MCX's standalone Q3 net profit up 94%

Commodity exchange Multi Commodity Exchange of India (MCX) on Friday reported an exponential rise of 94 per cent in its standalone net profit for the third quarter of 2016-17.

The company informed the BSE that its net profit for the quarter ended December 31, 2016, rose to Rs 33.94 crore from Rs 17.51 crore for the corresponding quarter ended December 31, 2015.

"Our robust results for the 3rd quarter demonstrate the resilience and diversification inherent in our business," Mrugank Paranjape, Managing Director and Chief Executive Officer of MCX was quoted as saying in a statement.

"We have also used this period to invest more in preparing for the upcoming year - in terms of intensified efforts around education and training, something which will help us with imminent product launches including options but in the long term as well, with increased participation in the market".

The commodity exchange's standalone total income during the quarter ended December 31, 2016, increased by 20 per cent to Rs 68.60 crore from Rs 56.96 crore for the corresponding period of last fiscal.

The company's EBITDA (earnings before interest, tax, depreciation and amortisation for the quarter under review rose by 25 per cent to Rs 50.43 crore.

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MCX aluminium: traders can stay out of the market

The aluminium futures contract traded on the Multi Commodity Exchange (MCX) continues to remain range-bound and mixed for the fourth consecutive week.

The sideways consolidation in the range between ₹115 and ₹119 per kg remains intact.

The contract is currently hovering around the lower end of this range at ₹115.25.

Whether the contract manages to sustain above ₹115 or breaks below it will decide the next leg of move.

Traders can stay out of the market and wait for a clear trend to emerge for taking trade positions.

A bounce in the coming sessions will see the contract retaining its ₹115-₹119 range for some more time. In such a scenario a rise to ₹119 is possible in the coming days.

If the contract manages to break the range above ₹119, the up move can extend to ₹122 and ₹123. Only a strong break and a decisive close above ₹123 will bring fresh bullish momentum in the contract.

On the other hand, if the contract fails to sustain above ₹115/kg and breaks below this support, a fall to ₹114 or even ₹113 is possible.

The region below ₹114 and ₹113 is a key support zone which may limit the downside in the short term.

But a strong break below ₹113 will bring renewed pressure on the contract. Such a break can drag the contract lower to ₹110 or ₹109.

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Pick up in market volumes likely to continue; industry broking income expected to grow by 12-15% in FY 2017: ICRA

Currency trading volumes of brokerage houses have, nevertheless, grown significantly in the last 12 quarters. In the period between Q1 FY17 and Q1 FY15, volumes grew at a CAGR of 48%.
Following a lukewarm FY16 partly on account of a challenging operating environment, impact due to the increase in minimum contract size for option trading and the withdrawal of liquidity enhancement schemes that were introduced earlier, H1 FY17 saw aggregate equity market volumes recover by 14% and ADTO increase by 15%.

ADTO in H1 FY17 was higher at Rs 3.6 trillion when compared with Rs 3 trillion in FY16 and Rs 3.3 trillion in FY15. Both the decline in market volumes in FY16 as well as their improvement in H1 FY17 was led by the derivatives segment which witnessed a 9% decline in FY16 and a 14% YoY growth in H1 FY17. With the volume growth in cash and derivatives segments remaining similar, the proportion of cash and derivatives volumes continued to remain stable and stood at 7:93 during H1 FY17.

Karthik Srinivasan, Senior Vice President, ICRA Limited, said “Though the H1 FY17 performance has been better than H1 FY16, any adverse impact of the recent rate hike by the US Federal Reserve, delayed pick-up in growth and corporate profitability following the demonetisation and global volatilities could partly impact broking volumes during the second half. However increasing activity levels by the DIIs could partly alleviate concerns on reduction of trading volumes. Hence, we estimate equity market volumes growth rate of 12-15% for FY17.”

In H1 FY17, commodity market volumes rose marginally to Rs 36.8 trillion (ADTO of Rs 0.28 trillion) from Rs 34.9 trillion (ADTO of Rs 0.27 trillion) in H1 FY16. Data from exchanges indicate that the mix of volumes across commodities has remained largely stable in the last one year with Bullion contributing the largest share (36% of volumes in H1 FY17) followed by Energy (34%), Base Metal (28%) and Agricultural Commodities (2%).

Currency trading volumes of brokerage houses have, nevertheless, grown significantly in the last 12 quarters. In the period between Q1 FY17 and Q1 FY15, volumes grew at a CAGR of 48%. In Q2 FY17, however, currency trading turnover witnessed a marginal softening to Rs 18.9 trillion from Rs 20.6 trillion in Q2 FY16.

