The Continued Downtrend in the USD and the Gold vs Silver Discrepancy
The USD has been moving down pretty much all year. Chris Temple and I discuss the dollar trend as well as the discrepancy we are seeing in the Gold price (up over 5% this year) and silver and GDX (both pretty much even this year.
Click here to visit Chris’s site for more great market commentary.
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SMI (22/06/17) : Thomas Lagrée – Keynote Speaker
Swiss Mining Institute – VIDEO presentation
SMI (22/06/17) : Claude Bejet – Keynote Speaker
Swiss Mining Institute – VIDEO Presentation
Spot Chris the US$ has not closed below 93 off the weekly chart in 2 1/2 years Cory the $ came off more so in 2016 down from 100 to 91during the same time period. $Yen support is in play today at 87.75….the BOJ announcement last eve was at zerohedge and their action along with a hot NFP as I suggested is hitting gold and silver and the miners = event driven yet again. Your 100% correct Chris as hedge fund traders do not get hung up on fundamentals its a simple take profit trade regarding the selling of the miners…..its how those that trade for a living survive!
a “close” below $15.68 the Dec trade low would not be positive for spot silver as SLV is tapping its Dec low now of $14.85…..going to be really interesting to see what $TNX does if it reaches the key 26.15-21 area as it would be the third tag, I’m sure your watching that hot zone Chris
sorry.. spot on Chris
last nights silver crash was interesting indeed we will never know what really happened. In the FX markets as long as $5 mill is exchanged between two banks the trade is valid by Central Bank standards…..so even if the market is trading 77.60-65 if 60 gets hit and the next offer is 77.30 way below the market as long as $5mill is closed that low trade stands….a game played often when big fill orders are in play
That’s right, “we will never know what really happened.” But that wasn’t your attitude last night: “this is a pefect example in slot silver as a client leaves a large order if siovef trades below $15.67 (I will leave you idiots to figure out its significance)…”
I’ve seen many moves get erased over the years due to a glitch so it was reasonable to wonder if it was just another one. Now we know it wasn’t.
Peter Brandt @PeterLBrandt 17h17 hours ago
This is what happens to people who are dumb enough to use stops in Silver during off-peak hours. $SI_F An HFT gorge session!
Peter Brandt @PeterLBrandt 12h12 hours ago
TRUTH — Comex has stuck me with a fill on a sell stop even though the “official” low of the day was changed (to above my stop). TRUTH.
Boo boo. ….what did he expect from a RIGGED system…..
Peter’s been rough on Silver investors and has had an attitude about it, so maybe he had a little Silver karma to burn off there. 😮
Funds return to Zinc as LME stocks plunge
Andy Home – Fri Jul 7, 2017
http://uk.reuters.com/article/zinc-inventories-ahome-idUKL8N1JY2L9
I still don’t Zinc most resource investors have been paying attention to this sector’s fundamentals…..
This comment from a contributor at ceo sums up the Zinc supply shortage:
__________________________________________________________________________
@engineer – “LME zinc stocks July 7 -2,775t to 281,250t from 284,025t July 6. Day 36 of consecutive Zn inventory drops.”
Visualized at Kitco:
http://www.kitconet.com/charts/metals/base/lme-warehouse-zinc-30d-Large.gif
Silver stink report. ..lbma at it again…New tricks on the way
The con men are not going away anything soon
How about those ployment #s. Things are wonderful except for the contrived employment data. How about that USD/JPY relative to gold. The value of the yen has the very same fundamentals as gold. Sure it does. Need to expand our white collar prisons.
David its a very simple trade buy TNX sell gold sell yen….but dont take my word for it Chris T is on it as well….GLTY
$15.55 silver , …. sad and add
$14.99 not far away….
Never thought we would see this number again
I didn’t either but i think Doc did.
I picked up IPT at an average of .398 today.
I still like this sector…
Wonder if climbing a tree with poison ivy would help… 😉
I’ve been waiting a long time to pick up IPT seriously. I believe we have a little further to go and I’ll pick it up.
Impact Silver is highly leveraged as the purest play Silver producer, and their exploration upside is quite juicy.
Yes, it could go lower, at least to the bottom of the down trend channel;
http://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=5&mn=0&dy=0&id=p67903154422&a=533204677
Thanks for those support targets Matthew.
Here’s the June 2017 Corporate Presentation for IPT. I’ve noticed they’ve updated their website recently and have jazzed things up a bit. (it was needed).
http://www.impactsilver.com/i/pdf/2017-JUN-2017-06-28-CP.pdf
There will be 10,000 to 15,000 meters of drilling this year that will cost between $2M and $2.5M.
IPT has another 10 cents downside.
That’s possible, Spanky, but everyone always looks much lower at every major low.
Reason I am saying that is there is a black candle on the weekly chart around that level.
Again, nothing goes down in a straight line (…except mining stocks and the yen).
IPT has retraced 75% of last year’s move:
http://stockcharts.com/h-sc/ui?s=IPT.V&p=W&yr=7&mn=2&dy=0&id=p20537586408&a=532066390
The 78.6% Fib retracement may be the area to add then.
What is funny to me is that several months ago we mentioned that the Summer Doldrums were coming, that a sideways to downward trend is normal, and that July was typically the place where the metals put in their low, before rallying from mid August through October. Now that is what we are seeing play out and as expected, most investors are losing their minds. People are so predictable.
Personally, I’ve been buying a number of Silver stocks today into the carnage and some have already rebounded a little into the money.
Back in April/May I mentioned the plan to add a tranche in June right before the GDXJ rebalance was complete and the Fed hike was announced, and I did into that weakness and squeezed out a few small swing trades on the little blip up. I also mentioned that I was saving the rest for July when the metals seasonally put in their low.
