The gold and oil stocks are telling us something
Chris Temple and Doc wrap up the markets with a focus on the downward moves in gold and oil stocks. We have been saying that these sectors got ahead of themselves and now the stocks might be telling us that the correction is happening.
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It’s just amazing what we’re seeing unfold in Canada and the globe. The rich and those that have done well because of the policies of politicians across the globe and the bankers will continue to do well as long as those policies and monetary manipulations continue. On the other side of the coin, the responsible and hard working middle class and those below continue to get hammered along with the responsible “saver”–many corrupt/irresponsible have benefited for years but when the whole system is ultimately shaken even their wealth will be compromised but most will survive devastation. When one looks at how we got here, we realize that the enemy is really us when we allowed representative government for the people to become representative government for large corporations, the big banks and the corrupt. The happenings in Alberta is just a small symptom of bigger problems lurking.
Welcome to the world of money changers doc.They had crucified Jesus and now they are crucifying the savers.
“Give me control of a nation’s money and I care not who makes it’s laws” — Mayer Amschel Bauer Rothschild
Well said, Doc.
Doc as Micheal Campbell says we are in a bull market of corruption.
I happily sold all my PMs yesterday….weeee will see how the correction plays out? A birdie in hand! Right Birdman.
AND Hell of a sad thing for Ft Mac…my GOD…
Meanwhile in the very south of Alt I bought a commercial building. The chips are down you go shopping…For the price of a tear down in Van Ive got $270,000.00 cash flow…
Not sure what people are thinking……
Life has always been boom or bust, when times are good you must prepare for the bad days that will come no matter what. The government must be treated as a band aid solution and not relied upon as a savior for dire times. This is the way it has always been and will always be. DT
The FED cause the boom and bust in the business cycle…..if, we did not have a FED, we would have less bust…..the bust is the opportunity for the bankers to rake in the assets, at a discount.
When will the public ever learn the FED CENTRAL BANKERS MONEY CHANGERS are the thieves.
Incomes there are quite high. I know on lady who makes around $235k there as a mechanic.
What happened in Alberta today?
So, let’s all pile into gold and silver shorts for May and probably into the summer.
Nicce spike up to the recent highs tomorrow and then it will be like one of the Six Flags rollercoasters on the downhill run… or maybe not.
We’ve had the up bit in gold and silver and now comes…
https://www.youtube.com/watch?v=AfBBq04ZScE
(How people go on these rollercoaster rides without having heart attacks or strokes is beyond me?).
I agree with these guys! Its May and time to go away!
Buy back into gold stocks in September.
Sell it all for now. July and August summer doldrums are the worst, how can anyone forget after so many years in this game.
Cheers!
Chad,
Having looked at JUST the GDX over the 2009-2015… it just seems to me that your comment is NOT supported by historical data.
I had already commented on this “summer doldrums” thingy 2 days ago – as far as the stocks are concerned.
Best to all,
LPG
Ok, thanks! I have not been on here for a while.
If trade is falling off a cliff
I have a problem!
http://stockcharts.com/h-sc/ui?s=%24BDI
If we have price deflation
I have a hard time seeing it in most charts
http://finviz.com/futures_charts.ashx?t=GRAINS&p=m1
And similarly for meats and softs.
It is obvious that it is hard to believe it because the last time the world has experienced such an event was in 1930-32.Never happened in our lifetime as long as you are not 86 plus years old.
For a longer term picture:
http://jaytaylormedia.com/inflation-or-deflation/
Nice candle on the USD Index yday on the daily chart.
Big picture, the monthly chart is fugly… and it needs some SERIOUS short-term boost to revert its downward momentum.
My 2cts.
LPG
The market is just not falling hard so I got out of my vixy position at a loss after accumulating for weeks as it was dead money. Not going to touch that again as i always end up with profits in my oil trades and a hit an miss with other trades. Oil is still quite strong and should hold up the market. I added BP shares today. I think oil will range between 40 and 60 this year. It did not even correct to 42 where I expected it would.
May just got started Paul. I don’t doubt that volatility will pick up, but I’ve been trimming my TVIX position back as it has bounced above my cost basis intraday this week and have a position near parity. It is not if volatility will come back but when….
