Tuesday , March 19 2019
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Vladimir Vyun

Vladimir Vyun

Vladimir is an online journalist with background in computer science and work experience in pension funds. He contributes news reports, fundamental analysis and sentiment forecasts to TopForexNews.com and CommodityBlog.com. His main specialization is the currencies of emerging economies and inter-market correlations with commodity and bond trading.

Articles by Vladimir Vyun

Crude Oil Struggles to Move Higher amid Conflicting Fundamentals

7 days ago

Prices for crude oil attempted to rally earlier today but have retreated to stay almost flat as positive fundamentals were fighting with negative ones. Currently prices are moving up again.
The pledge by Saudi Arabia to cut its oil output further in April remained a major supporting factor for crude. The unrest in Libya and US sanctions against Iran and Venezuela were also contributing to the upside momentum of the commodity.
Yet there were negative factors as well, like the downgrade of global consumption forecast by the US Energy Information Administration. The EIA reduced its world demand growth outlook for 2019 by 40,000 barrels per day to 1.45 million bpd and for 2020 by 20,000 bpd to 1.46 bpd.
The agency will also release tomorrow its estimates of US crude oil inventories last week.

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Crude Oil Jumps More than 1% As Saudi Arabia Cuts Output

8 days ago

Futures for crude oil gained more than 1% on Monday as Saudi Arabia pledged to curb its production even more. For a long time, production cuts by the Organization of Petroleum Exporting Countries and several non-OPEC producers were supporting oil prices. Usually, Saudi Arabia was the main proponent of such measures, and it looks like the Middle Eastern country continues to push for even more cuts. A Saudi official announced that the country is planning to produce less than 10 million barrels per day, while keeping exports below 7 million bpd in April, even though demand for Saudi exports exceeds 7 million bpd. The official said:
Despite very strong demand from international waterborne customers at more than 7.6 million bpd, customers were allocated less than 7 million bpd.
There were other

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Crude Oil Ends Week with Losses, Natural Gas Surges

18 days ago

Crude oil prices fell on Friday and ended the week with about 3% loss. Market specialists had different views on why crude declined. Some blamed poor US macroeconomic data, which signals about potential decrease in demand. Others pointed at recent sales from the Strategic Petroleum Reserves as the main negative factor for crude.
There was also positive news for the commodity. Baker Hughes reported that US firms decreased the number of oil rigs by 10 last week. Now, the total count stands at 843 — the lowest since May 2018.
Contract for delivery of WTI crude oil in April slumped as much as 2.57% to $55.75 per barrel as of 22:33 GMT on NYMEX today. Brent crude for delivery in May tumbled 2.02% to $64.97 per barrel on ICE.
At the same time, prices for natural gas surged. The likely reason

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Gold Drops After US GDP Growth Beats Expectations

19 days ago

Gold fell today and most other metals joined the decline. Market analysts explained the weak performance of the market of metals by the rally of the US dollar caused by faster-than-expected economic growth. US gross domestic product rose 2.6% in the fourth quarter of 2018 versus a 2.2% increase predicted by economists.
The market sentiment was negative after the US-North Korea negotiations collapsed. Risk aversion often lend support to bullion, but it was no the case today. It looks like the dollar has more success in attracting investors interested in safe assets.
Contract for delivery of gold in April declined 0.49% to $1,314.7 per troy ounce as of 22:18 GMT on COMEX today. Silver for delivery in May lost 0.8% of its value to $15.64 per ounce. Platinum was the only metal to avoid decline

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Donald Trump Hammers Crude Oil Prices

22 days ago

Markets were generally in a risk-on mode today, leading to gains of riskier assets. Yet one could not say that looking at prices for crude oil, which were sinking on Monday. Usually, crude rallies during times of risk appetite, but that was not the case today. So what was the reason for that? Most market analysts thought that it was a single tweet. Specifically, the tweet from US President Donald Trump urging the Organization of Petroleum Exporting Countries to prevent oil prices from rising too high:

Oil prices getting too high. OPEC, please relax and take it easy. World cannot take a price hike – fragile!
— Donald J. Trump (@realDonaldTrump) February 25, 2019

Some analysts were arguing with such point of view, saying that just one comment cannot lead to such a big decline. Whatever

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Metals Gain Despite Strong Dollar, Crude Oil Retreats from Year’s Highs

