A couple of opinions on currencies, energy, and gold
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Agreed. This was a good roundtable guys. Good thoughts and rationale on both sides of the dollar discussion and the long term dollar rising scenario.
I believe the rise in the dollar into the Spring/Summer will coincide with lows in the commodity sector, and then I think the overall trends reverse in everything. I believe commodities will head up in the summer, oil and gold and silver and the PGMs, I believe Uranium will be up, I believe copper will start rising. I believe this will coincide with the turning of the dollar down at a new high above 100 and starting to make a major correction down. Lastly I believe the stock market will make its final top this summer. Bonds are also set to reverse at that same point.
I also believe the soft commodities, food, agricultural plays like fertilizer and chemical companies, potash, and commodities like that should head up this summer. Some already are on the way back up now, but this should flat-line until the summer reversals.
On February 11, 2015 at 10:56 am,
Shad says:
So we are at 1219.40 right smack in the middle of the 1220-1218 zone. This is a crucial level of support that must hold if we are going to have any juice on the upleg to get past 1308. If we go down to 1207-1206 as Rick, Birdman, and Glen have mentioned they see as a target, it won’t pretty in the late spring/early summer.
On February 11, 2015 at 10:59 am,
Shad says:
If we can bounce from this level into the close today that would be much better and likely has marked the bottom. I’m willing to risk adding a little more JNUG at this level as a second tier. Going to watch very carefully the action from this point.
On February 11, 2015 at 12:02 pm,
Shad says:
Well we are continuing to hang in near 1220-1218 level, so the support is holding, but there sure isn’t much conviction to the upside. I’m happy to have hit the 1232 target for Friday and Tues, and this target around 1219 today, but I’m not seeing much strength in Gold. The stocks however are holding up better than expected so far. I though GDXJ would hit $24.79 on Golds move down to 1220-1218 zone, and it held above $26 all day so far. Many times the last 30 minutes is very volatile though, and I am waiting to add to my position in JNUG until I see how things go in this last hour of trading. Happy investing to all.
On February 11, 2015 at 12:59 pm,
Shad says:
Well, it held the 1220-1218 level all day, so I anticipate there could be a bounce from here and just added a little to my JNUG position. At this point I am about 50% in, and feel there was strength here that held most of the afternoon.
I wanted to point out that this level also correlates with the Jan 6th peak of 1219.30 pretty closely, so that was another contributing factor in my decision process.
What does everyone think the odds are that it will it bounce from here?
Looks like we got a whoope cushion bounce yesterday, but got a little better movement this Friday morning. Is this the beginning of the 1-2 week leg up?
I do think we are going to get there although I also think we may have to weather one more intermediate degree correction before the market can make that push to 5100.
Thanks, Gary. Looks like they’re in the mood to goose it this morning; Nasdaq futures +22 as I post this comment.
Took profits on my Q’s trade when the Nasdaq hit +50 today. I figure why be greedy.
Gary why are gold stock holding every decline in gold. That’s first time i’ve seen this in 3-4 yrs?
AGAIN, ON NO NEWS YET OUT OF EUROPE AS WELL AS ANYWHERE………………..these GUYS decide to pull the price of GOLD DOWN.
they are doing a good job………………..London fixing every day this week and last.
Agree with Gary. I think the miners are a buy here with another leg higher. I think some of those higher gaps will get filled this year. Call it a wave 4 or whatever you want but they still look like a bottom has been put in.
The miners held up better than expected on the last two drops in PMs, so if PMs do bounce higher now, that should put some wind in the sails of the quality companies, which are still insanely undervalued.
I’d prefer they call it a triangular table:)
Great show….those were good comments from Gary especially on gold and the miners. I agree with his thoughts for a double top on the dollar and had just posted the exact same comment before tuning in to the show. Also agree with Chris on Treasuries…looking for TLT to head back up by the first of next week.
I am watching for pop back up in TLT as well Birdman.
Are you and bird referring to the 10 year?
The trend seems to be every time it pops or tops, gold finds a bottom “entry point” to move higher. That is currently what im looking for.