Patience is the name of the game.
I am not playing with the vix anymore. I sold over 6000 shares yesterday. I can make profit about 90 to 100% of the time with BP oil. I have never turned a profit with vixy. BP is rising up today like I expected. I did some heavy buying yesterday.
The vix is likely to keep declining like last year into the summer.
I wish you all the best with BP then. I’d say any trade that you can do 90-100% of the time is far above average and I’d stick with that as well.
But oil is on its way back down. Does BP do well with low oil prices?
I mean, WTI dropped more than 3 dollars in three days and then put in a great big fat reversal candle. That would not give me confidence about oil companies right now. The other thing is BP has pierced its upper bollinger band and furthermore could not exceed to the upside of its 50 day.
This one is a sell in my books.
VIX rocket launch is just getting started, but the market may bounce for a few days here.
I am out of it with a loss that I offset with a VRX trade today.
Notice the high beta crap like biotech getting kicked back down to reality.
Yep. I guess Biotech wasn’t the place to be after all 🙂
I would not come to the same conclusion. Let me show you guys a longer term chart that might just change your minds. If you are familiar with Elliot Waves you will pick on my point in 3 seconds flat.
So here is IBB on a ten year chart. The very large chart is necessary or the pattern is not obvious. What you need to note is the very clear five wave pattern that begins in 2010 and runs all the way to a peak in middle 2015.
From that peak we now have what looks like a 3 wave decline that is a classic Elliot corrective chart formation and that looks to have bottomed into a consolidation pattern (the 3 wave decline is somewhat subjective to be honest).
In other words, if the count on the decline is valid then IBB is not going to fall further but should begin another run upwards sometime this year. Your guess is as good as mine as to when that happens but I would not count biotech out of the game by a long shot.
iShares Nasdaq Biotechnology (IBB) on a Ten Year Chart
http://finance.yahoo.com/echarts?s=IBB+Interactive#{%22range%22:%2210y%22,%22allowChartStacking%22:true}
Thanks. I’ll take a closer look at the longer term chart set up on IBB and look for where support levels may present the ideal entry.
That is probably a better approach. The 3 wave declines are confounding to almost everyone and they usually last longer than you expect.
Matthew I am long corn and silver what do you think?
I hope you’re long from much lower levels because both look like they have more downside.
Silver appears to be the stronger of the two.
Your right I am thinking that the commodity run is over, it was good while it lasted but I guess that nothing has really changed like I thought it had!
For now, I think it’s just a short term top. Silver in particular could surprise us soon to the upside just as the dollar looks likely to negatively surprise dollar bulls. Here’s the dollar without the intraday noise:
(For those not used to looking at price charts, the three red lines I’ve added represent resistance that price must overcome.)
Despite the short term sell signals, silver managed to outperform gold today.
Silver:Gold
That could be a bull flag forming despite the looks of that MACD.
I’ve actually added a little to Silver stocks yesterday as everyone was selling 😉
Well that warrants an “atta boy” and a silver star. 😉
Ha! – Thanks. Well it worked out as many of them bounced today.
Fellas – If you look at gold, silver, GDX, GDXJ, HUI, XAU, NUGT….they have all dropped to touch a rising trendline today. In other words, they are all at an area of technical support. I am looking for increasing gold and silver price tomorrow…we will see if it can go on to the 1300+ targets we have talked about, but I am not concerned yet with the gold price just yet and think it is going to go higher in the near term…if I am surprised and it breaks that trendline tomorrow, then it may be time to get ready for the seasonal spring drop and summer doldrums….we will just have to see what the markets tell us.
Falling stocks will be good for the miners.
The Russell 2000 is not looking well:
Oil has a strong buy signal on the hourly, daily and weekly chart. We could have a good rally in the markets tomorrow. I dumped my vixy just in time and loaded up with BP.
The senior miners look ready to drop another 5 or 6 percent tomorrow…
Here’s GDX. The lower channel support will be about 5.3% below the current price tomorrow.
Here, we can see the potential for a 6.5% drop:
Btw, notice the SCTR indicator at the bottom of the page. That’s what a bull market looks like.
