CONFIDENCE RETURNS! [MONEY FOLLOWS] (GS,GDX,IYT,FB,UUP)

Not even Donald Trump shoots from the hip like we do at Normandy.   You will not get any straighter answers delivered on things that matter, without all the blather and hype, as you do here.   And more than that, you get it with a dash of humor, too!   So count yourselves among the luckiest, and possibly richest sons’a’birches in the investment world.  And all thanks to us.  The planet’s wisest and humblest newsletter publishers. You’ll remember that some three weeks back we tipped you off regarding the market’s likeliest reaction to a Trump victory vs. a Hillary win.  We even drew a picture for you that the bigwigs in management decided to post on our website.   The chart looked like this – Now, there’s no need to repeat ourselves and comment a second time on the extreme genius at work here in the halls of the Normandy Mansion, Maryland’s chic-est corporate castle, situated in the heart of the east coast’s grandest neighborhood, a Gatsbean delight if there ever was one.   But you no doubt noticed that the left hand chart that we developed prior to the election bears a striking – some would say ‘eerily…

Read More

400 Decibels and Climbing (GDX,AAPL)

It’s another case of the circus noise masking the thieves’ million dollar getaway.   Who, after all, could hear the sound of that drill working behind the elephant cage amidst all that racket? It’s always been that way.  The news on the tube and in the papers trumpets WAR! FRAUD! MURDER! or RIOT! and the market is meantime smashing through its old highs while no one’s paying attention.   Call it textbook ‘wall of worry’.   The market is now drifting sideways, but we expect the post-election thunder, with its eternal debriefing and shrill accusation and counter-accusation to mask the rally that inevitably ensues.   You can count on it.   We’re just warming up.   Real Good News on the Way?   It’s always hard to judge your team midseason.  Everyone’s hopeful that the playoffs are a certainty and a championship year is within reach.  So it is, too, with earnings season.  Every new quarter brings investors renewed hope that the S&P will crush estimates and the markets will soar.   And that’s where we are now.   Here’s a look at the current quarter’s beat rate for earnings and revenues and – lo and behold! – what’s it…

Read More

Icing the Miners (GDX,DB,QQQ)

We’d be remiss if we didn’t address the latest action in the precious metals, a move that resembles Azi Avoolae’s chilling dive off the Little Tree Raft into the Niagara Gorge in 1919. Old Azi was said to have debts he couldn’t pay.  Despite his apparent wealth, the man had taken a liking to the finest Germanic folk apparel – both men’s and women’s, they say – a development his family wouldn’t tolerate.   And he couldn’t afford.   As for gold, the metal’s latest swan dive does significant technical damage to the chart and likely puts it on a sideways to lower path for some time to come.   Let’s have a look at the SPDR Gold Trust (NYSE:GLD), the largest bullion ETF on the planet, and a bellwether of the status of gold amongst Main Street investors – The takeaway is like this –   A three month declining triangle (in red) is a negative development, a matter of when, not if, a breakdown will occur. It’s evidence that the bulls are losing the ability to push back against the force of the sellers.  And in this case, the break came Tuesday of this week, when GLD succumbed…

Read More

Golden Roadblock Dead Ahead (GDX)

A few important developments to discuss before we move on to our trade for the week.   We start with the VIX, the CBOE’s widely-watched implied volatility indicator.  Sometimes called the ‘fear gauge’, the VIX of late has been manifesting anything but fright.  Call it mirth or good cheer, maybe giddiness or gaiety, but fear we don’t see.  Have a look – As of last Friday, the VIX had plumbed new lows for the year, indicating traders expect higher prices for the S&P 500 over the next thirty days.   And is that a good thing?   Could be.   Trouble is, the VIX is also used by many as a contrary indicator, as it generally signals market turns when it hits extremes.   So we sell now?   Well, not so fast, Schumpeter.  The idea is first to identify the extreme reading, and the truth is, these can only be known in retrospect.  That is, the VIX could continue to drift down from today’s 52 week lows toward an 11 read or even lower, should the market continue on its merry, helium-sucking, skippady-doo-dah way toward the wizard.   Conclusion: VIX may be getting close to signaling a top in…

Read More

Drilling Down to the Bond Core (TLT,UUP,GDX)

Before we jump into the fray this week and send you reeling with our ever colorful prose and one-handed, market-beating prowess, we’re going to take a moment to report on two trades that require attention.   The first was launched on the 13th of August in a letter called We’re Selling the Bond Rally, wherein we advised you to make two separate trades. The first was the sale of CALLs on the iShares 20+ Year Treasury Bond ETF (NYSE:TLT).   The reason for the advice was purely technical. We wrote –   After a very sharp bounce higher that coincided with equity market weakness, TLT has risen to its 137 day moving average…and we have good reason to believe that the rise will end precisely there. Why? Because the 137 day moving average has proven itself the workhorse in the moving average arena, reliably marking key resistance and support levels time and time again. And because it turned over in early June and has now been gathering momentum on the downside, we feel there’s little hope for a TLT breakout above that line at this juncture…   As it turned out, we were dead on. The CALLs expired worthless for…

Read More

Helen Roper’s Revenge (FAS,GS,TLT,GLD,UUP,GDX,KWHIY)

