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Energycrisis

Is the Worst OVER? This is the differential of 10yr vs 1yr US bond which represents long term against short term yield on sovereign debt, and those you don't know, short term bonds are used by central banks to control interest rates(amazing uh? the FED does not actually print money) therefore they do use bonds as a tool to control interest rates which then controls the S&D of capital. As you can see, we are back at a differential which is extremely low, back to energy crisis levels. However, we seem to be already at very low levels, does that mean THE WORST HAS COME? What is going to happen to the stock market? A very quick and personal thought to sum everything up as I do not consider myself an expert macroeconomist: the market is efficient, meaning that the current price on every single security is traded at all the current public information that is available and if something keeps going up, it means that expectation are in favor of it moving higher. Hope that explains what I wanted to say, Feel free to ask question, be safe!
TVC:US10Y
by EWFAlessio
Analyzing Inflation: COVID-19, Energy, Conflict & LaborInflation, a critical financial and economic indicator, has been significantly impacted by various factors in recent years. This article delves into the influence of COVID-19, changes in work patterns, labor market shifts, energy sector decisions, and the Russia-Ukraine war on inflation, presenting a comprehensive analysis of our present financial landscape. COVID-19 and Supply Chains: A Recipe for Inflation The global pandemic, COVID-19, significantly disrupted supply chains worldwide. With a combination of limited supply and robust or surging demand, the result was inevitable - a price increase, a key driver of inflation. Rising costs of materials, labor, energy, and transportation, all amplified by the pandemic, made goods more expensive to manufacture and transport, further contributing to inflation. The aftermath of these disruptions led to a ripple effect: a rise in supply chain costs. Consumers facing higher prices found themselves with reduced disposable income, which could, in theory, lower demand. However, the essential nature of many goods affected by these disruptions likely negated this potential offset, fueling inflation further. In the long run, these disruptions could lead to persistent inflation. The pandemic has exposed the fragility of 'just-in-time' inventories and the impact of underinvestment in global commodity supply chains, adding to inflationary pressures. Consequently, inflation may become a more permanent fixture, disrupting business planning and forecasting and adding another layer of complexity to the economic environment. Labor Market Shifts: From Crisis to Recovery The pandemic has considerably affected the labor market, resulting in significant shifts and shortages across various sectors. The initial outbreak led to severe job losses, with the global unemployment rate peaking at 13%. However, as economies start to reopen, we're seeing an interesting trend: people voluntarily leave their roles, even as worker demand increases. This labor shortage, induced by changing demographics, border controls, immigration limits, and the call for better pay and flexible work arrangements, presents another challenge in our economic landscape. Furthermore, the acceleration of digitalization and the gig economy could have enduring effects on labor supply and productivity. The crisis has potentially long-term implications, like automation's role in slowing the employment recovery in service occupations. Remote Work: A Double-Edged Sword The rise of remote work, while offering significant societal and economic benefits, also carries potential inflationary effects. Increased demand for houses/apartments, home office equipment, utilities, and other home-centric products and services has led to price hikes, accelerating inflation. Moreover, while remote work has the potential to boost productivity and create new job opportunities, it also brings challenges. Difficulties in collaboration, communication hurdles, and blurred work-life boundaries could negatively impact productivity, painting a more complex picture of remote work's overall effect on productivity and inflation. Energy Decisions: A Balancing Act The decision to reduce investments in nuclear energy and fossil fuels can influence inflation and the overall energy market. A decline in energy production can lead to price increases due to supply-demand imbalances, contributing to inflation. Moreover, reduced domestic energy production may increase dependence on imported