On the back of top-line pressures, both RoE and RoA witnessed softening in FY16. ICRA believes, going forward, the credit profiles of medium and large brokerage houses shall witness greater de-linking from the volatility of the domestic equity markets as they improve revenue diversification and improve usage of cost light business model. Given continued focus on lowering cost structures while expanding reach into underpenetrated regions, ICRA’s near to medium term outlook for the profitability of these brokerage houses remains positive.
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Looking at the Technicals for Horizons Bp Comex Silver Bull Plus ETF

Interested traders may be keeping an eye on the Williams Percent Range or Williams %R. Williams %R is a popular technical indicator created by Larry Williams to help identify overbought and oversold situations. Investors will commonly use Williams %R in conjunction with  other trend indicators to help spot possible stock turning points. Horizons Bp Comex Silver Bull Plus ETF (HZU.TO)’s Williams Percent Range or 14 day Williams %R currently sits at -51.01. In general, if the indicator goes above -20, the stock may be considered overbought. Alternately, if the indicator goes below -80, this may point to the stock being oversold.

Another technical indicator that might serve as a powerful resource for measuring trend strength is the Average Directional Index or ADX. The ADX was introduced by J. Welles Wilder in the late 1970’s and it has stood the test of time. The ADX is typically used in conjunction with the Plus Directional Indicator (+DI) and Minus Directional Indicator (-DI) to help spot trend direction as well as trend strength. At the time of writing, the 14-day ADX for Horizons Bp Comex Silver Bull Plus ETF (HZU.TO) is noted at 29.37. Many technical analysts believe that an ADX value over 25 would suggest a strong trend. A reading under 20 would indicate no trend, and a reading from 20-25 would suggest that there is no clear trend signal.

Investors may use various technical indicators to help spot trends and buy/sell signals. Presently, Horizons Bp Comex Silver Bull Plus ETF (HZU.TO) has a 14-day Commodity Channel Index (CCI) of 12.55. The CCI was developed by Donald Lambert. The assumption behind the indicator is that investment instruments move in cycles with highs and lows coming at certain periodic intervals. The original guidelines focused on creating buy/sell signals when the reading moved above +100 or below -100. Traders may also use the reading to identify overbought/oversold conditions.

Taking a look at other technical levels, the 3-day RSI stands at 71.81, the 7-day sits at 44.09 and the 14-day (most common) is at 37.65. The Relative Strength Index (RSI) is an often employed momentum oscillator that is used to measure the speed and change of stock price movements. When charted, the RSI can serve as a visual means to monitor historical and current strength or weakness in a certain market. This measurement is based on closing prices over a specific period of time. As a momentum oscillator, the RSI operates in a set range. This range falls on a scale between 0 and 100. If the RSI is closer to 100, this may indicate a period of stronger momentum. On the flip side, an RSI near 0 may signal weaker momentum. The RSI was originally created by J. Welles Wilder which was introduced in his 1978 book “New Concepts in Technical Trading Systems”.

Keeping an eye on Moving Averages, the 50-day is 19.3, the 200-day is at 20.23, and the 7-day is 16.59. Moving averages have the ability to be used as a powerful indicator for technical stock analysis. Following multiple time frames using moving averages can help investors figure out where the stock has been and help determine where it may be possibly going. The simple moving average is a mathematical calculation that takes the average price (mean) for a given amount of time.

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Investing at the edge

Every serious investor has felt the lure of high-risk trading at some point in their lives.It is not hard to see the attraction – the chance to make big money in a short period of time.Today it is particularly tempting, when low-risk investments such as cash and bonds offer a near-zero return. Why leave your money to die a slow death in the bank when you could be trading gold or obscure foreign currencies, shorting the price of oil or copper, or investing in frontier markets?But if making a small fortune from high-risk investing was easy, everybody would be doing it.Sam Instone, the chief executive of chartered financial planners AES International, says this is speculation, rather than investing. "It may be exciting but just like gambling, speculation is an amazing way to lose money quickly."Too many people are seduced by the get-rich-quick dream.

"They jump in, taking on high levels of risk often at precisely the wrong times – buying gold at the peak, Bitcoin after it’s jumped US$30 in an hour, or investing in penny shares that turn out to be dead cats that will never bounce."But his warning will not stop the risk-takers from pitting their wits against the market, and provided you can limit the downside it may be worth taking a chance with a small part of your wealth in the hope that it will grow to be a lot larger. Here are some of your options:Currency trading Many UAE residents will feel an instant affinity with the concept of currency trading. They are used to juggling foreign exchange, for example, earning dollar-pegged UAE dirhams, and sending them to their home country in Eur­ope, India, the Middle East, Australia or wherever.So why not turn that knowledge to your advantage by trading currencies online?

It is quick and easy to set up an online trading account, and you can also use it to hedge against any existing currency risk when transferring earnings overseas or buying a foreign property.There are plenty of currency trading websites open to UAE would-be traders including Forex, FXPro, Xtrade, Hot­Forex and XM. You can trade on almost any currency in the world, although most stick to the so-called "majors", notably the US dollar (USD), British pound (GBP), euro (EUR), Japanese yen (JPY), Swiss Franc (CHF) and Canadian dollar (CAD). Currencies are quoted in pairs, with EUR/USD one of the most widely traded currency pairs of all.Fawad Razaqzada, a market analyst at Forex.com, says today the key global trade is the US dollar. "The Federal Reserve is the only major central bank in the world that is looking to increase interest rates, and that is driving the dollar higher," he explains, adding that currencies typically strengthen when local interest rates rise, as investors can secure a better return.

