• Category Archives Technical Analysis
  • SILVER GREEN ALERT – ONE OF THE BEST BUYING OPPORTUNITIES FOR YEARS…

    There will be no equivocating, fence sitting or any kind of hedging or expression of doubt in what is written in this update. Let me be absolutely clear: – we are now at the threshold of a barnburner rally in the Precious Metals sector, and silver is set to scream higher driven by a massive short covering panic, because short positions in it have ballooned in recent weeks to levels way above what we saw in December 2015, when silver hit its final bearmarket bottom, before the big sector rally during the 1st half of 2016.
    We have been on to this for some time, hence the rash of articles over the past couple of weeks on the site recommending various good looking gold and silver stocks, and we will look at more this weekend. This is truly a massive opportunity, but these low prices are not going to be around for much longer. So if you want to fully partake of this rally and buy at the current crazy cheap prices, and haven’t done so yet, you had better pull your finger out and get on with it, because this market is not going to wait on your convenience.
    Don’t be fooled into thinking that because silver has rallied towards still bearishly aligned moving averages over the past week or so that it must drop back towards its lows again. That huge candle early this month on big volume which we can see on the 6-month chart below was a final capitulation reversal candle – a bottom. While the price has since been edging higher, the COT has continued to improve to the point that it is even more extremely bullish, so we can expect this so far hesitant rally to gain serious traction soon. Even if we do see a dip, which is considered highly unlikely, it would simply make the picture even more positive, although it is now scarcely possible that it can look much more positive than it is already.

    This post was published at Clive Maund on July 22, 2017.


  • Metals Moving But Not Leading

    The metals continue to rise and are accelerating now past resistance levels nicely.
    That said, I remain much more focused on leading stocks who are breaking out, not those coming out of corrections as the miners are.
    Nearly everything, including the metals, are working well so enjoy it for as long as it lasts.
    The trend is up.
    ***
    Gold gained 2.23% this week and moved nicely past the $1,250 resistance area where the 50 and 100 day moving averages sit.
    We should see this move take us back up to the $1,300 resistance level over the next few weeks.

    This post was published at GoldSeek on Sunday, 23 July 2017.


  • Metals Are Setting Up A Strong Upside Move

    First published on Sat Jul 15 for members: While I would love to suggest that we have begun the next larger degree rally already, the market has not provided me with strong indications that is going to be the case just yet. While there are many indications that the market may have already bottomed, there are just as many indications that we may see the dreaded one more lower low before a lasting bottom may be seen. But, I believe an investor should be preparing now for an impending rally which I believe will likely take hold over the coming weeks.
    Now, whether we see that lower low or not, I want to highlight something of which you should definitely take notice, especially if you are bearish this complex. Please take a look at the attached daily GDX chart.
    If you review the MACD historgram on the bottom, I have highlighted each of the 3 declines since we struck the high of the year back in February of 2017. Notice how each decline has taken place on weakening downside technicals. This shows clear evidence of waning sellers, as the selling has almost been completely exhausted.
    While we still can see one more drop to ‘fake-out’ those who have their stops just under 20.89, I believe this chart provides strong evidence of us being on the cusp of a very strong rally. In fact, if you review the bottoming histogram into late 2016, we saw the exact same evidence of waning selling, which led to the strong rally seen off the December low.

    This post was published at GoldSeek on Wednesday, 19 July 2017.


  • Chipotle ($CMG): Boom Goes The Dynamite

    I stopped eating at Chipotle the second I heard about the e-coli thing. Used to grab dinner there at least once a week. Have not been back. Along the way I’ve avoided the credit card hack to their payment system that surface a few months ago. Now it looks like there’s another viral outbreak at Chipotle of some sort: Virginia Chipotle Closed.
    I presented the idea of shorting CMG in the Short Seller’s Journal in the May 7th issue:

    This was my rationale:
    ‘I personally used to eat at Chipotle once a week before the e-coli problem. I have not been back since then. This is probably not he last we’ll hear of issues like at CMG. After the most recent unjustified bounce in the stock up to $475, CMG still sells at a 147 p/e. This is an insane p/e. With restaurant revenues declining across the industry, extremely overvalued stocks like CMG are vulnerable to big cliff-dives. You can see in the graph above that the stock appears to rolling again for another trip below its moving averages and under $400, at least. This is confirmed by the RSI and MACD indicators.

