Chris Temple from The National Investor – Fri 17 May, 2019

Metals getting hit but it’s a story of gold vs other metals

Chris Temple joins me to outline the moves today starting with the metals markets. A broad selloff in the metals but as Chris points out it’s more a story of gold vs other metals. All the other metals are moving down in response to continued global weakness but gold is another story. We also touch on the move higher in the USD which is setting up for another higher weekly close.

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  1. On May 17, 2019 at 9:49 am,
    spanky says:

    Looks like 2013 to me.

    Look at SIL. 2016 will go down as one of the greatest sucker’s rallies in history. It has been sold down so hard this last few weeks, follow through for many more weeks and likely months is virtually guaranteed at this point. Yes, it could bounce and try to touch the 20 WMA at any time, but make no mistake it will be a shorting opportunity. It’s been a short sellers DREAM for 7.5 of the last 8 years.

    • On May 17, 2019 at 10:22 am,
      OOTB Jerry says:

      silver……….A real eye opener for the suckers……

    • On May 17, 2019 at 10:57 am,
      gator says:

      Metals have been in the tank for years and will continue there for many more.

      • On May 17, 2019 at 11:08 am,
        OOTB Jerry says:

        Well, …….Welcome BACK …….GATOR…………
        How have you been, glad to hear from you……

        • On May 17, 2019 at 11:10 am,
          OOTB Jerry says:

          Slope of hope, is like a slippery bank on the St. Johns……….. 🙂

        • On May 17, 2019 at 9:05 pm,
          Gator says:

          Hello Jerry….I found out there is something other than the market to occupy my time. I,ve been building cedar glider chairs for the animal rescue groups to auction off to help fund the food and shelter needs. I trust you and yours are well…Good talking with you.

          • On May 18, 2019 at 5:11 am,
            OOTB Jerry says:

            That is a noble cause…….I am glad you have found something that is worthwhile to contribute ……Drop in from time to time, I appreciate hearing from you….Take care.

  2. On May 17, 2019 at 10:00 am,
    spanky says:

    GDX is currently printing a black weekly candle. 100% it will close lower next week or after a weak bounce.

    If gold takes out the 1267 pivot, it’s in no-man’s land as far as I am concerned. It might reverese next week, or this could be a 2013 replay. I really could not guess at this point. Barring a miraculous reversal in GDX and/or GLD at the close, I will assume things get much worse in the days, weeks and likely months ahead. And yes, of course, we could get a deadcat bounce soon. Who cares.

  3. On May 17, 2019 at 10:07 am,
    spanky says:

    UUP looks primed for a sustained moonshot.

    Why? I have no idea. Maybe when they reinstate QE it will go even higher.
    All you need to know is that it is a day away from breaking out and heading to Uranus, despite Jerome ending rates hikes and QT months ago. You can’t win folks. You won’t be allowed to.

  4. On May 17, 2019 at 10:11 am,
    spanky says:

    Keep in mind that the CoTs indicate that gold has PLENTY of room for much, much lower prices.

    The CoT report will be released at the close and I guarantee it will be extremely bearish. It will probably show a solid two months of potential selling still ahead of us.

  5. On May 17, 2019 at 10:25 am,
    one of the peters says:

    “Honey Nut Cherios to Axle Nut Grease ratio”?


  6. On May 17, 2019 at 10:36 am,
    OOTB Jerry says:

    The cabal……..does not want you to win………
    Keep everyone on the oil budget..

  7. On May 17, 2019 at 10:42 am,
    OOTB Jerry says:

    WASHINGTON (AP) — Democrats in the House approved sweeping anti-discrimination legislation Friday that would extend civil rights protections to LGBT people by prohibiting discrimination based on sexual orientation or gender identity. The protections would extend to employment, housing, loan applications, education, public accommodations and other areas.

    Called the Equality Act, the bill is a top priority of House Speaker Nancy Pelosi, who said it will bring the nation “closer to equal liberty and justice for all.”

    Sexual orientation and gender identity “deserve full civil rights protections – in the workplace and in every place, education, housing, credit, jury service, public accommodations,” Pelosi said.

    The vote was 236-173.

    The legislation’s chief sponsor, Rep. David Cicilline, D-R.I., said it affirms fairness and equality as core American values “and ensures members of the LGBTQ community can live their lives free from the fear of legal discrimination of any kind.”

  8. On May 17, 2019 at 10:43 am,
    OOTB Jerry says:

    “closer to equal liberty and justice for all.”……..Nothing wrong with that, as long as I am not effected……or infected…..