"The Bank of Japan, European Central Bank and Bank of England are far more dovish, and the dollar is likely to remain strong unless the US economy suffers a shock downturn," he says, adding that investors must remember this is short-term trading, not long-term investing. "There is a daily financing charge and it can soon add up if you hold a losing position for a long time. It is also financially and emotionally damaging, you can be waiting a long time for your trade to turn good." It makes more sense to trade on short-term events, for example, an interest rate decision, economic data, elections, anything whose outcome can affect the relative value of a currency pair. However, Mr Razaqzada warns that it is really difficult to make money unless you know what you are doing. "You are against experienced investors, who have larger funds than you, can absorb their losses better, and hold a position for longer.".

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The World Is Feeling the Might of China’s Commodity Traders

The Chinese speculators shaking up global commodity markets are switched-on, flush with cash and probably not getting enough sleep.For the second time this year, trading has exploded on the nation’s exchanges, pushing prices of everything from zinc to coal to multi-year highs and sending authorities scrambling to deflate the bubble before it bursts. Metals brokers described panic earlier this month as the frenzy spread to markets in London and New York, prompting wild swings in prices that show no signs of abating.While billions of yuan have poured in from herd-like Chinese retail investors who show little regard for market fundamentals, brokers and traders say even more is coming from an expanding army of deep-pocketed hedge funds. They’re chasing better returns in commodities as stocks and real estate fade, often using algorithms and trading late into the night, when markets in London and New York are most active.

“There is no doubt that the price moves and the bigger volumes worldwide are being driven by the Chinese, and by professional speculators and financial players,” said Tiger Shi, managing partner at brokerage BANDS Financial Ltd., which counts several of those funds as clients. “The western hedge funds and institutional investors don’t really know what’s going on. Often they were used to trading macro factors or Fed policy, but now they find they have fewer advantages.”Shi, previously head of metals in Asia at Jefferies Group LLC and Newedge Financial Inc., estimates that China may have more than 5,000 hedge funds active in commodities. At least 10 manage assets of more than 10 billion yuan ($1.4 billion).

The use of algorithmic trading, in which computers execute multiple orders in milliseconds, is turbo-charging volume and volatility, according to Fu Peng, a portfolio manager at Lianzhan Global Macro Fund Management Co. About a third of activity on Chinese exchanges is executed by automated commands, which generates more volume and greater momentum in the global markets, Shi estimates.

A recent example was on Nov. 11. Copper in Shanghai jumped by the most since trading began in 2004 amid a surge in volume. On the London Metal Exchange, it gained as much as 7.6 percent, before sinking 1.7 percent in the Asian evening. The gap between the day’s high and low was more than $500, the widest in five years, and the intensity of the swing was just as big in New York futures.

“I can recall only two other occasions in my career where there was such panic and devastating price action in copper but this market today is far less transparent,” Matthew France, head of institutional sales for metals in Asia at Marex Spectron Group, said in an e-mailed report on Nov. 14. “The machine component in the market is now so much bigger as is the onshore retail and fund involvement on the Shanghai Futures Exchange and OTC options.”

The country’s biggest hedge funds include DH Fund Management Co., Shanghai Discovering Investment Co. and Shanghai Chaos Investment Group. Officials for all three declined to comment for this story.Over less than two weeks this month, the value of daily transactions on China’s three commodity exchanges more than doubled to peak at $226 billion on Nov. 14. Sparked by speculation that government reforms are helping reduce oversupply of raw materials amid signs of improving demand, Chinese money is pouring into commodities as investors look for better returns than other assets including stocks or real estate, according to Fu at Lianzhan Global Macro Fund Management.

“The nation’s supply-side reforms had a big impact on the market balance, and that’s the fundamentals behind the trading,” Fu said by mobile phone from Hong Kong. “But at the same time, we’ve got too much money there. There have been no returns from investment in industries. The stock market is neither dead nor alive. Investment in real estate also got curbed. So all the money is rushing into commodities.”For a story on how hot money is flowing back into commodities, click hereThe Bloomberg Commodity Index has returned 8.8 percent this year compared with a 7.2 percent drop in the Shanghai Composite Index of equities, and the government has imposed measures to cool the country’s real estate market.“Commodities market volatility is liquidity driven, as money from commercial bank wealth management products and private banking accounts flow into the market seeking higher return,” said Li Yulong, chief investment officer at Jyah Asset Management, a mutual fund which overseas more than 9 billion yuan.

