the COPX:US, I am actively seeking out a cheap junior with an advanced exploration or development project that I can get behind before the rest of the world wakes up.

Lithium has soared; uranium is now soaring; the last of the electrification trilogy is about to soar.

BUY COPPER.

 

Important Disclosures:

  1. Volt Lithium Corp. has a consulting relationship with an affiliate of Streetwise Reports, and pays a monthly consulting fee between US$8,000 and US$20,000.
  2. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Volt Lithium Corp. and Western Uranium & Vanadium Corp.
  3. Michael Ballanger: I, or members of my immediate household or family, own securities of: All. My company has a financial relationship with: Volt Lithium Corp. I determined which companies would be included in this article based on my research and understanding of the sector.
  4. Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
  5.  This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

Michael Ballanger Disclosures

This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

Financial News Metals
22 Sep

The cryptocurrency market digest (BTC, ARK). Overview for 22.09.2023

By RoboForex.com

The BTC exchange rate could not support the growing momentum and slid back to 26,654 USD.

Once again, the same scenario is developing in the digital asset market. The price of the flagship cryptocurrency gradually drops, and the market starts buying vigorously. The value rises by 4-5%, and then just as quickly falls back down within two days.

This will continue until the market has a clear buying driver.

Such a catalyst could be the news about the approval by the US Securities and Exchange Commission (SEC) of applications for bitcoin-ETF licencing. But the information on this matter will only be available in mid-October.

The marks of support levels are relevant again. These include 25,500 USD and 25,150 USD, with resistance at 27,800 USD. Another growth attempt to break through resistance has failed.

The cryptocurrency market capitalisation has dropped to 1.06 trillion USD. The BTC share is still at 49.2%, while the share of ETH has declined to 18.2%.

The value of ARK has fallen sharply

The price of one of the most discussed tokens on the market, ARK, has dropped markedly, with the quotes losing 20% in 24 hours. The capitalisation of the coin decreased to 100 million USD.

Polygon introduces Pokémon NFTs

Polygon blockchain has launched NTF cards featuring legendary anime Pokémon, and they sold out at once. The original cost of these cards increased ten times, with 175 cards being sold within seconds.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Cryptocurrencies Financial News
← Previous Page
Next Page →