Mark

The Gold Update: No. 799 – (08 March 2025) – “Gold Goes Inside; Stocks Maintain Slide”

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The Gold Update by Mark Mead Baillie — 799th Edition — Monte-Carlo — 08 March 2025 (published each Saturday) — www.deMeadville.com

“Gold Goes Inside; Stocks Maintain Slide“

Whilst we’ve still our near-term negative bent for the price of Gold, nonetheless let’s reprise this from last week’s missive:  “…one thing to watch is a stirring of geo-political jitters which as you regular readers know can quickly send Gold higher — but generally just briefly — before returning down from whence it came…”

And from the prior Friday’s White House brawl to yesterday morning’s RUS/UKR missile-drone attack, such geo-political jitters — in tandem with tariff tantrums — have kept Gold aloft, price settling the week at 2918 for a net five-day gain of +1.8% (+50 points).

Yet, ’twas a so-called “inside week” for the yellow metal, meaning Gold printed both a higher-low but lower-high than in the week prior.  ‘Tis depicted below in the left hand panel wherein the outermost green and red horizontal lines are the prior week’s range and the innermost two this past week’s range, the diagonal slants showing the difference.  Still, in spite of it all, Gold’s “Baby Blues” of trend consistency continued to fall, paired here with the S&P’s folderol and Silver’s getting a grip on it all:

“But mmb, that’s more than just S&P folderol ’cause it’s down -6% from its high!”

We’ve on occasion been queried if Squire is paid for such “teeing-up” comments.  (Rather, for the privilege of his presence on this page, he pays us).

But to the point, yes, the S&P 500 (now 5770) has lost -6% of its value from the all-time high (6147) of just 13 trading days ago (19 February).  Yet from our purview ’tis “nuthin’ but noise” given the mighty Index today is +765% above its FinCrisis low of 667 (06 March 2009) as well as +163% over the COVID low of 2192 (23 March 2020).  Thus for you WestPalmBeachers down there, the S&P’s -6% pullback is a statistical irrelevancy.  And as our regular readers know all too well, relevancy shall have returned upon the S&P’s price/earnings ratio (the “live” reading now 41.0x) having reverted to its reasonable mean in the low 20s, (which always has occurred — either up or down — since the S&P 500’s inception 68 years ago in March 1957) And in turn, the otherwise ongoing Investing Age of Stoopid shall have been eradicated.  (Nevertheless, we’ve more on the FinMedia “Panic!” toward today’s wrap).

As to Gold’s ten trading weeks year-to-date, this past one (the rightmost green bar) is the first to be characterized as “inside”.  Again, the inference as Gold continues to work off its extreme overbought condition is price having benefitted from geo-political and tariff trepidation; hence this past week’s buoyancy:

To be sure, Gold’s blue-dotted weekly parabolic remains safely Long.  However, by our BEGOS Markets Values measure (in placing a near-term value on Gold per its movements relative to those of the four other primary BEGOS components, i.e. the Bond, Euro, Oil and S&P 500), price is still some +70 points “high” above its smooth grey valuation line; and of course, the two inevitibly shall eventually meet.  Here they are from three months ago-to-date:

And again as you well know, we fully expect Golden Goal Two of “milestone” 3000 to trade this year, and further our forecast high for Golden Goal Three of 3262.  Yet as the “Not in a Straight Line Dept.” reminds us, we see the route thereto traveling through the 2703-2641 zone, just in case you’re scoring at home.

‘Course, how lovely ‘twould be to be wrong and instead see Gold proceed from here at 2918 right up the road to the opening Scoreboard’s Dollar debasement value of 3798.  Highly unlikely anytime soon, although in responding at a gathering this past week to the query “Is Gold now going to 10,000?” we said “No, and likely somewhat lower near-term, yet 4,000 perhaps is possible in two years or so…”

But obviously the bogeyman in the room is inflation — which most broadly is a Gold positive — but intermediately a threat to price should the Federal Open Market Committee resort to raising rates.  The good news there, however, is both retail and wholesale inflation by consensii are expected to have somewhat slowed their February paces from those for January.  Next Wednesday (the Consumer Price Index) and Thursday (the Producer Price Index) shall tell the tale.

Indeed let’s segue to the Economic Barometer which took a bit of a boffing during the week.  Of the 15 incoming metrics, only five improved period-over-period.  Most impressive were January’s Factory Orders which increased from December, that month’s decrease being favourably revised, and which beat consensus.  But the stinker was the backup in January’s Wholesale Inventories, which accumulated over those for December, that month’s depletion revised to a slower pace, and were a bit more bloated than consensus.  Too came the not so rare dichotomy of February’s Payrolls taking a rather severe hit per ADP, but by the Bureau of Labor Statistics actually increased.  “What’s your source?”  Here’s the Baro:

 

Meanwhile, let’s assess the state of the 10-day Market Profiles for both Gold on the left and Silver on the right.  Notably for the yellow metal, price spent much of yesterday’s week-ending session clustered ’round the now volume-dominant 2927 level.  As for the white metal, she settled the week smack on her volume-heavy 32.90 support/resistance bar:

More broadly with respect to Gold’s 300-day moving average across the last 14 years, price generally pulls back when ’tis +20% or higher above that measure (the blue line in the graphic).  Just prior to the start of the current near-term price correction (which began from the All-Time High of 2974 on 24 February), Gold had settled as high as +22.2% above said average; at present ’tis still a lofty +18.4% above same.  So again, we ought not be surprised should Gold further subside:

Toward closing, in light of the S&P 500 (which year-to-date is now down -1.9%, “OMG!”) having just recorded its weakest week (-3.1%) of the ten thus far this year, as we earlier teased, let’s check in with a few of Friday’s “FinMedia Freakout” finales:

Bloomy:  “Wall Street’s Big Selloff Puts Pressure on America’s Rich Households”  Lovin’ this one, for how many times have we written:  “Marked-to-market everyone’s a millionaire; marked-to-reality nobody’s worth squat”;

DJNw:  “Most Americans can’t afford life anymore…”  So is DJNw’s assumption here the alternative?  That’s a bummer.

CNBS:  “The oversold stocks due for a technical bounce after a brutal week.”  Truly ’tis dumbing down of the word “brutal”; we’ve haven’t had “brutal” since March 2020; and from 2008 into 2009, we regularly ate “brutal” for breakfast.  So what leads to “brutal”?  The aforenoted “live” S&P P/E of 41.0x

“So then is the S&P about to crash, mmb?”

Obviously no one knows, Squire.  What will eventuate over time is the reversion of the S&P’s P/E to a level of normalcy, as earlier cited in the low 20s via:  1) a doubling in earnings without the stock market rising, or 2) a 40%-50% stock market “correction”, or 3) a“Combination of the Two” –[Big Brother and the Holding Company, ’68]

Either way, we wrap with a wry note:  per this penning, there remain two full weeks of Winter.  Yet for some reason of absurdity, StateSide folks early tomorrow move their clocks to summer hours.  What that means for The Gold Update is — by adhering to its time-honoured traditional uploading each Saturday at 11:00 PacCoastTime — ’twill be an hour earlier here EuroSide at 19:00 for our next three editions (15, 22 and 29 March) until we then nudge our clocks forward come 30 March.

And specific to next week’s piece, “Beware the Ides of March”, for it brings our 800th consecutive Saturday edition of The Gold Update…

07 March 2025 – 08:40 Central Euro Time

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StateSide ’tis February’s Payrolls day for the Econ Baro (and late in the session January’s Consumer Credit). At present we’ve the Bond, Euro, Swiss Franc and Oil all above their respective Neutral Zones for today; volatility for the BEGOS Markets is light. The S&P 500 remains “textbook oversold” such that a so-called “dead cat bounce” may be warranted; however the Index’s broader technical picture is facing a negative crossover on the monthly MACD that seemingly can confirm into April; given the unsustainably high “live” P/E of 40.4x, the S&P ought deservingly suffer rough sledding at least over the near-to-medium term, especially with the short-term U.S. Treasuries yielding better than triple that of the S&P (4.197% vs. 1.343%). ‘Tis to worthy to note that from the S&P’s March 2009 low, the Index has increased by as much as 822%: thus this 7% pullback is essentially noise; indeed were it not for COVID and the monetary creation thereto, the S&P today (5739) would instead be ’round 3000.

06 March 2025 – 08:44 Central Euro Time

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Presently we’ve the Bond below its Neutral Zone for today, whilst Oil is above same; the BEGOS Markets’ volatility for this time has calmed to mostly light. Amongst the five primary BEGOS components, we’ve now a positive correlation between the Euro and Gold, which makes sense give the Dollar’s demise notably this week. Copper’s +4.9% net gain yesterday was the largest since 04 November 2022: at Market Trends, Copper’s rally was sufficient to stall the otherwise falling “Baby Blues” of trend consistency. Meanwhile, that measure for the Spoo continues to drop, albeit the S&P 500 itself is now seven days “textbook oversold”; still, the “live” P/E of the S&P (futs-adj’d) is a horribly high 43.1x. Today’s incoming metrics for the Econ Baro include January’s Trade Deficit and Wholesale Inventories, plus the revisions to Q4’s Productivity and Unit Labor Costs.

05 March 2025 – 08:38 Central Euro Time

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The Euro, Silver and Copper are all at present above today’s Neutral Zones; the other five BEGOS Markets are within same, and session volatility is moderate-to-robust, Copper notably having traced 170% of its EDTR (see Market Ranges). As has oft been the case of late, we’ve no notable correlations amongst the five primary BEGOS components. In looking at Market Rhythms for pure swing consistency, our 10-test basis cites the Swiss Franc’s 1hr Parabolics as best, whilst on a 24-test basis we show both the non-BEGOS Yen’s daily Parabolics and the Euro’s daily MACD. The Dollar Index has thus far traded today down to its lowest level (105.280) since 11 November, Gold getting a bit of a bid in the balance, albeit to the extent ’tis geo-politically driven, we look for Gold to resume working lower (as detailed in the current edition of The Gold Update). The Econ Baro awaits February’s ADP Employment data and ISM(Svc) Index, plus January’s Factory Orders. Then late in the session brings the Fed’s Tan Tome.

04 March 2025 – 08:41 Central Euro Time

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Both the Bond and Swiss Franc are at present above today’s Neutral Zones, whilst below same are Copper and Oil; session volatility for the BEGOS Market’s is moderate, (which you may be noting is the case ’round this time more frequently of late). Yesterday’s whirl back down in the S&P 500 ought not be too much of an eyeopener given the Spoo’s 21-day linreg trend having last week rotated from positive to negative, as presently is the stance as well for both Silver and of course Oil over recent weeks; by Market Trends, those for the other five BEGOS components are positive; however Gold’s “Baby Blues” of trend consistency are in freefall as are those for Copper. Too for the S&P per our Moneyflow page, all three time bases (weekly, monthly, quarterly) point to still lower levels ahead for the Index. Nothing is due today for the Econ Baro with then 13 incoming metrics remaining from tomorrow through the week’s balance.

03 March 2025 – 08:29 Central Euro Time

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At present the Bond is below its Neutral Zone for today, whilst above same is the Euro; the BEGOS Markets’ volatility is mostly moderate. The Gold Update cites the anticipated fall having commenced for the yellow metal; as written: “…should the present selling become more substantive … ‘twould be reasonable to find price reach down into the 2703-2641 zone…” By Market Values, Gold — after having been better than +200 points “high” above its some valuation line — is now +56 points “high”. Notably too by that same metric, the Bond remains nearly +4 points “high”, the Euro basically in line, Oil -4.55 points “low” and the Spoo -104 points “low”. Despite the S&P 500’s +1.6% Friday rally, the Index is actually mildly “textbook oversold”; more meaningfully however, the overall weak level of earnings doesn’t support the “live” P/E of 44.0x. Q4 Earnings Season is complete with 69% of the S&P’s constituents bettering their bottom lines from Q4 a year ago, an above-average showing over 66% for the past eight years. The Econ Baro begins its week of 15 incoming metrics with February’s ISM(Mfg) Index and January’s Construction Spending.

The Gold Update: No. 798 – (01 March 2025) – “Thank Goodness Gold Finally Falls”

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The Gold Update by Mark Mead Baillie — 798th Edition — Monte-Carlo — 01 March 2025 (published each Saturday) — www.deMeadville.com

“Thank Goodness Gold Finally Falls“

Not that we’ve been rooting for Gold to fall, but it being one of the world’s most substantive liquid markets, it implicitly both rises and falls in its interactive role — that reflecting the cost of currency debasement — as one of the five most important financial stores of value along with the Bond (the cost of money), the Euro (or major currency of your choice as the cost of foreign flows), Oil (the cost of the global economic engine) and the S&P 500 (or major market index of your choice as the cost of equity risk).  We of course refer to this high-level grouping as BEGOS:  (Bond / Euro / Gold / Oil / S&P 500).

And from one trading day to the next, each of these five markets at the macro level basically receive and distribute money from one another.  In turn, their combined changes in price elicit a valuation for each component as updated daily on the website’s Market Values page.  And if you’ve been paying attention, Gold across the past few weeks was getting wildly up beyond valuation, our having emphatically pointed to such state in the prior two missives.  But now finally facilitated is Gold’s requisite fall, healthy in spite of it all:

‘Course contra to our wary stance — courtesy of the FinMedia —  emerged the “Suddenly Everybody’s a Gold Expert Dept.” proclaiming the price of 3000 being imminent.  And thus it did not happen, oft normal in such market-amateur hysterias.

