Back from Labor Day and the conventional markets are moving higher
Gary starts off today with comments on the conventional markets and gold. He continues to think we need to see higher prices for gold as there are still too many people in the bear camp.
We hope everyone had a great Labor Day long weekend!
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At the open? Hell no….most of the action came in the premarket while you were still sleeping.
The market trades before NY opening hours. It trades after the close too. You knew that right?
Great point, Listener!
I am not sure what you mean?
Sorry…posted above your comment in error. Just look up for my response.
Nah, I knew what you meant – was trying to figure out what silverbug was saying.
Is he saying that the markets open with most of the stocks changed and then very little change is happening after the opening?
I wish I knew. Most of you guys leave me confused! 🙂
Sentiment on commodities is approaching rock bottom levels. Major bottom is near.
Short Side of Long article
https://shortsideoflong.com/2015/09/commodities-close-to-a-major-bottom/
sentiment on commodities is approaching a tradable bottom, global economic growth is needed to put in the bottom and where, how is that going to happen, more QE that hasn’t popped global GDP worth mentioning after Trillions of liquidity injections.
Deflation
Your friend Martin seem to think that if stocks crash that commodities will bottom with them. After that we get a bull market in both just like 1932 where money rushes into private assets as bonds implode. That’s if I understand what he is saying. Maybe he will be right.
his computer data is my friend, not Marty, lol
And Judas denied Jesus too.
who’s judass?
Kiss on the cheek and I will tell you.
A Listener, that was hilarious!
Read the president of San Francisco Fed’s comments on this subject in this mornings’ WSJ.
Jusass?
I’m leaning towards another short position in the miners as I’m watching Yen it appears to be rolling over as the BOJ was protecting any strength above 84.30 area if it closes below 82 gold should be suggesting another sub $1100 trend taking the mining indexs to new lows as they all are just above key previous support zones.
Not a clean set up in the pm’s sector from what I see, certainly no clear buy signals!
As evidenced on the front page of the WSJ just today!
Biggest pop in Copper today I’ve seen in a long time, dragging silver along to a lesser degree.
Gold is trading off Yen not $ yen has weakened 1/2 cent holding back gold.
Going to be very interesting if S&P heads higher into FOMC date especially if no rate hike takes place as S&P would pop further off another rate hike delay.
So much for oil ripping higher as Saudi King backs Iran deal this weekend, what happened to you goldbug nuts suggesting the King was going to tell Obama stuff the $ we will sell oil to China in Yuan….lol
A Weekly close above $1242ish would suggest the gold bull has returned as the upper resistance zone gets lower and lower with every lower high point before gold rolls over these past few years, the $1307, $1392, $1434 and $1487 would all need to be left behind to confirm the bull has in fact returned on the weekly chart, the biggest resistance zone will be where gold truly broke down the $1525-50 area, will that area ever be tested again?
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=3&mn=0&dy=0&id=p26464839390&listNum=1&a=423423791
So what’s your call jj? I am in for a gold drop and damn the torpedoes!
I’m leaning towards another short position in the miners as I’m watching Yen it appears to be rolling over as the BOJ was protecting any strength above 84.30 area if it closes below 82 gold should be suggesting another sub $1100 trend taking the mining indexs to new lows as they all are just above key previous support zones.
Not a clean set up in the pm’s sector from what I see, certainly no clear buy signals!
Stocks up….gold down…bond yields rising.
Hey jj…if Martin is right then we may not be at the commodity bottom at all. We shall know soon enough if we break through the lower bound.
I’m the first one to agree the levels we are at with some of these indexs are the 2009 lows or even 2001 lows, but today is sooooooo different than that of the 2009 TARP lows and 2001 China growth lows
That is exactly what worries me.
I think its the #1 issue those that are aware off these key levels are focused on, QE1-2-3-? has done what for REAL global growth be it from the Feds, ECB, BOJ so what is going to created the bottom in the commodity sectors, real growth from where based on more QE or street level real growth. Maybe much lower levels won’t take place instead how about years of $40 oil, no real growth just stagflation
With time, rather than demand, supply destruction may put in the bottom.
Copper seems to have gone up in line with whatever China did overnight. What did they do?
Ah, something to do with Glencore closing some mines.
