Jordan Roy-Byrne – Will Gold Move Higher On Fed Rate Hikes If We Don’t See A Corrective Move First?
Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to outline why gold may not have the rally many are expecting if we don’t see a correction lower first heading into the Fed rate hiking cycle. We discuss 3 potential paths forward for the precious metals based on whether 1) gold has one more capitulative move down prior to the rate hikes, versus 2) gold continuing to channel sideways into the rate hikes, or if 3) gold could sustain and upwards trajectory and break out higher in the event inflation readings keep coming in hotter than anticipated.
Jordan reaffirms that his expectations are that inflation has mostly peaked here, so the continuation move higher in gold seems like the least likely option, but we do dig in a bit more to the scenario where if gold trends sideways into the hikes that it will likely bottom after a few hikes and then turn higher when the market starts to anticipate in advance that the Fed will be pressured to stop the rate hike cycle and reverse course. The most ideal scenario is still corrective move leading into this central bank policy change.
We wrap up with thoughts on how watching the yield curve and action in bonds will be instructive for just how much wiggle room the Fed has, but note the risks they face by starting so far behind the curve and with inflation already have run so far beyond their initial expectations.
Click here to visit The Daily Gold website and keep up to date on Jordan’s technical outlook.
Stocks should be able to at least levitate for awhile and possibly more than that.
https://stockcharts.com/h-sc/ui?s=IWM&p=W&yr=5&mn=0&dy=0&id=p79423054621&a=726196210
SPY is bullish vs GLD, at least short term.
https://stockcharts.com/h-sc/ui?s=SPY%3AGLD&p=D&yr=0&mn=7&dy=11&id=p64587762698
However, I doubt that the weekly picture will return to net bullishness soon.
https://stockcharts.com/h-sc/ui?s=SPY%3AGLD&p=W&yr=6&mn=5&dy=0&id=p73380284200&a=1015547995
January CPI Preview: Inflation Likely To Reach Fresh 39-Year High
Emily McCormick – Wed, February 9, 2022
“U.S. inflation likely accelerated in January, with prices across a wide range of goods and services soaring further amid lingering shortages and supply chain disruptions.”
“The Consumer Price Index (CPI) released by the Bureau of Labor Statistics Thursday morning is expected to register a 7.2% annual gain in January, according to Bloomberg consensus data. This would represent the fastest rise since 1982, as well as an acceleration from the 7.0% year-over-year increase seen in December. ”
https://finance.yahoo.com/news/consumer-price-index-cpi-inflation-january-2022-210344769.html
Jesse has relevent charts for the disconnect effect……………….keeping in mind that the fed just “stopping the shovelling” out the new money is a big break pad on the economy that has been so addicted to low rates and huge monetary inflation buy the fed………………supply chains IMO will take years to resolve not months, as stated by Jim Richards, so sticky high inflation setting the stage for stagflation……………. might be in the cards already……………..the fed may chose the inflation fight to get it under 4 % and somewhat throw the general economy under the bus for now…………….a we are still close to full employment……………high inflation just robs too many on mainstreet and below…………………but I can see Jordon’s take on the cap at maybe 2 to 3 hikes and a wait and see approach…………………Heck even the Euro sees an uptick in inflation……….even a heart beat there is welcome by the central bank I’ll say it again………………Central banks got what they wished for…………………….this orchestrated Ukraine drama designed to keep energy prices lofty…………will ensure the inflation card stays in play for some time to come…………….Debt to GDP has to been brought in line at any cost……………Joe ordinary will pay the price like always……………….gold and silver charts rule the day……………and when people had enough of the inflation games played by the banks…………..the charts will throw their tantrum to the upside…………until anything starts trading above it’s 18 day moving average, I’m with Doc, sit on hands, and wait…………..bottom picking can be a fools game, wasting too much time and energy !
Good thoughts Larry C on inflation, stagflation, and Fed policy. The next year is going to be fascinating to watch unfold.
Gold has taken back its 377 day MA for back-to-back closes…
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=2&mn=3&dy=0&id=p72906985245&a=902656161
GLD needs to close about 0.5% higher tomorrow to break out.
https://stockcharts.com/h-sc/ui?s=GLD&p=D&yr=1&mn=3&dy=0&id=p33315795937&a=1110857253
Gold itself appears to have already done so.
Tomorrow’s action will be important and the odds greatly favor the bulls.
https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=3&dy=0&id=p67496786773&a=1110860023
Rick Rule’s Top 3 Criteria for Finding 10-Baggers
The Daily Gold w/ Jordan Roy-Byrne – February 07, 2022
https://thedailygold.com/rick-rules-top-3-criteria-for-finding-10-baggers/
Rick Rule mentions finding a management team with a strong track record. He talks about people he knew in the past that helped him build his wealth but what about now. Who currently are the superstars in the mining business, Quinton Hennigh, Shawn Ryan, maybe Simon Ridgeway and Fipke ( but the latter two are getting on) comes to mind, but I think these days it is more about the financial companies that will back the future ten baggers, like Crescat Capital, and Alumina Capital. Finance companies that hire geologists with a track record to work with them. The mining business is now far more complex in every way and they will dominate the industry particularly in the exploration stage. DT
Agreed DT on the power of solid capital groups to source teams, projects, financing, and marketing agreements.
