Well, of course change is coming to the macro markets. It has come every day since the beginning of time and today is different than yesterday. But I mean a change in the market’s character is likely coming in 2015.
NFTRH notes the divergent Horsemen, Gold-Silver Ratio and USD, and also cryptically notes that people need to have the proper market interpretations at the ready in 2015. It was just 6 months ago that we started managing a bounce in the roundly reviled USD in NFTRH. Now look at it, everybody’s bullish the buck.
The stock market is down big today. Oooh, that’s scary, eh? Well no, not until it breaks some parameters. Interestingly, some of my non-gold stocks are very green today. I think (think, mind you) that the market is just cleaning out the pipes as sentiment got over bullish again over the holidays. Those gaps need filling, after all.
But if and when it does go bearish for real I’ll plan to short this pig with conviction. Right now the only thing I am short is junk bonds and that is working well. I find it really interesting that everything is down in the face of the strong dollar but the precious metals. That is exactly according to NFTRH’s plan on the big picture. Exactly. In the near or intermediate-terms, other things can and will happen. But today is a microcosm of what I’d expect the big picture to look like under a strong dollar regime.
Meanwhile, the Gold-Silver ratio says Uncle Buck may be readying to take a break. It’s either that or the GSR will get back in gear and croak everything. I think the former may be in play.
Today the 2 Horsemen rode newly brave bulls back out of town.
The news driven short covering rally yesterday was impressive and now momo’s are being punished. Makes sense.
Continue reading NFTRH; USD & Other Indicators
Today is the kind of day when you’d do well to tune out any cartoon characters ranting about any sort of manipulation. The simple fact is that the 2 Horsemen, the gold-silver ratio and the US dollar (GLD-SLV & UUP) are riding together today in opposition to most asset markets. Period.
Well, here came the short covering rally in the precious metals. By calling it that I don’t mean that it cannot turn into something more, but today was most assuredly driven by short covering as the US dollar unwound some of its speculative sponsorship. One can assume that large speculators took it on the chin on both ends, in the USD and in gold/silver as the Commercial traders had been aligned increasingly bearish and bullish, respectively.
Continue reading NFTRH; Multi-Market Update
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.
The first draft is me on Saturday fighting my way through piles of macro stuff, charts and personal observations, opinions and conclusions. A review on Sunday morning let’s me sit back, try to figure out where I may be confusing people, sounding like a pompous ass or who knows what else is not in the best interest of the work? It let’s me make the report presentable. Anyway, here’s one whacky macro chart from #309.
I love these crazy ones with different colors and mark ups. Note how the 6’s are the only numbers that are the same color on the correlation of the gold-silver ratio (GSR) and the S&P 500. It’s something we noted months ago, but it could be relevant going forward now that the USD is getting in correlation with the GSR.
There are a lot of things in play today, including a notable rise in the gold-silver ratio concurrent with USD (finally, these two are both working together, which would be a component of our favored macro plan for future economic contraction, stock market troubles, etc.). But the point of this update is to further the point we made last week about the Emerging Markets’ potential breakdown nominally and in relation to the US market.
Continue reading NFTRH; EM’s vs. SPY, GSR, USD, etc…
The Gold Silver ratio (GLD-SLV) is turning up hard today, as silver drops per the wedge in last night’s post and gold just hangs around. This looks like a definitive move in the GSR, which would go along with a corrective environment in asset markets as the “metallic credit spread” rises.
The Gold Silver ratio is acting perfectly today… to NFTRH’s plan at least.