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The Commodity Supercycle: It’s Not Over Just Yet

Posted on 19 November 2014 by VRS  |  Email |Print

As surprising as it might sound today, we believe the secular trend for commodities has higher elevations to travel, before eventually running its course - perhaps stretching as far as early into the next decade.
While in 2011 we became adamant that the thesis trade in commodities—specifically in its leading sector of precious metals—had become crowded and overhyped, those excesses have been wrung out of the markets over the past three and a half years and offer what we perceive to be extremely compelling long-term valuations going forward……………………………………Full Article: Source

Elliott Wave analyst sees big gold and silver price surge ahead

Posted on 19 November 2014 by VRS  |  Email |Print

As usual the bank analysts are great at making forward price predictions based almost entirely on the current performance of whatever commodity they are analysing. It means they almost all inevitably miss any major turning points in price performance.
This is particularly true of those forecasting precious metals prices and recently, given the sharp price falls which took gold down to around $1140, silver to $15 and platinum to below $1180, many of the banks have been rapidly adjusting their forward price predictions ever lower……………………………………Full Article: Source

Swiss yes vote won’t really boost gold price

Posted on 18 November 2014 by VRS  |  Email |Print

Gold was trading sideways on Monday after last week’s recovery from four-and-half-year lows, but traders hoping for a stronger showing following a Swiss referendum on gold may be disappointed. The Swiss go to the polls on November 30 in a referendum that will lay down new rules for the country’s central bank concerning its gold reserves.
Surveys are divided about support for the “Save Our Gold” camp that would force the Swiss National Bank to hold 20% of its reserves in gold, repatriate bullion held outside its borders and halt all sales, and not everyone even agrees that a yes vote would lift gold prices…………………………………Full Article: Source

Is OPEC Doing what it is saying?

Posted on 17 November 2014 by VRS  |  Email |Print

OPEC will have its incoming 166th meeting on November 27th of this month. This is a considerably important meeting for oil prices, global economic growth and all motorists in the world. OPEC has said that it will not cut its production and will let oil price decline, which has actually plunged by more than 25% this year. Will OPEC cut its production in order stabilize oil prices? Saying it in another way, are the Saudis bluffing about being comfortable with current oil production and are not happy with the market doing the pricing?
To answer this question, we can look at OPEC’s current production and its production history. And since OPEC is really Saudi Arabia, we can bring up the subject of whether the Saudis are tactical or strategic decision makers……………………………………Full Article: Source

Gold and Silver 2015 Trend Forecasts, Prices to Go BOOM

Posted on 17 November 2014 by VRS  |  Email |Print

“Finally!” in English, “Por fin!” in Spanish and “About bloody time!!” in Australian. The belated rally in gold and silver finally got underway when it was least expected. The contrarian wins again!
The final bear market rally in gold and silver kicked off after a fake out move lower and should end with a fake out move higher. That’s the way I see it anyway. Of course the permabulls will be back out in force again calling the next great bull market now in progress and this rally should terminate when those calls reach fever pitch……………………………………Full Article: Source

Could Gold Reach $800?

Posted on 17 November 2014 by VRS  |  Email |Print

They say beauty is in the eyes of the beholder. And what could be more beautiful than bullions of pure gold? Gold has always held a special allure for jewelry lovers. But it has also been a key investment commodity. Gold has been regarded as a crisis hedge, a currency hedge, an inflation hedge and a deflation hedge.
Since 2011, however, gold has topped out and has fallen almost 40 percent from its all-time highs, far below bulls’ anticipated targets. Silver, too, has crashed, along with many other base metals. Growth in developed and underdeveloped economies has slackened considerably of late, a reflection of the slowdown in the manufacturing industries around the world. In fact, at this point, there is no good reason for investors to hold gold in the U.S……………………………………Full Article: Source

GE’S Rice Says Commodities Slump Puts Premium on Products

Posted on 14 November 2014 by VRS  |  Email |Print

General Electric Co. (GE), which provides everything from oil drilling systems to vehicles for underground mining, said it expects to benefit from lower commodities prices as producers chase cost cuts to offset declining revenue.
The company can still gain from demand for equipment and services that help trim expenses even as slumping prices for crude and other raw materials makes orders “a little bit bumpier,” GE Vice Chairman John Rice said in an interview in Rio de Janeiro………………………………..Full Article: Source

