Monday, August 22, 2016
gold miner commentary, and market boredom generally
Still don't think I can post my own gifs, so I'll have to steal a chart from Jojo:
And today GDX has dropped to its SMA(50).
The question is whether it rebounds from there, or doesn't. And probably most of the people who bought GDX over the past few months are concerned about that, and they weren't concerned about that while the miners were on a tear, so it's an introduction of a new downside concern; and so the market's psychology has set up a situation where any break through SMA(50) means a possible panic-puke down to something much lower.
And today's silver breakdown below its SMA(50) definitely skews probabilities in favour of that panic-puke in the miners, since you'd think miners' momentum should be led somewhat by silver.
And the US dollar has spent all month going down, yet PMs haven't advanced, and that should also suggest to market participants that their pie-in-the-sky gold story isn't a sure bet after all, which is yet more reason to puke. Gold's not supposed to move in tandem with USD, that totally throws off the Bloomberg Headline Autogenerator.
Of course if the puke doesn't happen, then that's bullish for miners. It's just that if they do puke unreasonably, that's a better point to get back into the market.
Frankly the whole broad market has been boring the shit out of me for over a week now, so I guess we won't see any new moves in any direction til September.
I was originally going to identify the September Fed meeting (and likely rate hike) as the inflection point, but that's too far away. Can we maybe see some sort of geopolitical concern crop up before then? Well, even in that case it won't happen til September because nobody's in the office to puke stocks right now.