energy, which, if more expensive or if international energy prices rise, could also lead to inflation. Transitioning to green energy without adequate investment and planning could lead to shortages and disruptions, driving up energy prices and contributing to inflation. While renewable energy technologies are advancing rapidly, they cannot fully replace the capacity provided by nuclear and fossil fuels in many countries. This could lead to energy shortages and price increases, particularly if the transition to green energy outpaces the technology's readiness. The variability of renewable energy sources, such as wind and solar, presents another challenge. Without adequate energy storage and grid infrastructure investment to manage this variability, energy supply disruptions and price spikes could become more common. Moreover, a rapid transition to green energy could displace existing energy jobs before adequate green energy jobs are created. This could lead to economic instability and potentially contribute to inflation. While the long-term costs of renewable energy can be lower than fossil fuels, the initial investment required to build renewable energy infrastructure can be high. Higher energy prices can pass these costs to consumers, contributing to inflation. In conclusion, while the transition to green energy is crucial for addressing climate change, this transition must be well-planned and well-managed. Policymakers must strike a careful balance between the urgency of climate action and the need to maintain energy security and economic stability. The Russia-Ukraine War: Geopolitical Inflation The ongoing conflict between Russia and Ukraine has also played a role in driving inflation. The war has disrupted the supply of essential commodities such as oil, gas, metals, wheat, and corn, pushing their prices upwards. These nations are major suppliers of these commodities, and their reduced supplies have led to sharp price increases worldwide. Furthermore, the conflict has exacerbated global supply chain disruptions, already strained by the COVID-19 pandemic. This has led to heightened inflationary expectations among businesses and consumers. Additionally, the war has significantly increased oil and gas prices, particularly in Europe, directly impacting inflation and household spending. The war has also weakened global economic confidence, further fueling inflationary pressures. Countries already grappling with financial challenges, such as Lebanon and Zimbabwe, have been severely impacted by the inflationary effects of the Russia-Ukraine war. Overall, the conflict is estimated to add about 2% to global inflation in 2022 and 1% in 2023, compared to pre-war forecasts. Conclusion In conclusion, the dynamic interplay of the COVID-19 pandemic, remote work, labor market shifts, energy sector decisions, and the Russia-Ukraine war has significantly influenced inflation. Policymakers, economists, and businesses must navigate this complex landscape to develop effective strategies that mitigate inflationary pressures while promoting sustainable economic growth. As we move forward, we must continue to monitor these factors to understand their ongoing effects on inflation and the broader economy.
TVC:US10Y
by BitcoinMacro
The Bogeyman in Futures TradingNYMEX: Dutch Natural Gas ( NYMEX:TTF1! ), Henry Hub Natural Gas ( NYMEX:NG1! ) and WTI Crude Oil ( NYMEX:CL1! ) Amid a deep energy crisis faced by Europe, Dutch natural gas futures hit a new record of €350 per megawatt hour in August. Governments across the European Union adopted new rules to reduce electricity usage. In just two months, with a dramatic turn of events, natural gas prices in both Europe and the U.S. dipped below zero last week. TTF Next Hour Contract, which reflects real-time European market conditions, fell to -€15.78 on Monday, October 24th. The Waha index — a main indicator of natural gas supplies in the Permian Basin in West Texas, dropped to -54¢/mmBtu on the same day. What has made the highly sought-after energy source worthless? Europe: LNG Overflow and Insufficient Storage TTF contracts are for physical delivery of natural gas through the transfer of rights at the Title Transfer Facility (TTF) Virtual Trading Point, operated by Gasunie Transport Services (GTS), the transmission system operator in the Netherlands. Due to sanctions on Russia, European countries have been buying natural gas globally to prepare for peak winter consumption and asked the public to conserve energy. With increase in gas supply and decrease in gas usage, their efforts paid off. The average gas storage level in the EU has reached 93.4% of capacity, and the storage