Daily Morning Report

Monday, December 11–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly higher overnight. U.S. stock indexes are also pointed toward firmer openings when the New York day session begins. There continues to be a general “risk-on” trading attitude in the world marketplace that is boosting equity markets.

It’s a big week for economic events, as monetary policy meetings of the U.S. Federal Reserve, the European Central Bank and Bank of England take place this week.

The focus of many market watchers early this week is the launch Sunday evening of bitcoin futures on the U.S. Cboe exchange. Reports said initial trading saw high volatility with circuit breakers kicking in to try to reduce volatility. Some trading interruptions occurred due to heavy participation, reports said. The CME Group introduces its bitcoin futures trading next week.

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There’s an old market adage that says when the general public catches wind of a big market move occurring, that move is likely nearing its final stages before reversing its price trend. The Bitcoin publicity craze currently playing out in the world marketplace certainly fits into that old market saying.

There is also ongoing speculation among market watchers on the recent price pressure in the gold and silver markets being due in part to the keener trader/investment interest in Bitcoin as a safe-haven asset or store of value.

Most veteran market participants would question whether any investment asset whose price has been so volatile could be considered a stable, long-term investment vehicle. That being duly noted, no one can deny the skyrocketing interest in and value of Bitcoin. Reports today said the total value of Bitcoin now exceeds the total value of most of the world’s largest individual investment banks.

Whether bitcoin can ultimately compete with such historical safe-haven stores of value like hard assets, including the precious metals, remains to be determined–but not in the coming days, weeks, or months; rather in the coming decades.

Ironically, the recent extreme daily volatility and skyrocketing value of Bitcoin could wind up working in favor of the gold market bulls. Here’s a scenario that is within the realm of markets reality: The spike in bitcoin prices continues for a while longer, with more and more novice investors pouring their money into a seemingly sure bet. The total value of bitcoin owned by the world’s investors is becoming big enough to rattle other markets when the bottom finally does fall out of bitcoin–or even if the cryptocurrency just sees a sizable downside correction, which is certainly overdue at present.

If and when such a scenario occurs, guess where the scared money is going to flock? It won’t be into other cryptocurrencies, but most likely into the safe-haven metal that’s been a de facto currency for much of
humankind: gold.

Friday, December 8–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly higher overnight. U.S. stock indexes are also pointed toward firmer openings when the New York day session begins.

There was upbeat economic data coming out of China and Japan overnight, to help boost Asian equities. China’s November exports were up 12.3%, year-on-year, which is double the rate that was forecast. November Chinese imports were up 17.7%, better than the 12.0% rise that was anticipated for November.

The European Union and the United Kingdom have finally reached an agreement on Brexit, which buoyed European stock markets and the British pound.

The U.S. economic report highlight of the trading week will be Friday morning’s November U.S. employment report from the Labor Department. The key non-farm payrolls number is forecast to be up 195,000. Wednesday’s U.S. ADP national employment report for November showed a rise of 190,000 jobs.

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Thursday, December 7–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

World stock markets were mostly higher overnight. U.S. stock indexes are pointed toward firmer openings when the New York day session begins.

Gold prices are lower in early U.S. trading and hit a more-than-four-month low overnight.

Traders and investors are monitoring U.S. government lawmakers’ negotiations with President Trump over a stop-gap measure to keep the federal government in operation. It’s expected the stop-gap funding bill will be implemented later this week.

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The gold market on Tuesday slumped to a four-month low. The keener “risk-on” trader/investor attitudes in the marketplace the past few weeks has seriously dented the safe-haven metal. Some more price pressure is likely in the near term. If the world equity markets continue to push to record or multi-year highs, gold will continue to suffer. However, when the world stock markets see their very mature bull runs come to an end–and they most certainly will at some point–then hard assets like gold and silver will benefit significantly. Stay tuned!–Jim

Wednesday, December 6–Jim Wyckoff’s Morning Markets Report

OVERNIGHT DEVELOPMENTS

While world stock markets were mostly lower overnight, U.S. stock indexes are pointed to weaker openings when the New York day session begins. Asian stock indexes led the declines, amid worries about China’s economic growth prospects. A big drop in copper prices this week has also spooked equity market traders.

It’s a bit of a “risk-off” trader/investor mentality in the marketplace at mid-week. Safe-haven gold and U.S. Treasury prices are trading up as the world equity markets are under selling pressure.

The key “outside markets” Wednesday morning see the U.S. dollar index slightly lower. Nymex crude oil futures prices are also weaker early today.

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