Market Commentary from Gary
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Marc Faber; Gary Shiller; and, The Three Musketeers are calling for a market down turn in the early Fall. Listen to what Gary has to say. And, as always, what do you all have to say?
Never mind, my audio buffered before the end of the audio, I had missed the very end of the audio. I just reset it and listened to the end and Cory you asked him the very same question. Thanks guys.
Happy Canada Day Cory. Thanks for working on your day off 🙂
Great thought about the question Shad 😉
I do love Canada Day but the Wednesday day off is kind of pointless… I think we are taking a break on July 3rd for the July 4th long weekend.
Good plan. You deserve some time off man.
All the bears on one side of the boat – wonder who that works out – ha ha.
Very valid point Tyler. Usually when everyone is in the same camp, the market will do just the opposite of what everyone thinks. However, sometimes just the worry that a crash is coming can become a self-fulfilling prophecy, so if some selling starts in the Fall, it may turn into a waterfall decline if everyone believes “The Correction” has arrived.
It will be very interesting to see how it all plays out.
Tyler,
Actually sentiment still has lots of room to drop before we run out of sellers and put in an intermediate bottom. The intermediate score (a combo of multiple intermediate degree sentiment indicators) is pretty much dead neutral at 55%.
Good point Gary. I think sentiment levels are always important in these markets.
There are a lot of people calling for a correction but then again a lot of these people have been calling for this for years. Eventually it will come the question is when.
Cleansing faze have been in the PM markets for the last 5 years.
Very true, Seems like there might still be some cleaning needed.
When the Fed starts raising rates, and they will probably at least two times this year, it etches in stone that there will be no future QE. The days of QE are over for good. After the market crashes this fall and winter, it will have be real fundamentals that bring it back. Stocks in 2016 will be ill and commodities and PMs will be a great place to be.
Raising rates and QE don’t go together. Falling oil prices will create the junk bond bubble that will create the market crash.
No fed hikes this year. USD will continue to strengthen as other countries continue to pour money into our treasuries and stocks.
Interesting scenario. Agree the Fed will raise, if for no other reason than to save face. From there though, I see no reason why they couldn’t reverse themselves, depending on how things turn out. If rates go up even .5% it will smother vehicle and home sales on the lower end. I think that’s where you will see them try to retrieve past performance. JMO. Thanks for posting yours.
Attempted to reply to Chartster.
Couldn’t agree more.
Check out the softs, corn and wheat. Birdman did.
At this point in time, I would not even consider additional QE in my thinking. If the FED did implement another QE program, they would lose all credibility forward.
Anyhow, for my thinking, I would expect some type of correction and an allocation toward other sectors as the economy shifts from a “Zero Interest Rate” economy / market to a growth aligned market. As for the indices, I am not certain that this means much higher highs because today’s leaders prices may fall back to realistic valuations while undervalued companies begin to rise. So at this point in time, I am not in the “Bubble Idea Camp.”
As for the correction, there is no doubt that we are long overdue. It will happen at some point in time and now the probability is higher given the break of some recent lows and trendlines. As for a 20% correction, let’s take it one step at a time. Let’s see if they can get this market down to SPX 2000 and we can evaluate. First we need to break 2040.
I am surprised FED still has any credibility left. QE is all about funding federal borrowing. US is still borrowing like mad. Forget about the so call deficit. Look at the national debt. FED has been talking about raising rate for last many years. So far all bark no bite.
Like the Greeks, they have unshakeable faith in the system. Even there have been so much warning, they still keep their money in the banks, Until it is late.
I am not surprised that the Fed still has credibility right now. I continue to believe the Fed is the strongest central bank in the world. Plus as you said the Greeks still have faith so why wouldn’t Americans… not saying it is right but just the way it is.
It only mean people are stupid. Most people will be Losers.
Greeks should not have any confidence. They need to wake up and protect themselves
I’m with you in the rate hike boat Chartster. I have even bet a couple buddies that it will happen this year.
Further consolidation in the mining industry
Auryn Resources to Acquire North Country Gold
June 30th, 2015
http://www.aurynresources.com/news/auryn-resources-to-acquire-north-country-gold
Also a big merger in the Lithium space this week. M&A is heating up.
Western Lithium and Lithium Americas announce Merger, Consolidating Strategic Lithium Deposits in North and South America
Jun 30, 2015
* I’m reposting this in case anyone may be interested. It has taken me a while to go through all the video and PowerPoint presentations included on this site, but there is ton of really good content on PMs and mining companies.