Now it is July and as expected this is where the seasonal lows are showing up. We’ve recently discussed the oversold downside momentum on BPGDM as another indicator to alert us to an area where a bottoming process will start to occur. We also mentioned that if the metals slid further in July, after the weak June, that it would really wash out the sentiment in sector. (and here we are……)
It thrills me to see so many investors on other blogs throwing in the towel, screaming manipulation, or pulling out their hair like it is the end of the world. (haha!) What these reactionary traders seem to have amnesia of (even though it happens almost every year — with 2016 being the exception), is the seasonally strong period of August – October. Contrarian investors will be accumulating here while most reactionary trend investors are panic selling.
Here’s an interesting chart from my buddy The Hedgeless Horseman on the gap that was filled today:
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@HHorseman – “We closed a major gap in #silver today:”
GOLD Seasonality – 15 year chart [2001 – 2015]
Buy low sell high
Unfortunately most investors just Cry Low and Buy High…… 🙂
Regardless, July is typically a good time to accumulate the PMs on a seasonal basis, with a rally normally following in mid Aug – October. I know some expect the lows to extend through October, but I was a buyer today in some beat up PM stocks and am not that bearish personally. July may still serve up a little more pain, but that is the time to position.
Well unfortunately for me I always say I should join the sell in may crowd but never do. 😱
The second week of June was the time to sell if one wanted to sit out the summer but most probably sold during the first week of May. So far, such sellers are no better off…
http://stockcharts.com/h-sc/ui?s=GDXJ&p=W&yr=4&mn=2&dy=0&id=p41217293183&a=522006460
SMI Morning 6/22/17
https://www.youtube.com/watch?v=mK4NbU-fXQc
SMI Afternoon 6/22/17
Epstein Morning TA
SLV is currently at a modest Schiff fork support:
http://stockcharts.com/h-sc/ui?s=SLV&p=D&yr=0&mn=11&dy=22&id=p87091234344&a=533117841
The loonie looks superb and that bodes well for the near future of the gold space. It’s smoking the dollar today even as the buck beats gold:
http://stockcharts.com/h-sc/ui?s=%24CDW&p=D&yr=1&mn=2&dy=13&id=p05434567762&a=524751879
While it will need to take a break soon, its longer term advance is just beginning.
http://stockcharts.com/h-sc/ui?s=%24CDW&p=W&yr=3&mn=7&dy=0&id=p70282389771&a=529054473
if you look at a weekly chart of the CDN$ going back to the fall of 2012 that over head trend line resistance from 103.73 across 98.03 and 94.17 comes in perfectly today at 77.65ish….Silver has been heading in the opposite direction of $ CAD because the BOC has suggested a July rate hike which is the bullish driver
Rick A according to the trolls here is the best technical trader on the planet….I dont know his work but obviously he didnt go short off his work weeks ago regarding gold but now suggests shorting even any pops in price….wow thats bearish….I thought the lows were in based on US rate hikes….GDXJ adjustment etc…opinions of course vs the chart being correct since $1270…buy side buy buy buy
I never said he was the best technical trader anywhere. You should stick with what people actually say rather than assuming that something is being implied. It was actually YOU who tried to use Rick’s past against me when you brought up his market making.
Rick’s hidden pivot method IS a good one.
And he HAS been keeping to the short side, just so you know.
So, again, be careful with your assumptions.
it was the other troll….not every post is about you….you must be lonely!…..breathe..relax….
Ok? That’s why I’m speaking for myself.
You seem to be an expert of what “has happened”. So give us a forward looking forecast with numbers and timeframe. Thanks!
Great point Chartster….amateurs get hung up on forecasts, projections picking bottoms or tops yet you’ll never hear that chatter on a trading desk its why no pro before placing a trade stops in his tracks heads to the www to see what the opinion is of ??? we trade off momentum to the upside and downside using the tools that work for the individual trader as some are very agressive and some not depending on many factors….no different than R.A.’s chart work on gold its going lower till it turns and nobody knows when that is but when the tools a trader uses confirms a bullish turn you get onboard…..surely over the years you have come to realize its the sensationalists and subscriber based experts who always feel the need to tell the sheeple where XYZ is headed…..yet their track record is terrible especially at key lows and tops…..GLTY
Wells there’s a point I couldn’t through one Birdman’s head a couple of years ago. Expectations don’t have to be right to make money. Rick Ackerman says the same thing as well. He trades his method, not what he thinks and points out that it’s a good thing he sticks to it.
It’s ok to make predictions as long as you act on setups and manage risk.
TB:
Just how many “Pros” double as trolls and waste their entire days educating morons or are you the only one?
bob your a miserable man seeking to make others the same…..your efforts towards me are a waste of your precious time and mine so just ignore me and I will joyfully return the favor as your not in my league….sorry!…move on and attack the war efforts with your BS which as well has been wrong for years…..just like ex you mistaken me for someone who values your opinion about anything….I dont…never have or will….again Im sorry!
TB:
You keep thinking you are somehow part of a group. You are a group of one and your sole talent is cheap shots and snide remarks. If you were half of what you claim to be, you wouldn’t be wasting your “valuable” time with the surfs. You cannot determine who is dross and who is gold here and there is a difference.
I keep looking for something of value in what you say to someone and all I see is you talking about how wonderful you are and how stupid everyone else is.
Before you start running your mouth about war, you might want to pay a little attention to someone who understands it 100 times more than you do. If you are one of those idiots who support the 82% of wars the US has started since WW II and lost every single one, you are even dumber than you sound at first glance.
