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Is this bounce going to continue for the markets

January 22, 2016

With next week being the last week of a dismal January it will be telling to see where the markets moves and if oil will continue this move up.

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Discussion
78 Comments
    Jan 22, 2016 22:06 PM

    sounds to me like the conclusive forecast of the end of the world on Tuesday market open are suddenly in doubt three days later. Suspect we do get a dip close to 1850 soon which should be bought when the pornbears resurface as this pop up is not over simply because there are plenty of shorts who need to take their profits

      Jan 22, 2016 22:14 PM

      NO, IT’S NOT THE END OF THE WORLD…………..it’s just Judgement Day for a lot of scheme’s and lies!

        Jan 22, 2016 22:17 PM

        It’s a Margin Call.

          Jan 22, 2016 22:19 PM

          Just wait until next week…………you ain’t seen nothing yet!

            Jan 22, 2016 22:28 PM

            OH, and wait until next month!
            The Pain Game explodes!!!!!!!!!!!!!!!!!!!

            Jan 22, 2016 22:33 PM

            I gather you’re bearish. We’ll see Mark but I don’t think quite yet.

      Jan 22, 2016 22:36 PM

      LOL………LOL………..LOL!!!!!!!!!

        Jan 22, 2016 22:37 PM

        You better believe it……………YOU WILL SEE!

          Jan 22, 2016 22:39 PM

          How dumb and greedy can you people be!

          Don’t you know what is happening right now?

            Jan 22, 2016 22:40 PM

            Still waiting on the official word, huh!

    Jan 22, 2016 22:08 PM

    This morning I got so scared of dragonfly doji forming on weekly SPY chart, I got the heck of Dodge. I covered my short position and went back to cash. Wish I listened to Doc. He was so right on in his Tuesday interview. He is amazing!

      Jan 22, 2016 22:18 PM

      doc is the only one worth listening to, Unlike some who left the site, who chose to write their script as to market direction and then wait for the market to conform until such time as they have to write a ridiculous new script forever hoping that eventually they are correct

        Jan 22, 2016 22:21 PM

        Rick A is pretty darn good a calling turns and nailing support and resistance targets.

        Chris T. is pretty good on analyzing the macro picture and picking winning stocks.

          Jan 22, 2016 22:34 PM

          I should add that Big Al, Cory, LPG, and all the weekend show guests do a great job.

            bb
            Jan 22, 2016 22:57 PM

            Absolutely Excel, 100% agree on chris and rick, also, Rick is the only person Ive seen making cash shorting.
            Unless I missed someone else.

            Not to say Doc isnt great of course.

            Jan 22, 2016 22:29 PM

            I guess I don’t understand that comment. Out of the main commentators on the KER show, Doc has shorted the markets playing using VIXY, and shorted China using FXP, and Big Al shorted the general markets very publicly earlier this year. Avi Gilburt has shorted GLD and the Miners repeatedly, and Michael Belkin has shorted the general markets and specific stocks repeatedly. There are others, but you are correct that there are more value investors that wait for pullbacks and then go long, than those that short overall.

            On the KER blog there are a number of bloggers that have that have shorted Oil, the metals, the miners, and the markets for short-term trades. Short positions are usually more swift, and for traders may be short duration periods. I can think of many times where people were using SPXS or TZA to short the markets, or FXP to short China, RUSS to short Russia, DWTI to short Oil was very popular for a while, or TBT to short treasuries, or the most popular on this blog or DUST or JDST to short the miners.

        Jan 22, 2016 22:25 PM

        No need to hold a bad prediction against anybody. We all have to watch our OWN charts to control the trading/investing risk. Most every guest on this program has something interesting to say. But I do note that Doc has some pretty good batting average… lol

    Jan 22, 2016 22:17 PM

    There are actually a few really good videos & charts to consider embedded on Morris Hubbart’s update from today on 321Gold. Enjoy!

    http://www.321gold.com/editorials/sfs/hubbartt012216.html

      Jan 22, 2016 22:18 PM

      Doc – I think you’ll like this video in particular:

      http://www.superforcesignals.com/video/2016jan21gold/2016jan21gold.html

        Jan 22, 2016 22:39 PM

        Excelsior, thank you very much—I really enjoyed this video. The fellow adds some technicals and a lot of it meshes with my current thought process. He talks about the descending bullish wedge on the monthly gold chart which I’ve watched for months.

