To The Moon

When the market saw signs of easing in the Israeli-Palestinian conflict, talks on a hostage-swap ceasefire between Israel and Hamas collapsed.

Although this incident has only slightly reacted to gold and silver prices at present, the actual impact on the financial market does not stop there. At present, there is only the last base of Hamas-Rafah. If Israel forcibly penetrates, it will definitely hurt a large number of innocent people. At that time, it may arouse greater international opposition and corresponding actions.

At present, Israel is unwilling to make concessions to attack Rafah, and it will have an impact on the financial market when it does it. We may see the market in March-April replicated in May-June, that is, the US stock index adjusts, precious metals are strong, and crude oil is strong again. And it is May now, no matter whether the curse of sell in may in US stocks reappears or not, everyone needs to be cautious.

1. Has the correction of precious metals been completed?

In a state of continuous conflict, precious metals are easy to rise but hard to fall. However, the main increase is not estimated to come from gold.

The speculative value of silver in the current market is higher than that of gold. Although the follow-up of gold will not be too weak, a volatile market is inevitable. 2300 points have been confirmed by the market as a strong support price for gold prices. If it does not break through, there is no need to be bearish on gold prices.

If it is held by bulls, it is necessary for the market to fully understand this point. The expansion of the Palestinian-Israeli conflict is expected to disappear. Given that the news of the conflict is unpredictable, it is not recommended to short the price of precious metals at this stage.

2. Crude oil ushered in a stage correction

I have emphasized to you before that the key market of oil prices will not happen until the second half of the year, so it is too early to rise before, and the adjustment will not be too small.

At present, the U.S. strategic crude oil reserve is in a hurry, and the Biden administration can't wait to "replenish the reserve". In order to avoid the market price rising sharply when the "replenishment" is caused, when the U.S. intends to replenish the strategic oil reserve, it will generally create some negative news, so Iraq said in June It is against this background that it will not support continued OPEC production cuts in the month.

According to the above logic, this oil price adjustment will be carried out with a target of US $70 or below. The key depends on whether there is a bigger moth at the OPEC meeting in early June. In general, the opportunity for an overall rise in oil prices still needs to wait.

3. Interpretation of the monthly supply and demand report of agricultural products

The May supply and demand report was released on Friday. As the first supply and demand report for new crop agricultural products, it naturally attracted more attention from the market.

As a result, the USDA lowered its forecast for U.S. corn and wheat production, and raised U.S. soybean production. The market price also reflected the data well. When the price of agricultural products began to rise during the May 1st period, it established a strong pattern of agricultural product prices from February to June.

The only difference is that if the report data is positive, it will rise more, and if the data is negative, it will not rise or rise less, but the final result will still rise. Soybeans still have the bullish factors of the floods in Brazil, and the decline is an opportunity to intervene. In June, there will be a report on the decision of the planting area, which is likely to be the stage high point of agricultural products, everyone pay attention.

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