But yes, I am certainly not in your league. Even the clowns here mumbling about naked short selling and comex defaults have some here who believe them. You are in an echo chamber and think you are at Carnegie Hall listening to the tens of thousands of fans applauding your voice.
Did I mention “projection”? You are doing it again.
Every asset you buy or sell is you making a forecast. Picking bottoms and tops of swings or trends is where it’s at. I do like hearing others opinions of what an asset class is doing. They might be right, might be wrong. There are many people that are good at certain aspects of their trading strategy. Doc and Rick are two really good ones. Both have certain dots that connect to make a picture. My none-aggressive assets are based on weekly technicals, the aggressive stuff is daily charting.
My forecast is, metals are going down until mid August. So far, I’m right.
I’ll take the other side of that and say that gold will bottom way before August.
GOLD Seasonality – 15 year chart [2001 – 2015]
chartster agree every chart has its correct ebb and flows and every sector must be traded differently…..SHOP….is a very well known tech trade whjch has completely kept me long since Dec until selling my entire position in June as I use the sma11 for trading 1/2:and the sma 20 for my entire position….been a nice trade!
Doc must be making a killing with his silver short position….oh right didnt actually place that trade off his outlook….too bad all the money he’d make would add to all those shares he constantly nibbles on….interesting. DUST was a buy st $31.50 with no indication to remove thst short position yet up 13% in 6 days pays the golf fees!….will the May GDX low hold?
Yen is set to explode upwards over the next 6 months. US market should be headed with it. Commodities are at best dead money and at worst will start a new leg down.
The miners–it’s anyone’s guess how low they take them at this point. But I think we will eventually see 150 on the $hui. The monthly stochastics aren’t even over sold yet, but they are close. I imagine we will see a dramatic waterfall before it bounces. Does it ever happen any other way?
Remember, you can’t lose with the US stock market. At worst it will trend sideways to up for a couple of months after the next near term blowoff. There is no stopping AMZN and GOOG from taking over the world. Just embrace it and profit from it.
It may explode, but for the moment, after its current big move, a counter-trend play may be in order. BTW, this was posted yesterday morning: http://www.trendlinemagic.com/2017/07/silver-bogey.html.
GDM bounced after coming within a dollar of the May low:
http://stockcharts.com/h-sc/ui?s=%24GDM&p=D&yr=1&mn=0&dy=0&id=p98516593304&a=528708013
Some good thoughts from CEO Technician @Goldfinger:
_________________________________________________________________________
@Goldfinger – “$GDX has key support at $21, we’ve seen $gold ~$1200 and GDX ~$21 a couple of times this year already. All eyes on this descending triangle in GDX, but so far we’re seeing miners hold up relatively well compared to gold amid numerous bullish divergences. ”
Try this link for the chart (without the + sign):
Rick Rule – Prospect Generators, Uranium, Deep Value
By Maurice Jackson from Proven & Probable – Jul 7, 2017
“Rick Rule of Sprott US Holdings sits down with Maurice Jackson of Proven and Probable to discuss the deep value proposition that he foresee’s with Prospect Generators and Uranium. Mr. Rule provides listeners with a list of virtues of proven management germane to the task, with the right business model, in the right sector. Great educational tool for value investors.”
https://sofee.liberty.me/rick-rule-prospect-generators-uranium-deep-value/
CZX is having a good week:
http://stockcharts.com/h-sc/ui?s=CZX.V&p=W&yr=5&mn=0&dy=0&id=p43796706880&a=516589989
Agreed. I’ve been adding this week once I saw them announce the new drill program.
Ex, Matt
I am now a Constantine (CEM) fanboy (a past doubter), but I was wondering what you two think of BitterRoot (BTT)? I’m thinking of rotating those shares into CZX.
EX – By the way, Quest Minerals (QRM) is going bankrupt. I’ve never lost 100% on stock investment before – first time for everything, I guess.
https://web.tmxmoney.com/article.php?newsid=4597873770247629&qm_symbol=QRM
Brian
Hi Brian.
Yes, I’ve been a Constantine investor on and off over the last 2 years, but don’t currently hold a position. I like the management team and have watched a number of their video presentations on their opportunity. I like that they are mining into the side of the mountain and can let gravity assist with the mining, and that helps with costs and I like their Zinc/Copper/Gold/Silver makeup. In addition the new road access is very helpful for site access. Ultimately it was the environmental concerns about the Salmon spawning and the Bald Eagle preservation that concerned me. The town is divided over the mine being permitted and developed where half are very supportive and half are vocally against it. I just didn’t want to get into another Sabina Gold & Silver situation where the permitting got snared up in environmental concerns.
In addition the 2016 drilling campaign was not as impressive as the results form 2015 & 2014. Eric Coffin was constructive on their 2017 drilling campaign, so I’ve been re-evaluating them and willing to give them another chance. I’ve actually been debating getting back in them but have been on the fence.
Anything in particular that caught your attention about Constantine?
______________________________________________________
I’ve also been reviewing Bitterroot (BTT) and it is widely covered on ceo.ca as a popular Silver Explorer. It’s on my close watch list, but I generally like the smaller producers and advanced developers where Silver stocks are concerned. There are a f exploration plays like Brixton, Dolly Varden, Klondike Silver, Silvercrest, Defiance, Silverspruce, and Metallic Minerals that have my interest though, along with Bitterroot.
___________________________________
As for Quest mining, that was my concern with them….. they went the way of the Dodo…. like so many specialty metals companies before them….
The only specialty metals companies I like and own or may own in the foreseeable future are Alkane Resources, Matamec, UCore, Commerce Resources, Arafura, Largo Resources, NioCorp, and IBC Advanced alloys.
