Today’s date: 2020-10-19

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  • Tue, Oct 20, 2020 - 04:54am

    #1

    davefairtex

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    Today’s date: 2020-10-19

Gold climbed +3.97 [+0.21%] to 1912.03 on moderately light volume, while silver rallied +0.27 [+1.11%] to 24.59 on moderately light volume also. The buck fell [-0.27%], SPX dropped hard [-1.63%], crude moved lower too [-0.19%], and bonds were mostly unchanged [the 10-Year yield rose +1.0 bp].

Gold tried to rally during Asia and London, but the rally largely failed. The spinning top candle was neutral, and forecaster climbed, but remains in a downtrend. Gold is still in a downtrend in both the daily and weekly timeframes.

Gold/euros dropped -5.18 [-0.32%] to 1623.27 on moderately light volume. The short white candle was a bearish continuation, forecaster climbed, rising into an uptrend. Gold/euros is in an uptrend in the daily and weekly timeframes.

COMEX GC open interest rose +4.4K contracts. Current open interest for GC: 52% of global annual production, up +0.41% today. 21 GC contracts stood for delivery at COMEX today.

In spite of a decline in the buck, gold staged a failed rally today. That’s not that’s not a good sign. Still, the candle print wasn’t specifically bearish, and forecaster thought it was at least somewhat bullish. Gold remains below the 9 MA, and in a mild downtrend.

Silver followed a similar pattern intraday; a late Asia/early London rally, which had mostly failed by end of day. The spinning top candle was a bullish continuation, forecaster climbed, rising into an uptrend. Silver is in an uptrend in the daily and monthly timeframes.

COMEX SI open interest rose +507 contracts. Current open interest for SI: 91% of global annual production, up +0.29% today. 1 SI contract stood for delivery at COMEX today.

The gold/silver ratio dropped -0.70 to 77.76. That’s bullish.

Silver definitely outperformed gold; at one point it was up almost a buck. It did manage to keep some of the gains into the close, so there is that. And for some reason forecaster liked today’s action too. Silver is now back up in a mild uptrend.

Silver follwed a similar pattern intraday; a late Asia/early London rally, which had mostly failed by end of day. The spinning top candle was a bullish continuation, forecaster climbed, rising into an uptrend. Silver is in an uptrend in the daily and monthly timeframes.

COMEX SI open interest rose +507 contracts. Current open interest for SI: 91% of global annual production, up +0.29% today. 1 SI contract stood for delivery at COMEX today.

The gold/silver ratio dropped -0.70 to 77.76. That’s bullish.

Silver definitely outperformed gold; at one point it was up almost a buck. It did manage to keep some of the gains into the close, so there is that. And for some reason forecaster liked today’s action too. Silver is now back up in a mild uptrend. I wonder; perhaps failed rallies are positive signs when prices are mostly just chopping sideways. They are definitely negative when prices are overbought.

Miners gapped up at the open, but then sold off all day long, closing at the lows. GDX fell -1.68% on moderately light volume, and GDXJ dropped -1.61% on moderate volume. XAU moved down -1.86%, the closing black marubozu candle was a bearish continuation, forecaster dropped, moving deeper into its downtrend. XAU is in an uptrend in the weekly and monthly timeframes.

The GDX:gold ratio dropped -1.92%, and the GDXJ:GDX ratio climbed +0.07%. That’s bearish.

This was a bearish day for the miners, no question about it. Miners closed well below the 9 MA, at the lows for the day, on a day when gold itself managed to stay even, and silver actually managed to rise. This is all bearish.

Platinum fell -5.40 [-0.63%], while palladium rose +9.94 [+0.42%]. That pretty well summarizes the difference between these two metals; platinum is back in a downtrend in all 3 timeframes, while palladium is in a mild uptrend, not too far from its recent highs.

Copper climbed +0.02 [+0.65%] to 3.08 on moderately light volume. The short white candle was a possible bearish reversal (32%), forecaster dropped, but remains in an uptrend. Copper is in an uptrend in all three timeframes.

Copper broke out to a new multi-year high today, but the rally mostly failed. The candle print was somewhat bearish, but not dreadfully so.

The buck dropped -0.25 [-0.27%] to 93.41 on moderate volume. The short black candle was a bearish continuation, forecaster dropped, but remains in an uptrend. The buck is in an uptrend in the daily timeframe.

Major currency moves included: EUR [+0.53%].

The buck fell today, ending the day below the 9 MA, but seemed to find support at the 50. Directionality for the buck right now is about as neutral as it gets.

Crude inched down -0.08 [-0.19%] to 40.95 on moderately light volume. The doji candle was a bullish continuation, forecaster climbed, rising into an uptrend. Crude is in an uptrend in the daily and weekly timeframes.

Like many other items, crude tried to rally today, but the rally failed. Crude’s trading range was fairly narrow, but it did manage to end the day both in an uptrend, and still above all 3 moving averages. The longer term (monthly) cycle appears to be down, but crude refuses to meaningfully correct.

