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Craig Hemke – Technical Outlook And Macro Thoughts On US Equities, Gold, Silver, And Mining Stocks

Shad Marquitz
September 22, 2022

Craig Hemke, Editor of TF Metals Report, joins us to review his technical outlook for the US equities markets, as well as for the precious metals, and the macroeconomic factors on his radar.  We start off looking at the key technical support levels for the S&P 500 and Craig feels it looks most probable after this weeks action, that it will go down and test the June lows near $3650 again.   The concern if that support was to fail is that it could expediate a sharp move downward and liquidity event that would hit most sectors, including the precious metals.

 

With regards to gold, it did dip below the key support in the $1673-$1675 area last week, but only got down to $1661-$1662 and then reversed back up above the key support, so there were not a large number of sell stops triggered on that move.  We also made note of the constructive recent outperformance of silver over gold, and the bullish contrarian reading in the COT reports for silver.  In addition, silver and even the mining stocks stabilized this week despite the US dollar continuing to move even higher.  Despite the bearish moves in gold, this divergence in silver could present a scenario where it is signaling that it already bottomed and bounced, and that the drop in gold may be more short-lived.

 

We wrap up with a look at GDX and SIL at proxies for the mining stocks, noting their sideways channel has allowed some of the oversold momentum indicators to cool off some, and the question is poised if this could allow another move lower.   Craig’s position is that while this is possible for the mining sector overall, that he encourages investors to do their homework and select quality teams and projects that may still outperform, noting the performance of AbraSilver Resource Corp (ABRA) (ABBRF) over the balance of this year.

 

Click here to visit Craig’s site – TF Metals Report.

Discussion
36 Comments
    Sep 22, 2022 22:30 PM

    Alessio Rastani – Warning: The Kiss of Death Signal on the Stock Markets

    Some of the key major markets such as the S&P 500 have fallen by 20% from their all time highs (peak to trough). This is typically referred to as a “bear market”. However, we have explained before that the “20% rule” is not a very reliable indication of a bear market. So in this video we shall examine a simple and much more powerful method for identifying bear markets. This strategy is called “the kiss of death”. We shall explain the steps of this simple method and look at some key examples, such as the 2008 crash, the 2000 “dot com” crash, the 1929 Wall Street Crash and so on. The big question remains: is the stock market about to trigger a “kiss of death” bear market signal this year? And if so, how will we know and what could it mean? We shall look at the charts.

    https://youtu.be/0Zrbk-Oo7ak

    Reply
    Sep 22, 2022 22:33 PM

    Palantir CEO Alex Karp Says This Deadly Tidal Wave Of Macroeconomic Risks Will Wipe Out Some Companies

    Yun Li – CNBC – Thursday September 22 2022

    “Bad times are incredibly good for Palantir … bad times really uncover the durable companies, and tech is going through bad times … interest rates are the reason,” Karp said Thursday on CNBC’s “Squawk Box.” “Will this deadly tidal wave wipe out some companies? Yes it will.”

    “The Federal Reserve on Wednesday raised benchmark interest rates by another three-quarters of a percentage point to a range of 3%-3.25%, the highest since early 2008. The Bank of England, the Swiss National Bank, and the central banks of Norway, the Philippines, South Africa, Taiwan, Vietnam and Indonesia followed suit, hiking rates to control inflation that has spiraled over the last year…”

    https://www.cnbc.com/2022/09/22/palantir-ceo-alex-karp-says-tidal-wave-of-macroeconomic-risks-will-wipe-out-some-companies.html

    Reply
    Sep 22, 2022 22:06 PM

    Beaver Creek: Miners get things done in underexplored West Africa

    Henry Lazenby – The Northern Miner – September 21, 2022

    “Amid an ebbing of mining investment sentiment as project proponents big and small take a pause and wait out decade-high inflation and high interest rates, West Africa is an outlier, emerging as a region where mine construction timelines are met, builds get completed under budget and discovery potential beckon more investment.”

    “The Northern Miner recently caught up with a handful of mineral explorers and miners attending the Precious Metals Summit in Beaver Creek, Colo., with each executive exuding a sense of business confidence contrasting in some cases with the realities of doing business in, for example, North America in recent quarters.”

    “Orezone Gold (TSX: ORE; US-OTCQX: ORZCF) earlier in September became Burkina Faso’s newest gold producer after completing the Bomboré mine’s first gold pour under budget, on time, and with no lost time injuries,” said president and CEO Patrick Downey.

    “West Africa is where the mining industry can still execute construction plans as planned,” he said.