28 days ago

Gold and other metals were demonstrating surprisingly good performance today even as the US dollar was relatively strong. Usually, commodities priced in the US currency weaken when the greenback rises. Today, the dollar was among the strongest currencies on the Forex market, though it has backed off against some of its rivals by now, while keeping gains versus riskier currencies linked to commodities. Traders wait for news about high-level trade negotiations between the United States and China that have started in Washington today. Contract for delivery of gold in April gained 1.15% to $1,337.3 per troy ounce as of 15:12 GMT on COMEX today. March futures for silver advanced 0.43% to $15.81 per ounce. Copper for delivery in May jumped as much as 1.19% to $2.837 per pound.
Meanwhile, crude

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Gold Stabilizes After Dollar Falls on Dismal US Retail Sales

February 14, 2019

Gold stabilized today after falling earlier. The precious metal reduced its losses after extremely poor US retail sales drove the dollar down and led to speculations that the Federal Reserve will refrain from raising interest rates further.
Previously, bullion declined amid the positive market sentiment caused by optimism about Sino-US trade talks. High level US-China trade negotiations started today as US Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer traveled to Beijing to meet Chinese Vice Premier Liu He.
Contract for delivery of gold in April was almost flat at $1,314.4 per troy ounce as of 17:14 GMT on COMEX today. As for other metals, silver for delivery in March dropped 0.72% to $15.54 per ounce. Spot price for platinum was little changed at $786.5 per

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Stronger Dollar Hurts Precious Metals, Copper Supported by Sino-US Trade Talks

February 13, 2019

Gold and other precious metals traded lower today as the US dollar rallied. Stronger dollar makes it more expensive to buy commodities priced in the US currency, making them less attractive for traders. The greenback rallied despite stagnating headline inflation as underline inflation remained stable. Contract for delivery in April declined 0.37% to $1,309.2 per troy ounce as of 21:59 GMT on COMEX today. March silver dropped as much as 0.96% to $15.54 per ounce. Spot price for platinum went down 0.67% to $786.35 per ounce, while palladium declined 0.51% to trade at $1,398.56 per ounce.
Meanwhile, prices for copper rose thanks to optimism about the Sino-US trade talks. US Treasury Secretary Steven Mnuchin said about the negotiation that it was “so far, so good,” while US President Donald

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Grains Show Mixed Performance After USDA Supply Report

February 8, 2019

Grains showed mixed performance on the market today, with corn falling, wheat rising, and soybeans being little changed. That is surprising, considering that the February World Supply and Demand Estimates released by the US Department of Agriculture were bullish for corn and soybeans, while being bearish for wheat. The USDA did not release the report in January due to the lack of funding caused by the government shutdown.
The projected production of corn in the 2018/19 marketing year was revised to 14.42 billion bushels, down from 14.626 billion in the December estimate. That is because expected yields were revised lower to 176.4 bushels per acre, down from 178.9 bushels.
The expected soybean production was at 4.544 billion bushels, down from the previous forecast of 4.6 billion.

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Crude Trades in Range, Still Heads to Weekly Losses

February 8, 2019

Crude oil was trading in a tight range today, with West Texas Intermediate crude swinging between gains and losses, and the Brent grade rising a bit. Both grades were heading to weekly losses, though.
The news that the leaders of the United States and China will not meet before the March 2 deadline for a trade deal resulted in risk aversion on markets, hurting risk-sensitive assets. Signs of slowing economic growth across the world were also harming growth-related commodities.
While the oil production cuts by the Organization of Petroleum Exporting Countries and several non-OPEC countries, including Russia, were supporting crude, there was a push against the measures aimed to increase oil prices. US politicians are pushing the bill targeting the OPEC cuts. Meanwhile, Reuters reported that

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Crude Oil Rebounds After EIA Supply Report

February 6, 2019

Futures for crude oil rebounded after the decline earlier today even as a report from the Energy Information Administration showed a buildup of US inventories of crude. The EIA estimated that oil stockpiles expanded by 1.3 million barrels last week following the 0.9 million increase the week before. Yet some analysts were expecting an increase by more than 2 million barrels. Furthermore, gasoline inventories increased by just 0.5 million barrels, whereas specialists had predicted an increase of 1.6 million. And on top of that, distillate inventories dropped by 2.3 million barrels, while experts were anticipating a smaller increase.
Gains of the commodity were capped by the strong US dollar. It made assets priced in the US currency more expensive to buy, reducing their appeal to traders.

