Triple bottom forming with support at $1200, from July 14, Jan 14, Oct 14. US$ index has been rising parabolically recently, overdue for retracement.
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Triple bottom forming with support at $1200, from July 14, Jan 14, Oct 14. US$ index has been rising parabolically recently, overdue for retracement.
An interesting view on the gold price.
http://www.bloombergview.com/article...ow-can-gold-go
Triple bottom in 1180's.....present 1218oz (1384oz AUD) may it continue ....I think it will...
I think the markets are all over the shop at the moment. Makes for great trading opportunities, however I would suggest there is an air of confusion.
The sharp rally in the USD has caught many on the hop & now there is a concern that it will hurt US corporate earnings which in my mind there is very little doubt.
Equity markets have been seeing fairly large swings from just piping record highs to dropping several percent.
The Russell 2000 was down 10% until last night's Fed inspired rally!
The USD is taking a breather, but where does money that has flowed back to the US or USD at least, now sit & earn a buck?
Certainly not in cash unless you are willing to accept 0% & perhaps they should, however a lot wont.
Do you enter equity markets at or around record levels? Corporate earnings are forecast to weaken & there is a strengthening political will to clamp down on international corporates who have been dodging tax & may even backdate tax claims 10 years or more in Ireland. (not sure the market has priced any of this tax issue to be fair)
So what is one to do with all that idle cash?
There is one outcome that no one seems to be pricing.
Some of that money flows back to where it came from & the yield play comes back, even short term.
Its a difficult choice when you have seen the exchange rate whacked 10% or so.
Do you risk more of that chasing 3%? And you are at the mercy of the Fed.
Personally I think we are going to see some very poor decisions made as that's what happens when money is free & everyone is looking to make a buck.
One sector that has been totally unloved is gold & gold miners.
Any increase in investment interest in gold from the West would see gold miners rocket.
I know I'm biased, however when money is looking for a home do you look to stick a small portion in an unloved area of the market?
Who knows, obviously the likes of Goldman Sachs don't think so, but then their wagon is firmly hitched to the equity train.
Interesting times to say the least!
I'm going to write to Janet Yellen and nominate Daytr for the FOMC, he's way too smart to be convincing gullible goldbugs to load up with goldies, in a hick place like the Bay of Islands.
Washington DC's the place for him.
Well it didn't take long before all the gains in equity markets generated by the Fed speak were completely wiped out. Equities were smashed & oil to plummeted with Brent under $90 this morning on an outlook of weak global demand & building production. We could still se lower oil, but we are approaching the cost of production for fracking & shale production in North America which I believe is somewhere north of $70/bbl. OPEC could also perhaps cut production.
Surely equities should be doing well, cheaper energy & zero interest rates. Well they would be the case if they weren't already over valued & the outlook for Western growth dismal. Germany, one of the brighter spots of Europe has had a 5% drop in exports & similar in manufacturing.
What no one is talking about as none dare accuse the US of furthering their own interests at the expense of others!
Russian sanctions are hurting Europe as they would. Russia has diverted its trade to China & demand from that quarter from the West is being satisfied some by Russia, particularly energy. Russian & Chinese relations have never been so good as they have one common denominator, their dislike of US total dominance over anything & everything.
With all that money rushing back to the States & no where to put it gold is benefitting some. If it starts to stand out, it will gain a lot more. There is huge amounts of cash sloshing about looking for a home. Could the unloved area of gold & gold stocks attract some of that. Very possible & perhaps even probable imo.
US stock market looking sick earlier in the week (been looking scarey for a while)--Yellen makes her speech--Dow makes biggest gain of the year--1 day later-Dow makes its biggest loss of the year----UH OH
US furthering their interest at the expense of others...whats new
For those who have not yet realized ''interest''means the 1%=Corporations and super rich
A plunge in the gold indices overnight, over 6% for one of them.
Gold up, Aussie down. A$1420 gold happy days! Stock markets getting trashed & gold has benefitted & I very much think the spec market in gold is still short! US equity markets have looked dodgy since July imo & we are now again seeing a sharp correction.
Money gets sucked in just to get thumped. At some point there wont be anymore suckers to be drawn in & that's when we see a much deeper correction of 20% or so.
From Bank of America.
Similar view to what I hold. A break of $1240 should see further short covering.
Precious Metals: A firm start to the week was led by a familiar pattern of Asian buying – a combination of a surge in Chinese exports and stop-losses taking gold within a whisker of 1240. The market is approaching some interesting levels to the topside now and expectations are that large stops are placed above these points. One of the recurring themes this year has been the unraveling of positioning in the gold market, so if that were to happen again (and we know from CFTC data that the market is leaning short still) it will be pretty much business as usual. The market needs further impetus to push higher, and it appears that the continued sell-off in the stock markets have been very helpful in that regard and another leg lower there should send gold into another stop-loss frenzy.