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Commodities Trading Ideas & Charts

Drop in Crude Stockpiles is Causing Oil Future to Settle Higher

August West Texas Intermediate Crude oil futures closed at $72.94 a barrel, up $0.74 or nearly 1%.

Brent crude futures were trading at $74.19 a barrel, up $0.76 or 1.03 percent.

Crude stocks in the United States declined by 6.866 million barrels last week, significantly more than the predicted reduction of 4.03 million barrels, according to data issued by the US Energy Information Administration (EIA) this morning.

Distillate stockpiles surged by 1.616 million barrels last week, much exceeding the 171,000 barrels projected gain, while gasoline inventories fell by over 6 million barrels, about three times the predicted reduction.

According to a report released late Wednesday by the American Petroleum Institute (API), oil stocks in the United States decreased by 8.0 million barrels last week.

Since demand fell during the corona virus outbreak, OPEC+ has been limiting supply for more than a year. Investors are now concerned that the lack of a new supply agreement will force big oil producers to ramp up output much more quickly.

(Source: Rtt News)

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

Ethereum Emerging As the Next Big Crypto

Bitcoin’s popularity seems to be going down

Bitcoin is viewed as a gold substitute, but Ethereum is viewed as a supercomputer upon which additional crypto’s can be built. Ethereum’s designers have already stated that they are working on a more energy-efficient successor to the cryptocurrency, which might be released later this year.

The more interesting fact here is that, while the number of active Ether addresses has increased, the number of active Bitcoin addresses has decreased. This indicates that Bitcoin investors are considering alternative crypto currencies as long-term investments.

Reasons for the decline in Bitcoin’s popularity

Some possible explanations include China’s restriction on Bitcoin mining and environmental concerns highlighted by a number of people, including Tesla CEO Elon Musk, who confirmed that his company will not accept Bitcoin payments until it becomes more energy efficient. Neither Musk nor Tesla, on the other hand, have sold any of their Bitcoin holdings thus far.

Crypto aficionados remain optimistic that Bitcoin will recover from its present lows, as it has in the past. The coin has been around for nearly a decade and has shown to be durable. This is the first time it has been challenged by another cryptocurrency. It will also be intriguing to watch if Ethereum can keep up the momentum it has gained in recent days.

(Source: India Today)

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

AUD/JPY Price Analysis: Bear Maintains Control below 83.00

For the previous two weeks, the AUD/JPY has been trading in a price band between 82.80 and 84.20 on the daily chart.

Daily candle stick chart Price action

If price falls below the intraday low of 82.69, it may try the 82.50 horizontal support level before testing the June 21 low of 82.13.

With a bearish crossover, the Moving Average Convergence Divergence (MACD) indicator is in the oversold zone. Any drop in the MACD could amplify the bearish trend.

Bears in the AUD/JPY would look to test the 81.99 level, which was reached on February 26.

Alternatively, if price reverses course, it might return to the 83.00 horizontal resistance level, then to the 83.35 high set on June 30.

A daily close above 83.35 would allow the 83.50 horizontal resistance area to open up.

(Source: FXSTREET)

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

AUD/USD rises to the 0.7500 area after Federal Open Market Committee minutes

Minutes contain no noteworthy surprises.

According to the minutes, Fed officials believe the criteria of “substantial further progress” required to change monetary policy has not yet been satisfied. Several FOMC members stated that they expect the pace of asset purchases to slow down and those criteria would be met sooner than expected.

Following the minutes, the US dollar retreated across the board, wiping off the previous day’s gains. The DXY fell to the 92.50 level, turning negative. US yields are still hovering around daily lows. The 10-year note is currently trading at 1.31 percent, its lowest closing since February 18.

Short-term Outlook

With the price well below the 20-day simple moving average, the AUD/USD remains negative (SMA). The pressure will be relieved if the Aussie recovers over 0.7540, and it will rise above 0.7600/05. The 0.7560 area, where the 20 and 200-day SMAs intersect, will be a key milestone to watch.

The key support, on the other hand, is at 0.7455. A break below 0.7400 would pave the way for additional losses, with the initial target being around 0.7400.

(Source: FXSTREET)

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

Despite India’s lowest coronavirus mortality since April, the rupee bears recover 75.50

Even as the death toll in India declines, market mood dwindles amid covid troubles

The official covid data for India, obtained from the Health Ministry early Monday, indicated a 39,796 daily increase in coronavirus infections, bringing the total to 30.59 million. The bulletin also cites 723 covid-related deaths the day before, the lowest number since April 2008, bringing the overall number of fatalities to 402,278.

Statements from Barclays and Nomura predicting an increase in the current budget deficit could also be fuelling the quotation (CAD). According to Nomura, the CAD will grow from 0.9 percent of GDP in FY 2021 to 1.5 percent of GDP in FY 2022. Barclays is aiming for a 1.1 percent CAD figure, which appears to be a tad bullish on Indian economics.

USD/INR pair has reversed Friday’s decline from late-April highs.

