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Jordan Roy-Byrne – Macro Views On Hotter CPI And Fed Policy, Technical Outlook on Silver, Gold, and Mining Stocks

Shad Marquitz
September 14, 2022

Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to discuss the fundamental macroeconomic trends with inflation and Fed policy, and then provides a technical outlook on silver, gold, and the PM mining stocks.  We discuss how the Fed funds futures market responded to the hotter CPI inflation reading, and how inflation is not going down to the central bank’s goal of 2% anytime soon.  As a result the markets are now pricing in more hikes after September, which moved both interest rates and the US dollar higher.

 

We then shift over to getting Jordan’s technical outlook on silver, gold, the gold:silver ratio, and the precious metals mining stocks.   Silver had a nice bounce this week, relative to most other markets and gold, and there is mixed technical data in relation to whether we can see a short-term bounce in the sector or if we see the move below $1675 in Gold, and a few potential paths forward. 

 

 

Click here to visit The Daily Gold website and keep up to date on Jordan’s technical outlook.

Discussion
44 Comments
    Sep 14, 2022 14:11 PM

    Tian Yang On The Virtues Of Variant Perception Versus Unconscious Conformity

    Jesse Felder – The Felder Report – (09/14/2022)

    https://thefelderreport.com/2022/09/14/tian-yang-on-the-virtues-of-variant-perception-versus-unconscious-conformity/

    Reply
    BDC
    Sep 14, 2022 14:56 PM

    Trends: https://tinyurl.com/4ypebbv9
    NatGas Top Sans Rail Strike
    PMs Holding So Far
    Quad Friday

    Reply
      BDC
      Sep 15, 2022 15:54 AM

      Rail strike likely avoided.

      Reply
      BDC
      Sep 15, 2022 15:01 AM

      PM correction underway.

      Reply
    Sep 14, 2022 14:32 PM

    In 11+ years between 2002 and 2013 gold didn’t touch its 200 week MA, not even in 2008, yet it now looks like it will do so very soon after less than 4 years…
    https://stockcharts.com/h-sc/ui?s=%24GOLD&p=W&yr=5&mn=0&dy=0&id=p71403522500&a=1250955957

    Reply
    Sep 14, 2022 14:35 PM

    After just 4 days “long” the parabolic SAR flipped gold back to short today…
    https://stockcharts.com/h-sc/ui?s=%24GOLD&p=D&yr=1&mn=1&dy=0&id=p40676075671

    Reply
    Sep 14, 2022 14:56 PM

    SILJ:GDX gapped up to its highest level since April this week but is now sitting at last week’s close.
    https://stockcharts.com/h-sc/ui?s=SILJ%3AGDX&p=W&yr=3&mn=11&dy=0&id=p43025558025&a=1215875558

    Reply
    Sep 14, 2022 14:12 PM

    Powell must be losing some sleep with September 20 approaching and the ECB going up.75 points recently. He really wants to crush those Europeans and may go up 1% just to show them who’s in charge here.

    Reply
      Sep 14, 2022 14:32 PM

      All those silly “pivoters” and their defenders sure have gotten quiet. Maybe now they’re catching onto the fact that this is a once in several generations paradigm shift that is a LONG ways from done.
      Luckily, bonds are finally due for a break that will coincide with higher gold.
      https://stockcharts.com/h-sc/ui?s=TLT&p=D&yr=1&mn=1&dy=0&id=p58315579126&a=1250981903

      Reply
        Sep 15, 2022 15:54 AM

        Interested to know what you think changes in the narrative to cause gold and the miners to start rising. Afterall, gold and the miners’ drop has coincided exactly with the Fed’s initiation of tightening. (Therefore, if the Fed continues to tighten, then gold and the miners should ostensibly continue to drop.)

        Yes, I know, in the 1970s gold was able to rise despite the Fed raising rates, since real interest rates were still deeply negative. Well, despite the Fed raising rates since the beginning of this year, we still have deeply negative real interest rates and yet the miners and silver have tanked and gold has fallen considerably.

