I have not even read the interview before starting this post. By the end of the post I will have read it and I assume, taken issue with at least some of it.
The very term “Resource Sector” is something that bothered me going back to the ‘inflation bull’ market of 2003-2008. Back then I used to grouse about the gold is silver is copper is tin is oil is hogs crowd always lumping ‘resources’ together as if they are anywhere near the same thing. They are not; they are vastly different, with most ‘resources’ being economically cyclical while gold is counter cyclical.
Sure, sometimes when the inflation tout is going good it all goes up. But there is no resources sector as a discrete and unified asset class. So my conclusion was that anyone pitching “the metals” as many used to often do (gold and industrial metals all in the same analysis) is either just lazy or a ‘resource sector’ pitch man or woman. There were tons of ‘em in 2003-2008.
Anyway, on to Casey here…
L: Well, Doug, we’ve seen another quarter of high volatility and significant world events. What strikes you as most important at present?
Doug: Everything is still held together with chewing gum and baling wire, for which I’m grateful, considering what’s coming. It’s very clear to me that the global economy is in very much the same space as it was in 2007—in other words, on the edge of a precipice.
So buy resources! Wasn’t that a solution from many corners of the fear trade into the 2008 top when resources of all kinds eventually crashed as bad or worse than the stock market?
Continue reading Signs of a Resource Sector Bottom? Really?
Well, I just wrote 42 pages. I’m spent, so no big promo. I am personally enjoying the market for what it gives and having a good year so far. In that existing trends have not changed yet, the real fun however, begins at some future point.
April gold was lower overnight as it extends the decline off January’s high. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near-term. If April extends the aforementioned decline, the 62% retracement level of the November-January-rally crossing at 1199.50 is the next downside target. Closes above the 20-day moving average crossing at 1257.00 are needed to confirm that a short-term low has been posted. First resistance is the 10-day moving average crossing at 1231.80. Second resistance is the 20-day moving average crossing at 1257.00. First support is the 62% retracement level of the November-January-rally crossing at 1199.50. Second support is the 75% retracement level of the November-January-rally crossing at 1176.10.
March silver was slightly higher overnight as it consolidates some of Tuesday’s decline. Stochastics and the RSI remain neutral to bearish signaling that sideways to lower prices are possible near-term. If March extends the decline off January’s high, the reaction low crossing at 16.210 is the next downside target. Closes above the 20-day moving average crossing at 17.323 are needed to confirm that a short-term low has been posted. First resistance is the 20-day moving average crossing at 17.323. Second resistance is January’s high crossing at 18.505. First support is the reaction low crossing at 16.210. Second support is the reaction low crossing at 15.510.
March copper was mostly steady in quiet trading overnight. Stochastics and the RSI are neutral to bearish signaling that sideways to lower prices are possible near-term. Closes below the 20-day moving average crossing at 255.05 would temper the near-term friendly outlook. If March extends the rally off January’s low, the reaction high crossing at 279.40 is the next upside target. First resistance is the reaction high crossing at 264.20. Second resistance is the reaction high crossing at 279.40. First support is the 20-day moving average crossing at 255.05. Second support is January’s low crossing at 241.90.
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Guest Post by Adrian Ash
SILVER INVESTING sentiment amongst private individuals in the West fell near record lows at New Year 2015 as the metal’s strong price rally invited existing owners to sell, writes Adrian Ash at BullionVault.
That’s the conclusion of our new Silver Investor Index, launched today.
The metal’s 10% rise during January saw more private investors sell silver using BullionVault than any month since summer 2011, very nearly equaling the number who chose to buy silver VAT-free at live spot prices on the world-leading precious metals exchange online.
That put BullionVault’s new Silver Investor Index – a companion to our widely-cited Gold Investor Index launched in 2012 – near the series low hit when silver sellers outnumbered buyers in June 2014.
Five years since BullionVault first made silver trading and storage available online, it has become a leading provider of silver bullion to private investors online, now caring for 502 tonnes on their behalf – all securely vaulted in the user’s choice of London, Singapore, Toronto and Zurich.