    “In a short span of twenty months, we have successfully financed and constructed this greenfield project, mined over 15.7 million tonnes of material, including 5.8 million tonnes of ore, while maintaining the health and safety of our workforce.”

    https://www.northernminer.com/news/beaver-creek-miners-get-things-done-in-underexplored-west-africa/1003846620/

    Reply
    Sep 22, 2022 22:07 PM

    20% drop is like a good day in my miners. Tired of the Sacred Cows and their milkers? Let them fail and wait for an explanation from anyone elected. Not going to happen … but at some time, reality will take over and the fact that it is unpleasant begs the question why it happened and why am I poor. The answer is always theft. Do something other than rationalize …criminals need your vote and support. ( Do you really think your party has an answer …not as long as Citizens United is in place). Ask your Political person what their position is on Citizens United and they might as well be asked if they stopped beating their spouse.

    Reply
      Sep 23, 2022 23:57 AM

      Good one Lake……………. just think,…… they could go NO BID……….. Be Happy…….. Not the end of the World,…Yet…… Freaky Friday, ……anything could happen when Joe B. is out of the cage…

      Reply
    Sep 23, 2022 23:16 AM

    /GC day… today is the symmetric 3Drive pattern down completion date…will it produce a key reversal day?….I will get in by following the 1 minute through 30 minute chart action….and find out…

    The ABC down 1:1 target is hit early AM at 1645….Will it expand to 1.618 likely..imho……glta

    https://tos.mx/jTxF4H4

    Reply
    Sep 23, 2022 23:33 AM

    Month GDX…..TAS support is at 22.11….This would nearly complete the ABC down at 20.04 plus a buy the ‘D’ point plus a Gartley Buy pattern… cannot get a bunch better on long term charts…Will it happen today?…60% probability…So if final capitulation is not today it is a relatively smaller price decline ahead…Is the timing correct enough?…not sure of that, but near…glta

    Gold related signals that matter frequently V bottom but that follows major panics…This signal may trade in a range sideways on weekly bars for a while…So stabs at picking the exact bottom may be ill advised….

    Note: Monthly volumes currently into the major 2020 V bottom are significantly big-time lower….like 2.2 plus billion vs maybe 400 million eventually this month……If this similiar fractal was present on say a 10 minute chart w the same patterns present you buy for at least the counter trend rally….More slop is likely on a monthly time frame but that is how the decision point plays out…..or just wait for confirmation from daily charts…The preferred method imho….

    https://tos.mx/B3JG8CL

    Reply
    Sep 23, 2022 23:09 AM

    240 minute /GC…looks like the ABC down will NOT complete pre-market at 8 AM….Low volume through that B point plus price hit 200% expansion, which is big hit when we are down so much anyways….someone is buying w pretty strong pre-market strength…..

    https://tos.mx/srV17A4

    Reply
    Sep 23, 2022 23:19 AM

    day DXY…Very strong still….But it could find a top soon….The RSI is around 71 which is not weaker and diverging from other peaks…Will it stop here…maybe…price is in a TD9 count at 7 today..plus in leg F up out of a G possibility….so the price could run out of momentum overnight tomorrow…seems unlikely w WW111 breaking out…no idea…..The markets are very much involved in significant events and how will it all get priced in?….So going long gold miners etc…over a weekend seems like not a high volume maneuver by market participants…but that is exactly why it could occur….or Sunday could Sunday get the final smack down?

    https://tos.mx/ji5pLTA

    Reply
    Sep 23, 2022 23:54 AM

    FREAKY FRIDAY…………………. AGAIN…………………………………………………………………………………….

    Reply
      Sep 23, 2022 23:23 AM

      super freaky…i read zero hedge…fed is regretting…getting us ready for pivot…think so!

      https://www.youtube.com/watch?v=QYHxGBH6o4M

      Reply
        Sep 23, 2022 23:20 AM

        THE FAKE FED……….. is such a LIAR……
        END THE FED……………….. is the ONLY SOLUTION to all the madness….along with
        TERM LIMITS………………. for all the” con” gress.

        Notice……… the word….”YEARS”
        This sends a mixed message as to how much the Fed is really committed to reducing price inflation, but it’s clear Powell was trying to project a hawkish tone on Wednesday overall.

        Powell spoke of “significantly reducing the size of our balance sheet” and also emphasized that ending the current bout of inflation will require pain in the form of job losses. He also emphasized that there is no short-term solution, strongly implying that the current effort to end inflation could possibly take years.

        Reply
        Sep 23, 2022 23:30 AM

        Now, thanks to Powell’s mistakes, price inflation is supercharged, and even he admits it could take years of economic stagnation or decline to bring it under control. The sheer level of ineptitude would be shocking if it were not so common for central bankers. For those people, their entire “strategy” can be summed up—as Peter St. Onge puts it—”Hike til it breaks, cut til it inflates.” There’s not much more to it than that. That’s the best all those PhD’s at the Fed have managed to come up with. Thanks to Powell and Yellen and Benernake and Greenspan, we’ve living with the consequences of the Greenspan Put, followed by a decade of QE, followed by the “panic and print money” mania of the past two years. It’s great that Powell is finally figuring out what the real world looks like. Unfortunately he’s years behind.