Copper is dragging silver along? lol
yes Matthew the two have been in sinc for many years, do try and keep up
http://stockcharts.com/h-sc/ui?s=%24COPPER&p=D&yr=6&mn=9&dy=0&id=p79836392336&listNum=1&a=423429633
Lol, being in sync does is not proof that one drags the other. That’s not very scientific of you.
OMG
I’ll see your OMG and raise you a WTF.
Oh yeah, lol. I almost forgot.
Lol…..
Just so you know, the silver price is consistently MUCH more correlated to gold than copper.
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=3&mn=0&dy=0&id=p75030355704
Correlation measure is at the bottom of each chart.
Sorry is this the chart expert Matthew or some wanker? Silver topped out long before gold did during the bull years just as its peers did, Copper, Oil, CRB anyone holding silver after April 2011 based on the MUCH consistency of the gold correlation would have been road kill!
That does not change the facts, JJ. You don’t understand the correlation measure so here are some pictures.
First, here’s silver and copper (black line):
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=3&mn=0&dy=0&id=p03197725272
And here’s silver and gold (black line):
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=3&mn=0&dy=0&id=p90709347456
Gold “drags silver along” 90% of the time, not copper. Get it?
FACT, Silver topped out long before gold did during the bull years just as its peers did, Copper, Oil, CRB anyone holding silver after April 2011 based on the MUCH consistency of the gold correlation (that you suggest is far more important) would have been road kill! FACT
“FACT” LOL
Silver is STILL far more correlated to gold. FACT.
I’ll really dumb it down for your Matt, FACT anyone well long silver into its April 2011 highs that used gold as an indicator for silvers trend would have been using the wrong correlation, if they used Copper, CRB index, Oil, GNX, Coffee they would have seen the whole inflationary global growth trade was rolling over and would have taken profits, that’s what I did, FACT
You need copper to tell you to take profits? A 90 RSI on the weekly chart won’t do it for you? Even as silver made its April ’11 high, it was more correlated to gold. Gold made a high at the same time even though its ultimate high came later.
There are plenty of instances in which silver moves in the opposite direction of copper but probably none in which it went up significantly while gold fell.
Copper does not do the dragging regardless of appearances to the contrary.
To be clear, your comment that “copper is dragging silver” is the issue here, not whether or not copper’s action is a useful leading indicator.
don’t ever use rsi on any of my trading charts as it can run overbought and oversold forever, I was 100% certain that silver was going to print $50 and at least make a new high as gold did from the 80’s but when the inflationary indicators that I mentioned all topped out it was time to sell the second half of my position after selling the first 1/2 with 100% gains. inflation was my key indicator so I watched all the inflation sensitive charts and all were rolling over, didn’t get a buy signal on silver till $34 should have sold ALL my physical then, oh well!
At least logic says that it should be!
Wow Gary, bullish on gold. You have diverged form Doc in a big way on gold and that seems to be on the strength of the past couple of years to be going out on a limb! Then there are the guys at Gold Ta Paradise who are looking for the capitulation move in gold and gold stocks to happen any time soon. Here is one of their latest missives:
I am interested in their bear market model as it applies to the current precious metals scene.
Mid Point Bearish Falling Wedge….an Historic Example
http://goldtadise.com/?p=349782
From 1907 no less!
There are also some fascinating charts linked from this page, especially with regard to the Phase 3 stage of a bear market – the “annihilation phase” as they call it:
silverbug dave, I’m sure its possible who saw a 100 HUI off 600+ for me the GDX has given us its levels for the breakdown with a close below 360 on the daily chart and a close below the 350 on the weekly will open the flood gates, yikes!
sorry GDM index not gdx
Technicals are certainly interesting!
A Listener, I think you have Armstrong a** backwards, he see’s sub $1000 gold, $20 oil as the US$ trades much higher along with higher rates and higher S&P before the crushing strong $ brings down the global economies as the emerging markets have huge US$ loan exposure.
Eventually the strong $ will be the pin that pops the debt bubble, from 1981-1986 the $ rose 60+ cents while the S&P rose 40% again during 2009 lows the $ rose from 89-100 as the S&P rose 220%….the key factor behind these moves was interest rates falling!! that’s not the case today
Well its not my fault. NOBODY can decipher what he writes. Its not like its just me.
agree the guy is a cryptic writer at best, his audios are far simpler to follow/grasp for me anyway
Anyone know what’s up with BABA? It went down all of the sudden from being up 4.5% to negative on high volume. China shares as a whole aren’t down either from what I can tell.