Continue reading Silver Investing Grows, But Sellers Jump 83%
How to promo… how to promo? NFTRH 329 took a hard look at the realities of what happened last week and despite an end of week reversal (below SPX key resistance of 2165) it found that at week’s end the bulls and the risk ‘ON’ contingent regained their footing.
Going the other way, the rise in short-term yields vs. long-term yields was gold bearish and not friendly to Team Risk ‘OFF’.
A really good market report doing the work it has to do every step of the way. Of course we are in the volatile ‘swing baby, swing’ market so we’ll be ready to adjust as always over the coming week. The key is to be in proper position for when the ‘swing’ phase consolidation ends.
Another solid report this week. I know that because it helped me out yet again in trying to understand all the components in play across markets; all the tops spinning around on the table.
Stock market sentiment is an issue as markets continue at an important technical decision point. The precious metals have short-term technical parameters but more importantly, they have some pretty important long-term signals coming in. Well, gold and even more so, gold miners. Silver is not something I am personally excited about on the big picture.
The biggest picture view, which has been an uninterrupted global economic contraction is intact and getting stronger. From that spring so many other items for extrapolation and strategy.
There is a lot happening across global financial markets. We go in depth into US stocks, review global stocks, make sharp points about commodities, cover macro indicators in depth and get very detailed on the precious metals. A relatively easy reading 38 pages (lots of graphics) and a clear focus.
Guest Post by the Fine Folks at NFTRH
With all the hype and noise built in to daily and weekly market management, sometimes it is worthwhile to dial out, calm things down and touch base with markets on the big picture. Here are views on various markets (with limited commentary) by way of some NFTRH monthly charts.
Let’s start with currencies, since they are a reflection upon global policy making, which has been unprecedented in its direct market interference over the last few years.
Nominal Charts – Currency
We noted the hot air patch in the Canada dollar last year. I had thought CDW might stop and find support at 85, which is a measurement from the topping pattern; but so far, no dice.
Fellow commodity currency Aussie is at what should be a strong support zone.
 evidently my uninformed use of stockcharts.com’s symbol for the Rupee is incorrect. I have had input that this chart is an inverted view of Rupee-USD. Looking into this.
Continue reading Big Picture View
The last post was a little perspective on gold over the long-term. This post calls attention to a post at NFTRH where the writer pops off a bit on the gold bears in light of today’s… what ever it is. Festivities?
I would normally be pretty cautious about a short-covering event like this, but coming off of a gold-negative hype event as it did, driving silver down to the low-end depths of my 14-16 target in pre-market, I find it notable.
Anyway, the post linked above goes into the need to use not only technicals in the gold sector, but importantly sector and macro fundamentals along with other indicators. You don’t friggin’ chart in a vacuum! Especially in the precious metals.
I swear this sector is filled with hyperbole both from the Pom Pom brigade and their evil twins managing what has become an ‘everybody knows’ situation with respect to how bearish gold is. Just ask that weirdo, Willem Buiter over at Citi.
Guest Post by EWI
Don’t Get Ruined by These 10 Popular Investment Myths (Part IX)
Interest rates, oil prices, earnings, GDP, wars, peace, terrorism, inflation, monetary policy, etc. — NONE have a reliable effect on the stock market
You may remember that after the 2008-2009 crash, many called into question traditional economic models. Why did they fail?
And more importantly, will they warn us of a new approaching doomsday, should there be one?
This series gives you a well-researched answer. Here is Part IX; come back soon for Part X.
Myth #9: Inflation makes gold and silver go up.
By Robert Prechter (excerpted from the monthly Elliott Wave Theorist; published since 1979)
This one seems like a no-brainer. The government or the central bank prints more bonds, notes and bills, and prices for things go up in response. Gold is real money, so it must fluctuate along with the inflation rate.
Continue reading Myth #9: Inflation Makes Gold and Silver Go Up