        SAME SICKNESS…………..has continued for DECADES…………..anything going to change, when you have the same IDIOTS, which are designed to be there at the SHEEPLE’s Expense…….

        Reply
    Sep 23, 2022 23:16 AM

    from zerohedge article……..
    ..Goldman Throws In The Towell: Slashes S&P Price Target To 3,600… Warns Of Recesion Crash To 3,150
    (the writer should use spell check)……. 🙂
    Couple final observations: while it will come as news to many that Goldman has flip-flopped from one of the most bullish to one of most bearish banks on Wall Street, those who had been reading the notes and comments that we publish from the bank’s Sales and Trading and flow desk, knew long ago that this bearish pivot was coming and none of this should come as a surprise. Perhaps more importantly, now that even Goldman has turned bull bear, the bottom may finally be in sight, because if Goldman’s base case is to urge all, not just a handful of its best clients, to sell, then the bank’s traders are officially buying everything that is thrown their way…

    Reply
    Sep 23, 2022 23:20 AM

    day GDXJ…very low volume liquidation event…..monday smack and then buy?…very possible….gdxj targ 26.54 to 25.52…why not give it a shot…gird up…
    https://tos.mx/Qhymhqo

    Reply
    Sep 23, 2022 23:00 AM

    At this point, the covid crash lows around 140 have to be a realistic, if not likely, target for the HUI. For next week, a move down to 160 and lower looks very doable barring a reversal into today’s close.

    I am a bit surprised at the speed and magnitude of this sell off, but I suppose when gold has a possible $1450-1550 price target it’s not too shocking.

    Reply
    Sep 23, 2022 23:22 AM

    GOTS…..and……. PHYZ……………

    Reply
    Sep 23, 2022 23:23 AM

    Looking at Brixton, it is doing what I have been anticipating, which is to sell off over the next month.

    I already have a decent position, but will add only if the 14 day RSI reaches oversold. I think it will ultimately undercut its July low, and that will be a great time to buy it.

    Reply
    Sep 23, 2022 23:33 AM

    GATA……………………….
    From Bloomberg News
    Thursday, September 22, 2022

    Gold in China is trading at a huge premium to international prices as a revival in demand outstrips the countrys imports.

    Benchmark prices in Shanghai have climbed to a premium of more than $43 an ounce over their London equivalent,

    Reply
    Sep 23, 2022 23:58 AM

    Doubled Lion One holding.

    Reply
      Sep 23, 2022 23:41 AM

      Yeah, I left more comments about the accumulation zone Lion One is in over on the Erik Wetterling editorial blog. The risk/reward proposition gets more and more attractive the more emotional retail traders capitulate. These are the kinds of scenarios that should get savvy resource investors to sit up and take notice. The bought deal was just announced earlier this week at $0.77 and now the stock is trading down to $0.65 a few days later on the low sentiment and gold breaking $1673-$1675 support again. We’ve not seen these prices in LIO in a long time, and they’ve found far more high-grade gold since that time, tested their thesis on the alkaline system at depth successfully, and now own 7km of the whole volcanic caldera, so they’re actually a much a better company now than where they were then. Keep in mind just a few months back this stock traded up to $1.66 on the stellar bonanza grade gold intercepts, and it was a $2.66 stock just 2 years ago. You gotta love these whipsaw markets for the opportunities they bring to the table.

      Reply
        Sep 23, 2022 23:56 AM

        There are many deals across the sector right now though, so I don’t mean to insinuate that LIO is the only bargain out there, it has just been topical this week with all the emotional panic selling in Lion One and negative sentiment on the company. Plenty of other companies are looking quite compelling here as well.

        I sold 2 copper stocks that had vastly underperformed today, to be able to pounce on a few other deals, and added the final tranche of IPT Impact Silver today, as I’d been waiting for one last flush to add one more layer. From here I’ll just have to ride out any further weakness in that stock as it is about as big of weighting as I want in my portfolio.

        There are a few other gold producers and royalty companies that are looking more attractive as well, and almost all the gold developers and silver developers are at silly valuations here, so it’s a difficult call which ones to allocate a bit more capital to. I’ll likely bring some more cash into my trading portfolio later today to pounce on deals next week. I’ve resisted bringing more cash into the account to force myself to horse trade between existing or new positions, and have worked to just generate some more cash swing-trading positions, but these are special situation sell downs, and it seems like a good time to cash up my account a bit more and be opportunistic in the weeks to come.