SPX plunged -56.89 [-1.63%] to 3426.92 on moderate volume. The confirmed bearish spinning top pattern was a probable bearish reversal (63%), forecaster dropped, moving deeper into its downtrend. SPX is in an uptrend in the weekly and monthly timeframes.

Energy [-2.17%] led the market lower, along with tech [-1.87%], while utilities [-0.85%] and materials [-1.18%] did best. This was a relatively bearish sector map.

The VIX jumped higher, up +1.77 to 29.18.

NYSE decline ratio jumped to 73%, which is quite bearish; so was the candle print, so was the sector map. SPX ended the day well below the 9 MA. This sure looks like a real bearish reversal for SPX. And it also looks like a lower high is now in place. It has yet to be confirmed; that would require a close below (about) 3150.

TLT fell -0.38%. The short white candle was a bearish continuation, forecaster dropped, but remains in an uptrend. TLT is in an uptrend in the daily and weekly timeframes. The 30-Year yield rose +4.0 bp to +1.56%.

TY dropped -0.15%. The short black candle was a bearish continuation, forecaster fell, dropping into a downtrend. TY is in a downtrend in all three timeframes. The 10-Year yield rose +1.0 bp to +0.77%.

Ouch. Bonds falling along with equities. This is not a good sign. My sense: don’t be long Treasury bonds.

JNK dropped -0.21%. The short black candle was a bearish continuation, forecaster dropped, moving deeper into its downtrend. JNK is in a downtrend in both the daily and weekly timeframes.

Crappy debt is now in a more serious downtrend; it closed today back below the 50 MA. That echoes the risk off sentiment in equities.

Physical Supply

The GLD ETF tonnage on hand climbed +0.29 tons, with 1273 tons remaining in inventory.

ETF Discount to NAV:
* CEF -3.50%
* PHYS -0.79%
* PSLV -3.76%
Gold dealer big bar premiums:
* gold [1kg]: +1.21%
* silver [100 oz]: +7.09%

Physical ETF discounts continue to be wide; big bar premiums at retail are slightly better. [Note; there was an “ebay” offer for a 100 oz silver bar for +4.25% above spot – I didn’t include it]

Summary

Gold and silver moved higher (although both showed failed rallies), while the miners sold off reasonably briskly. What’s the deal with the plunge in the mining shares? Perhaps they got caught up with the general SPX downdraft today; sometimes that happens to the shares.

Risk assets were mixed; equities had a terrible day and is now looking short-term bearish, crappy debt sold off but not nearly as badly, copper tried to make a new multi-year high but failed, and crude’s attempted breakout failed also.

Oddly enough, both the buck and treasury bonds fell as well.

Taken as a whole, it feels as though money is running to cash. And leaving the US. Why do we think that is?

Part of it might be about some back and forth on the stimulus; Nancy is still not moving, while Trump is up to $1.9 trillion. The deadline is allegedly Tuesday. As in, tomorrow.

I think another part is about concern over the aftermath of the election. When will it actually be decided? Right now, we just don’t know.

Not much else to report; Trump now thinks he’s going to win, Biden refuses to answer questions about Hunter’s laptop conversations and has gone into hiding until the debate on Thursday, the upcoming debate will have “muted mics” for the two-minute answers, and Yahoo claims that Biden has surged to his largest-ever lead. Never a dull moment in the last two weeks before “the most important election ever.”

Chris Christie, who has now recovered from COVID-19 after spending 7 days in an ICU, issued a statement a few days ago on his reflections about his experience. I encourage you to read his entire statement. Note that the former governor is 58 years old, 5-11, 300 pounds [BMI: 41.8], and is asthmatic. He is exactly the sort of person that COVID-19 targets. While he did recover, it was clearly not as easy for him as it was for Trump [BMI: 31].

I think its really important to lose that extra weight, if you can. Some variables in life we cannot control; other variables, we can. We all have free will in areas such as this. Right now would be the time to exercise it. Better than masks, or social distancing, or hand-washing. Trump vs Christie. Can you believe Trump was the slim one? He was. Trump is 16 years older, but for the most part he sailed through his experience. Christie had a much more difficult time. Case study, n=2.

https://www.cnn.com/2020/10/15/politics/chris-christie-covid-19-statement/index.html

 

  • Tue, Oct 20, 2020 - 05:58am

    #2

    JAG

    Status Platinum Member (Offline)

    Joined: Oct 26 2008

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    Bitcoin

Since the markets look like they will go sideways until the election, here is something else to keep you entertained:

Not a bad summary.

  • Tue, Oct 20, 2020 - 11:12am

    #3

    davefairtex

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    sorry today

Sorry for the repeats & flaws in today’s report.  I can’t edit the thing for fear it will simply be deleted by the site when I submit it.  This has happened more times than I can count, so its a no-touch thing once I hit submit.

 

  • Tue, Oct 20, 2020 - 11:53am

    #4
    Mohammed Mast

    Mohammed Mast

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    Joined: May 17 2017

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    Today’s date: 2020-10-19

Raoul Pal is no one’s fool

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