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A muted bank holiday session

It’s been an unsurprisingly muted day in the markets as the US celebrates Thanksgiving and the rest of us are left to watch most asset classes tread…

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This article was originally published by Market Pulse

It’s been an unsurprisingly muted day in the markets as the US celebrates Thanksgiving and the rest of us are left to watch most asset classes tread water for most of the session.

European stocks are on course to close marginally higher which is encouraging in itself given the fear around inflation, interest rates and Covid at the moment. The latter caused a jolt in the markets last Friday but investors have gathered their composure once more. The risk of lockdowns and restrictions hasn’t passed so continues to weigh.

The US posted some more strong economic data on Wednesday as it dumped a few days’ worth of releases on us in the space of an hour and a half which was nice and easy to digest. Ultimately, the takeaway from the data was that the economy is looking strong, the labour market is in great shape and the consumer is ready to spend going into the important holiday season.

A number of Fed policymakers will be comforted by the numbers we’ve seen recently on the back of a really strong third-quarter earnings season. At times over the last few months, it must have felt like the walls were closing in. Inflation was running hotter, lasting longer and yet the economy wasn’t necessarily ready for rate hikes. They may now feel much more relaxed and we could now see the consensus grow for faster tapering and earlier tightening than the bulk have allowed themselves to consider previously.

Even the lira has been relatively muted by recent standards. That may be something to do with the US bank holiday, although it’s probably just finding its feet now that the dust has settled following Erdogan’s defiant speech that pulled the rug from under the remaining lira bulls. I’m sure there’s plenty of lira volatility to come in the days and weeks ahead but for now, it appears to be enjoying some reprieve.

A bitcoin Santa rally?

Bitcoin is enjoying some reprieve during the US bank holiday. Of course, the tale we hear every year is that of families sitting around the table and buying bitcoin on their phones following the thrilling annual crypto chat over Turkey. It certainly makes for a nice story but I’m sure it probably has more to do with the 20% decline we saw after hitting record highs a couple of weeks ago and consolidation we’ve seen the last couple of days. If the price breaks USD 60,000 again, perhaps this year’s Santa rally will be led by bitcoin.

For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/




Author: Craig Erlam

Precious Metals

Oil steady ahead of OPEC+, gold fragile

Oil steady as traders eye OPEC+ meeting Oil prices are also steady today, a common theme as we make our way through the various asset classes. Brent and…

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Oil steady as traders eye OPEC+ meeting

Oil prices are also steady today, a common theme as we make our way through the various asset classes. Brent and WTI bounced back strongly following the US-led SPR release this week, a move that was heavily priced in and failed to get pulses racing.

Some are speculating about a possible retaliatory move from OPEC+ when it meets next week but such a move would seem rather unnecessary when prices remain very high. The group doesn’t want to align itself with the greedy manipulator tag some have tried to apply to them. They don’t need to involve themselves in the politics of it all and I’m sure consuming countries will be hoping they opt not to. If this does turn into a price war, there will only be losers, albeit to a lesser extent on the producer side.

Gold fragile after consolidating below USD 1,800

Gold has settled below USD 1,800 in recent days, after being pummelled by more hawkish interest rate expectations ahead of the December meeting. Faster tapering and multiple rate hikes next year have ruined gold’s appeal. Yes, we still have high inflation but now it seems the central bank intends to do something about it. It was good while it lasted for the yellow metal.

Gold has found some support around USD 1,780 but it’s looking fragile and the pressure could mount once more when the US returns next week, if not sooner. This is around the 50% retracement level of the August lows to the November highs which may be why we’re seeing some support at the moment. But I don’t think this is a retracement which is why it will eventually break, and the 61.8 fib below around USD 1,750 may be a more fitting temporary bottom if it does consolidate ahead of the December FOMC meeting.



Author: Craig Erlam

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Economics

Crypto roundup: Bitcoin and altcoins back in the gravy on Thanksgiving Thursday

As the world’s biggest economy celebrates its Thanksgiving, the US dollar Index (DXY) is still riding pretty high… and the … Read More
The post Crypto…

As the world’s biggest economy celebrates its Thanksgiving, the US dollar Index (DXY) is still riding pretty high… and the crypto market’s not exactly a turkey, either.

At the time of writing, the entire cryptocurrency market cap is looking about 5.3% more positive than this time yesterday, and is back up around US$2.81 trillion – according to CoinGecko data.

There’s a lot more green on the crypto charts today, with some pretty tasty offerings well placed on the table.

