Category Archives: Financial Markets

GSR & US Dollar

So our thesis has been that a concurrent rise of USD and the Gold-Silver ratio (GSR) would not be a good thing for markets.  Stick it in the blender and mix with several other indicators (we have not even mentioned weak junk bonds and junk to quality credit spreads, at least not publicly) and you have ‘so far, so good’ on a coming bear case.

To review, a rising GSR means that speculative liquidity is coming out of the markets, as in risk ‘OFF’.  The rise in USD is a fundamental consideration that would hit manufacturing first.  Here again, I tell you that the biiwii guy, a former manufacturing person, was the first to project coming US manufacturing strength for NFTRH subscribers.  Just to counter a few wise guys who would finger point and yell ‘perma bear!’  Today’s firm bulls were all hiding under rocks as Congress did the Fiscal Cliff Kabuki Dance at the time.

To put things in non-technical terms, I think some shit’s happenin’ out there folks.  We’ll see.

gsr.uup

Intel Mobile Chip Buzz

Reference back to the beginning of the year when the stock was highlighted by NFTRH+ as a would-be technical breakout play (had not yet broken through 10 14 year old resistance) technically with a target of 40+, and fundamentally due to projected inroads into the mobile space for the chip dinosaur.  Well, Intel broke out on increased corporate demand for its PC chips.  At that time it was noted that mobile is still “out there” (doing my best Agent Mulder).

Well now the buzz is coming in for Core M Broadwell, and it is good stuff.  I sold half my position but still hold the other half, hopefully for target and beyond.  Here’s the original NFTRH+ chart…

intc

CDNX @ the Limit

Another commodity related marker that is testing important support is the TSX-V AKA the dot.VEE AKA the the Venture AKA the CDNX AKA the wild west outpost of Canadian speculation.

cdnx

We have been following this one every week in NFTRH and also on occasion its ratio to its daddy, the Toronto exchange, which has been flying around in blue sky nominally.  TSX includes mostly real companies and many that are not involved in energy, mining or other commodities.  You can see the message that has been in play since the last great commodity speculation blew out with silver in early 2011.

cdnx.tsx

This chart is like a junk vs. quality credit spread only for not only Canadian stocks but also for inflationary effects and resulting speculation.  Not happening.

If there is to be an inflation trade it a) has given no indication of happening and b) better get started soon.

Gold vs. SPX

While we have been charting a constructive gold vs. commodities big picture view, we have also kept track of a disgusting gold vs. SPX big picture view as gold has been “boxed in” as it grinds around looking to close the gap from 2007.  That was the kickoff to the financial crisis as the first institutions began melting down.

gold.spx

This cycle really has done amazing work in repairing (some, including myself would say sweeping under the rug) the damage and resetting the gold bug psyche as well.  It is important to remember that gold bugs were the kings of everything back then, with their ideology unquestioned.  But these are the markets and they don’t care about egos.  Actually yes they do, they care about crushing inflated ones.  The job appears to be in its final stages.

Macro Geek Alert…

People need to ask questions like ‘what, if anything are the implications of a declining BKX-SPX ratio?’ because this ratio, which has had us prepared for some bearish stuff since early 2014, remains bearish.

bkx.spx

NFTRH was on the first two lower highs in real time and now the ratio has gone on to establish a beautiful bear trend.  It’s only a daily chart, but the weekly is trend DOWN as well.  There is no positive divergence for the stock market here.

Apparently the carry trade idea (based on the tapering of QE’s bond purchases, which would theoretically benefit the banks by pressuring long-term yields upward while ZIRP is maintained by Fed Funds) has run out of steam.  Here again is the very notable reversal in lending activity, in line with the drop in long-term yields (makes sense).

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Update on Email Issue

Dear 3-5 subscribers who may not have not received NFTRH 300.  It appears to be a problem with your Optonline per…

Google tried to deliver your message, but it was rejected by the server for the recipient domain optonline.net by mx2.optonline.net. [167.206.4.79].

The same also happened when I tried to contact you using the ‘gt’ address using a Comcast SMTP.

Please contact Optonline regarding this issue.  I can receive mail from you so pop me a note with any info you get.  Thank you!

Attn: Subscribers Who Have Not Received NFTRH 300

[edit]  Dear TM: I am receiving your emails and have mailed you from 2 different accounts.  I’ll try a 3rd.  Meanwhile, do you have an alternate email that I could use?  Thank you.  Also, the address I mail from begins with ‘NFTRH1′, not ‘NFTRH’ as you noted in your mail.  Try white listing that.

There may only be one of you now, but one is too many.  If you have not received #300 there is apparently a problem on your end with spam filtering.  Please let me know if you have not received and indeed, if you have received #300 as of this latest mailing.  Thank you.