The long terms charts for PMs show no direction
This downtrend in the metals over the past 2+ weeks has been rough but looking at the longer term charts we are not seeing any weakness. That being said we also are not seeing any strength. Doc and Al are part of today’s editorial where we focus on how long this down move will continue and a longer term outlook.
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Gold is in no mans’ land again as in the yellow triangle in his chart:
http://1000gold.blogspot.co.uk/2017/04/gold-holging-on-top-1264-by-its.html
Since that chart was done on 27 April, gold has failed to hold $1264 and is now back into its $1150-1264 range, somewhere, maybe for some time!
****MinesAndMoney Conference – NYC LIVE, right now!
Dan Oliver making some great points.
Doc, I am dropping Silver from my playing field except for my son’s account. And I am moving this $ over to Crypto. Making more money in one day on crypto than I can make on either side of the Silver trade. This Stock Market as a whole is becoming untradeable. People on Stocktwits are flocking to Crypto in DROVES!
Meant to say I can make more in 1 day on Crypto that I can in one month on Silver. My Bitcoin is up 16%, Ether up 7%, and Litecoin up 36% and it trades 24/7 without central banks four letter wording around with the price.
Jason – I wrote to you yesterday about this ETF Ninja…..
Get your rocks off trading these new vehicles gansta:
U.S. SEC approves request to list quadruple-leveraged ETFs
By Trevor Hunnicutt – Tue May 2, 2017
I HEARD ABOUT THOSE! 4X WOOHOO!!
Insanity. Someone joked yesterday on a different blog that they may be the first ETFs to reverse split the first week they get going, and then every week there after. 😮
Miners tried to establish a bottom today but late afternoon, the metals just wouldn’t cooperate. It’s still ahead of us. But, we’re closer than we were yesterday.
Silverdollar – Yes I noticed that the miners were a little peppier mid-day but this selloff is getting long in the tooth and is due for a relief rally.
If we’re going to break an uptrend, it’s good to have it happen after 13 straight days down and with a daily RSI(14) at 20.
http://stockcharts.com/h-sc/ui?s=SLV&p=W&yr=4&mn=2&dy=0&id=p66352769933&a=521684160
Looks like the Jan. 4 gap is about to get filled…
http://stockcharts.com/h-sc/ui?s=SLV&p=D&yr=1&mn=0&dy=13&id=p89951092796
Great chart and it does look like we’ve arrived at support. Yes 13 days is a row has the rubberband a bit too stretched to the downside.
Looking forward to the balance of the week to see if we get a relief rally.
As Silverdollar mentioned, the miners did have a little more life towards the second half of the trading day.
SILVER MINE YIELDS OFF 43% IN 11 YEARS, NO SIGNS OF ABATING
By Soren K.Group
(there are some good Macro facts and charts in the article on Silver sector)
https://www.marketslant.com/article/silver-mine-yields-43-11-years-no-signs-abating
$silver’s 14 day RSI didn’t hit this level during the entire bull run except for 2008, where it continued to waterfall downwards.
The last time this happened in 2013 and 2014 price continued to collapse for another month. in 2014 price collapsed another $3 even after hitting such extreme oversold levels.
This is in no way shape or form bullish from a contrarian perspective. We could see a real waterfall decline.
There was a reason the CoT short position were at all time highs a couple of weeks ago.
Context and detail matter, Spanky. Comparing today to 2013 is an apples-to-oranges comparison. What happens at the start of a new bear market cannot be expected to be the same as what happens at the start of a new bull market.
Why don’t we take a look at what happened in 2002 and 2003 after the bear market low of late 2001?
Even the oversold reading of last October resulted in an 11% rise.
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=D&yr=1&mn=0&dy=13&id=p89951092796
That is a great point Matthew. Extrapolating out how the RSI levels were in 2013 and 2014 (when the miners and sentiment was a much different sentiment) is much different that applying that today when Gold/Silver are now transitioning over to Bull Market.