Rightly instead, Gold as anticipated whirled ’round down to record its third worst week in better than a year, this time dropping -2.8% (-82 points) in settling yesterday at 2867.  Or to put it to music, we cue the Swiss rock band Gotthard from their ’07 song “The Call”: “The higher they fly, the harder they fall…”

“And, mmb, that really applies now to the stock market, eh?”

Frighteningly so, Squire.  Indeed to quote George Kennedy in “The Eiger Sanction”  (Universal, ’75):  “They won’t even know it’s coming until it hits.”  Or as a valued charter reader of The Gold Update has on occasion queried:  “Does it really matter which snowflake causes the avalanche?”

Then this past Thursday (per our daily Prescient Commentary) came Gold’s “Baby Blues” of trend consistency at long last breaking down below their +80% axis (as we’ll later see), which is key in having generated this signal in the end-of-day work spree:

“The obvious question then is, mmb?”

Squire, “How low is low?”  Thus here we go:  should the present selling become more substantive from the current 2867 level, ‘twould be reasonable to find price reach down into the 2703-2641 zone.  To be sure:  we still expect Golden Goal Two of “milestone” 3000 to eventually trade, directly or indirectly en route to Golden Goal Three of 3262 as our forecast high for this year.  But as we’ve herein reminded since New Year (Gold then 2639), the road to 3262 can quite fairly pass through the lower 2500s.  Is that to where this down run is heading?  Nobody knows.  But ’tis better to get the year’s low place before the high.

And as we been emphasizing, a wayward wrench dropped into the Gold works is inflation.  Recall our title from two missives ago included the phrase “Fed’s Next Hike”.  Apparently “hike” is not an allowable utterance at large.  Rather, press musings oscillate between “cut” and “pause”, with a lean of late toward the latter.  This results from their not implementing math.  Most notably came yesterday’s “Fed-favoured” inflation report for January’s Personal Consumption Expenditures.  The headline number — rather than easing — remained steady at +0.3% whilst the core number’s pace increased from +0.2% to +0.3%.  Here thus is our inflation summary for January:

No, thy eyes do not thee deceive.  Across the six measures, January’s average annualized inflation pace was +4.4%, more than double the +2.0% ultimately desired by the Federal Open Market Committee, nearly double December’s +2.6% rate, and the most since February a year ago.  But absent the use of mathematics, the once mighty Barron’s (which in recent years we’ve designated as a “children’s pool”) ran yesterday with “Inflation Eased…”  Seriously.  No wonder “The Dow” (that Index at which our parents used to look) gained +601 points.

So with the inflation scare in the air, Gold duly dropped as it needed to so do anyway, price as below shown arriving smack on the ascending regression trendline from one year ago-to-date per the weekly bars.  Note the parabolic’s flip to Short price is now 2683, which is quite centered in our aforementioned “how low is low” 2703-2641 zone.  Too, the Gold/Silver ratio is back above 90x, the white metal retreating more swiftly than the yellow metal:

Lower Gold to be sure, but ’tis not to be distressed.  For with two months of 2025 now in the books, we go to our BEGOS Markets Standings year-to-date to again find the Metals Triumvirate leading the whole pack, Copper now atop the stack +13.4% as the red, yellow and white metals dominate the podium:

And with further specificity to the precious metals, here we’ve the year ago-to-date percentage tracks of Gold along with key of its equities kin, therein finding Agnico Eagle Mines (AEM) having doubled at +100%, followed closely by Pan American Silver (PAAS) +91%, and then the VanEck Vectors Gold Miners exchange-traded fund (GDX) +53%, the Global X Silver Miners exchange-traded fund (SIL) +51%,  Newmont (NEM) +43%, Gold itself +40%, the bunch rounding out with Franco-Nevada (FNV) +36%.  ‘Tis about as good as it gets, even as near-term price decline has set in:

Hardly in decline since Halloween is the Economic Barometer, instead sporting on balance the mildest of rises.  ‘Course as we’ve pointed out across some 27 years of maintaining the Baro, increasing inflation works as a positive influence as it raises the nominal values of many-a-metric.  Either way for this past week’s 11 incoming metrics, five bettered their prior period, five were worse, and steady was the first revision to Q4’s Gross Domestic Product at an annualized  +2.3% pace:

As for yesterday’s S&P 500 big post-White House brawl rally, we eye it as a “dead cat bounce” given the significant deterioration of late in the Index’s Moneyflow regressed into S&P points.  By the website’s S&P Moneyflow page, the Index per this leading indicator “ought be” some 180-to-230 points lower than currently ’tis (5955).  Still, a tip of the cap to just concluded Q4 Earnings Season:  therein, 454 S&P 500 constituents reported, 69% of them bettering their bottom lines from a year ago, which across the past 31 reporting quarters has averaged 66%.  But as we point out ad nauseam, the overall level of earnings remains terribly weak given the price of the Index, the “live” price/earnings ratio of the S&P now 43.3x.  So stay suspect when it comes to stocks.

Not suspect a wit (per the “SELL” in the table earlier displayed) is the inevitable cascade in Gold’s “Baby Blues”, the red-encircled dot below confirming such signal.  So as is our month-end wont, here we go ’round the horn for all eight BEGOS components across the past 21 trading days (one month).  And you know the jingle: “Follow the blues, instead of the news, else lose yer shoes”:

Next we’ve the 10-day Market Profiles for Gold on the left and for Silver on the right.  Clearly at 2867, Gold is better than -100 points below its recent All-Time High (2974 this past Monday), whilst Silver has traveled from the 34s back to the 31s.  Notable volume-dominant prices are as labeled:

And with February now in the books, ’tis once again Gold Structure time by the month across some 16 calendar years.  Take note of “The Infamous Triple-Top” whereby each candle closed well below its respective month’s high, price then declining over the ensuing months:  our rightmost candle now for February has the same characteristic.  The good news “as ever” is Gold by currency debasement remains very cheap indeed.  Nonetheless, here’s the graphic:

So thus far for 2025 we’ve two months down (both net-net up for Gold) and ten to go.  As noted, in the year’s balance remain Golden Goal Two of “milestone” 3000 and our projected Golden Goal Three of 3262 for the high.  Yet ahead of such ascent we’ve this current descent, for which as stated we are thankful given major markets are not unidirectional.  However, one thing to watch is a stirring of geo-political jitters which as you regular readers know can quickly send Gold higher — but generally just briefly — before returning down from whence it came.  Either way, in the words of The Gold Update’s first ever reader away back in 2009 (JGS):  “We’ll watch it together.”

So be a cool cat and stay with your Gold!

28 February 2025 – 08:42 Central Euro Time

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Gold’s “Baby Blues” (see Market Trends) confirmed falling below their key +80% axis, indicative of still lower prices; more tomorrow in the 798th consecutive Saturday edition of The Gold Update. Along with the yellow metal at present, Copper, Oil and the Swiss Franc are all below today’s Neutral Zones; above same is the Bond, and BEGOS Markets’ volatility is firmly moderate. The Moneyflow of the S&P 500 continues to be weaker than the down move in the Index itself: yesterday’s change in the S&P was -1.6%, however the Money suggested a change of -3.1%: as this is a leading indicator, we look for further selling in the S&P; mind our S&P Moneyflow page. ‘Tis the final day of Q4 Earnings Season. And the Econ Baro wraps its week, indeed the month, with February’s Chi PMI plus January’s Personal Income/Spending and “Fed-favoured” Core PCE.

27 February 2025 – 08:45 Central Euro Time

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Both the Swiss Franc and Gold are below today’s Neutral Zones; the other six BEGOS Markets are within same, and volatility is again moderate, although like yesterday ’round this time, Oil has traced but 18% of its EDTR (see Market Ranges). At Market Trends, Gold’s “Baby Blues” of trend consistency are provisionally (in real-time) dropping below their key +80% axis, indicative (upon confirmation) of lower prices near-term: recent missives of The Gold Update have been anticipative of a run down; looking at Market Values in real-time, Gold is +107 points “high” above its smooth valuation line. By that metric for the other four primary BEGOS components: the Bond shows as nearly +4 points “high”, the Euro as essentially in line, Oil as -6.25 points “low” and the Spoo now as -76 points “low”. The week’s selling in the S&P 500 has actually pushed it down into “textbook oversold” territory, however the Index remains dangerously high by its “live” (futs-adj’d) P/E of 44.6x. Included in today’s incoming metrics for the Econ Baro are January’s Durable Orders and Pending Home Sales, plus the first revision to Q4 GDP.

26 February 2025 – 08:40 Central Euro Time

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The Bond and the EuroCurrencies are at present below their respective Neutral Zones for today; the balance of the BEGOS Markets are within same, and volatility is moderate, save for Oil which has traced just 15% of its EDTR (see Market Ranges). For the S&P 500, similar to that from Monday, on Tuesday whilst the Index fell -0.5%, the Moneyflow was instead suggestive of a -1.6% fall, again indicative of further selling still to come (see our S&P Moneyflow page). The Spoo’s 21-day linreg trend confirmed rotating to negative, the “Baby Blues” of trend consistency now having moved below their 0% axis (see Market Trends); should the selling turn more substantive, we’d look in due course for the S&P 5400s. The Bond’s cac volume is rolling from March into June, whilst that for Silver from March into May. And the Econ Baro awaits January’s New Home Sales.

25 February 2025 – 08:35 Central Euro Time

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The Bond is above its Neutral Zone for today, whilst below same are Gold and Copper; session volatility for the BEGOS Markets is light. As anticipated, in real-time the Spoo’s 21-day linreg trend line has rotated to negative (see Market Trends) as has been that for Oil for the past few weeks; such trend for the other six BEGOS components is positive, albeit with weakening “Baby Blues” (which depict trend consistency) in decline for the Bond and all three elements of the Metals Triumvirate. The MoneyFlow of the S&P 500 was notably more negative yesterday (-1.2%) than that of the Index itself (-0.5%), suggestive of lower price levels near-term. The Econ Baro looks to February’s Consumer Confidence.

24 February 2025 – 08:41 Central Euro Time

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Into the new week we’ve presently both the Euro and Spoo above today’s Neutral Zones; none of the other BEGOS Markets are below same, and volatility is mostly moderate. The Gold Update (as was the case a week ago) gives a near-term bearish bias strictly by technicals and the deMeadville proprietary measures (see Gold under BEGOS Markets): an affective metric this week shall be Friday’s release of PCE inflation data; either way, Gold completed an eighth consecutive up week for just the fifth time (mutually-exclusive basis) this century and currently priced at 2954 is -46 points below “Golden Goal Two” of “milestone 3000”. Nothing is due today for the Econ Baro. And, barring laggards, this is the final week of Q4 Earnings Season: with 402 S&P 500 constituents thus far having reported, 69% have improved their bottom lines from Q4 of 2023, a somewhat better-than-average improvement pace; problematic remains the extreme 45.2x P/E ratio.

The Gold Update: No. 797 – (22 February 2025) – “Gold Higher Every Week Year-to-Date”

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The Gold Update by Mark Mead Baillie — 797th Edition — Monte-Carlo — 22 February 2025 (published each Saturday) — www.deMeadville.com

“Gold Higher Every Week Year-to-Date“

Let’s commence with another infamous Gold Update quiz!  Ready?

Since at least this very day a month ago (22 January), what technically until yesterday (21 February) have both Gold and the S&P 500 had in common?

“They’ve been overbought day-after-day, right mmb?”

Spot-on there, Squire.  Per near-term widely-used “textbook technicals”, (in our case the potent cocktail of John Bollinger’s Bands, plus Relative Strength and a generous dash of Stochastics), we’ve Gold now “overbought” through the past 29 trading sessions (since 08 January), as had been the case for the S&P 500 through 21 trading sessions (since 22 January) until finally yesterday it began to all go wrong.

But of greater import than technical excess, fundamentally both Gold and the S&P instead remain 180° out of phase.  As we regularly remind, whilst the major markets are never wrong, they can be terrifically misvalued.  And ’tis quite stark for this pair:

  • Gold, in settling the week yesterday (Friday) at 2950, is still well shy of the opening Scoreboard’s Dollar debasement valuation level of 3843; in other words, Gold is trading at a -23% discount to its true value.

  • The S&P 500, in settling its week at 6013, remains maniacally expensive, the honestly-calculated price/earnings ratio now 45.7x versus the 25.4x reading a dozen years ago; in other words, the S&P 500 is trading at a +80% premium to such normalized value.

Or if you prefer, the S&P is today at a +154% premium vis-à-vis Jerome B. Cohen’s “in bull markets the average [p/e] level would be about 15 to 18 times earnings”.  But we digress…

The point specific to Gold is:  to be sure, ’tis still today a magnificent value, even in having achieved yet another marginal All-Time High this past Thursday at 2973.  In fact, through these first eight trading weeks of 2025, all have been up for Gold, price itself year-to-date now +12%.  Moreover — in the pure vacuum of linear regression — Gold is on pace to finish this year +93% at 5093(!)  ‘Course, such level would be ridiculously overvalued above Dollar debasement, and again (as we did pen back in 2011) Gold shall “have gotten ahead of itself”.  No, this year ’tis not going to happen.