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Crude Oil Drops After API Report Shows Buildup of US Inventories

February 6, 2019

Prices for crude oil dropped today after a private report from American Petroleum Institute showed a buildup of US crude oil inventories by 2.5 million barrels last week. The actual increase was a bit higher than the analysts’ average forecast of 2.2 million barrels. The report followed Monday’s data from Genscape that showed an increase of stockpiles at the Cushing, Oklahoma, storage hub.
The Energy Information Administration will release an official government report today. Analysts had predicted ahead of the release that it will show a gain of US oil reserves by 1.3 million barrels for the previous week. The inventories increased by 0.9 million barrels the week before.
Futures for delivery of WTI crude oil in March declined 0.89% to $53.18 per barrel as of 12:17 GMT on NYMEX today.

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Crude Oil Declines as US Data Disappoints Again

February 5, 2019

Crude oil declined today as macroeconomic data in the United States was bad. Purchasing Managers’ Indices released by both Markit and Institute for Supply Management showed slowing expansion of the services sector. The data followed yesterday’s report about decline of factory orders. Signs of slowing economic activity are usually detrimental to growth-linked commodities like crude oil.
Losses were capped by supportive fundamentals, including the OPEC+ supply cuts and political unrest in Venezuela. The United States announced sanctions against state-owned oil firm Petróleos de Venezuela SA last month, and the European Union is likely to join the sanctions after most European countries recognized opposition leader Juan Guaidó, who declared himself president of Venezuela, as the interim

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Crude Oil Backs Off After Touching Highest Levels for 2019

February 4, 2019

Prices for crude oil fell today but only after touching the highest level for the year during the session. Market analysts named several possible reasons for the decline.
The most obvious reason for the drop of oil prices was the growth of US inventories of crude. According to industry data provider Genscape, US crude oil inventories rose by 943,000 barrels at the Cushing, Oklahoma, storage hub last week. The Energy Information Administration will release the official estimate of US oil stockpiles on Wednesday, as usual.
Another reason cited by experts was the report from the US Census Bureau that showed an unexpected drop of factory orders by 0.6% in November. Slowing manufacturing activity in the world’s biggest economy promises lower consumption of oil.
Still, supportive factors

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Crude Oil Ends Friday with Big Gains

February 1, 2019

Prices for crude oil rallied strongly today. Market analysts named several factors probably responsible for the rally. Most experts pointed at the US sanctions against Venezuela as the major reason for the gains of crude. Another one was the sharp drop of output from the Organization of Petroleum Exporting Countries. Some analysts speculated that the strong employment growth and the expansion of the manufacturing sector in the United States also contributed to the rally of oil prices.
The oil rigs count from Baker Hughes likely contributed to the rising prices as well. The agency reported that US drillers reduced the number of oil rigs by 15 this week. The decline offset the previous week’s increase of 10.
Futures for delivery of WTI crude oil in March rallied 2.88% to $55.34 per barrel

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Commodities Trade Higher on Friday

January 25, 2019

Commodities, including metals, were trading generally higher during the Friday’s European session. One of the possible reason for gains was the weakness of the US dollar, which helped assets priced in the greenback. The currency weakened on concerns about Sino-US trade relations, which intensified after Commerce Secretary Wilbur Ross said that the United States are still “miles and miles” from a trade deal with China. Contract for delivery of gold in April gained 0.24% to $1,289 per troy ounce as of 11:10 GMT on COMEX today. March silver advanced 0.49% to trade at $15.38 per ounce. Spot price for platinum rose 0.21%, while palladium declined 0.5% to $1,317.52 per ounce. Copper for delivery in March added 0.23% to its value to $2.6505 per pound.
West Texas Intermediate crude oil gained

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Crude Drops 2%, Dragged Down by Worsening Market Sentiment

January 23, 2019

Futures for crude oil fell about 2% on Tuesday as the market sentiment soured. There was a range of factors that led to worsening of the traders’ mood.
One of them was the Monday’s report that showed slowdown of China’s economic growth to the slowest pace in almost 30 years. The International Monetary Fund revised its global growth forecast for 2019 lower to 3.5% from 3.7% in the October’s forecast. US housing market demonstrated poor performance as existing home sales dropped 6.4% to the seasonally adjusted rate of 4.99 million in December, missing the average forecast of 5.27 million. And to top it all off, the United States canceled the trade talks with China scheduled for this week.
Futures for delivery of WTI crude oil in March dropped 2.29% to settle at $52.57 per barrel on NYMEX.