Despite Friday’s mixed US jobs figures, a negative attitude and uncertainty over the Fed’s next moves keep the US dollar bought versus key currencies. However, S&P 500 futures are down 0.15 percent, while markets in Asia-Pacific are down somewhat as of press time.

Moving on, a prolonged holidays in the United States and a light schedule elsewhere may hold the USD/INR near the mid-72.00s. Any unexpected benefits from India, on the other hand, should not be overlooked.

Despite the fact that the mid-April lows test USD/INR bulls near 74.50-55, also short-term sellers are less inclined to take risks entry until the price stays above the 10-DMA level of 74.32. Overall, the USD/INR is forming a bullish rounding bottom chart pattern on the daily chart, implying additional upward towards the yearly top near 75.65.

Source: https://www.fxstreet.com/

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

5 Cryptos Outperformed Bitcoin in FY21, delivering more than 2500%

Euro currency money banknotes background. Payment and cash concept. Announced cancellation of five hundred euro banknotes. Top view.

While Bitcoin returned a remarkable 300 percent to its investors last year, it pales in comparison to the returns from the following cryptocurrencies.

Theta (CRYPTO: THETA)

Theta token is the first cryptocurrency on the list to outperform Bitcoin in terms of returns. This is a ‘governance’ token, which means that its holders have a say in the project’s development. Theta’s creators want to shake up the traditional content delivery techniques.

As advisors, the initiative has Steve Chen, co-founder of Youtube, and Justin Kan, co-founder of Twitch. During the financial year, Theta grew by 2745 percent, confirming its position as the 20th largest cryptocurrency by market capitalization, at $8.17 billion. At the moment, the token is worth $8.16.

Solana (CRYPTO: SOL)

This concept was first envisioned in 2017 and was launched earlier this year by The Solana Foundation, a Geneva-based company. Solana’s proof-of-history consensus is a crucial and appealing feature, as it allows for better protocol scalability.

Solana can process 50,000 transactions per second, according to the project’s website. During FY21, the Solana token soared 3,706 percent to $47.32 per SOL. Over the same time span, this is more than ten times the return on Bitcoin.

Theta Fuel (CRYPTO: TFUEL)

The second native token associated with the Theta video streaming project is Theta Fuel. There are 5.23 million TFUEL tokens in circulation right now. As more TFUEL is generated as ‘staking rewards,’ this amount rises.

During FY21, the value of Theta Fuel increased by 4,510 percent. An tremendous increase that far outweighs Bitcoin’s. This cryptocurrency has a market capitalization of $2.54 billion.

Dogecoin (CRYPTO: DOGE)

During the previous financial year, Dogecoin most certainly exceeded all of its investors’ expectations. Elon Musk, the CEO of Tesla Inc, boosted the dog meme-inspired cryptocurrency with a series of tweets.

The possibility of it being adopted by the electric vehicle industry spread like wildfire. Despite the fact that the frenzy has subsided, dogecoin continues to produce incredible gains. Dogecoin increased by 5,095 percent in the previous fiscal year, nearly 52 times. The cryptocurrency is now the sixth most valuable in the world.

Polygon (CRYPTO: MATIC)

Polygon (formerly known as MATIC) is an Indian blockchain scalability platform called ‘the Ethereum’s Internet of Blockchains’. Polygon states it can offer up to 65,000 transactions per second with confirmation times of less than 2 seconds.

More than 350 decentralised applications have been built on Polygon thanks to a mix of extremely low fees and additional features. In FY21, the Polygon price soared 6,760 percent due to increased use of the network and its token. That result puts Bitcoin’s 300 percent performance to disgrace.

(Source: The Motley Fool)

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Currencies Trading Ideas & Charts

In May, India Inc’s foreign borrowings fell by 51% to USD 738 million.

In May, no borrower used rupee-denominated bonds to raise cash from international markets, as in the previous month.

Among the largest borrowers were BW Global United LPG India Pvt Ltd (USD 198.41 million for capital goods imports), Renew Sun Waves (USD 140 million for new projects), and Indian Oil Corporation NSE 0.32 percent (USD 100 million for working capital requirements). According to the data, Tata SIA Airlines Ltd raised USD 110.40 million for the import of capital goods.

Source:Economic times

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.

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Commodities Trading Ideas & Charts

Downer’s Transformation to Urban Services Business Continues with More Mining Sold Down

In the past, Downer has also underperformed from an operational perspective, but the firm now appears to have learned some hard lessons. The company is pursuing a more capital-light business model for the future, with an emphasis on urban services. In late October 2014, Downer acquired Tenix, a major provider of long-term operations and maintenance services to the power, gas, water, industrial, and resources sectors in Australia and New Zealand. In April 2017, it bought facilities manager Spotless Group.

Key Considerations

  • In late fiscal 2014, Downer completed a high-profile state government rolling stock contract that had weighed on the company’s reputation for the past five years.
  • Based on AUD 36 billion of work-in-hand, Downer has over two and a half years of revenue life, close to the 2.5 year five-year historical average. This is courtesy of Spotless’ additions, many of which are considerably longer dated than mining and EC&M contracts.
  • A key concern in relation to future earnings relates to increased uncertainty surrounding the level and timing of new domestic infrastructure projects by the federal and state governments.