          Jan 22, 2016 22:49 PM

          Exactly. That makes Clive Maund, Jordan Roy-Byrne, Gary Wagner, and Morris Hubbart that are all analyzing the monthly chart on gold looking for when it will break out of the descending wedge. They all agree it will be to the upside (which does make me nervous where everyone agrees).

          Regardless, I was wondering if this cup & handle or saucer pattern may give Gold enough oomph to at least make it up to the trend-line in the $1142 area or the Sept 25th prior peak at $1146. Morris seems to think it could get going even more up to $1180, but I think it makes more sense for Gold to go up to the trend line and get smacked back down into the spring as you’ve noted.

          On a side note: The camtasia software he uses is what I was mentioning you may be able to use to post links to video annotation of your charts here on the KER, when you guys had worked on that in the summer. You could pre-record the sessions and just post the slideshow of your charts as a link, without having to do it “live”.

          Gary Wagner also has some way of displaying and annotating his charts as he talks so you could reach out to him and see what program he uses. Here’s a recent video from him:

          http://thegoldforecast.com/video/oil-scorching-everything-earth

      Jan 22, 2016 22:33 PM

      I like that cup and handle on the gold chart……….needs to break the 1110…….1112, and it off to the races……………CCF….and of course…jmho

        Jan 22, 2016 22:37 PM

        Yes sir. Remember $1111….Gold was having a hard time punching through on the first few attempts, but this is normal where there is heavy resistance. When it punches through the rim of the cup or the saucer next time, the rally should get some legs.

          Jan 22, 2016 22:41 PM

          IBJ….use to say……when watching the cup and handle, it needs to be 1/8 above the handle to confirm(or at least something like that). I was thinking of saying that 1111, but, I thought 1112….for security …. 🙂

            Jan 22, 2016 22:51 PM

            Very prudent. We’ll go with a break above $1112 then…

    Jan 22, 2016 22:30 PM

    I went into gdx thinking gold might the last thing left to rally but sold out on a small bounce as it looks weak. The market is just following oil and when that turns down near 34 we will be in trouble again. I am trying to buy the vix but is not down enough.

      Jan 22, 2016 22:33 PM

      Yep. I’m watching the VIX as well for an entry point.

      For thoughts on GDX – Morris had some good thoughts:

      http://www.superforcesignals.com/video/2016jan21etfs/2016jan21etfs.html

        Jan 22, 2016 22:37 PM

        ditto……..on Morris had /has some good thoughts………..appreciate……the booty

          Jan 23, 2016 23:51 AM

          Ha! That should be your new moniker……The Booty.

            Jan 23, 2016 23:31 AM

            the list of monikers is getting hard to remember……… 🙂 THE BOOTY

            Jan 23, 2016 23:29 PM

            Agreed The Long…………Claw.

      Tom
      Jan 22, 2016 22:39 PM

      Miners have not even began the bankruptcy phase yet. When half of them disappear then that will be the time to start nibbling. Then after that period, there will be years of consolidation. Then maybe in 20+ years the miners will start to move up into a bull market. Even then I remain doubtful. It is amazing how much money Gary Savage lost and lost for his followers. I’m surprised he still has a blog.

      The gist of my rant is this: stay away from GDX and GDXJ. Much greener pastures elsewhere, especially in cash. This market cannot digest an 80% down move in oil without heading south in a significant way. Look at Union Pacific missing earnings due to slowdown in that sector, look at china, look at American Express missing, look at the casino stocks like Wynn getting killed, and finally stocks like BHP due to slowing iron ore purchases and declining prices. The Fed wants to raise rates?? I guess I’m missing something.
      This won’t be 2008 but its doing to get worse.

        Jan 22, 2016 22:46 PM

        I would have to agree with some of your thoughts Tom………

        Jan 22, 2016 22:10 PM

        Is the 700 zombie companies in TSXV same as bankruptcy?

        Jan 22, 2016 22:34 PM

        Re: ” Then maybe in 20+ years the miners will start to move up into a bull market. Even then I remain doubtful.”

        That’s ridiculous but I appreciate the comic relief.

    Jan 22, 2016 22:35 PM

    The rally should be over by the end of next week or earlier unless oil is able to break the down trend by reaching 38.

