RE: EOD Market Update SPX500 8/23/2017
I've heard the argument, but on the study I concluded last week there has been no correlation (except incidental and temporary) between USD, the equity markets, and the commodity markets. If there was a commodity linked currency out there whether it be gold, oil, cotton...anything, then we could draw some type of correlation. I haven't looked at GDX since the first quarter as the low in GLD was made on 12/20/16 (as I remember, don't quote me) so I was looking for a bounce in the miners. The issue I have is that the miners are poorly managed so even if gold posted a run that would not easily translate into a gain for GDX although that was the case in mid-2016. On the other hand, even if gold is hoarded (continued growth in supply) it does not seem to have an effect on demand thereby making GDX difficult to short. So I guess I am saying there are better fish to catch in this pond.
Well, make no mistake about it, when "crash n burn" finally arrives there will be a flight to the "safety" of the U.S. dollar, just as in 2008. If you look at the historic dollar charts it will "clearly" show you the flight to safety in the dollar in mid 2008. That was nixed when the gold stocks "correctly" began to predict the inflationary aspects of the "free money" Wall St society. The gold stocks began to rally in the period betwixt Aug-Nov 2008...well before the stock market bottomed. I know because back then I began accumulating mining shares and owned 8 different stocks and they all rose 300%+ each before I completely exited...too early. :-) The dollar has maintained its strength even as the markets have rallied to new highs, but I agree about the dollar not being the main cause of the gold collapse. I say the dollar is simply pre-saging the coming deflationary spiral ...just as gold has been since late 2011. Also, in a "proper" gold bull market the gold stocks will lead the commodity. That is not the case now however. There is a clear divergence showing if you look at the HUI vs GLD, especially in the past 6 months. This rally in GLD this month has now breached the June high that "needed" to get taken out before GLD can move to a new 52 week low.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=Fund&symb=gld&x=46&y=11&time=7&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
On the other hand, HUI hasn't even come close to posting a new 6 month high.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=hui&x=42&y=7&time=7&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11
So the market is telling us that the rally in GLD is a BIG mistake and mark my words, the gold stocks (HUI/GDX/GDXJ) will begin moving looower before GLD does. If you pull the GLD chart back to the 1 year time frame you will also see that the Dec 2016 low you spoke of in gold (GLD) wasn't low enough. Thus my take that this next move down coming will be "catastrophic" to say the least. I like GDX because you get a lot of chachingo for each dollar wagered and the bid/asked spreads are more than reasonable in the options. Plus you don't get screwed with "false pricing" in the options like you do with the shorty ETF's like DUST for instance.
lots of good work there. Wish my upvote for your comment was worth more. You need to add the joker to that deck of cards - cryptocurrency
I'm tracking bitcoin via GBTC, which trades on the OTC market. It trades enough volume to get a decent "sentiment" read. Most of the time it does anyway. I figger it will hang in here near this high to finish things off on a longer term basis. Methinks Bitcoin is going to have a "fat finger" down day in its near future similar to what ETH did recently. The OTC exchange traded "bitcoin tracker" GBTC already "pre-saged" a fat finger down move. Even I didn't notice it at first. :-) It shows up on this 1 year daily chart tho. That low is $262 in July.
http://bigcharts.marketwatch.com/advchart/frames/frames.asp?show=&insttype=&symb=gbtc&x=46&y=19&time=8&startdate=1%2F4%2F1999&enddate=2%2F18%2F2017&freq=1&compidx=aaaaa%3A0&comptemptext=&comp=none&ma=0&maval=9&uf=0&lf=1024&lf2=2&lf3=8&type=2&style=320&size=4&timeFrameToggle=false&compareToToggle=false&indicatorsToggle=false&chartStyleToggle=false&state=11