On Friday, Energy Information Administration (EIA) released an interesting statement. In their estimation, the United States will pass Saudi Arabia and Russia to become the leading exporter of crude oil in the next twelve months. The country will be producing more than 10 million barrels of crude oil every day. This is an important development. In the past decades, the United States has had a complex relationship with Middle Eastern countries and Russia. It depended on their crude oil. These countries, including the OPEC cartel, controlled every little thing about crude oil and the U.S had no say. For years, these countries have held the Unit...
Previous: On Friday the 19th of January, despite a price surge to 1.2296, trading on the euro/dollar pair closed down. The euro dropped against the dollar to 1.2214 before trading closed in Chicago. The euro’s decline was brought about by a rise in US bond yields as well as market participants awaiting the results of an SPD vote in Bonn on whether or not to enter formal coalition talks with Angela Merkel’s party. US 10Y bond yields have risen from 2.61% to 2.66% (high from 2014). The greenback received also some support from the President of the San Francisco Federal Reserve, John Williams, who said that the Fed would continue on its pat...
Wall Street certainly didn’t have much in the way of negative thoughts with respect to the prospects for a federal government shut down last week. Even though White House Office of Management and Budget and interim Consumer Finance Protection Bureau director Mick Mulvaney gave a “between 50 and 60 percent” chance that the U.S. Congress would fail to reach an agreement to keep the entire government open as a legislative deadline neared, which was widely known well before the market closed, U.S. stock prices went on to close on Friday, 19 January 2018 at their highest level ever. That’s largely because where investors a...
Welcome to another edition of Macro Mondays! So when we reach retirement, it’s nice that we can have a cushion of savings in a 401(k) or IRA of some kind. However, if the retirement account is not ‘Roth’ in nature, there are some major tax implications if one does not take out money on a scheduled basis after age 70 1/2. With tax-deferred accounts, the IRS grows impatient and wants to tax them as soon as they are able, so to encourage retirees to withdraw money to tax, they enforce what is known as the ‘required minimum distribution’ amount on retirement accounts. What is the ‘Required Minimum Distributio...
Following on from the popular “Top 10 PE10 Part 2” post, there were a few questions from readers about where various other countries sit in the rankings. So here is a follow-up post, the PE10 part 3! As requested, first up is a table showing the rankings for 45 countries on the PE10 valuation metric (price divided by rolling 10-year average earnings). As noted, there are a couple of rankings in there that may come as a surprise. But since we are casting the net wider on the snapshot of rankings, I also wanted to explore a couple of alternative metrics. A sort of meta-analysis or statistically descriptive group of indicators (b...
EUR/USD 4 hour The EUR/USD is building a sideways retracement and the triangle chart pattern is probably just a correction within the uptrend. A bullish breakout above the resistance trend line (dotted red) could indicate the uptrend continuation towards the Fibonacci targets of wave 5 (blue). 1 hour The EUR/USD could expand the correction via a bearish ABC (brown) zigzag if price breaks below the support trend line (blue). GBP/USD 4 hour The GBP/USD is challenging the support line of the bullish channel. A break below the channel could see price test the Fibonacci support levels of wave 4 (green). 1 hour The GBP/USD is building a potential w...
AUD/USD’s upside movement from 0.7501 extended to as high as 0.8038. Further rise is still possible and next target would be at 0.8124 resistance. Near-term support is at 0.7936, followed by the bullish trend line on its 4-hour chart. Only a clear break below the trend line support will indicate that the upside movement had completed at 0.8038 already, then the pair would find next support level at 0.7807....
This is one reason why I anticipate “unexpected” disruptions in the global economy in 2018. The mere mention of “central banks” will likely turn off many readers who understandably have little interest in convoluted policies and arcane mumbo-jumbo, but bear with me for a few paragraphs while I make the case for something to happen in 2018 that will impact us all to some degree. That something is the decay of the synchronized central bank stimulus policies that have pumped trillions of dollars, yuan, yen, and euros into the global financial markets over the past nine years. Here are two charts that depict the “t...
This is one reason why I anticipate “unexpected” disruptions in the global economy in 2018. The mere mention of “central banks” will likely turn off many readers who understandably have little interest in convoluted policies and arcane mumbo-jumbo, but bear with me for a few paragraphs while I make the case for something to happen in 2018 that will impact us all to some degree. That something is the decay of the synchronized central bank stimulus policies that have pumped trillions of dollars, yuan, yen, and euros into the global financial markets over the past nine years. Here are two charts that depict the “t...