      Tom
      Jan 22, 2016 22:42 PM

      oil is going to the teens. Agree on maybe a week or two of rally first before next leg down.

    Jan 22, 2016 22:41 PM

    Anyone catch the oil rally? If it ain’t a rally on the one year chart I ain’t buying. I don’t trust it. Gold same.

      Jan 22, 2016 22:48 PM

      It is worth buying for a bounce. XOP went up 22% from the crash day.

      Jan 22, 2016 22:54 PM

      Wrote ya yesterday man. I only caught part of it in UWTI then took my chips off the table (too soon once again). But I didn’t trust the oil rally either and don’t think it will be long-lived.

        Jan 22, 2016 22:06 PM

        UYM (basic materials) hit a multi year low at $25 but I cancelled my order for that during the crash. It is now 27.79 but usually trades near 35 to 50.

      cs
      Jan 22, 2016 22:47 PM

      Made a couple grand and hoping for more. Playing the small caps
      SGY , SN
      But these at the bottom

        Jan 23, 2016 23:29 AM

        cs – Thanks for the heads up on Stoney Energy & Sanchez Energy Corp.

        Much appreciated.

          Jan 23, 2016 23:30 AM

          make that Stone Energy corp. Sorry. 🙂

    Tom
    Jan 22, 2016 22:49 PM

    True fear is not illustrated in gold and precious metals buying. True fear is when people buy nothing but guns, ammo, bunkers, and supplies! I laugh when I hear people say “Gold is a fear trade.” Has no meaning at all. Cash is more of a fear trade than Gold. You are scared so you buy gold? Ridiculous. Gold is an industrious metal and a store of value with the potential to be pegged with currency.

    Doc, I’ve always liked your views which is why I comment under yours. I usually don’t comment under the other interviews. I’m just sharing my opinions.

    Thanks

      Jan 22, 2016 22:57 PM

      I mentioned Wednesday that Gold had changed character a bit and was receiving some safe haven bid when the markets got riled. When comparing charts of long term treasuries and the Yen, there was a definite correlation with Gold over the last 6 months during periods of time when the markets took it on the chin (Aug, late Sept, and from Dec to present).

      Some commentators don’t think Gold was getting a safe haven bid. Well, apparently Captial Economics just noted that they did see Gold starting to attract the safe haven bid again.
      _________________________________________________________________________
      Revival of Safe-Haven Demand Lifting Gold – Capital Economics
      By Daniela Cambone – Thursday January 21, 2016

      “While the turmoil in global equity markets is weighing on the industrial metals this month, gold is benefiting from a revival of safe- haven demand said research firm, Capital Economics on Thursday.”

      “Gold and silver are benefiting from safe- haven demand on the back of the fall in global equity markets, exacerbated by the recent oil price declines and escalating tensions in the Middle East said Julian Jessop, commodity economist for the U.K-based firm.”

      On a bullish note for gold, there are three key positives for the metal, Jessop said. “A revival of safe-haven demand is lifting gold prices; pick up in inflation in the world’s advanced economies and then the third is underlying strong demand from emerging economies and central banks,” he explained.

      http://www.kitco.com/news/2016-01-21/Revival-of-Safe-Haven-Demand-Lifting-Gold-Capital-Economics.html

      Jan 22, 2016 22:07 PM

      Tom, appreciate your views since they’re thoughtful and not reflective of others’ opinions. Your comment about cash being a fear based trade (IMO) is right on and currently it appears to be the recipient of the fear based trade.

        Jan 22, 2016 22:02 PM

        There is no doubt that cash is the recipient of a great deal of fear-based trade. That is why investors or firms “go to a cash position” after all.

        “True fear is not illustrated in gold and precious metals buying….I laugh when I hear people say “Gold is a fear trade.” Has no meaning at all…. You are scared so you buy gold? Ridiculous. ”

        The point of the Charts that were posted up above isn’t just throwing up an opinion, it is factual record on what the markets have been doing when fear and volatility entered the marketplace.

        The S&P got clobbered in August, late Sept, and from the end of December to the middle of this week. When the S&P roiled and plunged, and when volatility rose, the charts clearly show where Long-term treasuries, the Yen, and Gold in US dollars rose in sympathy as the beneficiaries of some of the fear trade. Not an opinion.

