PM Daily Market Commentary – 12/22/2015
Gold fell -5.90 to 1071.80 on light volume, while silver rose +0.01 to 14.25 on moderate volume. Gold fell, and silver lost its gains right around 08:30, the time of the 3Q GDP report which showed a revised 2.0% annualized growth rate.
Even though the dollar fell today, gold looked weak and was unable to rally. Still, gold remains above its 9 EMA; if gold can remain above this moving average, we will eventually see a breakout above the previous high at 1088.30 which would confirm the double bottom. The light volume today suggests that a good chunk of the market is already on vacation right now. Perhaps those were the buyers, who can say.
Silver rallied intraday, hitting 14.40 just before that 08:30 GDP release; after that report was released, silver immediately sold off, declining for the rest of the day, printing an unfortunate-looking almost-gravestone doji which marks the failed rally. Still, like gold, silver remains above its 9 EMA, which is a positive sign. A close above 14.64 is the next step in silver's recovery process.
GDX fell -0.58 on light volume, while GDXJ fell -0.36% on light volume also. Senior miners were unable to break the downtrend line today, and today's decline took the miners below its 9 EMA, which is bearish. GDX really needs to break that downtrend line. Holiday trading volume remains light.
The buck continued to fall today, losing -0.22 to 98.24. The buck has now unwound all the gains post-FOMC. A drop below the 50 MA, which is not far at 97.98, will signal a more serious decline for the dollar may be under way.
SPX rallied again today, climbing +17.82 and closing just above its 9 EMA. SPX remains well below its previous low of about 2080, but the expectation is for the usual December front-running of the annual January 1st dump of new pension & 401k money generally encourages the market to move higher around now. That is likely to provide a boost to equities, absent something truly unpleasant. VIX fell -2.10 to 16.60.
JNK confirms the risk-on feeling, rising +0.86%, a big move for junky debt.
Bond ETF TLT fell -0.72%; bonds are starting to feel pressure probably because of rising equity prices.
CRB dropped -0.27%. I guess a two-day commodity rally is all we can expect these days.
WTIC rose +0.69 to 36.47 today; depending on how you chart things, that marks a swing low for crude. Brent wasn't so fortunate, closing up +0.12 to 36.36, the first time I've seen Brent below WTIC in a couple of years. Crude got a boost at 16:30 by an API report that showed oil inventories fell by 3.6 million barrels this week. Hopefully the Petroleum Status report tomorrow at 10:30 will agree, and this will mark at least a short term low for crude. Next step for crude is a crossing of the 9 EMA at 36.55, which is not so very far away.
US Natural gas ($NATGAS) fell -0.02 [-1.24%]; after yesterday's massive rally, some selling is expected.
Its holiday season, which makes for lighter-than-normal volume and (usually) less price volatility. That's partially why the VIX dropped so dramatically today. Nobody buys crash insurance when most of the traders are on holiday.
I believe PM will probably also follow this path, with not much happening until we are closer to New Years.
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Egon von Greyerz who stores gold for rich people. (Starts at $1/4 Mill ) says that his clients are not too fussed about gold. There is just too much easy money to be made on the stock market and they have got lazy.
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