Well hallelujah! Finally, we have a move in the right direction by our friends at the Fed. Token though it may be. We needed a signal toward change and we got it.
Believe me folks, the precious metals were being done no good whatsoever by the ongoing QE operation. We needed to get the process of what comes next kicked into gear. I was actually hoping to see a knee jerk down in the precious metals (and stock markets) but that has not happened thus far. Maybe tomorrow or over the coming few days. Or maybe never (for the PM’s, I still expect a stock market top in first half 2014).
That is why I hold puts on the GDX. I don’t really need to care how the bottom gets here (or already got here). I am continuing to hold and slowly add (BTG brought on today) positions against the puts, which may well expire worthless.
But the main point of this update is that they have begun to taper and that is the first sign that it is generally time to move into the precious metals, because everybody who would have sold due to the dreaded taper has already done so. Add in tax loss selling and…
Now the technicals still say lower, but technicals can be voided as we all know. HUI 206-211 is key. Gold’s neckline on the daily pattern is important too.
As for the broad market, this pump is impressive. If the market is going to continue correcting prior to Santa, it needs to reverse immediately or Santa could already be here.
More to follow as events unfold.