    This post was published at Investment Research Dynamics on July 18, 2017.


  • “Quant Quake”: What Was Behind Last Week’s Historic CTA Crash, And Is Another One Imminent

    While on the surface the market last week did nothing all that exciting, below it things were in abrupt turmoil – driven by the decoupling between stocks and bonds and the volatile, countertrend move in commodities and oil in particular – which was nowhere more evident than in the world of Risk-Parity funds and CTA, which suffered their worst two-week plunge since 2003.
    ***
    A subsequent report from Bloomberg revealed that the damage among trend-following CTA was especially severe, “by some measures, commodity trading advisers are on track to post the worst yearly return since 1987, when data were first collected on the group.” It also prompted the WSJ to write “Oil Up? Oil Down? Blame the Algorithms.”
    But what really happened last week, and will it happen again?
    For the answer we go to one of the foremost vol experts on Wall Street, the team of Chintan Kotecha, Ben Bowler et al at Bank of America, who today described what took place last week ‘Quant quake’, and who continues a long trend of pointing out just how “weird” and fragile the market is (no really, in late May he wrote “While not obvious on the surface, these Markets Are Very Weird“) by noting that markets continue to set long-term records for price instability or ‘fragility’, with a five standard deviation (5-sigma) sell-off in the S&P 500 on 17-May, a 3-sigma drop in the Nasdaq 100 on 9-Jun, and most recently a sharp rise in the bank’s cross-asset Fragility Indicator.

    This post was published at Zero Hedge on Jul 11, 2017.


  • Is ‘Oil God’ Andy Hall The Latest Victim Of “Fake News”?

    Raymond James’ J. Marshall Adkins invoked one of President Trump’s favorite phrases to explain oil’s plunge, and to excuse his bullish bias (that crude can rise to as much as $65 a barrel).
    As Bloomberg notes, conventional wisdom holds that resilient U. S. shale drilling, underwhelming progress towards OPEC’s goal in slimming global oil inventories, and output recoveries from nations exempt from the deal to curb production helped push crude down more than 20 percent from recent peaks. But according to Adkins – a noted oil bull – the bad times for oil can be chalked up to ‘fake news’ that amplified the downside.
    ‘The recent collapse in oil prices was triggered by a breakdown in the technical charts but fueled by the ‘negative feedback loop’ of bearish headlines that usually follow price declines,’ the analysts wrote in a July 3 note to investors. ‘Some oil price headlines have been misleading, or outright wrong, and they have distracted investors from what we believe is fundamentally a bullish overall picture.’
    Concerns have been overblown, the Raymond James analysts argued, saying trends pertaining to U. S. inventories, production and gasoline demand have been misinterpreted. They put out a list of ‘myths’ that explain the downturn and set out to debunk them in arguing that crude can rise about 45 percent from current levels.

    This post was published at Zero Hedge on Jul 7, 2017.


  • Ted Butler Quote of the Day 07-05-17

    I mentioned last week, that the larger the raptor net long position, the more it usually proved quite bullish for the price — and I still feel that way. However, I am bothered a bit by what is still a large Big 4 short position in gold, which usually isn’t indicative of a sustained bull move.

    Here’s the dilemma: Back at the price lows going into May 16 — to Friday’s report, the total commercial net short position is now only 7,000 contracts higher. But the Big 4 are roughly 30,000 contracts more short today, while the raptors are more net long by 34,000 contracts. I’m not sure what to make of this.