PS. you mentioned rotating shares into (CZX) Canada Zinc Metals…..
now that one I’m a fan of and shareholder 🙂
Other Zinc stories beyond Canada Zinc Metals that I’m a fan of are Tinka, Vendetta, Foran, Red River, Callinex, Heron, and Trevali
As far as Zinc miners I would also add Solitaro Exploration as Royalty / Prospect Generator with nice Zinc properties, and they just acquired Zazu Metal this year which has been laying dormant (up next to Teck’s Red Dog in Alaska).
Also, an acquaintance Brandon is running Fireweed Zinc in the Yukon and it just launched this year with a focus on 2 prior discovered Zinc endowed deposits.
I still think the Silver miners like America Silver, Excellon, SantaCruz Silver, Alexco, etc… have nice Zinc exposure.
Eurasian Minerals is another Prospect Generator with nice Zinc exposure in addition to Gold, Silver, and other base metals.
sil:slv ratio daily chart is set to collapse over the next month or two. Well defined H&S very very similar to the formation that formed before the January 2016 collapse.
A flush is definitely coming, although they might decide to play around before they pull the plug. Although today the daily ration is putting in a typical hideous reversal candle, so the plunge in the ratio may be just about to start.
Silver stealers.net.
Some day people are going to wise up…..or not
This chart won’t update until this evening but gold fell to fork support before reversing today:
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=0&mn=9&dy=0&id=p80766921710&a=530213544
Gold may bounce here, but watch the mining stocks. They are going to fall apart and underperform massively until gold hits its intermediate cycle low.
JAG, for one, is weekly oversold and has still not made a new low in the last two months. It is also up 6.5% vs gold since that ratio bottomed.
Daily:
http://stockcharts.com/h-sc/ui?s=JAG.TO%3AGLD&p=D&yr=1&mn=0&dy=13&id=p81966922030
I expect some of the individual stocks that have held up to catch up big time in the next couple of month. AXU I’m looking at you. Once it’s 100 WMA give way it’s probably headed to the .80 area. Short the crap out of it on any strength.
I’m anticipating a good drill program out of Alexco over the next 2-3 months so a few good holes with the high grade they keep finding could give AXU a nice pop.
It won’t matter when silver is $13 and headed to $9.
Good exploration results are more muted if the underlying commodity is in a downtrend, and more explosive if the underlying commodity is in an uptrend.
Either way, the market has be rewarding good drill results over the last year and punishing bad drill results, so exploration can still move the needle.
As for Silver prices I could see $13 if things got really ugly but not $9. $13-$14 Silver should have good support.
Silver to $13 and headed to $9? I love it when you get so bearish, Spanky!
It doesn’t show at stockcharts but the gold-silver ratio went to 84 yesterday. That’s what we should be looking at more than the dollar price of silver. $9 today is a lot less than $9 in 2008.
Here is what does show on stockcharts and it is interesting to see the Gold:Silver ratio getting so stretched again:
http://stockcharts.com/h-sc/ui?s=%24GOLD%3A%24SILVER&p=D&yr=2&mn=0&dy=0&id=p60983958493
Matthew – Agreed that JAG has been quite resilient, and is still greatly undervalued relative to other gold producing peers in the 100,000 ounces per year guidance.
When the gold market does turn up later in the year, it will be interesting to see if Jaguar gets rerated at least a little more on par with the other Jr-Mid-Tier Gold producers.
I have no doubt that it WILL get rerated.
Neither do I, but it is more a question of WHEN…..? 🙂
I’ll stick with what I’ve been saying since last year: the second half of this year. So it could start any time between now and early September.
We are in agreement there sir.
August Gold is struggling to hold above a 1217.50 Hidden Pivot support and would need to pop to at least 1248.30 in the next 3-5 days to get out of jeopardy. Failing that, we might expect the futures to continue down to at least 1194.40 in search of traction. That is the midpoint Hidden Pivot of the large corrective pattern shown, and it seems likely to provide a great bottom-fishing opportunity if and when it is touched. In the meantime, I’d suggest trading with a bearish bias, presumably by shorting minor abc rallies at D targets or p midpoints, or by using ‘camouflage’ set-ups to initiate such trades with-the-trend.
From Rick Ackerman
trades with the trend….thats all it is b…find your chart tool that has you long the majority of an upward trend and safely on the sidelines while the trend has lost its momentum as it obviously declines….thats all currency traders do as momentum chasers that never fail like deer in the headlights or as Chris mentioned exit a position and get short or wait again for your correct chart tool to confirm another long position..void of any opinion or ego
https://www.youtube.com/watch?v=8kRksX9sULg
Jim Rogers I found at sgt report
Hanst bought or sold gold in a long time, sitting in american dollars, waits for the correction.
If GG closes this month with a red monthly cande, that will be 6 down months in a row. That didn’t even happen during the bear market. That’s a bull market if ever I saw one–not.
Chartster is going to be accurate about his call for the metals but he might be a little soon for the bottom in mid August. We may get a counter move but it won’t last —as mentioned a couple of weeks ago I warned we might be seeing the start of an intermediate week cycle move with a left translated pattern —-it sure looks like it now. This move lower may even extend into September/October. There’s also a good possibility that the conventional market rolls over soon and both risk on and risk off get hit simultaneously. They could have a love fest together.
If by roll over you mean drop by 2-5%, sure. Stock market at worst will have one or two down weeks to get the momentum indicators headed downward and then the stock market will trend flat to higher while the momentum indicators continue to correct downwards. The stock market is bullet proof. The yen monthly chart looks extremely bullish to me in the next 6 months, which means massive tailwind for stocks.