Chinese traders are often most active during the night session, when trading also typically peaks on the LME and on Comex in New York. On almost two-thirds of the past 30 trading days, copper trading was heaviest between 9 p.m. and 11 p.m. in Shanghai, bourse data show. Analysis of volume and open interest suggests they typically hold contracts for only a few hours.

Similar to the last frenzy in April, the government-owned exchanges have stepped in to cool trading by raising fees and margins, or cutting the number of new positions allowed daily. Volume and turnover have since come off their highs but prices are still swinging. Copper is poised for its biggest monthly advance in a decade in London and has briefly jumped above $6,000 a metric ton. Zinc rose to its highest in more than nine years, while lead jumped to the most since 2011 in Shanghai on Tuesday amid record volume.

“The massive and unprecedented surge in Chinese trading volume in base metals over the past month -- but especially since the election -- has put LME metals traders on red alert,” Tai Wong, director of commodity products trading at BMO Capital Markets in New York, said in an e-mail. The price moves caused by Chinese traders make “a strong argument that the Middle Kingdom is once again the center of the world, at least for metals,” he said.

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Stocks slip after US election rally, bond yields rise further, dollar climbs

Stocks on major world markets gave back some of the week's gains on Friday, while global bond yields rose for a fifth day, supporting the U.S. dollar but pressuring commodities and emerging markets.Investors are anticipating that U.S. President-elect Trump's policies will include lower tax rates and more infrastructure spending to grow the economy, but at the expense of a wider fiscal deficit and inflation.

The Dow Jones industrial average .DJI ended at a record closing high of 18,847.66. The S&P 500 index .SPX slipped 0.14 percent to 2,164.45, weighed down by weakness in energy stocks as oil prices fell, but the benchmark index was up 3.8 pct for the week, as was the Nasdaq Composite .IXIC, its best week since 2011.
Since the election on Tuesday, equity sectors that have benefited include banks and pharmaceuticals which may see less regulation under a Trump administration, while technology stocks are seen threatened by anti-trust policies and possible disruption of global supply chains posed by more protectionist trade policies.

The S&P financials stock index .SPSY closed up 0.4 percent on Friday and up 11.3 percent for the week, the best weekly performance since May 2009.The S&P healthcare stock index .SPXHC fell 1.5 percent on Friday but ended the week up 5.8 percent, its best week gain in over two years.

The Nasdaq biotechnology index .NBI fell 0.64 percent on Friday but ended the week up 10 percent, its best week since 2000."Wall Street is going to be watching a lot of (Trump's) appointments and policy announcements to see whether it validates the more optimistic tone we've seen in the markets in the past few days," said Alan Gayle, senior investment strategist and director of asset allocation at RidgeWorth Investments in Atlanta, Georgia.European shares fell on Friday also as commodities stocks fell with oil prices and stocks exposed to emerging markets slumped on concern that U.S. President-elect Donald Trump will introduce protectionist trade policies.

The STOXX Europe 600 index closed 0.4 percent lower but the pan-European index gained 2.6 percent this week, the best weekly performance since mid-July"After panic buying, a more rational and selective phase has started," said Giuseppe Sersale, fund manager at Anthilia Capital in Milan. "The political and economic obstacles to his plans must not be underestimated".

The mining sector index .SXPP fell 2.0 percent as investors took profits from a rally of more than 10 percent in basic resources stocks this week.The European oil and gas index .SXEP closed 2.2 percent weaker, mirroring steep losses in crude oil prices after OPEC said October output reached another record, casting doubt on whether it can limit persisting oversupply.A sell-off in emerging markets hurt companies such as Standard Chartered (STAN.L) and South African paper and packing maker Mondi (MNDI.L), which dropped 6.3 percent and 4.7 percent respectively.

The MSCI emerging markets index .MSCIEF fell 2.9 percent.MSCI's all-country world index .MIWD00000PUS lost 0.6 percent but saw its best week in seven.

GLOBAL BOND YIELDS RISE FOR FIFTH DAY

Global bond markets sold off further Friday though the U.S. Treasury market was closed for the U.S. Veterans Day federal holiday. U.S. Treasury futures fell to ten-month lows on Friday.In Europe, Italian 10-year yields IT10YT=RR climbed over 2.0 percent for the first time since September 2015 while German 10-year yields rose for a fifth day.Global bond markets have seen the biggest loss of value this week since June 2013 when the Federal Reserve first discussed "tapering" its bond buying program.

The Federal Reserve is monitoring an increase in long-term U.S. government borrowing costs and will adjust policy accordingly if necessary, Fed Vice Chair Stanley Fischer said on Friday.
In his first remarks since the election of Donald Trump as U.S. president, Fischer added that economic growth prospects appear strong enough for the Federal Reserve to proceed with a gradual increase in interest rates.
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Copper, Gold, and Silver Are Stronger in the Early Hours

Copper rose in the early hours

After rising for 11 consecutive trading days, copper prices are stronger in the early hours on November 9. At 5:30 AM EST on November 9, the COMEX copper futures contract for December delivery was trading at $2.44 per pound—a rise of 2.7%.