In addition to Crescat that you mentioned, I had posted an article I wrote last year about some of the other solid capital groups like Oxygen Capital Corp, Inventa Capital Corp, Discovery group, Metallic Group, Featherstone Capital, and Lumina Group as other examples.
DT – here is that article referenced above that gets into the different Capital Groups:
Backing Quality Management Teams Through Backing Quality Capital Groups
Thanks for the refresher Ex, I must earmark that post so I can see what is going on with those Capital Groups you mentioned! Good Point! DT
ok Matthew…very interesting …thank you
Larry, everything looks near perfect to me. Aside from the fence-sitters, we got a ton of bears and they are very confident which makes the setup better still. They’ve got their neat plans to raise cash and/or even short the sector which is funny since none made mention of shorting months ago when the picture most warranted it. With that said, a bad day for gold tomorrow would be a timely win for the bears that could amount to something.
Look at a 10 year chart of the SOXX vs any silver miner.
Most notably, the fact that the silver miners are now substantially underperforming the SOXX since the 2020 Covid-crash is shocking.
The HUI stalled at fork resistance but I bet it will get through it very soon (probably tomorrow).
https://stockcharts.com/h-sc/ui?s=%24HUI&p=D&yr=1&mn=4&dy=0&id=p47211910101&a=1105555109
It’s funny how many people would rather buy $18 SILJ than sub $11 SILJ. Just look at the volume around last year’s high versus this year’s low. Not to mention the sentiment then versus today…
https://stockcharts.com/h-sc/ui?s=SILJ&p=W&yr=6&mn=3&dy=0&id=p72035396388&a=724116257
Hi : my own gold stocks are slowly moving up . my food stocks still outpreform gold and silver stocks . See mitch mc is strongly breaking with Trumpet mouth , as his statements are seriously damiging GOP in coming elections . Cant run candidates who only do trump revenge talking points. Trump has no intellect — or no new ideas . Holly or DeSantis will probably run with a trump endorsment . My prediction is that Trump trades his endorsment inexchange for an appointed office like Ambassador to Brazil or some other country . Its true Trump would need Senate approval to be an ambassador BUT a temporary [90 day] can be had without Senate approval , and done repeatedly so in effect a pres can still get a ambsador just not a perminant one . Trump has violated the federal doucumants act by the way if you did it you would be endidted rsh
Russell Hamilton – Just putting 2 lines about economic ideas as a thinly veiled attempt to then pontificate with Trump derangement syndrome is a post that really is better-suited for the politics board.
Please put posts like this on the political threads moving forward, as we’ve had this same issue with your posts multiple times now. Posts this politically devisive are going to encourage political counter responses from other users, and we don’t want all that on the economic blogs. That is why we have political blogs every day. Thanks in advance for your understanding and moving these kinds of posts to their more appropriate place on this site.
Right, this board is humming along nicely and Russell’s post would be more welcomed elsewhere.
Russell, I hope you’re getting your boosters.
DITTO…………. lol……….. go for it Russell……….. I can not remember when you were ever correct….. lol
USD vs Gold broken support:
https://stockcharts.com/h-sc/ui?s=%24USD%3A%24GOLD&p=W&yr=6&mn=3&dy=0&id=p31351113060&a=1108461951
Silver took back its 500 day (roughly 2 year) MA today.
https://stockcharts.com/h-sc/ui?s=%24SILVER&p=D&yr=1&mn=5&dy=0&id=p96021394706&a=1111101569
Silver Markets Continue to Grind Higher
Christopher Lewis – FX Empire – Tue, February 8, 2022
“Given enough time, silver does look like it is going to try to break out and fill the gap above which starts at the $23.58 level. A breach of that could have the market going to the 200 day EMA rather quickly, but I think it is going to take a certain amount of US dollar weakness to make that happen as the negative correlation between silver and the dollar is so strong.”
https://www.yahoo.com/finance/news/silver-markets-continue-grind-higher-165325229.html
Precious Metals Royalty Conference
Bloor Street Capital – 02/09/2022
Franco – Wheaton – Triple Flag – Sandstorm – Maverix – Nomad
SILJ vs SOX is up about 16% since its December low. It was up as much as 36% last month.
https://stockcharts.com/h-sc/ui?s=SILJ%3A%24SOX&p=D&yr=1&mn=3&dy=0&id=p80989744262&a=1111133966
Worst inflation since 1982 … might as well forget the lipstick on this pig.
(AXU) Alexco Resource: Bermingham Additions Boost Global Resources
Feb. 09, 2022 – Taylor Dart – Seeking Alpha
– Alexco Resource released an updated mineral resource estimate at Bermingham last month, reporting a 42% increase in indicated tonnes, and a 66% increase in inferred tonnes.
