Tag: s&p500

Huge Upside Potential In Gold Miners

Huge Upside Potential In Gold Miners

Since September 2012, the S&P500 and the gold mining indexes decoupled from each other. Today, the disconnect between both is huge. From a technical perspective, it appears that the gold miners are testing a resistance line which goes back spring 2013. One should closely monitor the ongoing price action in the gold miners. If they would be able to break through the current price point (250 area), then the good days of gold and silver miners could be here. That would indicate underlying strength in the precious metals complex, and hence in the metals as well.

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Gold Price & the S&P 500 Index: What Does The 20 Year Chart Suggest?

| July 10, 2014 | Category: Price
Gold Price & the S&P 500 Index: What Does The 20 Year Chart Suggest?

I think both the gold market and the S&P are at or near the end of their recent trends. The S&P is at all-time highs, has been rising for 5+ years, and is over-extended by many measures. Sentiment is overly positive. It appears ready to fall or move sideways for some time. “Financial TV” will be disappointed. Gold dropped nearly 40% into its December 2013 low and is finally moving higher. Sentiment is still negative, but gold appears ready to rally. Gold “bears” and the bond market will be disappointed.

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Stock Bull Topping

Stock Bull Topping

With the US stock markets near major multi-year highs, traders are naturally very optimistic. Predictions abound for a continuing advance to new all-time highs. But behind this happy facade, the secular picture is actually quite bearish. The powerful stock bull of recent years appears to be topping in recent months. This means the odds are ballooning that a new bear market is being born or soon will be. Few, if any, things are more important for stock investors to understand than the bull-bear cycles. They can only be ignored at great peril. Investors who refuse to study them inevitably end up buying stocks at the wrong times in these cycles. […]

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Precious Metals Succumbing to Deflationary Forces Today

Precious Metals Succumbing to Deflationary Forces Today

Both Gold and Silver are under selling pressure today as the sell off in the grains seems to have pushed a large amount of hot money out of the commodity sector. Soybeans are currently locked at limit down as is the front month corn contract. Talk that Smithfield is importing corn from Brazil has sent supply side bulls scurrying for cover and demand side bears are pressing their case. The pool in the July was 112K at one time and is now down to 26K currently. In the November Beans, the pool is at 37K as I write this. Traders had been bidding up commodities in general of late as […]

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Put Your Seatbelts On, It’s About To Get Bumpy

Put Your Seatbelts On, It’s About To Get Bumpy

It was just about a year ago today when the S&P was sitting at fresh highs and everyone was enjoying a rather upbeat summer.  It was a nice summer, the markets were calm, and there was a surreal sense of optimism.  Then, in the matter of a few days, things got real ugly, real quickly. Well, it doesn’t seem like too much has changed since then.  We’ve had mixed earnings reports, ever-evolving worries in Europe, and the always looming fiscal mess in the U.S.  Once again, are we in the calm before the storm? It looks like things in Europe may start to heat up again.  Riots turned violent again […]

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Are Lower Stock Prices in the Cards and What Would it Mean for Gold?

Are Lower Stock Prices in the Cards and What Would it Mean for Gold?

The Federal Reserve will hold a two-day policy meeting on July 31 that is expected to yield no change in U.S. interest rates, but markets will analyze and dissect every word of Chairman Ben Bernanke for any clues that the central bank will do more to promote economic growth. Already it seems that three top Federal Reserve policymakers on Monday laid the groundwork for a third round of bond purchases by saying the U.S. recovery was weak and unemployment too high, but at the same time they said the situation is not bad enough to warrant another QE right now. In the June 22, 2012 Premium Update we wrote that […]

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SPX and 2012 Elections 2

SPX and 2012 Elections 2

After the US Supreme Court inexplicably redefined Obamacare to uphold its constitutionality, politics are very much back in the news. And with the all-important US elections only 4 months away, it’s only going to get worse. Interestingly, the state of the US stock markets heading into voting is likely to both predict and heavily influence the outcome. The markets’ impact on Americans’ collective psyche is vast. For most investors and speculators, this is pretty obvious. When the stock markets are up we feel more optimistic about everything, so we tend to spend more. Economists call this the wealth effect. And when the markets are down we feel more anxious and […]