    I would classify gold’s market structure to be bullish, but perhaps not excessively so (as is the case in silver). I’m mindful that gold hasn’t completely penetrated, at least decisively, its 200-day moving average…a classic ‘all clear’ selling signal for the technical funds. Back at the early May gold price lows, the 200-day moving average had been decisively penetrated to the downside. Only a fool would completely disregard the still kind-of-high Big 4 short position — and the chance for a blast below the 200-day moving average more decisively than Monday’s price rig job lower. Since I’m primarily interested in silver, my concern is if lower gold prices will be used to influence silver lower as well.

      More precious metals news & information available at
    Ed Steer’s Gold & Silver Digest.


  • GLD Recognition Day

    Today is called a recognition day when it finally becomes apparent that the trading range is ending and you have a massive breakout move. We can still get a backtest to the breakout point which would represent the 2nd area to take a position. Today GLD gapped below the H&S backtest to the bottom rail of the black bearish rising wedge and that very important S&R line which last week I said came into play around the 117 area.

    This post was published at GoldSeek on 3 July 2017.


  • Bob Rodriguez: “We Are Witnessing The Development Of A Perfect Storm”

    Authored by Robert Huebscher via AdvisorPerspectives.com,
    Robert L. Rodriguez was the former portfolio manager of the small/mid-cap absolute-value strategy (including FPA Capital Fund, Inc.) and the absolute-fixed-income strategy (including FPA New Income, Inc.) and a former managing partner at FPA, a Los Angeles-based asset manager. He retired at the end of 2016, following more than 33 years of service. He won many awards during his tenure. He was the only fund manager in the United States to win the Morningstar Manager of the Year award for both an equity and a fixed income fund and is tied with one other portfolio manager as having won the most awards. In 1994 Bob won for both FPA Capital and FPA New Income, and in 2001 and 2008 for FPA New Income.
    The opinions expressed reflect Mr. Rodriguez’ personal views only and not those of FPA.
    I spoke with Bob on June 22.
    In a recent quarterly market commentary Jeremy Grantham posited that reversion to the mean may not be working as it has in the past. What are your thoughts on mean reversion?
    There will be a reversion to the mean. We are in a very difficult and challenging time for active managers, and in particular, value style managers. Many of these managers are fighting for their economic lives.

    This post was published at Zero Hedge on Jun 30, 2017.


  • Gold Bear Raid & Stock Market Alarm Bells Sounding – Are You Prepared? Golden Rule Radio

    The following video was published by McAlvany Financial on Jun 29, 2017
    This week we discuss the importance of listening to the alarm bells sounding regarding the Stock Market. These patterns of Divergence in the DOW Jones Industrial in the past have led to significant corrections and prudent investors need to be ahead of the curve. We’ll cover the Gold manipulation bear raid that occurred this last week, as well as the price movements of Silver, Platinum, Palladium, The US Dollar Index & the Dow Transports. The Dow Transports are starting to lag the Industrials another signal of instability and a pending correction for the stock market. Thanks for listening to this week Golden Rule Radio


  • Pending Home Sales Tumble, Unchanged Since June 2013

    After modest bounces in existing and new home sales (despite weakness in starts and permits and mortgage application declines), pending home sales in May tumbled 0.8% MoM and were revised even lower (-1.7%) in April. This dismal print was below all economists’ expectations, missing by 4 standard deviations.
    This is the 3rd straight monthly drop and 2nd straight annual decline in pending home sales.

    This post was published at Zero Hedge on Jun 28, 2017.


  • How Much Longer Can Junk Bonds Ignore Tumbling Oil? UBS Has The Answer

    One month ago, Goldman spotted a curious divergence in the energy sector: whereas in 2015 and 2016, the energy-linked asset class that had the highest beta to crude and was the most impacted as a result of the plunge in oil prices, was debt and specifically junk bonds while equities were relatively resilient to crashing crude prices, in 2017 this relationship had flipped, and – as of mid-May – despite the latest tumble in oil prices, HY Energy credits had returned 2.3% vs. 3.3% for the broader HY index, while Energy equities were down a whopping 9.6%.
    And while Goldman made some educated guesses for this abrupt shift in security sentiment, there still is no accepted widely reason for this striking divergence.
    One month later, UBS’credit analyst Matthew Mish picked up where Goldman left off, and in a note “Oil bear market: is corporate credit mispriced?” finds that the answer is mostly yes. Just like Goldman, Mish looks at the energy market in 2015 vs. today to answer the key question: “How has US energy changed?” Below we summarize several of his key thoughts:

    This post was published at Zero Hedge on Jun 26, 2017.