– Notably, this increase in mineral inventory was coupled with a slight increase in silver grades, with indicated and inferred silver grades increasing 1% and 3%, respectively.
https://seekingalpha.com/article/4485554-alexco-resource-bermingham-additions-boost-global-resources
(AXU) Alexco Resource Is Starting To Look Cheap And I’m Bullish Now
Feb. 10, 2022 – Gold Panda – Seeking Alpha
– “The company released an updated mineral resource estimate for the Bermingham deposit, which boosted its resources by 22.4 million ounces of silver.
– Alexco is ramping up production and I expect quarterly revenues to more than double by the middle of 2022.
– The balance sheet has been strengthened and the company should have around $25 million in cash.
– Overall, I think that Alexco looks cheap at the moment, and that share price levels below $1.80 provide a decent buying opportunity.”
https://seekingalpha.com/article/4485779-alexco-axu-cheap-bullish-now
(SVM) Silvercorp Metals Continues To Deliver And Looks Undervalued
Feb. 03, 2022 – Gold Panda – Seeking Alpha
– “The company is on track to deliver the highest production in its history and is also building a new 3,000 tonnes per day mill at Ying Mining District.
– AISC is down to just $7.35 per ounce of silver as of Q2 FY22 while cash reserves have surpassed $140 million.
– Yet, the market valuation of Silvercorp Metals has declined by almost 40% since June and the likely reason is low silver prices.
– I think Silvercorp Metals should be worth at least $800 million at today’s silver prices.”
https://seekingalpha.com/article/4483837-silvercorp-metals-continues-to-deliver-look-undervalued
Holy Smokes! Cannabis Is Lookin’ Good!
By Sean Brodrick – Wealth Wave – February 10, 2022
https://weissratings.com/en/wealth-wave/holy-smokes-cannabis-is-lookin-good
“Holy Smokes”. Really…..
Sold some short term puts on MSOS, got assigned the stock, sold short term calls, then sold it yesterday. Made some decent money. Watching MSOS, do the same over again. It’s an okay way to employ some cash, make some money, be proactive instead of watching stocks go up and down.
(ITR) (ITRG) Integra Completes Pre-Feasibility Study for Delamar Project With Average Annual Production of 163,000 Oz Au Eq for the First 8 Yrs, and Demonstrates Project Optionality With Phased Development Approach
– 9 Feb 2022
https://ceo.ca/@nasdaq/integra-completes-pre-feasibility-study-for-delamar
the dxy dollar reversal and inflation scare should have gold rocking rather than crawling it’s way possiblly to january highs. The gold producers especially bellweathers like aem nem are negative and need a reversal to cheer the bulls up.
All in all more of the same, let’s see what the end o day/week brings.
Coventional markets keeping hopes alive.
Good move in Nobel Resources. Still early play and speculative.
Theralase continuing its slow walk up before news…
Nice call DOC with BNGO
This is a TSX Venture vs Gold chart, It may be signaling a stealth breakout IMHO. I am very bullish the PMs as the monetary side of silver has been ignored too long and is due for excitement sometime this year, maybe even a few times.
https://www.tradingview.com/chart/JX/KslfMwz7-TSX-Venture-proxy-for-junior-miners-vs-Gold/
Just a heads up Ex for trading the Wolfster is bitching portfolio….I’m starting to vent a little on ceo about black wolf….
Also totally forgot that QH has referenced Blackwolfs niblack property in the past year and mentioned how impressed he was and what potential it has. Just saying. 😏
Well, as I mentioned yesterday, a drop today “would be a timely win for the bears that could amount to something.”
It’s too soon to tell and there’s still plenty of reason for bullish optimism but today was not ideal.
GLD confirmed the resistance line that I shared yesterday when it reversed there this morning:
https://stockcharts.com/h-sc/ui?s=GLD&p=D&yr=1&mn=3&dy=18&id=p12816839911&a=1110857253
Here’s another look which is still clearly net bullish:
https://stockcharts.com/h-sc/ui?s=GLD&p=D&yr=1&mn=8&dy=18&id=p90620819832&a=973504878
This one is very interesting. GLD’s reversal today also happened at the anchored VWAP based on the 2020 high. In other words, it turned down at the volume-weighted average price of all trading since the top 18 months ago.
https://schrts.co/CQJZNhuY
For comparison, that anchored VWAP for GDX is over 12% above today’s close.
https://schrts.co/JueYnGPQ
Gold did manage to close above the anchored VWAP that GLD bounced off of (because the two trade different hours)…
https://schrts.co/gURJTbsP
Silver finished above 61.8% Fibonacci fan resistance and gave a new MACD buy signal. Let’s see if it can rise for the 6th day in a row.
https://stockcharts.com/h-sc/ui?s=%24SILVER&p=D&yr=1&mn=5&dy=0&id=p70147037473&a=937970450
Can The Fed Afford To Tighten Into An Economic Slowdown?
.
Jesse Felder – The Felder Report – (02/09/2022)
.
https://thefelderreport.com/2022/02/09/can-the-fed-afford-to-tighten-into-an-economic-slowdown/