Market Analysis For The Week Ending June 16th.

Commodities have portrayed a mixed picture over the past week. Gold has remained a stronghold for investors seeking safe-haven assets amid global uncertainties. Spot gold, currently trading around $2,300 per ounce, indicates the enduring rush for Gold, although analysts are skeptical about it reaching the $3,000 mark, suggesting potential resistance ahead. I expect to see Gold over $2,500 within the next six months.

Closely following Gold’s trajectory, Silver has also rallied, hitting near its 11-year peak with prices around $28.76 per ounce, helped by supply deficits and escalating industrial demand. Palladium and platinum prices showed moderate fluctuations but kept their appeal to certain investor segments.

The U.S. 10-year Bond Yield, at 4.243%, dipped slightly in response to mixed inflation data, suggesting investor caution as they weigh the Federal Reserve’s future interest rate decisions.

In cryptocurrency, Bitcoin maintained its rally, with values reaching approximately $66,674, highlighting continued momentum and investor interest in the digital currency market.

Crude oil prices tumbled, sitting at $78.26 per barrel, signaling concerns about global demand amid potential economic slowdowns. Copper and other commodities like Mont Belvieu LDH Propane experienced price shifts, likely reflecting broader market sentiment and economic trend expectations.

Housing Market:

Housing data has been pivotal, with the market witnessing a cooling trend. Prices have seen some correction after extraordinary growth, and while there is some pick-up in activity, challenges like affordability and high mortgage rates linger. Furthermore, housing starts have shown signs of contraction, a point of concern for future supply dynamics.

Automobile Industry:

The automobile industry continues to feel the pinch of elevated prices for key components such as copper. The sector grapples with balancing consumer demand, production costs, and the push toward electric vehicles

Electric vehicles are a solution to a problem that does not exist. EVs powered by Hydrogen with a much smaller reliance on expensive, heavy, and limited batteries could provide a reliable product competitive with gasoline power engines.

Energy Sector:

Energy prices, particularly oil, have seen downward pressure as analysts forecast potential moderation in demand. However, geopolitical risks still threaten the energy market’s outlook.

Credit Markets:

Credit card debt levels and foreclosures remain areas of concern, with implications for financial institutions and consumer spending capacity. A close watch on these indicators will be critical for predicting consumer behavior and economic stability.

Government Spending:

Government spending and fiscal policies are vital in shaping economic growth. With deficits projected to rise, national debt sustainability becomes increasingly a thing of the past.

Shipping Costs:

While directly correlated with commodity prices, shipping costs reflect global trade dynamics and economic activity levels. Any sharp movements could signal changes in trade flows or economic headwinds.

Manufacturing:

Factory closures and manufacturing issues add complexity to the supply chain environment, impacting delivery times, costs, and, ultimately, consumer prices.

3-Month Forecast:

The market suggests cautious optimism, with a stabilization in gold and silver prices at current levels, moderate recovery in oil prices, a potential balance in the automotive industry, some steadying in government bond yields, and a slower yet upbeat manufacturing activity pace. Investors are advised to monitor precious metals closely as a hedge against volatility, stay diversified in commodities, and remain vigilant on market indicators for real estate and the debt market.

Investors are recommended to reallocate from volatile assets to safer investments, including precious metals, high-grade bonds, and potentially cryptocurrency, which some still think is a speculative but increasingly mainstream asset. They should also closely watch the housing market for signs of stabilization or further cooling.

Be not deceived – be prepared ~ Silver Savior

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* Note: We are not giving advice; we only give our opinion; we are not financial advisors. This article only represents our thoughts about the economy.