Copper reached the highest level since September 2015

Copper prices reached the highest level since September 2015 by carrying forward the 11-day rising streak. Donald Trump’s surprise victory in the US presidential election made the US dollar fall and supported copper prices. The weaker US dollar supports the prices of dollar-denominated commodities such as copper, gold, and silver. Improved demand signals from China also supported the prices. Considering that China is the largest copper consumer, China’s major economic releases influence copper’s demand and price trends globally. The recently released Caixin manufacturing data rose to the highest level in more than four years. The manufacturing output is the highest in five and half years. There’s also improved sentiment in the copper market.

On November 8, major copper producers Freeport-McMoRan (FCX), Glencore (GLNCY), BHP Billiton (BHP), and Rio Tinto (RIO) rose 7.1%, 1.2%, 3.2%, and 1.3%, respectively. The SPDR S&P Metals & Mining ETF (XME) and the PowerShares DB Base Metals (DBB) rose 1.3% and 0.96%.

Gold and silver rose in the early hours on November 9

Gold and silver rose in the early hours on November 9. At 5:35 AM EST on November 9, the COMEX gold futures contract for December delivery rose ~2.2% to $1,302.15 per ounce. The silver futures contract for December delivery was trading at $18.69 per ounce—a gain of ~1.9%. Trump’s surprise win in the US presidential election weighed on the dollar and supported precious metal prices. On November 8, precious metal producers Barrick Gold (ABX), Newmont Mining (NEM), and Royal Gold (RGLD) fell 1.2%, 1.2%, and 0.72%, respectively, while Silver Wheaton (SLW) rose 0.94%. The SPDR Gold Trust ETF (GLD) fell 0.42%

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Should You Trade Forex During Retirement?

If you are lucky, you find yourself reaching a golden age where you can retire from the professional world to enjoy a life of comfortable leisure. Though we all aspire to have physical health and wealth when we retire, it is all too common for retirees to find themselves wishing that they were more financially stable. For this reason, new retirees often ask themselves if there is something they can do that is not too difficult, stressful or time consuming to supplement their retirement income or capital. Forex trading might fit the bill, but there are several considerations that must be made before proceeding.

Free Time

Most retirees would agree that the best thing about being retired is having lots of free time. Forex trading is something you can do at home and you can keep one eye on the screen even if you are busy with something else. So, it seems that regarding time, trading during retirement can work very well. Of course, if you plan to be very active playing golf, volunteering, travelling or visiting your grandchildren, that is something to take into account – you may not be available during the most ideal trading times to make Forex trading into a serious hobby or pursuit.

Financial Pressure & Risk

It is well known that the easiest psychological situation for traders is when there is little or no pressure to make profit immediately or regularly. This is an area where the exact circumstances of your retirement will matter. If you are well capitalized and can be relaxed about when profit arrives, you are in a strong trading situation and should be able to remain psychologically healthy which could stop you making any expensive or emotionally destructive mistakes.

Alternatively, if you are trying to make an additional regular or semi-regular income to supplement your retirement income and you truly need this money, you are putting yourself in what could likely be a very bad situation. At this stage in your life, you want to leave you IRA (Individual Retirement Account or non-U.S. equivalent) alone. It is especially dangerous to put yourself under this kind of emotional, physical and financial pressure during retirement as if you suffer bad losses, you probably won’t have a chance in life to recover from it. This is truly the number one factor you should be considering.

It must be emphasized that risk factors must to be taken extremely seriously at this stage in your life. Capital preservation must be the number one priority!

Emotional and Physical Health

You might not be at your peak physical health by the time you retire. Even though it is more than likely that you have all your wisdom and intelligence intact, you must be brutally honest with yourself and question how precisely you are going to be able to use technology under pressure. After all, trading is very unforgiving in the sense that even small errors can be very expensive, and cannot be reversed.

The good news is that there are some steps you can take in this area to minimize the risks. Firstly, you can trade using a slower system, perhaps relying upon daily, four-hour or hourly charts, which should enable events to unfold at a much more relaxed and manageable pace. This might reduce the room for errors to creep in. Secondly, you might also have a companion or helper who could provide a second pair of eyes to cast a look at your operations in the market. Thirdly, it is worth asking your broker about built-in safety measures that might be available for your protection. For example, some brokers have a feature where if you enter an unusually large trade size, it asks you to reconfirm the trade before proceeding. This type of safeguard can protect against “fat finger” mistakes. It is worth asking your account manager whether he (or she) could implement something informally for your account, for example by requiring telephone confirmation to make a trade over a certain size.

Forex Trading Strategies for Seniors

If you have weighed the pros and cons and have decided to go ahead, you need to decide what kind of trading strategy you will be using.

A trend-following strategy could be ideal as these are long-term strategies that don’t require a lot of physical effort or emotional stress.