On June 27, 2015 at 8:13 am,
Shad says:
By the way, there is a 20 minute video with Powerpoint slide presentaion on each of the following companies or presentations from the European Gold Forum. Well worth checking out the companies on this list.
** CFS don’t miss the Mandalay Resources presentation 🙂
I also was impressed by all the silver miners in Ballroom 3 like Endeavour, First Majestic, Avino Silver & Gold, Sierra Metals, Mag Silver, Kootenay, etc….
8:30 a.m. Dr. Martin Murenbeeld – 2015 Gold Price Review & Forecast
9:20 a.m. Royal Gold, Inc.
9:40 a.m. Kinross Gold Corporation
10:00 a.m James Turk – Gold in the International System
11:00 a.m. Centerra Gold Inc.
11:20 a.m. Agnico Eagle
11:40 p.m. Romarco Minerals Inc.
12:00 p.m. Networking Buffet Luncheon
St Andrew Goldfields Ltd.
Endeavour Silver Corp.
Wesdome
Mandalay Resources Corp.
Reservoir Minerals Inc.
MAG Silver Corp.
Asanko Gold
Silver Standard Resources Inc.
Pan African Resources PLC
First Majestic Silver Corp.
Endeavour Mining Corporation
Sierra Metals Inc.
Amara Mining PLC
SilverCrest Mines Inc.
Orezone Gold
Avino Silver & Gold Mines Ltd.
Aureus Mining Inc.
Orvana Minerals Corp.
Metallon Gold
Vista Gold Corp.
Caledonia Mining
Kootenay Silver
http://www.europeangoldforum.org/egf15/egf15-webcast/egf15-webcast-stream.html
On June 27, 2015 at 10:44 am,
Matthew says:
Thanks Shad. I think everyone should start with James Turk’s presentation.
I was at Beethoven Strasse in Zurich.
Thanks, Shad. You saved me from making a trip to Europe where I might’ve been killed by terrorists.
Ha! funny Bonzo Barzini. Yes this is a safer way to go to this conference.
And with the money I saved on travel I can buy more AG, EXK, SSRI, RGLD, SVC, AEM, and Vista Gold. They should be ten-baggers.
Good list of companies Bonzo.
Thanks for the link Shad. I like a few of those companies. Most have been around for a long time and look like they should survive this bear market.
Thanks Shad.
Glad to share. There are some really good presentations on that site from the European Gold Forum.
Yes, great link- Thank-You-Shad!!
Enjoy!
No reason to doubt Gary’s call. But there is still some hope:
http://peterlbrandt.com/a-bullish-technical-case-for-silver/
Peter is a good technician as well. I respect his calls because he has no issues calling for a fall or rise.
HECLA is getting hammered and has really given up the relative strength it had been exhibiting over the last year pretty rapidly. Yikes.
Yep, that’s why I advocated selling in May and going away during the summer sell-off. Many Silver miners are getting hit hard this week. Coeur is down even further for example.
It looks like Hecla and Mandalay are still hanging on at top, but Silver Standard Resources has ousted Fortuna for 3rd position.
Silver Miners Composite Chart for some of the Majors and Mid-Tiers.
http://stockcharts.com/freecharts/perf.php?AG,FSM,HL,PAAS,CDE,SSRI,TAHO,FNLPF,DBEXF,MND.TO#
Here’s a nice chart of some smaller producers and explorers in the Silver space. Mag Silver has moved into the #1 position out of this group, with Sierra Metals in #2. They both had good presentations on the European Gold Forum link up above:
Featuring the last 200 days with : Scorpio, Mag Silver, Minco, Alexco, Silvercorp, Trevali, Mirasol, Impact Silver, Santacruz, Sierra Metals.
http://stockcharts.com/freecharts/perf.php?SMNPF,MVG,MISVF,AXU,SVM,TV.TO,MRZ.V,IPT.V,SCZ.V,SMT.TO#
Here’s another update with a different lineup of small producers and Mid-tiers, with the following companies (Great Panther Silver, Aurcana, Alexco, Hecla, Americas Silver Corp, Fortuna, Avino Silver & Gold, First Majestic, and Endeavour Silver)
http://stockcharts.com/freecharts/perf.php?GPL,AUNFF,AXU,HL,SMNPF,SZSMF,FSM,ASM,AG,EXK,EXLLF#
One last chart for the day on Silver explorers & small producers:
Excellon, Defiance Silver, Alexco, El Tigre Silver, Minco Silver, Kootenay Silver, Avrupa Minerals, Bear Creek, Santacruz Silver, and Silvercorp
http://stockcharts.com/freecharts/perf.php?EXLLF,DEF.V,AXU,ELS.V,MISVF,KTN.V,AVU.V,BCM.V,SCZ.V,SVM#
Defiance Silver and Kootenay Silver have really broken out from the rest of the pack lately. Kootenay also has a good presentation on the European Gold Forum link up above.