Gold: The One Commodity Buffett and Bernanke Just Don’t Understand

Posted on 14 November 2014 by VRS  |  Email |Print

The Royal Mint gets it. Because I see such deep value in gold today, I was exploring various national mints last week, looking to buy some bullion — maybe some Austrian Philharmonics, some Canadian Maple Leafs or a few Britannia’s from the U.K.
And while reading through the bullion site for Britain’s Royal Mint, I came across some highly unexpected commentary. While the likes of Ben Bernanke, Warren Buffett and others here in the States offer inane commentary on the uselessness of gold, the 1,100-year-old Royal Mint had this to say: Gold is the ultimate store of value. Gold is the original and still the most far-reaching global currency…………………………………Full Article: Source

Do something about gas prices? Why?

Posted on 13 November 2014 by VRS  |  Email |Print

Oil prices are plunging. Gasoline is now cheaper than milk. Why doesn’t Washington do something already? Since peaking in June, the price of oil has tumbled by 25 percent. Texas light sweet crude futures have fallen to around $77.40 a barrel, a three-year low, while Brent oil, the global benchmark, sank on Monday to its lowest price in four years.
With cheaper oil has come cheaper gasoline. The national average price for a gallon of regular is now just $2.926. Drivers haven’t seen pump prices this low since December 2010. Nor have they seen such a sustained decline — the price has dropped for 46 days in a row — since 2008. According to AAA, “the national average could fall another 5-15 cents in the coming weeks, which could make for the cheapest Thanksgiving gas in half a decade.”……………………………………….Full Article: Source

ETF Securities: commodities still attractive for investors

Posted on 12 November 2014 by VRS  |  Email |Print

Commodities are starting to attract buyers looking to benefit from the recent sharp prices falls. ETF Securities associate research director Nitesh Shah suggests that despite several weeks of falling commodity prices, further falls should not be expected without causing a supply response. This has prompted an increase in inflows to the company’s commodity exchange traded products (ETPs), with energy currently the favoured play.
The previous week saw the largest inflows in six weeks, with investors looking to take advantage of oil prices slumping to a five-year low. Some $12.3 million went into long crude oil ETPs, with the majority favouring WTI over Brent………………………………………..Full Article: Source

Why Australia will survive the commodity slump

Posted on 11 November 2014 by VRS  |  Email |Print

It’s not a well-known fact, but a slump in commodity prices has never caused a recession in Australia. With that in mind, we shouldn’t be overly concerned by investment bank analysts who run around saying just this — they are very wrong. Indeed, amid all the wailing and gnashing of teeth, it strikes me that the commodity drop may even be beneficial.
I realise this point may seem counterintuitive, and may even be met with howls of outrage — commodities account for about 73 per cent of our exports. Yet the point is, a drop in commodity prices isn’t all bad. No doubt profits for ‘our’ commodity exporters will plummet — sharply maybe — yet it’s often forgotten that our commodity exporters aren’t really true blue Aussies………………………………………..Full Article: Source

Will Deener: Is it time to buy commodities?

Posted on 11 November 2014 by VRS  |  Email |Print

A central Illinois farmer cultivates his harvested cornfield in Morton, Ill. Corn prices skyrocketed from about $2 a bushel in 2006 to about $8 a bushel in 2012. Today, corn prices are down about 50 percent from those lofty levels. Not so long ago commodities were all the rage, but surprisingly, this asset class has been abandoned by big and small investors alike.
Throughout much of the past decade, investing in crude oil, metals and grains became increasingly popular as China grew into an economic juggernaut. Demand for commodities outstripped supply and prices soared………………………………………..Full Article: Source