        Reply
          Sep 23, 2022 23:43 AM

          I treated Libero as a tax loss today and moved most of the remains to Midnight Sun. Added also to Pure Gold as it is showing some strength in the face of the Central Bank imposed stress in markets. Will look at Libero in 31 days and compare to Midnight Sun for possible move back. (Midnight Sun has been my second best performer which is not saying much).

          Reply
            Sep 23, 2022 23:27 AM

            Yep, I blew out both Libero and Kodiak for the short term. Booking the loss in both, but I still like both companies, and will get back in again down the road, once we see a turn in the PMs first. At present, I want to keep my focus on the gold and silver stocks for the short to medium-term. I’ll then beef up some of the battery metals and base metals again once there are some gains in the PM stocks to rotate into them.

    Sep 23, 2022 23:35 AM

    Yesterday I anticipated a gap closure on AEM. Now I think there will be undercut of July low

    https://stockcharts.com/h-sc/ui?s=AEM&p=D&yr=0&mn=5&dy=0&id=p87143433027&a=1256052354&r=1663950794997&cmd=print

    Reply
    Sep 23, 2022 23:40 AM

    Big picture doesn’t change much with Agnico – one of the best PM miners out there (even better than Newmont) Plus, pays good dividend.

    https://stockcharts.com/h-sc/ui?s=AEM&p=M&yr=20&mn=5&dy=0&id=p98040977368&a=1256610228&r=1663951074477&cmd=print

    Reply
    Sep 23, 2022 23:33 AM

    Anyone has DSI numbers for Gold and Silver for today?

    Reply
    Sep 23, 2022 23:02 AM

    daily /GC…update…Volume Confirmed larger AB=CD down…… 1.272 expansion target is 1556…..Expect it to happen Sunday and first hour of day Monday……The smaller ABC down has target 1537 at 2.618 expansion target…so, confluence is present as well as volume….That is the buy for me if that happens…

    https://tos.mx/ufNQyH9

    Reply
    Sep 23, 2022 23:06 AM

    China keeps stacking Phyz………………… should tell you something……….
    and Chinese want duel citizenship in America… ?

    Reply
      Sep 23, 2022 23:25 AM

      Yes, agreed OOTB. The big transition in gold from West to the East continues…

      Reply
    Sep 23, 2022 23:12 AM

    Gold below $1650

    DOW below $30000

    Reply
      Sep 23, 2022 23:24 AM

      Yep, the US Dollar has continued surging higher and higher an is currently at 112.81 getting close to pushing a 113 print. Relentless, and brutal for commodities, due to how the HFT algos trade in relation.

      The main reason for this is what a basketcase the Euro, Yen, and Pound are, along with their underlying economies, so it just pushes the Dollar higher on the other side of the teeter-totter.

      Now Silver is back under $19, Gold is under the key $1673-$1675 support down around $1651, and Oil is below $80 again near $78.60. Wild times in the commodities sector.

      Reply
        Sep 23, 2022 23:21 PM

        Yeah … reminds me of the good old days when the Citizens United Person of several Wall Street Banks pled guilty to Forex manipulation.

        Reply
    Sep 23, 2022 23:31 PM

    I think we are days to weeks away from a major low in the PM complex. I say this because I expect that commodities (GCC) will bottom more or less simultaneously, just like they did in 2016 and 2020.

    I’ve been expecting GCC to tag its rising 100 WMA before the correction is over, and that level is fast approaching. Also, you can almost 100% expect an overshoot to the downside but I believe it will be very brief (by brief I mean a few weeks at most). That is my expectation.

    All that being said, I have no idea what a price recovery is going to look like. I’m least expecting a V-shaped recovery, but who knows. I expect GCCs 30 WMA and 100 WMA to converge with each other before another leg up can occur. The longest I could see that taking is by about June of 2023, which more or less comports with my view on silver being trapped in a lower trading range for a while (with the caveat that a rally back to the declining 100 WMA is possible at any time).

    Reply
    Sep 23, 2022 23:55 PM

    Take the name of the chart………………In any event when in waterfall mode…………..it’s a fools errand to try and pick a bottom…………………………………………..have been stapled to the ground with a javelin through the heart too many times !!!!

    Unfortunately the REVERSE liquidity event has another 125 basis points to go on the dot plot at the FED………..do we really want to fight the FED…………..irrespective of any sign of intelligence that might be even remotely found amongst them !

    I still am convinced it’s all part of the great reset…………….the wealth transfer already took place at the end of 2021 when no-one was looking and waiting for more……………….greed is always the grim reaper !

    Sticking to David Rosenberg’s call of S$P 3000 for a bottom !!

    Reply
      Sep 23, 2022 23:35 PM

      Powell wants to crush Europe, particularly Germany and destroy the middle class everywhere.

      Reply

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