Gold

Notable Public Posts

US Treasury Bonds, Gold & Stock Market

The following is one of a wide range of analytical topics covered in NFTRH 293’s 35 pages this week, much of which is straight ahead technical analysis.  But the T Bond market is usually central to an overall macro view at any given time.  This segment is not meant to provide actionable direction (other than perhaps to prepare for a potential rise in T bonds yields), it is meant to dig into the mechanics beneath the financial markets in an effort to have people consider that there is much more going on with markets than simple nominal TA or conventional fundamental analysis (PE ratios, growth metrics, reported economic data, etc.) can account for.

US Treasury Bonds

tnx.tyx
10 & 30yr yields have declined to support as NFTRH projected

Yields on long-term Treasuries have continued to decline in line with our view that was contrary the ‘Great Rotation’ (out of bonds) hype. The [30-year] especially is now close to support and the next play seems like it could be rising yields and declining T bonds.

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Our long-term ‘Continuum’ chart; yields approach support

The 30-year ‘Continuum’ view above makes the simple case that players had to be put offside believing in the ‘Great Rotation’ at 4% yields. The nearly half-year decline since then has now satisfied the chart as yields have come to our 3.1% to 3.2% target range, where there is support.

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June 2, 2014
NFTRH Interim Updates

Update; Market Review

There is a problem with biiwii.com’s server this morning and I was unable to do the Wednesday morning Key ETF update without constant interruptions. In its place this week we’ll simply go with a general update by email.

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April 23, 2014
NFTRH Interim Updates

Update; Precious Metals

HUI has declined to 215 and made a marginal lower low from the start of the bear flag in the 216’s.  We had been anticipating 210 as the critical support to a bottoming scenario.  So, given the proclivity of this sector to test limits, let’s keep that alive.

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April 22, 2014
Notable Public Posts

Big Pictures: Stocks, Gold and the Miners

Ukraine war hype, China demand drop, GOFO mysteries… these are the short term noise inputs on the gold sector.

US Treasury bond yield spreads, gold vs. commodities (i.e. the ‘real’ price of gold), gold vs. the stock market… these are some of the fundamental considerations that actually matter and they have taken a hit since January.

It is easy to say ‘I am bullish in the big picture’ (measured in years) but it is not so easy to actively manage in the smaller pictures (measured in days, weeks and months) with all of the above noise inputs and more bombarding the poor individual player.

We use shorter term charts to manage the shorter time frames.  Daily charts have most recently indicated a bearish set up as bear flags formed across the precious metals complex (with the exception of silver, which never got going to begin with) last week.  Weekly charts continue to indicate that an extended and oh so grinding bottom may be forming, but that includes the potential for ups and downs, also known as volatility.

There is also a lot of noise lately in the stock market.  The US stock bull celebrated its 5th birthday last month.  The last 2 cycles (the manic phase of the secular bull ended 2000 and the cyclical bull ended 2007) were each approximately 5 years long.  Today let’s retreat to the calm of the long term monthly charts and get a snapshot of the big picture.

The S&P 500 has a measured target of around 2190 that we have had open as a possibility since the big breakout occurred in early 2013.  A measured target is just that, a measurement; simple math.  It is not a directive and therefore 2190 is not hype, it is just a possibility.

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April 17, 2014
NFTRH Interim Updates

NFTRH Update, Precious Metals End of Day Snapshot

The 10 vs. 2 year yield spread dropped, which was an in-day negative not to be given undue weight based on one day, but to be respected none the less.  Interestingly, the sector went nowhere (GDX) to down (GDXJ, gold, silver) yesterday as the spread popped.  Today spread down, sector up.

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April 2, 2014
Notable Public Posts / White Papers

Gold Contrary Indicators

gold.barA ‘White Paper’ article on contrary indicators in the emotion packed gold sector.  Make it them work for, not against you.

The gold sector is peopled by a high concentration of contrary indicators because it is a relatively (to the vast world of equities and bonds) small market that offers refuge from some of the damaging aspects of the spectrum of investment products that are supported by the manipulation of interest rates and printed (and digitally created) money supplies.  Thus, gold has moral high ground if an asset can be thought to have morality.

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April 2, 2014
NFTRH Interim Updates

NFTRH Update, Perspective on the Silver Divergence

It is interesting how sometimes a chart will do what it thinks it is supposed to do, even in the face of other information that says it should do something else.  Silver’s chart, as we have been noting, was supposed to test support and that is what it has been doing while the rest of the precious metals complex rises.

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March 14, 2014
Notable Public Posts

Precious Metals Grind Out a New Trend

Gold is Monetary Value

We preface the post with a statement that has not changed since I began public writing nearly 10 years ago:  Gold is not about price; gold is about value.  This point was hammered home to me 11 years ago by a person who had much influence upon my viewpoint toward the financial system and its various diseased components at a time when I was ready to listen and understand.

So whether we are talking about 2013’s epic price crash or a new bull trend in 2014, the simple fact is that physical gold itself is a store of monetary value.  That applied last year as the value was marked down by greed and confidence and it will apply this year as it is marked up in the face of a likely unwinding of those things.  Humans, what funny and hyper kinetic animals.

Precious Metals Speculation

Ah, but this post is about the fun part, the speculative part where we humans can make gains from gaming the simple store of value and its wild little brother, silver.  As asset market speculators we care about prices, right?  How about the share prices of the completely blown to bits miners that dig the stuff out of the ground?

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February 14, 2014
Notable Public Posts

Precious Metals: Risk Management to Opportunity

What Has Been

A solid 2.5 years of risk management (to varying degrees) has been required of precious metals investors.  It was most intensely required after the announcement of QE3, when the net commercial short position in silver began a relentless march toward a very bearish alignment in late 2012 and then the HUI Gold Bugs index lost an important support level at around 460.  Here is the chart of silver with a heavy commercial net short position from NFTRH 215, dated 12.2.12:

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January 7, 2014
Notable Public Posts

Party Today, Macro Market Changes Ahead

The following is an excerpt from NFTRH 270, dated 12.22.13:

Now What?  This is What

From NFTRH 269’s opening segment ‘Market Correction on Cue, Now What?’:

“The question now is whether or not this is the start of a larger topping scenario and the answer to that question is for now at least, no, not by evidence showing up in our indicators like junk bond (risk on) speculation and sentiment, which was dialed back from heartily over bullish to neutral by the correction of the last couple of weeks.”

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December 24, 2013
Notable Public Posts

Enjoy the Punch Holiday Revelers

Party goers are gathered around the punch bowl as expected after the FOMC’s token move on QE.  Jeff Lacker is jawboning additional tapers in $10b chunks and all seems right, except… the ‘continuum’ (AKA the 100 month EMA on the 30 year bond yield chart).

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Let me ask you Beuller, what happened at the red arrow in 2000?  What happened after the red arrow in 2007?  What happened after the plunge in 2008?  What happened after the red arrow in 2011?  What happened after the most recent bottom in 2012?  The answers are 1) the end of a secular bull market in stocks, 2) the end of the last cyclical bull market in stocks, 3) the birth of the current cyclical bull market in stocks, 4) the end of the big cyclical commodities rally and 5) the launch of this most powerful leg of the cyclical stock bull market.

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December 23, 2013