Why Silver Is the Only Precious Metal You Should Even Consider Buying

Posted on 11 November 2014 by VRS  |  Email |Print

The precious metals have been hammered recently as a rapid climb in the U.S. dollar has overshadowed any safe haven demand for gold, silver, platinum, and palladium. A higher greenback is a negative for precious metals because they are U.S. dollar denominated commodities. What this means is that when the U.S. dollar appreciates it makes these commodities more expensive for holders of international currencies, and thereby reduces their demand.
We know that history repeats itself and everything is cyclical. This means eventually the price of these metals will rebound, but right now given the climate, there is one metal that is best positioned to rally, and that is silver. Here is why………………………………………..Full Article: Source

Silver demand coming back, say experts

Posted on 10 November 2014 by VRS  |  Email |Print

Gold and silver are on a falling streak. Gold, a hedge against inflation and considered a store of value, and silver have been falling over the past two years from earlier peaks. This fall has aggravated and investors have started looking at these as an opportunity. Between the two, silver is emerging as a stronger bet for the long-term.
Investors have looked at silver as a surrogate for gold, especially when the gold trade faces restrictions. In India, several restrictions have been placed on gold import, after it was held to be putting pressure on the current account deficit. Silver is finding incremental demand from jewellers; non-traditional investors have also started looking at silver for investment, as prices are falling………………………………………..Full Article: Source

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ABN Calls Gold a Falling Knife With Prices at $800 Next Year

Posted on 07 November 2014 by VRS  |  Email |Print

The selloff in gold is set to deepen as the dollar will probably extend gains, according to ABN Amro NV, which forecast that the precious metal may end this year at $1,100 an ounce and finish 2015 at $800.
“Don’t try to catch a falling knife,” analyst Georgette Boele wrote in an e-mailed report received today. “The U.S. dollar rally has further to run, especially if the Fed turns more hawkish this year.” Bullion retreated to the lowest level since April 2010 yesterday as the dollar advanced and holdings in the largest bullion-backed exchange-traded product contracted………………………………………..Full Article: Source

Precious Metals Drop, With $1.5 Billion Wiped From Funds

Posted on 06 November 2014 by VRS  |  Email |Print

Gold, silver and platinum tumbled as the dollar’s advance to a five-year high cut demand, wiping almost $1.7 billion from the value of precious metals-backed funds. Gold and silver slid to four-year lows as the Bloomberg Dollar Spot Index climbed after Republicans gained control of the Senate from the Democrats in U.S. midterm elections and Bank of Japan Governor Haruhiko Kuroda said he saw no limit to the steps the BOJ may take to defeat deflation.
About $1.66 billion was erased from the value of precious metals exchange-traded product holdings today. The Federal Reserve is moving closer to raising interest rates just as other central banks seek to spur their economies………………………………………..Full Article: Source

Silver Price What Happens Next?

Posted on 05 November 2014 by VRS  |  Email |Print

I expected the triple bottom in gold and silver to hold. It did not! Silver crashed lower (from $19.28 on August 28 to $17.26 on October 29 to under $16 on October 31) and then gold plunged below $1179 to about $1160.
What now? More of the same. Both silver and gold fall further. The High Frequency Traders and central banks have plenty of “dry powder” and can push prices lower. From the perspective of the Asians who are buyers, what is not to like? Or, Both rally from here, flop around, and then fall further………………………………………..Full Article: Source

Six reasons why gold prices can continue to sparkle

Posted on 04 November 2014 by VRS  |  Email |Print

Here’s a little-known fact about gold — over the past decade to June this year, it outperformed all major asset classes, including equities and property. But mention gold today as an investment option and the talk is all gloom and doom. It seems the 2013 correction, where gold fell 15 per cent in Australian dollar terms, has convinced many investors that the bull market in this precious metal has run its course.
Well, I would beg to differ, arguing there are several reasons why demand for gold will increase, and that the next major move in the gold price is likely to be substantially higher………………………………………..Full Article: Source

We Are Closing Our Buy Rating On Commodities

Posted on 03 November 2014 by VRS  |  Email |Print

The deteriorating global economic growth momentum is the most important factor behind our bearish view on the commodity market. The global economy is more fragile than it was six months ago. Our economists have offered a cautious assessment of conditions this quarter, and we are even less confident about prospects for the next quarter.
At the same time, prospects for an extended recovery appear dim. Particularly sharp falls in export orders of the major countries suggest that trade growth is also rapidly losing momentum………………………………………..Full Article: Source