Despite all the crazy negative sentiment you see in the space the last few weeks Gold is still at $1240 and nowhere close to the Major Low put in Dec of 2015 at $1045.40. It has been a year and half since then, and the surge in metals and miners in 2016 took out key overhead resistance levels and moving averages that they hadn’t in years. That was the clue that the cyclical Bear market was done, and the Secular Bull market was resuming again. We have a new Bull market playbook now and what may have been good levels in Bear market don’t apply. We’ve discussed how the charting indicators have also shifted lately in a number of parameters as far as when investors should consider stocks or commodities “Overbought/Oversold”. Good thoughts guys.
Based on history, you are wrong. This type of oversold condition has led to a significantly lower low in time 99% in due course.
spanky – What data can you provide that shows a 99% correlation?
I’d be very interested in seeing that information.
It’s called pulling up a long term chart and looking how many times daily RSI has hit these levels. For $silver, the 14 day rsi hit these levels only what looks to me like 8 times. Every single time, save for maybe the instance in 2004, silver made a significantly lower low in the the next month or longer. Okay, that may not be 99%, but the odds of this low being “the” bottom is extremely low based on the empirical evidence.
You just have to figure out what empirical evidence is. 😉
Here’s a Schiff fork that’s working well. A 1.5% drop to support tomorrow would fill the March 16 gap…
http://stockcharts.com/h-sc/ui?s=GLD&p=D&yr=1&mn=0&dy=0&id=p05791459181&a=521457207
I think we will definitely bounce at your bottom fork support indicated, which corresponds more or less to the 100 DMA, and maybe fairly substantially(maybe all the way back to the 200 dma). But all that bounce will do is carve out a giant head and shoulders with a diagonal neckline that projects back at least to the December low.
Here’s another way to look at it that’s even less menacing:
http://stockcharts.com/h-sc/ui?s=GLD&p=D&yr=0&mn=7&dy=13&id=p51089493514&a=521696971
Groups Sue To Keep Drilling Ban In Arctic, Atlantic Waters
By DAN JOLING – Associated Press – 5 minutes ago
ANCHORAGE, Alaska (AP) — Less than a week after President Donald Trump took steps to put U.S. Arctic and Atlantic waters back in play for offshore drilling, 10 environmental and Alaska Native groups sued Wednesday to maintain the ban on oil and gas exploration.
The ban was a key part of former President Barack Obama’s environmental legacy, aimed at protecting polar bears, walrus, ice seals and Native villages that depend on them from industrialization and oil spills. Waters of the Atlantic continental shelf also support whales, swordfish, bluefin tuna, sea turtles and businesses heavily dependent on the health of the ocean ecosystem, according to the lawsuit.
In an executive order Friday, Trump ordered Interior Secretary Ryan Zinke to review the withdrawal with the goal of expanded drilling.
The federal lawsuit filed in Anchorage claims Trump exceeded his constitutional authority and violated federal law. No president before Trump has tried to undo or reverse a permanent halt to drilling in outer continental shelf areas, said Kristen Monsell, an attorney for the Center for Biological Diversity.
Spanky, replying from yesterday’s thread.
‘At best neutral’??
It’s all about time scale. Sure it’s bearish in the short term. I posted this chart probably over a month ago, saying I expected sideways to down motion for weeks to months, with the cyan line as my best guess.
http://stockcharts.com/h-sc/ui?s=GDXJ&p=W&yr=8&mn=0&dy=0&id=p58325225309&a=501069308
It has been sharper to the downside than I expected. But it hasn’t yet ruined the larger bullish picture. A dramatic break of the 5 year downtrend in 2016. Higher highs and lows. Still above the up trend line from the Dec 2015 low. Yes, it is currently below the 200 week simple moving average, which I thought would hold. But 1) the week isn’t over yet, so the candle isn’t complete, and 2) even a few weeks below this moving average wouldn’t be a deal breaker, unless it plummets.
I can put up a long term weekly chart of gold, gdx, silver, sil and in the big picture they all look more bullish than bearish, by similar criteria as I list above. My opinion, people with dry powder should have a great buying opportunity sometime between now and this fall. July, if I were forced to guess. Long-term holders shouldn’t get despondent. Those who stress these moves, well, I don’t think it will get any easier. It’s a manic depressive sector.
My views will be contingent on price action, but I don’t see anything to get too worked up about so far. This action is fantastic for skilled traders. I just wish I were better at it. But I am getting better :-).
BTW, given that GDXJ’s 200 week simple moving average was declining until more or less right now, it was quite likely that the price would backtest it again before any sustained move upward.