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Crude Oil Logs Small Losses After China’s Growth Slows

January 21, 2019

Futures for crude oil logged small losses today after data showed that China’s economic growth slowed last quarter. Annual growth in the fourth quarter of 2018 was the slowest in almost a decade. Furthermore, the growth for the whole 2018 was the slowest in 28 years. That is a bearish sign for crude oil as China is the world’s second biggest consumer of the commodity.
Losses of crude were limited as trading activity was subdued due to a holiday in the United States. Additionally, positive fundamentals that were supporting the commodity previously remained in place.
Futures for delivery of WTI crude oil in February fell 0.28% to $53.65 per barrel as of 11:47 GMT on NYMEX today. March contract for Brent crude declined 0.32% per barrel on ICE.
If you have any questions and comments

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Positive Fundamentals Lead to Daily & Weekly Gains for Crude Oil

January 18, 2019

Prices for crude oil rallied strongly on Friday due to a range of positive fundamental factors. The commodity was also heading to weekly gains.
One of such factors was the rumor that the United States are considering lifting additional tariffs on Chinese imports. While US officials denied such plans, markets remained in the risk-on mode. Together with China’s plans to stimulate growth, chances for an end to the Sino-US trade war promise stable demand from the world’s second biggest economy and a major consumer of oil.
Adding to the bullish momentum of crude was yesterday’s report that showed a decrease of OPEC oil production by 751,000 barrels per day to 31.6 million bpd in December. Saudi Arabia cut its output by 468,000 bpd to just over 10.5 million bpd, more than was expected. Today,

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Crude Oil Prices Down More than 1% on China’s Data

January 14, 2019

Prices for crude oil dropped more than 1% today after disappointing trade data released in China. While the Chinese trade balance surplus widened, both imports and exports declined. It is just that imports fell more than exports. Overall, the data pointed at slowdown in the world’s second biggest economy. And that does not bode well to the commodity, which is linked to economic growth. With that said, data compiled by Reuters showed that oil consumption in the Asian nation remained strong so far, with imports surging 30% in December from a year ago.
Market analysts were not particularly bearish on oil, hoping that production cuts by the Organization of Petroleum Exporting Countries and its allies should buoy prices. The OPEC and several non-OPEC countries, including Russia, agreed

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Metals Decline as Dollar Rebounds

January 10, 2019

Metals declined today due to the rebounding US dollar. While the currency fell yesterday on dovish monetary policy minutes released by the Federal Reserve, the greenback managed to rebound today thanks to hawkish comments from Fed Chairman Jerome Powell. That put pressure on commodities priced in the US currency. Nevertheless, CME FedWatch shows 65% probability that interest rates will stay unchanged by the end of the year. The outlook for no hikes in 2019 can yet hurt the dollar and provide support for the market of metals.
Copper had additional negative factor in the form of US-China trade dispute. US delegation is visiting the Asian nation in an attempt to find a compromise. The Chinese commerce ministry said that the talks “established a foundation for the resolution of each others’

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Crude Oil Volatile Ahead of Weekend, Heads to End Week with Loss

December 21, 2018

Prices for crude oil were rather volatile today. Initially, crude was following global stocks in decline, trading near the lowest levels since the third quarter of 2017 and heading to end the week with about 10% loss. The commodity and equities often move hand-in-hand because both are risk-sensitive assets. And today the market sentiment was negative towards risk. North American crude reversed losses later, but only to fall back down afterwards, while world’s benchmark Brent grade did not stop its downward movement at all.
Market analysts speculated that prices for oil were collapsing because traders did not think that the OPEC+ production cuts will be enough to compensate for increasing supply from the United States and to erase global glut. To counter that, Saudi Arabia is planning

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Aluminum Prices Sink to 16-Month Low As USA Lifts Sanction on Rusal

December 20, 2018

Back in April, the United States imposed sanctions on companies with shares owned by Russian businessman Oleg Deripaska, citing “malign activities” by Russia. Among companies suffering from the sanctions was Russian aluminum giant Rusal as well as its parent company En+. Prices for aluminum surged to the seven-year high after the announcement of the measures. Yet after lobbying from European countries, Washington agreed to lift sanctions if Deripaska relinquishes control of Rusal. That led to a surge of Rusal shares and a slump of prices for aluminum.
Aluminum for delivery in three months dropped 0.8% to $1,912 per metric ton on LME today. Earlier, the metal sank to $1,905.5 per ton — the lowest since August 4, 2017.
If you have any questions and comments on the commodities today, use

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Precious Metals Reverse Losses After Fed’s Dovish Rate Hike

December 20, 2018

Gold and other precious metals rallied today, reversing losses they have posted earlier on Thursday. Market analysts universally attributed the rally to the reaction to the policy statement and economic projections from the Federal Reserve, though different experts had opposing reasons for the exact logic behind the gains. Some argued that the dovish statement sent the US dollar down, helping commodities priced in the greenback as a result. Others speculated that Fed’s stance was less dovish than was expected, and caused risk aversion, increasing the attractiveness of bullion as a safe haven. Whatever the cause, precious metals demonstrated solid gains during Thursday’s trading session.
Futures for delivery of gold in February advanced 0.88% to $1,267.5 per troy ounce as of 18:10 GMT

