Below are some absolutely stunning charts. Meanwhile the stock market rally is over and gold will benefit as inflation continues to rampage.
Electricity Prices Out Of Control
August 23 (King World News) – Javier Blass, energy and commodity columnist at Bloomberg: MAP OF THE DAY: Day-ahead electricity prices in Europe are eye-watering, with lots of countries setting record highs for today. Notable to see the Nordics close to €400 per MWh, and Germany at €600. Before 2020, anything above €75-100 was considered expensive
Electricity Prices Continue To Skyrocket In Europe
Anything Above €75-100 Was Considered Expensive
Prices Are Now “Eye-Watering”
Who Will Pay The Bills?
Javier Blass, energy and commodity columnist at Bloomberg: And tomorrow, the price of electricity in the Nordic countries (Nordpool system daily average, day-ahead) will surpass for the first time ever the €400 per MWh barrier (that’s up from an average of ~€32 per MWh from 1996 to 2021)
Electricity Prices In Nordic Countries
Continues Shattering Records!
This Is Insane
Holger Zschaepitz: OOPS! German benchmark electricity price jumped >25% on Monday to pass €700 per megawatt-hour for the first time. The level is about 14 times the seasonal average over the past five years.
German Electricity Prices Pass €700
Per Megawatt-Hour For First Time!
Stock Market Rally Over, Gold Will Benefit
Fred Hickey: Steep (thanks to quants) stock bear market rally is over. Trap door is shut (just in time for Sept-Oct). Rising US dollar causing havoc globally – especially in emerging markets). Interest rates rising (including long-term). Nat gas soaring. Oil prices may follow (2% inflation dreams vanish).
Markets breaking down globally as Fed tightens further. Liquidity squeezed (Fed QT just beginning and up till now has been more -much more- than offset by US Treas. TGA reductions (injected liquidity – but now over). Glad to have ratcheted up my put options vs tech.
Meltdowns will put Powell’s and rest of Fed blowhard’s “hawkish” talk to the test. My bet is that under pressure, they’ll show their true dovish leanings. That will be bullish for the precious metals and they’ll outperform – as they did earlier this year during the stock market selloff…
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Cashin Says Bulls Trying To Circle The Wagons
Art Cashin, Head of Floor Operations at UBS: The bulls are trying to circle the wagons, taking advantage of a very mildly oversold condition and, I do mean mildly. Plus the fact the yield on the ten-year has dipped back a couple of basis points to be flat at 3%. Above 3% is the danger area, obviously. That having been said, the bulls clearly are struggling a bit. This could be a consolidation day, at least that is what the form chart suggests after two days of rather aggressive selling.
We didn’t get into 90% down days, but we came awfully close and that is what gives this very mild oversold condition. I think the game clearly is all about the yields and the stock market may move with every basis point tick that we see. The news is uninspiring. The housing market clearly is showing signs of suffering, but that has not been a factor in the weakness, which has clearly been about yields and concern about a global slowdown. Oil is holding its own despite the continuing concern about the global slowdown.
So, a further tick up in oil and/or yields can keep the bulls off balance.
Let’s look at some of the numbers.
The S&P did make a fractionally lower low this morning than its intraday low of yesterday, but on further weakness, I would watch the 4110 and, especially if we break below the psychological 4100. Keep watching the yield on the ten-year, which so far has waffled tightly around the 3% area. Moves above would put pressure on equities. Moves below might provide a bit of a bid. The general sense is that everybody will now start waiting for Jackson Hole to see what happens on Friday.
The bulls hope to just hold their own. If we see further erosion going into Friday, it may make things tough depending on what kind of linguistic miracle Powell hopes to maintain .
Stay nimble, alert and please stay safe.
Yet Another Inflation Catalyst
Top Citi analyst Tom Fitzpatrick: As we have noted recently, despite the breaks of good weekly supports seen on WTI three weeks ago there has been no follow through since then.
This, together with the charts below suggests to us an increasing danger that a bottom may be forming here for now and that a bounce back over $100 in the relatively near future may be a danger.
WTI Daily Chart
On the daily chart we see:
Positive momentum divergence
2 possible double bottoms — one at $92.09. A Break of this range (happening now as wet speak) suggests extended gains towards $97+. The other one is at $95.05. A break of this range would significantly extend the potential of t his move suggesting as high as $103+.
EXPECT MORE INFLATION PRESSURES:
Look For A Big Rally In Crude Oil
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One Of The Most Important Interviews Of 2022
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