If you insist upon taking advantage of the fact that you are master of your own time and you wish to look at shorter time frames, you might consider only trading major session opens. This could be 8am to 10am London time, New York time or Tokyo time, depending upon which time zone you are located in. Usually it is the London and New York opens that are the most fruitful. I once read a very convincing trading journal by a retired couple who decide what to trade that day and in what direction just before 8am London time, then they look for trade entries between 8am and 10am before continuing with their day. There is no reason why this couldn’t be the basis of an excellent and profitable Forex trading strategy for seniors.

Russian Oil Minister Signals Cooperation with Saudi Arabia on Production Limits

Russia’s oil minister signaled possible cooperation with Saudi Arabia at a meeting with his Gulf Arab counterparts in Riyadh on Sunday, as the kingdom seeks to convince major oil producing countries to cut production in order to increase prices.

After the meeting in the Saudi capital, Russian Oil Minister Alexander Novak was quoted in a ministry statement as saying that the parties had discussed specific production limits for Russia and other nations that may join the agreement, although he did not mention any figures or commitments from Moscow.

“We see the need to balance the market in the coming months to encourage the return of investments and the reduction of volatility,” Novak said.In a statement, Saudi Oil Minister Khalid Al-Falih also mentioned the need to “restore balance” to the market, where a surge in production globally has led to low prices that have weakened state coffers including that of the Saudis, currently engaged in a costly war in Yemen.

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Comex High Grade Copper Futures (HG) Technical Analysis

December Comex High Grade Copper futures continue to tread water shortly before the regular session opening. The market is trading slightly lower after an earlier rally failed to attract enough buyers to continue the move.
Most major players are on the sidelines ahead of the Fed’s interest rate decision on Wednesday. This decision is important to copper traders because it will affect the U.S. Dollar. The Fed is expected to leave interest rates unchanged in September, but may present a hawkish statement that supports a December rate hike. Because of this, we may see a two-sided trade in copper after the statement is released.

Technical Analysis

The main trend is up according to the daily swing chart. A trade through $2.1680 will signal a resumption of the uptrend with the main top at $2.2000 the next likely upside target. The uptrend is safe for now because the swing bottom is way down at $2.0640.

The main range is $2.2570 to $2.0640. Its retracement zone at $2.1605 to $2.1835 is currently providing resistance. A downtrending angle passes through this zone at $2.1695, making it a valid upside target also.

The short-term range is $2.0640 to $2.1680. Its retracement zone at $2.1160 to $2.1035 is the primary downside target.

The market is currently trading inside a downtrending channel. The top of the channel comes in at $2.1695. The bottom of the channel comes in at $2.1450. This channel is controlling the direction of the market.Breaking the support angle at $2.1450 could trigger a break into the next uptrending angle at $2.1240.

Taking out the resistance angle at $2.1695 could drive copper prices into $2.1835.

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Oil Surges After U.S. Crude Supplies Tumble the Most Since 1999

Oil jumped the most in almost five months after the biggest drawdown in U.S. crude inventories in 17 years.
Crude inventories fell 14.5 million barrels last week, the biggest drop since January 1999, according to the Energy Information Administration. A 905,000-barrel gain was projected by analysts surveyed by Bloomberg before the release. Tropical Storm Hermine moved into the Gulf of Mexico on Aug. 28, disrupting shipping and output before moving northeast. Imports tumbled 1.85 million barrels, while refinery activity increased.

“We had an enormous drop in imports, which explains the inventory number,” said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis, which oversees $5.2 billion. “Imports were off by almost 1.9 million barrels a day last week, which, when multiplied by seven, is pretty close to the size of the draw. I’m surprised the market is reacting as strongly as it is because there should be big build next week.”

Oil rallied in August partly on speculation that members of the Organization of Petroleum Exporting Countries and Russia would agree on measures to stabilize the market at a meeting this month. While Iran continues to keep investors guessing whether it will join a potential freeze accord, Saudi Arabia’s Energy Minister Khalid Al-Falih said Monday he’s optimistic producers will agree to cooperate. A falling dollar is also boosting the appeal of oil as an investment.
Storm Activity

West Texas Intermediate for October delivery rose $2.12, or 4.7 percent, to $47.62 a barrel on the New York Mercantile Exchange. It was the biggest gain since April 8, leaving prices at the highest close since since Aug. 26. Total volume traded was 38 percent above the 100-day average at 2:42 p.m.
Brent for November settlement climbed $2.01, or 4.2 percent, to $49.99 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude closed at a $1.73 premium to WTI for November delivery.

