<< <i>When the financial markets begin to rise with irrational exhuberance again >>
I'm under the impression (albeit mine) that they already have. MJ >>
Worthless US$ inflates stock prices and the prices of most everything....so I'm not so sure the 'exuberance' theory exactly explains the high price of corporate stocks or hard assets. But that's not to say there's not some stampeding into stocks going on. But where else does one put their $s? >>
I do not see any irrational exuberance. I see money that has no better place to go. No one is out propping up individual stocks and talking about inane things like "cash burn rate" on stocks that are going up.
I hate to bring up Zimbabwe again, but as the ZMB economy was in shambles and inflation was rampant, the ZMB stock market soared. I don't think what we're seeing here is much different, just obviously not on the scale or at the same pace (yet).
<< <i> I do not see any irrational exuberance. I see money that has no better place to go. No one is out propping up individual stocks and talking about inane things like "cash burn rate" on stocks that are going up.
I hate to bring up Zimbabwe again, but as the ZMB economy was in shambles and inflation was rampant, the ZMB stock market soared. I don't think what we're seeing here is much different, just obviously not on the scale or at the same pace (yet). >>
I concur.
"Poets are the unacknowledged legislators of the world." PBShelley
Gold filled the gap at $1430 today left from Sunday's overseas open. But at the same time decided to head back and close out the GLD gap from today's open. It was odd that GSR actually fell during this morning's hit into the 37's. Other liquidity and volatility indicators agreed with the GSR. It seems that the miners and silver are trying to turn the corner. Miners pulled back to the 18 dma today (after dipping below it) so things are still slightly bullish. Momentum on GLD has actually dropped slightly over the past 2 weeks which is odd. Not sure what to make of that. GDX and SLV macd have at least moved upwards a little. I like the 3 day candle setup for GLD, SLV and GDX. TBond auctions for the week ended today. One last day for end of month/quarter. We'll see if things can start to turn more bullish. The hourly chart for now seems to be supporting that. Gold still in a range of $1405-$1445.
I thought GFI had the most compelling chart pattern this week so after the bounce off the uptrend line I picked some up. Nice ascending triangle along with a H&S. AUY has a similar chart as well. Some might call it a double top though.
Im still holding my long term GLD calls and ZSL, but losing patience. I HATE trending markets. This is not a market for traders. Im bored.
I actually cant wait till Friday and Baltimore. Havent been to a real coin show in 2 years. Im interested to see what type of coins are being bought and at what levels.
Roadrunner, why has GOLD been so weak. Looks like it is entering a support zone, but my momos are still lousy.
<< <i> Roadrunner, why has GOLD been so weak. Looks like it is entering a support zone, but my momos are still lousy. >>
I do slightly like where the HUI is at the moment. It's in a more bullish position than gold. Just gave a nice "3 rivers" formation as well on the last 3 daily candles. Also showing rising volume and a bounce off the 20 dma. GDX to SPY volume ratio has been increasing over the past 2 weeks which is a good sign. Maybe miners leading gold? A see a number of better miners starting to pick up the pace (THM, GFI, NAK, GRS, HMY, AU, UXG, ANV, RIC). Since August, the HUI is traced out a nice symmetrical triangle with 4 points. It's now knocking on the upper side. Inside that triangle is a nice H&S. While I can see that momentum has dropped off, it's also been coiling like most other indicators (exhibiting lower highs, but also higher lows). Accumulation, rate of change, etc. are all upwards. In summary you could basically call the last 6 months of GDX a large diamond pattern, not that much unlike a similar pattern that oil broke out of last month. GDX gave us a test of the 200 dma in January, and then a retest this month following the Japanese quake. Maybe it's time to distance itself from that 200 dma for awhile?
GSR continues hang right around 38. I think the 10yr/2yr ratio is once again getting ready to turn which would indicate a trend change in gold again after it's been sideways to down for 1-1/2 weeks. My guess would be up. The gold to oil ratio has been declining since September, putting in a recent bottom in early March. There are finally some signs of negative divergences in momentum and volume ratio has gone from almost zero to "something." Maybe time to give gold a chance?
