Weekly Summary 13-May-2016

Currencies, bonds and most stocks were higher this week, while commodities were mixed. Coffee (up 6.4%) was the strongest asset class, continuing it's climb from last week. Crude oil was the next strongest, rising 5.4%, and more than recovering from the prior week's decline. The biggest losses were in copper, off 1.6%, and platinum, which fell 1.0%.

Currencies were all higher, led by the Canadian Dollar, which rose 2.2%, partially offsetting last week's drop. The USD was in second place, gaining 1.8%. The weakest currencies were the JPY, up 0.1% and the CNY, which gained 0.3%. Bitcoin was in the middle of the pack, up 0.8% for the week.

Among equities, only the HUI gold stocks were lower, falling 0.3%. Japanese stocks showed the biggest gains, rising 2.0%, followed by the S&P 500, which gained 1.3%. Bonds outperformed most stocks, with the short term SHY tracking USD cash and the long term TLT adding 3.3% for the week – the largest gain outside of the volatile commodity sector.

Once again, commodities showed both the biggest gains and the biggest losses for the week. Silver bucked the downward trend in the metals, rising 0.5% to close at 0.42 grams per ounce.

US stocks are hovering on the edge of a long-term sell signal. The last sell signal was in October of 2001 with the DJIA at 946 grams, and lasted until Feb-2013 at 261 grams. Since then, the Dow climbed to a high of 523 grams, and sits today near 430, just 0.7% above its 36 month moving average. Platinum, which is still trading near its all-time lows, but has been in an uptrend since mid January, offers a much better risk/reward ratio with none of the counter-party risk of stocks, bonds, and government-issued currencies.

Priced in Gold Weekly Summary

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