U.S. Stocks vs. Bonds: Are Diverging Valuations Signaling a Shift? 
Oil Prices Dip Slightly Amid Focus on Russian Sanctions and U.S. Inflation Data 
Gold Prices Fall Amid Rate Jitters; Copper Steady as China Stimulus Eyed 
Global Markets React to Strong U.S. Jobs Data and Rising Yields 
Urban studies: Doing research when every city is different 
Trump’s "Shock and Awe" Agenda: Executive Orders from Day One 
2025 Market Outlook: Key January Events to Watch 
Energy Sector Outlook 2025: AI's Role and Market Dynamics 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
Moody's Upgrades Argentina's Credit Rating Amid Economic Reforms 
China’s Growth Faces Structural Challenges Amid Doubts Over Data 
U.S. Treasury Yields Expected to Decline Amid Cooling Economic Pressures 
Goldman Predicts 50% Odds of 10% U.S. Tariff on Copper by Q1 Close 
Gold Prices Slide as Rate Cut Prospects Diminish; Copper Gains on China Stimulus Hopes 
S&P 500 Relies on Tech for Growth in Q4 2024, Says Barclays 
Wall Street Analysts Weigh in on Latest NFP Data 
Gold attempts to bounce back above $1,425/oz level from the last 2-3 days, the surprisingly positive US nonfarm payroll numbers sparked some rethink about US rate cuts.
There are two notable exceptions in the declining turnover pattern shown in the 1stnutshell: Bund and Gold futures. For Bunds futures, the turnover is not only up vs. last year but also sequentially between Q1 and Q2. Gold futures turnover is down from last year, but the increase between Q1 to Q2 has been the biggest across asset classes. This suggests that more flow has been behind the repricing of these two assets classes in recent months.
OTC Updates for Bullion Market: Please be noted that the positively skewed IVs of 3m XAUUSD contracts are still indicating the upside risks, bids for OTM call strikes up to 1520 signifies hedging sentiments for the higher price risks. One could also see a bullish risk reversal setup. To substantiate the above bullish sentiment, risk reversal (RRs) numbers indicate an overall bullish environment.
The above risk reversal numbers have been known as a gauge of gold’s underlying market for bullish opportunities. Well, we know that options are predominantly meant for hedging a probable risk event in the future.
Options Strategy: Capitalizing on the minor shift in risk reversal numbers of gold in the short-run and bullish neutral risk reversals of longer tenors, we advocate longs in gold via ITM call options.
Buy 3m XAUUSD ATM -0.70 delta calls on hedging grounds. If expiry is not near, delta movement wouldn’t be 1 point increase with 1 pip in the underlying movement, which means if the spot moves 1 pip, depending on the strike price of the option, the option would also move less than 1. Thereby, in the money call option with a very strong delta will move in tandem with the underlying.
Alternatively, on hedging grounds, we advocated long positions in CME gold contracts. We now like to uphold the same strategy by rolling over the contracts for August’19 delivery as we could foresee more upside risks. Courtesy: Sentrix, CFTC, JPM & Saxo
