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US Dollar Ends Winning Streak As Jobless Claims Fall to Three-Week Low

The US dollar is ending its winning streak midweek amid renewed optimism in the broader financial markets. Despite concerns over a new strain of the coronavirus that appears to be more infectious, the investors were optimistic over initial jobless…

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This article was originally published by Forex News

The US dollar is ending its winning streak midweek amid renewed optimism in the broader financial markets. Despite concerns over a new strain of the coronavirus that appears to be more infectious, the investors were optimistic over initial jobless claims declining to their lowest levels in three weeks. But as long as the COVID-19 vaccines prove effective, traders will remain bullish on stocks, which is bad news for the dollar.

According to the Bureau of Labor Statistics (BLS), the number of Americans applying for unemployment benefits came in at 803,000 in the week ending December 19. This is lower than the median estimate of 885,000, and the reading is a drop from last week’s 892,000 applications.

Continuing jobless claims declined to 5.337 million, while the four-week average, which removes week-to-week volatility, topped 818,000.

In the same week, 397,511 applications for benefits from a federal-relief program were submitted. This brought the total number of new claims to 1.27 million. Since the COVID-19 public health crisis began, initial jobless claims have yet to slide below one million.

Meanwhile, the BLS stated in a separate announcement that it plans to introduce new measures to enhance the data’s reliability. Although the overall report is believed not to be perfectly accurate, market analysts say it is best to concentrate on the weekly report’s specifics rather than the totals.

Last month, the Government Accountability Office (GAO) published a report that found the numbers were inflated due to double counting, fraud, and other issues.

In other economic data, the Bureau of Economic Analysis (BEA) reported that personal income tumbled 1.1% in November, while personal spending slid 0.4%.

Durable goods orders advanced 0.9% last month, beating the market forecast of 0.6%. This represented the seventh consecutive months of new orders for US manufactured durable goods.

On the housing front, mortgage applications edged up 0.8% in the week ending December 18. The 30-year mortgage rate edged up one basis point to 2.86%. Also, housing prices increased by 1.5% in October, and new home sales plunged 11% in November to 841,000.

The US bond market was green across the board. The benchmark 10-year Treasury jumped 0.038% to 0.956%. The one-year note dipped 0.002% to 0.091%, while the 30-year bond surged 0.052% to 1.706%.

The US Dollar Index, which gauges the greenback against a basket of currencies, slumped 0.38% to 90.31, from an opening of 90.52. The index enjoyed a two-day rally of 0.3% before paring its gains. The DXY is poised to finish the year down around 6%, but it has cratered roughly 15% since hitting a peak of 103.00 at the height of the coronavirus-induced financial crisis.

Investors had been pouring into the greenback during the holiday-shortened trading week over the mutation of the coronavirus in the UK. The British government also discovered a second variant of the coronavirus from South Africa. So far, medical experts say that the three vaccines on the market should be efficacious against this new strain, but it might also be too early to tell.

The USD/CAD currency pair tumbled 0.51% to 1.2842, from an opening of 1.2909, at 16:30 GMT on Wednesday. The EUR/USD rose 0.27% to 1.2195, from an opening of 1.2163.


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Economics

WTI Extends Losses After Smaller Than Expected Crude Draw

WTI Extends Losses After Smaller Than Expected Crude Draw

Crude prices puked over 5% today as demand fears over Omicron (jet fuel demand)…

WTI Extends Losses After Smaller Than Expected Crude Draw

Crude prices puked over 5% today as demand fears over Omicron (jet fuel demand) and European case count continued acceleration combined with Fed Chair Powell’s taper tantrum. While tighter monetary policy can be a sign of economic strength, it’s typically bearish for commodities. WTI briefly dropped below $65 a barrel for the first time since August during the session, while the global benchmark Brent also tumbled.

“That ties back to crude oil because if you start to pump the brakes on economic growth, you start to see impact on demand,” said Rebecca Babin, senior energy trader at CIBC Private Wealth Management.