Spanky,
PMs should pop real good right here. But the bear is alive and well. Rhodium is getting a washout right now, it’s already down to 845. It’s usually leads the PMs two or 3 months.
Even though I am out of miners completely, I still hope Peter Brandt’s triangle reversal comes to fruition. Silver is probably worth a bit right here as we are right on the lower trend line that Peter drew.
“buy right here…”
When will the rumors of the Greek gold reserves being sold make the headlines?
That should parlay into some handsome profits for the degenerates of finance.
That news is not being picked up anywhere. That said I would not be surprised if no one cared when it was reported.
Shad,
Thanks for all the excellent info!
Before the bottom is here on metals and miners, I would and am thinking about two types of investments in the mining space. There are countless companies to look at for all of us. My strategy is to build my own ETF of junior miners. Maybe 10 or so ( too many companies, too many charts to watch ) And then have a group of royalty companies.
I’m already going to be in HUI, GDXJ, and SILJ.
I with Al when he day to focus on and drill down on what’s best when it’s time to buy.
Maybe we need a top 10 discussion based on category?
Just thinking it would be good.
That would be a good start because the different mining shares either look good or horrible.
That is actually a great idea Chartster, and a productive way for us to all work together. There are just so many companies out there and people have so many criteria (market cap, share structure, jurisdiction, liquidity, explorer, small/Mid/Major producer, Gold, Silver, polymetallic, etc… that it would be hard to just pick 10).
Maybe there could be a top 10 explorers that are takeover targets, top 10 explorers that may actually make it into production, top 10 small producers, top 10 mid-tiers, and top 10 majors for Gold. Silver mining is a much smaller list but I still have 47 companies on my watch list.
Normally I try to just throw a few at a time out to see what kind of feedback gets posted. Many like Matthew, Brian, CFS, Dan Calgary, Irwin, Lawrence, and our own Doc Postma throw out good stock picks all the time, but we all have different criteria and sometimes enter positions in the exact same companies, but at different times.
I’m always up refining my list, considering someone’s recommendations, debating charts for entry points or support/resistance levels, and think its a great way to learn about new trading ideas on this forum.
July/Aug is when I’ve been waiting to go shopping, but I’m still refining which companies I want to hold for the long term, and which ones I want to swing trade for short term windows of time.
Let’s keep working on it!
I like your thoughts with this.
Maybe there could be a top 10 explorers that are takeover targets, top 10 explorers that may actually make it into production, top 10 small producers, top 10 mid-tiers, and top 10 majors for Gold. Silver mining is a much smaller list but I still have 47 companies on my watch list.
Cool. Anyone else that would like flush out some of these mining stock picks over the next few weeks and give some thumbs up or down, or ones a good valuations, or ones poised to rise when we finish the summer slump would be appreciated.
Thinking but not spelling, lol
In my work, gold has two different opposing technical views at the moment. I cannot weigh one case much better than the other, so it is a neutral situation until more evidence is presented. If it continues downward, I would be interested around the $1,090 level. If it reverses to the upside, I would be looking for $1,225 to confirm support. Since we are and have been in the band of $1,200 to $1,170, there really isn’t anything for me to do in this space.
I do not like the massive bearish divergences between silver and the mining companies; however, this could be getting stressed due to the end of the quarter and will take a few days to straighten out since the holiday.
You are absolutely right Doc. The metals continue to be range bound. I think if they can make it through the summer that would be a good thing for a fall or winter rise.
Good thoughts Richard. Many investors are in a watch mode at present, but things can break up or down quickly in these markets. Honestly I think things are just going to remain in a descending wedge for a while.
**For anyone that may be interested, this video presentation from 2 weeks ago is still on target, and Jordan addresses his perspective on why he feels sub $1000 gold is not very likely, unless it is just a momentary dip below it. He sees the strongest support in the $1050-$1000 zone. It’s a pretty good short presentation he ends the presentation with a falling wedge discussion as well. I tend to agree with this outlook the most, as I’ve been targeting $1044.70 as support zone.
This is also very similar to Doc Postma’s outlook, and Gary’s outlook, so there is definitely some synergy in some of the analysis lately.
Precious Metals Market Update: A Technical Update on Gold – Jordan Roy-Byrne
BY COLLIN KETTELL ON JUNE 17, 2015
http://palisaderadio.com/precious-metals-market-update-a-technical-update-on-gold-jordan-roy-byrne/
I’m pretty confident the bottom of PMs will be in September.