Coin360.com

OG market-moving favourites Bitcoin (BTC) +4.6%, and Ethereum (ETH) +7.1%, are both showing some good form. And even the former no. 3, Cardano (ADA) + 6.5%, looks like it might be back in some sort of business after a reasonably torrid, big-dipping week for the asset.

Bitcoin, seen as an inflation hedge by many, usually correlates negatively against a strong-performing DXY. The latter is still in a lofty position compared with where it’s been for much of the past 16 months, however, could it be hitting a little bit of resistance? Possibly. It’s down a fraction – negative 0.12% since its last daily close.

Bitcoin dominance, meanwhile, has dropped a little bit. According to CoinGecko, which accounts for 11,124 cryptos at the time of writing, Bitcoin dominance over the market has dipped to 39.63%.

CoinMarketCap, however, takes in data from more coins – 14,812 – and is showing a BTC dominance figure of 41.8%. It’s still lower than it has been recently, though.

Is a lower Bitcoin dominance good? It potentially is for altcoins. The lower that level comes down, the higher chance it is that we could be moving into a possible “altcoin season”. A traditionally festive period of frothy FOMO, “moon Lambo” chatter and general price pumpage.

No guarantee, of course, but a quick look around Crypto Twitter, and it’s not hard to find some excitable chit-chat and positive chart-gazing analysis for the altcoins…

… but also for Bitcoin, too…

Meanwhile, the US Democratic senator Elizabeth Warren has a Thanksgiving message for Americans…

… and the billionaire Gemini crypto exchange and custodian co-founder Cameron Winklevoss has one for her… #inflationnation…

And, lingering on the Thanksgiving theme for a moment longer, Macy’s – one of America’s biggest department stores – launched its “Macy’s Parade NFT” series today, built on the Polygon network, with all proceeds going to charity.

 

Mooners and shakers: Gala Games hits boss level

While trying to keep FOMO in check, let’s have a look at what’s really moving in the cryptoverse today…

Some notable double-digit gainers in the top 100 by market cap include: dog-meme coin Shiba Inu (SHIB) +20%; Polygon (MATIC) +11%; Theta Network (THETA) +12%; Filecoin (FIL) +11%; Gala Games (GALA), relentlessly continuing to level up, +47%; Curve (CRV) +18%; Basic Attention Token (BAT) +29%; and Immutable X (IMX) +11%.

A scene from Gala Games’ Spider Tanks NFT battler

Projects in the GameFi space are on a roll right now, and Gala Games, with its suite of fun-looking time wasters, including Spider Tanks and Townstar, is clearly crushing it right now…

While investing at all-time-high levels isn’t really advisable (er, not financial advice), GALA is clearly one to keep watching. Perhaps a decent entry point will come on the back of some market profit taking.

A brief look outside the top 100, and we’ve got more daily winners, including RPG NFT battler Illuvium (ILV) +14%, hitting a new all-time high an hour ago of US$1,800; Request Network (REQ) +170%; Chain Games (+58%); and Ethereum Name Service (ENS) +48%… just to name a few.

On the flip side, some notable 24-hour dippers today include cutesy metaverse game My Neighbour Alice (ALICE) -13%; The Sandbox (SAND) -12%; Wax (WAXP) -12%; and Decentraland (MANA) -10%.

Some potentially tasty Thanksgiving pullbacks within the buzzy metaversal narrative, right there.

 

Moonbeam grabs second Polkadot parachain slot

Oh… and a final news bite to finish up. As widely expected, Moonbeam – a Polkadot-based smart-contract platform – has won the second, highly coveted parachain slot, with over 35 million DOT contributed from more than 200,000 contributers worldwide.

The project joins Acala, a Polkadot ecosystem DeFi hub, on the exclusive Relay Chain-plugging list. You can read all about what that means, and how it all works, here. It’s, you know, kind of a big deal.

 

The post Crypto roundup: Bitcoin and altcoins back in the gravy on Thanksgiving Thursday appeared first on Stockhead.



Author: Rob Badman

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Economics

Higher And Higher: Used Truck Price Inflation Shows No Signs Of Abating

Higher And Higher: Used Truck Price Inflation Shows No Signs Of Abating

By Alan Adler of FreightWaves,

The sky’s the limit. Now find the…

Higher And Higher: Used Truck Price Inflation Shows No Signs Of Abating

By Alan Adler of FreightWaves,

The sky’s the limit. Now find the sky.