level in Germany has reached 97.5%. In addition to near-full storage levels, many LNG tankers are heading to Europe. According to Marine Traffic, out of the 641 liquefied natural gas (LNG) carriers in operation worldwide, sixty are already in the north-west Europe, the Mediterranean Sea, and the Iberian Peninsula. Many LNG ships sit idly outside of ports because they cannot be unloaded. Clarksons Securities estimated that the voyage cost of an LNG carrier runs between $276,700 to $313,000 per day. This amounts to $8.3 - $9.4 million a month. In order to stop the bleeding, sellers are so desperate that they would pay someone to take over the shipment. US: Overloaded Pipelines Due to Planned Repairs Waha Index Futures is based upon the mathematical result of subtracting the monthly price published by Inside FERC from the average of the daily prices published by Gas Daily. Permian gas is produced mainly in the form of associated gas, a by-product from crude oil drilling. Crude production from the prolific basin has hit record highs this year, topping 5.4 million barrels per day in October, according to the Energy Information Administration (EIA). Natural gas pipelines in the Permian Basin of West Texas cannot operate normally as they are already fully loaded, and natural gas can only be stockpiled in the Permian Basin. Planned repairs on Kinder Morgan's Gulf Coast Express (GCX) pipeline appear to be the tipping point for the negative prices. Flows on GCX were cut by 38% through October 28th. The constraints forced Permian producers to sell gas at wider discounts to the US benchmark, Henry Hub. Spot prices turned negative on October 24th, meaning sellers have to pay buyers to move the gas. Bogeyman in Physical Delivery Specifications for futures contracts are very specific (hence the name). Exchanges strive to include all possible scenarios in contract design. With respect to the most important features, namely, the grade of the underlying commodity and the methods of trade settlement, no alternations are allowed unless they are specifically spelled out in the Rules Book. Both TTF and Waha reflect spot prices of natural gas physically delivered to the contract-specified locations. These designs worked well at normal times. However, under extreme conditions, sellers could not make delivery due to insufficient storage or overloaded pipelines. Negative pricing is the bogeyman in TTF and Waha. This bizarre phenomenon is a lesser evil for sellers, who have to choose between taking a known loss and potentially bigger exposure with holding unfulfilled financial obligations. How did we get here? In recent years, as developed countries are fully committed to combatting global warming, new investments are flowing into renewable energy, and away from traditional fossil fuel such as oil, gas and coal. As a result, gas pipelines and storage facilities are underfunded and lacking maintenance and upgrades. This year’s geopolitical crisis exposed the risk of getting rid of “dirty energy” too soon before clean energy picks up its pace. TTF Next Hour contract serves as a risk management tool for high-frequency gas traders. The benchmark for European natural gas is actually the TTF Calendar Month Futures. It never turned negative and is quoted at €139 on October 28th. The benchmark for US natural gas is not Waha Index, but NYMEX Henry Hub (NG). It peaked at $9.70/MMBtu in August and is trading at $5.625 on October 30th. Remember the Negative Oil Prices? On April 20, 2020, the front-month May 2020 WTI crude contract ( NYMEX:CL1! ) dropped by 306%, or $55.90, for the session, to settle at negative $37.63 a barrel on the New York Mercantile Exchange. WTI first came to the market in 1983. It was the most successful futures contract in the history of NYMEX. Each contract calls for physical delivery of 1,000 barrels of crude oil at any storage facility in Cushing, Oklahoma. In the next 30+ years, the exponential growth in WTI trading has outgrown the capacity in Cushing. In April 2020, all storage facilities eligible to take delivery were completely full. Sellers had to pay buyers to take the crude oil shipment off their hands. That was the first time a futures contract closed at a negative value. We could see the same bogeyman at play in TTF and Waha. How to Avoid Getting Caught in Negative Prices Unless you are a commercial trader who could make delivery, take delivery, and store shipment, it is highly risky to hold any open positions (long or short) during a contract expiration month. Futures contracts have two methods of final settlement – physical delivery and cash settlement. All financial futures are cash settled. These