The Macro View and the Stock Market

Excerpted from the September 21 edition of NFTRH, #309, which went on to do extensive technical and macro work across all the key markets…

Last week we noted that Uncle Buck would be front and center in the analysis, not because the strength in the (anti-market) currency was not expected (it was), but because our big picture theme of an ongoing economic contraction had remained intact (ref: gold vs. commodities ratio) over the long-term.

It is important here to remember that NFTRH would only be on its big picture macro themes as long as indictors implied they are still viable.  I will be damned if I will let us follow a Pied Piper off an ideological cliff, no matter what readers (including me) might want to hear.  We must dedicate to know what is happening, not what our hopes, dreams, egos, etc. think or worse, hope will happen.

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NFTRH; Multi Market Update

Gold stocks are down again today and it is now decision time (for the sector if not individuals).  That is because the parameter is to not make and hold a new low to the May low on a closing basis.  We noted that a bounce is possible and if it is going to happen it should happen around here, at the May low with a similar over sold RSI.  Either that or it would be broken with a lower low (that does not reverse quickly).

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NFTRH; EM’s vs. SPY, GSR, USD, etc…

There are a lot of things in play today, including a notable rise in the gold-silver ratio concurrent with USD (finally, these two are both working together, which would be a component of our favored macro plan for future economic contraction, stock market troubles, etc.).  But the point of this update is to further the point we made last week about the Emerging Markets’ potential breakdown nominally and in relation to the US market.

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NFTRH; GDXJ Daily Chart Parameters

Folks, first I’ll note that hedging the precious metals for me has often proven more aggravating than it was worth.  That has been due to the grinding nature of this would-be big picture bottoming process.  So I am just letting you know that rather than selling junior and exploration gold positions in the IRA, I am protecting them with JDST with the intent to get through the FOMC tomorrow now that some gains have been made.  The biggest protection continues to be the ongoing high cash level as noted in NFTRH 308, which is the best form of risk management (in my opinion) until we get clear of some technical parameters.

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