Loading ...Commodities ?
Commodities have been in a brutal bear market …culminating in a massacre during the Covid Crash in March
Lately they have been rebounding in a V like recovery…Big Question do they have legs or is this just a dead cat retest ?
It’s the Old Inflation vs Deflation Debate.
$CRB Monthly Resistance starts here…downsloping 50 MA is tough resistance too.
Dr. Copper Up 8 out of 9 months …looks like a repeat of the v bounce out of the GFC in 2008. Copper likes The Printing Orgy…
$WTIC ( OIL) …Good old fashioned liquid Energy from Fossils ( remember that ? )
Hell of a rebound from ZERO for a commodity they want to make obsolete..
Steel…BIG Move THIS Month
AGRICULTURAL COMMODITIES
This is the one to watch IMO
On the verge of a potential breakout
LITHIUM
WOW…We took our Eye OFF this ball and Bam !
the old inflation deflation question. Depends which side of the currency you are on, shortage cause, demand and gov’t regs to push prices up. Covid causing supply chain issues and hoarding causing the shortages of food etc. Now garlic on the chopping block
The current situation in the global garlic market is going very badly, according to Danny Deen of Denimpex. “The Spanish harvest of approximately 110,000 tonnes has been reduced by approximately 45% and what is still available is not of top quality. A lot of garlic has been affected by nematodes. It looks like the long-term contracts cannot be fulfilled because the long-term storage is not stable in terms of quality.” “China has had a large and good harvest in terms of quality and size, but also has a lot of demand and a lot of export to the whole world. Because the global harvests are all disappointing and there is a lot of demand from North and South America, prices are rising. Chile, Argentina and Mexico will soon reach levels that are far too high for the European market,” notes Danny. “We expect that when the cold really sets in in the EU, the current stocks the importers have will run out very quickly and a shortage will arise.” Summer supplies have been sold much faster than normal and new arrivals are much more expensive from China, as freight costs have more than doubled and prices in China have already risen by about 50%. Large positions have once again been taken by local speculators in recent months and are now unwilling to sell until after the Chinese New Year, as speculators expect the price to be the same as last season. That means that there could be another 50% price increase for garlic in China. ” “At the moment there is also a big problem in terms of container availability, because there are 3.5 times as many export containers as import containers. Furthermore, the Chinese currency is deteriorating against the US dollar. In the EU we also still have the issue that garlic from outside the EU needs a quota and there is already a shortage of it, so who knows, who knows, but this season could still take a very strange turn,” Danny concludes.
Read more at: https://agroinsurance.com/en/eu-once-the-cold-weather-really-hits-garlic-stocks-will-soon-be-gone/
No doubt all the money created around the world in 2020 is gong to drive inflation particularly in commodities. The trends in electric vehicles, continued rollout of solar and 5G will drive copper for next few years at least.
And the best way to play it on a royalty basis IMHO is Altius:
https://stockcharts.com/h-sc/ui?s=ALS.TO&id=p09061825205&listNum=43
Two others:FCX and SCCO
Graddhy is still predicting the greatest commodity bull of all time, with commodity stocks up 15 to 30 times present prices.
Yes for going on 5 years now 🙂
Watching this sector closely.
EW probably sees the spring collapse as a 3rd wave down within the final decline.
So at least in energy, where I think the waves are fairly clear, this rally is likely c of 4 (deadcat retest).
5 of 5 in the spring should conclude the bear.
I’m also suspecting that the 40yr bond market bull will end at the same time.