Mixed cheers on the March US retail sales data. Although we have the first increment by about 0.9% it was slightly less than economists had expected. EUR/ USD seized the opportunity as USD took a moment to yield some ground. But the US debt markets are already pricing an increment of somewhere between 0.1 to 0.25 this year. The Fed ever watchful will be taking note of how the debt markets are pricing Treasuries at an increment forward through end of this year and will likely take action to keep in toe with treasury price action. It is the market that sets rates at the end of the day. Although there is not much
to cheer about in the Euro zone a recent poll of economists by Reuters indicates that overall the initiation of the Q.E. program is about to do more good than harm in finally sorting out European government debt. Noticeably all the hype and trader frenzy over a Grexit talk has significantly diminished as the European locomotive starts and stutters and lurches finally lurches forward.
Read on Bloomberg fresh trader concern over Greece debt talks with the ECB this week -
http://www.bloomberg.com/news/articles/2015-04-14/greek-talks-to-resume-amid-concern-reform-deadline-won-t-be-met
Crude oil inching up. WTI now pricing spot above 55 and holding with forwards to 58 by the end of the year. Price optimism is exactly what the crude oil market needs. The last several years of over production finally got a jolt when specs drove down the price from the 100 Dollar level late last year. Many shale producers cut back on production and oil companies have laid off workers and put rigs to idle mode as the prices sunk below operational cost. This market badly needed a shake up albeit the jolt came from speculators and a massive Saudi determination to force down the price of oil to begin a price war. But now prices are creeping back up that is a good sign for the US shale industry which could look at a more tentative operational expansion through 2016. The world did not collapse and even with the Dollar strength there are fundamental reasons why oil prices may creep back up instead of the dire 20 Dollars warnings from some analysts. The only real worry still remaining is the sheer amount of ETF long positions in the futures market and any significant offloading instead of usual rolling over of contracts can trigger an adverse a temporary blip in prices yet again.
Read on Reuters today an analysis of a more balanced US oil market for the remainder of this year -
Bullion marches is in a holding pattern at the 1200 mark but the long term outlook for interest rates and possible increases in core inflation in USA could with a run in to the 2% mark this year could the send the precious metal back up. Given that US debt is phenomenal and more dollars need to come into circulation to pay back Treasury debt, on top of commodity price increments, the outlook for bullion holds for steady price growth because quite simply put the US debt markets - government and corporate are not going to shrink as Wall Street funnels more investment into the US economy.
Always look to support and resistance band lines as the key to understanding in the long and short term where prices are converging. Professional technical traders use 50 day and 200 day medium and slow moving averages as fundamental cornerstones for interpreting the direction of price action.
98.944 +0.167 +0.21%
Support 97.757 Resistance 100.577
EUR
1.065055 +0.008055 +0.76%
Support 1.04633 Resistance 1.08193
Crude Oil
55.12 +0.25 +0.46%
Support 51.01 Resistance 55.93
Gold
1193.180 -7.565 -0.63%
Support 1,174.7 Resistance 1,210.3
Pieter Bergli - DeLoren Trust Holdings
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