Stephen Innes
SPI Asset Management
Putting aside last night's oil spill, two key drivers should keep markets supported, Russian production declining and Chinese mobility indicators rising.
On the broader macro landscape, global data, for the most part, augers for some landing other than hard that should keep the dollar on the defensive and favourable for oil prices.
The Fed-generated deflation was the most significant driver of price downside, but with the Fed finally downshifting as inflation eases, that is a subplot positive.
But as the markets wait for factual details of those two primary solid catalysts( China + Russia), price action is likely to lag positive news but react aggressively to recession risk, any post-LNY downside in Chinese restocking demand or upside in Russian production.
Once again, investors could be shifting the burden of proof toward visibility on bullish fundamentals before being willing to deploy risk above current ranges.
We are coming off a year where investor returns were generated through carry via higher backwardation rather than through smooth trending higher spot prices. Passive investors are looking to play again, but it could be an H2 story once Fed terminal rate has passed.
SPI Asset Management provides forex, commodities, and global indices analysis, in a timely and accurate fashion on major economic trends, technical analysis, and worldwide events that impact different asset classes and investors.
Our publications are for general information purposes only. It is not investment advice or a solicitation to buy or sell securities.
Opinions are the authors — not necessarily SPI Asset Management its officers or directors. Leveraged trading is high risk and not suitable for all. Losses can exceed investments.
Recommended Content
Editors’ Picks
EUR/USD: US Dollar turns north as central banks’ decisions loom Premium
The US Dollar turned north this past week, partially losing its pace on Thursday, as speculative interest took a break ahead of the United States employment figures scheduled for Friday. On the contrary, the Euro remained on the back foot as the economic future remains uncertain.
GBP/USD remains on track to snap three-week winning streak
GBP/USD recovered toward 1.2550 after coming in within a touching distance of 1.2500 in the second half of the day after Nonfarm Payrolls came in at 199,000 for November. Despite the recent rebound, the pair remains on track to snap a three-week winning streak.
Gold bulls turn hesitant ahead of US inflation data, Fed meeting Premium
Following an impressive rally at the beginning of the week, Gold turned south and snapped a three-week winning streak. As market focus shifts to next week’s key data releases and central bank events, XAU/USD’s technical outlook points to a loss of bullish momentum.
Altcoin bull cycle 2023 picks by analyst: Ethereum, ChainLink, Arbitrum, Optimism
Crypto analyst Michaël van de Poppe picked four altcoins for the ongoing bull run, in his recent video on YouTube. The analyst believes these altcoins could outperform other assets and yield gains for traders, alongside Bitcoin price rally to $48,000.
Week Ahead – Will the central bank bonanza kill the festive joy or fuel it?
Fed, ECB, BoE and SNB hold their final policy decisions of the year. Will they push back on rate cut expectations? US CPI and flash PMIs will be crucial too. UK GDP, Aussie jobs also on the agenda.