Other than gold putting in a methodical 5 month correction so far I'm not sure there is anything wrong with it. After 5 months I would suppose the momentum would be near lows. Hulbert just came out and said the sentiment index is at 67, very close to levels where corrections have usually followed. That seems odd since most of the blogs I follow seem generally neutral overall. Many gold bulls are fearfull of a drop back into the $1300's or lower...they are not onboard yet. Based on the 5 headed top we've seen since November gold could break out above this $1435 neckline and head to over $1500, or complete a more perfectly symmetrical H&S pattern all the way back to November which would equate to the multiple-tested $1360 level. Gold is going to put everyone to sleep here. I don't think this move from August is over. It's just at the half way point with another $130 to add to the most recent low of $1380. If gold follows through with it's typical gain of >25% above the 200 dma, then $1650 is the target. The current H&S targets around $1565. The PM's seem to be tracing out the upside half of some cups. Copper is not playing right now and really neither are the grains and softs. As Hoye has stated gold and silver may linger longer as this 2yr "one-market" bull comes to an end this spring.
Plenty of signs of spring out there for gold. But I also know that it's at the end of a cliff coiling for a move. Only question is which way? It's been in a support zone for 5 months while putting people to sleep. The formations look bullish and suggest a 2/3 possiblity of an upward break, even if $1360 gets revisited first. Gold's jobs is to leave as many people at the station as possible. Seems like it's doing a good job. I'm sure some credit has to go the JP Morgue for "assisting" gold these past 5 months. This current 5 month topping" pattern with a tight lid at $1435-$1445 would be a first for gold in this bull market as usually it has exhausted itself with maniacal vigor.
Well, it was a good exercise for me. I find that trying to answer questions I often have to look in places I wouldn't have otherwise. Usually end of finding something of value and add to my experiences pile.
Rangold's mines are in Africa. And in particular their mine with the heaviest reserves is in the Ivory Coast. That's been under war-like conditions the past several months as the bosses battle for power. Needed supplies might not get to the mine. Gold production & sales? Not the best situation. But on the pragmatic side that stock ran very strong from 2003 to 2010 going from 5 to 105+. In fact it didn't even stall with many other miners (like IAG) at the Nov 2009 top. It finally peaked in October 2010. I suspect that was about the same time the civil strife picked up. Stock has become dirt cheap, a number of times the past 2 months. I think it bottomed at 70 after a lengthy 5 waves down. Once conditions improve in the country it will probably rebound sharply. But it outlasted most of the miners during that 7 year run and only needed a "reason" to get beat down like everyone else had. In this case a 34% beat down. Makes one think hard about where your miners are mining.
Boy, I guess I don't follow the main stock markets close enough. Just realized today that the Nasdaq is at all time highs. The Russell is just shy of its ATH. And since the dollar is roughly unchanged from Oct 2007 to March 2011, those levels are comparable.
Thanks for the analysis RR. Reports do show that interest in gold is lacking (for example, GLD ETF holdings are "low"), but it is healthy in silver. I don't know what exactly to make of that. Nichols is still bearish, and although he has tended to be right in the past, I have my serious doubts. But I do see anecdotal signs that once reported on in the media could actually send metals down for a correction... I am a Realtor here in Phoenix, as you all know, one of the worst areas for the real estate collapse. But lately sales have been brisk, and competition fierce. Sales are active in many different price ranges, although more so the lower the price. Whereas at one point for sub $200k homes and especially ~$100k homes, I would advise clients to offer considerably less than asking to test the waters. Lately, if you do so you will lose the property to a better bid or you will be given a chance to put in your "highest and best." Restaraunts lately have seemed busy, and my wife reports that the mall was packed last weekend, although we don't go often enough to really note that this is unusual.
To take it a step further, where I work my department which spans several locations nationwide had a planned attrition rate for the year. Management is now very concerned that we are very much AHEAD of plan for attrition, which indicates that people are most likely leaving our company for supposedly better positions elsewhere, which means that employment and hiring may be on the increase.
So I know it's all anecdotal and my experience is mostly just Phoenix, and I know that it's all very temporary, but if the data starts to reflect any of these trends and the news picks up on it, gold will be in for some trouble. However, I do think asian buying will support gold and keep it from falling too far.
For the near future, I'm still looking for gold to make up it's mind and pierce 1410 or 1440 decisively.
The CEO put out a statement today along with the annual report saying they were effectively working around the civil war and that producton guidance was on target. The stock got a nice bump today back to the 50 dma. Hope you bought some Dave because it's up a whopping 7.5% this morning. Nice! Your comment on the stock was most opportune as GOLD broke above it's 6 month/6 point downtrend channel. Ended up >10% for the day leaving an island behind in its wake.