include equity indexes, interest rates, foreign exchange, and cryptocurrency futures. Commodities futures, including energy, metals, and agricultural commodities, are a mixed bag. They were all deliverable contracts at the beginning. Newer contracts have adopted cash settlement with the help of cash price index, such as CME Lean Hog Futures. Despite the methods of delivery, be it physical delivery or cash settlement, closing out the positions before expiration month is a prudent strategy. Doing so will also avoid getting caught in the depletion of liquidity. Commodity market liquidity is usually rolled over to the next contract month well before expiration date. Happy trick-or-treating ! *Trade ideas cited above are for illustration only, as an integral part of a case study to demonstrate the fundamental concepts in risk management under the market scenarios being discussed. They shall not be construed as investment recommendations or advice. Nor are they used to promote any specific products, or services. CME Real-time Market Data help identify trade set-ups and express my market views. If you have futures in your trading portfolio, check out on CME Group data plans in TradingView that suit your trading needs www.tradingview.com
Editors' picks
NYMEX:NG1!Long
by JimHuangChicago
11
EURUSD: Dollar still strong!EURUSD Intraday - We look to Sell at 0.9810 (stop at 0.9844) Following yesterday's bearish candle, the overall trend lower looks set to continue today. The medium term bias remains bearish. A firmer opening is expected to challenge bearish resolve. Preferred trade is to sell into rallies. Our profit targets will be 0.9736 and 0.9700 Resistance: 0.9810 / 1.0000 / 1.0600 Support: 0.9730 / 0.9550 / Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Short
by VantageMarkets
1
Taf's Gun to the HeadLooking buy Nat Gas on the backdrop of a strong daily support holding.There is also a potential bullish inverse Head and Shoulders forming. Entry:6.729 Target:7.282 SL:6.503 RR:2.45 Disclaimer – Signal Centre. Please be reminded – you alone are responsible for your trading – both gains and losses. There is a very high degree of risk involved in trading. The technical analysis , like all indicators, strategies, columns, articles and other features accessible on/though this site is for informational purposes only and should not be construed as investment advice by you. Your use of the technical analysis , as would also your use of all mentioned indicators, strategies, columns, articles and all other features, is entirely at your own risk and it is your sole responsibility to evaluate the accuracy, completeness and usefulness (including suitability) of the information. You should assess the risk of any trade with your financial adviser and make your own independent decision(s) regarding any tradable products which may be the subject matter of the technical analysis or any of the said indicators, strategies, columns, articles and all other features.
CAPITALCOM:NATURALGASLong
by Signal_Centre1
PCG: Can utilities stand the bears?PG&E Corporatio n Short Term - We look to Buy at 12.25 (stop at 11.57) Price action has formed an expanding wedge formation. This is positive for sentiment and the uptrend has potential to return. Support is located at 12.00 and should stem dips to this area. Preferred trade is to buy on dips. Our profit targets will be 13.79 and 14.50 Resistance: 14.00 / 18.00 / 40.00 Support: 12.00 / 10.00 / 8.50 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’) . Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
NYSE:PCGLong
by VantageMarkets
USDNOK Can Fall Hard If Neckline Is BrokenUSD came down last week as sentiment changed when ECB raised rates by 75bp, so it appears that the USD will now give some moves back as other CB trying to follow the FED. We have also seen some rally on crud, as demand can increase as we approach the winter. Higher crude oil will have a positive impact on some commodity currencies, like NOK, CAD and even MXN, especially during the USD weakness. As such, we have decided to look at the USDNOK today as this one can have the most downside potential. On a daily chart we can see that price came nicely higher last year, but recovery from 2021 low is overlapping which normally means it's a corrective price action. We see this as a higher degree pause in wave B that can be coming to an end after recent turn down from Fibo. cluster resistance area. The divergence line on the RSI also suggests that bulls can be done, especially if we consider the Head & Shoulders top formation. However, a trendline near 9.6 must be broken to confirm lower prices into the third wave of a decline.