OPEC chief sees no big change on oil output in 2015

Posted on 31 October 2014 by VRS  |  Email |Print

The Organization of the Petroleum Exporting Countries (OPEC) is unlikely to change much on its output next year, and there is “no need to panic” at the price drop, said the OPEC’s secretary general Abdalla El-Badri Wednesday in London.Badri said:” I don’t think 2015 will be far away from 2014 in terms of production. There is nothing wrong with the market.”
OPEC’s expected production level is 30 million barrels per day (bpd) this year. “If prices stay at 85 U.S. dollars, we will see a lot of investment, a lot of oil, going out of the market, about 65 percent of the producers, they have high costs. Not OPEC,” he told the conference………………………………………..Full Article: Source

Gold is up and defying expectations

Posted on 30 October 2014 by VRS  |  Email |Print

The World Gold Council has encouraged investors to consider gold as a valuable component in an investment portfolio. It comes as the council announced that the price of gold is up, amid record low volatility and against analysts’ forecasts, the World Gold Council has said.
In its six-page investment report, the body has shown that the gold price is up 3.4 per cent in the year-to-date, and has been above its 2013-end price for all but two days this year, defying predictions from analysts who had generally expected lower prices………………………………………..Full Article: Source

Investors Turning Their Gaze To Silver

Posted on 30 October 2014 by VRS  |  Email |Print

While silver prices have trended lower over the last three months, investor interest in the white metal has been tracking upwards, said an executive with the Silver Institute.
The Silver Institute released a report Oct. 22, produced by the CPM Group, stating that investors may increase their net silver purchases by as much as 1 billion additional ounces in various investment instruments over the next decade………………………………………..Full Article: Source

What a commodity bust would mean for Canada’s economy

Posted on 27 October 2014 by VRS  |  Email |Print

The past few months have brought shock and upheaval to energy markets, as well as angst to many corners of the Canadian economy. Since June, the U.S. price of oil has plunged more than 20 per cent, briefly tumbling below US$80 a barrel last week.
The decline has weighed heavily on Canadian stocks, which were already caught in the downdraft of a global stock market correction. Even after several days of recovery, the S&P/TSX index was, as of Tuesday, still below the peak it reached just before the Great Recession six years ago………………………………………..Full Article: Source

Gold loses sheen

Posted on 27 October 2014 by VRS  |  Email |Print

After a sharp rise in the beginning of last week, the yellow metal lost momentum and reversed lower. It fell to a low of $1,226 on Thursday before closing at $1,231 on Friday, down 0.6 per cent for the week. The other precious metals Silver and Platinum also closed the week in the red. Silver closed at $17.2 per ounce, down 0.4 per cent and Platinum at $1,250 per ounce, down 0.9 per cent.
Existing home sales in US beating market expectation was the initial trigger that caused a reversal in gold prices. This number increased 2.4 per cent to 5.17 million units in September from 5.05 million in August. Market was expecting a 1 per cent rise in the existing home sales………………………………………..Full Article: Source

Here’s Why Copper Is Still So Strong

Posted on 27 October 2014 by VRS  |  Email |Print

Copper is supposed to be the commodity with a PhD. That is, copper has always been seen as so ubiquitous throughout the global economy that its moves, like the Aussie dollar’s, are often taken as a proxy for traders views on global growth.
So copper’s resilience above $3 a pound over the past 4 months has been a stand-out price performance which has had traders scratching their heads………………………………………..Full Article: Source

Why It’s Finally Time To Buy Commodities

Posted on 24 October 2014 by VRS  |  Email |Print

My friend, the time has FINALLY come…It is time to buy commodities. For years, I’ve urged you to invest in the stock market and the housing market. (I hope you took my advice… Stocks and housing have soared!) But one asset class has been completely left out of the fun… commodities.
In the summer of 2008, big investors loved commodities… The Dow Jones-AIG Commodity Index peaked at a value around 240. And Harvard University, a big investor, allocated 8% of its endowment to “public commodities.”……………………………………….Full Article: Source