Rubicon (Rby) announced an update to their questioned inferred resources today. Net effect was only a -10% change which is minor. The stock promptly opened +5% on the news. It had jumped 33% in one day back in late November when it issued a resource estimate (NI43-101). It then lost all of those gains because of the normal downturn plus the fact that "someone" tattled to the BCCS that the estimate was possibly flawed. This latest news puts all that to bed. I was fortunate to pick up some shares this week after realizing that eventually news was going to be put out, and more than likely the estimate would be about the same. It didn't hurt that it had completed a 6 point rectangle, a rebound, then another test of the 200 dma. But I had no idea the news might come out this week. Reread some articles this week on how the original estimate was done. Things seemed on the up and up especially since the expert who did the estimate is very well thought of in the industry. When I saw the 10% pop on the open this morning I figured a report might have come in. Was tempted to buy more shares, but by the time I confirmed the news, it had jumped another 5% in 5-10 min. Now 15 minutes later it's up another 5%. Should have gone with my gut feel and bought more on the initial jump knowing that 10% was not going to cut it when a 30% jump occured the first time around. And now too late as it's +20%. A good lesson learned. In hindsight, the news was on the street at around 9 am so there was time to forumulate a plan. Even having a 30 day "stop-limit" buy order might have been a decent strategy knowing it was going to happen soon enough. Good training in any case.
The stock gapped up today. Now the question if it might eventually fill that. Doesn't matter, I took the easy profit and sold off. It was already quite a bit above the daily BB. Rubicon might be headed for $7 and it's a great takeover target for Goldcorp and others. There are other mining stocks that are more attractive pricewise right now.
Silver putting in a nice symmetrical diamond shape over the past 20 hrs projecting to about 38.20 if it breaks upwards. Since oil has been the leader recently I would think the PM's would follow oil's lead (now at $107). But probably some BLS jobs report shenanigans in the morning to push silver and gold back down if just momentarily. It is April's Fools.
Nice to see GLD turn back upwards on rising volume today and getting the stochastics going back up rather than down. The volume ratio of GLD/SLV was indicating much higher % action in GLD vs. SLV than normal. The accum/distrib of GLD went sharply down today contrary to the direction in SLV and GDX. Could be because GLD gapped up on gold's overnight rise, and it was continually sold off during the day.?? Same basic trend was seen in many of the senior miners with CMFlow decreasing again today (particularly noteworthy in AUY). GLD, SLV also showing decreasing money flows. Is this something possibly attributable to end of quarter squaring up?
Newcrest also has a mine in the Ivory Coast at as of today it suspended operations due to security reasons. It has done so in past as well. Probably not a producing mine like Rangold.
If the leftist candidate gets in it could mean more taxes and restraints on miners and economic growth. At least over the past 3 days the EPU has rebounded. It may have put in a 5 month bottom. Peru is the world's leading copper mining nation. Freeport, Southern Copper, Buenaventura, and others have stakes in Peru. 3 weeks until the election.
Comments
earnings are big but a concern is what about next quarter?
efficiencies have created earnings, but growth is???? (except APPL i guess)
<< <i>
<< <i>
<< <i>When the financial markets begin to rise with irrational exhuberance again >>
I'm under the impression (albeit mine) that they already have. MJ >>
Worthless US$ inflates stock prices and the prices of most everything....so I'm not so sure the 'exuberance' theory exactly explains the high price of corporate stocks or hard assets. But that's not to say there's not some stampeding into stocks going on. But where else does one put their $s? >>
I do not see any irrational exuberance. I see money that has no better place to go. No one is out propping up individual stocks and talking about inane things like "cash burn rate" on stocks that are going up.
I hate to bring up Zimbabwe again, but as the ZMB economy was in shambles and inflation was rampant, the ZMB stock market soared. I don't think what we're seeing here is much different, just obviously not on the scale or at the same pace (yet).
<< <i> I do not see any irrational exuberance. I see money that has no better place to go. No one is out propping up individual stocks and talking about inane things like "cash burn rate" on stocks that are going up.
I hate to bring up Zimbabwe again, but as the ZMB economy was in shambles and inflation was rampant, the ZMB stock market soared. I don't think what we're seeing here is much different, just obviously not on the scale or at the same pace (yet). >>
I concur.
I thought GFI had the most compelling chart pattern this week so after the bounce off the uptrend line I picked some up. Nice ascending triangle along with a H&S. AUY has a similar chart as well. Some might call it a double top though.