by ew-forecast
GBPJPY: Maybe overbought?GBPJPY Intraday - We look to Sell at 167.50 (stop at 168.20) Buying pressure from 164.31 resulted in prices rejecting the dip. Previous resistance level of 166.32 broken. The current move higher is expected to continue. We are trading at overbought extremes. A lower correction is expected. We look to sell rallies. Although the anticipated move lower is corrective, it does offer ample risk/reward today. Our profit targets will be 165.50 and 162.00 Resistance: 168.40 / 171.90 / 176.35 Support: 165.40 / 162.00 / 160.50 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Short
by VantageMarkets
2
EURSEK: Dips worth buyingEURSEK Intraday - We look to Buy at 10.6539 (stop at 10.6164) The medium term bias remains bullish. We look to buy dips. Our short term bias remains positive. Downward pressure has continued and we are assessed as being in the corrective leg lower before the next rally. Previous support located at 10.6500. Our profit targets will be 10.7529 and 10.8182 Resistance: 10.7600 / 10.8000 / 10.9000 Support: 10.6700 / 10.6500 / 10.5859 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Long
by VantageMarkets
EURUSD: Gains should be limited!EURUSD Intraday - We look to Sell at 0.9992 (stop at 1.0042) The medium term bias remains bearish. We are assessed to be in a corrective mode higher. Reverse trend line resistance comes in at 0.9995. We therefore, prefer to fade into the rally with a tight stop in anticipation of a move back lower. Our profit targets will be 0.9881 and 0.9850 Resistance: 1.0000 / 1.0325 / 1.0800 Support: 0.9880 / 0.9800 / 0.9700 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’) . Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Short
by VantageMarkets
1
Natural Gas - A Maniac Market MakerI find the market makers of the Natural Gas Futures market to be particularly wild savages. The recent dump from $9.5~ to $5.3~ is a fine example of how difficult they make getting long. They're like a world class bull at the rodeo. You get a lot of points if you can ride one, but their Buck Off % is like 90%+. Natural Gas is going to $13-$15 and it will very likely do it before 2022 is out The reason is to make it so that North Americans can't afford to heat their homes, especially amid all the other inflation and losing money crushing the middle class. But you should also know that this recent pump to $8.5 was both too direct and too easy. The shake out is coming, and it's not going to be very pleasant. Look for numbers in the low 6s and high 5s and look for these figures to come painfully fast and with little warning. "Fundamentals" don't matter. You keep listening to a propaganda network masquerading as a public intelligence organization that calls itself "the news" and wondering why your compass is broken and you can't figure out what is going to happen. Life is hard and nobody wants you to be rich. Nobody wants you to survive the economic depression that lies ahead. The idea of the establishment is that they will do what they have planned to do, and if you're good enough, you will make it. If you aren't good enough, you will be weeded out. This is fundamentally evil, and while there remains hope and the evil will ultimately fail in its plans, these are nonetheless the scenarios that will unfold, because all of humanity has abetted this for more than two decades. So, you have to do your best and stop going with the flow. Stop adding fuel to the flame. Long NG1 at high 5s and low 6s with a stop under $5.30. The real target is beyond $10, but $10 is coming. Natural Gas is unrealistically cheap in North America compared to Europe and other parts of the world right now. This won't last. But getting there on a long trade will not be so easy.
