A focus on the downward pressure on gold and the technicals on the USD
Doc is with us to discus the continued move down in gold. We have been on record saying that gold will continue to slowly drift down into the $1,275 range and today with the metal briefly breaking $1,308 we could be in for more moves down next week. We also take a short and long term look at the USD. The weekly chart is telling a different story than the monthly.
Click download link to listen on this device: Download Show
The German DB. is saying to the US gov’t ,we are headed east, you’re time is up, Russia and China have the gold,…… and did you forget, you still have the German’s gold ,like about 6 yrs overdue. AND your ZIRP stinks.
Check out the Twilight Zone article at Usawatchdog.
Jerry,
Hope you are doing well. What Twilight Zone article are you referring to? Usawatchdog has no articles just interviews.
Hello JMiller,
Great ,and thanks for asking.
Check Warren Pollack article.,last week
Hello JMiller,
Great, and thanks for asking ,HOPE all is well with you.
Check Warren Pollack article last week
Well of course they will object. Just take a look at what 15 billion dollars means to them as a fraction of their liquidity reserves outside of Europe in subsidiaries and foreign branches (eg, US operations included). It is a very big deal.
Deutsche Bank Liquidity Reserves – 2015 Annual Report
https://annualreport.deutsche-bank.com/2015/ar/risk-report/risk-and-capital-performance/liquidity-risk-exposure/liquidity-reserves-liquidity-coverage-ratio-and-funding-risk-management.html
Maybe the DOJ is trying to break the bank…..just a thought.
What I mean to say is that governments in the US and Europe seem to be in the mood to hand out pretty heavy penalties to the banks lately. And there is a tit for tat contest of fines going on between governments and private companies on both sides of the pond. Take apples recent tax troubles as an example. Apple gets whacked first by Brussels and then days later Deutche gets clobbered by the Department of Justice. Not a coincidence. And anyway, I don’t know why so many keep saying the banks are getting a free ride on the back of Quantitative Easing and ECB initiatives when in fact they are being robbed by government even as they are supposedly being supported by Central Banks. This is some feaky pissing contest with the victims being shareholders and the companies themselves. It could not be coming at a worse time. Everyone understands punishment but when Deutche is being kicked in the teeth when its already so down on its luck then I just have to wonder if the idea is not to send a big message to Europe to get the hell off Apples toes. But Deutche is not just systemically important. It may be a critically important bank to the world economy. So this is a very dangerous game that is being played and we all suffer if nobody blinks.
Deutsche bank is just aching for a S&P downgrade to B paper..
Doc,
I like seeing it as you do. I think the dollar does a blowoff top at the end of this month and gold continues to fall for a while. It should get a bounce after mid October. But like you said, then continue south for a while.
Speculators cut dollar long bets to $7.13 billion – CFTC and Reuters
Sept 16 (Reuters) – After increasing their favorable bets
last week for the first time since late July, speculators again
reduced their net-long U.S. dollar bets, according to Reuters
calculations and data from the Commodity Futures Trading
Commission released on Friday.
The value of the dollar’s net long position fell to $7.13
billion in the week ended Sept. 13, from $9.10 billion the
previous week, data showed.
Net-short contracts on the British pound fell for the third
week in a row. The number of bets against sterling touched
all-time highs for six straight weeks following Britain’s vote
in June to exit the European Union.
(Reporting by Dion Rabouin; Editing by Steve Orlofsky)
Has Doc ever had gold going up, rather than even to down?
I’ve made a killing in this market while Doc has been the “naysayer”.
In terms of TNX/PRII, you can compare the October 2010 low and the recent low of July, 2016. TNX/PRII seems to turn back down after testing the 34-week EMA in 2010. The gold price correction you see in the background in 2010 appears similar to what’s happening now. I’m assuming from this chart that the requirement is a decline in the $U.S., since the correlation is at an extreme and should rise. This chart updates after 7pm. after markets close.
Article in FT discussing VIX-related inflows:
https://www.ft.com/content/1c8383aa-7b65-11e6-ae24-f193b105145e
I was curious about that VIX article, but I couldn’t read it without a pop-up from their site asking me to subscribe to read it. That could just be on my end, but it sounded interesting. Thanks FranSix.
It’s worthwhile to subscribe to FT, their blog ‘Alphaville’ has excellent discussion on markets. They just want subscribers and won’t advertise. To read the FT website at will, Like the WSJ, you’ll need to buy a subscription, but Alphaville is free. You can also read FT articles free until you reach a limit.
Got it. Well I’ll look into both FT and Alphaville. Good stuff.
Very good financial blogging without hyteria.
Sounds refreshing. We have a few posters here at KER that are beyond hysteria 😉
Here is a great article from ZH on this year’s gold “rally”
http://www.zerohedge.com/news/2016-09-15/evaluating-%E2%80%9Crally%E2%80%9D-how-long-get-10000oz
And here’s another simple reason why I think paper gold will take a dive: the record short position needs to be covered profitably. As far as I know, THEY have not failed to do so in many years.
Gold HELD again …1307
Jerry, intraday it hit 1306…..not a good sign.
Bird,…..you should go and listen to Warren Pollock article “Twilight Zone.” He gives some additional thoughts on The West vs.China/Russia banking . At Usawatchdog
Thanks Jerry, but no thanks. I am not a fan of Pollock. He gets too crazy for me.
Time for a glass of wine and a listen to Andrea Bocelli….”Nessun Dorma”
+1
Vincero’
Translation…”I shall win”
That was a fine interview boys. Best one in days. The one comment I was not able to agree with comes near the end of the show when Cory said that the monthly chart is warning of a bearish trend in the dollar.
Quote “shorter term dollar up but longer term this more bearish dollar downtrend could continue”. — Cory F.
I am not sure if that was just a mix up because up until that point Doc had been suggesting the monthly chart was bullish for dollars and on that score I am in complete agreement.
Lets take a look at the chart.
If you take the really big view the dollar has been forming a rounded bottom that began all the way back in 2003 and its continuation of that pattern indicates it may fall no lower than .90 before embarking on the next leg up.
So shorter term bearish on the monthly and longer term very positive. That massive bowl shape could take us all the way up to 1.30 if it really persisted before settling back down a little.
The US Dollar on a monthly chart – Notice the massive rounding bottom pattern. Its pretty hard to ignore and honestly, its pretty convincing if such technical shapes are familiar to you.
http://finviz.com/futures_charts.ashx?t=DX&p=m1
Sometimes the discussion about gold in these interviews just drives me nuts. How can you really talk about gold without talking about the move up in the USD today? Your measuring stick is made of rubber. Gold was actually up due to normal trading today and up against other currencies. It is like you are all sitting in a boat on a rising tide and are trying to convince me that the land is falling.
Deutsche Bank Says “No” to $14 Billion DOJ Fine: It Must Have Learned Its Negotiating Skills at the Trump Institute
The old adage that when one is already in a hole, one should stop digging, has apparently not found its way to the corner offices of Deutsche Bank. After a non-stop two years of scandals, the Bank has decided to take its shareholders on another heart-thumping cop car chase by publicly feuding with the U.S. Justice Department.
http://wallstreetonparade.com/2016/09/deutsche-bank-says-no-to-14-billion-doj-fine-it-must-have-learned-its-negotiating-skills-at-the-trump-institute/