In depth chat about the markets and gold
We chat with Gary about the Amazon profits that sent the stock higher then move in the markets. We take some time to develop a mid and longer term outlook for gold and the US markets how Gary seems them.
Click download link to listen on this device: Download Show
Yes, we certainly will Ulysses!
My thoughts (maybe hopes?) are that it will. I say this only because it seems very logical to me!
Murki’em lol
Al:
Thinking back to 1999 era, I remember watching the Nightly Business Report and it was unbelievable what some of those .com stocks were doing. Personally, I don’t think we’re comparable……..yet. JMO
Glad to hear, Gary is sticking with his basic forecast. I also look for Monday to decide what happens. 50-50 in my opinion.
Interesting read: http://www.businessinsider.com/now-is-the-time-to-get-greedy-in-gold-2015-7
I remember those days too, Silverdollar.
My, admittedly probably lucky, stock picking back in those days did wonders for us.
Well 5-7 days corresponds to July 28 expiration date at the COMEX … :).
Another trick by the FED ? They don’t know what to do to make us believe they’re gone raise rate !
Fed Accidentally Released Confidential Staff Forecasts, Blames “Glitch”
Fed’s model says first rate hike in Q3
“Glitch”, now that is funny!
From my blog this moring:
Here’s the thing. Armstrong has a weekly close at 1084 that triggers a bounce for two weeks and then a resumption down to the ICL. He’s followed closely by a big majority of investors, as he has convinced the world that his computer program really can predict the market (it does no such thing BTW).
But he’s gained elite guru status so the market will move on his calls. It’s happened many times in the past where a guru becomes so popular that he moves markets. David Tepper caused a mini sell off a year or so ago with a comment about not being heavily long stocks.
So the odds are at least decent that traders close gold above 1084 today and then the market follows through on Armstrong’s call for a bounce. Not because he predicted it, but because he caused it.
Excellent commentary this morning, Gary.
Personally, I lost some money when I bought JNUG @ $1130, expecting that would be the bottom
I’ve decided to try another JNUG trade by buying in with possibly 4 blocks. I bought the first block today @ $ 7.10, in case the $ 1080 area holds for gold.
If gold does go back to 1250, that would put JNUG at around $20-25. If gold drops to 1030-area, I’m guessing JNUG could end up as low as $5.00.
I think the risk reward tradeoff is acceptable here for a possible 200-300% return on investment.
Very odd feeling. I am actually fairly calm and confident … not unlike how I felt when I bought back into the PM stocks in late 2014.
As LPG says … GLTA trying to catch this bottom.
Good read Brian. Keep posting.
My JNUG Journey today:
On July 24, 2015 at 6:45 am,
Shad says:
Took a position out in JNUG, again @ $7.22, but I’ve very glad I sold out my position in after-hours last night, to skip the overseas madness and early morning declines.
We’ll see how it goes today, but since we have come down into the $1080-$1087 zone yesterday, dipped below it briefly in over seas trading, and are back in that zone again this morning, I believe we’ll get our bounce into next week (and possibly this afternoon may kick it off). I may be a little early to the party, but I’m ready to make a nice chunk on a short-term counter-trend rally in PMs in these bloodied up Jr Miners.
On July 24, 2015 at 2:28 pm,
Shad says:
Sold 75% of position in JNUG at $8.82 today for a splendid 22% profit. I held onto 25% of the position in case the bounce continues into next week.
Isn’t Armstrong planning on moving out of town?
Doesn’t Armstrong believe in deflation of all commodities?
Isn’t Armstrong suggesting a lower price to $800 gold?
I thought I read this info at FSN this week.
Wondering minds want to know…………thanks………………..THE CLAW
Gary-
Reminds you of the good ole days with Joe Granville 😉
Yah, Mr. Granville was quite the showman!
This would lead to scnario #2 that I descibe in the interview and another short daily cycle before the final low.
Jim Puplava of Financial Sense said the opposite about the retail investors. Not too long ago, I heard him say that the retail investors are still not in the market. And he cited this as one of the reasons why the stock market would keep going up. And when they finally did get into the market then the market would top.