How commodity bourses can survive

Posted on 24 October 2014 by VRS  |  Email |Print

In commodity, like any other trading one does not mind paying a transaction fee as long as profits are made. However, once an entity starts making losses, the concern on the high transaction fee becomes multi-fold. On the other hand, when commodity exchanges start making losses, they may be forced to increase transaction fee camouflaged under some other name to boost the revenue.
This often causes narrowing of participation and alienation of new participation on the exchange platform. Comexes, which till a few years ago were embarking on global ambitions, are now struggling for survival. Of the first three national exchanges that were granted license, one continues to make profit due to low cost of operation, the other is showing signs of operating losses while the third continues to struggle………………………………………..Full Article: Source

Can the Indian-Chinese Gold Frenzy Boost Prices?

Posted on 24 October 2014 by VRS  |  Email |Print

Many investors aren’t pleased with the current price of gold , which closed Wednesday at $1,241.10 per ounce, but for buyers in India, the metal’s ill fortune has turned into an opportunity. CNBC reported that a better Indian economy has prompted those in the country to buy the yellow metal during this year’s five-day Diwali festival, which will peak on Thursday.
“[T]here is more money around to spend,” Matthew Turner, a precious metals analyst at Macquarie, told the news outlet. Also helping sales is a slight relaxation in the 80:20 rule. Put in place by the Indian government back in 2012, it mandates that 20 percent of imported gold be set aside for re-export. Along with a concurrent jump in the country’s gold tax from 2 to 10 percent, it put quite a damper on gold sales last year………………………………………..Full Article: Source

Gold Is Undervalued – Ned Goodman

Posted on 23 October 2014 by VRS  |  Email |Print

Ned Goodman, president and chief executive officer of Dundee Corp., believes gold is undervalued while equities are poised for a crash. Speaking at a keynote luncheon at the Quebec Mining Exploration Xplor 2014 Convention in Montreal, Quebec, Goodman was blunt regarding gold prices and where they’re heading.
“We think gold is very undervalued at current gold prices,” Goodman said. “I think gold will hit $1,200, and when it does, be a buyer because I think that will be a good place to be.” Touching on stock markets, Goodman didn’t pull any punches, calling it a Botox market where all deficiencies are simply covered and propped up to look healthy………………………………………..Full Article: Source

Will Gold Outshine Platinum? — Overheard

Posted on 23 October 2014 by VRS  |  Email |Print

Gold and platinum are prized for their rarity. What is happening with their prices right now is also pretty unusual. At about $1,245 an ounce, gold isn’t far off parity with platinum at about $1,270. This doesn’t happen often. In the past 20 years, gold has matched or exceeded the platinum price only about 7% of the time. And much of that occurred between the summer of 2011 and early 2013, when quantitative easing was in full swing and hyperbole about the dollar’s demise was at its height.
Similarly, the current price action reflects an anxious world. Gold hasn’t really gained much this year; rather, platinum has collapsed since July. This makes sense. as more than half of platinum demand relates to industrial, primarily, automotive uses. Deflation fears have whacked industrial commodities………………………………………..Full Article: Source

Gold and Silver Timing is Everything

Posted on 23 October 2014 by VRS  |  Email |Print

Timing is everything in investments, and after watching the precious metals markets for the past three months, since the publishing of his last article at the June lows, Peter draws the conclusion that gold bullion and gold mining stocks have finally bottomed and are ready to resume the bullish trend than began twelve years ago.
The fundamentals support an end to the correction that began in September of 2011: 1. Asian and Russian banks continue to accumulate gold faster than mines can produce this precious metal. 2. Western nations are running ongoing Federal Deficits. Deficits are always covered with printing press money. This ‘currency destruction’ causes investors to add gold and silver to their net worth………………………………………..Full Article: Source

Chinese and Indian gold buyers back in market in a big way

Posted on 22 October 2014 by VRS  |  Email |Print

What has been particularly strange about the gold market over the past two years is that the stronger the physical demand appearing for gold, the weaker the gold price has tended to get.
In the past few months, the gold price has fallen back from around $1,340 down at one time to $1,190 and now hovering back seemingly trying to breach $1,250 on the upside again, yet by all accounts demand in the two biggest consuming nations has been soaring and they are, between them, taking in virtually everything the world’s gold mines can produce………………………………………..Full Article: Source

Is This Crunch Time for Base Metals?

