Domestic energy companies

Domestic energy companies collectively saw 9 rigs taken off line last week which was the largest weekly reduction in over two years as concerns around over-supply begin to set in despite a larger than expected draw last Wednesday. Crude Futures (/CL) are essentially flat just below the $69 a barrel mark with the heaviest driving season quickly coming to an end. The 10 year Treasury has dropped near the 2.815% mark this morning with general applauds surrounding FOMC Powell’s comments out of Jackson Hole last week in a call to gradually reduce rates. There have now been seven rate hikes completed since the financial crisis with two of those occurring just this year. Analysts believe we will see the same number by year’s end should the market continue at the current pace. 

S&P 500 (SPX) 8/24

The S&P 500 (SPX) moved lower as the U.S. and China engaged in a second day of trade talks.  $16 billion of tariffs were put in place early yesterday on a wide ranging list of items, spanning Chinese machinery and chemicals to U.S. engines and fish meal.   Robust corporate earnings and strong economic numbers have helped the S&P 500 rise more than 5% since the end of June, putting it on pace for its best three month stretch of the year.   According to analysts, tariffs have not had a severe negative effect on corporate profits, so far.  Minutes from the latest Fed meeting show that trade tensions have risen to the top of the central bank’s list of concerns.  

U.S. crude oil futures 8/22

U.S. crude oil futures (/CL) are up nearly 1.8%, and are on track to make their fifth consecutive gain as a drop in U.S. oil inventories and a sliding dollar have helped propel oil to trade near $67 a barrel.    Gold (/GC) has also benefited from the weakening dollar and increasing political uncertainty.  Gold futures are up 0.4% this morning, and are trading near $1205 per troy ounce.    Existing Home Sales and the FOMC minutes will be the highlight of today’s economic reports.  Investors will be looking for clues in the minutes for direction on interest rate policy going forward.  As of this writing,  S&P 500 futures (/ES) are 0.2% lower near 2857 and 30yr. Treasury bonds (/ZB) are 0.3% higher near  145’19.

Canadian dollar 8/21

The Canadian dollar has posted small gains in the Tuesday session, continuing the trend seen on Monday. Currently, USD/CAD is trading at 1.3023, down 0.16% on the day. In economic news, Canada releases Wholesale Sales. There are no U.S events on the schedule. On Wednesday, Canada releases retail sales reports, while the U.S will publish Existing Home Sales. As well, the U.S releases Existing Homes and the Federal Reserve will publish the minutes of the July policy meeting.
Will USD/CAD drop below the symbolic 1.30 level? The Canadian dollar has been moving higher since Friday and could drop below 1.30 this week, for the first time since August 7. It’s been a rough August for the Canadian dollar, as the escalating trade war has dampened risk appetite and hurt the Canadian dollar, which is a minor currency. However, the announcement that the U.S and China will hold trade talks in Washington later this week have raised investor confidence and boosted the Canadian currency. If the talks show signs of progress, such as the suspension of a $16 billion tariff scheduled to take effect on August 23, then the Canadian dollar rally could continue.

U.S. crude oil prices

U.S. crude oil prices rose on Friday on the prospect of better relations between the U.S. and China.  September futures (/CL) rose 0.7% to $65.91.  Light sweet crude has been weighed down by signs of weaker demand, the Turkish currency crisis, and a stronger dollar, which helped oil futures drop 2.5% on the week.  After setting a new 52 week low on Thursday, Gold (/GC) has found some footing over the past two days and is currently trading near $1194 per troy ounce.

Starbucks (SBUX)–

Creamed!– The popular coffee retailer announced its longer-term strategy yesterday which includes the closing of 150 company-operated stores. The alarming trend hints that growth may be topping despite trying to enter new markets like China. Same store sales are expected to dip by 1% in the current quarter as the recent negative publicity may be taking its toll. On a bright note, the company will hike its dividend by 20% to $0.36 a share. SBUX shares took a 3% hit after-hours to slip into the red for 2018. 

Changing your trading style

In fast moving markets this will happen especially if news has broke that influenced the direction of the market.  Stock and forex trading is risky so the losses you take should be small if you stick with a solid trading plan and know where to set stop losses. Changing your trading style from hitting the buy button and sell button and moving in and out of positions will lose you money in the long run. You need to look at your position and adjust your buy and exit strategies accordingly. As a trader, you are not guessing on where the trade might be going whether it is a long or short trade, so you are not taking a risk it is not gambling it is a well thought out trade.

 A profitable forex or stock trader mental attitude is most important. They have to have a positive outlook on all their trades. This will make you a successful and profitable trader. One of the important parts of not having to many losing trade is the technical analysis and reading your charts correctly. Experienced traders and investors in the markets must use technical analysis as part of their trading program.