NFTRH+; Pictures of a Knee-Jerk

Vaccine news hits the screens and voila…

ES has popped a new high, following through on last week’s joy.

DXY is still bearish but holding support.

Long-term Treasury yields are ramping. This is a positive reflection on the reflation trades, esp. banks.

Cyclical copper is fine.

And of course, counter-cyclical gold? Not fine. Hammered. While I am loath to let knee jerk reactions direct me, let’s remember that when gold gets caught up with shady concepts like war, terror, pestilence it gets killed when the fear unwinds.

Gold is not about that stuff and the reaction will wear off. But the chart is the chart and not only is there no follow-through, the breakout is gone. Thursday’s move is negated and technically, we are back on the original plan of an ongoing (and healthy) correction. If this is not a super quick reaction and gold does not hold the current level in the mid-high 1800s then watch the rising SMA 200 (1784).

The Gold/SPX ratio is going to break down here and the implication is that yes, the lower ‘fear gap’ can fill and we may have that more significant buying opportunity in the miners after all, rather than having to chase a breakout.

Silver got dope hammered right at the lateral resistance area we’ve been noting. There will be a lot of noise, both from the happy anti-gold people and the gold bugs (esp. political gold bugs) crying about an attack by nefarious forces. But this is all normal to how the precious metals operate, esp. in a bull market. Tune out the noise. The PMs will be about forward monetary/fiscal policy and the economy.