But in context with our missive’s title, Gold has reached rarified air in terms of consecutive up weeks.  Its last down week was that ending last year.  And now for just the fifth mutually-exclusive (which for you WestPalmBeachers down there means non-overlapping) instance — for the 1,260 weeks thus far this century — Gold has recorded eight or more consecutive up weeks.  Here’s the summary, the current up streak emboldened therein:

Indeed per our prior piece, we’d a bit of a bias toward last week being down.  Not so much given Gold’s “textbook overbought” state, but rather by our proprietary, reliable measure of price versus its smooth valuation line, which as you regular readers knows gauges Gold’s movement relative to those of the primary BEGOS Markets (Bond / Euro / Gold / Oil / S&P 500).  Here’s the updated graphic from a year ago-to-date, the red encirclements indicative of price essentially being +200 points “high” above the smooth line.  Note when this last occurred in April a year ago, price swiftly sank from 2400 to 2300, then to remain stalled in that range until July:

“But the news says everybody’s buying, mmb…”

We love Squire’s tee-up comments, and the FinMedia certainly is taking a rare above-average notice of Gold.  ‘Course — courtesy of the “It Takes Two to Tango Dept.” — if “everybody’s buying” then too “everybody’s selling”; ’tis just that more offers are being hit than bids, price thus rising.  And as stated, such has been the case through this year’s first eight weeks as we go to Gold’s weekly bars from a year ago-to-date, the rightmost eight closing nubs ascending in green:

Too, never has the phrase “Gold 3000!” been so bandied about by “everybody”.  You’ll recall from last week’s wrap our referring to the late Art Cashin (best last name ever for a stock market maven) having quipped that should a stock reach up to the price of 90, then 100 shall trade.  And thus Gold having already had 2900 trade would correspondingly see 3000, (which obviously it ultimately shall).  For as you know,  we’ve Golden Goal Two of “milestone” 3000, and then by year-end, Golden Goal Three of 3262 as our forecast high.

But having been in this business across many-a-decade, one learns that when something “Well obviously!” is imminent to happen … it oft doesn’t.  As we’ve clearly set forth, the price of Gold near-term is significantly stretched to the upside such that a series of pullback weeks may well now be in order.  Too, as mentioned back at New Year in forecasting 3262 for this year’s high, we specifically stated that the road to that level can reasonably pass through the lower 2500s.  And what an additional buying opportunity that would be.  As is regularly said in this business, we’ll see…

In seeing to the StateSide economy, the Conference Board issued January’s “Leading Indicators” as having had an on-balance decline of -0.3%, whereas as next depicted in the Economic Barometer, that month’s metrics have instead sported a bit of an up bend.  The difference lies in the Conference Board’s assemblage of 10 key monthly indicators versus our aggregation of some 50 metrics.  To the Board’s credit, they regularly make prior month revisions such that come February’s report (20 March) we may see January’s result bumped back up a pip or two: 

Either way, February metrics from last week showed quite notable month-over-month declines in the National Association of Home Builders Index, the Philadelphia Fed Index, and in the revision to the University of Michigan’s “Go Blue!” Sentiment Survey.  And the ensuing week brings the “Fed-favoured” inflation gauge for January of Personal Consumption Expenditures.

But stranger still:  the stock market actually went down on the poor news!  This hasn’t materially happened (without looking it all up) since the March 2020 onset of COVID.  Indeed the new paradigm since then has strictly been “Earnings and economic data are irrelevant because bad news means the Fed has to cut rates!”  Or has that strategy of buying stocks on negative news just stopped working?

With the aforementioned S&P 500 p/e ratio now 45.7x, are earnings soon to matter again?  With the annualized dividend yield on the S&P now 1.253%, is investing $100,000 in the mighty Index worth the $1,253 return in addition to it being hoovered away and then some should stocks suffer?  After all, for the 45 years from 1980 through 2024, the S&P has actually posted years that were down, (’tis said younger traders don’t understand that), in fact on average once every four years … but there’s been only one down year in the past six!  Oh no, say it ain’t so!

And yet, $100,000 invested in the U.S. One-Year Treasury Bill now shall return $4,168:  that’s more than triple the S&P’s yield and you get your money back!  What a concept, eh?  Is this at long last the beginning of the end of the Investing Age of Stoopid?  Either way, as to the media’s perfect scapegoat upon whom to lay blame … think about it.  Once again, on verra…

Too scary, let alone risky, is the stock market.  So let’s get back to Gold …  Good ol’ Gold!

And turning to our two-panel Gold graphic of the daily bars from three months ago-to-date on the left and 10-day Market Profile on the right, never in our immediate memory have we ever seen such a pasting on the ceiling for the baby blue dots of trend consistency.  Year-to-date, price has been as close to “straight up” as is conceivable.  ‘Course, Gold being a major liquid market, such trend shan’t last; but ’tis been the most amazing ride of late.  As for the Profile, note that volume-dominant support falls away below 2931:

Then there’s “poor ol’ Sister Silver”, albeit trading in the 33s, hardly is she “poor”.  But in her like graphic, she’s not been (at left) as robustly up as has been Gold, whilst per her Profile (at right) she’s jammed into the center of a trading range essentially spanning from 32.25 up to 33.40.  Yet priced to the century-to-date 68.8x average of the Gold/Silver ratio (the actual ratio currently 89.9x), Silver rather than at 32.83 today would instead be +31% higher at 42.90 … just in case you’re scoring at home:

Speaking of scoring, to wrap, the U.S. Treasury (as you’ve no doubt read) presently “scores” the United States Bullion Depository supply of Gold at $42/oz.  Therein said facility — just on the outskirts of Fort Knox, Kentucky — is “officially” (in round numbers) some 147,300,000 ounces of Gold according to “AI” (“Assembled Inaccuracy”), for an accounting value of $6,174,000,000.  That is how much the U.S. Federal Government spends about every 10 hours.  (Do the math if you must, starting with the annual spend of $6,740,000,000,000).  Makes ya feel kinda small, what?  However:  marked-to-market at $2950/oz. puts the value — were it all liquidated at that price — to a supply total of $433,650,000,000 which essentially would run the federal government for one month.  That’s it.

21 February 2025 – 08:35 Central Euro Time

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Copper is the sole BEGOS Market at present outside (below) its Neutral range for today; however, session volatility is pushing toward moderate. Gold indeed made another marginal All-Time High yesterday in reaching 2973 (from the prior 2968); as you well know, the yellow metal — whilst still significantly undervalued vis-à-vis Dollar debasement — is extremely near-term overbought: more in tomorrow’s 797th consecutive Saturday edition of The Gold Update. The Spoo’s EDTR (see Market Ranges) has been narrowing since a recent peak at 93 points on 07 January: through yesterday, ’tis now 64 points; again, we’re minding the Spoo’s 21-day linreg trend (see Market Trends) for its rotating from positive to negative. The Econ Baro wraps its week with metrics which include January’s Existing Home Sales.

20 February 2025 – 08:31 Central Euro Time

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The Swiss Franc, Gold and Silver are all at present above their respective Neutral Zones for today; none of the other BEGOS Markets are below same, and volatility is light, (save for the non-BEGOS Yen which has traced 103% of its EDTR, which for the BEGOS components can be seen at Market Ranges). Correlations amongst the five primary BEGOS components have been messy of late with no notably directional pairings therein. Gold appears poised to set another All-Time High (above 2968) as the day unfolds: the high thus far this session is 2967. The S&P 500 is entering its 21st consecutive trading day as “textbook overbought”; the Spoo’s “Baby Blues” look to slip into negative territory within the next few sessions as the linreg trend rotates to negative, (barring a firm rally). And amongst the metrics due for the Econ Baro are February’s Philly Fed Index and January’s Leading (i.e. “lagging” given the Baro) Indicators.

19 February 2025 – 08:33 Central Euro Time

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At present, only Oil is outside (above) today’s Neutral Zone; session volatility for the BEGOS Markets is quite light. Looking at Market Rhythms for pure swing consistency, on a 10-test basis the best currently are the Bond’s daily Moneyflow, Copper’s 30mn Price Oscillator as well as the red metal’s 2hr Parabolics; on a 24-test basis our leaders are (as oft has been the case) the non-BEGOS Yen’s daily Price Oscillator and daily Parabolics, plus the Euro’s 4hr MACD. The flow into Gold is being maintained, price (2950) in real-time +203 points above its smooth valuation line; today marks the 22nd consecutive trading session for Gold with its “Baby Blues” (see Market Trends) above their key +80%, a stretch which for any BEGOS Market is remarkable. The Econ Baro looks to January’s Housing Starts/Permits; and late in the session come the Minutes from the FOMC’s 28/29 meeting.

18 February 2025 – 08:48 Central Euro Time

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Into the session’s second day, as expected the BEGOS Markets have increased their range traveled: at present below their Neutral Zones are the Bond, Euro, Swiss Franc and Copper, whilst above same are Gold, Silver, Oil and the Spoo, with overall volatility firmly moderate, leaning toward robust as the day develops. Were the S&P 500 to open at this instant, ‘twould be at an all-time high of 6140 (vs. the actual-to-date of 6128). Going ’round the Market Values horn for the five primary BEGOS components (in real-time), we show both the Bond and Euro as nearly on their smooth valuation lines, Gold as +185 points “high” above same, Oil -4.35 points “low” and the Spoo as +94 points “high”. With Gold at 2925, the volume-dominant overhead Market Profile resistors are 2931 and 2944. The Econ Baro awaits February’s NY Empire State and NAHB Housing Indices.

17 February 2025 – 08:42 Central Euro Time

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The BEGOS Markets begin the week with a two-day session (for Tuesday settlement); at present, we’ve the Bond below today’s Neutral Zone, whilst above same is Gold; session volatility already is pushing toward moderate and likely by this time tomorrow shall be mostly robust. The Gold Update graphically depicts last week’s price spike to the new All-Time High of 2968; still, we are cautious of Gold’s near-term extensive stance, seven consecutive up weeks now recorded; price is “textbook overbought” for the last 25 trading days, and (in real-time) ’tis +171 points above it smooth valuation line (see Market Values). Too, the inflation scare has us once again musing of the Fed potentially having to revert to raising rates. To this point in Q4 Earnings Season, 361 S&P 500 constituents have reported, of which 70% have bettered their bottom lines from Q4 of 2024: again, that is an above-average rate of improvement, albeit the Index itself remains catastrophically high with the “live” (futs-adj’d) P/E at this instant 47.8x.

The Gold Update: No. 796 – (15 February 2025) – “Gold’s Price Spike; Fed’s Next Hike”

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The Gold Update by Mark Mead Baillie — 796th Edition — Monte-Carlo — 15 February 2025 (published each Saturday) — www.deMeadville.com

“Gold’s Price Spike; Fed’s Next Hike““

“This is where it starts to get fun.”

If said phrase ran across your mind during this past week, worry not: for it, too, ran through our mind.  And thus it having run through both your mind and our mind, then it also ran through the many minds of those financially math-inclined.  For there was more meat in this past week than one might have expected to digest (barring having imbibed in a settling digestive).

First, per our title, let’s assess “Gold’s Price Spike”. For en route to (barely) completing a seventh consecutive up week, Gold on Tuesday made a “Trump Tariffs!” spike up to as high as 2968, a mere 32 points from achieving the Golden Goal Two of “milestone” 3000.  For whilst much of the western world slept, Gold took off like a jet from Tuesday’s open at 2937 to 2968, a +31-point spike in just three hours.  ‘Course it being a price spike, ’twas swiftly short-lived and then some within the 30 minutes that followed.

Further, given fears of renewed inflation made manifest come Wednesday’s StateSide Consumer Price Index, Gold gave up the entirety of the week’s gain to that point on the metric’s staggering shock.  But, another “Global Trade War!” buying binge nonetheless ensued, only to be purged anew, Gold then settling yesterday (Friday) at 2894 for a bare gain of just +8 points for the week.  Here are those five days (10-14 February) by the hour:

And no, thy eyes do not thee deceive, for on the graphic ’tis queried “Fed Rate HIKE?”  Indeed, with respect to the balance of this week’s title, recall these statements from the past two editions of The Gold Update:

1)  01 February:  “…an inflation scare followed by a Federal Reserve rate hike, should they dare, something for which the financial world at large seems unaware…”

2)  08 February:  “…an inflationary scare could cause a Fed flare (again, should they dare), in turn substantiating a Gold price pare…“

Indeed a scare:  January’s headline CPI pace of +0.5% was well beyond experts’ consensus of +0.3%, as too was the core of +0.4%.

But wait there’s more:  The Producer Price Index then arrived Thursday — also above consensus — with headline and core respectively +0.4% and +0.3% … but did you see the revisions to December’s paces?  Headline PPI was recalculated from +0.2% to +0.5% and core from a flat 0.0% to +0.4% –> Across the 27 years of maintaining the Economic Barometer, ’tis but the third time headline PPI has been revised by +0.3% (and never greater) and the very first time core has been revised by as much as +0.4%.  Is this a result of too much holiday consumption of “egg nog” over there at the Bureau of Labor Statistics?  Such are the optics…  Again per our opening statement “This is where it starts to get fun.”

As to Gold’s rightmost price spike — indeed to another All-Time High of 2968 — here ’tis graphically portrayed by the weekly bars from one year ago-to-date, the blue-dotted parabolic Long trend now four weeks in duration:

Certainly still in play is our Golden Goal Two “milestone” level of 3000.  And yes, ’tis still quite reachable during the course of this current Long trend.  Yet that said, we see (at least one) down week ahead.  To be sure, Gold today at 2894 fundamentally remains -25% undervalued vis-à-vis the opening Gold Scoreboard’s Dollar debasement value of 3837.  But near-term Gold is technically overvalued as we again bring up our BEGOS Markets’ (Bond / Euro / Gold / Oil / S&P 500) metric for pricing Gold per its movement relative to those of the other four components.  And by the lower panel oscillator of price less value, Gold now reads as +160 points “high” above its smooth valuation line:

Moreover by standardized technical measures (our cocktail of Bollinger Bands, Relative Strength and Stochastics), we’ve Gold now “textbook overbought” through 25 consecutive trading sessions dating back to 10 January … just in case you’re scoring at home.  So whilst Goal Two for “milestone” 3000 remains well in the cards, (not to mention Goal Three of 3262 for this year’s forecast high), uni-directionality applies neither to Gold nor any major market, which for you WestPalmBeachers down there means Gold shan’t go straight up.