  9. On May 17, 2019 at 10:46 am,
    spanky says:

    I respectfully strongly disagree with Chris here. The only way Jerome Powell eases is if the US stock market tanks. He doesn’t care about too low inflation or foreign currencies. If anything, falling commodities are a windfall for US companies.

    The Dow and S&P are within spitting distance of new all time highs. Jerome ain’t budging until he sees some distress in US markets. Until then, its all gravy (tanking commodities and a rising USD).

  10. On May 17, 2019 at 10:55 am,
    spanky says:

    Some of the miners are printing positive daily candles so far today. While that is a positive, by no means would I be placing long bets based on 1 day’s action. Also, things could easily change by the close.

    The mining to metal ratios have been pounded, in many cases further than the miners themselves, so you will get outperformance from time to time.

    I said silver had a 3-5 day window where it can drop, but it has to reverse, and reverse hard at the end of the selling. We will only know in hindsight.

  11. On May 17, 2019 at 11:14 am,
    Silverdollar says:

    I’ll take whatever positive comments I can find on gold. There’s not a lot of good comment out there. l appreciate Chris’ thoughts on the subject. These are tough days for anyone who believes gold has merit in one’s portfolio. The real problem is that the herd is looking elsewhere………..
    All the conflicting headlines continue to show that nobody knows anything. From MarketWatch: “Millions are one paycheck away from financial disaster.” From Zero Hedge: “U. Michigan Sentiment Soars as Hope explodes to 15 year high.” Gartman sold short this morning. Market therefore will continue higher! JMO

    • On May 17, 2019 at 11:32 am,
      Matthew says:

      Objectively good news about gold is that it remains above important weekly moving averages:

      • On May 17, 2019 at 11:46 am,
        Silverdollar says:

        Thanks. I used to be able to access your chart postings. Last couple months doesn’t work with my computer. Perhaps old software. However I note that the Stockcharts URL is different. European?

      • On May 17, 2019 at 11:54 am,
        spanky says:

        For now. It’s also above weekly cloud support too.

        Still, what worries the most is cycles analysis and the COTs.

        And at least on GLD, it looks like the 50 WMA will negatively cross the 200 WMA for the first time in years.

        I know rationally why gold should be shining now, but none of it matters, and hasn’t mattered for 8 years. The 2016 rally just reset sentiment, and we are just drifting sideways to down, just like 1980 -1998. Afterall, the sharp rallies are charactersitic of bear market rallies, and we got the mother in 2016. Also, GSR just broke out and it looks like curtains for silver. There really is absolutely no rational basis for thinking silver won’t be making a new multiyear low soon. If there is, I would love to hear it.

        I genuinely hope I am wrong. But right now things ain’t looking too hot. The similarities to 2013 are pretty striking IMO.

        The cruelest result will be to see the stock market vaulting to new all time highs as silver makes its new multiyear low, with gold on its way.

        If GDX closes below 20.63 today, and let’s be real, it most probably will, I would expect next week to be very painful.

        • On May 17, 2019 at 11:57 am,
          Matthew says:

          I do think gold will dip lower next week.

          • On May 17, 2019 at 11:58 am,
            Matthew says:

            I’m guessing that the 1260 area will hold.

          • On May 17, 2019 at 12:03 pm,
            spanky says:

            I think once that $1267 pivot goes, you can mostly likely kiss gold goodbye. If they manage to close it below cloud support next week, it’s possible it won’t get back over $1270 again.

            I base this possible bearish outcome mostly on cycles. We will either have an extremely stretched intermediate cycle (very low probability IMO), or we are in the midst of a severe left translated cycle, with likely weeks to months of downside left.

          • On May 17, 2019 at 12:08 pm,
            Matthew says:

            I think the MAs are much more important than that cloud support.

          • On May 17, 2019 at 12:18 pm,
            spanky says:

            You could have said the same exact thing in January 2013. That didn’t work out too well.

            Plus, as I stated, GLD’s 50 WMA looks like it will negatively cross the 200 WMA imminently. That’s probably gold’s first target if/when 1267 gives way.

          • On May 17, 2019 at 12:24 pm,
            Matthew says:

            That’s beyond ridiculous. Compare the 2013 picture to today’s:

          • On May 17, 2019 at 12:44 pm,
            spanky says:

            From a cycles perspective, $gold’s picture is very similar. People were equally confused back then.

            And GDX’s current weekly chart is very similar to 2012-2013 in terms of the interplay with the 50 and 200 WMAs.