        So what fundamentally changes to cause miners, gold and silver to rise?

        Reply
          Sep 15, 2022 15:27 AM

          The pitchforks will tell you LOL

          Just being flip Green, not investment advice.

          Reply
            Sep 15, 2022 15:50 AM

            Well I will be forthright in stating that my thesis–that “the Fed can never raise interest rates”–was categorically disproven in 2016.

            Then I adjusted that to–“the Fed can never raise interest rates to any substantial degree.” Well, I am being proven wrong by the day by the Fed.

            And yet, I have not made any adjustments in my portfolio as a result of the failures in my investment thesis, and I continue to “hope” that something changes, because well, it HAS to based on history.

            At present, I don’t see how gold and silver get any traction until the liquidity spigot is actually opened back up by the Fed. I don’t care what happened in the 1970s, since at present it is clear the Fed’s tightening has been directly responsible for gold’s and mining stocks’ fall despite interest rates remaining deeply negative. So if Matthew is right, and the Fed is going to continue to hike without any pivot any time soon (years? a decade?), I don’t see what catalyzes a move higher in gold, silver and the miners.

            I’m sure some day the goldbugs will be right, but it seems highly likely I will be dead and buried when that day comes. And so much for gold and silver showing any type of outperformance vs the broader commodity complex, much less in absolute terms. Yes, I know gold and silver spiked to all time highs vs commodities during covid, but to get thrashed like they have relative to just about anything else on planet earth since the largest money printing spree the world has ever seen has been disheartening.

            It’s heads I win, tails you lose, with the Fed.

            Sep 15, 2022 15:13 AM

            Great comments Green……………. thanks for sharing your history ……..
            The FAKE FED……… can do anything, anytime,… everything is a guessing game… JMO

            Sep 15, 2022 15:30 AM

            As with silver, it looks like gold’s 100 WMA is ultimately headed for a negative cross of the 200 WMA or at least should come very close to the 200 WMA.

            How that plays out in terms of price action is anyone’s guess. what it does suggest is that any hopes of an explosive breakout in gold occurring before late 2023, or more likely 2024, are a pipe dream.

            the rest of this year and 2023 are going to be an absolute mess in the metals themselves. Perhaps the miners will fair better.

            Sep 15, 2022 15:02 AM

            Hey jony you sure are proud of being moron. The forks do indeed tell just as multiple other tools do.
            What a little pile of completely worthless shit you are.

            Everyone else can sell for safety based on today’s action but I’m not doing so yet. Know thyself.

            Sep 15, 2022 15:46 AM

            Matthew, you certainly have a way with words.

            Sep 15, 2022 15:06 PM

            You’re certainly a nuisance like shit on a shoe.

    Sep 14, 2022 14:39 PM

    The surprise in CPI was they didn’t lie as much as usual. They ran the same algos as if CPI was lower than reported, so same end result.

    Reply
    Sep 15, 2022 15:43 AM

    Time to look at Monthly /GC for bottom clues…glta

    https://tos.mx/QqV34kE

    Reply
    Sep 15, 2022 15:07 AM

    It’s anyone’s guess where gold stops now. The 400 WMA at $1457 and rising is now in play IMO, have no idea what the time horizon for such a move could be–again, anyone’s guess. If I had to guess, it would be that gold will tag the 400 WMA sometime in the first half 2023–after the 400 WMA has crossed back above the 600 WMA, probably around the $1500-1550 level.

    The story is, as long as the Fed continues to tighten, the lower gold will go. How can the argument be any different?

    The fact that the miners and silver have “outperformed” gold for a month or two is little comfort, since nothing ever goes down in a straight line. If gold completely falls out of bed, I have absolutely no doubt the miners and silver will eventually cascade lower as well.