Very true that the retail herd is not in the markets. That is why this is different than year 2000. I am not sure if they are coming back or not. Maybe if they lose enough in their bond portfolios, they may be convinced to dip back into stocks.
Everybody has an opinion PF!
Hard to quantify.
Al– don’t tell people to buy an amazon for profit.. thats insane
That is definitely not what I said.
Specifically, I said, “had I bought Amazon a couple of weeks ago I would be a happy seller today”!
For 2014 ABX had a recorded price earnings of 10.4 and Tahoe Resources registered 13.6.
Hope everyone one is well.
I apologize but I have to TOTALLY disagree with one thing Gary said about AMZN:
“margins are so razor thin that they are on the verge of being cash flow negative”.
IMHO, this is factually inaccurate and the financial statements clearly display this:
http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-newsArticle&ID=2070674
IF ANYTHING, AMZN Free Cash Flow generation, on a 12mths rolling basis, has been accelerating. The presentation slides clearly display this:
http://phx.corporate-ir.net/phoenix.zhtml?c=97664&p=irol-irhome
(click on Presentation slides when on the page).
I am not justifying the move up in AMZN shares today, nor its price level. What I am just saying is that saying margins are razor thin and on the verge of being cash flow negative is not only inaccurate, but in my view, the opposite of what is occurring.
AMZN spends a lot of money on infrastructure. If they decide to slow down on this or
even stop this, their FCF will pop massively.
As a full disclaimer, I don’t own shares of AMZN and don’t intend to buy or short them.
My 2 cts…
LPG
I’ve never owned AMZN but that’s good stuff LPG. No wonder you see a Great Panther (GPL) when you look in the mirror! 😮 🙂
http://www.greatpanther.com/files/doc_presentations/2015/May/GP_FS_2015-05-05-Eng-Web_v001_c3ev5n.pdf
good one. I still like GPL – Great Panther, when the Silver prices turn around.
I believe that Gary scenario is right on. The upcoming rally in metals will lead many to believe that the bottom is in, but at that point, a steep decline will quickly occur, which takes gold down to the $600 to 900 lower-level. Silver will go to the five dollar or dollar range, oil to $20, copper to $1.50, and the dollar is going to scream higher as well as long-term treasury bonds as they will be the only safe havens. I project the dollar to 120 and TLT to head back up to 140. This deflationary bust will put in the final bottom for metals of. then, we will finally see gold, silver and mining stocks bring in gains similar to what we saw tech stocks do in the 1990s. Hopefully, the premiums will not be too high on hard assets and they will be available for the taking. There are too many bullish gold bugs looking for a bargain here. I doubt we see that at the actual real bottom.
Good post, Velma. Actually I thought everyone who counted read this page and will only be looking for a 4-5 wk. bounce like you and me. Hope you are right along with the others who have expressed similar views.
Velma,your scenario is not supposed to happen until 2017.
It is not deflation but central banks control over the markets.
The ratio of US MONETARY BASE vs price of gold just hit a 100 year low:
http://www.macrotrends.net/1444/gold-to-monetary-base-ratio
Note how the price of gold was disconnected from the monetary printing of the reserve currency in 2012-the Fed balance sheet exploded while the POG collapsed:
http://www.macrotrends.net/1448/fed-balance-sheet-vs-gold-price
The federal reserve is keeping the worlds attention away from the obscene state of US Fed monetary printing with grossly blatant attacks on US constitutional money.
I think that is a bit on the dramatic side. But, who knows, there is no shortage of drama out there today!
Looking at the 7 year cicle on stock market, I really don’t believe that we will have another leg up. This look’s like THE BIG ONE!!!
Gary: your analysis about Gold earlier this week was spot on. Explosive rally potential out of the fabricated low from Sunday night – lo and behold what just happened. Saved my day. Cheers.
Big turnaround in gold but GDX is barely moving.
Was just thinking the same thing.
GDXJ up 3%. Newmont up almost 2%.
My GDXJ calls went flying but I sold most of them too early. That’s fine though, I’ll take almost 100% overnight anytime.
Nice one Matthew.
Best,
LPG
The ones I sold are now up another 100% 🙁 lol
At least I have some that expire next week that are up 3x from my purchase price yesterday.
