Hey guys, this is the last full trading week in May, and many forward-looking individuals like myself are already preparing themselves to seize whatever opportunities June may have in store. On this note, I will review a few commodities that have satisfied my quest for swing-trading opportunities in the coming month. Follow me!
Recession: "The Worst is Yet to Come" - IMF Chief Economist
2022-12-29 • Updated
Last week, Pierre-Olivier Gourinchas, the IMF's chief economist, commented on the IMF's global economic outlook, stating clearly that the worst was yet to come. For many people, he opined that the year 2023 would feel like a recession.
The IMF has also warned of an irregular repricing in markets which has led to the conclusive increase in global financial stability risks, which may spread and spill over into other markets due to the combined pressures from food crises, war-driven energy costs (scarcity), inflation, and higher interest rates, thus, driving the world closer to a global recession.
Outlook for Traders
As of 13th October 2022, world stocks dipped nearly below the 2-year low, with the Japanese yen slipping even lower to the 1998 lows. OPEC has decided to cut down on oil production, which could raise oil prices to new highs, hastening a possible global recession.
What to Trade
In times like these, more investors and commercial banks will be leaning towards safe-haven commodities in hopes of capital preservation rather than growth. Thus, there could be more bullish movements on assets like XAUUSD and OIL.
All eyes are on XAUUSD for a possible breakout and retest of the descending channel which should signal the start of a bullish rally.
The Bank of England (BoE) has dramatically shifted its economic forecasts. They no longer expect a recession in the UK and have upgraded their growth projections. This year, the BoE predicts GDP growth of +0.25%, a significant improvement from previous expectations. Next year's forecast is even more optimistic, with a projected growth of 0.75%.
Here's the scoop: The Bank of England (BOE) is set to accelerate the pace at which it shrinks its balance sheet, according to one of its deputy governors. Currently, the BOE is unwinding about £20 billion of quantitative easing every three months. The goal is to reduce the stock by around £80 billion per year through active sales and maturing assets.
Let's dive into the latest developments shaping the global economic landscape. Good news first: the threat of an unprecedented US debt crisis has receded, as US lawmakers passed a bill to raise the debt ceiling and avoid a catastrophic default. Phew! But don't pop the champagne just yet, because storm clouds are still looming. High inflation, rising interest rates, and sluggish growth are challenges that have yet to disappear.
Thanks to the incredible advancements in horizontal drilling and fracking technology, the United States has experienced a mind-blowing shale revolution. They've become the heavyweight champion of crude oil production, leaving Saudi Arabia and Russia in the dust. They even turned the tables and became net exporters of refined petroleum products in 2011.
Let's dive into the world of gold. Currently, the price of gold, represented by XAUUSD, is stuck in indecision, hovering around the $1,975 mark. The market is anxiously awaiting two important factors: the release of the Federal Reserve's meeting minutes and the extension of the US debt ceiling.