Gold Soars To All-Time Highs

About a week after the chatter around gold began to pick up on Stocktwits, the shiny metal is hitting new all-time highs. But still, some are perplexed as to why it’s rallying. 🤔

Bears argue that gold should not be rallying in the current environment. After all, inflation continues to trend back toward the Fed’s 2% target, and the economy is holding up well thanks to a strong labor market and consumer spending. And with the risk-free rate still above 5%, some investors and traders argue there are better alternatives to gold and precious metals as a group.

Despite that pushback, prices continue to trend upward, with some analysts forecasting a rise to $2,500 and $3,000 in 2024. We’ll have to wait and see who is correct, but for now, bulls have the clear edge as prices close at their highest level ever. 🤩

Oil & Gas Sector Loses Its Energy

After a strong run throughout the summer, it’s been a rough two weeks for energy-related commodities and stocks. Today, an accelerating decline helped bring the sector back to the forefront of investors’ conversation. Let’s take a look at why. 👇

In very short-term fundamental news, gasoline inventories surprised to the upside today on weak demand. That caused the commodity to extend its recent selloff. But more importantly, we also saw heating oil and crude oil selloff in tandem after holding relatively strong during gasoline’s pullback.

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Gold Shimmers Around $2,000/Oz

Precious metals have not gotten much fanfare lately, especially with palladium in a downtrend and platinum and silver stuck in messy ranges. 💤

However, one that continues to pop up on investor and trader radars is gold, which is once again trying to break above $2,000/oz. Below is a chart showing prices stuck in a range for the last 2.5 years, each time failing to sustain a break above resistance. 🔐

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Palladium Pops In “Dash For Trash”

One of the key themes we’ve discussed since early November is money looking for a new home in beaten-down areas of the market. That theme continued today with the Federal Reserve confirming the market’s rate cut bets with a dovish statement and projections. 💸

We saw significant rallies in stocks like Carvana, Upstart, SoFi Technologies, Lucid Group, Rocket Companies, and many more highly-shorted names. But it’s not just happening in the stock market. Assets across the board rallied, including one of this year’s worst performers, palladium.

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Crude Tops 90 As Inflation Ticks Up

Before we get into U.S. data, we need to discuss the European Central Bank’s (ECB) rate decision. The central bank surprised markets by raising rates another 25 bps to 4.00%, marking its tenth consecutive hike. 🔺

Unlike the U.S., Europe has not made as much progress in bringing down inflation, and its economy has not been as resilient. The region started raising rates later than the U.S. and experienced more direct impacts of the war in Ukraine, so it’s understandable that they’d be a bit behind the curve in making progress.

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