Posted on 22 October 2014 by VRS  |  Email |Print

Anyone investing in industrial metals needs to be patient. Copper, nickel, zinc and tin are likely to suffer low prices for some time yet, traders and analysts warn, though many are hopeful they’ll hit a floor soon. Demand has been dented by weakening global growth—not least concerns about a Chinese slowdown–which means metal consumption isn’t rising as fast as many had expected.
Traders are feeling particularly grim about copper. According to a survey of LME Week participants conducted by Macquarie Group Ltd, copper is the metal that people most want to bet against — the first time that’s been the case in six years. By contrast, traders are more optimistic about zinc, according to the survey………………………………………..Full Article: Source

Is the oil price fall more than just a coincidence?

Posted on 21 October 2014 by VRS  |  Email |Print

The recent drop in oil prices could be due to more than just lower demand, according to some analysts, who have suggested that the U.S. could be deliberately manipulating the market to hurt Russia at a time of geopolitical stress.
Patrick Legland, the global head of research at Societe Generale, conceded that he had no in depth knowledge of the situation but claimed that it was an “interesting coincidence” that the two events were happening at the same time………………………………………..Full Article: Source

American specialists expect two-fold rise in gold prices by the end of 2014

Posted on 21 October 2014 by VRS  |  Email |Print

American economists, such as John Williams, Peter Schiff, Paul Craig Roberts and Gerald Celente, expect the global revaluation of world currencies by the end of 2014. American statistical analyst Jim Willie explained the mechanism of such revaluation: Shanghai gold exchange is to eventually take over global price controls for the monetary metal away from the Comex (New York commodity exchange), and then force a global currency reset by raising the price of gold to its true or actual value, which exceeds the current price at least two-fold.
“When we get this next global currency reset, it’s going to be a complete reset. It apparently will happen predominantly in the gold world. They are going to change the price of gold, and jam it down the U.S.’s throat………………………………………..Full Article: Source

Five reasons to buy gold now

Posted on 20 October 2014 by VRS  |  Email |Print

The last few years have been harrowing for gold investors, with international prices of the metal declining from $1,921 per troy ounce to about $1,240 now. But hold on, don’t write off gold yet. Global supplies of the yellow metal are likely to shrink as new reserves become increasingly difficult to find. And given that the Asian appetite for gold is set to grow, gold demand may only go up.
Here are five reasons why you should buy gold now: In the years ahead, it is likely to get increasingly difficult for producers to find easy-to-mine deposits of gold. At 2,968.5 tonnes (Thomson Reuters GFMS data), many investors believe that 2013 may be the peak year for gold production………………………………………..Full Article: Source

Why worry about bullion silver?

Posted on 20 October 2014 by VRS  |  Email |Print

Bullion silver is likely to be less pure than coins or small bars, but 1,000 ounce bullion silver bars are cheaper per ounce than the smaller fabricated sizes. Bullion silver is typically available for only a few cents more per ounce than the spot price in the paper futures market.
So long as bullion bars can always be purchased at little more than spot price, a business that simply melts the bars would never pay more to melt fabricated silver, even if it is more highly refined. If the business could not buy cheap bullion bars locally, it would simply go long a futures contract and then stand for delivery of the physical bullion silver. If a company cannot get bullion bars from the futures market to consume for its production needs, then there will be a delivery default on the futures exchange………………………………………..Full Article: Source

Recent decline in crude oil price artificial: Jim Rogers

Posted on 17 October 2014 by VRS  |  Email |Print

Even as crude oil prices have dipped to all-time lows, Jim Rogers of Rogers Holdings told ET Now that the decline is ‘artificial’. “Some of this (oil price decline) is artificial. OPEC is trying to drive down prices because of Shale competition. The oil situation is very artificial at the moment.”
“It looks like a lot of people are dumping. This is artificial. Though I would not be dumping oil myself,” Rogers said. Asked about the US Shale gas boom, Rogers said, The Shale boom will not continue very strong especially if prices do come down. That is high cost oil, and remember those are very short lived wells,” Rogers said. “The production runs down very quickly,” he added. ……………………………………….Full Article: Source