  • Will Gold’s Tumble Continue? Here Is Citi’s Answer

    This morning’s flash-crash dump of over $2 billion notional in gold futures broke numerous technical levels, but as the precious metal bounces back off support, the question is will the bounce continue? Citi answers…
    Having tested up towards its 50-day moving average (green line), this morning’s sudden and heavy volume flash-crash plunged the precious metal below its 100- and 200-day moving average (orange and red respectively below).

    This post was published at Zero Hedge on Jun 26, 2017.


  • Quants Dominate The Market; Unexpectedly They Are Also Badly Underperforming It

    Two days ago, JPM’s head quant made a striking observation: “Passive and Quantitative investors now account for ~60% of equity assets (vs. less than 30% a decade ago). We estimate that only ~10% of trading volumes originates from fundamental discretionary traders.” In short, markets are now “a quant’s world“, with carbon-based traders looking like a slow anachronism from a bygone era.
    Bloomberg confirmed as much today, when looking at another divergence between quant funds and traditional, discretionary managers: “systematic strategies have barely budged from near-record participation in U. S. stocks. Meanwhile, fundamental equity long-short managers can’t afford to be anything but picky, considering the market’s narrow leadership. The result: the largest gap on record between humans’ and computers’ gross exposure to U. S. equities, data compiled by Credit Suisse Group AG show.”

    This post was published at Zero Hedge on Jun 15, 2017.


  • The Dollar Bull Case

    I see just about everyone has their own theory or trading discipline on where the US dollar is headed next. It’s all these different ideas that make the markets work. Everyone can’t be bullish at the bottom or bearish at the top, it’s just the way it has to be.
    For my 2 cents worth I’m still looking at the possible fractal, bullish rising wedge as a halfway pattern to the upside. I did an in depth report on currencies and the US dollar several months ago in which I showed how it could play out. Since that report the US dollar has declined down to the point, where if the fractal is going to work, now is the time for the US dollar to put in its bottom.
    If you recall earlier this year the US dollar began building out a falling wedge while gold was building out a rising wedge. At the time I thought the US dollar would breakout topside and gold would breakout to the downside, but the markets never make it easy for you. A month or so ago when it became apparent that the US dollar was breaking down, I posted this daily chart looking for a measured move down to the 96.20 using the impulse method as shown by the blue arrows. The breakout to breakout method was a little lower at 95.45. So far the US dollar has reached a low of 96.45 were it has been chopping sideways for the last 2 weeks. If this is going to be an important low then we will most likely see some type of reversal pattern building out such as a double bottom or H&S bottom. So far we don’t have a recognizable reversal pattern in place. All the indicators are suggesting a potential low in here, but I want to see a reversal pattern before I get too excited.

    This post was published at GoldSeek on 14 June 2017.


  • JUNE 13 B/GOLD DOWN $0.80/SILVER DOWN 17 CENTS/AGAIN FOR THE 9TH CONSECUTIVE TIME, THE AMOUNT OF SILVER STANDING AT THE COMEX INCREASES IN QUANTITY/SHALE OIL PRODUCTION WILL HIT RECORD LEVELS BY …

