Posted on 05/01/2013 7:30:15 AM PDT by blam
The Commodity Massacre Is Back Today — Gold Tanks Again
Matthew Boesler
May 1, 2013
WTI crude oil is getting hit pretty hard this morning. Right now, it's down about 2.8%, trading at $90.85 a barrel.
Copper is getting hit too – it's down about 3.2%.
Gold, meanwhile, is down 1.5%, trading at $1450 an ounce.
In fact, the entire commodity complex is pretty heavy in the red today, with the exception of natural gas. Silver, platinum, palladium, corn, wheat, sugar, coffee, soybeans, gasoline, and heating oil are all coming under selling pressure.
Overnight, we saw weaker-than-expected manufacturing data out of China and weaker-than-expected export data out of South Korea. Those releases, coupled with a worse-than-expected employment report from ADP this morning, seem to be weighing on commodities as concerns over global growth re-ignite.
Next up is ISM Manufacturing at 10 AM, which could weigh further on commodities if it comes in weaker than the market expects.
The chart below shows WTI crude oil futures today.
(Excerpt) Read more at businessinsider.com ...
Buy when it hits 1,250. Just my two cents.
I am sure SAJ will be able to cite bigger /CL moves than this, but this is pretty big!
The story is copper. IMHO, this is actually bullish for gold...gold should be down $50-60 if it was really correlated to the commod complex. $20-25 down? Bah!
For crying out loud.
The real question is if/when the American dollar tanks and people will feel a lot better then with their commodity investments. The rest is just noise.
Are bonds rising, counter to what happened on Patriots’ Day?
I am a big fan of commods, but you can’t be all the way into gold (thinking the USD is toast) or guns or toilet paper. There will be opportunities to buy things on deep sale with green cash.
And...with all the talk about a weak dollar, it has been VERY strong of late since the yen has devalued so badly.
I always insert my cautionary warning against the “dollar is going to hell” thing. It is NOT so. One day, it may, but it is not responding to ultraprinting like one might think.
But the copper chart, again and again and again...tells an ominous story.
Oil futures down almost $3.
How can I say this? Easy. In the great crude crash that started 20 August 2008, crude dropped more than five per cent in a single day not less than 12 separate times between 20 August and the end of the year. The largest single-day drop was 8.74% on 9 October.
Now, should crude continue its slide -- and if the economic numbers keep coming in so horribly, this is quite possible -- at some point we will see a day or two of capitulation selling, whereon the traders just say "MARKET!" and take whatever price they're given. On such days, I should not be at all surprised to see a 7-8% daily drop.
For this commentary, I only analysed the June futures, which are the "front-month" at this time. Nevertheless, it is essentially inarguable that, on crash days, the behaviour of prices all across the strip was more or less identical.
I agree with ASD that copper is telling us more about the state of the world economy than crude. As noted in a previous post, we have a simply untold supply overhang, particularly in China. I should imagine that copper prices over the next 6-12 months will venture considerably lower.
No view on gold prices, because that mkt is supremely manipulated and price signals of the "ordinary" sort have been invalid for some time.
Good trading to you!
It’s Fed Day today. I don’t expect any unexpected news to come out of their announcement, but Da Boyz often take advantage.
OTOH, they tried to take the general stock market to new highs this morning, on top of yesterday’s rise, and they failed at that.
The good news is that I just got my fuel oil bill this morning when they filled my tank, and the price was way down from the last delivery. I’ll take that, thanks—although no thanks to Bammy, who tries to increase it every chance he gets.
Interesting comment on Gold market being manipulated. IMHO, is it Soros, Buffet, et al? I will go to my grave knowing that the huge drop in the market mere days before the 2008 election was also manipulated - by Soros. He did it to Britain and he’s an evil person.
If some don’t know George Soros...... look him up.
Noting the discussions over the previous months about metal versus paper, I wonder if the recent gold finds in an Egyptian bay (metal!) have any bearing on today's fall. Sounds like a lot of ships and potentially a lot of gold.
what is your bloomberg id? Im dcbryan1@bloomberg.net
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2013/5/1_Embry_-_This_May_Create_A_Massive_Upside_Breakout_In_Gold.html
The real question is if/when the American dollar tanks and people will feel a lot better then with their commodity investments. The rest is just noise.
............
Ain’t gonna happen.
Not with the oil patch adding nearly 1 million barrels a day this year of oil production—and predictions of similar growth for the next seven years or so.
Still looks like “panic buying” to me. /s
Once again, I’m glad our currency isn’t tied to this shiny metal.
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