        “You are scared so you buy gold? Ridiculous. ”

        Yes. Apparently some investors do. They also by the 30 year and Yen, defensive stocks, and as already mentioned, many absolutely go to cash. None of those strategies seem “Ridiculous”.

        “True fear is when people buy nothing but guns, ammo, bunkers, and supplies!”

        So, the next time the S&P and Dow and Russell 2000 tank down real hard, in an oil plunge environment, where commodities are in the gutter, and while the Fed is starting to raise rates (in negative real rates) and during a deflationary rout……. Then the best thing one should do with this real fear is buy guns, ammo a bunker, and supplies?

        How will buying guns, ammo, a bunker, and supplies help me protect my investment account or trading account? What make or models of guns, ammo and bunkers should one buy during a big stock market sell off to hedge against these losses?

        While I personally believe being prepared with food, energy, supplies, and protection is important, these items mentioned have nothing to do with hedging your investment portfolio against downturns in the general markets, central bank meddling, or a financial mess in the energy and commodities space spilling over into currency issues for emerging market economiess or commodity countries, job losses, and a contagion of the financial sector.

        Guns, ammo, a bunker and supplies are for a whole different level of physical reality and preparation. Investors going to Cash, Long-Term treasuries, Gold, Japanese Yen (or the Swiss Franc in the past), dividend paying stocks, and a rotation into defensive sectors is how they react when there is fear and turbulence in the markets historically. So Guns, ammo, & bunkers aren’t relevant financial tools for hedging financial losses in equity market corrections or potentially a new Bear market. These items are apples and oranges, and not on the same ball field.

        The data shows that in the last few years Cash and Long-Term Treasuries, have been the 2 primary vehicles investors jumped into when there was panic, and there was some spillover into the Yen and defensive equities…. in the US markets.

        Gold has NOT been getting the fear or safety bid the last few years with US investors, but there are plenty of emerging markets in Asia and South America where gold is absolutely getting the “safety” or “fear” bid as things unravel finanically. This is something we can all agree on, and the charts verify this.

        What seems noteworthy is that since the August steep sell-off in the US markets, that there is a returning fear and Gold has started to get a bid. We’re 7 years in to a non-stop gravy train to the sky bullish run in the general indexes, but over the last year or so there is consolidation, no longer new highs every few days, and the rounded top and lack of conviction is sinking in. Since August, when the markets get hit hard due to Oil worries or China Worries or Fed worries, or whatever…Gold is finally getting a big.

        Today the general markets in the US and world were up meaningfully overall, and thus Volatility, Long-Term Treasuries, Gold, and the Yen closed down.

        Obviously the UK investment firm Capital Economics & Martin Mureenbeld, Chief Economist for Dundee Economics have come to the same conclusion. This is why their articles were posted. We’ve had Martin on this show as a guest in the past and he seems incredibly well-informed and is far from silly or ridiculous. When he says something like, “What we are getting now is some uncertainty about the market – that has made gold interesting again; it is a play against equity markets…” then that is something that deserves some consideration.

    Jan 22, 2016 22:53 PM

    Dragonite to answer your Question before (Reprint)
    On January 22, 2016 at 10:39 am,
    Bill says:

    Dragonite,
    I bought a lot of PMs 2000 as I knew there was a major crises brewing in the US(and globally).
    I warned family to buckle up 6 month before the housing bubble burst…They didn’t believe me and were living in cars for a while. The crises is behind us and although there are major issues around the world we are muddling through….
    GOLD IS NOW GUESSING…Oil as I said only less then a week ago was a buy very soon. Oil has real predictable supply / demand fundamentals you can track…Billions burn it in their combustion engines everyday unlike Gold (smoke and mirrors) don’t believe me? The experts (Gold pumpers) I spit on 1-2 years ago have been DEAD wrong and if you held shares any amount of time your teeth have been smashed in. (other then a few COs)
    I was going to give Al some good insights but blew it off ass their too many fools here.
    ie a Real opportunity was to buy CND beaten down Preferreds paying %6 DIV a year. There are up should recover 30-50% in the next year so it would be a tidy $200,000.00 profit IN SAFE PREDICTABLE COMPANIES…AND I get 5% to wait it out while banks pay F-all..
    Now if you like to dream and listen to busted clocks that may get it right one day Ive got one in the garage OR you can listen to Bob Moriarty..
    Al-thought gold can catch a bid Ill take the same prudent money…Mathew talks about Gold being up 17% against CRB…daaaa. Did he make 17%? No point in pointing out exact bottoms and tops because YOU AINT getting them. Did he make trade on that??You cant even…. so who CARES.. One thing is for sure Ill pull down $700k this year so I could give a SH#T what people think…I was just trying to warn people 1.5 yrs ago about the bogus calls on gold and the CRB…look at some charts…
    People I know would rather buy a classic car then gold…You don’t live forever and gold isn’t a lot of fun..
    Go buy a Shelby 500 428 Cobra jet…FUN!
    http://stockcharts.com/h-sc/ui?s=PLG.TO&p=D&yr=1&mn=4&dy=0&id=p31314346514&listNum=1&a=420907867