    GOLD: $1265.30 down $0.80
    Silver: $16.74 down 17 cent(s)
    Closing access prices:
    Gold $1266.50
    silver: $16.84
    SHANGHAI GOLD FIX: FIRST FIX 10 15 PM EST (2:15 SHANGHAI LOCAL TIME)
    SECOND FIX: 2:15 AM EST (6:15 SHANGHAI LOCAL TIME)
    SHANGHAI FIRST GOLD FIX: $1274.99 DOLLARS PER OZ
    NY PRICE OF GOLD AT EXACT SAME TIME: $1265.80
    PREMIUM FIRST FIX: $9.19
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    SECOND SHANGHAI GOLD FIX: $1273.50
    NY GOLD PRICE AT THE EXACT SAME TIME: $1265.90
    Premium of Shanghai 2nd fix/NY:$7.60
    xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx
    LONDON FIRST GOLD FIX: 5:30 am est $1261.30
    NY PRICING AT THE EXACT SAME TIME: $1261.90
    LONDON SECOND GOLD FIX 10 AM: $1262.00
    NY PRICING AT THE EXACT SAME TIME. $1262.00
    For comex gold:
    JUNE/
    NOTICES FILINGS TODAY FOR APRIL CONTRACT MONTH: 11 NOTICE(S) FOR 1100 OZ.
    TOTAL NOTICES SO FAR: 2191 FOR 219,100 OZ (6.8149 TONNES)
    For silver:
    For silver: JUNE
    4 NOTICES FILED TODAY FOR 20,000 OZ/
    Total number of notices filed so far this month: 816 for 4,080,000 oz

    This post was published at Harvey Organ Blog on June 13, 2017.


  • Felix Zulauf: “Today Feels Like Late 1999; I Expect FANG Stocks To Fall 30% Or 40%”

    In his last interview as part of the Barron’s Roundtable, from which he is retiring at the end of the year after three decades of participation, Felix Zulauf, owner of Zug-based Zulauf Asset Management had some parting words of caution.
    First, in his discussion of stocks, Zulauf said “markets exhibit the signs we usually see going into a peak. My trend and momentum indicators are still bullish, but excesses are building up as stocks and sectors move too far above their moving averages. Investor-sentiment readings are getting excessive. July or August could bring an important peak in stocks.”
    Comparing to previous episodes of market exuberance, Zulauf said that “today seems like late 1999. We haven’t seen the peak yet. Much depends, as noted, on whether China continues its current policies. Either way, there is a window of vulnerability in the markets. I’m not talking about a 5% setback. It could be 20% from August to November.”
    As a reminder, this is what late 1999 looked like, and how it is oddly similar to the S&P tech sector currently.

    This post was published at Zero Hedge on Jun 13, 2017.


  • Another Day of Salami Slicing in Silver and Gold

    YESTERDAY in GOLD, SILVER, PLATINUM and PALLADIUM The gold price was sold lower by about five bucks or so going into the London open. From there it inched higher into the noon silver fix — and from that point the sell-off into Friday’s low price tick commenced. That came about ten minutes before the equity markets opened in New York. From there the gold price chopped quietly higher until around 2:45 p.m. in after-hours trading. Then about an hour after that, some kind soul peeled about five bucks off the price into 5:00 p.m. EDT close.
    The high and low ticks were reported as $1,284.60 and $1,266.70 in the August contract.
    Gold was closed on Friday afternoon at $1,266.40 spot, down another $11.20 on the day, but still above its crucial 200 and 50-day moving averages, but a slice off the salami nonetheless. Net volume was monstrous once again at 207,000 contracts.

    This post was published at GoldSeek on Sunday, 11 June 2017.


  • Goldman: “The Last Time The Market Acted Like This Was At The Tech Bubble Peak”

    Yesterday’s dramatic “rotational” divergence between tech stocks and the rest of the market, which as Sentiment Trader pointed out the only time in history when the Dow Jones closed at a new all time high while the Nasdaq dropped 2% was on April 14, 1999, stunned many and prompted Bloomberg to write that “a crack has finally formed in the foundation of the U. S. bull market. Now investors must decide if any structural damage has been done.”
    This year’s hottest stocks, companies from Facebook Inc. and Apple Inc. to Netflix Inc. and Nvidia Corp., buckled Friday, spurring losses that sent the Nasdaq 100 to its biggest drop relative to the Dow Jones Industrial Average since 2008. An alternative explanation is that the purge in tech stocks, responsible for half the market’s gains in 2017…

    This post was published at Zero Hedge on Jun 10, 2017.