Can’t win them all !
Nice one – still 🙂
Have a good WE & Best to you as always,
LPG
Thanks, best to you too!
Still a good day Matthew. I only made 22% on my JNUG position from this morning to this afternoon, so your gains sound much better. Yes, things did bounce at the end of the day as I was projecting they might. I only sold 75% of my position though, so if there is a continuation of the rally next week then my remaining JNUG position may do a little better on the percentage return. I’m still thrilled with a nice profit in 7 hours, because there is no telling how long I’d have to wait to make 22% on a savings account at the bank : – )
Well done on the profits guys !
But, Gary, you guaranteed us that this week was the bottom in the miners. Today might be the day. We won’t know until later.
I have to admit that I like the turn-around today in gold. The million dollar question is, “Will it continue into next week”?
Big Al,
I guess the million dollar question could instead be:
“Why do you care about next week if you buy gold for protection and if you believe in the secular bull market ?”
My 2 cts.
LPG
next week gold is gonna turn back down al to 1060.An ending diagonal is forming an atm we are in wave 4.Wave 5 will end by tuesday.Ending diagonals are followed by sharp pullbacks.
Guess who’s gonna get skinned ?
http://www.zerohedge.com/news/2015-07-24/has-never-happened-gold
GL to all investing/trading.
LPG
My gut tells me that we will get another big knock-down next week.
I am just wondering whether the big boys wish to scare everyone out of gold/silver this summer by crashing it down.
🙂
I think LPG would agree that it is the hedge funds that are going to get skinned.
Based on the price movement of silver, I feel we are at the bottom of the PM market. If they keep pushing the market down, two thing will happens – Silver is divorce to gold or they refuse physical silver delivery and settle in cash. Both are bad for manipulators.
If one person says the retail investor is in this market and then another person says they are not, I’m sorry but you can’t just say everyone is entitled to their opinion.
Statements like this are supposed to be made based on fact, not opinion.
The retail investor either is or is not in the conventional market, but it can’t be just an opinion.
Frankly I would never let a comment like that get by me
If so called experts are just going to spout opinions then pack it up now
Very volatile week, with a strong finish in the last 2 hrs.
I’m still in cash. If on Monday we continue higher, I might start to go long w/a starter position.
I don’t trust anything I see.
A lot of credit is due James (the lesser).
GDX didn’t turn this week. No one has any idea if we go higher or lower from here, but far this “bottom” is just a shelf, until we turn up, if we do.
Yea he writes long long LONG comments, but he’s an interesting guy, and I respect the fact that he’s after the truth.
Just wanted to note it.
… so far this bottom …
Dang Shad! The other day I said I expected JNUG to go to $7 +/- a few %. Sure enough today. Did I pull the trigger? No, I go to lunch, come back, and it’s at $9!! Argh. Maybe next week.
Yes, I actually thought about your comment when I was buying at $7.22. I sold 75% of that position back at $8.82 (net $1.60 gain per share from $7.22) for a 22% profit. I held onto 25% of the position in case the bounce continues into next week, but figured I should take some profits while the getting was good.
Thanks Bill in Tokyo
Al, I said’ an amazon’…meanining that it is near impossible to get that return w/out risk
in the market as Dan Oliver pointed out… you asked yr audience for ‘ones like that’…..didnt you…? We need clarity.
LPG should be thanked by all here for his advice and fact correction.
Most welcome Agatha.
Opinions can be discussed at will. But facts are facts. And facts are stubborn animals.
I wanted to post a link to AMZN presentation… but there was no way. I sent the file separately to Al/Cory for perusal though so they can see what I’m referring to.
But here are a few numbers from the presentation:
1) [Slide 3] FREE CASH FLOW ( Trailing 12mths basis, a.ka. “TTM”):
$4.37 bn in Q2 15 vs. $1.04 bn on a TTM basis back in Q2 14…
2) [Slide 5] RETURN ON INVESTMENT:
currently 17% vs. 6% in Q2 14 – inching up each quarter since
3) [Slide 20] OPERATING CASH FLOW (TTM):
$8.98bn in Q2 15 vs. $5.3bn in Q2 14 (up every quarter since Q2 14).
