Week of July 30 2016 Weekly Recap & The Week Ahead
..“It cost me millions to learn that another dangerous enemy to a trader is his susceptibility to the urgings of a magnetic personality when plausibly expressed by a brilliant mind.”… Jesse Livermore
1. Oil Makes A Series of Lower Highs & Lower Lows So Far This Summer — the commodity has been under steady pressure, with a series of lower highs and lower lows since making its high in May. Normally, prices tend to rally in the early months of the year, then peak and level off around Memorial Day, before a late-year decline post Labor Day. Chart is courtesy of BIG.
2. Terror Attacks Weigh on Europe’s Travel Companies — a series of terrorist attacks in Europe is driving away tourists at the height of the summer rush, casting a pall over hotel chains, airline companies and luxury retailers that are already grappling with Britain’s vote to leave the EU. Germany was the latest country to get hit by a series of violent incidents over the last weekend, including a suicide bombing and stabbing by two Syrian refugees and a German-Iranian teenager that shot and killed nine people at a mall in Munich.
3. Fed Appears More Willing to Lift Interest Rates In September — the Federal Reserve on last Wed. meeting opened the door a crack to lifting interest rates at its next meeting in September. The statement said “Near-term risks to the economic outlook have diminished,”. The Fed kept its benchmark fed-funds rate unchanged in a range between 0.25 and 0.5%.
4. Crude Nears Fresh Bear Market — since crude prices hit a year-high above $52 a barrel in June they have slipped almost 20%, leaving them on the cusp of a new bear market. The latest EIA data unexpectedly showed a 1.7M barrel rise in U.S. crude inventories vs. what had been steady declines in previous weeks. “The improvement in oil fundamentals remains fragile and continues to feature large offsetting forces,” Goldman Sachs said in a research note overnight, but predicted oil prices to remain in the $45-$50 range until mid-2017.
5. US Q2 Prelim GDP 1.2% vs 2.6% Expected –U.S. economic growth sputtered this spring—growing a meager 1.2% in the second quarter—with cautious business investment largely offsetting more robust consumer spending. Consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased at a 4.2 percent rate. That was the fastest pace since the fourth quarter of 2014. Inventory accumulation by businesses fell $8.1 billion in the second quarter, the first drop since the third quarter of 2011.
The week ahead — Economic data from Econoday.com:
Tags: Oil Bear Market