PM Daily Market Commentary – 4/21/2014
Gold closed off -4.30 to 1290.30 on moderate volume – silver was down -0.21 also on moderate volume. Gold was hammered early in asia trading hitting 1281.60 at one point, but it then rallied steadily into the close in NY. Silver was hammered harder in asia, and recovered a bit less well. This pushed the gold/silver ratio up near the cycle high, to 66.37. Silver looks weak, but this time we can't blame copper, which is hanging on near 3.05.
The dollar rose +0.09 to 80.04 – it has been mostly a bystander in terms of PM, not affecting gold or silver one way or the other.
GDX was hit early and broke below support selling off relatively hard, but then it found buyers, rallied into the close and eventually closed down just -0.25% on moderate volume. GDXJ looked even better – it also made new lows, but rallied halfway through the trading session to close up +0.52% on heavy volume.
This is actually a reasonably bullish micro-picture in the context of a downtrend. GDXJ led GDX, GDX managed to avoid a breakdown once it broke support, and GDXJ printed a hammer candle on some pretty good volume. These are bullish signals. We await tomorrow's move in GDXJ. If it rallies above today's high, that would be a confirmed reversal signal for GDXJ.
SPX moved up +7 to 1872, just a few points away from the previous high set back on April 10. A close above the previous high would, from a chart standpoint, invalidate the pattern of "lower highs and lower lows" (a bearish chart picture for SPX) and for that reason I think it will likely prove irresistable to the big guys playing games with stop-gunning. In other words, we'll probably pop higher at some point soon just to hose the SPX shorts and force them all to cover at a loss. Games are played in just about every market – not only gold.
GDXJ's performance today (if confirmed tomorrow) may lead to something good.
I read where JPMorgan Chase, Deutsche Bank, Morgan Stanley and now Barclays are SOMEWHAT leaving the Commodity business and that Mercuria and Glencore Xstrata, are buying up their businesses, while Chartered and Macquarie are expanding the their commodity business.
And here at PP.com there seems to be the idea that we are due to a 50% stock drop soon.
How in the world does one make decisions what to do about all this? Buy or not buy and which? Will the first three, allow the gold/silver market start upwards? Or, will the 3rd through 6th take up the slack and keep gold/silver in its seemingly steady downturn?
What to do? Any thoughts here in this wonderful community of interested folks??