The major precious metals, the wide US equity Index, and Asian stock markets all rose to reach new all-time highs yesterday.
- There will be a release today of US CPI (inflation) data, which is expected to remain the same at an annualized rate of 2.7%. A fall could boost stocks, while a rise will likely boost the US Dollar.
- Markets continue to be dominated by precious metals, although its only the two major precious metals that are really doing anything interesting.
- Gold - peaked at $4,630 (a record high) and is now trading back below $4,600 after making a bearish retracement. I am long of Gold and most trend traders will be also.
- Silver - peaked at $86.35 (a record high) and is now trading lower (just above $85( after making a bearish retracement. I am long of Silver and most trend traders will be also.
- Stock markets are mostly bullish, with the S&P 500 Index reaching a new record high yesterday just below the huge round number at 7,000. The Index has sold off a bit since then, but still looks bullish, and trend traders will be long here. There was also a new record high yesterday in the MSCI Asian Index, with several Asian equity indices also making new all-time high prices.
- In the Forex market, since today's Tokyo open, the strongest major currency has been the New Zealand Dollar, and the weakest has been the Japanese Yen, which has fallen to an 18-month low on rumours that a snap general election will be called. The USD/JPY currency pair rose to nearly touch the ¥159 handle, trading at its highest price since July 2024. I have been long of this currency pair for a while, and trend traders will be too.
- Industrial Metals Copper and Aluminum continue to trade near their recent highs but are not making new highs. There is still a strong bullish case here. A relatively accessible way to trade these industrial metals is to access ETFs such as CPER and ALUM. Note that the CME offers a micro Copper future sized at only about $15,000.
- It seems clear there is a full-blown uprising against the regime in Iran, with reports of mass casualties amongst unarmed protestors. President Trump is continuing to signal that the USA will take military action to help the revolt, but no obvious action has been taken yet and may not be. Polymarket shows a 57% chance of a strike on Iran by the end of January by either the USA or Israel, which could easily trigger a regional war.