That is the ongoing story of used truck prices at both auction and retail for the first 10 months of the year. J.D. Power Valuation Services pegs the year-over-year increase in auction prices at 89.9% — with the gavel dropping on month-over-month increases of 7%.

“The sense of urgency is as strong as ever in the auction lanes, with buyers continuing to pay record pricing for desirable trucks,” Power said in its monthly Guidelines newsletter covering October.

Price inflation in used trucks shows no sign of abating as year-over-year increases are pushing 90% and month-over-month jumps are around 7%.

Power tracks a group of 4- to 6-year-old trucks. Not only are year-over-year prices stratospheric, but they are running 71.2% ahead of the same period in 2019.

Two examples from the recent Ritchie Brothers auction in Orlando, Florida, point to the inflation caused by a practically nonexistent supply of quality used trucks assigned for auction. A 2017 Freightliner CA125SLP Cascadia sleeper truck tractor sold for $112,000. And a 2019 Volvo VNL760 sleeper truck tractor brought $105,000.

Huge backlogs and long lead times

Huge backlogs and long lead times to get new trucks because of a shortage of semiconductors and a host of other parts have stretched delivery times to a year from the date an order is placed.

“Many of the fleets we have spoken to are in an excess-capacity situation” with no one to drive trucks they do have, Steve Tam, vice president of ACT Research, told FreightWaves. “That said, they have equipment on order and are frustrated with the delivery delays. Some fleets who are not traditionally used truck buyers are turning to the secondary market to find equipment.”

Combining a surge in former company drivers getting their own trucking authority through the Federal Motor Carrier Safety Administration and the scarcity of low-mileage used trucks, prices have nowhere to go but up.

“There is no question that a significant portion of the incremental demand for used trucks has come from new entrants, many of whom are either single truck operators or small fleets,” Tam said.

The average sleeper tractor sold at retail in October was 73 months old, had 450,478 miles and brought $82,588 — 88.3% more than than a year ago. The age is well off the record of 96 months that the average used truck hit in 2015.

The age of used trucks is on the rise in the last year — not close to the record of 2105 — but a trend likely to continue amid the supply chain crisis crimping new truck production. (Source: ACT Research)

Is a permanent change ahead?

“Since those trucks are being kept in service and not resold, our used truck sales data does not yet show a notable change in average age,” Chris Visser, J.D. Power senior analyst and commercial vehicles product manager, told FreightWaves. 

“In the first 10 months of this year, sleeper tractors sold [at] retail averaged 71 months old, compared to 68 months in the same period of last year and 70 months in 2019.”

Could the current shortage caused by a lack of trade-ins lead to permanent change in the definition of a quality used truck, typically 4 years old and 400,000 to 450,000 miles?

“In the used truck data we collect, we have seen the average age of Class 8 trucks sold go from a cyclical low of 74 months in October 2020 to 83 months in August 2021. It ticked down in September to 80 months,” Tam said. “We believe that it is a temporary situation that will begin to reverse itself as more new trucks become available.”

Watching the ’19s

Power is watching to see what will happen when 2019 models begin to show up in auctions in greater numbers.

“Model-year 2019 deliveries were about 30% higher than model-year 2018 deliveries,” Power said in Guidelines. “We’ve seen an incremental increase in the number of 2019s sold in recent months, but demand for these trucks is still outstripping supply.”

Lower auction volumes in October showed higher prices across the board with the newest trucks, 2018 models, commanding 1.5% more. By contrast, 2014 models brought 11.5% higher prices. The three years between averaged 8.9% to 11.1% higher prices.

On a retail basis compared to September, October’s average pricing was: 

  • Model year 2020: $134,178; up 2.6%.

  • Model year 2019: $107,725; up 3.3%. 

  • Model year 2018: $86,401; up 1.3%. 

  • Model year 2017: $72,682; up 3.8%.

  • Model year 2016: $55,904; up 0.3%. 

How much risk is there in overpaying for a used truck at today’s prices? It is a hot topic of conversation, Tam said. Finance companies are requiring bigger down payments to protect themselves.

“Regardless, when freight growth stalls, there will be an increase in repossessions,” Tam said. “The silver lining is that there will be fewer than there would have been without the proactive efforts.”

Added Visser: “Trade-ins are also worth more than they had been, so this factor combined with substantial down-payment requirements means the number of truck owners underwater on their rigs might not be critical when the correction happens.”

Tyler Durden
Thu, 11/25/2021 – 10:35

Author: Tyler Durden

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