Marc Chandler – Recession Fears Recede As Inflation Concerns Take Center Stage Next Week
Marc Chandler, Managing Partner of Bannockburn Global Forex and Editor of the Marc To Market website, joins us for a discussion on the macroeconomic factors moving the markets. We kick off the discussion with a recap of the Non Farms Payroll jobs report coming in higher than expected and how this may stave off some of the recession worries in the near-term. This data is counterbalanced with the caveat that US jobless claims numbers have been steadily rising since March of this year, as much as 40% off the lows, which is showing a bifurcating picture of the health of the labor markets. Even when considering this though it would need a 50% reading or higher and another data point, the Sahm Rule which is a recession indicator, is still flat. Marc feels that even if the Atlanta Fed’s GDP Now readings are correct showing 2 quarters in a row of negative GDP growth, that the labor markets are where the Fed will be watching for clues.
Next week things shift over to the markets focusing on inflation readings through the CPI and PPI readings, where many are expecting persistently high headline inflation and yet a continued lower trend in core inflation. We discuss potential scenarios if the numbers come in hot or cold, and what that could mean with regards to the Fed rate hikes and tightening cycle. We wrap up with some thoughts on the strong US Dollar in relation to other key currencies that have weakened in relation, and a look a the health of the general equities markets.
The labor market job report justifies the ongoing increase in interest rate hikes and will continue to support the dollar with gold, silver and commodities under pressure. Goldmine Slacks is a joke when they called for higher gold prices (2200-2500) by year’s end—-I would give odds to that happening. We’ll now test the lower BB of the monthly gold chart which I’ve been mentioning for months and then we’ll have to make a prediction of the next movement in gold based on what the technical crystal ball is telling us. Actually for the first time in days, I did some “nibbling” yesterday—there is absolutely no hurry in buying whether it’s the PMs or the conventional markets. For those that think the conventional market rout is over; go ahead and buy like there is no tomorrow and get your head on a plate handed to you later.
Some good points for investors to consider Doc. My big nibble day in the PMs was on Wednesday, although I did quite a bit on Tuesday, last Thursday, and a wee bit today.
As for the general markets, I concur that it’s way too early for folks to be piling back in, unless it’s just to trade the remaining part of the dead cat bounce. We still have further to fall in us equity markets as the bear is just getting hungry after waking up from hibernation the 4th quarter of 2021. If we get just a little bit more upside juice in the general markets, I may join you in shorting them again.
Ex, Calibre just broke its’ 200 week MA and I’m getting interested in taking an initial position in the near future—-I take it there has been no change in your position related to it.
I added little to Calibre this week Doc. It’s currently my largest gold stock holding.
I added Calibre on July 1 and Cabral on July 8. I started violating my 10,000 shs on first buy rule as I don’t have enough money to go to all the good buys there are. Less than 10,000 buy-backs have been Summa, Blackrock Silver, Chargepoint holdings, Vizsla and Amex. Probably will add Eloro with lesser shares. I need to get my foot in the door and then see who performs and who doesn’t. Wanted some Snowline but so does everyone else. Watch list. On the other hand, I bought back GR Silver with 20,000 shs because of price. But, just like every other day, some-up some-down, with -$39.05 for the day. I now have 43 stocks instead of 20 like 6 months ago. But the pattern does not change.
Nice mining picks there Lakedweller2. In addition to Calibre discussed above, out of the others you mentioned, I also hold Vizsla, Amex, Summa Silver, and Blackrock Silver. I did have GR Silver but it had sold off hard enough that I sold out of it for a tax loss, but have been considering back into it again. I was in Eloro twice for a swing trade both times, but have also considered getting back in there as well.
Placed a 1/3rd NUGT order near close of the day…As a trader using analytics rather than narrative, the patterns in gold, gdx, dollar and general markets was supportive of that action…glta
I have targets that are quite accessible for a 30 to 50% bounce…Why not
i will try to get my browser update to accept the charts I use in order to post them….Here take this pill it is real good…shut-up
Lol, some here scoff at such gains (like the 103% rise for NUGT off the January low😵).
With that said, I’m not sure we don’t have yet another dip straight ahead based on the unimpressive intraday action from GDX…
60 minute:
https://stockcharts.com/h-sc/ui?s=GDX&p=60&yr=0&mn=1&dy=3&id=p98109771993&a=1186950834&r=1657328246151&cmd=print
SILJ pulled back to perfectly fill (to the penny) yesterday’s little “hidden” gap today…
https://stockcharts.com/h-sc/ui?s=SILJ&p=D&yr=1&mn=3&dy=0&id=p93078818596&a=1149776311
HUI weekly bounced at two fork supports for a good weekly close but I wouldn’t be surprised if there’s an intraweek break of those forks so it can test 200 while gold tests 1700.
https://stockcharts.com/h-sc/ui?s=%24HUI&p=W&yr=5&mn=0&dy=0&id=p42756359056&a=1202299368
Silver’s COT structure showed another huge improvement this week to its best positioning since May-June 2019.
I’d like to see silver dip below 18 (16.50+/- for SLV) on Monday. That would likely end this corrective action decisively and possibly or at least nearly eliminate the commercial short position similar to the summer of 2018.
https://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=6&mn=0&dy=0&id=p70869751265&a=862056438
The TSX-V hasn’t been so oversold versus commodities since 2008…
https://stockcharts.com/h-sc/ui?s=%24CDNX%3A%24CRB&p=M&yr=18&mn=5&dy=0&id=t3410930052c&a=1191117099&r=1657330432256&cmd=print
Golden Cross Gold Miners Index
https://stockcharts.com/h-sc/ui?s=%21GCIGDX&p=W&yr=4&mn=11&dy=0&id=p68994931920
Golden Cross chart looks like the tracking of a yo-yo.
The Bank Of Canada will announce a 75 point basis rate hike next Wednesday. Interesting to say the most. DT
GR Silver under .10 US.
Permafrost melting in some parts of world that may cause buildings to sink in mud and mining not possible. Read it somewhere today but didn’t make a note of it. It started sinking in later (no pun intended) although I don’t have any of those kind of stocks …I think. (Arctic areas ?)
Yeah, there are a number of companies that need the areas to stay frozen for drilling over water, driving trucks over marsha swampy areas, and do seasonal work, but when things stay thawed for longer on different years, it can interrupt work programs.
Abe’s Assassination Shocks the World
Marc Chandler – July 08, 2022 $Euro, $USD, Canada, China, Federal Reserve, Japan, jobs, UK
“The June jobs report poses headline risk but is unlikely to alter the market views on the trajectory of Fed policy. In the middle of next week, the US reports the June CPI, and it is likely to have accelerated and moved closer to 9.0% from 8.6% in May, even though the core rate is expected to have slowed for the third consecutive month. The Fed funds futures imply almost an 85% chance of a 75 bp hike later this month. The median forecast for nonfarm payrolls has slipped a bit in recent days to stand at 265k. If accurate, it would be the lowest since April 2021. So what? From the Fed’s vantage point, the labor market is still strong (Powell has said “too strong”).”
http://www.marctomarket.com/2022/07/abes-assassinaiton-shocks-world.html