Still, making a bit of a turn up of late is the aforementioned Econ Baro.  As you long-time readers know, inflation — which just “suddenly” leapt back onto center stage — when rising is a Baro positive as nominal levels of various metrics increase in kind.  ‘Course as we’ve herein mentioned, ’tis stagflation that’s the worry.  Recall this from two missives ago with respect to the first peek at Q4’s Gross Domestic Product:  “…per the ‘Chain Deflator’, whereas inflation contributed to 38% of nominal Q3 GDP growth, for Q4 the inflation component increased to 49%.  Thus … slowing growth + increasing inflation = stagflation…“  And did you note the downswing in January’s Retail Sales by -0.9% versus +0.7% for December?

“But mmb, that’s just seasonal after holiday spending…”

Au contraire, mon Squire cher.  Through the past 27 years, only 12 (44%) of such December-January seasonal shifts have been negative.  A bit too much information perhaps, but conventional wisdom is oft oxymoronic.  Here’s the Baro:

Meanwhile, the stock market as measured by the S&P 500 (6115) is but a wee -0.2% below its intrad-day all-time high (6128 this past 24 January).  In turn, our honestly-calculated “live” price/earnings ratio is now 47.7x.  (Yes, we comprehensively understand that earnings have become completely irrelevant to pricing shares; otherwise, the S&P today would be just either side of 3000).

So instead, ’tis “Nuthin’ but Fed!”  And therein lies the confusion.  The StateSide President is insistent that the Fed further cut rates.  FedChair Powell sees the economy as too robust to warrant rate cuts.  And we see inflation as reasonably rampant to warrant rate hikes.  For not only has inflation not calmed down to the Fed’s preferred +2.0% annualized target, ’tis instead now moving further up and away from it.  Still, the “Fed favoured” inflation gauge (Personal Consumption Expenditures) for January doesn’t arrive for another two weeks (28 February). If that too has popped, words such as “hike” and “raise” shall start to be FinMedia propped.

Left without a prop on Friday were both Gold and Silver:  the yellow metal’s intra-day drop of -2.5% was the worst since 18 December, whilst that for Silver of a whopping -5.5% was its worst since 12 December.  Both cases are below shown by their rightmost bars for Gold on the left with Silver on the right.  ‘Tis been a fine move — especially for Gold — across the past three months-to-date, albeit Friday might be referred to as a “technical failure” rather than an imminent trip toward Goal Two (“milestone” 3000).  That stated, as technically overbought is our Gold, ’tis primarily at present being fundamentally driven from one headline to the next, (per our hourly chart earlier displayed).  And as ever, mind those “Baby Blues” of trend consistency(!): 

Too for the precious metals we’ve next their 10-day Market Profiles for Gold (below left) and for Silver (below right).  The yellow metal (currently 2894) may turn dicey sub-2888, whilst the white metal (currently 32.66) has just slipped under her 32.75 dominant volume support price:

So if you are thinking that we are thinking “down” is Gold’s watchword for this ensuing week, yes we agree, albeit as aforementioned, price of late is being headline-driven.  Still as we turn to the stack, Gold year-to-date is well in the black:

The Gold Stack
Gold’s Value per Dollar Debasement, (from our opening “Scoreboard”):  3837
Gold’s All-Time Intra-Day High:  2968 (11 February 2025)
2025’s High:  2968 (11 February)
10-Session directional range:  up to 2968 (from 2802) = +166 points or +5.9%
Gold’s All-Time Closing High:  2957 (13 February 2025)
Trading Resistance:  notable overhead Profile nodes 2931 and 2944
10-Session “volume-weighted” average price magnet:  2903
Gold Currently:  2894, (expected daily trading range [“EDTR”]:  34 points)
Trading Support:  most notably 2888, then 2875
2025’s Low:  2625 (06 January)
The Weekly Parabolic Price to flip Short:  2607
The 300-Day Moving Average:  2424 and rising
The 2000’s Triple-Top:  2089 (07 Aug ’20); 2079 (08 Mar’22); 2085 (04 May ’23)
The Gateway to 2000:  1900+
The Final Frontier:  1800-1900
The Northern Front:  1800-1750
On Maneuvers:  1750-1579
The Floor:  1579-1466
Le Sous-sol:  Sub-1466
The Support Shelf:  1454-1434
Base Camp:  1377
The 1360s Double-Top:  1369 in Apr ’18 preceded by 1362 in Sep ’17
Neverland:  The Whiny 1290s
The Box:  1280-1240

Next week brings just a moderate dose of data for the Econ Baro, notable of which come Thursday (20 February) is the Conference Board’s Leading Indicators for January.  Again for regular readers, you know our penchant for referring to such metric as “lagging” given the Baro has already told the tale.  Thus the consensus for a flat January — or maybe +0.1% at best — makes sense. 

Just ensure your Gold and Silver portfolio shares are many percent!

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

14 February 2025 – 08:25 Central Euro Time

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We’ve both Silver and Copper at present above today’s Neutral Zones; the balance of the BEGOS Markets are within same, and volatility is mostly light, save for Silver which already has traced 110% of its EDTR (see Market ranges). Barring January being an outlier, the pace of inflation is increasing away for the Fed’s +2.0% preference; more tomorrow in the 796th consecutive Saturday edition of The Gold Update; to that end, Gold thus far today has traded up to 2064, just 4 points shy of its 2068 All-Time High achieved this past Tuesday; as a caution, Gold in real-time is +226 points “high” above its smooth valuation line (see Market Values). Too in real-time, Oil’s “Baby Blues” have provisionally moved above their -80%; as previously noted, confirmation of that condition typical brings higher prices near-term. And ’tis a busy day to end the week for the Econ Baro, scheduled metrics being January’s Retail Sales, Ex/Im Prices and IndProd/CapUtil, plus December’s Business Inventories.

13 February 2025 – 08:25 Central Euro Time

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The Euro, Swiss Franc, Gold and Copper are all at present above today’s Neutral Zones; none of the other BEGOS Markets are below same, and volatility is mostly moderate. The Bond’s “Baby Blues” (see Market Trends) confirmed settling below their +80% axis: price already has moved lower into structural support of the 113s; were that to crack, a re-test of January’s lows in the 110s would be in order, especially should inflation be re-accelerating. By that same study, Oil’s “Baby Blues” are mildly curling back upward (-81% in real-time): a settle above -80% would suggest higher price levels; too, Oil’s cac volume is rolling from March into April. And the Econ Baro awaits January’s wholesale inflation data via January’s PPI.

12 February 2025 – 08:35 Central Euro Time

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At present, all eight BEGOS Markets are within their respective Neutral Zones for today, and session volatility is light with January’s retail inflation metrics in the balance. Going ’round the Market Rhythms horn for pure swing consistency, currently the leaders (on a 10-test basis) are the Bond’s daily Moneyflow, the Euro’s 30mn Parabolics, Copper’s 15mn Price Oscillator, and the non-BEGOS Yen’s daily Parabolics; too, (on a 24-test basis) is again the Yen’s daily Parabolics as well as its daily Price Oscillator, plus the Euro’s 4hr MACD. And at Market Trends, despite the Spoo’s being in a 21-day linreg uptrend, its “Baby Blues” of the trend consistency are dropping for the fourth consecutive session. As noted, the Econ Baro awaits January’s CPI, plus (purportedly) late in the session the Treasury’s Budget. And per Humphrey-Hawkins, FedChair Powell, having testified yesterday before The Senate, concludes today with The House.

11 February 2025 – 08:47 Central Euro Time

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Both Silver and Copper are at present below today’s Neutral Zones; the six other BEGOS Markets are within same, and session volatility is light-to-moderate. The S&P 500 is now “textbook overbought” through the past 14 consecutive trading days: there were significantly longer overbought stints during 2024, but ’tis something of which to be aware, especially given the “live” (futs-adj’d) P/E now at 48.8x and a yield of 1.243% less than a third of that for the 3mo US T-Bill of 4.228% annualized. At Market Trends we’re minding the Bond’s “Baby Blues” of trend consistency which are just starting to roll over to the downside with inflation data due both tomorrow and Thursday. And at Market Values the most extreme deviation is Gold’s being (in real-time) +216 points “high” above its smooth valuation line, pricing reaching another All-Time High earlier today at 2968. Again, ’tis a quiet session for the Econ Baro.

10 February 2025 – 08:34 Central Euro Time

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The week starts finding at present the Swiss Franc below today’s Neutral Zone, whilst above same are both Gold and Silver; BEGOS Markets’ volatility is moderate. The Gold Update muses the 3000 level as within reasonable distance by month’s end, however cautions that price has risen for six consecutive weeks (which historically is a bit of an outlier); still, the weekly parabolic trend is Long and we maintain our forecast high for this year at 3262; more immediately, Gold (in real-time) is +200 points “high” above its smooth valuation line (see Market Values); too, price is quite stretched above its 300-day moving average, (nearly +20%). Q4 Earnings Season continues to run at an above average pace for S&P 500 constituents bettering their bottom lines from Q4 a year ago: 71% of the 286 reports thus far have so done; ‘course it remains very problematic that the overall level of S&P 500 earnings is too low to support the extremely high Index itself, (the “live” futs-adj’d P/E at this instant 48.4x). ‘Tis a back-loaded week for the Econ Baro with 13 metrics due beginning on Wednesday.

The Gold Update: No. 795 – (08 February 2025) – “Gold Teases 2900; to 3000 Unencumbered?”

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The Gold Update by Mark Mead Baillie — 795th Edition — Monte-Carlo — 08 February 2025 (published each Saturday) — www.deMeadville.com

“Gold Teases 2900; to 3000 Unencumbered?“

The price of Gold just completed its sixth consecutive up week, within which the past three thus far comprise the newest weekly parabolic Long trend.  Indeed through this latest week, Gold continued to attain All-Time Highs, teasing yesterday (Friday) up through 2900 to 2910 before settling at 2886.

Moreover as you regular readers already know, our Golden Goal Two (of three) is the “milestone” level of 3000.  And given Gold’s expected weekly trading range is now 93 points, within that vacuum, 3000 (+114 points from here) is certainly “within range” by month’s end.  But are six consecutive up weeks already getting a bit long in the tooth for Gold?

Just in case you’re scoring at home, century-to-date there are now 1,258 trading weeks in the books.  And therein we’ve had 176 Gold up streaks of two or more weeks.  However, Gold’s having completed an up streak of at least six weeks (such as to now) has only happened 14 mutually-exclusive times, the record being 12 up weeks from 20 August 2007 through 09 November 2007 for a net price gain of +26%.  As stated, this new weekly parabolic is but three weeks young per the rightmost blue dots…

…and as comprehensively detailed in our 25 January missive “Gold Goes Long with Three Golden Goals”, the average duration of the prior 10 such Long trends (dating back to December 2020) was 12 weeks.  Further, the average price gain was +10.5% which as penned per our “Moderate assessment … would bring Gold 3069″.

‘Course, neither you, nor we, nor anybody “knows” when Gold 3000 shall trade.  But because we do the math, hardly would we bet against it ever happening, and reaching 3000 not only this year but on this current weekly parabolic Long trend — even as noted with this month — is quite reasonable.  And lest we forget more broadly, Golden Goal Three is our 3262 forecast high for this year, beyond which per the opening Gold Scoreboard, price by Dollar debasement already “ought be” 3833. 