$indu:$gold is now above the declining 200 month MA and is breaking out of a large cup and handle formation on the monthly chart.
It’s going to get even uglier for gold, and the opportunity cost of being out of US stocks is going to reach a crescendo in the next 6 months. After than who knows, but the monthly ratio chart looks bullish, with the 50 month MA crossing strongly over the 100 month MA and headed towards the 200 month MA.
It’s time for the gold bugs and commodity drones to face facts.
Good observation, spanky. The dow/gold ratio is very important and it better reverse or it could be a longer winter for the PM stocks then many think.
Is Silver Fairly Priced at $16?
Jason Hamlin -Gold Stock Bull
“The Dow is hitting all-time highs at about 21,500 and the official national debt – not counting unfunded liabilities – is about $20 trillion. Silver prices are too low compared to debt and the Dow.”
“Given the massive national debt, the Dow and NASDAQ exuberance, and 100 years of experience, silver could easily be double or triple its current price.”
The gold and silver miners are where the action will be, Spanky. Gold could be much higher versus the dollar before the Dow:Gold ratio begins to fall and that will be good enough to get the miners going to the upside well before the metal itself does anything impressive.
http://www.goldchartsrus.com/chartstemp/free/longtermdowgoldlogtr1800an.php
Agreed that the miners will lead the metals in action and performance when the uptrend begins and since that is what most of us are invested in, then I place much less importance on what the DOW:Gold ratio is.
Yes, the underlying commodity price is important, but only comparing the largest stocks to Gold can be a different path than how Gold is stacking up relative to Currencies or Bonds, and very different from the journey that select Jr miners are taking.
My point was that gold does not have to fall just because the Dow-gold ratio is rising. It could be that the next 10% rise in gold will happen while the Dow gains 15%. If so, the Dow-gold ratio would rise but not nearly as much as the gold miners.
All the miners really need is the belief that gold isn’t going substantially lower. It doesn’t need to rise nearly as much as some think for the miners to do very well.
Thanks for clarifying and that’s a solid point that Gold could hold steady or rise slower while the Dow rose more, and the miners would do just fine.
One thing to reflect on is that most miners have spent the last 5-6 years getting lean and mean, trimming the fat, reducing costs, improving operational efficiencies and metal recovery rates. This streamlining of the business and have set up a large portion of the quality miners so that they can still even do quite well at current prices.
Then if Gold/Silver gradually creep up and at least remain stable, then investors will have more confidence to get behind Explorers that hit pay-dirt, Developers with good economics, and Producers that are making steady progress and producing free cash flow.
If the metals moved gradually back up to $1300 Gold and $18-$20 Silver then that move would be enough to encourage most miners to continue forward based on the AISC numbers I see in most reports. Even numbers slightly below these figures would still provide most with reasonable margins. Anything over those levels would cause an explosive move up like we saw last year.
Exactly, Ex. Lots of gold miners are cash cows at current levels. The re-rating will happen if for no other reason than their valuations relative to most conventional stocks.
But first, we need gold to convince the market that it has little downside from here. A small move up to take back some long term moving averages would go a long way toward doing that.
Why in the hell would the Fed stop raising rates??? Commodities are headed deeper into the crapper and US stocks keep going higher and higher. It’s a perfect storm for stocks.
If the stock market falls, worst case the Fed starts easing again and they go back up.
The Fed has created the perfect moral hazard–the greatest the world has ever seen. You can’t lose in USD terms! and in real terms, you have absolutely *crushed* it over the last 8 years.
Monthly USD chart looks stellar. The 50 100 and 200 MMA are bulllishly aligned. It might be range bound until mid to late 2018, but it should explode once the 100 MMA crosses over the the 200 MMA.
I don’t think a lot of people realize this, but the miners are behaving bullishly relative to the metals today. GDX is down 1.77% right now while GLD is down 1.13%. The leverage offered by GDX should typically be about 3 to 1 and often much more if the trend (up or down) has much further to go.
SIL is down 1.95% while SLV is down a whopping 3.10%. That’s not a bad showing at all for the silver miners.
you’ve observed this many days over the last 6 months. So what?
Miners held their own during large portions of 2015 as gold and silver got hammered, but ultimately there was a massive shakeout at the end. We could have the same exact thing this time.
There is always a “kicker” thrown in with the miners after this type of pathetic performance over the last year. Like backing the steamroller up just to crush them even more, before TPTB go long. They always, always, go far lower than anyone dreams. Pick your most bearish forecast for $hui and then subtract 50 points-100 points.
And there have been many opportunities to buy low and sell high over the last 6 months.
Well that’s little consolation if you are in the buy and hold camp like me.
The monthly charts are still consolidating and haven’t broken down badly, yet, so there is that. But we can’t even hold mildly bullish thresholds like staying at or above the 20 MMA. I’m not asking for a rocket ride up. But some bullish (non-contrarian) signs would be great. I don’t think holding above the 20 MMA in a supposed bull market is asking much.
I hold a ton of shares in that category and am not worried about it at all.
I stated at the beginning of the year that I wasn’t as sure about the first half being good as I was the second half. There is still no reason to change that view, not yet.
The miners have actually held up better than expected today in the metals draw down. I was out shopping for deals on a number of miners on my watch-list and was surprised that many were up or only down mildly. Like you mentioned, you’d expect the miners to be down 3 times the metals but they are only down mildly more than the underlying metals.
