Product
October 15, 2020
HRC & Busheling Futures Power Higher, But Something's Gotta Give
Written by David Feldstein
Editor’s note: SMU Contributor David Feldstein is president of Rock Trading Advisors. David has over 20 years of trading experience in financial markets and has been active in the ferrous futures space for over eight years. You can learn more at www.thefeldstein.com or add him on twitter @TheFeldstein and on Instragram at #thefeldstein.
Q3 U.S. GDP grew at an annualized quarter-over-quarter rate of 33.1% and was a combination of 1) pent-up Q2 production, 2) government stimulus and 3) Q3 production times some coefficient less than one due to the pandemic-induced recession. The industrial production index below illustrates the sharp Q2 drop followed by this Q3 recovery, which brings us around halfway back. Most of the pent-up Q2 production has dissipated and there is no additional government stimulus for now. Without these boosters, expect flattish trend growth moving forward.