Oil traders are also tracking talks this week aimed at reviving Iran’s 2015 nuclear deal with world powers. Success at the negotiations in Vienna could lift sanctions on Iran’s economy, leading to a resumption in official oil flows. The exchanges began positively on Monday, according to a top European diplomat.

However, the next leg one way or the other will likely be decided by this week’s inventory data…

API

  • Crude -747k (-1.66mm exp)

  • Cushing (+1.00mm exp)

  • Gasoline

  • Distillates

Crude stocks fell 747k barrels last week, less than expected…

Source: Bloomberg

After the biggest monthly drop since March 2020, WTI was hovering around $66.75 ahead of the API print and dipped after despite the small crude draw…

Are we about to see gas prices at the pump plunge?

As Bloomberg notes, the oil market is also continuing to weigh the impact of the omicron variant of the Covid-19 virus on demand and what OPEC+ may decide to do in response when the producer group meets later this week. New travel restrictions threaten the rebound in global crude consumption that has underpinned this year’s price rally.

Tyler Durden
Tue, 11/30/2021 – 16:37




Author: Tyler Durden

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Economics

4 Top Stock Trades for Wednesday: Ethereum, XPEV, DLTR, BABA

Stocks were creamed on Friday due to worries over the new Covid variant Omicron. We bounced nicely on Monday, but stocks are back under pressure on Tuesday….

Stocks were creamed on Friday due to worries over the new Covid variant Omicron. We bounced nicely on Monday, but stocks are back under pressure on Tuesday. With that in mind, let’s look at a few top stock trades.

Top Stock Trades for Tomorrow No. 1: Ethereum (ETH-USD)


Click to Enlarge
Source: Chart courtesy of TrendSpider

While Bitcoin (CCC:BTC-USD) isn’t seeing the same kind of rotation today, Ethereum (CCC:ETH-USD) sure is.

In fact, Ethereum is going weekly-up over $4,555. From here, that puts the 161.8% extension and the all-time high in play up near $4,875 to $4,900.

If that does indeed come to fruition, bulls will inevitably turn their attention to the $5,000 level. A breakout over $5,000 puts the $5,500 area in play next, followed by $6,000 to $6,250 zone — where another set of upside extensions sit.

Back below $4,555, and investors will be watching the 10-day and 21-day moving averages.

Below $4,380 has the 50-day and 10-week moving averages on deck, followed by around $4,000.

Top Stock Trades for Tomorrow No. 2: Xpeng (XPEV)

Daily chart of XPEV
Click to Enlarge
Source: Chart courtesy of TrendSpider

Xpeng (NYSE:XPEV) continues to trade incredibly well. And if we look at just this chart, there’s no indication that the market is experiencing any volatility.

The stock is doing a terrific job holding up over the breakout level (blue line) and the 10-day moving average. Now trying for a weekly-up rotation and a move over the 61.8% retracement, bulls are hoping to see Xpeng gain steam over $55.

If it does, that could open the door to the current 2021 high up near $60, then the 78.6% retracement at $63.41.

However, a move below the breakout level and the 10-day moving average could force XPEV stock to rest a bit.

Top Stock Trades for Tomorrow No. 3: Dollar Tree (DLTR)

Top stock trades for DLTRf
Click to Enlarge
Source: Chart courtesy of TrendSpider

Dollar Tree (NASDAQ:DLTR) was a stock I had on my radar early this morning, as the stock was under pressure from a downgrade following a fantastic earnings reaction.

Shares are checking back to the 10-day moving average after its massive run, opening the door for aggressive dip-buyers to get long.

If we get a bounce going, $140 would be the first upside target. Above that, and $143.50 to $145 could be next, followed by the highs near $148.

On the downside, though, failure to find support could put $130 in play, followed by the 21-day moving average.

Top Trades for Tomorrow No. 4: Alibaba (BABA)

Top stock trades for BABA
Click to Enlarge
Source: Chart courtesy of TrendSpider

Last but not least, we have Alibaba (NYSE:BABA), which has been an abysmal performer. 