Still, six consecutive up weeks for Gold and our being aware of an inflationary scare could cause a Fed flare (again, should they dare), in turn substantiating a Gold price pare.  For did you note yesterday’s +0.5% Hourly Earnings increase within January’s StateSide Non-Farm Payrolls?  That ties as the largest such increase for just the third time across the past 27 months.  And century-to-date, the average monthly increase is but +0.3%, itself annualized being +3.6% and thus above the Federal Reserve’s desired overall +2.0% pace.  Oh that wily wage-push inflation!   “Whoopsie…”

Too, by Gold’s broad-based 300-day moving average, price today is nearly +20% above such stalwart measure.  Historically since 2001, such excesses have been met with an average decline of nearly -9% during the ensuing three months.  Here’s Gold by the day since the 22 August 2011 then All-Time Closing High of 1900, the 300-day moving average as ever in blue:

Also using our BEGOS Markets’ (Bond / Euro / Gold / Oil / S&P 500) valuation tool which assesses the state of Gold relative to its movement vis-à-vis that of the other four components, price is at present +174 points above its “smooth valuation line” as is below seen per the lower panel oscillator (price less value).  Whilst that can be deemed as “high”, ’tis nevertheless a testament to Gold’s year-over-year brilliant bull run:

Sporting a far more flat run for nearly the past six months is our Economic Barometer.  To wit for the 16 incoming metrics during the week just past, period-over-period, eight improved and eight weakened:  “flat” indeed.  Amongst the standouts however, January’s ADP Employment data and both December’s Construction Spending and Consumer Credit levels all bettered their prior readings, all of which were in turn revised upward, and beat consensii.  But those losing out in all three like categories were January’s Average Workweek (in hours) along with the Institute for Supply Management’s Services Index, December’s Factory Orders and Trade Deficit, plus the prior week’s Initial Jobless Claims.  A clash of many metrics indeed!  Here’s the Baro:

As for the S&P 500, its futures contract these past two Mondays saw substantive opening down gaps such that price intra-day fell -3.0% (27 January) and -2.1% (03 February); but in both cases, the gaps filled all the way back up.  Has investing become this easy?  Indeed, has the Investing Age of Stoopid become an eternal paradigm?  Recall the Wall Street Journal front-and-center piece back pre-DotComBomb about some folks actually believing stock prices only go up?  For all who still frolic in the complacent equities’ froth, we again humbly offer this one reminder:  the same-day “lock limit down” halts for the S&P futures are -7%, then -13%, and finally -20% (which for you WestPalmBeachers down there means “TILT! Game Over!“)

But for Gold, ’tis been nothing but “Game On!”  Below we’ve our two-panel display featuring the yellow metal’s daily bars from three months ago-to-date on the left and 10-day Market Profile on the right.  The baby blue dots of regression trend consistency quite literally have pasted themselves upon the ceiling, which if we may reprise, suggests this fabulous uptrend may seeking at least some near-term bend.  Per the Profile, Gold’s volume-dominant support levels are 2845, 2797 and 2772:

Again perhaps not as robust as that for Gold — but sterling nevertheless — is the like graphic for Silver, her daily bars (below left) and Profile (below right).  And as we’ve be saying week-in and week-out for some four years, Silver as gauged by her ratio from Gold (currently 89.7x) remains cheap, the ratio’s century-to-date average being 68.7x.  Indeed priced to that average today, Silver rather than at her current 32.19 price would instead be 42.00.  But we know you shan’t forget Sister Silver:

So to sum it all up:  Gold is having a fabulous run, that realistically shall become at least a bit undone given the reality which herein penned a week ago that “hardly are markets unidirectional”.

Yet so stated, per our title, is the tease at 2900 to in turn bring 3000 unencumbered?  Such query puts us back in mind better than 20 years ago when (admittedly out of ignorance) we’d gawk at FinTV thinking we could be on the cutting edge of markets’ directions.

“Oh that was pretty ignorant, mmb…”

Squire, your affirmation of such is illustriously inspiring.  But to our point:  rumbling ’round the floor of the New Stock Stock Exchange in those days was one Arthur D. Cashin, Jr.  And we’ve always remembered this quip from him:  “Usually, if a stock gets to 90, it’s goin’ to 100.”

Thus by such theory you can see where we’re going with this:  Gold having now reached 2900 means ’tis going to 3000, albeit by what we’ve herein noted today, perhaps not directly … but eventually.  Because as aforementioned, Golden Goal Three for this year remains our forecast high for 3262!

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

07 February 2025 – 08:45 Central Euro Time

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As was the same situation ’round this time yesterday, the Swiss Franc is presently below its Neutral Zone whilst above same is Copper; session volatility for the BEGOS Markets is light. The futs-adj’d “live” P/E of the S&P 500 is 49.6x: ’twill be interesting to see if (i.e. “when”) 50x is reached, the Index as a whole remaining extraordinarily expensive if not outright dangerous. As it ought be a rangy day for the Spoo with January’s Payrolls due, key apices in the Market Profile are 6099, 6086, 6076, 6065, 6047 and 6025. Gold’s remarkable resilience continues: more on that in tomorrow’s 795th consecutive Saturday edition of The Gold Update. And for the Econ Baro in addition to the jobs data for January, we’ve also February’s UofM Sentiment Survey, and for December both Wholesale Inventories and Consumer Credit.

06 February 2025 – 08:39 Central Euro Time

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The Swiss Franc is at present below its Neutral Zone for today, whilst above same is Copper; BEGOS Markets’ volatility is mostly light. Currently we find no compelling correlations amongst the five primary BEGOS components. Still, we can go ’round the horn by their Market Values as follows (in real-time): the Bond is 1^09 points “high” above its smooth valuation line (recall our year-end comment above a potential run up into the 116s, price currently 116^02); the Euro is -0.012 points “low”; Gold — which yesterday cleared the 2900 level for the first time — is +174 points “high” and in a sixth consecutive up week; Oil is -3.34 points “low”; and the Spoo is just +32 points “high”. Incoming metrics for the Econ Baro include Q4’s Productivity and Unit Labor Costs.

05 February 2025 – 08:40 Central Euro Time

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We’ve at present the Euro, Swiss Franc and Gold above today’s Neutral Zones; below same is the Spoo, and BEGOS Markets’ volatility is mostly moderate. Looking at Market Ranges, most of the components’ EDTRs are around the mid-point of where they’ve been from a year ago at this time; those for Gold and the Euro are a bit above their mid-points. At Market Trends, all save for Oil are in 21-day linreg uptrends, including the Spoo even as it is struggling of late to stay upright. And for Market Rhythms on a pure swing basis for consistency, our top four (10-test basis) are currently the non-BEGOS Yen’s daily Parabolics (see too yesterday’s comment), the Bond’s daily Moneyflow, Gold’s 30mn Moneyflow, and the Spoo’s 2hr Parabolics. The Econ Baro awaits January’s ADP Employment data and ISM(Svc) Index, plus December’s Trade Deficit.

04 February 2025 – 08:32 Central Euro Time

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For the second consecutive week the Spoo on Monday has gapped considerably lower, yet by week’s end (in this case just after this morning’s open) come all the way back up to “fill the gap”. Regardless, the Spoo is back on the skids, at present below its Neutral Zone for today, as too are the Euro, Swiss Franc and Gold; the other BEGOS Markets are within their respective Neutral Zones, and session volatility is moderate. The non-BEGOS Yen’s daily Parabolics flipped to Short effective today’s opening price (0.0064910); we mention this as ’tis been a leading study for pure swing consistency in our Market Rhythms going back better than a year. The Econ Baro looks to December’s Factory Orders.

03 February 2025 – 08:47 Central Euro Time

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The Dollar is getting a very health bid, such that — save for the Bond (at present above today’s Neutral Zone) and Oil — the six other BEGOS Markets are in the red and all below said Neutral Zones; volatility is mostly robust. The Gold Update celebrates the yellow metal’s new All-Time High (furthered today up to 2862 basis the April cac) whilst again warning of the extreme overvaluation and fragility of the S&P 500; at this instant (per the Spoo and adjusting for Fair Value) were the stock market to open, the S&P would gap down -1.8% to 5931 from Friday’s 6041 settle. Our best Spoo Market Rhythm for pure swing consistency (10-test basis) is currently the 6hr MACD. And the Econ Baro commences its week with January’s ISM(Mfg) Index and December’s Construction Spending.

The Gold Update: No. 794 – (01 February 2025) – “Gold Achieves Golden Goal 1 of 3 – A Fresh All-Time High”

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The Gold Update by Mark Mead Baillie — 794th Edition — Monte-Carlo — 01 February 2025 (published each Saturday) — www.deMeadville.com

“Gold Achieves Golden Goal 1 of 3 – A Fresh All-Time High“

As anticipated would happen this past week per “Gold Goes Long with Three Golden Goals”, Goal One “the next All-Time High for Gold”, was achieved upon the February contract price crossing above 2802 on Thursday at 13:39 GMT, in furtherance moving to as high as 2838 before settling yesterday (Friday) at 2809.  Now add in +23 points of April contract premium (February having yesterday gone off the board) and Gold’s “continuous contract” stands today at 2832.  Indeed as herein penned a week ago, getting to Goal One would be EPLS (“easy-peasy-lemon-squeezy”).  Waiting in the wings is the Goal Two “milestone” of reaching 3000, followed during the balance of the year by Goal Three being our forecast high of 3262.

All very bullish to be sure, but we’ve wariness as well that markets do not move in a straight line.  For as depicted back in this year’s opening missive, the route to 3262 may well pass through the very low 2500s, especially should the new weekly parabolic Long trend be short-lived notably from an inflation scare followed by a Federal Reserve rate hike, should they dare, something for which the financial world at large seems unaware.

“Oh, c’mon mmb, there’s no way they’d raise, right?”

‘Tis at present not expected, Squire.  The StateSide President is glowering over the Fed to resume cutting its rates.  We instead are scouring inflation rates.  And with December’s key inflation measures  now in the books, one may say the Open Market Committee’s unanimously voting per last Wednesday’s Policy Statement to “maintain the target range for the federal funds rate at 4-1/4 to 4-1/2 percent“ was arguably the right thing to do.  For little did the en masse state of inflation change month-over-month.  Problematic thereto, however, is that every inflation metric save for the Core Producer Price Index — be it by 12-month summation or by December’s pace annualized — is still above the Fed’s goal of 2.0%.  To wit, our updated inflation table, paces with red backgrounds in excess of 2.0%:

Thus we await inflation reports for January and February toward the FOMC’s next decision due 19 March.  Conventional FinMedia wisdom apparently assumes rate cuts are to resume, whereas we’ll side with the math for what the Fed may decide.

As to “The Now”, decisiveness for the BEGOS Markets Standings year-to-date sits with Silver getting the best bid so far with our Metals Triumvirate dominating the podium.  We’ve advocated for some four years “Don’t forget the Silver!” as the Gold/Silver ratio since March 2021(then 66x) has climbed up and away from its century-to-date average which today is 68.7x versus the actual ratio now of 87.8x.  So yes, Sister Silver is leading the BEGOS bunch, but she’s still cheap!  Here’s the whole gang:

Indeed speaking of Silver, let’s take a peek at Pan American Silver (PAAS) which year-over-year is +71%, second only amongst the key precious metals’ equities brethren to Agnico Eagle Mines (AEM) that is +88%.  Filling out the following graphic of their respective percentage tracks, we also see the VanEck Vectors Gold Miners exchange-traded fund (GDX) and Gold itself both +38%, the Global X Silver Miners exchange-traded fund (SIL) +34%,  Franco-Nevada (FNV) +26%, and the lately laggard Newmont (NEM) finally +24%:

Specific to Gold, as noted ’tis in a new weekly parabolic Long trend per the next chart’s two rightmost blue dots.  To be sure, the trend across the whole one-year graphic is ever so pristinely positive.  In fact, extrapolating the dashed regression trendline through the final 47 remaining weeks in 2025 puts the year-end price at 3452 (some +190 points above our forecast 3262 high).  But again as duly written, hardly are markets unidirectional, and for Gold on this present parabolic Long trend to achieve Goal Two of the 3000 “milestone” would be fabulous.  Indeed were the dashed trendline’s pace to be maintained, Gold would reach that goal in 14-weeks’ time by that ending 08 May.  Not to hold one’s breath, but ’tis for something to play:

Turning to the StateSide economy, if you’re like us, upon the FOMC releasing a Policy Statement, we absolutely avoid exposing ourselves to the FinMedia and their excitedly emotional excesses.  Rather, we simply read the actual Statement.  And if you so did this past Wednesday, you’ll recall the opening sentence:  “Recent indicators suggest that economic activity has continued to expand at a solid pace.”

Now in the Fed’s defense (assuming by Wednesday they were not tipped off by the Bureau of Economic Analysis’ Q4 GDP data and December’s PCE data, respectively released Thursday and Friday), the FOMC did not see the stagflative suggestions therein.

“You say ‘stagflative’, mmb?”

Indubitably so, dear Squire.  First to Gross Domestic Product, for which “real” Q4 growth came in at a +2.3% annualized pace, having thus slowed from +3.1% in Q3.  But wait, there’s more:  per the “Chain Deflator”, whereas inflation contributed to 38% of nominal Q3 GDP growth, for Q4 the inflation component increased to 49%.  Thus as you learned in “B” school:  slowing growth + increasing inflation = stagflation.  Further, both of the Personal Consumption Expenditures readings increased for December, such “Fed-favoured” inflation gauge increasing from +0.1% to +0.3% (headline) and +0.1% to +0.2% (core).  What it all means for you WestPalmBeachers down there is you’re growing less but paying more.  Here’s the Baro:

However, on balance for the week the Baro managed a wee uptick.  Yet fickle amongst the 12 incoming metrics was Home Sales data.  For December, New Home Sales increased, beat consensus, and had November revised upward; but in a mirror image, December’s Pending Home Sales decreased, missed consensus, and had November revised downward.

As for the S&P 500 which fundamentally remains catastrophically overvalued given puny earnings, we’ve gone on-and-on since COVID that — earnings aside — the math-challenged FinMedia had remained rather vapid for coming up with a crash catalyst.  But now, per the above graphic and to use an expression from the old Westerns, “They’ve got their man!”  Who better, eh?   More on the S&P in our wrap.

But next let’s wrap ourselves ’round the BEGOS Markets of late.  Earlier, you saw their Standings.  Now here are the past 21 daily bars bars for all eight components with — save for Oil — all in linear regression uptrends, even as the Dollar is (barely) not net down for the year.  The baby blue dots are, of course, the day-to-day depiction of each grey trendline’s consistency.  And those for Copper (in certain circumstances considered to be a leader of precious metals’ prices) are in retreat; something for which to be sensitive:

As to the 10-day Market Profiles for the precious metals, with Gold on the left the upper 2700s appear supportive, whilst with Silver on the right same can be said for the lower 31s:

And it being month-end, ’tis time to update our view of Gold’s layered structure by the month across the last 16 years.  Indeed January was a fine start to the year for Gold:

To wrap, as noted we’ve (yet another) cautionary note with respect to the S&P 500.  The Index’s all-time closing high is 6119 as of just seven trading days ago on 23 January.  But since the ensuing six trading days — including the “Daunt de DeepSeek” of Monday, 27 January (prior to which you’ll recall we’d last week penned “…the next … ‘correction’ … shall morph Wall Street emotion from ‘No Fear!’ into ‘Nuthin’ BUT Fear!’…”) — the S&P has lost a net -78 points to now sit at 6041 (en route having been down as many as -156 points to 5963 during that Monday’s quickie-crash).  Moreover, (hat-tip Dow Jones Newswires), Deutsche Bank suggested such “…impact may see market deflate as in dot-com bust…”  Yet it giddily then came all the way back to “fill the gap”.  Oh is Wall Street — albeit now terribly fragile — ever so relieved that it didn’t all go wrong (yet).

