It has been a rather volatile couple of days in the financial markets. Much of the volatility has been in the stock markets where the major indices rose sharply late in the day yesterday after the EU and U.S. diffused their trade disputes, only for the optimism to be met with a heavy 20% sell-off in Facebook shares in extended hours on the back of the social network’s poorly received earnings report and forward guidance.
Imagine there are no tariffs. It’s easy if you try. No price floor below us, above us only sky. Imagine all the people trading free in peace. You may say I’m a dreamer but I’m not the only one. I hope one day the WTO will join us and the world will trade as one.
Farmers looking ahead to harvest should get hedged even though President Trump will use a Great Depression-era program to pay up to $12 billion to help U.S. farmers through the trade war talks. Maybe Willie Nelson should come play at the Trade talks with President Trump and President of the European Commission Jean-Claude Juncker. Any sign that Trump and Juncker can lay the groundwork for a trade deal could set oil, distillate, grains and metals on a tear.
Bitcoin has risen further higher today, climbing for a time above $8350 – its best level since May 21. As a result of the rally, BTC/USD has broken even more short-term resistance levels. This is an indication that the bulls are regaining control, at least in the short term. But whether or not we will see any 2007-style moves remains to be seen.
Gold bulls were offered a temporary lifeline in the form of dollar weakness on Tuesday with prices rebounding toward $1,226 per oz. as of writing. While the yellow metal has scope to venture higher in the near term if the dollar continues to soften, the medium-to-longer term outlook remains tilted to the downside.
Crude oil prices are on a wild ride. Oil prices rallied as hot rhetoric between the United States and Iran heated up. They sold off on data from Genscape that showed an 83,106 barrel increase in supply in Cushing, Okla., since Tuesday, and after reports of the return of some Libyan oil. Reports show that Waha oil production in Libya rose to 130,000 barrels a day from 100,000 barrels a day last week, as loading resumed at Es Sider port, according to Bloomberg.