NYMEX:NG1!Long
by LordWrymouth
12
EURJPY: Battle of the meek!EURJPY Intraday - We look to Buy at 139.00 (stop at 138.40) Buying pressure from 138.92 resulted in prices rejecting the dip. The current move higher is expected to continue. The hourly chart technicals suggests further downside before the uptrend returns. Preferred trade is to buy on dips. Our profit targets will be 140.75 and 141.70 Resistance: 141.70 / 144.30 / 147.20 Support: 138.80 / 137.55 / 135.95 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’ ). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Long
by VantageMarkets
How The European Energy Crisis Is Affecting The Euro‍The euro-dollar exchange rate captures the value of the euro in terms of U.S. dollars. It’s one of the most widely tracked and significant global currency indicators, given that Europe is a major economic region with a strong currency, and many international financial transactions are denominated in euros. Moreover, the euro has been under pressure in recent months because of renewed concerns about European debt and fears that the European Central Bank may curtail its massive stimulus program too early (Injecting Billions of Euros into Eurozone debt - pandemic-era bond-buying program), which would make it harder for countries like Italy to service their debt. With all this in mind, let’s take a look at why the Euro Declined Against the US Dollar and hit a 20 Year Low recently. The European Energy Crisis Energy is a critical aspect of any economic outlook. As such, it is no surprise that Europe’s energy crisis has exacerbated its economic problems. Europe currently relies on Russia for approximately 50% of its natural gas. Europe’s heavy reliance on Russian gas is a major source of tension between the EU and Russia. The EU has placed sanctions on Russian energy firms, making it difficult for them to acquire equipment and technology they need to develop their energy infrastructure. That has left Europe with few viable options for alternative suppliers. Effects of EU Sanctions against Russian The EU’s Largest Member States Are Suffering The most significant economic problems can be found in Europe’s largest economies: Italy, France, Germany, and Spain. And those four economies are suffering because of the energy crisis, a weak euro, Brexit, and rising interest rates. The euro has been trading at a relatively low level against the U.S. dollar for years. However, the euro’s weakness has recently accelerated, as the European Central Bank adopted a more hawkish tone. That has made it more expensive for other countries to buy euros. Ergo, pushing up borrowing costs for euro-zone countries that are heavily indebted like Italy, France, and Spain. It has also made it more expensive for the European Union’s most powerful economies to service their debt. Political Instability It’s important to mention political instability because it has been an ongoing issue in Europe for years, particularly in countries like Italy, France, and Germany. That’s led to significant political uncertainty that has kept investors away and made it more difficult for these countries to get the strong economic growth they need to deal with their debt problems. The United Kingdom has been a major trading partner with the EU, The political environment surrounding the Brexit has led to significant economic uncertainty. Eurozone Growth Is Stagnant One of the most important economic metrics is GDP growth, which is the rate at which an economy is producing goods and services. Eurozone GDP growth has been relatively low for years, and it recently fell to a 17-year low. That’s largely due to lack of investment in major economies like France, Germany, and Italy, which are the most significant contributors to the eurozone’s GDP. When the energy crisis hit the EU, businesses stopped investing in plant and equipment necessary for growth. As a result, GDP shrank throughout the region. That’s forced the European Central Bank to take strong action, including negative interest rates and quantitative easing. However, those policies have had only limited success, as Europe is still facing an investment drought. European Union Debt Crisis The EU debt crisis emerged in 2010 when major economies like Italy, Spain, and Greece racked up unsustainable debt loads. Although it has faded in recent years, it remains a major issue, particularly for Italy and Spain. That’s because the two countries have large debt loads, and they are suffering from slower growth, making it harder to service that debt. That’s created significant economic uncertainty, as investors have been reluctant to lend to these countries. The European Central Bank has stepped in, making it easier for these countries to borrow, including buying their debt. However, the ECB’s actions have also made it easier for other EU countries to borrow, which has contributed to the rise in interest rates that are hurting France and Germany. ECB Tapering As the energy crisis worsened and economic growth was weak throughout the European Union, the European Central Bank boosted its monetary stimulus to stave off a deeper downturn. That included purchases of billions of euros of assets, including government bonds, per month. That quantitative easing program has been credited with helping Europe’s major economies, particularly Germany, avoid a full-blown economic crisis, as well as keeping the value of the euro low. That has also bolstered economic growth in other EU countries, like France and Italy, that rely on exports to Germany. However, with the energy crisis easing