Sentiment is still dead neutral on gold. I’d like to see it at least below 40% before I try to call an ICL.
And bullish percent isn’t oversold yet. If we can get down to 20% or less then metals will be oversold. If we were to exacerbate the selling with a stock market crash into a 4 YCL we could see bullish percent go to 0.
I almost never buy individual stocks, but NEM has been attacked relentlessly for the last year and a half and price is stretched way too far below the 200 WMA. Once we get a final bottom this one will be primed for a large regression event back above the mean. There is major support around the $28 level. FNV is another miner that has big upside potential.
Comments (52)
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Rich is there a way to chat with you after you leave SMT? My email is Mattramsey888@gmail.com
Number Two
Thanks Gary
hey Gary thanks.
as far as the 4 year cycle low in stocks- are you referring to the s&p, nasdaq, etc and not gold and/or commodities?
sorry just reread the post and found the answer
FNV is royalty company and not exposed to rising costs in mining.
Correct. It’s not a miner in the normal sense, similar to RGLD, WPM, & SAND.
âŠ. add OR to that list.
There is so much FOMO going on right now still. I feel like the metals people are seeing the stock market go up relentlessly and they want that action so bad in their field too. So many think some out of the blue $200 move through the highs is imminent.
I certainly haven’t a clue but major bullishness still in the metals sector. It’s been good practice waiting to find better signals
naciente
Price is the Ultimate Judge of Markets. If so much FOMO please explain the low Premiums on PMs , Gold/Silver Ratio, and the 2024 beatdown on Mining shares.
Hi Kyle,
Obviously this was in reference to bugs. The vast majority of people don’t even know gold exists at the moment đ even as we press up against all time hugs in usd and have already broken out in countless currencies.
Maybe tomorrow price will have jumped 2 bills and we can be on our way.
would USO and OIH get dragged down to 4 YDL with stocks?
I think it might depend on what triggers the 4 YCL. If it’s an escalation of the two wars spreading into new regions then both gold and oil might surge will stocks tank.
Cinco de Gary !đ⊠plus 1
đŸđŸđŸđŸđŸ plus đŸ
yep 2 allđ
Gary, if SM goes higher, will you provide a new stop level for us or should we do that on our own? Perhaps a trailing stop or a higher resistance zone than we have now?
A workable plan would be to maybe take profits at 5000 SPX, then wait for the DCL before deciding if you want to keep playing the long side with a stop below the second DCL.
Gary, new subscriber here. I know you’re not a huge fan of the miners (unless they continue to pullback to a certain level). Do you actually buy physical metals or just buy the physical funds and etfs? And how long and how high do you expect gold and silver to run before they start to significantly correct? Thanks
My recommendation is to put the majority of your capital in physical gold and silver. You won’t be tempted to over trade and you won’t panic sell during corrections.
I think a reasonable target once we get a breakout above $2100 would be $2300-$2500. At that point price would be stretched above the long term averages and in need of a correction.
Thanks. Just to test your timescales some are calling for $3000 to $5000 gold and $300 silver over the next 5-10 years. Are in that camp? I’m willing to lock it away for that length of time if they are prices are going to those levels over the long term (assuming stocks don’t provide a better return)
Yes before the bull market is done I think $5000 gold is probably way too conservative.
Great thanks. Silver will no doubt do extremely well then
Investing in Silver for years is really a waste of time .I’m in Silver for last 10 years and it goes nowhere .Gold and real estate is far more better than Silver .
Everyone says Silver will go 50-100-200 but time frame is much bigger .
Maybe this piece of cake will be for ur Children or Grandson or great Grandson .
Land r better than Silver as growth is sure and r not manipulated .
Nonsense. The move is going to happen during this 8 year cycle.
Hi Gary,
Just checking we’re still on track with The Plan:
So we’re currently deep in oil (on the understanding that it’ll wiggle its way upwards over the next few weeks), and then we jump out of oil and into gold somewhere around April/May?
My worry is that we get stuck in a depressed oil market and exit in the red; to go into gold earlier than expected…
Hi Gary,
What would be your price point on Silver if everything plays out as you hope for?
I am 90% silver / 10% gold when it comes to physical.
Wandering should I have that more like 50 / 50 and get more gold or silver has more potential?
I’m approaching 50/50 on my personal physical holdings.
50/50 as in $ for $, or as in oz for oz?
(i.e. have you spent $500 on Au and $500 on Ag, or bought 5oz Au and 5oz on Ag?)
Definitely not the same in oz as gold is 10 x more. When it comes to $, 50/50% I would assume is the right way to think as oz to oz so much difference in price
OK yes, that makes sense, thanks! đ
Gary,
When the time comes, NEM and FNV comprise 20% of GDX holdings.
Close enough?
Thatâs a very good point!
I’ve seen several known investors saying they are looking for 5000 spx to start short position. đ€
The final interview this weekend of the 3 most influential figures in the world is tonight. Trump interview Sunday, Putin,( transcipt being released piecemeal today) and Jerome Powell tonight.
And all three will make for an interesting read!
Powell, however, will be served up with a large grain of salt.
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“Past 6 months data isn’t conclusive and we need to observe more data in coming months to ensure inflation is under control”.
“I ain’t going to cut that early, not March, unless banks are in deep shXt. No fxxking way I’ll let inflation to jeopardize my marvelous financial engineering of Soft Landing”
Thank you Gary.
reco the entire #Uranium conference @ the Bloor Street Capital you Tube channel:
Gary among all the mining companies out there do you tend to prefer the Royalty companies over them or just the Major royalty companies like FNV?
13D today:
Mounting divergences in the U.S. economic data and the stock market.