Gold is holding up very well.
Copper might find some support tomorrow…
I am convinced that Venezuela is going to become one of the big news stories of the year. At this time we are all aware there is trouble there but the reporting is still sporadic at best and the country has never gained the limelight the way Greece did two years back.
That could all change as the country risks spiraling into a political uprising or even civil war due to a complete breakdown of the system that normally keeps a country operating. There is no longer any confidence in the governing system. What holds it together seems rather baffling and I suppose we can say that the citizens, until now, have been stoic in the face of real deprivations.
But serious social discord is percolating under the surface with strikes, riots, extremely high murder rates and protests marking the beginnings of what could easily turn a controlled descent into a social conflagration.
The government is running out of options. It is running out of money and most importantly it is running out of time. The grande Socialist experiment is going to be put to a test and I think it will happen around the time of the Brazil Olympics in three months as media attention becomes much more focused on South America.
But there are still options for the country. Venezuela is only broke on the surface. Deep in the ground there are assets more than sufficient to cover its debts, restart the economy and stave off the inevitability of a social backlash that would overturn the existing ruling class.
We are talking oil of course and the choices here are obvious. Venezuela will have to open its fields to foreign companies once more, return assets that were nationalized in the past and sell forward production in order to attract the billions of dollars the country urgently needs to start rebuilding.
We won’t even pretend the problems there are minor. Poverty is endemic, inflation off the charts, shortages pervasive and the outlook for industrialization to diversify the economy is just tattered papers and hollow dreams. Some 95% of all their income is from oil exports. With such depressed prices the country is experiencing pain quite unlike any other developed nation on earth at this time.
As the country has now sold off or leased its remaining gold there really is only a single option on the table to raise desperately needed capital and attract foreign investment.
But it will not be easy choices and the leadership of the country is going to be faced with the difficult challenge of having to openly abandon its flawed idealism and embrace free markets unhindered by the current top down interventions in all aspects of business and the supply system.
If the governing party cannot grasp the seriousness of the chaos that has already erupted they will indeed be in jeopardy. This could be a long hot summer in Caracas. Lets hope that sober minds prevail and solutions can be found to bolster the urgently needed foreign exchange reserves.
Venezuela needs foreign oil companies. Its time to get them to the table because all hell could break loose sooner than most imagine and if the current crop of leaders cannot come up with the obvious solutions I am pretty sure there are others standing in the wings who can make it happen.
Venezuela should be rich. Instead it’s becoming a failed state.
https://www.washingtonpost.com/news/wonk/wp/2016/05/04/venezuela-is-becoming-a-failed-state/
Comrade Hugo would be rolling over in his gave….the Bolivarian Revolution is stumbling….perhaps the socialist ideology is less about equal opportunity and more about equal suffering….yet another failed attempt at Socialist Utopia.
We haven’t seen anything yet. Oil by my estimates will see 20.00 dollars before two years are out. Caracas will be in flames by then. It is a pressure cooker and a cauldron as we speak. It seems improbable that domestic peace will prevail as the country sinks into utter bankruptcy and even the wealthy become destitute due to epidemic shortages. But there is never any guarantee how these things will play out. The government could enforce its will against the population by force or they could seek solutions with the international community. It’s a coin flip as far as history goes. Whatever happens….we will start hearing a lot more about that country soon enough.
Confessions of an Economic Hitman.
Vensuala might have had a chance if the Americans hadnt been doing everything possible to destroy them.
I think the Americans will increase their efforts in S America with Russia and Iran accepting other currencies for oil.
Brazil is being attacked as well, Argentina I think (forget for sure) Ecuador of course.
Its all about the American corporations, along with that “trade” agreement,(tpp somethin?) corporations over sovereignty.
Mussolinis fascism perfected.
At least thats their goal.
You see, this is all about sphere of influence. If the Chinese want to insist on their local region as the South and East China Seas and Russia is adamant that Ukraine is in their historical backyard territory then by default the US is within its rights to assert privilege over the America’s.
It’s not that big a stretch to carve up the planet by geography. Been done by empires many times before. It’s why the Russians got sent packing from Cuba so many years ago. It’s why the English had to abandon Hong Kong.