The closer we get, the bigger the drops.
Maybe sooner, silver wants to test that spike low from 11/30/2014. This could be the reason that HL and select others are getting smashed. This would leave $1,090 open for gold.
Spike low of $14
Why keep project lower price while sovereign default is happening. We need to add PM regardless the price.
Big win for Americans, big loss for crony capitalists!
These are one of those bounce days that I cannot believe the SPX is up 0.5% because almost everything on my board is down. Just shows how some positive banks, healthcare and consumer staples can really influence and carry the averages considering the energy sector is down 1.5%.
The Shemita is coming in September:
https://www.youtube.com/watch?v=tXei0Zb3dxM
Complete book “the harbinger”
https://www.youtube.com/watch?v=I5jrK9rbZ6s
GDXJ just might close its April 1st gap as soon as tomorrow. I hope it does.
Very good GDXJ discussion on Rick’s blog Matthew. I am wondering if GDXJ will hit that $22.70 or $22.43 level on Thursday as well.
JDST has gone wheels up! Afterburner still lit! Climbing for altitude!
Yes, you’ve been doing well with JDST Jason. (up about 11% today) High five!
I personally get a bit to nervous with both JDST and JNUG right now because we are whip-sawing back and forth in this narrowing channel and the direction reverses too quickly if you’re not watching it like a hawk.
Hopefully you did a Ninja vanish before the pop in metals today my friend.
should have said pop in metals miners (aka: GDXJ, and GDX)
Jason,
JDST is a balzy one to hold overnight right now..
I can’t believe the metals didn’t go up yet.
Big pop on gold should hit 1225.
I can’t stress this enough. BE PATIENT. We are about to move into the heart of the bankruptcy phase when the HUI breaks support at the 09 and 2014 bottom.
We are going to get a buying opportunity of truly mind boggling proprtions but you have to avoid the bankruptcy phase first.
Don’t forget the bigger the bear the bigger tha bull that follows. The best thing that could happen is for the HUI to completely collapse down to 100 or even 50. That would set up what will almost certainly be the greatest bull market in history. If the rubber band can get stretched to the lowest possible level then I have no doubt we will ultimately see the HUI at 1000, 2000 or even higher before the bubble phase is finished.
Sound advice Gary. I’ve been mostly on the sideline since early May (I sold in May and went away – Cliché but glad I did).
I’m thinking the bankruptcy phase is currently underway ( I saw more distressed mining news last week and this week), and we’ll see things devolve down into this month and maybe early August.
Right now I’m just doing more homework to build my shopping list of miners to buy on sale 🙂
Gary, very interesting take that may well prove factual. Personally, I think there are quite a few Allied Nevada’s lurking out there waiting for their turn at the insolvency table.
Przemyslaw Radomski, CFA who I don’t regularly follow appears to agree with you on continued weakness in the sector. His snippet below is in the public domain on Goldseek.com.
Summing up, the situation in the precious metals market remains bearish and based on this week’s disappointing performance of precious metals and very weak performance of mining stocks (and the breakdown below the critical support), it further deteriorated. It’s not extremely bearish just yet as we haven’t seen a confirmed breakdown in the HUI and XAU indices below their 2008 lows, so we don’t think that doubling the size of our profitable short position is justified just yet. We’re very close to this moment, though. It will take only 2 additional daily closes below the 2008 lows for the breakdowns to be confirmed and for the situation to become extremely bearish. On the other hand, we could see a reversal here or other signs of strength that could make us take profits off the table and enter long positions. It doesn’t seem likely at this time, but we are not ruling out such a scenario.
Vortex – Good thoughts on more insolvents still lurking & the post from Przemyslaw.
I never understand how it is possible for some of the board members manage to walk away with the land package or mine in a bankruptcy and the rest of us just get the shaft.
Agreed, thus the focus for good management teams and assets that won’t let it get to that point. CFS – did you see the video presentation on Mandalay on the European Gold Forum link up above? It’s 2 months old, but a pretty good overview of their history, current projects, and where they are headed the rest of 2015.
Just thought you’d dig it.
As I said up above, I was in Zurich in mid April and saw it first hand, then went UK, then Greece, now back in US, but go back to Europe in September, back to US in Oct., Europe again in Dec. I’d like to go to Vancouver at the end of this month. (Always like to hear Bob Friedland speak as he refuses usually to be webcast), but I have a medical situation that requires me to be in California.
Wow. I knew you were in Europe for a while, but apologize as I missed the line about you being in Zurich, and that is great that you got to see the show first hand.