      Jan 22, 2016 22:00 PM

      Bill…..I thought you GUARANTEED , that you quit. this site….lol……Glad your back.

        Jan 22, 2016 22:09 PM

        your….to you’re………..

        Jan 22, 2016 22:16 PM

        +1 Frank, I knew his guarantee didn’t mean much. Beware people like that.

        Jan 23, 2016 23:51 AM

        I saw a request for a reply from big D….and just sitting waiting to ride.
        And Big D
        YES Gold is way a great way to hedge in certain times no doubt.
        after the 80s it was a time to hold other investments for 20 years…..
        And depending what currency you are in…
        Adios amigos I’m off to pull wire so a 35,000km road trip this year
        Take care and be careful shes a topsy turvy world!
        Up $12,000.00 2days on ZPR and CPD…we shall see…..No body know jack for sure..

          Jan 23, 2016 23:27 PM

          Is this the CPD you are talking about?

          iShares S&P/TSX Canadian Pref Share Comm (CPD.TO)

            Jan 23, 2016 23:29 PM

            Just wanted to make sure as I get turned around on whether people are using US, or Canadian, or occasionally Australian and London exchange tickers.

            Yeah it is pretty oversold and looks like it could bounce for a bit up to resistance at $12.03 or $12.57, but the over all trend has been down for a while. Do you think it may be bottoming for good?

            http://stockcharts.com/h-sc/ui?s=CPD.TO&p=D&yr=1&mn=0&dy=0&id=p05614528739&a=432115951

            Jan 23, 2016 23:24 PM

            Lord knows…. but It crashed to a double bottom and when lower…People really got beat up and threw in the towel. Perfect. Rock solid companies and I can’t see why it sold off this much. Small DIV reduction…Yielding 5.6% is sweet..
            2007 too 2009 DIV went way up stock crashed with the market!?
            2014 at $15 it yielded 4.8%!!?? Makes no sense and shows the irrationality of investors.
            With sh#t interest rates and going lower its a no brainier..
            My US REITs sold off a bit in the panic (who cares yielding 9%!!!)their already right back up and blowing the markets performance away. If they do 10% this year Ill be a happy camper… I’m going to have a good problem EOY…Huge taxes to pay…
            My very smart buddy and Hedge Fund manager says.
            “Preferred Shares will have a good year..With iShares S&P/TSX Canadian Preferred Share Index ETF (CPD) at C$11.24 and BMO Laddered Preferred Share Index ETF (ZPR) at C$8.62 (Jan.
            15, 2016), we predict that preferred shares will have a great year from this point on. These are extremely low levels. We expect a very strong move up for the rest of the year.”

            If you you decide to by don’t wait. Good luck…

            Jan 23, 2016 23:56 PM

            If oil sees $25ish back up the truck…rally could move it to $50 and that will be it…
            Theres no way in hell gold is going from $1100 to $2200 never mind in a year.
            This is a pretty safe bet. Just got to get the bottom.

            Jan 23, 2016 23:01 PM

            Thanks. I appreciate the ideas and analysis.

      Jan 22, 2016 22:09 PM

      So gold does make sense from time to time. That is what I ask you. It may make sense again since we are having another crisis. Sovereign default crisis. Take care

      Jan 22, 2016 22:34 PM

      The hard assets I buy are Porsches & Audis. I can’t see any benefit to gold either as there are big dividend paying oil companies available. I heard Seinfeld is selling 3 of his very old ones in the over million to 5 million each area.