For a story on four scenarios for nations attending the Algiers talks, click here.
"The huge number is clearly a result of storm activity in the Gulf," said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. "It’s a fluke but, all the same, prices are going to move higher in the short term."
Late Arrivals
Delayed cargoes may be arriving this week, leading to a big import increase in the next report, O’Grady said. There were about 30 oil tankers waiting to enter the Houston Ship Channel as of 10:20 a.m. local time, according to Patrick Seeba, operations director at Greater Houston Port Bureau.
U.S. crude supplies declined to 511.4 million in the week ended Sept. 2, according to EIA data. Inventories reached 543.4 million barrels in the week ended April 29, the highest since 1929. The stockpiles remain at their highest seasonal level in more than 20 years.
"One data point does not a make a trend," said Mark Watkins, the Park City, Utah-based regional investment manager for The Private Client Group of U.S. Bank, which oversees $133 billion in assets. "We will have to see if this continues before getting too concerned."

Record Inputs

Refineries increased operating rates by 0.9 percentage points to 93.7 percent of capacity, the highest since November. Plants usually begin to cut back on operations in August as the peak-demand driving season comes to an end.
Refinery inputs of crude, natural gas liquids and other fluids into distillation units rose 1.6 percent to 17.3 million barrels a day, the most in data going back to 1989.
Gasoline supplies dropped 4.21 million barrels to 227.8 million last week, the lowest since December. Imports dropped 27 percent to 607,000 barrels a day, the lowest since April. Demand for the motor fuel rose 0.9 percent to 9.6 million barrels a day.
Stockpiles of distillate fuel, a category that includes diesel and heating oil, rose 3.38 million barrels to 158.1 million, the highest since April.
Gasoline futures for October delivery climbed 5.2 percent to $1.4165 a gallon, the biggest gain since May. October diesel rose 3.9 percent to $1.4822.

Oil-market news:

Iran is pumping 3.8 million barrels a day, Ghamsari said on Wednesday. The nation may continue boosting output beyond pre-sanctions levels.
Iraq’s oil production will continue to grow, rising as much as 150,000 barrels a day every year in the near term, Falah Al-Amri, the head of Iraq’s Oil Marketing Co., said Thursday.
Saudi Arabia told OPEC that its oil production dropped by 40,000 barrels a day in August to 10.63 million barrels, according a person with knowledge of the data, who asked not to be identified because the information hadn’t yet been made public.
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Gold Prices Reverse Course as Dollar Gains

Gold prices fell on Thursday after the U.S. dollar strengthened and the European Central Bank left interest rates unchanged.

Gold for December delivery settled down 0.6% at $1,341.60 a troy ounce on the Comex division of the New York Mercantile Exchange, reversing course after trading as high as $1,352.50 earlier in the session. The drop marked the second consecutive day of losses for the precious metal.

The ECB’s decision to keep rates unchanged sparked selling in government bonds and a rise in yields, which put pressure on gold prices, said Tai Wong, head of base and precious metals trading at BMO Capital Markets.

ECB President Mario Draghi “ kept his weapon in the holster today,” said Mr. Wong. “The higher interest rates created a little bit of a correction in gold.”

Higher interest rates tend to weigh on gold, which pays its holders nothing and struggles to compete with yield-bearing assets when borrowing costs rise.

The WSJ Dollar Index, which measures the dollar against a basket of other currencies, was recently up 0.3% at 86.13. A stronger dollar is typically bearish for gold, because it makes the dollar-denominated commodity more expensive for investors who hold other currencies.

The strength of the dollar has been a driving factor for the gold price for the past few weeks, acting as a signal for expectations on the timing of a future U.S. rate increase, said Carsten Menke, a commodities research analyst at Julius Baer.
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Comex High Grade Copper Futures (HG) Technical Analysis

Comex High Grade Copper traders shifted their focus from the bearish supply and demand situation to the weakening U.S. Dollar, driving prices higher on Wednesday. The rally actually started in London where prices rose to their highest level in two weeks earlier today in reaction to disappointing U.S. economic data on Tuesday. A lower dollar tends to lead to increased demand from foreign traders.
Short-sellers also reacted to the news that China may step up its fiscal policy efforts now that industrial metals prices are relatively low.

TECHNICAL ANALYSIS

The main trend is down according to the daily swing chart, however, momentum has shifted to the upside, following the formation of a new main bottom at $2.0695.
The short-term range is $2.2000 to $2.0695. Its retracement zone at $2.1350 to $2.1500 is the primary upside target. This zone falls inside the major retracement zone at $2.1290 to $2.1590, making it a valid target also.
Based on the current price at $2.1055, the direction of the market is likely to be determined by trader reaction to the long-term uptrending angle at $2.1090.
A sustained move over $2.1090 will indicate the buying is getting stronger. This could generate enough upside momentum to challenge a cluster of targets, including a downtrending angle at $2.1270, a long-term Fib at $2.1290, and a Gann angle/50% level combo at $2.1250. Since the main trend is down, we are likely to see sellers show up on a test of this resistance area.
A failure to overcome $2.1090 will indicate the return of sellers. This could lead to a retracement of the $2.0695 to $2.1190 short-term range. The major support angle comes in at $2.0705. This is followed closely by the main bottom at $2.0695. A trade through this level will signal a resumption of the downtrend.