CFS in your travels did you see any countries that really seemed to be doing well and vibrant, despite some of the challenges we hear about in Europe?
Yes, I’d like to be at that show in Vancouver as well, but we just traveled to Seattle & Portland in May, heading to beautiful mountains of Asheville, NC in July and are considering going back to Seattle & then Vancouver in September. We just can’t squeeze in another trip in.
Have a good one!
You staying at the Biltmore , Grove Park Inn?………Richmond Hill was a great stay until it burnt down…….
You should take the Blue Ridge Parkway over to BOONE, NC…you will enjoy it…..
No, we are camping at the Deerfields – beautiful spot. I’ve hung out at the Grove Park Inn many times – they have the most epic Gingerbread House competition at Christmas that I’ve ever seen anywhere 🙂 I like going there to sit by their fire place, get $25 glasses of wine, and watch the sunset in the mountains with Asheville nestled down in the valley along the river. Truly majestic.
I’ve been to Asheville about 77 times at last count and still have never been to the Biltmore. I’ve seen many pictures, and have a group of about 20-30 good friends in that area, but they’re all sick of going. I’ll probably bite the bullet and go soon though just to check that off my bucket list.
I am not familiar with Richmond Hill, but have been on many of the main sites there for decades, and may not have realized it at the time.
Richmond Hill….was on the west side of French Broad River, kind of NW. Great old BB.
10 course meal….piano…..wine , served as you expect……..Top of the chart of BB…, usually BB are hokey.
You are correct on the GingerBread houses……..at GP. Wildturkeys run the golf course.
Better take that trip on the Blue Ridge to Boone…….
If , you are going to see Biltmore go at Christmas, or Spring when in bloom.
good tips FFM. Yes, I’ve taken that trip on the Blue Ridge Pkw to Boone, and stayed in those mountains at one of the ski resorts. Beautiful. Never stayed in a B&B, so not much of a frame of reference. Thanks!
Shad,The most notable change. I see, throughout Europe, is the increasing numbers of immigrants everywhere. Muslim females stick out as very easy to notice because of wearing head scarves, but I use a lot of public transport, and in England, quite often on a bus you do not hear English spoken. In the area of my house in England, one hears Slavic languages spoken often; Polish, Latvian, Russian. In the midlands it is Pakistani, around London Middle Eastern languages. I believe it is slowly destroying the character of the country. Immigration is too much, too fast to absorb. This true throughout much of Europe, with overall Arab and Chinese the most common immigrants. The only countries less affected seem to be the more expensive ones: Switzerland and Luxembourg. (I have not been to Monaco in a couple of years). Greece appears to have more Turks than Arabs, but it is harder to tell unless you hear them speaking. Since I do not speak more than a few words in Greek and Arabic, I cannot engage much in conversation other than in English, French or German. A lot of Greeks speak german, but don’t like to.
Thanks for the response CFS. I have talked to people that traveled in Europe and talk to people that travel from Europe to the US and actually hear that the immigration issues are getting to extreme levels, and it is difficult to absorb all the people legally into the workforce, and changes some of the social dynamics in a meaningful way.
I’ve heard the same thing about the Slavic migration, middle Eastern, and I’ve also been told quite a few Norther Africans are fleeing to Europe over the last 5-7 years.
Shad. I forgot to mention, the country which seem s to understand that you CANNOT spend your way out of a debt problem is England. Not the UK, but England. Scotland and Wales are totally socialist dominated. So the English Prime Minister has to walk on a knife edge to be conservative but allow inflation to effectively slowly reduce social spending. He cuts back on the growth of defense spending and is repeatedly criticized by Obama as not keeping up his part of NATO.
The degeneration of the U.S. under Obama has been so fast that it is incredible it can be done so quickly by someone so determined to destroy the character of the country.
Agreed on both points – England’s awareness (they’ve already been down this road in the not too distant past) and Obama’s administration has made some decisions that about 60-70% of the country does not agree with, to pacify the other 30-40%.
Interesting times to be on the planet we call Earth.
Sadly, I believe the illegal immigrants have pushed the U.S. past the point of no return.
The numbers of illegals that vote democrat are just too many.
Good show guys. Gary has a very astute outlook on the general markets, and the potential for a 20% drop in the general markets this fall. I’ve been in that camp as well since the beginning of this year, and believe Sept/Oct will be a turbulent time.
One question I have for Gary is if he feels that PM stocks will get sold down as well during the general market crash, or if he feels that they may get a bid as money leaves the general markets and is moved over to the commodities markets?