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2016 Commodity Outlook: More Pain For Hard Assets?

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With 2015 going into the history books soon, it’s the perfect time for a 2016 commodity outlook. – PowerPoint PPT presentation

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Title: 2016 Commodity Outlook: More Pain For Hard Assets?


1
Commodity Trading Research
2016 Commodity Outlook More Pain For Hard Assets?
2
Welcome to Commodity Trading Research Your
premier site for fundamental and technical
analysis for profitable Commodity Trading. For
more info on Commodity Trading Research visit our
website www.CommodityTradingResearch.com
3
  • Get Your Free Report On The 3 BEST Commodity
    Stocks for 2016!
  • Well tell you about this
  • Special Offer
  • at the end of the video!

4
  • Hi, My name is Justin and Im with Commodity
    Trading Research, today were reviewing our
    recently published article

5
  • 2016 Commodity Outlook More Pain For Hard Assets?

6
  • No doubt about it, it was one heck of a rough
    year in the commodity space. Energies, precious
    and industrial metals, grains, softs- each
    complex has assets that are trading at or near
    multi-year lows.

7
  • One look at the CRB indexsums up the extent of
    the downturn

8
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9
  • This closely watched index, which represents an
    equally weighted basket of the worlds 19 most
    important commodities, is down nearly 30
    year-over-year.

10
  • And when 2015 finally draws to a close in a few
    weeks, its unlikely performance improves much,
    if at all.
  • Fact is, commodities have been one the worst
    asset classes to be invested in for quite some
    time.

11
  • With the exception of a few fundamentally strong
    commodities like cocoa and cattle, the space has
    been demolished the past year.

12
  • Is there any hope for commodities in 2016?
    Depends on who you ask Some see brighter days
    ahead, while others are just as gloomy as ever.

13
  • Heres my take

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  • I believe there are some big profit opportunities
    coming up in select assets. However, next year
    must be carefully navigated according to each
    commoditys supply/demand balance.

15
  • In other words, a fewdeeply oversold commodities
    may see a sharp recovery, while others will
    likely remain mired in the muck.

16
  • Which assets are best poised for an upturn?

17
  • The energy markets holds some of the strongest
    upside potential. As you may know, oil and
    natural gas prices have been decimated this year.

18
  • Thanks to the US oil boom and the abundant
    supplies it brought forth, both commodities are
    trading at half the price they were last year at
    this time.
  • But heres the deal

19
  • Low prices are in process of curing low prices.
    Judging by the huge downturn in the Baker Hughes
    rig count, its clear US crude exploration is
    hitting the skids.

20
  • That means the ongoing US oil production slowdown
    will likely start accelerating in 2016. Of
    course, the quicker production declines the
    faster the oil market will come back into balance.

21
  • And when it does, West Texas Intermediate will
    likely rally back over 60 a barrel.
  • What about natural gas?

22
  • Since a large portion on US natural gas
    production goes hand in hand with crude
    exploration, I expect the commodity will start
    seeing a production slowdown as well.

23
  • And with natural gas usage expanding, its hard
    to see how the commodity stays at these ultra-low
    prices under 2.50 mmBtu.

24
  • For more information on natural gas, and ways to
    potentially profit from a rebound in the
    commodity, check out my newly released free
    report.

25
  • Unfortunately, my outlook on the metals space
    isnt nearly as optimistic

26
  • With the US Federal Reserve bound and determined
    to raise interest rates this year, investor
    demand for gold and silver has taken quite a hit.

27
  • Anyone watching the sharp downturn in these
    metals the past two weeks knows exactly what Im
    talking about.
  • Heres the deal With inflation still nowhere to
    be found, its likely gold and silver pricesslide
    even lower next year.

28
  • In fact, I wouldnt be surprised to see gold drop
    to 1,000 an ounce in the next 12 months. Believe
    it or not, this gold producer is making plans for
    gold at 900.

29
  • But there is a caveat to that gloomy metals
    forecast

30
  • If theres a big slowdown in the global economy
    next year, which takes the US economy down with
    it, well likely see the Fed return to an
    extremely accommodative policy.

31
  • That may mean another round of quantitative
    easing (QE4), or even negative interest rates.

32
  • Such a risk on environment would likely bring
    capital pouring back into the metals space, as
    well many other commodity complexes.

33
  • Bottom line

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  • Next years commodity outlook is highly dependent
    on the US central bank and its policies. Stay
    tuned to Commodity Trading Research as well
    continue our 2016 commodity outlook in next
    weeks article.

35
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36
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  • Commodity Trading Research.com

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37
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