But here’s the part for which they’ve not been informed (barring their following the website’s MoneyFlow page):  the S&P’s net change from the all-time high to right now via the MoneyFlow regressed onto the  S&P scale is -668 (“minus six-hundred sixty-eight”) points.  In other words for those of you scoring at home:  the S&P is now -78 points below its all-time closing high; but by its MoneyFlow ’tis -668 same-scale points below same.  And as you know, flow leads dough:

Or to reprise Bachman Turner Overdrive from back in ’74: “You Ain’t Seen Nothing Yet…”

Thus let it be Gold that gets your dough!

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

31 January 2025 – 08:34 Central Euro Time

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Gold yesterday achieved our anticipated All-Time High in eclipsing the 2802 level (February); the “continuous contract” now being on April (including the 27 points of fresh premium as herein noted in Wednesday’s comment) currently finds price at 2850; more of course tomorrow in the 794th consecutive Saturday edition of The Gold Update. At present for the BEGOS Markets we’ve the Bond below its Neutral Range for today, whilst above same is the Spoo; session volatility is yet again light. Amongst the correlations of the five primary BEGOS components, the best currently is negative between the Bond and Spoo. And (save for Oil), the seven other components are all in 21-day linreg uptrends (see Market Trends). ‘Tis a highly-visible data day for the Econ Baro, the incoming metrics being Q4’s Employment Cost Index, January’s Chi PMI, and December’s Personal Income/Spending featuring the “Fed-Favoured” Core PCE.

30 January 2025 – 08:45 Central Euro Time

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At present for the BEGOS Markets we’ve the Bond, Gold and Silver all above their respective Neutral Zone’s for today, whilst below same is Oil; session volatility is again light to this point. Going ’round the Market Values horn (in real-time) for the five primary BEGOS components finds the Bond basically only -1 point “low” vis-à-vis its smooth valuation line, the Euro -0.009 points “low”, Gold +91 points “high”, Oil spot on its valuation line, and the Spoo now only +23 points “high”, albeit the S&P 500 itself remains “textbook overbought”; again, our Moneyflow page for the S&P is projecting negatively. Q4 Earnings Season for the S&P 500 now shows 105 constituents having reported of which 72% having beaten their bottom lines from a year ago, an above-average pace, albeit the “live” (futs-adj’d) P/E of 45.7x remains dangerously excessive, now nearly double what ’twas a dozen years ago. Today’s incoming metrics for the Econ Baro include December’s Pending Home Sales, plus the first peek at what (by consensus) may be an stagflationary Q4 GDP (the real result slowing with the inflation element increasing).

29 January 2025 – 08:45 Central Euro Time

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All three elements of the Metals Triumvirate are at present below today’s Neutral Zones, as too is the Swiss Franc; the balance of the BEGOS Markets are within same, and volatility is light. Gold’s cac volume is rolling from February into that for April, with 27 points of additional premium: note the All-Time High for Spot Gold itself is 2790, whereas ’tis 2802 (February) and 2847 (April); the latter’s present price is 2792. Per Market Rhythms, our top two for pure swing consistency are (on a 10-test basis) the Bond’s daily Moneyflow and the non-BEGOS Yen’s daily Price Oscillator, and (on a 24-test basis) the latter for the Yen plus its daily Parabolics. Yesterday’s relief rally for the S&P 500 only recouped some 30% of Monday’s monetary outflow; again, mind the S&P 500 Moneyflow page; however, the rally did find the Spoo whipsaw back above its smooth valuation line (see Market Values); either way, the Index itself is “textbook overbought” and the “live” (futs-adj’d) P/E at this instant is 46.5x. Nothing is due for the Econ Baro today with the FOMC’s Policy Statement arriving late in the session (19:00 GMT).

28 January 2025 – 08:36 Central Euro Time

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We’ve at present the Euro, Swiss Franc and Silver below today’s Neutral Zones; Oil is above same, and BEGOS Markets’ volatility is mostly moderate. Yesterday’s -1.5% drop in the S&P 500 pales in comparison to its actual monetary outflow which was equivalent to a -11.5% S&P drop: remember, this is a leading indicator suggestive of still lower levels near-to-mid-term for the S&P. The Bond has performed splendidly as foreseen by its “Baby Blues” (see Market Trends) some two weeks ago. The Metals Triumvirate took quite a thumping yesterday, Silver notably so as the Gold/Silver ratio is back above 90x (90.3x in real-time); the current edition of The Gold Update mentioned the possibility of Gold “dropping like a stone”, and so it did to start the week with the FOMC and then key inflation data in the balance; nonetheless, Gold’s fresh weekly parabolic Long trend offers some 200 points of downside protection before such trend would reverse. The Econ Baro awaits January’s Consumer Confidence and December’s Durable Orders.

27 January 2025 – 08:46 Central Euro Time

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Save for the Bond (at present above today’s Neutral Zone), “red” is the watchword to begin the week for the seven other BEGOS Markets, all (save for Oil) at present below their respective Neutral Zones; of note, Silver, Copper and the Spoo are all down better than -1%. Session volatility is firmly moderate. The Gold Update highlights price’s weekly parabolic trend having flipped from Short-to-Long, whilst citing three key levels for which to watch: 2802 (the next All-Time High), 3000 (as a “milestone”), and then — however not necessarily on this Long run — 3262 as our forecast high for this year (see 04 January’s edition). By Market Values, the Spoo in real-time has provisionally crossed beneath its smooth valuation line: if confirmed by close, we’d anticipate the Spoo revisiting at least the 5900s, (which obviously is but within a day’s trade from here, distance-wise). ‘Tis a key data week for the Econ Baro: mind inflationary readings from both Q4 GDP (Thursday) and the December’s PCE (Friday); today brings December’s New Home Sales.

The Gold Update: No. 793 – (25 January 2025) – “Gold Goes Long with Three Golden Goals”

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The Gold Update by Mark Mead Baillie — 793rd Edition — Monte-Carlo — 25 January 2025 (published each Saturday) — www.deMeadville.com

“Gold Goes Long with Three Golden Goals“

Gold’s weekly parabolic trend finally (after a 10-week Short run) flipped to Long this past Tuesday at 15:19 GMT upon price eclipsing the 2759 level toward settling the week yesterday (Friday) at 2777.  ‘Twas a beautiful thAng, and in thanking our valued republishers we penned:  “…we look forward to a modicum of rejoicing in next Saturday’s edition …”

Thus without further ado, ’tis to rejoice:

Nevertheless, we indeed employ the noun “modicum” as in this business we know to be measured and math-oriented (unlike much of the modern-day shameless pap that passes for “analysis”:  “Well, ya know, the stock’s gonna triple in the next two weeks…” Good grief.  Put a sock in in it).

“But to your title’s point about ‘Three Golden Goals’, mmb?” 

And point-blank here they are, dear Squire, each being a key Gold price:

  • Goal One: 2802 = the next All-Time High for Gold.  The present such high (precisely 2801.8) was achieved this past 30 October.  When is the next?  As soon as Monday given present price (2777) is just -25 points below 2802 with Gold’s EDTR (“expected daily trading range”) per the website now 33 points.  Or certainly so within the new week given the EWTR (“expected weekly trading range”) is now 87 points.  Thus barring Gold only dropping like a stone from the get-go on Monday, 2802 is (to use a technical term) “easy-peasy-lemon-squeezy” (EPLS).

  • Goal Two:  3000 = nothing more than a “milestone” level up through which price shall eventually proceed.  Were our numerical world calculated in “Base 8” rather than “Base 10”, 3000 would instead be 5670, bereft of “milestone” meaning.  Regardless, Gold 3000 ought bring the mo-mo crowd to the fore in propelling price up even more.  ‘Tis achievable during this new Long trend.

  • Goal Three:  3262 = our forecast Gold high for this year as reasonably penned in our opening missive this year on 04 January.  But is that out of reach for the new Long trend?  Probably, (yet see below…)

So in specific context to the above three Gold price goals, let’s go straightaway to the math of what to rationally expect for Gold’s price rise near-term.  And no better foundation for which to measure this next Gold up leg than by reviewing price’s performance across the prior ten weekly parabolic Long trends commencing back on New Year’s Eve at the end of 2020.  The following table depicts Gold’s respective maximum gains by both price and percentage recorded for each Long trend.  We’ll then assess for this new Long trend its potential upside on a conservative, moderate, and aggressive basis:

Conservative assessment:   as aforementioned, Gold can simply drop like a stone from here, thus rendering useless the above table.  But let us focus on the rightmost column “Max Pct. Gained” during the life of each Long trend.  Therein the weakest of the bunch is +1.9%.  Repeat only that distance this time ’round would nonetheless bring Gold from its present 2777 to 2830 … and thus the attainment of Goal One (2802) as a fresh All-Time High.  A bit more realistically, note the average gain of +10.5% — less the standard deviation of -6.3% — in turn leaving +4.2% as a suggested “minimum expected gain”:  that yields Gold 2894.

Moderate assessment:   simply that average gain of +10.5% which would bring Gold 3069 … and thus the attainment of Goal Two (3000) as a “milestone”.

Aggressive assessment:   note in the same  “Max Pct. Gained” column there are two instances of Gold exceeding gains of +17%.  ‘Tis admittedly a bit of a stretch, but from 2777 to our Goal Three (3262) forecast high becomes a gain of +17.5% … just in case you’re scoring at home.  However, given our measured thinking, we’d “expect” at least one more weekly parabolic Short trend to intervene before Gold flies to the 3262 prize.

Indeed, Gold’s low thus far this year is only 2625 (06 January).  Recall from our 04 January piece:  “…applying the ‘expected yearly trading range’ method, the year’s low approximates … 2507.  Then would follow the ascent to [the] forecast high of 3262…”

Thus we ought not be put off upon still lower levels occurring en route.  To wit:  following next Wednesday’s (29 January) “maintain” Policy Statement from the Federal Reserve’s Open Market Committee comes Friday’s release of December’s Personal Consumption Expenditures Prices.  Such “Fed-favoured” gauge is expected to reveal inflation as once again increasing.  That in turn opens the door … depending on February and March inflation readings … of a Fed rate hike come the FOMC’s 19 March Policy Statement.  Wariness of such could well cap Gold’s up run, making this new Long trend short-lived.

“But mmb, what if the 2625 low is already in for this year?”

Squire, were that to turn out to be the case, then our forecast for a 3262 year’s high may be deemed in hindsight as modest.

Quintessentially modest across the past four months is our Economic Barometer.  And amongst the ensuing week’s incoming set of 13 metrics, two are specific to the first read of StateSide Q4 GDP.  Going by the flat Baro below, one cannot anticipate much growth.  Consensus suggests a slowing from Q3’s annualized +3.1% to +2.3% for Q4.

But wait, there’s more:  the inflation component therein is expected to have risen from +1.9% to +2.4%.  In other words for you WestPalmBeachers down there, Q4’s growth is “expected” to be rather stagflative, (such multi-syllabic adjective perhaps a bit much for them).

But way too much for anyone invested in the S&P 500 is its relentlessly high “live” price/earnings ratio of 47.2x.  (Note:  “AI” says … in using trailing 12-month earnings as do we … ’tis 28.8x; yet another example of Assembled Inaccuracy’s inability to do math).  Here’s the picture:

“But Q4 earnings are supposed to be great, eh mmb?”

‘Tis a good news/bad news scenario there, Squire.  To be sure for the S&P 500, Q4 Earnings Season is off to an excellent start.  Typically for the S&P, about 450 companies report with the season’s calendar guidelines.  Thus far, about 12% are in the books, within which 71% have bettered their bottom lines from Q4 a year ago:  that is an above-average showing of improvement, and hence ’tis the good news.

Now for the bad news (and if you regularly read us and/or visit the website’s S&P 500 “Valuation and Rankings” page you already well-know this):  the overall level of earnings — even as improving — remains ridiculously low compared to what entities are willing to pay to own shares.  If in our solar system Earth represents P/E acceptability, the current 47.2x level is on beyond Neptune, past the ex-planet Pluto, indeed reaching galaxies unknown.  Again we remind:  had COVID never occurred nor the subsequent “creation” of $7T, the S&P today would tolerably be — by today’s actual earnings generation — ’round the upper red line of the 46-year based regression channel:

Thus beware to those who roll their eyes over talk of a pending -50% S&P “correction”:  the possibility is quite real given we’ve already endured two such “corrections” in just the last quarter century.  Remember from the S&P’s high (1553) on 24 March 2000 that it took better than 13 years for the Index to settle just +2% higher?  Imagine how that would fare with today’s low-information, short-attention span, instant gratification crowd that vastly populate this Investing Age of Stoopid.  In fact, it might be a good idea to invest in diaper manufacturers.  For the next like “correction” — regardless of when it comes — shall morph Wall Street emotion from “No Fear!” into “Nuthin’ BUT Fear!”