and economic growth gaining momentum, the ECB began to taper its QE program, reducing monthly purchases to just €30 billion. boosting the borrowing costs of the European Union’s larger economies. Oil Price Impact The energy crisis has also driven up the price of oil and other commodities. That has put additional pressure on the EU’s most significant economies, as their industries have been affected by higher prices. That’s particularly true for France and Italy, which have been among the hardest hit by the energy crisis and oil price surge. That’s made it more difficult for those economies to export goods and services, which has contributed to the stagnation of their GDP. Conclusion The European energy crisis has been a major problem for the EU. It has driven up the price of oil and gas, while making it more difficult for countries to import those resources. That has put the EU at an economic disadvantage when compared to other major regions, like the United States. That’s made it harder for the EU to recover from a variety of economic issues, including a low growth rate, high debt levels, and political instability. It remains to be seen if the EU can overcome its energy crisis and get back on track to economic prosperity. EUROZONE INFLATION RATE Important Upcoming Events that will cause volatility in the market
Editors' picks
by EQTSHARES
30
EURSEK: Relief for Euro?EURSEK Intraday - We look to Buy at 10.5061 (stop at 10.4602) Preferred trade is to buy on dips. Downward pressure has continued and we are assessed as being in the corrective leg lower before the next rally. There is scope for mild selling at the open but losses should be limited. We therefore, prefer to fade into the dip with a tight stop in anticipation of a move back higher. Our profit targets will be 10.6593 and 10.6918 Resistance: 10.6600 / 10.7000 / 10.7500 Support: 10.5000 / 10.4500 / 10.4000 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Long
by VantageMarkets
Could a short or long term bottom be in for EURUSD?The situation is very tricky as Europe's condition worsens. As the global economy is in a depression, the USD could keep going higher and higher, especially as the world faces more problems than the US. In his tread, Marko Papic outlines very eloquently why he thinks the European situation isn't as bad as many think, and he could be right. I am not as optimistic as he is, but there is a chance that the market has bottomed with the sweep of the previous low and the close above it. Even if it hasn't, it provides a nice setup for the short term long. The EURUSD parity is a fundamental psychological level where we could see a lot of chops before it goes either direction. twitter.com
Long
by BitcoinMacro
EURUSD: How low can you go?!EURUSD Intraday - We look to Sell at 0.9997 (stop at 1.0060) We are trading at oversold extremes. There is scope for mild buying at the open but gains should be limited. Resistance is located at 1.0000 and should cap gains to this area. Preferred trade is to sell into rallies. Our profit targets will be 0.9853 and 0.9825 Resistance: 1.0000 / 1.0360 / 1.0800 Support: 0.9850 / 0.9700 / 0.9600 Please be advised that the information presented on TradingView is provided to Vantage (‘Vantage Global Limited’, ‘we’) by a third-party provider (‘Signal Centre’ ). Please be reminded that you are solely responsible for the trading decisions on your account. There is a very high degree of risk involved in trading. Any information and/or content is intended entirely for research, educational and informational purposes only and does not constitute investment or consultation advice or investment strategy. The information is not tailored to the investment needs of any specific person and therefore does not involve a consideration of any of the investment objectives, financial situation or needs of any viewer that may receive it. Kindly also note that past performance is not a reliable indicator of future results. Actual results may differ materially from those anticipated in forward-looking or past performance statements. We assume no liability as to the accuracy or completeness of any of the information and/or content provided herein and the Company cannot be held responsible for any omission, mistake nor for any loss or damage including without limitation to any loss of profit which may arise from reliance on any information supplied by Signal Centre.
Short
by VantageMarkets
1
Uranium Preparing for an 80% Move UpwardsThe SPROTT Physical Uranium Trust TSX:U.U is showing a triangle formation on the daily chart. There is a number of reasons why I am inclined towards higher Uranium prices: 1. Rising inflation. 2. Rising commodity prices. 3. Supply chain problems (although doesn't apply to Uranium that much). 4. Energy Crisis! 5. The world starting to see that Nuclear energy is the proper choice forward until we can transition to fully renewable energy infrastructure in 50 years or more. (this one will not affect price soon of course). 6. Uranium is not expensive as fuel at all. It costs only 5% of the annual expenditure of a nuclear plant. So price has a lot of room to go up before it's considered too expensive. 7. We have a Physical Uranium Trust now. So the market has direct exposure to physical uranium that was never there before. With all that, the move hasn't yet been confirmed because we haven't broken the top of the triangle yet. Keep watching this post as I update it. If you are interested in this trade, set up an alert on TradingView and follow me for an update for my trade setup.
TSX:U.ULong
by TechNerdOmar