The Real Reason Behind Gold’s October Surge

Posted on 17 October 2014 by VRS  |  Email |Print

On October 6 when GLD was trading for $114, I outlined a surprising case for the bullish trend change in the precious metals by asking the question accompanying the chart below, “What is this a chart of?”
In my article, “This Secret Uptrend Will Surprise You,” I laid the case for a rally in the precious metals on the back of a short term bottom in the Euro. That article and chart were extremely important for those owning precious metals as the updated chart below shows price has held its trend (in Euros) and has again started to advance………………………………………..Full Article: Source

How To Use a Trend-Following Strategy In Commodities

Posted on 15 October 2014 by VRS  |  Email |Print

A recent article in the Financial Times highlights why, in part, the steam has gone out of the commodity markets. Judging the super cycle to be at and end investors have exited the market en mass in the belief no money is to be made from a falling market. After making 7% returns in the first half of the year from simply tracking the Bloomberg (formerly Dow Jones) Commodity Index, the third quarter has seen prices fall across the board.
According to the FT, figures compiled by Citigroup show net withdrawals from exchange-traded and commodity-linked funds totaled $8.2 billion in the 3 months to the end of September, canceling out inflows of $7.5 billion in the first half of the year………………………………………..Full Article: Source

Palladium stands out from commodities crowd

Posted on 15 October 2014 by VRS  |  Email |Print

“Palladium is the outlier in the metal space,” says Walter de Wet, commodities strategist at Standard Bank. Speculative short positions – bets that the price will drop – have been rising across the market since mid-August, not surprising given the negative sentiment shift of late.
The selling has hit both precious and industrial products, with silver and copper shorts at the most in at least five years, Mr de Wet notes. The palladium price has slipped more than $100 over the past few months but, in contrast to peers, palladium shorts have also been falling………………………………………..Full Article: Source

Will Gold Prices Make A Reverse Swing?

Posted on 14 October 2014 by VRS  |  Email |Print

This is the festival time in India and should investors consider this sell-off as an opportunity to buy precious metals on the cheap? Is it the right time to buy Gold? Why this decline may not benefit Indian consumers? Take International Gold prices which fell under $1,200 an ounce this week for the first time in 2014.
Looking at technical price charts, a nearby continuation chart shows the December 2013 low of $1,180, which is just above the June low of $1,179.40. How the physical market responds to the trip under $1,200. Chinese traders will return to the market next week after their Golden Week holiday ends, and they anticipate these lower prices will stimulate Chinese demand………………………………………..Full Article: Source

Will gold and silver prices continue to go up as stocks go down?

Posted on 13 October 2014 by VRS  |  Email |Print

Last week gold and silver prices advanced by three per cent while the S&P 500 lost that much in its worst week for two years. Is this a new trend? Gold has almost certainly traced out a bullish triple bottom in its price chart, although the position looks less clear on the silver chart. Many areas of the US stock market are already past 10 per cent corrections while the major indexes are the last dominos to fall and on their way down now.
Is this a straightforward rotation into safe havens? T-bonds are also up. Riskier assets like junk bonds are out of favor like small cap stocks. True but this is not going to be a repeat of the 2008-9 wipe-out for precious metals for three reasons. First, gold and silver have just completed a three-year-plus correction. They are not at the top of their cycle waiting for a correction like equities today as they were in late 2008………………………………………..Full Article: Source

Commodity free fall

Posted on 10 October 2014 by VRS  |  Email |Print

The International Monetary Fund (IMF) expects commodity prices to decline till 2019 across fuel, metal and agricultural products. It expects inflation in emerging markets to decline due to softening prices, especially of food. That will be good news for India. Low energy prices will mean a lower current account deficit for the country.
Low inflation can mean lower interest rates, lower costs for producers and more money with consumers, leading to better corporate earnings growth. Nevertheless, IMF also cites the risks of oil prices rising due to geopolitical conflicts in Ukraine and the Middle East. And producers such as farmers and metal companies may feel the heat, and if they cut output, these projections will be at risk………………………………………..Full Article: Source

What are commodities and the dollar telling us?

