It was a bearish month for equities, SPX -93pts (2.8%) to 3269, with the Dow -1280pts (4.6%) to 26501. WTIC settled -$4.33 (11.0%) to $35.79. Copper settled +1cent (0.5%) to $3.05. The USD +11bps to DXY 94.04. The US 10yr yield +19bps to 0.88%.
SPX, monthly
Dow, monthly
WTIC, monthly
Copper, monthly
USD, monthly
US 10yr yield, monthly
Summary
Equities: The SPX and Dow settled net lower, with both not far from their respective monthly 10MAs. Indeed, they could both be breached next Mon/Tuesday, but on balance, November should settle net higher.
WTIC: a second consecutive net monthly decline for oil, settling in the $35s, with next support of 32/30. I would not be surprised to start hearing threats of supply cuts, not least from the house of Saud.
Copper: whilst it was a net monthly gain of just one cent, it was a third consecutive settlement above psy’ $3.00. If gold/silver broadly resume higher into/across 2021, copper should follow to some degree. Implications for FCX, TECK, and SCCO.
USD: The dollar climbed for a second consecutive month, if only fractionally. This was the fifth monthly settlement under the 10MA, currently in the 96s. Indeed, the dollar is still leaning weak since the March 103s. Alarm bells if the 88s are lost, which would offer a test of the historic low in the 71s.
Bond yields: a rather significant gain, although still m/t broken. Things only turn interesting with a break of trend >1.2%. That seems unlikely, as fed bond buying will keep a lid on yields into/across 2021. Further, if yield curve controls are implemented, that should act as a further restraint.
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Dear Subscriber
October sure ended on a rough note, although the m/t bullish trend remains comfortably intact. Whilst early next week should break lower lows, if Trump is victorious, then Mr Market should resume upward.
Meanwhile, over at Print Central…
The latest update saw a net weekly change of -$31.0bn vs +$25.8bn, taking the balance sheet to $7.146trn.
The Fed remain on standby to pick up another trillion or more of T-bonds, once stim’ bill four is passed… some time after the election. For the moment, NIRP is off the menu, although that will be small solace to the US banks, not least Bank of America and Wells Fargo.
Ohh, and there is an FOMC next Wed/Thursday. I would not be surprised to see ‘yield curve controls’ announced. The market would really like that, and such a measure would be especially bullish for gold, silver, and the related miners.
Yours truly wants to pick up something in the gold/mining space, ahead of the election.
As ever, feel free to message me via Disqus or email.
Sincerely, have a restful weekend, and goodnight from London
yours… Philip
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*The weekend post will appear Sat’12pm EDT @ https://tradingsunset.blogspot.com, and will detail ten of the world equity markets.
**I will endeavour to cover some of the end month settlements on Twitter this weekend. Or maybe I’ll just sleep?