It looks like BABA leads SPY often by a day so it could be telling us that SPY is getting ready to fall too. Its low was 58 on 8/24 and SPY made its low the next day.
You can see that BABA led SPY at one low after another for the last year:
http://stockcharts.com/h-sc/ui?s=BABA&p=D&yr=1&mn=1&dy=0&id=p25942499461
Thanks for that insight, Matthew!
The smart money is selling the rallies I suspect.
Just read it was mostly short covering as traders got back to work from the holiday.
Where did you see that A Listener?
Can’t recall Al. I thought it was Market Watch but when I looked the article is not there. Sorry about that. I read too much today. It makes perfect sense though that traders would be covering short positions if the belief was we are heading higher. I have serious doubts today though for a variety of reasons.
I did just see a commentary from Rick Ackerman a few minutes ago though. He essentially confirms what I wrote earlier where he writes about todays short squeeze….
—————————–
“If the Dow can get short-squeezed 400 points on any given day, there’s no reason why it can’t have two of those days back-to-back. Let me repeat this: It’s no time to be a hero. If you have a strong opinion about where the broad averages will be trading in a week, do yourself a favor and move to the sidelines. The purpose of rallies like the one we saw yesterday is not merely to cause bears pain, but to turn the very best traders — i.e., those with brains, guts and conviction who are usually right — into chop suey. I’ve seen them carried of the trading floor on gurneys. Let short sellers beware!” — Rick Ackerman
If stocks do get run up tomorrow then the bear flag pattern will likely get broken and thus leave most wondering again just exactly what is coming next. Whatever is coming I am not getting in its way since the crystal ball is not working for me right now.
Asian markets continuing to go crazy – looks like this will roll over into European and US markets soaring on Wednesday.
From RT
China intends to oust dollar from oil trade
Published time: 8 Sep, 2015 13:52
Edited time: 8 Sep, 2015 14:22
Get short URL
© Carlos Garcia Rawlins
© Carlos Garcia Rawlins / Reuters
1.9K138
China is planning to launch its own oil benchmark in October, similar to Brent and WTI, striving for a more important role in establishing crude prices. Unlike the Western benchmarks, the Chinese contracts will be nominated in the yuan, not the US dollar.
Shanghai International Energy Exchange sent a draft futures contract to market players in August, Reuters reported quoting sources.
Oil futures will be the first Chinese contract to permit direct participation of foreign investors. However, this is not the first step for greater oil market openness in China. In July, Beijing allowed private companies to import crude. Previously importing was only done by state-run majors such as Sinopec, China National Petroleum Corporation and China National Offshore Oil Corporation, the Xinhua news agency reported.
A Shanghai-based contract will compete in the crude futures market, which is worth of trillions of dollars and is dominated by two contracts, London’s Brent, seen as the global benchmark, and WTI, the key U.S. price.
North Sea, Brent oil was first developed in the 1970s. The ICE Brent futures contract was developed in 1988. With an approximate output of only 1 million barrels per day, this blend is considered a benchmark and its contracts are now used to set prices for roughly 2/3 of the world’s oil.
China is one of the world’s largest oil buyers. Nearly 60 percent of its oil consumption comes from imports.
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Thank you Agatha for this post.
Nice find, Agatha!
yeah, isn’t it extraordinary how our media doesn’t cover-
400 points up in one day – well, that escalated quickly.
Anyone see it coming?
I would be careful here Gary. We have bear flags forming on all the major indices as volumes are falling since the correction began and the Bullish Percent Index on the Dow has turned down on the lesser charts. To me it is looking increasingly like a continuation of the bear trend in stock markets may unfold very shortly. I was anticipating a strong rally today and we did get that but if there is not a good follow through in the next day or two I would be on high alert for a negative reversal early next week.
Oh the world isnt changing….no….oh no….right..:)
Almost all of the price changes in the conventional markets seem to be at the open right now. Is this not a significant event? It doesn’t seem quite normal to me.