Gold Fields
roadrunner
I actually cant wait till Friday and Baltimore. Havent been to a real coin show in 2 years. Im interested to see what type of coins are being bought and at what levels.
Roadrunner, why has GOLD been so weak. Looks like it is entering a support zone, but my momos are still lousy.
Knowledge is the enemy of fear
<< <i> Roadrunner, why has GOLD been so weak. Looks like it is entering a support zone, but my momos are still lousy. >>
I do slightly like where the HUI is at the moment. It's in a more bullish position than gold. Just gave a nice "3 rivers" formation as well on the last 3 daily candles.
Also showing rising volume and a bounce off the 20 dma. GDX to SPY volume ratio has been increasing over the past 2 weeks which is a good sign. Maybe miners
leading gold? A see a number of better miners starting to pick up the pace (THM, GFI, NAK, GRS, HMY, AU, UXG, ANV, RIC). Since August, the HUI is traced out a
nice symmetrical triangle with 4 points. It's now knocking on the upper side. Inside that triangle is a nice H&S. While I can see that momentum has dropped off,
it's also been coiling like most other indicators (exhibiting lower highs, but also higher lows). Accumulation, rate of change, etc. are all upwards. In summary you
could basically call the last 6 months of GDX a large diamond pattern, not that much unlike a similar pattern that oil broke out of last month. GDX gave us a test of
the 200 dma in January, and then a retest this month following the Japanese quake. Maybe it's time to distance itself from that 200 dma for awhile?
GSR continues hang right around 38. I think the 10yr/2yr ratio is once again getting ready to turn which would indicate a trend change in gold again after it's been
sideways to down for 1-1/2 weeks. My guess would be up. The gold to oil ratio has been declining since September, putting in a recent bottom in early March. There
are finally some signs of negative divergences in momentum and volume ratio has gone from almost zero to "something." Maybe time to give gold a chance?
Other than gold putting in a methodical 5 month correction so far I'm not sure there is anything wrong with it. After 5 months I would suppose the momentum would
be near lows. Hulbert just came out and said the sentiment index is at 67, very close to levels where corrections have usually followed. That seems odd since most
of the blogs I follow seem generally neutral overall. Many gold bulls are fearfull of a drop back into the $1300's or lower...they are not onboard yet. Based on the
5 headed top we've seen since November gold could break out above this $1435 neckline and head to over $1500, or complete a more perfectly symmetrical H&S pattern
all the way back to November which would equate to the multiple-tested $1360 level. Gold is going to put everyone to sleep here. I don't think this move from August
is over. It's just at the half way point with another $130 to add to the most recent low of $1380. If gold follows through with it's typical gain of >25% above the 200 dma,
then $1650 is the target. The current H&S targets around $1565. The PM's seem to be tracing out the upside half of some cups. Copper is not playing right now and
really neither are the grains and softs. As Hoye has stated gold and silver may linger longer as this 2yr "one-market" bull comes to an end this spring.
Plenty of signs of spring out there for gold. But I also know that it's at the end of a cliff coiling for a move. Only question is which way? It's been in a support zone for
5 months while putting people to sleep. The formations look bullish and suggest a 2/3 possiblity of an upward break, even if $1360 gets revisited first. Gold's jobs is to
leave as many people at the station as possible. Seems like it's doing a good job. I'm sure some credit has to go the JP Morgue for "assisting" gold these past 5 months.
This current 5 month topping" pattern with a tight lid at $1435-$1445 would be a first for gold in this bull market as usually it has exhausted itself with maniacal vigor.
roadrunner
BTW--Like the analysis
Knowledge is the enemy of fear
Well, it was a good exercise for me. I find that trying to answer questions I often have to look in places I wouldn't have otherwise. Usually end of finding something of value
and add to my experiences pile.
Rangold's mines are in Africa. And in particular their mine with the heaviest reserves is in the Ivory Coast. That's been under war-like conditions the past several months as the
bosses battle for power. Needed supplies might not get to the mine. Gold production & sales? Not the best situation. But on the pragmatic side that stock ran very strong from 2003 to 2010 going from 5 to 105+. In fact it didn't even stall with many other miners (like IAG) at the Nov 2009 top. It finally peaked in October 2010. I suspect that was about the same time the civil strife picked up. Stock has become dirt cheap, a number of times the past 2 months. I think it bottomed at 70 after a lengthy 5 waves down. Once conditions improve in the country it will probably rebound sharply. But it outlasted most of the miners during that 7 year run and only needed a "reason" to get beat down like everyone else had. In this case a 34% beat down. Makes one think hard about where your miners are mining.
