Barrick (ABX) And Fed Credit Held Things Together Last Week
If it wasn't for Barrick's strong performance since releasing a good earnings report and the Fed's punch spiking the past 5 sessions, http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE, the gold/silver stock market would have been much weaker.
The XAU put in a monthly cycle high on Friday. HUI put in a monthly cycle high on Wednesday, and, NEM hit a monthly cycle high on Monday 5-1, leading as usual. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=
The Fed spiked the punch as they always seem to do on Thursday, with a massive $19.25 Billion in Repos. The prior few days were respectable also and today was a large $9.25 Billion 1 day Repo. It appears to be plunge protection at work, but all it did was delay the process and resulted in modest additional upside for HUI/XAU: http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE
A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.46193 today and XAU Implied Volatility closed at 35.415 on Friday, which is a very high level of fear.
The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle. Today's upside gaps at 56.43 for NEM and 161.89 for the XAU are probably breakaway gaps that won't get filled until the next monthly upcycle.
The NEM Lead Indicator is a modestly bullish +0.25% vs the XAU right now, was a slightly bullish +0.10% vs the XAU on 5-5, was a very bearish -1.00% vs the XAU on 5-4, was a very bearish -1.53% vs the XAU on 5-3, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28.
The latest COT data (as of 5-2-06) is short term bearish/mixed since the gold Commercial Traders traded net short, but the gold Speculators also traded net short, which portends some strength as does the Commercial Traders' long trade, but much of the strength probably occurred last week because the data is three days old when released and gold spiked substantially higher in recent weeks. The gold Commercial Traders added 5401 long futures and options contracts and added 7399 short futures and options contracts which portends weakness this week (non contrarian indicator), but the long trade points to some strength. The gold Speculators (hedge funds and other speculators/traders) added 1712 long futures and options contracts and added 2330 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released, and the long trade points to some weakness.
There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/
The XAU put in a monthly cycle high on Friday. HUI put in a monthly cycle high on Wednesday, and, NEM hit a monthly cycle high on Monday 5-1, leading as usual. See: http://finance.yahoo.com/q/ta?s=%5EXAU&t=5d&l=off&z=l&q=c&p=&a=m26-12-9,p12,fs,w14&c=
The Fed spiked the punch as they always seem to do on Thursday, with a massive $19.25 Billion in Repos. The prior few days were respectable also and today was a large $9.25 Billion 1 day Repo. It appears to be plunge protection at work, but all it did was delay the process and resulted in modest additional upside for HUI/XAU: http://www.newyorkfed.org/markets/omo/dmm/temp.cfm?SHOWMORE=TRUE
A great sign for the health of the major upcycle since 5-16-05 is that fear has spiked dramatically, which is an unusually large rise in fear that portends short term weakness for the next week or two, but is a major positive for the major upcycle. The XAU Put/Call Ratio (May expiration) is at an extremely high fear level = 1.46193 today and XAU Implied Volatility closed at 35.415 on Friday, which is a very high level of fear.
The XAU has downside gaps at 152.05 from 4-28, at 150.16 from 4-21, at 151.71 from 4-18, at 145.47 from 4-17, at 141.35 from 4-12, at 138.84 from 3-30, at 134.17 from 3-29, at Monday 3-27's open at 133.40 and one at 3-24's open at 130.03, and, NEM has downside gaps at 52.87 from 4-17, at 51.46 from 4-12, at 49.46 from 3-27, and at 49.24 from 3-24, some and maybe all of which will get filled in this monthly downcycle. Today's upside gaps at 56.43 for NEM and 161.89 for the XAU are probably breakaway gaps that won't get filled until the next monthly upcycle.
The NEM Lead Indicator is a modestly bullish +0.25% vs the XAU right now, was a slightly bullish +0.10% vs the XAU on 5-5, was a very bearish -1.00% vs the XAU on 5-4, was a very bearish -1.53% vs the XAU on 5-3, was a very bearish -1.46% vs the XAU on 5-2, was a very bearish -1.20% vs the XAU on 5-1, was a very bearish -1.10% vs the XAU on 4-28.
The latest COT data (as of 5-2-06) is short term bearish/mixed since the gold Commercial Traders traded net short, but the gold Speculators also traded net short, which portends some strength as does the Commercial Traders' long trade, but much of the strength probably occurred last week because the data is three days old when released and gold spiked substantially higher in recent weeks. The gold Commercial Traders added 5401 long futures and options contracts and added 7399 short futures and options contracts which portends weakness this week (non contrarian indicator), but the long trade points to some strength. The gold Speculators (hedge funds and other speculators/traders) added 1712 long futures and options contracts and added 2330 short futures and options contracts which portends strength this week (contrarian indicator), but much of the strength may have occurred last week because the data is three days old when released, and the long trade points to some weakness.
There has been a lot of NEM sell interest at Thomson Lycos I Watch for a few weeks: http://thomson.finance.lycos.com/lycos/iwatch/cgi-bin/iw_ticker?t=NEM&range=7&mgp=0&i=3&hdate=&x=11&y=11, and, the 3 month NEM Lead Indicator is extremely bearish: http://finance.yahoo.com/q/ta?s=%5EXAU&t=3m&l=on&z=m&q=l&p=&a=&c=%5Ehui,nem. 10-20%+ declines in HUI/NEM/XAU (from their monthly cycle highs) over the next few weeks are likely. As the major upcycle nears an end (July maybe) it makes sense for the 3 month NEM Lead Indicator to turn extremely bearish. ....... http://www.JoeFRocks.com/
posted by Joe Ferrazzano at
7:23 AM
