US open – Markets, US data, gold, oil, bitcoin

Another Forgettable Day

This week always promised to be very quiet and it’s not disappointing, with Europe trading marginally higher and Wall Street poised for similar gains.

Source – Thomson Reuters Eikon

The sudden daily obsession with the trade war probably has a lot to do with the fact that there’s very little else to talk about at the moment, which doesn’t bode well for the rest of the year. Of course, that may change if a deal gets over the line but, let’s face it, we’ve been “close” to that for much of the year.

The trade war has taken the place of the Fed in being what investors are hanging their hat on. We’re basically in limbo, it’s neither clear that we’re close to a deal or on the verge of collapse because the final issues are too difficult to overcome. Washington and Beijing clearly want us to believe the former but then, it was meant to be signed by now.

Here in the UK, there’s plenty of election coverage, too much actually. There’s only so many more times I can hear Boris say “get Brexit done” before I just turn the TV off until 10pm on election night. Sterling dipped slightly on Tuesday in response to Labour gaining in the polls but that’s about as much action as we’ve had so far.

Strong start on US data releases

There is a flurry of US data to look forward to today, with the first releases giving the dollar a boost. GDP for the third quarter was revised higher to 2.1%, a decent result under the circumstances, as the economy continues to outpace many of its peers. Durable goods orders were also ahead of market expectations while jobless claims rose on 213,000, well below forecasts.

There’s plenty more still to come including personal income and spending figures and core PCE price index, the Fed’s preferred measure of inflation. After this, if it isn’t already, the Thanksgiving break may well be underway.

Gold vulnerable at $1,440

It’s been another quiet day in the commodities space as well, with gold off around a third of one percent, basically being hampered by the marginally positive risk appetite. Prices rebounded on Tuesday but the yellow metal continues to linger around its recent lows and looks vulnerable to another break to the downside, with $1,440 being key. A break below here could be interesting, with $1,400 then being key.

Gold Daily Chart

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Oil grinds higher but still lacks momentum

Oil prices are a little higher again on Wednesday, very in-keeping with the slow grind we’ve been seeing recently. This may be a symptom of the quiet environment at the moment or a market that’s simply overbought so struggling to gather any upward momentum. Both of these are probably true based on recent evidence. Inventory data later today may spark some interest although that was short-lived on Tuesday, when API released its figures.

Brent Daily Chart

Bitcoin pares November losses to just 20%

When all else fails, bitcoin is always there to show us where the real moves happen. It’s a pretty quiet day by its standards and still it’s up more than 2%, reducing losses in November to just 20%. Recent disclosures by the PBOC have clearly shaken the market and cast further doubt on whether China will ever adopt cryptocurrencies or just use the technology its based on. Unfortunately for bitcoin enthusiasts, the latter is looking far more likely, and not just when it comes to China.

Bitcoin Daily Chart

Source – Thomson Reuters Eikon

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