NFTRH+; HUI daily chart & notes on gold, silver and the macro

HUI’s bounce has come to its first key level.

Here resides the down-sloping SMA 50 and lateral resistance. This was the minimum bounce objective and it could halt the bounce. But I would not discount the down-sloping SMA 200 as HUI is not nearly overbought and you just can’t count on technicals to do the same thing they did last time (Huey failed at the SMA 50 in early August).

But if the SMA 50 was your objective, here it is.

Other Notes

  • Silver has also popped to its SMA 50 and its first notable resistance zone at 24.90.
  • Gold looks pretty darned okay, taking out its SMA 200, but approaching the next resistance area in the 1840 to 1860 zone. Gold needs to clear 1920 to conclusively end the correction.
  • The Gold/Silver ratio and US dollar are dropping and the opposing 30yr yield is rising (but not yet conclusively resuming its daily chart uptrend), implying that inflationists are emboldening. If that continues let’s remember that the gold miners did poorly in the first leg up in the yield (August ’20 to March ’21). There will be other factors to consider like real rates, prospects for economically impairing Stagflation, etc. But market participants are cheering an inflationary macro at the moment and that is not the best fundamental backdrop for gold mining (although HUI’s bubble rose well over 300% in 2003-2008 against such a backdrop).

See you on Sunday with NFTRH 671, where we’ll get into more detail.