PM Daily Market Commentary - 3/30/2017

davefairtex
By davefairtex on Fri, Mar 31, 2017 - 2:24am

 

Gold plunged -11.50 to 1244.80 on moderate volume, while silver fell -0.12 to 18.14 on moderate volume also. A third strong day for the buck didn't do gold any favors.

 

Gold's plunge today took gold through its 9 EMA.  Candle print was a black marubozu/confirmed bearish NR7, which has a 38% chance of marking a top. Gold also printed a swing high. This flurry of bearish activity suggests that gold may well have topped out here.  It looks as though the 200 MA marked the upper extent of the gold rally once again.

Open interest at COMEX for GC fell -11,635.

Rate rise chances (June 2017) remained at 54%.

Silver also fell, but less strongly than gold. Silver's candle print was just a long black candle, the candle code felt the print was neutral, and silver remains above all three moving averages. Silver has yet to print a swing high.  Silver remains in an uptrend.

The gold/silver ratio fell -0.16 to 68.64.

Miners fell alongside gold, with GDX down -1.57% on moderately light volume, while GDXJ dropped just -1.24% on light volume.  GDX closed at the dead lows for the day, and also made a new low.  Candle print for GDX was a closing black marubozu, which the code felt was bearish. GDXJ printed a doji, which was neutral. Given that gold dropped -0.92% today, the damage in the miners was far less than I had expected, especially in the juniors. Make no mistake, however, miners remain in a downtrend. There is not a hint of bullish behavior to be seen.

Platinum fell -0.65%, palladium rose +0.60%, while copper climbed +0.15%. Copper printed a doji with a long upper shadow – which looks like a failed rally, and is somewhat bearish. Palladium is not far from its highs, while platinum made a new low and is in a downtrend. Its a mixed bag for the metals.

The buck rallied for the third straight day, up +0.45 to 100.28. The buck is now conclusively above its 9 EMA, with the next stop being the 50 MA. Mostly this strength has come at the expense of the Euro, which was off -0.82% just today, and has dropped more than 2 full points in the past 3 days. Interestingly, gold-in-Euros remains in an uptrend; no swing high, no close through the 9 EMA.  Gold's downtrend is just a currency effect.

Crude rose again today, up +0.73 to 50.33, back up above 50 for the first time in 3 weeks. Candle print is a long white candle, which the code finds to be bullish. Here's a fun news article that encourages me to apply an extra layer on my crude oil market tinfoil hat:

http://oilprice.com/Energy/Crude-Oil/Mysterious-Outage-In-Libya-Could-Drive-Oil-Prices-Higher.html

Mysterious indeed. Who benefits? A hefty bribe in the right place could well have turned the spigot off. 140K barrels per day, just gone. Price loves it; volume is accelerating as price rises, the chart is looking strong.

Longer term, the fracklog in the US (drilled but uncompleted wells) is large and growing. Companies often must drill within 3 years or lose their drilling rights. They don't need to complete the wells, just drill them. Currently, the number stands at 5600 wells. That is a lot of oil production that could come onstream relatively rapidly. Libya giveth, and shale taketh away - but today, Libya is winning.

http://oilprice.com/Energy/Energy-General/Huge-300000-Bpd-Fracklog-Could-Derail-Oil-Price-Recovery.html

SPX moved higher today, closing up +6.93 to 2368.06. Candle print was a long white/confirmed bullish NR7, which the code found to be bullish. Price is now more convincingly above the 9 EMA.  Financials (XLF:+1.31%) recovered from yesterday's swoon and led the market higher, while utilities trailed (XLU:-0.78%). In spite of today's rally, financials are still not looking all that healthy. They have been underperforming the overall market for about a month, and they still have not yet recovered their losses.

VIX rose +0.12 to 11.54.

TLT fell -0.81%, negating yesterday's bullish harami, making a new low, and dropping just below the 9 EMA. Bonds are starting to look unhealthy again.  Both bonds and gold, actually.

JNK shot higher today, shrugging off yesterday's bearish hint, rising +0.52% and easily clearing the 50 MA. JNK has confirmed a (bullish) double bottom pattern by today's move, and is now clearly back to an uptrend. That's risk on.

CRB rose just +0.17%; energy and industrial metals rose, while agriculture and PM fell. CRB is struggling to move higher.

The weak Euro is now causing more serious problems for gold. The fall in gold over the last few days is just a currency effect, but it still doesn't feel so good if you live in dollar-land. The gold-in-euros price chart still shows gold in an uptrend; no swing high, no EMA crossing. Miners haven't collapsed the way I had feared, which I take as a positive sign, but now both gold and the miners are in downtrends, with silver the lone holdout.  Platinum looks weak too - more like the miners than gold.

If the dollar continues rallying, that will probably be gold-negative.  That's a story you've heard before, and that's where we are once again.

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4 Comments

lambertad's picture
lambertad
Status: Silver Member (Offline)
Joined: Aug 31 2013
Posts: 184
Orbital Insights interview

Dave, 

A couple weeks ago I mentioned a RealVision interview with Orbital insights CEO James Crawford on AI and satellite imagery. Turns out RealVision has a free podcast I just found featuring Grant Williams, Rao Paul and another guy and I found part of the interview with James. Here's a link to the podcast, the interview with James starts at 13:28

 

cmartenson's picture
cmartenson
Status: Diamond Member (Offline)
Joined: Jun 7 2007
Posts: 5971
Fun fact
lambertad wrote:

Dave, 

A couple weeks ago I mentioned a RealVision interview with Orbital insights CEO James Crawford on AI and satellite imagery. Turns out RealVision has a free podcast I just found featuring Grant Williams, Rao Paul and another guy and I found part of the interview with James. Here's a link to the podcast, the interview with James starts at 13:28

I am finally in late-stage discussions with Realvision to be on their program.  Shooting for April 12th...let's hope it comes to pass! 

I really like what they do and how they do it.

lambertad's picture
lambertad
Status: Silver Member (Offline)
Joined: Aug 31 2013
Posts: 184
RealVisionTV or podcast

Chris, 

Just curious if you're doing a RVTV interview or their podcast. Either way will be great, but RVTV interviews with Grant are like nothing else. 

Adam Taggart's picture
Adam Taggart
Status: Peak Prosperity Co-founder (Offline)
Joined: May 26 2009
Posts: 3211
RVTV

Chris will be on the TV production :)

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