Given the U.S. presidential elections in November, investors and traders are likely to encounter greater-than-usual âpolitical spinâ regarding the economic data. Listening to the markets and closely scrutinizing the price-action, divergences, anomalies, and the marketâs âreaction-to-the-newsâ will be critical.
As we wrote in a recent issue: âBased on our assessment of the Big Patterns, long-term âset-upsâ and key indicators, which we have discussed in previous issuesâ2024 could feature critical inflection-points for several markets and trends, and the U.S. economy.â
Mounting divergences in the U.S. economic data.
Fridayâs payrolls report showed a huge âbeatâ, as the economy added 353k jobs in January, according to the Establishment survey. The Household survey showed a loss of 31k jobs in January. In the last 3 months, the difference is +289k jobs versus -43k jobs, respectively.
In a X/Twitter post Friday, @NickTimiraos, called the âFedâs mouthpieceâ, noted: âThe index of aggregate weekly payrolls for private-sector workers, which combines hiring, wages, and hours, rose at its slowest pace of the current cycle in January. Wage growth firmed but hours worked dropped a lot. The 12-month rate slowed to 4.7% in January from 5.9% in December.â
Average weekly hours fell in January to 34.1, a relatively large decline from the prior month and the cycle peak of 35.0. And the monthly decline is on pace with what usually occurs in a recession. Average weekly hours have fallen steadily over the past two years and now match the March 2020 levelânear the lowest level in over a decade. This suggests the headline jobs data in the Establishment survey could be overstating the health of the labor market.
As Dr. Lacy Hunt noted in an interview with 13D last June: âThe reduction in the work week is more powerful than the jobs added.â
The divergence between GDI (Gross Domestic Income) and GDP continues, as of the latest GDP revisions reported by the BLS in November. Annualized GDI has only been negative at the same time GDP was positive twice before, in 2001 and 2007. Each instance was followed by a âhard landingâ in the U.S. economy.
Mounting divergences in the U.S. stock market.
The list of divergences in the stock market are too numerous to recount here, and they continue to grow.
On Friday, the S&P 500 was up 1.07% and two-third of the stocks on the NYSE were down. And Friday was a 61% âdownside-volume dayââas downside volume exceeded upside volumeâextremely unusual on a day when the S&P 500 made a new all-time high.
On January 19th when the S&P 500 closed at an all-time high, the Russell 2000 was still down more than 20% from its high. That has never happened before, according to @jasongopfert on X/Twitter.
Thank you cpgarcia. This is very useful.
Thanks CP
Appreciated
Bear Traps today:
We have a few close friends in our chat that worked with the Stan Druckenmiller. Back in the day, Stan would spend many late-night hours studying divergences in the equity market and called those anomalies his favorite economist. A month ago, there were very few standouts in this regard, just about all stocks were going up together. That changed dramatically in the last 10 days. The Streetâs economists are lecturing us â âthe U.S. economy is re-acceleratingâ – they are shouting these words from the rooftops. If that is the case, then why do we see so many âthings that make you go, hmmm?â
There is significant weakness building in parts of the Dow Transports. UPS is close to 35% off its highs vs. 32% off during the depths of the Covid-19 panic, and a 38% drawdown at the worst point of the 2001 recession. At the same time, the largest bank in the USA is near all-time highs while the 5th in size is in the throes of a -30% beating. In US high yield, CCCs are close to 50bps wider since December vs. the S&P 500 400bps higher. In most sustainable bull markets, CCCs should outperform. On a price basis, the JNK ETF is -62bps off its December highs, trailing the S&P by a wide margin as well. In consumer credit, American Express AXP is at all-time highs vs. Discover DFS, Synchrony Financial SYF, Credit Acceptance CACC, and Capital One COF are all 17-20% off their highs. The last time Challenger jobs cuts were this high in the financial sector, the VIX was approaching 36 vs. sub-14 today. This smells to high heaven and is NOT something you should see in a strong â sustainable bull market. If the economy is sound why are consumer staples â recession-resistant equities – outperforming consumer discretionary names by close to 500bps since December 19th? Equities with exposure to commercial real estate are -15 to -25% off their January highs and NYSE breadth â the spread between winners and losers in the market is deteriorating at a brisk pace. If the economy is re-accelerating, NBC shouldnât be telling us this weekend that President Biden trails Donald Trump on major policy and personal comparisons, including a jaw-dropping 20 points on which candidate would better handle the economy.
As one client noted in the chat, âMarch 2023 was all about interest rate risk. This year will be far more about credit risk.â Yellen and Powell were able to arrest interest rate risk with two weapons. The BTFP facility did the banks a huge favor. Putting troubled loans over to Jay Powell at par (100) is a tasty treat indeed. The US Treasury has pulled volatility out of the market by selling trillions of USD T-Bills that really donât move much in price, while long-dated US treasury bonds are down 20-30 points. They can suppress interest rate risk with these tools and have, but credit risk is a different animal. We have been selling down our tax loss basket and raising cash. Equity volatility (VIX) is extremely cheap here relative to near-term risks. The probability of a near-term reversal in the S&P 500 is high.
Thank you for all these data points
Hope it helps!
Thank you. It helps not just with the current scenario but I recorded some of these to get more insights into the markets.
This divergence certainly is alarming (probably not to most retail traders as they continue to chase the high flyers).
I’m curious how many of them are chasing NVDA 21Feb2024 earning.
“Would you like Titanic and Hindenburg Omen with your popcorn?”
Should we buy oil al 72?
Gary, thanks so much for clear and concise weekend report and especially for the insight on the individual miners which is most appreciated. It is useful to have insights on individual stocks/charts also because we would learn a lot more just because there are more charts. Also a request to cover some basic cryptos if possible.
gary,
where is sentiment currently on the SM? short-term and intermediate-term.
Excessively bullish.