Good thoughts in that post above. I agree that investors will dry powder will be given (and technically are currently being given) a great buying opportunity in many of these beat down miners. July is mentally where I have projected my final purchases, after all the GDXJ rebalancing in Mid June is completed and sentiment resets.
Your insights are much appreciated.
“even a few weeks below this moving average wouldn’t be a deal breaker, unless it plummets.” Wow, that’s reassuring. :]
😮
‘deal breaker’ wasn’t the best word choice in any case. ’cause for much concern’ would be better. I imagine we agree that there are key technical levels, and the more that get broken, the worse. But a ‘deal breaker’ for the secular bull, and even for the resumption of the bull, is still various key levels below.
I think we’re in agreement on the short term–a relief rally due soon, and we’ll see from there. I don’t think your idea of a lower low by June is out of the question by any means.
The $xjy chart and the gld chart look identical in terms of inflections. I expect both of them to tag the 100 dma before a bounce, and they will probably do it more or less simultaneously.
sil:slv daily chart–nice black doji marking a reversal. Down we go in the miners.
The 89 week MA has now crossed above the 144 week MA for the first time since 2010…
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=W&yr=7&mn=7&dy=0&id=p02347642121&a=521147109
Too bad it coincides with a collapse instead of a moonshot this time.
Funny stuff, Spanky!
Thanks Matthew. IMO that is a VERY significant Silver chart, and looks quite constructive.
This is one impressive sell-off in the PMs, especially silver. Below 16.50, it has now lost over $2 in the last few weeks. This is damaging unfortunately and just reiterates that the bear continues. Can anyone identify a solid floor for gold and silver? The status quo remains. It pains me to admit it but the cap on PMs has shown renewed strength whether manipulated or not. What a start to “Sell in May”!
Early this week it was important for Silver to hold the most recent March 2017 trough of $16.83. It did close on Monday at $16.84 and yesterday at $16.83, so there was a solid chance of Silver double bottoming there….. but clearly it broke down through that level today — down to the $16.50 area.
* The next most important support is clearly that December 2016 low of $15.68.
There are a few trend line and retracement levels before we get down to $15.68 that may offer support, but $15.68 is the line in the sand. If that were to break, we’d have a lower low, and that would shift the larger trend back over to the bears.
http://stockcharts.com/h-sc/ui?s=%24SILVER&p=D&yr=2&mn=0&dy=0&id=p06240510924
All I can say is thank goodness I switched some of my gold into the biotechs…..no bio expert more a case of being suggested a few and looking at the technicals
That was a cogent move wolfster. Good on ya buddy!!
Did you do an ETF like (IBB) or (XBI), or more in individual stocks?
Went individual stocks. The one Thom keeps plugging immunovaccine had a nice consolidation after its big run so I got some of it and a friend suggested one called portage biotech that he liked. I might be in the minority but I don’t like etf’s.Like to move away from some resource plays rather than sell in May and go away
Yes, I saw the one Thom’s been mentioning but will have to look at at Portage as well. Typically I steer clear of sectors I don’t understand (like biotech) but I have used IBB and XBI and LABU and LABD for trading the macro trend before.
At times like these it would have been better to have had my portfolio a bit more diversified but most sectors don’t offer up extreme enough percentage moves to interest me. Biotech is one of the few areas with enough volatility to keep things interesting and offer big enough swings.
A nice move today by PPP—-also up in the after markets. I’m beating myself since I planned on adding to my position and didn’t. Nice earnings report for 1st quarter inspite of the mine shut down for a good part of the quarter. They don’t explain why but it could be they had inventory of PMs they sold with minimal cost since the shut down due to labor issues.
Agreed Doc. The PPP move was encouraging to see off the 1st quarter earnings. Also, investors and analysts are starting to realize the sky is not falling with Primero and later this year it will continue to get re-rated to the upside.
Has anyone noticed the latest climb in bitcoin prices? This has coincided with the PMs decline and the same thing happened earlier in the year when bitcoin climbed drastically. Not saying that money flow is directly intertwined into these two markets but it perhaps illustrates how sentiment from one, negatively correlates to the other and vice versa.