    Reply
      Sep 15, 2022 15:43 AM

      Yes Green, what matters is the relative performance (upside leverage) that gold sector equities should provide vs their underlying product gold. That’s what’s been missing for months with rare exceptions, gold rangebound while the equities got absolutely hammered. In spite of all the positive fundamentals of rampant inflation and a war with all it’s disruptions.
      Anyone’s guess when this changes, just maybe Powell declaration on the rate rise next week will be the moment to buy the news, at least for scalp with another pop up.
      Irrespective, Goldbugs forever touting the long haul and holding their 95% investment position during this period have a painful recovery ahead unless we get a moonshot. Good luck.

      Reply
        Sep 15, 2022 15:57 AM

        Well, purely technically speaking, I still like stocks like PAAS, although it could be weak and potentially make marginally lower lows until the early spring of 2023. If it hit $13, I wouldn’t be shocked.

        Then again, it could have made its long term low 2 weeks ago.

        I say buy it on weakness only, but recognize you may not be in the green until the second half of 2023 and you will almost certainly have to suffer with being underwater for at least some amount of time if you buy between now and the spring 2023. I think a reasonably low risk entry would be to wait for a solid weekly close above the 20 WMA.

        Reply
      Sep 15, 2022 15:59 AM

      I’m looking at Au on a monthly 140 Moving Average = $1461, specifically that 140 to perfectly hit the Dec2015 low. On an overthrust down to $1400 & $1365 I’d be buying actual metal again

      With Ag, I’m using the 244 monthly MA = $17.22 based on the progression of touches in 2018-2020

      Reply
      Sep 15, 2022 15:00 AM

      Green,
      The outperformance of of silver vs gold and especially silver juniors vs gold seniors has been significant enough to represent a clear bullish message. SILJ:GDX bottomed 4-5 months ago and began this week up 29% and is still up 18% currently. Aside from that, there are many other factors that suggest this could be a brief bear trap so I’m going to watch the action closely and see how the week closes. However, as stated above it does make sense to stop one’s self out here by exiting recently acquired long positions.
      If it turns out not to be a bear trap and gold is about to plunge, I’d bet it’s because it “knows” that the stock market is about to do the same. Year after year there have been a lot of stock market crash-callers and I have not been one of them but this year does present the best crash risk we’ve seen in many years.
      https://stockcharts.com/h-sc/ui?s=SILJ%3AGDX&p=W&yr=3&mn=11&dy=0&id=p64720853059&a=1215875558

      Reply
    Sep 15, 2022 15:09 AM

    87 gas in nearby Damascus, Md $3.19 today 9/15

    Reply
    Sep 15, 2022 15:20 AM

    $1666

    We broke through $1675

    Where is Joe?

    Reply
      Sep 15, 2022 15:27 AM

      Joe’s just been vindicated. Matthew just posted it makes sense to stop one’s self out here by exiting recently acquired long positions.
      Way to go Joe.

      Reply
        Sep 15, 2022 15:33 AM

        There have been COUNTLESS buys and sells since gold topped 2 years ago and you and your beloved “prescient” Doc couldn’t identify one of them. The forks showed them to you but you haven’t done sufficient homework to make sense of anything technical.

        Reply
    Sep 15, 2022 15:31 AM

    I bought the retrace on GDX…….618 on daily….becomes first ABC up?….How are we going to pay the interest on debt nationally?…borrow more…lmao…worth a shot…glta

    Reply
      Sep 15, 2022 15:36 AM

      I agree. The picture is bearish on its face but the details contain so much that isn’t.

      Reply
    Sep 15, 2022 15:56 AM

    Silver’s strength relative to gold is even more impressive in light of today’s action.
    SLV:GLD is still 5.4% above last week’s close despite its huge weekly gap up and the new low for gold…
    https://stockcharts.com/h-sc/ui?s=SLV%3AGLD&p=W&yr=3&mn=0&dy=0&id=p09854183047&a=1243076287

    Reply
    Sep 15, 2022 15:14 AM

    There is a dirty head and shoulders on the gold daily chart that is arguably in play now. It projects down to somewhere between $1550 and $1600.