I am looking at the Thirty year Glen on the daily and weeklies as a rough guide to entry points.
iShares 20+ Year Treasury Bond (TLT)
currency and metals prices are very strange and not rational.. That being said, swing trades are working, but am not commiting to more stocks this week. Preferred stocks and food companys are making me money. I think oil will drop again sometime this spring. When everyone hates the oil stocks [July??] Then i will probably buy the ones with stronger balance sheets. Love to you all and best of health. S
Chris, China had a historic high trade surplus last month at $60 billion. Devaluation of yuan will make it higher. It may translate to trillion dollar surplus with the rest of the world. If it was before US will pass sanctions against China. Do you think it is likely that China will do it anyway? I know the current strategy of China is to prevent capital flow intended by US to suck money out of rest of the world. Many publications talked about it. They even opened Hong Kong stock link with shanghai to suck capital back into China. Devaluation of yuan will facilitate capital flow out of China. It is against what Chinese government wants. Do you think China will play into wall street’s hand? I read stats that before the dollar rise in the summer, US trade deficit ex oil is already record high. It went up again in December, i think it something like 17%. Do you think US just ignore the harmful effects of dollar appreciation and not take any action to curb it?
Lawrence, China must do something to keep its own deflationary issues at bay. The path of least resistance already is of late to weaken the yuan to try to compete better against rapidly-falling euro and weakening yen alike.
The capital flight issue is two-fold; and I don’t think an issue, “net.” A lot of money has been leaving the country for a while now, to stay away from the tax collectors and investigations into kickbacks, corruption, etc. The government is slowing some of that down. Additionally, even some “honest” money is leaving for diversification/safety purposes; and no doubt because some closer to the ground over there worry about a deflationary implosion at some point, and want to cash in at least some chips from China’s multi-year debt-fueled boom while they can.
On the flip side, China’s dramatic opening of its stock and credit markets to outside, international investment should compensate for this all. In any case, the country still has official sector reserves that are monstrous; some $3.5 trillion or so.
AS for your last question, I’ve been asking the same thing aloud many times. Maybe it will take a further run higher for the dollar and that leading to rolling defaults in the oil patch, emerging market countries and elsewhere for the Fed to realize it can’t afford to stay out of the new currency war. We’ll see. But it’s really tempting fate to keep up this “Rate hike or bust” attitude given what it will inevitably lead to.
Thanks for the response Chris. China needs a real deflation since the increase of price has virtually wiped out most of people’s saving which is 30-40% of the income. Chinese are big savers. Recently leaving the country by corrupted money is getting difficult since any money leaving is checked. President Xi setup traps to lure people in to it in order to find out corruption. so they tried to use private institutions to move money out. Last year a lot of these underground banks were busted on the name anti-organized crime. I think it is getting more and more risky. president Xi has been through many assassination attempts and finally he starts to get some support amount people. I find that before people made jokes on him and more jokes coming out now are harmless or even admiration. They just executed a billionaire a few days ago for organized crime.
As for rate hikes, I feel it is just talk. I feel it not likely in current strong dollar.
All other resource producing countries are hiding behind currency devaluation strategy. I am not sure how US shale companies can survive without a bail out? Exporters must feel that wind is blowing in their face
Even we don’t consider capital flight a big problem but it seems very popular topic amount Chinese economists. Most of them think this is a war.
Gary, you hold USO. It is based on near month future contract. Do you think the current contango will eat into the fund just like 2008? As the fund move to the next month contract, it will lose a portion due to higher forward price. Just wondering. I lost near 20% in a beta fund in 2 month even when oil jumped from 36 to 54 dollars.
Great roundtable, guys! I’m getting freaked out in the miners, so it’s probably time to buy. I doubt we top 1308 but fingers crossed…
compared with yesterdays show todays was a yawner…
a day without postma is a day missing him..
I think Ukraine is about to spin out of control.
Then how can a few thousand NATO troups fight a million strong Russian troup? There is no worry with China so the troup can all move to East Europe. Unless using nuclear weapons, US has to send half million troups. I don’t think German and French will be actively fighting. Then Ukraine is the only one facing Russia. They have no chance.
Never underestimate the might of force that the US canbring to bear. Yes, Russia is powerful and has a skilled military… but the US has massive force.
Let us all hope and pray that peace is the outcome.
No doubt that US has mighty force, Russia has as well. US has not won a war against Russia and China. It lost both Korea and Vietnam when Russia and China got seriously involved. I am sure there is no way to win a war around Russia against Russia. The Russians have durability and US does not. Russian’s will to defend itself is unparalleled. You know that if you look at 27 million deaths out of 120 million when they fought Germans.
ditto……Lawrence……..
they shall raise rates several times soon..they sniff inflation.
ukraine is spinning quickly…
great suffering we do not cover..
Bob UK, you have heard of china…
Been buying back XOP the last 2 days.
Great roundtable discussion, thanks Cory.
Guys I’m following $COMP; trading the QQQ’s. Nasdaq poked through 4800 this morning and it looks like resistance going back from late December. Or, could it be a breakout noting that Apple seems to be attracting a crowd. (?)
Gary, is your Nasdaq 5100 call still in the cards? The chart does appear to have elements of a launching pad…