Other markets on May 10, 2018: outlook


Here are my discretionary thoughts on forex, commodities, bonds, and cryptocurrencies. I only trade the stock market.
Go to the homepage for my latest thoughts on the markets.

Thoughts

  1. The Petrodollar is being slowly eroded. A long term bearish factor for the U.S. dollar.
  2. Buying silver is better than buying gold right now.

7 am: The Petrodollar is being slowly eroded. A long term bearish factor for the U.S. dollar.
China has launched the Petroyuan for a month, and more and more countries are abandoning the Petrodollar for the Petroyuan (oil futures contracts denominated in the Chinese Yuan). Iran, Qater, Venezuela, and Russia have already agreed to trade oil in Yuan. Now Nigeria is on the verge of accepting the Yuan as well.
This is a long term bearish factor for the U.S. dollar. The Petrodollar (trade in global oil via U.S. dollars) creates an artificial demand for the USD, which keeps the value of the USD artificially higher. With China slowly chipping away at the Petrodollar’s place in the global financial system, this artificial long term demand/support for the USD is being slowly chipped away.
7 am: Buying silver is better than buying gold right now.
The USD Index is still trending higher, which puts downwards pressure on gold and silver. With that being said: it’s better to buy silver than gold when the USD’s rally is over.
For starters, silver’s price action is much more bullish than that of gold. Silver is trying to bounce off of its support level, while gold is merely swinging sideways at its support level.


As you can see from the charts above, gold has more downside risk than silver does.
In addition, the smart money is much more bullish on silver than they are on gold. Here are commercial hedgers from the COT report.


Read Other markets on May 8, 2018: outlook

Bottom line

I only trade stocks. These are just my thoughts and outlook on other markets.

  1. Gold and silver are in bull markets.
  2. I’ve decided to buy some gold and silver as long term investments.
  3. The U.S. Dollar is in a bear market.
  4. Cryptocurrencies might be starting a new bull market (I’m not so sure about this one).

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