But who will claim Africa now? The Europeans?
Interesting discussion.
JC
just like Sweden, Norway, Finland and Denmark were eh?!
My advice is IGNORE Chris. He has a negative bias toward goldbugs.
exactly the point. It is not crucial at all. Especially when it comes to gold and silver.
My concern is, your listeners get scared because of comments from Chris and Doc.
Chris in particular constantly beats down those who want to protect themselves against the monetary madness of the John Maynard Keynes school of thought. e.g. goldbugs.
One day they are bullish, next day bearish. At least that is how I interpret their comments.
The risk is not being in the gold and silver markets, period.
It can literally destroy you and your loved ones.
That’s pretty funny Dave.
You know. if I want to read anyone speaking sensibly about precious metals and taking a contrary stance against the madness that is prevalent in the gold community right now there are just about zero resources available.
What we are seeing and hearing among the bugs is symptomatic of the common herd effect. It is classic group-think but on steroids. They are clearly intoxicated by this recent success in their much loved asset class and totally unwilling to hear any other viewpoint.
With sentiment numbers now showing 96% bullishness on gold, silver and the miners it should be obvious that only one opinion is being expressed and encouraged. And if you read any other metals sites you will know this to be true.
That does not make that single view right though.
I honestly cannot think of a popular analyst other than Chris who is attempting to inject a little sanity back into the thinking of the bugs. Even at that he is pretty mild in his comments so I would not take too personally.
So rather than asking Chris to silence what a few of us believe are very sensible objections, you might instead consider what he is saying. And while you are at it, just take note that it is actually you, one element of the crowd in this mania that makes up the herd of buffalo, that is rampaging madly towards the cliff edge together.
If you think this is expensive, you need to re-think
http://www.infomine.com/investment/metal-prices/crude-oil/5-year/
Priced in GLD, ETN OIL is down more than 90% since 2008:
Bird,
Very good points on Chris, but he was also the guy in the last week of Feb-or early March who said not to get greedy and used “pigs-to-the-slaughter” phrase to indicate that a correction was iminent and the “gold-buggey-classes” were about his the windsheild. He was dead wrong on that and the stocks rallied a hell of a lot more from there. My point is that extreme negative and positive views are usually off the mark be a lot in these cases. Of course you are right that gold SHOULD correct here; this is a common view throughout the financial investment classes or Trader-Class right now. Although I sincerely doubt it will happen, I pray gold corrects to the $1000ish mark like you are predicting, but in the mean time, save for silver stocks, I’ve been trailing my gold stops up and up and up. It ain’t easy to take all this noise with a little salt and continue to make money and protect our behinds.
What noise? Its all bullish talk everywhere I look. but I would agree there are more and more coming around to the idea we will eventually get a correction. Just nobody can agree on when or where it will start.
I think gold and silver have already topped but I have been wrong before. Its just my charts say this is pretty much over for the time being.
Norcini, Gann, Bob M
There are a few talking correction.
What would be abnormal is a constant increase in price that doesnt correct.
Maybe thats exactly what will happen, no rush like a gold rush.
Thanks b. I get so overwhelmed by the bull-extremists I sometimes forget there are sensible people left in the world. Larry Edelson was another who sent out a warning. So did Gary. There was another guy too…Przemyslaw Radomski, but when I mentioned his good work last week “you know who” started to shoot him down based on one missed call as if that proved anything at all about the current commentary.
Silver is heading for another fall tomorrow btw. Don’t get too excited about today’s little rise because I am pretty sure it is not going to hold. By the time the Thursday is over we will have a bearish candle created.
Radomski is a permabear that blew this year and at many obvious lows during the last several years.
…I guess that’s why you can relate to him.
If the word “sane” is the same as perma-bear then I would agree. Radomski has done excellent work in the past. You might learn by following him instead of quoting that perma-bull you keep crowing about all the time.
Lol, and YOU know sanity when you see it don’t you! 🙂 🙂 🙂
They look like they have. But didn’t they in March too? Having said that MSBC is touting the metal s that is not a good sign. Maybe I will move out of my paper-gold stoics tomorrow if it isn’t too late.