So I don’t mind someone’s OPINION that AMZN is an expensive stock on a valuation basis. This can be discussed…..
…..BUTTTTTT….
….to say, as Gary said (quote) “margins are so razor thin that they are on the verge of being cash flow negative” is both INACCURATE and also EXACTLY THE OPPOSITE OF WHAT HAS HAPPENED OVER THE PAST FEW QUARTERS.
I was discussing with Richard (Doc) privately last night that AMZN Net Income is IRRELEVANT. I will repeat: it’s I-R-R-E-L-E-V-A-N-T. The key to focus on is cash generated (wether Cash From Operations of Free Cash Flow). Period.
I’ll leave it there. Guess my message is clear. 🙂
Best to all, GL investing/trading in the coming weeks, and all have an enjoyable week-end.
LPG
PS:
To Gary: still love you though. Nothing personal 🙂
The conventional market is now at the beginning of a significant downturn—–the odds are very high for a move down for at least 4 months. If we don’t get the downturn I expect, you will not see a new high in this market before January of next year. The PMs are now due for a bounce but be very careful since the odds are this is not a significant move. We should after this bounce have the final move down for the PMs.
Agreed.
The commercials on the COT report didn’t show much change for silver but a net long position for gold of 12,000 contracts.
Greetings from beautiful Saratoga Springs. It was opening day at The Spa and it was glorious. After 150 years it never gets old.
The best horses, the best trainers, the best jockeys and the best competition.
After the races people don’t go home. They go out, to the best restaurants.
If you are in town shoot me a notice and we can talk horses and gold.
Did my eyes deceive me today? Did I actually see green?
Is the bottom in?
Heads or Tails
The group think is we get a bounce in gold followed by one more final leg down.
Then the big move.
Copper the public play at all times – Pittsburgh Phil
Patience and Guts!
It is looking that way James TL.
Looks like Sugar wants to revisit 10 dollars. But is that the final bottom? Well maybe not but sheesh, how cheap does it have to get to be on the buy list? I mean, if we cannot buy Sugar or producers at these dirt cheap prices then we probably don’t have any business speculating at all because this is one of those brain dead “just buy the bloody thing” plays.
Like Rice, like Wheat, like Corn and on and on. These commods are all bottoming or have bottomed at around the same time and well in advance of metals markets so we need to pay attention to what that really means.
Listener, you could be onto something there, “what it really means”.
Read Norcini on kitco today, boy does that guy love the goldbug gang.
Isn’t it interesting that we hardly hear a peep anymore from that crackpot crowd of extremist goldbugs that once over-ran and populated sites like the Korelin Report the same way that Ebola swept West Africa?
They were poisonous, violent, vitriolic and even bordered on manic in their misshapen adoration of all things gold…..but it is radio silence now. Almost every last one of them has gone dead. Their batteries ran down to zero or their broker accounts were wiped out.
Hallelujah!
I for one will not miss those ranting, raving freak-outs and their biblical gold-centric views of the world. The tree got shaken and all the nuts finally fell out. Broke, busted and angry…they will mostly not be around for the resumption of the trend.
So I don’t blame Dan for his harsh viewpoint. Some of those gold-nut guys were just pure nastiness and Dan took it on the chin from a lot of them for doing nothing more than point out the obvious on the charts.
The usual crowd of pumpers continues on though and I think they make him even madder than the pathetic mindless followers of the cult. Guys like the super-slick sweet-talking salesmen (like Mike Baloney) will just never shut up.
Not when they have product to sell and plenty of losers to sell it too. No shame at all. Even if they do know better. So yes, Dan is righteously angry and I think he was even hurt by the extreme negative comments coming from the lunatic crowd when he really believed he was doing his best to warn them a lot of danger was ahead for prices.
He was right of course. But the crazies would rather spit hot venom than hear the truth.
Too bad for them! And good riddance and goodbye.
Nobody hurt gold miners more than the gold-retards themselves who drove the public away from metals just because this commodity group was so vocal and so overpopulated by people on the very fringe of insanity.
They have been flushed. It is for the best.
