Market resignations

March 14, 2016 10:46 AM

Currencies

The U.S. dollar index closed at 96.205, up 15 ticks gaining against the Japanese yen which closed at 08787.5, down 56.5 points. The dollar also gained its other trading partners with the euro losing 50 points to $1.1150.5, the Swiss franc dropping 3 little ticks to close at $1.0175. Gains were posted in the British Pound of 2 points to $1.4379, the Canadian dollar 65 points to 75.59c, and the Australian dollar 1.03 points to 75.55c. We prefer the sidelines for now.


Energies

April crude oil closed at $38.50 per barrel, up 66c or 1.7% and for the week gained 7.2% for its fourth straight weekly gain. April gasoline gained a half penny to $1.444 per gallon up 8.2% for the week. April heating oil just about even at $1.218 per gallon but for the week was up 4.9%. Price gains were to a great extent the result of the International Energy Agency indicating that a bottom of price may have occurred and declining supplies should help reduce the global glut of crude oil. Unfortunately our view is quite different.

We see no growth in the United States and its trading partners and even China with a GDP of around 7%, was less than anticipated earlier. Baker Hughes on Friday reported that the number of total active U.S. oil rigs declined to its lowest weekly level on record. That also led to the psychological bullish view and price gains. We look for another round of long liquidation for crude and would avoid putting on any long positions in crude.


Precious metals

April gold closed at $1,259.40 per ounce, down $13.40 or 1.1% and declined 0.9% for the week after recent price gains when equities were under pressure and money found it’s way to the relative safety of Treasuries and gold. That "boat has now sailed" and we look for continued pressure on gold prices regardless of what the pundits and "purveyors of hype" on TV are promoting.

May silver was up 5.6c to close at $15.604 per ounce, but for the week lost 0.6%. For the white metals, April platinum lost $8.00 to close at $969.70 per ounce and for the week lost 1.7%. June palladium gained $6.00 or 1.1% to close at $579.95 per ounce for a weekly gain of 3%. However we remain on the sidelined as we see no clear trend and overall demand tied to the auto industry which uses these metals in catalytic converters remains lackadaisical. Leave the money "in the mattress" for now.

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About the Author

John has over 40 years experience at major U.S. Brokerage firms as Manager and Director of various International Divisions and is the founder of his own trading and brokerage firms. Over the years John has gained a wealth of knowledge and experience in all aspects of investments and trading. He was also a floor trader at the Commodity Exchange in New York. He formed Acuvest in 1999 and can be reached at futures@acuvest.com.