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Mining Shares Continue to Outperform the Broader Equity Markets

Mining Shares Continue to Outperform the Broader Equity Markets

The last time we had a THREE CONSECUTIVE WEEKS during which the mining shares outperformed the broader US equity markets was in late October/early November of 2011.  While the  month of May this year has been attrocious for the S&P 500, it has been an excellent month for the miners. June is starting out on a good note to say the least as we witness today’s strong upmove in the mining shares. My interpretation of this event is that today’s payrolls number, which was so horrible that it cannot have any sort of positive spin placed upon it, has jolted traders into moving more and more to the view that […]

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What Can We Infer From the Gold:Dow Ratio?

What Can We Infer From the Gold:Dow Ratio?

There is all the talk of Greece leaving the eurozone and we are already seeing a slow-motion runs on Greek banks. The Financial Times reports that €5 billion has left Greek banks in just the last two weeks and the more that Greek citizens feel it is possible that their country will leave the euro, the more incentive they have for pulling their money out and sending it abroad. There are no rules in place for a country to leave the eurozone and it is anybody’s guess as to how severe the impact of such a move will be. These are uncharted waters and the sailing could get very rough. […]

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Is Major Decline in the Precious Metals Stocks Underway?

Is Major Decline in the Precious Metals Stocks Underway?

All eyes are on Greece which is heading toward national elections six weeks after the last vote. Many feel that a Greek euro exit would be a chance to cauterize a festering wound and move on. There are also those that feel that Greece could be the first of several dominoes to fall, much larger economies such as Spain, Italy, for example. Meanwhile, Spain’s 10-year borrowing costs had hit as much as 6.5 per cent on Wednesday with the risk of the country paying astronomical prices to borrow in the future. Spain has now issued more than half of its total debt needed for this year, yet concerns that Madrid […]

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The Influence of the General Stock Market and Crude Oil on Gold

The Influence of the General Stock Market and Crude Oil on Gold

We’re getting whiplash from all the political changes in Europe, neo-Nazis in an unstable government in Greece and a changing of the guard in France– “adieu” to Nicolas Sarkozy. We see plenty of reasons for holding on to our long-term gold positions despite the clobbering the yellow metal got on Wednesday down to a four-month low. The euro tumbled this week against the dollar in the worst run since 2008. There is an intense resurgence of political risk in Europe and a couple of months of weak jobs numbers in the U.S. All that has put stimulus back on the table. Another item on the table is the risk of […]

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Fear and SPX Toppings

Fear and SPX Toppings

With the US stock markets surging nearly a third higher in just 6 months, the odds are rising for a major topping. As the best times to sell high, recognizing these events in real-time is very important for traders. But it is a big challenge due to the gradual way toppings unfold. An indicator that can really help is the famous implied-volatility fear gauges. They tend to exhibit unique and identifiable behaviors at toppings. This is counterintuitive at first, as the dangerous emotion of fear is rightfully associated with bottomings. Traders get scared when the markets sell off sharply, and fear flares as new interim lows are hit. Toppings, on […]

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Many Signs Point to Gold’s Higher Prices

Many Signs Point to Gold’s Higher Prices

The Reserve Bank of India on Tuesday surprised investors with a bigger-than-expected half-percentage-point cut to its key lending rate, sending it to 8%, saying the state of India’s economy is “a matter of growing concern.” Assuming a normal monsoon season, continuing improvement in industrial production and in the global outlook, the RBI said it expects growth for the current year at 7.3%. Inflation in India slowed less than expected in March. Indians, who love gold in any case, could turn to it as an inflation hedge. Meanwhile, the Indian Post office system is offering a 6% rebate on gold coins of various denominations for the forthcoming Akshaya Tritiya festival, which […]

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UP and UP she goes – where she stops nobody knows

| March 17, 2012 | Articles: Insights
UP and UP she goes – where she stops nobody knows

I am becoming more and more convinced that the US Monetary Authorities have engaged in a process which is resulting in the formation of another bubble, this time once again in the US equity markets. Think back over the last decade+ and what w…

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