MSNBC too? I cannot believe they would do that. Or maybe I should believe. What a bunch of rats. Right at the damn top they start pumping for the masses and the hillbilly’s that watch the show.
Does it get more transparent?
Re: “Of course you are right that gold SHOULD correct here…”
Says who? We can all see the technical case for a correction here but no one is qualified to say what the market SHOULD do.
The market tells US how it’s gonna be, not the other way around.
Some of us are more qualified than others.
Thats right, we have to wait and see.
I think people on these blogs get caught up with people on these blogs.
There are a whole hoard of people that never bother with them.
Market annalists etc
From banks, funds money management companies.
I see them interviewed on occasion.
They can be complete opposite to these blogs and be pretty darned accurate.
I cant help but think that eventually gold should move higher, it has kept its purchaseing power for centuries, I dont see why it would stop now.
Other than currencies moving to digits of course.
Because it has not completed its decline yet from the speculative mania that ended in 2011, bb. That’s why. Gold is still overpriced and needs to correct further down the chart. What we have seen thus far is nothing more than a bear market rally within a larger falling trend. We have NOT seen the final bottom for gold yet.
This recent spike surge was exiting all right. But personally I would sell it while there is still time. That is in fact exactly what I am doing by being short the market (that is not trading advice, by the way….just my opinion).
“exciting”….. not exiting……sorry.
I kinda think your right Bird, my perspective is longer time frame, after this “correction” gold should increase, historically gold moves with money supply, well, since the advent of paper anyway.
Gold being revalued fixes alot for example.
Not saying Im right, but to me the only thing that would stop gold from doing what its “always” done is digital currency.
Im in the 5-10% physical camp, but I have little other choice, to be honust I would rather have chickens,orchards etc
At least with gold instead of chickens I dont have to feed them.
Positives no matter what ya do. lol
First the BDI……drops like a rock……….NOW , 293 ChooChoo train Locomotives set idle in the NM desert……….check pictures at zerohedge….
Yeah, shipping has come to a near standstill because of all that pent up demand in shops across America and people still want to tell me about all the inflation that is coming. /sarc/
Why not look at BDI.
http://stockcharts.com/h-sc/ui?s=%24BDI
I see BS from zerohedge if they said the BDI is dropping like a rock!
Thanks for the post…..MARK, use to keep us informed of the BDI, it was my mistake for adding “First the BDI” which was down several months ago., I should have checked before posting…….But, with such a wise crew , I knew any mistake would have been corrected , I am surprised BIRD did catch it………..I do not follow, nor did I follow the movement up, Very surprising the turn around. So, if we have the BDI up, and the Locomotives in storage , what is that telling us. GOODs on the way……or are they floating around in the ocean?
didn’t catch it…………..
Here’s a DUST chart that I posted several weeks ago that I hadn’t looked at since – until this morning. I was a little surprised to see that the symmetry that I had anticipated actually happened, albeit a little later (arrow with ? next to it).
I think a final plunge is going to happen.
Very possible it falls back to 1.32 but I would not hold my breathe for much more.
I think it’s going a lot lower than 1.32.
You think a lot of things but they often don’t pan out. You thought the Canadian dollar looked fine just a day or so before it dropped 2 cents. I am not saying that it is impossible a lower point can be reached on DUST but I think its less probable than you do. I will leave the possibility open that silver / gold opt to make double tops but that’s about it.
They pan out enough. My portfolio was up 3.72 fold as of Monday since the January low and is off less than 4% from that level now.
Gee, Is this the tenth time you have told us now? Maybe 11th?
Actually that was the first time. 3.72x is a recent new high. I realize that details aren’t your thing.
What you fail to realize is that your stature does not increase by the size of your lies, Mr Anonymous.
I love it, Mr Anonymous Liar himself throws out yet ANOTHER lie. But that’s scum for ya.
ahhh those sparks just keep a flying.
And its not as if housing was not already a problem in Fort Mac. What a nightmare. This is absolutely devastating for the Alberta economy, not to mention the livelihoods of thousands of workers. Alberta claims it is already in a near depression. A very sad day for the whole country. Lets hope they can get it back on track soon.