Federal Reserve Ruminations: Inflation Concerns Persist & other Highlights

Bullet Points, Highlights, Announcements

By Mark O’Brien

General:   

At their April 30 – May 1 meeting, according to its minutes released later this morning, Federal Reserve officials once again expressed concern that inflation wasn’t moving lower quickly enough, a theme that has started to weave its way into the “higher for longer” narrative expressed by the central bank through the last several meetings.  Moreso, participants assessed that while policy was “well positioned,” various officials mentioned a willingness to tighten policy further if warranted.

Energies:  

The Biden administration announced yesterday that it would sell off one million barrels of gasoline over the coming weeks from a strategic reserve in the Northeast, a move it said was designed to keep gasoline prices in check for consumers ahead of the July 4 holiday. The sale of the government-owned stock was mandated by Congress in the spending bill it passed in March, and will culminate in the closure of the reserve, which has facilities in the New York Harbor area and Maine.

Softs:  

After a brief reprieve at the start of the year, orange juice futures have resumed their ascent to new all-time highs.  The key fundamental factor was the announcement by Brazil, the world’s main producer (sorry Florida) forecast their production this current season is expected to yield a 24% decline in their harvest from the prior year and the lowest harvest since 1989.  The front July contract traded up ±90 cents/lb., a $13,500 per contract move in just the last 10 trading sessions to close at $4.633/lb.

Metals:  

After hitting an all-time record high above $5.19/lb. intraday on Monday – breaking a two-yr. record -July copper prices fell today in their worst single-day performance over the year to date, as the market decided to cash in on the commodity’s recent rally.  Over the last two months, copper futures have increased ± 25% from $4 to over $5/lb, a blistering $25,000 per contract move.  Today’s ± 30-cent/$7,500 drop likely forewarned greater volatility related to long-term supply concerns and the world’s efforts to aggressively mine this important industrial metal.

If you are a day trader, below you will see markets that our proprietary ALGO has identified as being more suitable for attacking either from the long side or the short side for the next trading session.

Questions? We are happy to help!

Daily Levels for May 23rd, 2024

Improve Your Trading Skills

Get access to proprietary indicators and trading methods, consult with an experienced broker at 1-800-454-9572.

Explore trading methods. Register Here

* This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading.