PM Daily Market Commentary - 7/13/2017

davefairtex
By davefairtex on Fri, Jul 14, 2017 - 6:47am

Gold fell -3.00 to 1216.70 on heavy volume, while silver fell -0.22 to 15.66 on moderate volume. While gold started fading a bit during the London session, silver started its plunge just after 930 am, as Yellen testified before Congress once more – this time before the Senate.  Proximate cause or just coincidence?  I don't know.  Copper started selling off at about 9:20, so maybe that contributed to silver's fall.

Gold tried moving higher after yesterday's rally, but it ran into resistance in Asia, and finally ended up starting downhill during the London session.  Really, not much happened though - the trading range was fairly narrow, and the decline was quite modest. Since gold did not make a new high or a new low, the candle code had nothing to say about the day's price moves. The forecaster actually ticked higher, up +0.07 to a mildly bullish +0.22. Since the buck mostly did not move today – perhaps this was just a day of rest for gold. Certainly, it looked a whole lot better than silver. Gold remains below its 9 EMA.

Open interest at COMEX for GC fell -2,651 contracts.

Rate rise chances (Dec 2017) remain at 47%.

While gold started fading at around 7am, silver waited until 9:30 am before dropping off a minor cliff, and the selling didn't stop until the market closed, with silver closing at the lows for the day. Candle print on the day was a closing black marubozu/swing high – but the candle code felt the print was just neutral, not bearish. The forecaster dropped -0.08 points, pulling silver back into bearish territory by a slim margin. Silver remains below its 9 EMA.  It all looks unpleasant, but the code wasn't impressed.

Open interest at COMEX for SI fell -1,864 contracts.

The gold/silver ratio rose +0.91 to 77.69. That's bearish.

Miners sold off today, with GDX down -1.10% on moderately light volume, while GDXJ dropped -1.29% on very light volume. Its another day of selling for the miners. Both miner ETFs printed swing highs, which the candle code found to be neutral rather than bearish. Both patterns looked a bit scary to me, but the code says not to worry. We'll see how that works out tomorrow. The GDX forecaster dropped -0.10 points to bring its rating to dead neutral. GDXJ dropped into bearish territory.

The GDXJ:GDX ratio fell, as did the GDX:$GOLD ratio. That's bearish.

Platinum fell -1.39%, palladium fell -0.74%, and copper dropped -0.62% - all three “other” metals mostly unwinding yesterday's bullish moves. Only one bearish print, however: palladium's dark cloud cover, which has a 47% chance of marking the top.

The buck was mostly unchanged, dropping -0.01 to 95.47. There was a fair amount of movement, but the neutral ending resulted in a long-legged doji candle print, which was seen as slightly bullish by the code. Dollar forecaster was unchanged, and remains in bearish territory.

Crude recovered from yesterday's sell-off, rising +0.66 to 46.21. This was a surprising outcome to me: usually if crude sells off after an EIA report, we end up seeing more down days for the remainder of the week. Instead, crude recovered nicely and made a new closing high for this cycle. Candle print was just a long white candle, which the code found neutral. Forecaster moved solidly into bullish territory, up +0.49 to +0.50. Crude remains above its 9 EMA.

SPX moved slightly higher, up +4.58 to 2447.83.

VIX fell -0.40 to 9.90. We're back in single digits for VIX once more. Puts are super cheap once more.

TLT fell -0.63%, unwinding almost all of yesterday's gains. While the candle code didn't find the collection of candle patterns bearish, the forecaster wasn't nearly as happy, dropping -0.27 down to a barely-bullish +0.12 rating.

JNK rose +0.08%, creeping higher to close right at its 50 MA. While JNK has recovered nicely in the last few days, it remains in a downtrend. It really needs another 0.5% move in order to prove that the downtrend is over.

CRB rose +0.27% - still recovering slowly off the lows. Only 2 of 5 groups rose today, but the leader was energy, which did fairly well.

Well it won't be one of those simple rebounds, I guess. Silver and the miners look as though they aren't quite ready to rally just yet.  Candle code isn't suggesting some big bearish event though, so we could still end up seeing some back-and-forth action until a rebound occurs – that's what happened back at the start of 2016. However, until silver and the miners start acting better, which to me means “those pesky commercials decide to start buying in earnest”, it looks as though we don't get our rally.

I'm still focused on that COT report from last week. It remains quite bullish for silver. That's helping me to buy into the candle code "ho hum" reaction to today's price moves.

Of course that COT report can get even more bullish if prices bounces lower for another week. That's always a possibility too.

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6 Comments

Cold Rain's picture
Cold Rain
Status: Gold Member (Offline)
Joined: Jul 26 2016
Posts: 287
Reversal Time Guesses?

Very nice move up today in PMs.  What time does the reversal start?  I'm guessing 11:00 AMish.

Cold Rain's picture
Cold Rain
Status: Gold Member (Offline)
Joined: Jul 26 2016
Posts: 287
Close

Man, I was really close on that one. cool

PeakGold's picture
PeakGold
Status: Bronze Member (Offline)
Joined: Jun 3 2017
Posts: 70
That was close!This is my

That was close!

This is my prediction for silver into early next week... Failed breach of $16.00 by the end of trading day today, leading to a drop to $15.80 Sunday through Monday morning, then a successful breach through $16.00, leading to a great long trading day on Monday!

http://i.imgur.com/9PbuM6R.png

 

Cold Rain's picture
Cold Rain
Status: Gold Member (Offline)
Joined: Jul 26 2016
Posts: 287
Samsonite!

I was way off!

PeakGold's picture
PeakGold
Status: Bronze Member (Offline)
Joined: Jun 3 2017
Posts: 70
Well at 11 there was a change

Well at 11 there was a change in direction. The price went up, then it went down, and then at 11 it started to go back up again so, I'd say you sniped it. Right on target! lol

Cold Rain's picture
Cold Rain
Status: Gold Member (Offline)
Joined: Jul 26 2016
Posts: 287
Good point
PeakGold wrote:

Well at 11 there was a change in direction. The price went up, then it went down, and then at 11 it started to go back up again so, I'd say you sniped it. Right on target! lol

Thats a good point.  I was semi in the ballpark. :)

Have a good weekend!

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