        Jan 23, 2016 23:40 PM

        Lol bang on dude.
        Those cars never took a 50 point hair cut lol
        Yup my case and point.

    Jan 22, 2016 22:58 PM

    Hyperinflation……….Venezuela…..some expecting 700%plus……from last years 275%, …food shortages…..zerohedge.

    Jan 22, 2016 22:42 PM

    I will be buying dips on the one year charts on BABA and ECA. I will play short plays on NUGT and UWTI when the charts turn bullish on the one year. Been burned too many times on these sputter rallies. I plan on holding BABA and ECA for YEARS. UWTI and NUGT are for short plays but ONLY when they start bull trading. I have a big position on SPXS for the near future.

      Jan 22, 2016 22:59 PM

      Jason, ECA has big debt. I have some I did not have chance to sell before the crash. I just hope someone is buying it out. It does have a lot of good asset they can sell.

        Jan 22, 2016 22:00 PM

        I heard several people talking about someone may buy it here in Calgary.

    Jan 22, 2016 22:55 PM

    ‘This week’s bizarre capitulation selling pummelled the HUI to an extraordinary 13.5 year low. It was the lowest HUI close since all the way back in July 2002. Back then gold was trading near $305 and had yet to exceed $329 in its young secular bull. This Tuesday gold closed near £1087 or 3.6 times higher. Yet gold stocks were trading at levels last see at around £305. Does that make any sense at all?’ writes Adam Hamilton of Zeal Intelligence.

    http://www.321gold.com/editorials/hamilton/hamilton012216.html

      Jan 22, 2016 22:46 PM

      This is why the opportunity in select miners will be very rewarding when the commodities do bottom. The percentage increase of some of these miners when they take off will smoke the metals themselves. It also means that when the commodities are in a cyclical bear like they have been that the miners under-perform. It’s a 2 way street.

      In addition, the miners have had all kinds of crazy stunted growth issues, towering debt burdens, rising input costs (until the recent reprieve in energy prices, but the sector was toast by then), currency challenges, management issues, exploration screeching to a halt, ETFs that have been introduced in spot prices that reallocated investment money that used to go to mining stocks, and the closing or at least minimizing of commodity desks in many trading houses. We are in a much different economic backdrop now in 2016 than we were in 2002, so just looking at the price of Gold and the price of miners then and now is apples and oranges IMO.

      Jan 23, 2016 23:50 PM

      Markets dont have to make sense.
      Ask Bob how his Bull market prediction went 1.5 years later. Lol I beat him up last Nov Dec 2014. I didnt want to see anyone else lose anymore money from these clowns pumping gold.
      I do this part time and can make better call long term then most.
      I could give a rats about short term. Just want the big pic to plunk down lots so I can get back to my cash cow day job. $2500–5000 a day. Hard work but it pays for the milk.

    Jan 22, 2016 22:43 PM

    I am not buying this oil rally…. but maybe I should…

    Monday the world was petrified that Iran was about to flood the world with oil and drive the price down lower and lower in a race to the bottom with Saudi. Everyone seems to have forgotten that once Draghi had spoken on Thursday. Maybe Draghi was just used as an excuse to ramp oil.

    If Draghi talking about the possibility of more QE in March is enough to do this to oil in 2 days in January… what would actual QE do come March or any other time?

      Jan 22, 2016 22:08 PM

      I heard people say Iran needs years before they replace their old and out date technology before they can significantly increase the output. Now what they can do is to stop selling their oil on the black market to China and India and sell it on the open market. Not much net increase. I am not sure but it is very logical. A Iraqi guy whose father is very high level said that an Iranian black market dealer said that once the sanction is released, his company will have to stop operating.

    Jan 23, 2016 23:39 PM

    The loonie is going lower so is oil.
    @ $25 people will be calling for $10 then thats your signal. At 10 id by a bloody tanker full
    Yes huge increases in extraction efficiency and decrease im consumption and more efficient vehicals. Ive got an electric car. Or i should say i bought one for my wrecking ball lol.
    I post here 6 months ago our very stupid gov will have to stop LNG ads telling us how great it would be while they piss my tax $s down the drain. They did and LNG is way dead like I predicted.