PM Daily Market Commentary - 4/12/2018

By davefairtex on Fri, Apr 13, 2018 - 2:25am

Gold plunged -19.30 [-1.42%] to 1337.50 on heavy volume, while silver dropped -0.23 [-1.35%] to 16.45 on very heavy volume. The buck moved up +0.21%, but that minor rally didn't explain the plunge in the metals today.  That I ascribe to Trump backing away from an imminent strike on Syria.

Gold sold off all day long, ending the day near the lows. Candle print was a swing high (52% bearish reversal), and the forecaster agreed, dropping -0.76 to -0.17, which is a sell signal for gold. It is dangerous to chase safe haven moves; if disaster doesn't strike, then the safe haven move gets unwound in a hurry.

COMEX GC open interest fell -15,770 contracts. Almost half of yesterday's big build was unwound today. Someone just made a quick $50 million dollars.

Rate rise chances (June 2018) rose to 95%.

Silver's drop was a bit shallower than gold; it too printed a swing high (58% reversal), and silver's forecaster dropped -0.41 to -0.28, which is a sell signal for silver too.

COMEX SI open interest fell by -3,714 contracts today.

The gold/silver ratio fell -0.06 to 81.33. That's slightly bullish.

Miners fell, with GDX down -1.23% on moderate volume, and GDXJ off -1.56% on moderately heavy volume. Miners did fairly well given the big drop in gold, although GDXJ printed a swing high (58% bearish reversal). XAU forecaster dropped -0.17 to +0.19; XAU remains in an uptrend. On the chart, it appeared as though the miners found support right at yesterday's breakout point, which is a fairly bullish look.

Today, the GDXJ:GDX ratio fell, but the GDX:$GOLD ratio rose. Call it neutral.

Platinum fell -0.40%, palladium rose +0.26%, while copper plunged -1.65%. That's a swing high for copper (58% bearish reversal) as well as a forecaster sell signal. Platinum is still clinging to an uptrend, and palladium is doing a bit better than that.

The buck moved up +0.19 [+0.21%] to 89.38. Candle print was a swing low (57% bullish reversal), but the forecaster moved up just +0.09 to -0.24. The buck remains in a downtrend.

Crude moved up +0.40 [+0.60%] to 67.07. There appeared to be a fair amount of selling pressure, but crude managed to close fairly conclusively above its breakout point. Reduced trade-war concerns, geopolitics, Venezuela's declining production, missile strikes on Saudi Arabia, it all added up to a continuing move higher for crude.

SPX rose +21.80 [+0.83%] to 2663.99. The spinning top candle print was a bullish continuation; SPX forecaster rose +0.02 to +0.30, which says SPX remains in an uptrend. Financials led (XLF:+1.75%) along with industrials (XLI:+1.44%), while utilities trailed (XLU:-1.32%). This is a bullish configuration.

VIX plunged -1.75 to 18.49.

TLT plunged -0.73%, printing a swing high (47% bearish reversal). TY confirms, dropping -0.37% and printing a swing high also (51% bearish reversal), with the TY forecaster plunging -0.52 to -0.47, which is a sell signal for TY. That's a lower high & lower low for TY. Bonds are back to looking bearish. 10-year treasury closed at 2.83%.

JNK shot higher, up +0.39%, making a new high. Forecaster rallied +0.19 to +0.83, which is a strong uptrend for JNK.

CRB rose +0.24%. Only 2 of 5 sectors rose, led by livestock (+2.34%).

Today looked like a safe haven unwind to me.  Gold fell more than both silver and the mining shares.  It is interesting and possibly bullish that the miners avoided a sell signal today.

Equities are back into an uptrend, along with crude and junk debt.  Bonds are once again looking weak.

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