Roy An@HelloitsRoy
Good morning everyone,
I’m mainly looking today at some Oil and AUD bullishness, with some crypto bearishness. Let’s dive into what’s moving markets today :
1) Wheat just hit a 2-years high. Gulf fertilizer production is down 60% since the war begun. This signals that global food inflation is incoming. Higher inflation is historically a signal of lower crypto prices, hence my bearish bias. What’s really important to track today is Kevin Warsh being appointed, and the Fed interest rate decision, both will point towards future monetary policy ; if they point towards possible interest rate cuts, that’s historically bullish for crypto prices, therefore it would encourage me to exit any crypto sells I have.
2) Trump just posted that Iran is failing at signing a “non-nuclear deal” , which signals further escalation between US-Iran and drives oil prices up. The Wall Street Journal reported that the president has instructed aides to prepare for an extended blockade of Iran’s ports. Between 125 and 140 ships usually cross the Strait of Hormuz daily, but yesterday, only seven have done so, according to Kpler. All of the above signals bullish oil prices, de-escalation signals of course invalidate this bias (if they occur).
3) Australia has a budget meeting on Tuesday 12 May. However, some aspects of it have already been leaked yesterday : Australia will most likely raise capital gains tax (by scaling back a discount on Capital gains tax that Australia has previously implemented). While this is bad news for Australian property owners, it’s good news for government income, debt, and more importantly the strength of the AUD. Raising Capital Gains Tax should ideally lower inflation a bit and give the government more income to work with during these economic uncertain times.
4) I would stay away from the stock market today, I previously had a US30 sell ongoing that I just closed at BE. It is true that higher projected inflation usually should lower stock market prices, but today we have really important earnings being announced, which could provide some support to the stock market, hence why I’m staying away.
Good luck !
Roy An.
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