‘Course, then there’s Gold. Ahhh, beautifully wonderful Gold!  Here we’ve the two-panel graphic of the yellow metal’s daily closes from three months ago-to-date on the left and 10-day Market Profile on the right. And you know the drill for the baby blue dots of trend consistency:  “Follow the Blues instead of the news, else lose your shoes.”  Too, there are a bevy of volume-driven price supports as labeled in the Profile:

Silver of late has not fared as directly up as has Gold.  To the white metal’s like display, wherein (below left) her price has tailed off somewhat and her “Baby Blues” have stalled.  You may earlier have noted in Gold’s weekly bars graphic the Gold/Silver ratio now being up to 89.5x, its highest reading in this young year-to-date.  And unlike the Market Profile support structure for Gold, Silver’s (below right) appears more overhead resistive.  Has Sister Silver exchanged her precious metal pinstripes for her industrial metal jacket, given Cousin Copper having come off of late?  ‘Tis on occasion her wont to be a bad girl…

In sum, we anticipate further near-term rising for Gold, barring — as duly noted — an inflation/Fed-hike scare.

Moreover, let’s close with this critical notion:  in addition to the three Golden goals herein described, there is, of course, a fourth:

  • Goal Four: 3822 = the opening Scoreboard’s current Dollar debasement valuation of Gold, even as adjusted for the yellow metal’s own supply increase.  No, we shan’t get there within this new weekly parabolic Long trend, let alone this year.  But ’tis sitting out there…

Reprise:  “Got Gold?”

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

24 January 2025 – 08:42 Central Euro Time

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Save for the Spoo, the seven other BEGOS Markets are higher, within which save for Oil, the other six are at present above today’s Neutral Zones; (thus obviously the Dollar Index is lower); session volatility is firmly moderate. As anticipated, Oil’s “Baby Blues” (see Market Trends) confirmed falling below their key +80%: with price presently in the mid-74s, we ought think at least the 72s are due near-term; by Market Rhythms for Oil, our best currently for pure swing consistency (10-test basis) is the 1hr Price Oscillator. The NDX (Nasdaq 100) yesterday recorded a “Hobson Close” in settling on its high trade for the session; thus a lower opening later today wouldn’t be untoward. And the Econ Baro concludes its quiet week, incoming metrics including December’s Existing Home Sales.

23 January 2025 – 08:33 Central Euro Time

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Save for the Bond, the seven other BEGOS Markets are lower, those presently below today’s Neutral Zones being Silver and Copper; volatility is quite light. Going ’round the Market Values horn for the five primary components, we’ve: the Bond nearly -3 points “low” below its smooth valuation line, the Euro -0.0095 points “low”, Gold +90 points “high”, Oil +4.43 points “high” and the Spoo +49 points “high”. The S&P 500 hit an all-time high yesterday (6101): the “live” (futs-adj’d) P/E at this instant is 47.9x and the Index is moderately “textbook overbought”. At Market Trends, Oil’s “Baby Blues” have provisionally dropped below the key +80% axis, which if confirmed at close suggests still lower price near-term. And the Econ Baro continues its muted week, the only metric due today being last week’s Initial Jobless Claims.

22 January 2025 – 08:37 Central Euro Time

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GOLD: its weekly parabolic trend as anticipated has provisionally flipped from Short-to-Long; (confirmation comes at week’s settle). For the BEGOS Markets at present, both Copper and Oil are below today’s Neutral Zones; the other six components are within same, and volatility is light. Oil’s “Baby Blues” (see Market Trends) remain above the key +80% axis, but are kinking lower in real-time. Looking at Market Rhythms, our 10-test leaders for pure swing consistency are currently Gold’s 15mn MACD, 30mn Parabolics, and 2hr MACD, plus the non-BEGOS Yen’s daily Parabolics, the Euro’s 4hr MACD and Silver’s 4hr Parabolics; for the 24-test basis we’ve still the Yen’s daily Price Oscillator and daily Parabolics, plus Silver’s 1hr Price Oscillator and the Euro’s 4hr Parabolics. The Econ Baro awaits December’s Leading (i.e. “lagging” as the Baro leads them) Indicators for which the consensus is flat (makes some sense given the Baro’s having been essentially flat these past few months).

21 January 2025 – 08:36 Central Euro Time

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The two-day session for the BEGOS Markets continues with at present the Bond, Euro, Swiss Franc and Silver atop their Neutral Zones whilst Copper and Oil are below same, thus leaving Gold and the Spoo within; volatility is robust (again this covers two days) with only the Spoo not having (yet?) exceeded 100% of its EDTR (see Market Ranges). The Bond’s “Baby Blues” are accelerating higher: price now 113^24 is up into structural resistance ranging from 113^02-114^23; however should that be eclipsed, it brings to the table a potential run toward 116^08 as first herein mentioned on 31 December per the Bond’s Market Profile at that time. Mind too the “Baby Blues” for both Gold and Oil as such metric for both markets is now above +80% but price beginning to come off a bit; Gold has yet to reach the 2759 weekly parabolic flip-to-Long level. Q4 Earnings Season starts picking up its reporting pace today.

20 January 2025 – 08:43 Central Euro Time

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Given the StateSide holiday, the BEGOS Markets enter a two-day session for Tuesday settlement with at present the Euro, Swiss Franc, Gold and Silver all above their respective Neutral Zones; none of the other four components are below same, and volatility is mostly moderate. The Gold Update highlights price having come just four points away from flipping its weekly parabolic trend from Short-to-Long: the hurdle price to so do this week is 2759 and today’s high already is 2955; we thus expect the provisional flip to Long. The Bond’s “Baby Blues” of trend consistency (see Market Trends) confirmed moving above the key -80% axis, so higher price levels ought be in the offing near-term. Similarly for Oil, we’re watching for its “Baby Blues” to break below the +80% axis from which we’d anticipate lower prices. ‘Tis a very light week for th Econ Baro with just four metrics due commencing on Wednesday; thus Q4 Earnings Season shall get the fundamental hat-tip: thus far ’tis been excellent for the S&P 500 given that 20 of the 23 companies having reported have beaten their bottom lines of a year ago; problematic of course is the “live” P/E remaining dangerously high (in futs-adj’d real-time) at 47.1x.

The Gold Update: No. 792 – (18 January 2025) – “Gold Gets Close, but No Cigar”

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The Gold Update by Mark Mead Baillie — 792nd Edition — Monte-Carlo — 18 January 2025 (published each Saturday) — www.deMeadville.com

“Gold Gets Close, but No Cigar“

“So near and yet so far.”  So says Nick-Nack to Francisco Scaramanga, –[“The Man with the Golden Gun”, Eon/UA, ’74].  So quintessentially perfect, too, does it describe Gold’s rally this past week wherein price on Thursday came within just five points (at 2758) of eclipsing the weekly parabolic Short trend level of 2763 which would have flipped said trend to Long.  But instead, price then faltered to 2729, still to rebound yesterday (Friday) up to within four points (at 2759), only to then again sink back in settling the week at 2740.  Thus the still ongoing Short trend just completed its tenth consecutive red-dotted week per this chart of Gold’s weekly bars from one year ago-to-date:

Acknowledgedly, ’twas just a week ago that we wrote “Gold’s Short Trend Nearing Its End”, and indeed as now noted, how close price came to the 2763 parabolic hurdle.  But as we therein duly penned:  “…until the present Short trend actually confirms having flipped to Long, Short remains Short…”  And whilst Gold actually has mildly risen through most of this Short trend, those rightmost red dots above have basically been a slanting roof over price.  However:  the good news for this ensuing week is the nearby opportunity for Gold’s trend to finally flip from Short to Long per the following graphic.  Depicted are Gold’s 60-minute (one-hour) candles for the entirety of this past week.  Note the two green horizontal lines:  the upper one is the 2763 level Gold needed to attain to flip the trend … again, price got close but no cigar; but the lower green line is the new 2759 level necessary to achieve the flip in this ensuing week.  And given Gold’s range statistics in the black box, 2759 is well within reach:

“But you just repeated ‘Short remains Short’ and that does look like a double-top, huh mmb?” 

Squire ever so enjoys brandishing his technical chapeau at times, and you can see in the above chart his “double-top” observance which oft sends markets lower.  To be sure, were Gold to have a “straight down” week, the Short trend remains in place.  But being just 19 points from the Longside threshold as the week unfolds — given an expected weekly trading range of 87 points — the mere ebb and flow of dough “ought be” enough for Gold to trade above 2759 within a week’s time.  Moreover should that occur, yet Gold then go on to record a down week, the trend would nonetheless already have flipped to Long.  But until that confirmingly takes place, we shan’t rule out further downside toward (as we’ve written) the upper 2400s … yet hardly shall we root for such.

Now as we work toward addressing the Economic Barometer, let’s briefly assess inflation, which if indeed perking up can initially retard Gold’s upward path.  And this past week, the FinMedia hysteria was palpable:  on the heels of Tuesday’s leading read of December wholesale inflation (Producer Price Index) — the pace of which encouragingly slowed — Dow Jones Newswires looked toward Wednesday’s retail read (Consumer Price Index) with “Stock Investors brace for possibly the ‘most important inflation reading in recent memory'” in quoting an SWBC analyst.  Then upon the retail release, Bloomy followed up with “Wall Street Sees Best CPI Day Since October 2023”.  Wrong.  (Do they no longer employ editors at Bloomy?)  December’s +0.4% CPI pace was the most since that for last March; or assuming neither you eat nor drive, the “core” pace of +0.2% — whilst off a pip from November’s +0.3% read — matched that of both May’s and July’s paces.  But as alluded to a week ago, this is what you get when human headlines are replaced with those generated by “AI” (“Assembled Inaccuracy”).

Fortunately — assuming you do your own math and analysis — you don’t make investment/trading decisions from FinMedia fodder.  Still, with respect to inflation, we’re nearly two weeks away from December’s “Fed-favoured” Personal Consumption Expenditures readings, which due 31 January come two days after the next Policy Statement from the Federal Reserve’s Open Market Committee … (but does the Bureau of Economic Analysis tip them off?  Just a thought…)

As to thinking on the Econ Baro, the past week’s robust stream of 18 incoming metrics were on balance positive.  Notable improvements were recorded for January’s Philly Fed Index along with December’s Housing Starts, Industrial Production and Capacity Utilization:  all four of those metrics posted period-over-period growth, were revised higher from their prior readings, and beat their respective consensii.

Still, growth in Retail Sales slowed.  Also, Initial Jobless Claims increased, were worse than consensus, and the prior week’s number was revised higher, (perhaps a function of folks first finishing New Year’s partying before searching for a job to pay for the credit card’s having financed it all).  But net-net, the Baro got a boost, which in turn likely leaves the Fed to sit on its hands rather than see its FundsRate come 29 January further loosed:

Truly getting a boost even within its weekly parabolic Short trend is Gold as we turn to the two-panel display of daily bars from three months ago-to-date for the yellow metal on the left and white metal on the right.  ‘Tis important to note that Gold’s baby blue dots of trend consistency have just risen above their key +80% axis:  upon their inevitably dropping beneath same, one must then be wary for lower price levels; but hopefully by then the parabolic trend shall already have flipped to Long toward limiting any substantive downside demise.  Silver’s like recent rally has been less robust than that for Gold:  thus came the past week’s rise in the Gold/Silver ratio from 86.8x to 88.3x; again with the century-to-date average ratio being 68.7x, Sister Silver remains cheap!

And for the precious metals’ 10-day Market Profiles, here we’ve those for Gold (below left) and for Silver (below right).  Obviously with Gold having had the better rally of late, we find present price (2740) higher up in its Profile than is that for Silver (31.05):

As to Gold’s price stack, here ’tis:

The Gold Stack
Gold’s Value per Dollar Debasement, (from our opening “Scoreboard”):  3817
Gold’s All-Time Intra-Day High:  2802 (30 October 2024)
Gold’s All-Time Closing High:  2799 (30 October 2024)
The Weekly Parabolic Price to flip Long:  2759
2025’s High:  2759 (17 January)
10-Session directional range:  up to 2759 (from 2627) = +132 points or +5.0%
Trading Resistance:  notable nearby Profile nodes 2748 / 2755
Gold Currently:  2740, (expected daily trading range [“EDTR”]:  34 points)
Trading Support:  2739 / 2725 / 2718 / 2705 / 2686 / 2682
10-Session “volume-weighted” average price magnet:  2697
2025’s Low:  2625 (06 January)
The 300-Day Moving Average:  2371 and rising
The 2000’s Triple-Top:  2089 (07 Aug ’20); 2079 (08 Mar’22); 2085 (04 May ’23)
The Gateway to 2000:  1900+
The Final Frontier:  1800-1900
The Northern Front:  1800-1750
On Maneuvers:  1750-1579
The Floor:  1579-1466
Le Sous-sol:  Sub-1466
The Support Shelf:  1454-1434
Base Camp:  1377
The 1360s Double-Top:  1369 in Apr ’18 preceded by 1362 in Sep ’17
Neverland:  The Whiny 1290s
The Box:  1280-1240

And so to close with another FinMedia alert so eloquently put, again courtesy of DJNw, this from last Tuesday:  “The 10-year Treasury yield is nearing 5% again.  Why stock investors are freaking out”.  ‘Course the inference there goes back to the two years prior to the FinCrisis.  Indeed for seven of the 16 months spanning from April 2006 into July 2007, the 10-year yield reached above 5%, albeit the S&P 500 rose right through that period (+20% from 1295 to as high as 1556).  Then it all went wrong — not because of a 5% yield — but rather due to lack (understatement) of lending standards.