The stock is working on its fourth quarterly decline in the past five quarters, and the one quarterly gain in that stretch was a paltry 0.02% — and no, that’s not a typo!

Shares have declined in nine of the past 13 months and in the most recent month (November), we’ve seen a 22% haircut to the share price. Alibaba ended November in a monthly-down rotation, taking out the October low.

Amid the recent decline, BABA stock is now below its 2018 low at $138-and-change. If we reclaim it, it could put a reversal in play.

However, a further decline could put the $120 level on deck. With some divergence on the chart, that could set Alibaba stock up for a bounce if we get there. While it won’t always remain the case, bears remain in control at the moment.

On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.

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Economics

Beware of Fake News

Soren Kierkegaard, the Danish existentialist philosopher once remarked, “Geniuses are like thunderstorms. They go against the wind, terrify people, clean…

Soren Kierkegaard, the Danish existentialist philosopher once remarked, “Geniuses are like thunderstorms. They go against the wind, terrify people, clean the air.”

Source: ADragan / Shutterstock.com

Short-sellers often perform a similar function. Although they certainly are not all geniuses, their incisive analyses can swirl through the financial markets and terrify investors for a spell, while cleansing the air of misinformation and/or fraudulent behavior.

Because these financial thunderstorms can strike an individual stock like a thunderbolt, they usually singe every investor who happens to be in the vicinity.

Not surprisingly, therefore, short-sellers are about as welcome on Wall Street as a thunderstorm at a garden wedding. To put it bluntly, most folks hate short-sellers.

I don’t. I hate the misinformation and/or deception that causes investors to make ill-informed decisions…

Steel Yourself Against the Misinformation

Generally speaking, short-sellers are a fringy community of forensic analysts and truth-seekers. As a group, they expose the sort of misinformation that deceives investors. That’s a public service to all of us investors.

4 FREE Stock Picks for 2022

But sometimes, short-sellers themselves, are a source of misinformation — fonts of fake news.

In other words, not all short-sellers are created equal… neither are any other sources of investment information and “analysis” equally reliable.

This fact has never been timelier and more relevant than it is today, when social media sites funnel most of the minute-by-minute investment narrative that we consume.

Because of social media’s scope and dominance, deceptions can magnify quickly and “go viral,” often with mind-numbing speed and destructive power.

In such circumstances, getting to the truth can be challenging.

But a couple of simple steps can facilitate the process of fact-finding. Both of these steps are so ancient (and timeless) that they predate the internet itself:

  • Consider the source. Whenever you encounter a story that seems implausible or that conflicts with widespread opinion, check the source. Find the source of that story from the original source documents, if possible. Once you locate that source, check its history for honesty and accuracy. For example, a scientific observation from a Johns Hopkins University study is probably more reliable than one from National Enquirer.
  • Look for signs of intellectual honesty. Does the source of the story thoughtfully consider the “other side”? For example, does the source solicit information from third parties to corroborate its findings? Does the source present its findings matter-of-factly, while acknowledging portions that may be inconclusive or incomplete?
  • These two simple steps, by themselves, can usually help investors navigate deception and/or discover truth… like they did during the last two weeks when a short-selling firm attacked Standard Lithium (NYSEAMERICAN:SLI), a stock I have recommended in my investment services.

    On November 18, a short-selling outfit called Blue Orca Capital issued a negative report about the company.

    BREAKING: Investing Icons to Hold Emergency Stock Briefing 

    The report’s most damaging assertion was that Standard Lithium’s direct extraction technology could recover only 13% of the lithium that is contained in the brines it is processing — not the 90% recovery rate the company had been reporting.

    The stock plummeted 35% after Blue Orca’s report crossed the wires.

    But I issued an alert to my subscribers that stated the following:

    “If that assertion is true, it would be a truly damaging data point, perhaps even fatal to Standard Lithium. However, as recently as November 12, Standard Lithium submitted a detailed filing with the SEC that stated the following:

    “The final product lithium recovery is about 90%.

