FREE

COMMODITY OUTLOOK - Base Metals Finishing Counter-Trend Rallies - More Declines To Come - Iron-Ore, XME, COPX Very Bearish - Gold & Silver Limited Upside - Crude Oil Uptrend 80% Done

In This Edition: Commodity markets have attracted a lot of attention this year as inflationary expectations have picked up as the U.S. economy continues strong growth whilst labour shortages forces wage rises across all sectors. Interestingly though, our analysis of key measures of inflation like the trend of the US10yr yield and its spread relationship with the German DE10yr yield indicates a reversal of the widening phase and a transition to contraction over the next several months. This is also reflected in the US10yr breakeven inflation TIPS which has just hit our upside targets of 2.182% ending a five wave impulse uptrend that began from the grand ‘RE-SYNCHRONISATION’ lows of February ’16. Last month’s report forecast another upswing in the benchmark CRB-Cash index towards 443.00+/- but this ending a temporary peak which begins a contraction phase for the remainder of this year. This idea of inflationary pressures taking a pause within the medium-term ‘INFLATION-POP’ uptrend is something we’ve expected as one of the main themes for this year.

We’ve already seen key BASE METALS decline rapidly from interim highs in another signal of waning inflationary pressures. This months’ report updates these key measures in Copper, Aluminium, Lead, Zinc and Nickel together with an update on the US$ dollar cycle, a look at trends in Iron-Ore, the XME Metals & Mining index and COPX. The US$ dollar’s revival following its -15% per cent decline over the last 13-month period is also causing some headwinds for commodity markets.

This month’s report also scrutinises GOLD’s progress within its medium-term uptrend following bullish consensus expectancy at high levels over the last few months. The US$ dollar’s counter-trend upswing is set to continue for several months – so can gold shrug-off the impact of a strengthening dollar or will it succumb to the waning of inflationary pressures and fall back inside its 2-year trading range? Silver and Platinum are also under the same spotlight as are the benchmark gold/silver equity derivatives, with updates for the GDX and XAU contracts.

One of the major inflationary contributors is ENERGY – this month’s report examines the current trends of the XLE Energy SPDR/ETF index with some interesting results – we also update three time intervals of CRUDE OIL because prices are now approaching major upside targets originally forecast back in early-2016.