          • On May 17, 2019 at 12:49 pm,
            Matthew says:

            Re GDX, the monthly MACD is very different as is the weekly cloud (note the green that was absent in early ’13):

  12. On May 17, 2019 at 11:51 am,
    larry says:

    GDX is up in price on the worst volume of the year in a down gold markeyt…count me out of that chit

    • On May 17, 2019 at 11:55 am,
      Matthew says:

      It also looks like it is going to close below its 50 week MA for the third straight week.

    • On May 17, 2019 at 11:57 am,
      spanky says:

      If it closes below 20.63, I think it is setting up the possibility for a large gap down on Monday. Gold looks like it will gap down too on Monday if it closes near the lows, which since the NYMEX is now closed, it probably will.

  13. On May 17, 2019 at 12:22 pm,
    Markedtofuture says:
  14. On May 17, 2019 at 12:22 pm,
    Matthew says:

    Frank Holmes nails it re bitcoin: “We have a problem with ignorant millennials.”

  15. On May 17, 2019 at 12:23 pm,
    spanky says:

    The technical structure of gold and the HUI in 2013 is strikingly similar to the current picture, especially on the weekly charts.

    • On May 17, 2019 at 12:26 pm,
      Matthew says:

      I strongly disagree.

      • On May 17, 2019 at 12:32 pm,
        Matthew says:

        Example: Gold and its 50 week MA were at twice the value of gold’s 600 week MA in January 2013 while gold just 1% above it today and the 50 week MA is below it.

      • On May 17, 2019 at 12:34 pm,
        spanky says:

        Take a look at GDX’s weekly chart with the 200 and 50 WMAs. It looks very similar, especially with GDX failing to retake the 50 WMA after the deathcross. That sucker’s pop we got in September 2012 looks an awful lot like the pop we got into February this year.

        I would be shocked if this plays out the same, but it is what it is and right now, the analogy is apt, IMO.

        • On May 17, 2019 at 12:52 pm,
          Matthew says:

          GDX isn’t going to have another 2013 type plunge unless gold does and gold looks fine now when compared to then.

      • On May 17, 2019 at 12:48 pm,
        spanky says:

        I’ll admit that if GDX closes up over the 50 WMA, it will be a good sign that things will play out differently, but I still won’t believe the nightmare is over until we close solidly over the 200 WMA for several weeks.

  16. On May 17, 2019 at 12:58 pm,
    spanky says:

    Looks like GDX is going to close positive and likely over the 50 WMA. That’s definitely a positive, but it is by no means out of the woods yet.

    Let’s pray silver reverses hard next week.

  17. On May 17, 2019 at 1:03 pm,
    spanky says:

    So arguably you have an inverted hammer on the GDX weekly chart last week, and a positive doji candle this week that made a higher high than last week and closed slightly over the 50 WMA (by a couple cents). That’s constructive. Better than making new lows and being down 5% I guess. hahaha

  18. On May 17, 2019 at 1:54 pm,
    spanky says:

    You’ve also got bull hammers across a lot of silver names today, formed at the very bottom of their ranges. We really have no business going below today’s lows in names like SILJ and EXK until they at least tag their 20 DMAs.

  19. On May 17, 2019 at 2:07 pm,
    spanky says:

    Just as I suspected, gold shorts exploded higher this week. they are not that far off from the peak in commercial shorts reached at gold’s recent top in February.

    Silver OTOH looks way better, and the large specs are actually net short now. However, as we have seen, silver’s CoT picture has recently needed to get to extremes before a bottom was struck and can malinger down in the depths for weeks before a turn. That’s what happened at last year’s low. The large specs were actually net short for 5-6 months (between July and Nov. 2018!).

    The pessimist in me would say that gold is likely going to be sold hard for a few more weeks potentially (even accounting for this week’s pummeling), as silver’s CoTs build to a bullish extreme (and silver price goes even lower too).

  20. On May 17, 2019 at 2:19 pm,
    spanky says:

    Perfect looking bullish engulfing candle printed on DBA this week. If agriculture hasn’t struck a final low this week, I’ll eat my hat.

  21. On May 17, 2019 at 5:17 pm,
    Ozibatla says:

    I hate to jump on the bear bandwagon here but in the sake of calling a spade a spade, the metals look sh*thouse (to borrow a common Aussie term). It is what it is and I have been waiting for this. Until the common stock market landscape changes along with the global economy, then the status quo remains.

    I suppose one positive is that bearish sentiment seems so prevalent, a contrarian perspective could indicate a bounce soon? However that maybe all it equates to – A bounce!

    It would seem likely that the Dow and S&P could reach new highs in the interim, thus keeping any meaningful interest out of alternative markets.

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