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Gold & Precious Metals

Rates Up - Gold Up - Why ???


Posted by Ross Norman - Sharps Pixley, London

on Thursday, 16 March 2017 09:56

To observers of financial markets it must seem odd that they often behave exactly the opposite to what is expected. Explaining it is also a strange thing too.

Essentially when the US Federal Reserve jawbones a potential move such as a rate hike (for the best part of a year), investor positioning is congruent with the expected outcome - that is to say dollar / equities up an by extension, gold down.

But what happens when they are too successful in leading the markets expectations and the market positioning is too extreme for the expected move. Well you have a heap of investors who are short gold and long the dollar / equities who don't get the win they expected... that is to say the move is over-priced into the news. As such, those investors - be they speculators in the futures markets or physical buyers who have forestalled their purchases for a hoped for price correction ... are vulnerable.

In this environment a little counter-intuitive buying of gold and selling dollar / equities is usually sufficient to frighten them into covering their position. In short, markets end up moving exactly the opposite way to how classic economics would tell us. And the move feeds on itself because of the extreme positioning. 

Evidence to support this view is gold's move over the last few rates increases - the 25 bps increase in December 2015 saw a subsequent 18% rise in gold over the following 3 months. Meanwhile the December 2016 rate rise saw an 8% increase over the next 3 months. Yesterdays rate rise has seen a 2.4% rise in gold so far ... and appears to be petering out. What this indicates is that the wonderful ruse by institutions who exploit predictable investor behaviour seems to be running its course.

So where do we go from here - well having been burned by behaving logically, presumably those investors who keep finding themselves "long and wrong" in dollar/equities and "caught short" in gold will be more perspicacious - a posh way of saying more wise and cynical. Ultimately we could just end up not listening at all.

Ross Norman

CEO

Sharps Pixley, London

https://www.sharpspixley.com/

...related, published prior to rate hike:

SWOT Analysis: How Will Gold React to the Next Rate Hike?



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Asset protection

Fanaticism, Stock Market Crash 2017 or Continuation of Bull Market


Posted by Sol Palha - Tactical Investor

on Wednesday, 15 March 2017 12:00

"A fanatic is a man that does what he thinks the Lord would do if He knew the facts of the case." ~ Finley Peter Dunne

Not too long ago this bull market was one of the most hated in history; that no longer appears to be the case. Throughout the unpopular phase of this bull market, we consistently and much to the dismay of many penguins, oops we mean experts, stated that every pullback should have been treated as a buying opportunity. There were two reasons for this; market sentiment was consistently negative, and the trend was up.

We even penned an article before Trump won stating that a Trump win like Brexit would prove to be a buying opportunity. As expected after the initial panic of having to deal with A Trump Presidency, the markets recouped their losses and never looked back. We were so bullish that on De 15, 2016 we provided our subscribers with the Path we expected the Dow to take in 2017.

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Personal Finance

One of the Most Effective Trading Tools for Investors


Posted by Mike Burnick via The Edelson Wave

on Wednesday, 15 March 2017 11:02

Screen Shot 2017-03-15 at 10.39.39 AMMy mentor and friend Larry Edelson had an uncanny ability to correctly identify market tops and bottoms.

This includes calling the 1987 stock market crash weeks in advance. Plus, the great bull market bottom in gold that began at $250 an ounce in 2001, and the bear market top at over $1,900 in 2011.

What’s Larry’s secret weapon that made him so prescient with his market calls?

Larry’s life’s work over four decades was the study of cycles. He quantified and cataloged historical cycles stretching back hundreds and even thousands of years. He combined this with cyclical pattern recognition across hundreds of markets and individual securities.

Plus, he added his own unique methods of technical analysis, to produce one of the most effective trading tools any investor could hope for: His Artificial Intelligence Neural Net model with the power to indicate expected cycle highs and lows in stocks, bonds, commodities, currencies and more.

Larry devoted these last three years pouring himself and his vast investing experience into this model. And as my mentor of 15 years, he entrusted me and his team of analysts and traders here at Weiss Research with his most closely guarded secrets and strategies for reliably detecting key market turning points.



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Wealth Building Strategies

Is recent Stock Market Rally Real or a Blow-off Top?​​​​​​


Posted by Chris Vermeulen & John Winston: Modest Money

on Wednesday, 15 March 2017 07:24

Is-Recent-Stock-Market-Rally-Real-or-a-Blow-off-Top

The U.S. stock market remains in a full-blown bull market with President Trump re-energizing the base.  The U.S. stock market has temporarily become overbought and is likely due for a pause before the next new impulse wave up resumes.

My research indicates…

This Bull Market is not over. After this, it will move much higher!

spxtmtf

Courtesy of  TMTF service

The chart, displayed below, is an overbought/oversold indicator which when it pushes above +100 or below -100, respectively, the indicator will hit its’ extreme point.  The market then respond to it which indicates a change in the market’s trend.



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Stocks & Equities

A Whole Lot Of Pain Is Coming


Posted by Bill Fleckenstein via King World News

on Wednesday, 15 March 2017 07:07

King-World-News-Legend-Warns-Were-Entering-The-Most-Dangerous-Phase-Of-The-Worst-Crisis-In-World-History-864x400 c"Today’s headline refers to the fact that, really for the first time since the Trump rally began, it actually feels like the market may have achieved exhaustion."

"I would at least bring up the point because if I’m right we will see some weakness, followed by a failing rally, followed by a whole lot of pain…"

'Let’s Get Straight To the Points"

....read the entire article HERE

...also from King World:

James Turk – What Is Happening In The Gold & Silver Markets Right Now Is Extremely Rare



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