Bird,
I guess what I find most amusing about the pre-downdraft and was the rabid intolerance to opposing views that just a few months ago when a few of us were going against the party line here and were only pointing out that there was a very good chance that what has in-fact happened in the sector, would.
And just for having that view, was tantamount to being barred from the site for having or forming a contrary opinion and subsequently posting it here.
And now, that prices have and are trending lower temporarily we just hear crickets chirping for the most part. The crickets are most amusing.
I fully expect when prices recover and regain some of the frothy overtones that are prevalent and expected in the PM markets, things will revert again and some will be back with thunder and lightening to dish out the old beat-down to anyone that deviates from the story-line on the PM markets going forward.
I hope to be able to have a conversation with reasonable folks going forward, but I’ll have to leave the hibernating rabid lunatic fringe element to you.
Take care, and by the way………..its time for the old Birdman to come on back.
V
HUM BUG………………………………………………………….THE CLAW
Good thoughts and funny.
The 100:1 paper gang flushed the PMs.Nobody is going to flush them as they run the show.
The pumpers were replaced with dumpers and they are just as crazy,nasty and pathetic.
Now that the bottom appears to be in it is good riddance and goodbye,indeed.
I wonder if Gary S. cycles are the same as Bob Loukas cycles?
That’s all we need – cycles that don’t agree or match up.
That is a good question Irwin.
About a week ago Bob Loukas posted his cycles and I asked him that very questions and how his cycles lined up with Gary’s or Charles Nenner research cycles.
@ Irwin et alia
Why don’t you, and other commenters here, approach Al & Cory to see if they could schedule a weekend round-table segment with both Loukas & Savage participating in the same segment or – even better yet – segmentS ?
It definitely would interest me and, I’m sure, most other kereport listeners/contributors, especially since both have based & refined their systems upon that developed by Walter Bressert ( from whose still-accessible website, BTW, one can download various PDF & and text files dealing with market cycles free of charge, no sign-up, no registration, et cet., » http://www.walterbressert.com ].
Just a thought 😉
thanks for posting the link to Walter Bressert’s site LFP.
GDXJ priced in GDX continues to hint at good times coming to the sector. I added to several long term positions last week and feel very good about it.
http://stockcharts.com/h-sc/ui?s=GDXJ%3AGDX&p=D&yr=0&mn=11&dy=0&id=p20695279079&a=414643240
Silver formed a bull hammer after it bounced from (Schiff and modified Schiff) fork support.
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=D&yr=1&mn=9&dy=0&id=p74656451048&a=371157668
Did you see the bearish price obj for silver?
-holly crappy doodles
http://stockcharts.com/freecharts/gallery.html?%24SILVER
I want me some of that $4 silver;
having passed up the chance to buy it at $5
Well how about that;
during the time it took me to post that and check the link,
the p.o. went from $4 to $3
-maybe by Monday it will be free!
I got $3 based on the “breakout” PO:
http://stockcharts.com/freecharts/pnf.php?c=%24SILVER,PWTADANRBO%5BPA%5D%5BD%5D%5BF1!3!!!2!20]
And $17 based on the “reversal” PO:
http://stockcharts.com/freecharts/pnf.php?c=%24SILVER,PWTADANRRO%5BPA%5D%5BD%5D%5BF1!3!!!2!20]
Go figure. Oh yeah, and point. 😮
I’ve never really understood how to read those charts Matthew. What do the numbers inbedded in the Xs and Os mean?
On a P&F chart, price movements are represented with rising X-Columns and falling O-Columns.
http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:pnf_charts:pnf_basics
Yes, I knew X were rising, and O was falling, but I didn’t understand the letters and numbers imbedded in the columns. I got a good read out of that stockcharts school though, and figured out, since those charts are not linear in time (like a line or bar chart) that those letters and numbers represented different weeks or months and depicted time movement. Very interesting.
Here’s a weekly chart that I haven’t altered in months. Silver’s bounce makes sense here, too:
http://stockcharts.com/h-sc/ui?s=$SILVER&p=W&yr=5&mn=3&dy=0&id=p67079633085&a=375430045&listNum=1
It makes sense here as well:
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=5&mn=3&dy=0&id=p37141100613&a=370837400
After coming to within just 1.5% of the December low, we have the possibility of a big double bottom in play.