The old lady’s loose flowing garments were testimony to her growing brood of kids and the tendency, as one gets older, to pay less attention to the body’s need for dietary discipline.   We’re speaking, of course, of everyone’s favorite landlady (and Stanley’s wife), Helen Roper, who in many ways characterizes the investment landscape we’re now passing through.   Helen, you’ll recall was a product of the post-war generation’s affluence and the yearning of many aging folk in the 60’s and 70’s to reconnect with their inner child and lead a more fancy-free, shame-neutral life than their parents.   A Generation of Teens   So, too, with us today, though we’ve taken Helen’s moral lassitude and free-thinking, love-me-dobedobedo to heights undreamt of in 1977.   And that’s also likely why our markets are so disconnected from reality, and will continue to be so until all of us have doffed for good the fat rings and frisky hairstyles of the late mamasita who never managed to get her Stanley.   Recovering from Vladimir   We’re now going to take a quick run through the trades we missed reporting while we were suspended in a borscht-induced hiatus this last quarter. We now…

Read More

Mine Cave-In! – Investors Buried! (GDX,TLT)

There’s a danger in being too attached to your investment portfolio, and we’ve written about it enough times here to skip belaboring it again.   Suffice to say that securities serve a defined purpose. They’re not spouses. They’re not lovers or children or dogs. They’re purchased in pursuit of greater wealth and happiness and are dispensed with when their prospects run dry.     That’s right, Rennie.   It’s been said countless times in Wall Street’s history, and yet still there are those who ‘believe’ in the securities they buy, whose zeal and faith for, say, gold, remains steadfast through it all.   And so it was last week, when we read an hysterical talkback to a less than interesting article on the future of the precious metals, which went as follows:   No analysis of the gold market is worth anything if it fails to address these questions:   — Are central banks in the gold market surreptitiously or not?   — If central banks are in the gold market surreptitiously, is it just for fun — for example, to see which central bank’s trading desk can make the most money by cheating the most investors — or is…

Read More

We’re Selling the Bond Rally (TLT,GLD,GDX)

  We want to discuss the bond market today because we believe it’s at an important inflection point. We’ll have a look at the chart of the long bond to begin with, then turn to some broader market currents to get our bearings for a trade.   But first, let’s address two trades that closed with a loss that now require your attention.   They’re two initiatives that are essentially one – as you’ll shortly see.   Lead on, Maestro!   Last November 4th we launched a trade using the SPDR Gold Trust ETF (NYSE:GLD). Specifically, we recommended you sell the GLD December 121 CALL for $0.56 and the GLD February 100 PUT for $0.98, and buy the GLD June 100 PUT for $2.24. Total debit was $0.70 for the trio.   Two weeks later, in a letter called The Truth about Supply and Demand, we recommended you purchase a second GLD 100 PUT for $1.94.   Gold eventually tumbled, but, alas! from our perch back in November we underestimated just how long it would take to do so. Total loss on the trade was $2.64 in premium, but we’re not happy letting it go with that.   We’re going…

Read More

Gold Wins, and Gold Loses

The most dramatic moves in the market last week belonged to the precious metals and their associates, which jumped like a shocked rodeo steer as the dollar lost ground. The question now facing gold (and dollar) addicts is whether those moves were for real. Has the dollar’s relentless drive skyward now stalled? And will that trigger a sustained bull move for the precious metals, finally, after a four-year run through the investment world’s alley of septic horror? Nothing’s certain, but our take is like this… In the first place, there’s nothing that says the dollar and gold have to maintain a perfect inverse relationship at all times and through all markets. They won’t. There will be factors that either add to or detract from the general relationship, and that has to be kept in mind as we advance the discussion. The Dollar Remains Potent Second, both the fundamentals and technicals for the dollar remain bullish, despite the nearly month long decline we’ve just been through. The rest of the world’s major currencies are in the midst of substantial QE initiatives, all of which conspire toward dollar strength, and precious metals weakness. Three, the charts show a potential bottom now in…

Read More

Nothing in the Hole – Gold Miners Surface Empty handed! (GDX, GLD, SLV)

We’re witnessing some very contradictory developments on the precious metals front, which we believe it important to highlight today. But before we do, a word from a man for whom we have a great deal of regard. Not our loyal reader, Jimmie Rodgers, but rather many-time billionaire and former Soros attaché, sinophile and renowned gold bug – a man whose calls on the commodities market have been as good as any – Jim Rogers believes the time to begin buying gold again has not yet arrived. In a recent interview, he claims he’s still waiting on a buying opportunity and that the metal has a mind of its own: “sometimes it moves with the dollar, and sometimes it doesn’t.” As far as we’re concerned, the story on gold hasn’t changed. It’s a question of investor inflows and nothing more. It was investor inflows that drove the price toward $2000, and a lack of those same inflows that drove it lower these last four years to its $1140 bottom last November. Until investors get excited again about the metal, there simply ain’t nothing doing. We should be quick to add that a great deal of gold’s recent weakness has come at…

Read More

Powered by WishList Member - Membership Software
GET YOUR FREE SPECIAL REPORT:
"THE SEVEN DEADLY SECRETS OF CHINA"

GET YOUR FREE SPECIAL REPORT:

"THE SEVEN DEADLY SECRETS OF CHINA"

Enter your e-mail address to claim your FREE Special Report “The Seven Deadly Secrets of China”

You have Successfully Subscribed!