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Gold & Silver Decline As Fed Sounds Less Dovish than Expected

December 20, 2018

Gold and silver fell during Thursday’s Asian trading session, while platinum and palladium managed to avoid losses. Bullion was under pressure after the Federal Reserve hiked interest rates. Such move was expected, but market participants were also counting on a dovish statement and significant reduction of the number of planned rate hikes in 2019. But the Fed was not as dovish as some people expected, and the number of planned hikes was reduced just by one to two hikes in total next year. That disappointed gold bulls as prospects for higher borrowing costs mean further downside risk for the metal.
Contract for delivery of gold in February declined 0.71% to $1,247.5 per troy ounce as of 3:04 GMT on COMEX today. Silver for delivery in March plunged 1.17% to $14.65 per ounce. At the same

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Gold Holds onto Gains, Other Metals Decline

December 18, 2018

Gold was attempting to hold onto yesterday’s gains today as the US dollar extended its decline. The greenback was falling ahead of tomorrow’s policy announcement from the Federal Reserve. While markets consider an interest rate hike at the coming meeting almost guaranteed, the outlook for the next year is far less clear, and that uncertainty was driving the US currency down. And that was beneficial to gold as the metal usually trades inversely to the dollar.
Other precious metals were less lucky, logging losses during the current trading session, even those that managed to rise yesterday. Unlike gold, which finds most use in jewelry and as an investment asset, other metals are used extensively in industry, therefore they often behave more like base metals, not like precious ones.
Contract

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Crude Oil Extends Losses, WTI Crude Falls Below $48

December 18, 2018

Prices for crude oil continued to sink today, extending yesterday’s losses, with the West Texas Intermediate grade falling below the $48 level. It seems fears of global glut and slowdown of word’s economic growth overshadowed whatever bullish factors oil had.
The Organization of Petroleum Exporting Countries and several nonmember allies agreed last week to cut oil production to support prices. But some of the members of the pact, most notably Russia, were increasing their output, not decreasing. And that on top of increasing supply from the United States. That is because the agreement will take effect only in January, giving the participants time to ramp up production before cutting it. With that said, Russian Energy Minister Alexander Novak promised that Russia’s oil production should

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Crude Oil Futures Sink on Global Glut Concerns, WTI Crude Below $50

December 17, 2018

Futures for crude oil attempted to rally during the Monday’s trading session, but failed, and ended the session with huge losses. US crude fell below the $50 mark and was trading at the lowest level in more than a year. Market analysts explained the sharp drop by a report from industry data provider Genscape, which showed an increase of crude oil inventories in Cushing, Oklahoma, the major delivery hub for US oil. The news reignited fears that the OPEC+ production cuts may be not enough to erase global glut of the commodity.
The US Energy Information Administration will release its official report on inventories of crude on Wednesday. Analysts polled by Reuters predicted that the report will show a decrease of 2.5 million barrels last week. If that is indeed the case, it will be the third

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Gold Gains at Start of Week as US Dollar Weakens Ahead of Fed

December 17, 2018

Futures for gold rallied on Monday. Other metals were mixed, with silver and palladium logging gains, while platinum and copper posted losses. The likely reason for such behavior was the fall of US and European stocks, which added to the risk aversion sentiment on markets. Another reason for the gains of bullion was the weakness of the US dollar, which made commodities priced in the greenback cheaper to buy. The US currency weakened due to uncertainty about Federal Reserve’s plans for monetary policy in the next year.
The rally was limited, though, as markets were counting on an interest rate hike from Fed on Wednesday. Higher interest makes it less attractive for investors to hold assets, which do not bear yield by themselves. Furthermore, despite the uncertainty about Fed’s policy going

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Symmetrical Triangle on Daily Chart of WTI Crude Oil

December 16, 2018

A symmetrical triangle pattern has formed on the daily chart of West Texas Intermediate crude oil. Such pattern occurs when prices consolidate, often after a period of moving in one direction. Usually, it suggests that the market took a breather before prices will continue to move in the same direction.
On the present chart, the yellow lines show the symmetrical triangle pattern itself. As crude was falling before the current period of sideways movement, the chart provides suggestions for a downside breakout scenario. The cyan line is drawn below the pattern, offset by 10% of the triangle’s width, and offers an entry position for bears. The green line is situated below the pattern by the triangle’s width and provides the profit target for short positions.
You can click on the image to see

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