Watch the price action and read the order flow at $2.1090. Trader reaction to this angle will tell us if the short-covering is continuing or if short-sellers are regaining control.    
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Commodities Round-up: Rise in US inventories weighs on oil futures

Oil futures remained in retreat mode for a second successive session on Thursday (1 September) as overnight US inventory data weighed on trading sentiment. At 2:17pm BST, the Brent front month futures contract was 1.11% or 52 cents lower at $46.37 per barrel, while the West Texas Intermediate fell 0.98% or 44 cents to $44.26 per barrel.

Data released overnight by the US Energy Information Administration said crude stocks rose by 2.3m barrels stateside to 525.9m barrels in the week to 26 August.

The rise exceeded market forecasts of an increase in the 700,000 to 825,000 barrel range, prompting an early oil market sell-off in Asian trading. The trading pattern became firmly entrenched when Europe opened for business, with dollar bulls also out in full force.

Members of the Organization of the Petroleum Exporting Countries (OPEC) are due to meet in Algiers on the sidelines of the International Energy Forum (IEF) on 26-28 September to revive global output freeze talks that stalled in April.

However, analysts remain sceptical of anything concrete emerging from the Algiers talks. In a note to clients, Commerzbank analysts said: "There is still lots of correction potential, given the overhang of speculative long positions and exaggerated hopes for an output freeze."

Nonetheless, speaking in Tokyo, Saudi Foreign Minister Adel al-Jubeir said OPEC and non-OPEC oil producers were increasingly moving towards "a common position, toward a common effort."

"If you want to have an impact then all of us have to shoulder the responsibility, and over the past five or six months, I believe that there has been an increasing realisation that this is a collective effort," he concluded.

Away from the oil market, the strength of the dollar dented confidence in major precious metals. At 2:39pm BST, Comex gold for December delivery fell 0.14% or $1.80 to a two-month low of $1,309.60 an ounce.

With a US interest rate hike back on the cards, analysts at Kitco Metals said more bad news was on the horizon for gold investors adding that "the path of least resistance continues to be lower." Kitco's view was echoed by analysts at Natixis who opined that a US rate hike could arrive as early as December.

Elsewhere, Comex silver slipped 0.03% or 2 cents to $18.71 an ounce. Concurrently, spot platinum was lower by 0.84% or $8.88 to $1,043.23 an ounce, completing declines across the precious metals market board.
Read more - https://www.goldcruderesearch.com/comex.php

USD/JPY Forex Signal

USD/JPY Signal Update

Yesterday’s signals were not triggered as there was no bearish price action at 102.83.
Today’s USD/JPY Signals
Risk 0.75%

Trades must be entered between 8am New York time and 5pm Tokyo time only, over the next 24-hour period.

 Short Trade 1

Short entry following a bearish price action reversal on the H1 time frame immediately upon the next touch of 103.96.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.

Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.


Long Trade 1

Long entry following a bullish price action reversal on the H1 time frame immediately upon the next touch of 102.21.
Put the stop loss 1 pip below the local swing low.
Move the stop loss to break even once the trade is 20 pips in profit.

Remove 50% of the position as profit when the trade is 20 pips in profit and leave the remainder of the position to run.

USD/JPY Analysis

I was right yesterday to not be looking to get short just yet. The pair continued to rise strongly and made even higher new highs around the Tokyo close earlier, although it may be cooling off now.

The long-term trend is still bearish but it is being called more and more into question and it seems that the momentum for the short-term is still bullish as that is the way sentiment on the USD is inclined.

Much will now depend on the forthcoming U.S. economic data releases. If they are better than expected, we can expect further healthy upswings. If much worse, then this pair will probably top out and begin to fall.
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A Stronger Dollar Pressured Gold on August 30

Gold was stable in the early morning hours on Tuesday, August 30, but fell during the day under the weight of a stronger dollar. At 1:35 PM EDT on August 30, the COMEX gold futures contract for December delivery was trading at $1,315.85 per ounce, a drop of ~0.85%.

The COMEX silver futures contract for September delivery was trading at $18.56 per ounce, a drop of ~1.1%. Please read How Did Copper, Gold, and Silver Perform Early on August 30? to see how metals traded early on Tuesday morning.
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Markets are sending mixed signals on the Fed

The US dollar is advancing the theme of a hawkish Fed today but other markets aren't sending the same signals.The S&P 500 fell on Friday on worries about higher rates but the stock market has bounced back today. It's up 8 points to 2177.


Importantly, the S&P 500 is back above where it was before the Jackson Hole speakers started.In the bond market, two year notes are a good indication of what the market is thinking about the Fed. The reversal hasn't been as dramatic as stocks but US 2s are down 2 bps today to 0.8250% after hitting 0.8447% on Friday.
What will make the signals even more skewed in the coming days is that it's month end so flows could push the correlations out of line.
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