Boy, I guess I don't follow the main stock markets close enough. Just realized today that the Nasdaq is at all time highs. The Russell is just shy of its ATH. And since the dollar is roughly unchanged from Oct 2007 to March 2011, those levels are comparable.
roadrunner
To take it a step further, where I work my department which spans several locations nationwide had a planned attrition rate for the year. Management is now very concerned that we are very much AHEAD of plan for attrition, which indicates that people are most likely leaving our company for supposedly better positions elsewhere, which means that employment and hiring may be on the increase.
So I know it's all anecdotal and my experience is mostly just Phoenix, and I know that it's all very temporary, but if the data starts to reflect any of these trends and the news picks up on it, gold will be in for some trouble. However, I do think asian buying will support gold and keep it from falling too far.
For the near future, I'm still looking for gold to make up it's mind and pierce 1410 or 1440 decisively.
The CEO put out a statement today along with the annual report saying they were effectively working around the civil war and that producton guidance was on target.
The stock got a nice bump today back to the 50 dma. Hope you bought some Dave because it's up a whopping 7.5% this morning. Nice! Your comment on the stock was
most opportune as GOLD broke above it's 6 month/6 point downtrend channel. Ended up >10% for the day leaving an island behind in its wake.
Rubicon (Rby) announced an update to their questioned inferred resources today. Net effect was only a -10% change which is minor. The stock promptly opened +5% on the news.
It had jumped 33% in one day back in late November when it issued a resource estimate (NI43-101). It then lost all of those gains because of the normal downturn
plus the fact that "someone" tattled to the BCCS that the estimate was possibly flawed. This latest news puts all that to bed. I was fortunate to pick up some shares
this week after realizing that eventually news was going to be put out, and more than likely the estimate would be about the same. It didn't hurt that it had completed a 6 point
rectangle, a rebound, then another test of the 200 dma. But I had no idea the news might come out this week. Reread some articles this week on how the original estimate
was done. Things seemed on the up and up especially since the expert who did the estimate is very well thought of in the industry. When I saw the 10% pop on the open this
morning I figured a report might have come in. Was tempted to buy more shares, but by the time I confirmed the news, it had jumped another 5% in 5-10 min. Now 15
minutes later it's up another 5%. Should have gone with my gut feel and bought more on the initial jump knowing that 10% was not going to cut it when a 30% jump occured
the first time around. And now too late as it's +20%. A good lesson learned. In hindsight, the news was on the street at around 9 am so there was time to forumulate a plan.
Even having a 30 day "stop-limit" buy order might have been a decent strategy knowing it was going to happen soon enough. Good training in any case.
The stock gapped up today. Now the question if it might eventually fill that. Doesn't matter, I took the easy profit and sold off. It was already quite a bit above the daily BB.
Rubicon might be headed for $7 and it's a great takeover target for Goldcorp and others. There are other mining stocks that are more attractive pricewise right now.
Rubicon chart
roadrunner
the PM's would follow oil's lead (now at $107). But probably some BLS jobs report shenanigans in the morning to push silver and gold back down if just momentarily. It is
April's Fools.
Nice to see GLD turn back upwards on rising volume today and getting the stochastics going back up rather than down. The volume ratio of GLD/SLV was indicating much higher % action in GLD vs. SLV than normal. The accum/distrib of GLD went sharply down today contrary to the direction in SLV and GDX. Could be because GLD gapped up on gold's overnight rise, and it was continually sold off during the day.?? Same basic trend was seen in many of the senior miners with CMFlow decreasing again today (particularly noteworthy in AUY). GLD, SLV also showing decreasing money flows. Is this something possibly attributable to end of quarter squaring up?
Senior miners - CMF
Newcrest also has a mine in the Ivory Coast at as of today it suspended operations due to security reasons. It has done so in past as well. Probably not a producing mine like Rangold.
Peru elections having effect on their markets over next 3 weeks - miners in particular
If the leftist candidate gets in it could mean more taxes and restraints on miners and economic growth. At least over the past 3 days the EPU has rebounded. It may have put in a 5 month bottom. Peru is the world's leading copper mining nation. Freeport, Southern Copper, Buenaventura, and others have stakes in Peru. 3 weeks until the election.
roadrunner