    “In other words, six days ago, the company informed a federal agency that its lithium extraction process recovers 90% of the lithium contained in the Arkansas brine it is processing.

    “Not 13%.

    “If the actual number is 13%, as Blue Orca Capital asserts, then the entire management team of Standard Lithium and its Board of Directors has committed a large-scale fraud…

    “A conspiracy and fraud of this scale and complexity seems unlikely…

    “More likely is that an ill-intentioned, or ill-informed, short seller has conspired to hammer the share price of a stock its firm has sold short.”

    In other words, I considered the source of the surprising story and deemed it to be untrustworthy. Furthermore, previous reports by Blue Orca about other companies revealed a consistent pattern of unreliable, one-sided analysis.

    Louis Navellier Issues New 2022 Warning to ALL Readers…

    Hours later, Standard Lithium issued a rebuttal to Blue Orca that confirmed my assumptions. You can view the entire release here: Standard Lithium Response.

    But the most important detail from the company’s response was that its direct extraction technology does, in fact, recover about 90% of the lithium that’s contained in the brine it is processing.

    The company stated flatly:

    “Blue Orca Capital’s interpretation of lithium recovery rates is incorrect and underestimates lithium extraction efficiencies.”

    Despite this comprehensive rebuttal, Blue Orca did not issue a mea culpa or concede defeat in any way. Instead, it simply doubled down on the identical claims Standard Lithium had debunked.

    The new attack from Blue Orca triggered another wave of selling that pushed the stock lower again on Nov. 22. But the selling pressure abruptly reversed on the day before Thanksgiving.

    That’s when the company announced a $100 million investment by Koch Strategic Platforms (KSP), a subsidiary of Koch Investment Group.

    Importantly, the press release that announced this investment included the following line:

    “[KSP’s] Direct Investment follows extensive due diligence into Standard Lithium’s LiSTR DLE technology, Demonstration Plant and project objectives…”

    Presumably, therefore, KSP possesses a more intimate and sophisticated understanding of Standard Lithium’s extraction technology than do the short-sellers at Blue Orca.

    The stock has been rallying ever since.

    An Early Warning

    To be sure, the short-seller’s attack on Standard Lithium was a frightening event. But ultimately, misinformation lost this battle.

    Furthermore, the company has emerged from that attack with its credibility intact and its investment potential greatly enhanced by a major new investment from what could become a major strategic partner.

    The stock remains what it was when I first recommended it to my subscribers: a speculative, unproven play on a “home-grown” battery-metals supply chain. But the stock has become somewhat less speculative in the wake of KSP’s $100 million buy-in.

    Now, before I let you go…

    2022 is on our heels, and we’re perhaps facing more apprehension than ever.

    With the new Omicron variant of the Covid-19 virus potentially bringing about city-, state- and country-wide restrictions, economic uncertainty, inflation and more, the end of 2021 is starting to feel quite a bit like the end of 2020.

    As such, it is critical that you hear what my colleagues, Louis Navellier and Luke Lango, and I see for the next year.

    And on Tuesday, December 7, at 7:00 p.m. EST, the three of us will give you our investing game plan for 2022.

    Click here now to reserve your spot — I’ll tell you more about it this week.

    Regards,

    Eric Fry

    P.S. Louis Navellier, Luke Lango and I will reveal the major events that will rock the markets in 2022. Will your money be safe? Sign up here for the 2022 Early Warning Summit and find out.

    On the date of publication, Eric Fry did not have (either directly or indirectly) any positions in the securities mentioned in this article.

    Eric Fry is an award-winning stock picker with numerous “10-bagger” calls — in good markets AND bad. How? By finding potent global megatrends… before they take off. In fact, Eric has recommended 41 different 1,000%+ stock market winners in his career. Plus, he beat 650 of the world’s most famous investors (including Bill Ackman and David Einhorn) in a contest. And today he’s revealing his next potential 1,000% winner for free, right here.

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