That was the point Goldfinger was making that I’d posted up above:
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@Goldfinger – “$GDX has key support at $21, we’ve seen $gold ~$1200 and GDX ~$21 a couple of times this year already. All eyes on this descending triangle in GDX, but so far we’re seeing miners hold up relatively well compared to gold amid numerous bullish divergences. ”
http://cdn.ceo.ca/1clvd75-GDX_GLD_7.7.2017.png
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Jay FiFighter made a similar observation earlier today:
@Jayfire – “the miners are hanging in tough, i can’t even find anything really to buy… this is weird science”
Lead,Cobalt,tin, Zinc all have risen in price three weeks in a row.Soybeans also hit the 1000 mark again if only briefly.
Some commodities look bad but these look pretty good.
GCC has bsically had a waterfall decline on the daily chart. Of course there was bound to be a snapback rally at some point. Sideways to down from here.
You can’t hoot and holler yet after the absolute drubbing commodities have been in over the last year. Whoopy, commodities can actually go up for a week. It’s a miracle.
Sideways to down from here. GCC needs to gt above the 50 WMA. Isn’t going to happen.
Spanky:
Three weeks in a row is not the one week miracle you reference.
Now go buy your 15 shares of Amazon and tell us how smart you are.
Good luck with that.
Spanky – JohnK didn’t say all commodities. He was specific, and Zinc has been on an uptrend all year due to real supply destruction from a handful of the larger mines closing and growing smelter demand.
Here is a 1 year chart of Zinc for example:
http://markets.businessinsider.com/commodities/historical-prices/zinc-price/7.6.2016_7.7.2017
Here is the 1 year Lead Pricing Chart in a gradual uptrend:
http://www.infomine.com/investment/metal-prices/lead/1-year/
Here is the 1 year Manganese price chart:
http://www.infomine.com/investment/metal-prices/manganese/1-year/
Here is the Lithium Price trend. The chart looks a bit longer than 1 week: 😉
Tesla to build world’s largest Lithium-ion battery in Australia
In under 100 days or “it’s free.”
Cecilia Jamasmie | July 7, 2017
http://www.mining.com/tesla-build-worlds-largest-lithium-ion-battery-australia/
Lithium-rich countries risk missing the boat on electric batteries boom
Cecilia Jamasmie | about 17 hours ago #Charts
“As Tesla Motors begins to build the world’s largest lithium-ion battery in Australia and other vehicle makers such as Volvo get on board the electric vehicles train, concerns are rising over the environmental footprint of mining that and other materials used in car batteries, as well as their eventual disposal.”
“According to analysts at UBS, by 2025 the market will need 12 times the battery capacity currently available. At the same time, only 5% of lithium-ion batteries get recycled, versus more than 90% of those used in conventional vehicles, reports Financial Times:”
http://www.mining.com/charts-lithium-rich-countries-risk-missing-boat-electric-batteries-boom/
JohnK – I’m glad you posted that. Zinc miners have been a bright spot this year, and Zinc’s companion metal Lead has been doing almost as good.
This will also be a boon for many Silver companies. Americas Silver Corp is scaling back their high grade Silver stopes in favor of really ramping up their Zinc and Lead production to make hay while their Base Metal credits are shining.
Cobalt and the other Battery Tech metals like Manganese, Nickel, and Lithium have still held up fairly well.
Diversification has definitely helped my portfolio out time and time again.
The results from the Stock Picking contest over at ceo.ca have been interesting.
Recently I spoke with the gentleman compiling the stats and we discussed how the Zinc and Battery Tech stocks and a few Explorers with good drill results bucked trend.
The PM stocks and Uranium stocks had a nice rally coming out of 2016 into February, but have been on sideways to downward slide the rest of the year. I’m a bit more bullish than some on here and believe we’ll see a nice Autumn rally.
For those in panic mode today from one of the best in the business.
A superior buy-low strategy than waiting for the seasonal-tendency average lows to come to pass is to seize the opportunity on any significant gold-stock weakness in June or July. That’s certainly the case this week, where the gold stocks slumped back to the same major support zone between 180 to 185 per the HUI from where they bounced in both early March and early May. That ought to prove this summer’s low.
http://www.321gold.com/editorials/hamilton/hamilton070717.html
No one’s in panic mode, yet. Wait till gold drops below $1175, and the $hui heads to 140-150. Then you will see panic.
Ditto on panic mode…..
Bob M – thanks for sharing the Adam Hamilton article.
He does a good job of unpacking the Seasonal trends. No 2 years is exactly alike and history doesn’t repeat, but it often rhymes.
is = are
I want The Golden Goose,….not Mother Goose
ALERT: Andrew Maguire Just Exposed The Catalyst That Will Create Massive Gold Price Surge
King World News has completed the much-anticipated followup interview with whistleblower and London metals trader Andrew Maguire, and importantly, Maguire just exposed the historic catalyst that will create a massive gold price surge.
Andrew Maguire: “Eric, I fully anticipated some 250 tonnes of sovereign size orders to hit on that date (July 5th). The orders are still coming in very soon, and we all know there is no 250 tonnes of available gold to be delivered into the market at current prices. This is going to cause the inflection point that I discussed with you on the 9th of June. I want everybody to be aware that I am 100% certain that this (massive sovereign physical gold purchase) is coming. This actually relates to gold…KWN will be releasing this extremely important and timely Andrew Maguire audio interview as quickly as possible today. KWN will also be releasing one of the greatest audio interviews ever with Dr. Marc Faber that took place on a crystal clear line from Asia. You can listen to both audio interviews as soon as they are released…
“I Can Vouch for Andrew Maguire”: SIGNIFICANT Influx of Physical Gold Orders Imminent?
