One Year Later, Little Change!
When thinking about what to write today, I started thinking about everything that has happened in the markets the past year.
My main impression I had in my mind was:
The USD has strengthened a great deal the past 12 months (correct)
Gold and Silver are higher than 12 months ago (wrong)
Crude Oil is lower than 12 months ago (basically unchanged)
The global equity markets, in general, are lower than 12 months ago (basically unchanged)
My general view, before looking at the facts, also was that interest rates in the U.S. are higher (partially correct)
Interest rates for everywhere else were relatively unchanged compared to a year ago
The period from the end of February 2018 to now, was full of volatility, Stock markets setting new highs and a large correction, plenty of political uncertainty and important trade issues, followed by a rally in the first 2 months of 2019.
Feb 2018 Feb 2019
USD Index 90.50 96.50
DJIA 25,525 26,000
NASDAQ 7,400 7,500
ESTOXX 50 3,070 3,040
S&P 500 2,770 2,780
OMX Helsinki 4,170 4,070
OSE All share 917 985
Nikkei 22,300 21,500
Gold 1,365 1,330
Silver 16.75 16.10
Copper 315 297
Crude Oil 58 57
Nat Gas 2.65 2.78
U.S. 2 year 2.27% 2.5%
U.S. 10 year 2.89% 2.67%
EURNOK 9.70 9.74
For the most part the only significant change of the above, is the USD. The story behind that is that the Fed has hiked rates which has given the currency support.
In addition to the Fed there has been significant repatriation of funds from overseas back to the U.S. by large corporations and the fact that for most of 2018 the U.S. equity markets outperformed the rest of the world. Growth in the U.S. outperformed most major economies.
Platinum: used primarily in jewelry and autos, is 15 to 20 times rarer than gold based on mining production numbers. Has also broken resistance and looks to test higher.
We will look for a test of the earlier resistance levels to enter long positions, the question for our long gold position is will the above draw attention away in the short term?
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– Mark W