Posted on 09 October 2014 by VRS  |  Email |Print

Commodity prices are tanking while the dollar soars, and this action tells volumes about market action and where new opportunities might be found. Here are some takeaways from action in commodities and the dollar:
Commodity prices rise and fall inversely to the strength of the dollar. Since Aug. 28, the dollar has been on a steady climb, so ETFs like the PowerShares Bullish Dollar UUP, -0.44% have been a good place to be as the ETF is up more than 7% since early August. This is likely to continue as quantitative easing comes to an end and the Fed moves toward raising interest rates………………………………………..Full Article: Source

Morgan Stanley Says Gold One Of The Least Desireable Metals

Posted on 09 October 2014 by VRS  |  Email |Print

Asian markets are trading on a negative note ahead of the US Federal Reserve minutes today and concerns that global economic growth may worsen in future after International Monetary Fund (IMF) cuts the global growth forecast to 3.8 percent in 2015 from earlier estimates of 4 percent. This morning China’s HSBC Services Purchasing Managers’ Index (PMI) declined by 0.6 points to 53.5-mark in September as against a rise of 54.1-level in August.
Gold rose for a second session on Tuesday as its safe-haven appeal increased after the International Monetary Fund cut its global economic growth forecasts and weak German industrial data stoked further concerns. Gold is trading at 1213.30 up by just under $1.00 in the Asian sessions………………………………………..Full Article: Source

International Gold Price should Bottom around $1,100 per Ounce

Posted on 09 October 2014 by VRS  |  Email |Print

Gold has lost its year to date gains post Friday’s blockbuster US jobs data. The headline US unemployment rate came in at 5.9% - the last time the unemployment rate was below 6% was in July 2008.
The US economy added 248,000 jobs in September, which marked the 48th straight month of job creation. This was sufficient news flow for traders to push back the price of the precious metal below $1,200/ounce as the probability of an earlier than expected rate hike by the Fed looks likely………………………………………..Full Article: Source

Commodity super cycle going bust

Posted on 08 October 2014 by VRS  |  Email |Print

One of my key macro themes for next decade is the bust unfolding in the commodity super cycle. There are three macro forces driving this end: China’s structural rebalancing away from commodity-centric and debt-charged investment-led growth; the moderate rebound in US economic prospects, modest rises in interest rates and US dollar bull market; and, oversupply rushing to market in all sorts of commodities.
That gives you the rather sad combination of falling demand, increasing supply and a monetary headwind given most commodities are priced in US dollars, the complete inverse of the super cycle conditions that have prevailed through much of the post-millennial period………………………………………..Full Article: Source

Are Commodities Telling Us It’s 2008 Redux?

Posted on 08 October 2014 by VRS  |  Email |Print

We can look back to the 2008 global financial market meltdown and cite any number of warning signs that became so painfully obvious in hindsight. Perhaps the clearest warning sign that trouble was just around the corner began in July of 2008 when virtually all commodities entered into a steep tailspin which they would not pull out of for at least another 8 months:
Platinum, WTI crude oil, and copper offer a sampling of the steep downside reversals that commodities as a group suffered beginning in July 2008. Perhaps what was most interesting about the commodities collapse of summer 2008 was the consistent commentary that the bullish thesis for commodities (China, BRICs, global growth, etc.) was still very much intact even as prices continued to tumble………………………………………..Full Article: Source

Don’t get whipsawed investing in the gold market

Posted on 08 October 2014 by VRS  |  Email |Print

Before you jump into gold, be aware that it is a very thin market, one in which you can get whipsawed very easily. Right now, gold might seem very attractive. After reaching an all-time high of $1,950 an ounce back in September 2011, the benchmark gold future contract GCZ4, -0.16% did a 180 and closed last week just below $1,193 an ounce. This was a plunge of 38%, bringing gold’s price to its lowest level since February 2010.
September’s drop of 6.3% was the biggest monthly decline in 15 months. The retreat for the third quarter as a whole was 9%. Although gold did edge back over $1,200 as this week got underway, the underlying mood remains decidedly bearish………………………………………..Full Article: Source

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