Silverdoctors…Turd interview
https://www.youtube.com/watch?v=7yRN7mqn2vU&feature=youtu.be
Here’s another one that’s not in the GCC. Zeolites. Zeolites are a major component of laundry soap and also gaining traction in the Mary Jane sector.
Very few people realize our dependency on China for Zeolites.
One to watch in the sector is ABR.V
Full disclosure, I don’t own any .
http://stockcharts.com/h-sc/ui?s=ABR.V
JohnK – I drink Zeolites as a cleansing agent and it helps removes toxins and even radiation from the body. It is growing in the health and wellness markets as well.
Hi Shad :Tell me more, which one do you recommend?
I take the Zeolite Pure powder and mix it in water from the site:
Its like drinking a glass of chalk water, but after trying a few brands I’ve settle on it.
Many tthanks JK
There is also Canadian Zeolite Corp. (CNZ.V)
Good call Shad.
I’ve been watching it for a little while, but don’t have a position. It is just so rare that Zeolites get discussed, that it seemed worth mentioning.
For clarity CNZ is a resource stock not a supplement.
Thanks for the Zeolite info, Ex and John. Not just the charts, but for the health benefit. 👍
Glad to share ideas Chartster. No point to wealth without health my friend.
Cheers!
KDX has filled its 6/6 gap:
http://stockcharts.com/h-sc/ui?s=KDX.TO&p=D&yr=1&mn=0&dy=13&id=p76658966669&a=530995360
I am itching to buy more KLDX and MUX and USAS and DRGDF down here. Just waiting for TB’s buy signal.
COT Report: Short Squeeze Coming – Jul. 7, 2017 4:42 PM ET
The COT report for this week shows a large short covering in the gold space and a continued short covering in silver from the large commercials. While the managed money shorts keep adding. This means we will see a high probability of a short squeeze soon.
On another note, Perth Mint sales are rebounding, while U.S. Mint sales are still languishing. SGE withdrawals in China were robust at 37 tonnes in June. India imported a record 1473 tonnes of silver in May, highest since 2009. Andrew Maguire is soon releasing his interview about the 250 tonnes physical buying, possibly coming from large institutions buying into the BullionCoin gold and silver backed cryptocurrency launch, which should push up the gold and silver price. Let’s see, then believe though…
https://seekingalpha.com/instablog/839735-katchum/5008942-cot-report-short-squeeze-coming?
MTF:
To see who is moving a commodity market you have to figure out which way the price is moving. If the price is moving up, it’s action by the shorts covering since they have to buy to cover.
If the price is declining it is the speculators covering their long positions since they have to sell to cover.
The author of that article has it totally reversed. All of the price action of the last week in silver was caused by the weak hand speculator longs bailing out and selling.
If you take PMs and oil out of the commodities complex, the commodities complex looks great. Oil (think petro dollar) and gold are attached to the currencies. Oil and gold are both at serious risk right now. So are junk bonds and the general markets.
The only safe havens that I can see are commodities and niche emerging markets.
Palladium has been on a tear as well.
Palladium longer term chart puts things into perspective on just how well it has done:
Silver plunged to significant support last night (at a thinly traded time) and acted well afterwards…
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=3&mn=9&dy=11&id=p09715118230&a=500464214
Good chart showing the Silver rebound off support.
I had posted this chart from The Hedgeless Horseman up above somewhere, but he made a good point about Silver coming down and filling that gap:
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@HHorseman – “We closed a major gap in #silver today:”
Gold has some fork support at 1200 next week…
http://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=5&mn=7&dy=22&id=p38007916759&a=495649167
The HUI found support at an important Fibonacci fan line this week (light grey)…
http://stockcharts.com/h-sc/ui?s=%24HUI&p=W&yr=1&mn=8&dy=1&id=p45205094017&a=533284650
I’m not taking a position on the Crypto versus Gold discussion as there are advantages and drawbacks to both forms of wealth storage, but this caught my eye and it seemed worth posting as I know some here follow the Crypto currencies rather closely and the potential implications of them pulling focus away from the PMs is interesting to consider.
___________________________________________________________________________
Top Wall Street strategist sees bitcoin ‘cannibalizing’ gold, worth as much as $55,000
Bitcoin has more than doubled in value this year and last traded near $2,540.
Widely followed strategist Tom Lee said in a report that his model shows bitcoin could rise to a range of $20,000 to $55,000 in the next five years.
{The report is a first from a major Wall Street strategist on the digital currency.}
Evelyn Cheng – 5 Hours Ago
Shad:
Everybody loves giving me guff for not selling my Bitcoin.
Thanks for the post.
I’ve made a lot of dumb calls,but Bitcoin wasn’t one of them.
Funny thing I was also thinking today that Bitcoin has been affecting Gold today.
Mark Douglas has a good book”The Disciplined Trader” He states that if your perception of the markets isn’t working you have to change your perception.
The market is never right or wrong,only you are.
Agreed about needing to change one’s perceptions and that the market is generally right (although I’d add at times it is inefficient and presents value arbitrages in valuations because of emotional traders actions, or the company strategy not being understood, or sometimes just a lack of promotion).
Yes, as far as Crypto currencies being a new form of Safe Haven, as controversial as that is, and while their are downsides to an Electronic Currency that could go bye bye in an EMP or hacking situation, there are still many advantages in ease of use and transfer, storage, and the ability to build up passive income through crypto mining.
I’ve been reviewing things like Ethereum and Ether, Ripple, Bitcoin, and the hundreds of other alt currencies and am still trying to get my head around all of it. While I’m much more interested in the PM miners, I’m not naive enough to dismiss the paradigm change that is taking place with the Millennials and many of the Emerging Markets as it relates to crypto and alt currencies.