Company Profile

Downer operates engineering, construction, and maintenance; transport; technology and communications; utilities; mining; and rail units. But the future of Downer is focused on urban services, and mining and high-risk construction businesses are being sold down. The engineering, construction, and maintenance business has exposure to mining and energy projects through consulting services. The mining division provides contracted mining services, including mine planning, open-cut mining, underground mining, blasting, drilling, crushing, and haulage. The rail division services and maintains passenger rolling stock, including locomotives and wagons.

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.               

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Commodities Trading Ideas & Charts

Con Ed four natural gas storage facilities with a combined Capacity

The principal asset of the joint venture is three natural gas pipelines with a total capacity of 3 billion cubic feet per day and four natural gas storage facilities with a combined capacity of 41 Bcf. The pipelines and storage facilities are all located in New York and Pennsylvania. The sale of the joint venture for $1.225 billion was in line with our estimate and has no impact on our fair value estimate or EPS estimates. We had already assumed Con Ed would divest its gas transmission investments, following comments in the 2020 10-K that it was considering strategic alternatives for its interest in Stagecoach. Stagecoach is the primary operating asset for the Con Edison Transmission segment, or CET, contributing $0.17 per share in 2020, or about 4% of consolidated EPS.

In March, we reduced our EPS estimates from 2021-2024 by $0.04 to $0.06 per share due in large part to the dilutive impact of our assumption that Con Ed would exit the gas transmission business. At that time, we also established a 2025 EPS estimate of $5.00, resulting in a 4.1% average annual EPS growth rate near the bottom of ConEd’s EPS growth target of 4%-6%. CET also has a projected 8.5% ownership interest in the proposed 300-mile Mountain Valley Pipeline. In 2019, exercised its option under the MVP joint venture agreement to cap its cash contributions at $530 million. In May, MVP announced a six-month delay in the projected startup and an increase in the estimated cost to $6.2 billion from the previous estimate of $5.8 billion to $6.0 billion.

We remain concerned the MVP will never be completed due in large part to the ongoing delays and increasing uncertainty with respect to obtaining necessary permits for waterbody and wetland crossings because of ongoing court challenges. Dominion Energy and Duke Energy elected to abandon The Atlantic Coast Pipeline, a project also moving Appalachian shale gas to Virginia and North Carolina, last year after running into similar challenges.

Company Profile

Con Ed is a holding company for Consolidated Edison Company of New York, or CECONY, and Orange & Rockland, or O&R. These utilities provide steam, natural gas, and electricity to customers in south eastern New York–including New York City–and small parts of New Jersey. The two utilities generate roughly 90% of Con Ed’s earnings. The other 10% of earnings comes from investments in renewable energy projects and gas and electric transmission. These investments have resulted in Con Ed becoming the second-largest owner of utility-scale PV solar capacity in the U.S.       

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Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.               

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Commodities Trading Ideas & Charts

Cabot is the only natural gas producer to earn a narrow moat rating

Meats believes that the firm’s assets are ideally located in the northeast portion of the play fairway, which mainly yields dry gas with very little oil condensate or natural gas liquids content in the production stream. This geographic advantage not only allows the firm to keep costs low but also maintain very high daily production rates. These advantages have enabled the firm to be among the lowest-cost natural gas producers in the Appalachia region, and this competitive advantage enables it to consistently deliver very strong returns on invested capital. Meats do advise caution, however. The company has drilling opportunities in the Lower and Upper Marcellus. The opportunities in the Lower Marcellus are far more lucrative but are expected to last until the late 2020s. This means that the firm will eventually pivot to opportunities in the Upper Marcellus that are typically up to 30% less productive. Meats asserts that when the firm does pivot to the Upper Marcellus, it will be able to reuse existing roads and pad sites, and as there are no well configuration constraints in this undeveloped interval, it could enhance returns by drilling longer laterals. As a result, we expect well costs to decrease enough to offset the dip in flow rates, leaving potential returns unchanged.

Cabot is the only natural gas producer to earn a narrow moat rating. The main reason for this rating is the firm’s low operating and development costs in the Marcellus Shale, which puts Cabot at the lower end of the U.S. natural gas cost curve.

ESG is an important factor to consider when looking at exploration and production companies. This is due to the downside risk ESG factors possess for such companies due to reputational and regulatory risks. Meats does not think that these issues threaten the company’s economic moat due to the 5%-10% spread between projected returns and Cabot’s cost of capital that provides a comfortable margin of safety. The most significant ESG exposure for Cabot is greenhouse gas emissions. While greenhouse gas emissions are unavoidable for oil and natural gas producers, Cabot has taken steps to reduce greenhouse gas emissions intensity in 2020 while also reporting zero flaring in the year. It is also worth noting that while consumers get more skeptical of fossil fuels, much of this aversion is directed toward coal. Natural gas, on the other hand, is less carbon-intense than coal but does not have the intermittency issues that plague wind and solar generators.

General Advice Warning

Any advice/ information provided is general in nature only and does not take into account the personal financial situation, objectives or needs of any particular person.