GDXJ is at resistance:
http://stockcharts.com/h-sc/ui?s=GDXJ&p=D&yr=1&mn=1&dy=22&id=p74612248989&a=417571153
Good chart Matthew. This is why I felt we’d get our bounce on Friday going into this next week in Gold, at just wee bit below 1080.
More downside for the Dow:
http://stockcharts.com/h-sc/ui?s=%24INDU&p=D&yr=1&mn=2&dy=0&id=p71035619471
More upside for gold is probable:
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=2&dy=0&id=p39118684497
Gold reversed at the 144 month EMA:
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=M&yr=15&mn=4&dy=5&id=p92355809195
For those who can view a monthly chart, here’s 35 years of the Canadian dollar. I think it is very close to a major low.
http://stockcharts.com/h-sc/ui?s=%24CAD&p=M&st=1980-07-26&en=today&id=p18489425778&a=417590681
Commodities – esp oil and copper will have to bottom if CAD is to stop at 0.75
CAD/MXN is what’s killing Cdn exports right now.
Bank of Canada gov Poloz is scratching his head, wondering how to get CAD lower so as to compete with Mex.
I think oil is very near a low too. The daily chart is oversold and the weekly and monthly were very oversold recently. The 377 (Fibonacci number) month EMA offered enough support in March and I think it will again (currently near $43).
Cory feels that we are still ten to fifteen points away from that low. We certainly will see.
I think Doc thinks so too.
Actually, a week back Doc said he thought the Canadian dollar would drop to .61 although personally I am pretty skeptical. That does not make sense where gold, silver, crude and platinum are concerned unless we also conclude they are going to drop in equal magnitude.
If I am not mistaken Cory agrees with Doc. To me .61 seems a bit much. But, I have been wrong at least once before in my lifetime!
Makes two of us Al. I will only add that if Doc is correct then precious metals are in for a very rough ride. We ain’t seen nuthin yet.
Matthew…………….thanks for all the chart………………………….j the claw
So do you think that Claude will bounce off the bottom of that Schiff Fork?
Oops, the one at 9:04 should’ve been this one:
http://stockcharts.com/h-sc/ui?s=CLGRF&p=W&yr=2&mn=11&dy=0&id=p18018390770&a=396899698
I’m not so sure that I fully agree with Gary’s take on the current tech bubble.
If you look at some long term charts of various biotech and tech companies or ETFs, the leaders already seem to be in a bubble comparable to 1999/2000.
http://finance.yahoo.com/echarts?s=BBH+Interactive#{“range”:”max”,”allowChartStacking”:true}
For BBH, substitute in the link:
AAPL
AMZN
GOOG
AMGN
The previous leaders of the 1990s tech bubble seem to have lagged a lot:
YHOO
MSFT
INTC
CSCO
JDSU (!)
These long term charts illustrating price action from the 1990s until now make fascinating viewing!
The current bubble looks as extreme as 1999/2000 on the strength of these.
JDSU…………WHAT A DOG…………$215 Down to $15(or less)…………..This one sucked a lot of people in……….
I learned a good lesson on that one…………………
GOOD lesson on do your own ….DD
For the charts above, it has not linked properly.
You will probably need to go to
http://finance.yahoo.com/echarts?s=BBH+Interactive and select Max as the period at the top of the chart.
On Gary’s comments on Amazon:
Maybe Amazon is being run like a non-profit. In that case, perhaps you need to look at their sales or market share. instead.
Furthermore, in this period of zero interest rates, it’s all about capital gains and people don’t seem to care about earnings and dividends. There are plenty of stocks that do pay dividends but for some reason Amazon has been more attractive.
If gold follows the Japanese Yen’s move last year, it could go down near to 800 and reach Rick’s $817 target any minute. If the gold:yen correlation has broken, then maybe it can stay over $1000.
Gold Miners Bullish Percent Index (BPGDM) has finally dropped to zero.
http://stockcharts.com/c-sc/sc?s=$BPGDM&p=W&yr=3&mn=0&dy=0&id=p89722347313
In the past whenever this has happened, the index has moved sideways for a couple of months before shooting up. Will it happen again? We will find out.