The Fed Continues To Spike The Punch But NEM Dramatically Underperformed Today

Looking at the Fed's Temporary Open Market Operations (see link below), they spiked the punch yesterday with a very large $16.75 Billion in credit in the form of Repurchase Agreements (Repos) and today was a spike move in SPX and the affected indexes that include XAU and HUI. Today's Repo was a below average (for recent weeks) $5.75 Billion which means the likely weakness on Monday portended by NEM underperforming the XAU by a very bearish -1.46% today is a slam dunk.

In recent weeks we've seen how important SPX (S & P 500) is because it drives index fund trading that has a profound affect on many indexes including HUI/XAU. Now, in the form of Fed Credit/lending, we can see how much $ is fueling index fund trading. The daily and weekly deltas (changes) are what matter. Federal Reserve Bank Credit appears to be a very reliable short term cycle indicator that must be used with cycle channels/trendlines.

http://www.ny.frb.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE