Posts by Adam Baratta

What is Oil Telling the Markets?

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The last several weeks have seen renewed stock market volatility as investors contend with the ongoing trade war with China, rising rates and the highly anticipated midterm elections. The elections have now come and gone, however, the other factors remain a source of concern for investors. With so many potential distractions, it is easy to see why recent price action in the oil market has not gotten too much attention. Although the market’s recent slide has been mentioned here or there, the recent declines could... Continue Reading

Gold Rockets Higher Despite Stock Rebound

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Gold is climbing sharply higher today as an improving technical posture, weaker dollar and disappointing data fuel buying interest. In what seems to be a recent trend, the latest reading on ISM manufacturing came in below expectations. Although the reading was still solid, the slightly lower gauge could potentially point to weakening economic growth. Other key data points in recent weeks have also shown a tendency to come in slightly below consensus estimates, and if the recent trend does continue it could start to raise... Continue Reading

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Don’t Fight the Fed, but Don’t Ignore It Either

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There is an old saying that says “Don’t fight the Fed.” This saying is typically directed at stock market bears that remain bearish equities even as the central bank lowers rates or maintains ultra-low levels of rates that encourage risk taking. The phrase happens to make a great deal of sense, as the Fed is essentially the most powerful financial institution that there is. The Fed has the power to control the money supply, and to “create” new money out of thin air. If the... Continue Reading

Are Stocks Ready to Really Roll Over?

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It was supposed to be a bright day for U.S. stock markets. Both China and Europe were higher in previous sessions and U.S. markets appeared early on ready to follow suit. The gains in U.S. equities evaporated quickly, however, and markets are now trading decidedly lower. Chinese markets have been a major topic of speculation and concern in recent months. The benchmark Shanghai Composite index has lost around a quarter of its value since the beginning of the year. Worries over slowing growth in China... Continue Reading

Strength Despite Strength

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The gold market has been showing some important signs of strength in recent action. The market has moved sharply higher in a short period of time, and is hovering around a 10 week high. Overall sentiment around the gold market seems to be improving and the market is also now on more sound technical footing. Of particular note today is the fact that gold is higher again despite stocks being sharply higher as well. Stocks are not just slightly higher, either. As of this post,... Continue Reading

Is A Tipping Point At Hand?

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In early action on Wednesday, the stock market is getting hit once again, and hit hard. Rising bond yields remain the object of blame for today’s sell-off, and the market is showing some significant signs of cracking. The selling seen last week and thus far today could simply prove to be a small taste of the potential carnage ahead. Higher yields are creating competition for stocks, which have enjoyed a significant, decade-long run due in no small part to a lack of viable alternatives. Given... Continue Reading

A Shot Across the Bow

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Stocks are getting hit today, and hard, as rising bond yields fuel selling in equities. The recent concerns over higher yields-which are trading at multiyear highs-is only one issue that stock investors will need to contend with in the months and years ahead. None of this is to say that stocks cannot keep going higher, in fact, stocks may very well see a fresh leg higher and new all-time highs going into the end of the year. Once the levee breaks, however, look out below.... Continue Reading

Has the Dollar Gotten Ahead of Itself?

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The latest meeting of the FOMC has now come and gone. As expected, the Fed continued on its recent course of policy normalization, hiking the Fed Funds rate by another 25 basis points. The central bank still expects to hike rates again before the end of the year, likely in December. There were some key changes in the policy statement, with the central bank electing to drop the term “accommodative” from its statement. Rate expectations going forward also changed as well, and it seems overall... Continue Reading

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A Win-Win Situation

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The recent surge higher in both stocks and economic growth may very well be unsustainable. In fact, it seems that an increasing number of analysts and prominent investors are now sounding the alarm bells about what could be seen economically next year or the year after. This could potentially put gold into a win-win scenario. Here’s why: Slowing Growth and/or Recession: The economy is, without question, humming along at what is arguably an excellent pace. Jobless claims are the lowest in nearly half a century,... Continue Reading

Two Major Factors

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The gold market remains relatively quiet in recent action as the metal tries to hold support around the $1200 level. The bulls have not had much to cheer about in recent weeks, as higher stocks and a stronger dollar have taken a toll on sentiment. When it comes to financial markets, however, things can and do change in a hurry. That said, there are two potential events on the horizon that have the potential to drastically change the outlook for not only gold but other... Continue Reading