    Crash scenario definitely in play (as it has been since gdx:gld tanked this year, much like it did in advance of the 2008-09 crash). It’s the perfect time of year for it too. Just have to see how much pain Jerome is willing to take. By the sound of his rhetoric, quite a lot.

    Don’t fight the Fed.

    Reply
      Sep 15, 2022 15:43 AM

      Green, in light of the positive fundamentals for gold, should it get to your projection at below 1600, that would be a gift. At that point gold equities would be priced for oblivion and a fire sale for those with cash, bo matter the intended holding period.
      Fun to speculate but let’s see what next week’s rate increase does. Markets are perverse and the opposite just may happen. No rush to do anything here.

      Reply
        Sep 15, 2022 15:11 PM

        No doubt you are right.

        I’ll say it again though, silver’s 100 WMA has a date with its 200 WMA. What that suggests strongly to me is there is either more downside left or a long period of consolidation or both. With the caveat that silver could spike to tag or even marginally exceed its declining 100 WMA before reversing back down, there is literally no reason to get long silver here from a risk reward standpoint. There is still a huge amount of space between the 100 WMA and the 200 WMA, and that space will be completely eliminated eventually–either through time or price or more likely, both (consolidating in time is healthier IMO).

        All that being said, I do like some silver miners down here, but by no means is a buy down here without major risk. Objectively, I do see stocks like PAAS as having a better risk reward profile than silver itself. Again, could PAAS crash to $13 next week? Why not.

        And I defy anyone to tell me what the catalyst for a huge bull will be at the moment, especially those that say there is no Powell pivot coming any time soon.

        Reply
          Sep 15, 2022 15:50 PM

          I have never concerned myself with catalysts. The fundamentals are in place and the technicals are getting there.

          Reply
    Sep 15, 2022 15:47 PM

    KTN reached fork support as it filled a huge 9% gap from last week…
    https://stockcharts.com/h-sc/ui?s=KTN.V&p=D&yr=1&mn=1&dy=0&id=p86727670649&a=1157758033

    Reply
    Sep 15, 2022 15:48 PM

    From a cyclists perspective, I imagine today is extremely bearish since gold has made a lower low after making higher lows over the last 2 years.

    As with silver, I don’t think gold is worth buying until its 100 WMA gets close to its 200 WMA, and right now there is a lot of space between those two moving averages.

    $1500 sounds like a real possibility, and as Jordan pointed it out, it would represent about a 50% retracement.

    Reply
    Sep 15, 2022 15:56 PM

    SILJ:GNX is reacting at fork resistance just as it did in April…
    https://stockcharts.com/h-sc/ui?s=SILJ%3A%24GNX&p=W&yr=5&mn=5&dy=0&id=p20000295034&a=1243598237

    Reply
      Sep 15, 2022 15:09 PM

      Whatever silver miners do relative to commodities in the near term, that chart just shows how pathetically miners have performed since 2016. On a risk adjusted basis, well, they may just be the worst asset class, ever.

      Reply
        Sep 15, 2022 15:13 PM

        Both are extremely cyclical so trading them is a must. SILJ did triple vs GNX in 2019-20.

        Reply
    Sep 15, 2022 15:03 PM

    I recently said that I’d buy more IPT if it sees .26 again and that’s still the case.
    https://stockcharts.com/h-sc/ui?s=IPT.V&p=D&yr=1&mn=1&dy=0&id=p90147270334&a=1251491752

    Reply
    Sep 15, 2022 15:15 PM

    GDX finished right at fork support but I would welcome a gap down to its Sept. 1st low tomorrow. Whatever happens, a strong rise is needed in the next day or two to keep the short term bullish potential on track.
    https://stockcharts.com/h-sc/ui?s=GDX&p=D&yr=1&mn=5&dy=0&id=p10083728485&a=1092763429

    Reply

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