Hi Oz:
Not only has there been an inverse correlation between Bitcoin and the Comex Gold futures,the inverse correlation also exists with Bitcoin and the $SSEC.
I started tracking this last month.
BTC,$SSEC,Gold. Chinese volatility priced in Gold.
Once we get a decent pullback in Bitcoin my data should start making more sense as the data has been so one sided.
I’m always looking for different ways to make sense of things.Bitcoin could hold some answers.
So true John.
The natural human reaction in me cant help but be slightly regretful of bitcoins move when I consider how close I came to buying in on the market back in the beginning of 2013 when it was in the $60 range. Ohh well, that horse has bolted now.
Any ideas where you think bitcoin ends up in the interim John?
So at the market close yesterday Bitcoin was at 1404.97, as I type Bitcoin is at 1477.50.
I have no idea where the price will go,but I can say with a fair amount of certainty that when Bitcoin pulls back, it will pull back to a level higher than the last pullback.
Remember when I said that the more people that use Bitcoin the higher the price would go? That is not what is going on now.But that is not necessarily a bad thing as it is drawing new attention to the digital currency.
Look at the last time Bitcoin pulled back,note that level.
I purchased Bitcoin not as an investment, but the chance that this new form of currency I didn’t understand would turn out to be something.
Time will tell.
John…..thanks for the info…….on Bitcoin………….OOTB
Spoke with JJ from excelsior yesterday…if I understood things correctly permits in 3rd qt. hope to get bump up from news on permits before doing any equity financing along with some form of debt financing.talking about $70M all told. Still looking to be in production in 1st qt of 2018
Like I said, all a bounce at that lower rail will set up is a gigantic head and shoulders. That’s all we ever see in this damn sector. H&S everywhere!
I’m not worried about any H&S on that chart.
GCC is headed to 18 based on the head and shoulders projection. And the miners aren’t going to bottom before then.
June 14 is the FOMC meeting. Gold has sold off hard prior to these meeting ever single time since 2015 and only bottoms on that day or the day after. It will be the same thing this time too.
SLV 8 closes under the lower bollinger band (20,2) (barring a miracle reversal today). Never seen that happen with any stock or ETF ever. If someone has, I would like to know what and when.
Im no expert but it seems like ANF Anfield gold is way oversold. 0.50 cad today. 0.84 cad yesterday. Almost 2 cad last summer. Weekness in gold and a weak resource update maybe is the recipe for cheap goldjunior stocks.
Or maybe its pricing in a bear market?
Wow, what’s the deal with that thing? Is that a widely held/recommended stock?
http://stockcharts.com/h-sc/ui?s=ANF.V&p=W&yr=6&mn=5&dy=0&id=p01472466534&a=519372985
Its a Ross Beaty company. Thats the big : Say what????
$indu:$gold ratio approaching the declining 200 month MA. If that gives way, kiss gold good-bye.
The gold-silver ratio is extremely overbought …
http://stockcharts.com/h-sc/ui?s=GLD%3ASLV&p=D&yr=1&mn=1&dy=13&id=p25873464381&a=521820217
It is absolutely due for some short term relief. But this huge move has set up a bullish trade on that ratio on any correction back down. Also, price can and likely will diverge from RSI as RSI starts coming back down to earth. That is typically what happens. The RSI will come back down, but gld:slv will continue to make higher highs over the next 1-2 months.
I am fully on board for a relief rally, and it could be large, but at best the miners are dead money for the next couple of months and at worst are going to get the ever loving snot knocked out of them (even more). Like I have been saying, GDX will touch the lower monthly bollinger band (18.2) before making new highs.
Depending on how deep we go, new highs in the miners could be many years away even if we are in a new bull. Again I will point to the $sugar’s monthly chart from its bottom in the late 1990’s. An initial surge higher was followed by a deep retracement of almost the entire up leg, and then consolidated for years before finally breaking higher. Moreover, $sugar had made a bear cross on the monthly, very similar to what the miner have done (see the $hui monthly chart). The breakdown in $sugar after its initial bottom came as it tried to get back above the declining 50 month MA. The same exact thing seems to be unfolding in the miners right now.
BITCOIN……………….$1600…………….hello…………..
https://mcalvanyweeklycommentary.com/wp-content/uploads/ica2017-0503.mp3