It is a very interesting development that can’t really be ignored any longer, but I’m torn between it being a bubble that may pop soon or a completely disruptive technology that may be the way of the future. I find it interesting how polarizing the topic is with so many, but mostly just find the phenomenon fascinating.
Cheers.
I kinda took it to Mathew for missing the cryptos,but I will admit that I took the plunge on Bitcoin,I totally missed the rest of them. I still can remember discussing Ethereum at $7 and not acting.
I have a few friends that were banging on the Bitcoin and Ethereum drums and I never scoffed at them, but warned them to be cautious. When there was the large parabolic move up and then the crash, many of them lost money buying at the top of that first move, and I shook my head at the madness of crowds.
One guy kept all of his bitcoins and rode the recent wave up to all time highs, and I had to concede that he had made a great investment and that I had incorrectly dismissed its utility too soon. I then asked him to buy us a round of beers with all that bitcoin money. 🙂
Another observation is that many of my friends have Millennial children that have 0 interest in Gold/Silver/Platinum/Copper/Uranium or resources in general….
However, these younger adults are all intrigued by crypto-currencies because they live in an electronic world online. There does seem to be a new paradigm unfolding, and I do feel slightly like a dinosaur being invested in resource stocks.
One other observation is that, I notice that younger investors on ceo.ca like the battery tech (Lithium, Cobalt, Manganese) space, as well as the renewable energy sector, but haven’t transitioned over into heavily investing in these sectors. I’ve been encouraged by at least the interest from millennial investors in these emerging sectors, and work on staying abreast of what is going on.
I’m trying to stay nimble and keep and open mind to where the cheese is moving….
Great comments….change your perception…,
CNN’s Ratings Plummet, 1702
CNN got 1 star at the Apple Store
Andrew Maguire: Broadcast Interview – Available Now
http://kingworldnews.com/broadcast-interview-available-now-7-8-17/
A Tale of Two Gold Markets – James Rickards
In the early morning hours of Monday, June 26, gold fell about 1%, from $1,254 per ounce to $1,242 per ounce, in a matter of seconds.
And that the equivalent of 1.8 million ounces of gold were sold at once. The 1.8 million ounce amount is equivalent to about 59 metric tons of gold. That’s about 2% of the entire gold mining production of the world for a full year. No one sells that amount of physical gold.
I still think the Japanese are the ones in the PGM Futures.
Check out the move in the JGB10YR coinciding with the plunge in PGM’s today.
I ‘ve posted this before
https://www.bloomberg.com/quote/GJGB10:IND
JohnK – I do believe the Yen and Japanese bond markets can move the metals space, but hadn’t spent much time on the connection to the PGMs in specific. That will be something to keep an eye on and I appreciate your comments.
THERE IS NO SUCH THING AS A BAD TICK
by Kevin Muir — on silver , gold , Yen , Japan 07 Jul 2017
“And the following explanation might move me into the tinfoil hat crowd, but I have watched the strong relationship between the Yen and precious metals for too long to believe it is a coincidence. Somehow, and I am not sure of the exact details, the Japanese government is using precious metals as part of their monetary policy. Now they might be doing it through the Postal Service Pension plan (GPIF) – after all, they have openly admitted to the BoJ buying JGBs from the plan, and the postal service pension investing in foreign stocks with the proceeds. There might be some sort of similar arrangement with precious metals. Who knows? I certainly don’t, but I just don’t believe this tight relationship can be explained by chance:”
“I also think that government officials are the only ones price insensitive enough that they are willing to transact monstrous size at 6pm.”
“But here is the kicker as to why I believe this order somehow emanates out of Tokyo. The 6pm silver flash crash coincided with the opening of the Japanese bond market.”
“That in of itself is not that insightful. But yesterday with the global rout in bonds pressuring JGBs, the 10 year bond bumped up against the BoJ’s 0.10% ceiling. Don’t forget, whereas most Central Banks engage in quantitative easing where they commit to buying a certain amount of bonds at any price, the BoJ has moved to pegging the long end of the yield curve. This means they have to theoretically buy an unlimited amount of bonds at that rate to ensure that part of the curve does not go any higher.”
“And sure enough, last night the BoJ wandered into the bond market and said, “11 basis points bid for whatever you want to do.”
“This obviously sent the Yen lower, after all, this transaction increases the supply of Yen, so it is extremely Yen bearish. But more importantly, it was at this point that silver shit the bed.”
“Now maybe this is just one of the consequences of this elaborate financially intertwined science experiment of a new global economy. Maybe there was no silver order from Tokyo. Maybe it was just a domino effect.”
“But I somehow doubt it. Someone still needed to sell 6 thousand contracts. And not only that, they needed to sell them in the stupidest way. And when I am looking for culprits for stupid, Japanese government officials seem like the most likely candidates.”
“However, putting away my cockamamie theories, I want to point out one important indisputable fact. The BoJ has committed to pegging their 10 year rate to 0%. If the global bond bear market gathers speed to the downside (higher yields), then the Japanese will increasingly find themselves having to defend this peg. As they defend it, this will increase the money supply, which will ultimately be inflationary. That might force more JGB holders to sell, creating a self reinforcing vicious circle. The Japanese have relinquished control of their money supply. If credit is demanded, they are forced to provide it in unlimited quantities.”
http://themacrotourist.com/macro/there-is-no-such-thing-as-a-bad-tick
Good thought. Japan is caught in a cycle of stupid.
SMI (22/06/17) : Juerg Kiener – Keynote Speaker
Swiss Mining Institute – VIDEO presentation
https://www.youtube.com/watch?v=QhWJFtuq8cU