Still, many modern-day stock investors don’t know what ’tis to truly be “freaking out”.  They’ve yet to experience the “Look Ma! No Earnings!” crash, given the current “live” price/earnings ratio of the S&P 500 (now 46.6x) eventually reverting to its 68-year evolving mean; (for those of you scoring at home, that suggests a -50% S&P correction).  Too, there’s the even scarier “Look Ma! No Money!” crash, given the current $52.9T S&P 500 market capitalization being supported by a liquid StateSide money supply [“M2”] of “only” $21.7T; (for you WestPalmBeachers down there, that means there’s more than twice as much money invested in the stock market than readily exists).

So fire up a stogie and be prepared to follow your monetary star…

 …such that you’re not spared a Gold bar and cigar!

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

17 January 2025 – 08:37 Central Euro Time

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The Euro, Swiss Franc and Silver are all at present below today’s Neutral Zones, whilst above same are both Copper and Oil; BEGOS Markets’ volatility is light. Yesterday, Gold nearly eclipsed the week’s parabolic (2763) which would flip such weekly trend from Short-to-Long: Gold’s “high if an up day” for today is 2775, so ’tis within range to still get there; more in tomorrow’s 792nd consecutive Saturday edition of The Gold Update. The Bond’s “Baby Blues” in real-time are above the key -80% axis; should that be confirmed on close, we’d seek higher Bond prices near-term with the 114s in mind; we’d mentioned the 116s a few weeks back, however they’ve since come off the Bond’s 10-day Market Profile: the low 113s to high 114s now appear initially resistive. The Econ Baro concludes its busy week with December’s Housing Starts/Permits and IndProd/CapUtil.

16 January 2025 – 08:45 Central Euro Time

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Silver, Copper and the Spoo are all at present above their respective Neutral Zones for today; none of the other five BEGOS Markets are below same, and volatility is pushing toward moderate. Leading our Market Rhythms for pure swing consistency on a 10-test basis are the Euro’s 4hr Parabolics, too Silver’s 4hr Parabolics, and the non-BEGOS Yen’s daily Parabolics; on a 24-test basis we’ve again for the Yen both its daily Parabolics and daily Price Oscillator. Mind at Market Trend’s the Bond’s “Baby Blues” as they’re (finally) making an up move: a confirm above the -80% axis would be suggestive of still high prices. And ’tis a busy day for the Econ Baro, its eight incoming metrics including January’s Philly Fed and NAHB Housing Indexes, December’s Retail Sales and Ex/Im Prices, and November’s Business Inventories.

15 January 2025 – 08:39 Central Euro Time

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The Bond is the sole BEGOS Market at present outside (above) today’s Neutral Zone; session volatility is light. We’ve noted the last few weeks the ongoing low level of the Bond’s “Baby Blues” for trend consistency (see Market Trends) as we continue to await their breaking above the -80% axis which would then be indicative of higher price levels near-term; as for the whole BEGOS bunch by trend disposition, the Bond, EuroCurrencies and Spoo all are in 21-day linreg downtrends, whilst the Metals Triumvirate along with Oil are in uptrends. Core wholesale inflation for December (PPI) was flat; today the Econ Baro looks to the month’s retail inflation (CPI); due too is January’s NY State Empire Index. And late in the session comes the release of the Fed’s Tan Tome.

14 January 2025 – 08:39 Central Euro Time

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The Swiss Franc is at present above its Neutral Zone for today, whilst below same is Oil; BEGOS Markets’ volatility is light-to-moderate. Notably for Gold, its EDTR (see Market Ranges) has been decreasing: ’twas in the upper 40s in late November whereas today’s expectation is 35 points; the opposite is true for the Spoo, which in mid-December was as low as 42 but is 87 points for today. Going ’round the Market Values horn (in real-time) for the five primary BEGOS components: the Bond shows as nearly -5.5 points “low” relative to its smooth valuation line, the Euro as -1.0195 points “low”, Gold as +25 points “high”, Oil as +9.08 points “high”, and the Spoo as -144 points “low”. December’s inflation puzzle starts today for the Econ Baro at the wholesale level with the month’s PPI; (too, still due from yesterday is the Treasury Budget).

13 January 2025 – 08:49 Central Euro Time

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The week begins with at present the Bond, Euro, Gold and Spoo all below their respective Neutral Zones for today; the other BEGOS Markets are within same, and volatility is well-moderate en route to becoming robust as the day unfolds: indeed Oil already has traded in excess of 100% of its EDTR (see Market Ranges). The Gold Update points to the yellow metal’s nearing the end of its weekly parabolic Short trend, (now entering its tenth-consecutive week as such), barring overly StateSide inflationary data due both tomorrow and Wednesday; too from a short-term trading perspective, our report highlights the recent “in hindsight” success of Gold’s one-hour Price Oscillator as a trading study to monitor. Oil’s cac volume is rolling from February into that for March. And ’tis a very busy week for the Econ Baro with 18 incoming metrics on the slate, beginning today with December’s Treasury Budget.

The Gold Update: No. 791 – (11 January 2025) – “Gold’s Short Trend Nearing Its End”

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The Gold Update by Mark Mead Baillie — 791st Edition — Monte-Carlo — 11 January 2025 (published each Saturday) — www.deMeadville.com

“Gold’s Short Trend Nearing Its End“

Whenever Gold is technically in a “Short trend” — yet price doesn’t substantively “go Down” — we say ’tis a “beautiful thAng”.  Indeed, Gold’s ongoing Short trend just recorded its ninth consecutive week per the rightmost red parabolic dots as seen here: 

More to the point, Gold settled this past week yesterday (Friday) at 2717:  that is +25 points above the current Short trend’s confirmation for initial entry back at the open on 11 November, the price then 2692; (in other words again for you WestPalmBeachers, in this case down has been up).

Further, Gold’s “expected weekly trading range” is now 87 points.  So for those of you scoring at home, given Gold’s current 2717 price, the graphic’s flip-to-Long level of 2763 (+46 points from here) is well “within range” such that in a week’s time this Short trend can have reached its end.  And once that occurs — be it in one or possibly more weeks —  Gold’s 2025 drive to 3000 shall come alive.  Then in turn, our year’s forecast high for 3262 is that for which to strive.

‘Course as you seasoned traders understand all too well, going contra-trend (oft to referred as “jumping the gun”) can lead to one’s own end.  For until the present Short trend actually confirms having flipped to Long, Short remains Short.  And whilst we regularly quip that “Shorting Gold is a bad idea”, should December’s inflation data pop in this ensuing week’s economic reports, Gold likely reverts lower, again as we’ve mused with the upper 2400s reasonably in the balance.  (Recall a week ago in forecasting the 3262 high for this year our method as well measured a year’s low ’round 2507).

All that said, Gold fundamentally is in a “Long trend” as clearly depicted in the opening Scoreboard’s righthand panel, price seemingly straining upward toward the StateSide Money Supply’s (“M2”) green line.  Specifically today at 2717, Gold is priced at 71% of its 3818 Dollar debasement valuation, even as rightly adjusted for the increase in the supply of the yellow metal itself.

And let us not overlook the white metal.  Silver settled the week at 31.30.  And as noted at the foot of the above graphic, the Gold/Silver ratio is 86.8x.  The ratio’s century-to-date average is 68.7x:  so priced to that average today puts Silver +26% higher at 39.58.  Moreover, were Gold today priced at its debasement valuation level of 3818 with the Gold/Silver ratio at that 68.7x average, Silver’s price equivalent is +78% higher at 55.60.  Reprise:  Do not forget the Silver!

“But mmb, with down being up, what is one to do?  Just sit and wait for higher Gold?” 

A super “tee-up” question there, Squire.  Buying Gold, holding Gold and just putting it securely away is the quintessential conservative play.  But if “trade one must”, let’s share with you a little internal thrust.

Should you regularly engage the website, you are aware of its “Market Rhythms” page which, when conversing with folks, we sometimes refer to as “The Goldmine”, albeit ’tis 100% based on what’s already happened.  (No one in this business ever “knows” what’s going to happen).  But to Squire’s question, one can peruse the Market Rhythms page to see what technical studies of late have been — in hindsight — attractive.  And on the list amongst 11 studies currently listed for Gold is its one-hour Price Oscillator; (assuming you have an exchange-subscribed data broadcasting system and/or graphics trading platform, you can display this technical study).

Now for the purposes of today’s missive, we’ve simplified its recent results.  Since 05 December (15:00 GMT) there have been 10 pure swing signals alternating ’round and ’round from Short-to-Long-to-Short-etc, the current signal being Long since last Tuesday at 06:00 GMT.  Below, the green line depicts in hindsight the study’s cumulative profit/loss were one to have purely swung electronically with Globex on one Gold COMEX February 2025 futures contract.  ‘Tis not bad, however as therein stated it shan’t last:  market dynamics — indeed the ebb, flow and timing thereto — are constantly shifting.  So trader beware, but of late ’tis there:

“Still, mmb, that looks pretty amazing!”

Which, dear Squire, is why ’tis said some 90% of futures traders lose it all.  For once they think they’ve “figured it out”, it stops working.  Or to quote George Peppard consoling Ralph Manza:  “It’s a rough game for amateurs” –[“Detour to Nowhere”, Universal, ’72].  For in due course, the performance in the above graphic will stop working:  ’tis merely about “The When”.  The Market Rhythms page is thus updated daily because those studies currently listed inevitably turn to failure, the list repopulating to present what’s been working best.

As to currently assess the Economic Barometer, ’tis neither failure nor feast:  rather, ’tis flat.  Cue the crowd:  “How flat is it?”  The range of the Econ Baro across the past 10 S&P 500 trading days is the flattest recorded since that ending 08 May 2019.  Still this time ’round, since Boxing Day the Baro has taken in 18 metrics for which period-over-period nine improved … meaning nine did not do so.  We thus present the El Phlato Baro:

And having earlier alluded to next week’s December inflation data, the month’s Non-Farm Payrolls net creation of 256,000 — the best since last March’s 315,000 and well above the 12-month average of 202,000 — certainly underscores the Federal Open Market Committee’s resolve not to cut The Bank’s FundsRate come the 29 January Policy Statement.  And obviously the stock market didn’t like the comparatively “robust” employment news one bit as this “good is bad” Investing Age of Stoopid rolls along.

Again as herein detailed a week ago, the Dollar Index continues to get the bid, trading yesterday to as high as 109.485, such level not seen since 10 November 2022.  The Dollar bulls sense the inflation genie is not yet fully back in the bottle to the Fed’s liking, albeit we’ll see this Tuesday/Wednesday that which the Bureau of Labor Statistics has concocted for December:  consensus at this writing suggests a slightly cooler inflation read.  Should that be the case, then we’d expect Gold to finally end its weekly parabolic Short trend.

And as we turn to Gold’s two-panel graphic of the daily bars from three months ago-to-date on the left and 10-day Market Profile on the right, the picture appears fairly upside constructive for price otherwise still being in a “Short trend”.  Note the baby blue dots of trend consistency:  they are poised come Monday to climb above the 0% axis meaning the 21-day linear regression trend shall have rotated from negative to positive.  Meanwhile, the Profile’s big belly of support starts ’round 2673:

The like graphic for Silver continues to be an almost identical twin to that for Gold.  As her “Baby Blues” (at left) work their ascent, that regression trend also looks ready to rotate to positive, whilst the Profile (at right) depicts key underlying supporters at 30.70 and 30.00.  Let’s go Sister Silver!

Thus as we wait and see if this ensuing week ends Gold’s Short-side spree, let’s wrap for today with a wee FinMedia folly.

In taking coffee here with a fabulously fine friend (who indeed is a highly-influential member of truthful media), we bemoaned the issue of the modern-day FinMedia becoming essentially less and less useful, at least from our personal perspective.  Our friend pointed to AI garnering more control of what is put upon FinMedia website home pages as “news”.  And quite obviously “Assembled Inaccuracy” begets same.  To wit this headline from Dow Jones Newswires the evening prior to Friday’s release of December’s job data:  “Investors on edge as Friday’s jobs report could make or break stock-market rally.”

Query:  ” What ‘Rally’ “?  Any of you see a “Rally”?  At least judging by the S&P 500, such “Rally” faltered five weeks ago (06 December) from which the Index on balance has fallen.  Perplexed as can be, we straightaway went to our own “live” on-screen visual of the S&P 500 futures from one month ago-to-date and captured its image as follows, some six hours prior to the release of the jobs data.  No “Rally” there by that grey trendline:

“Well, it depends from how far back you measure, mmb…”

True enough, Squire.  But today’s “info flow” seems so short-attention-spanned that to go back a month is ancient history.  Of course the S&P increased +23% in 2024, bettered (amongst our BEGOS Markets) only by Gold’s +27% gain.

But to our point, especially with respect to the above example:  we oft quip about the modern-day analysts/FinMedia cabal as being math-deficient; now we’re concerned over their becoming work-deficient.  As we’ve noted over recent years, were Grandpa Hugh in charge today (as he was back in the day), he’d fire the lot of ’em.

This underscores — especially with respect to today’s investing and trading — the critical importance of  doing the math and attendant work yourself … else be left on the shelf.  We turned off FinTV 20 years ago and are better off for having so done.

It also underscores the importance of staying with Gold … and Silver as bold!

Cheers!

  …m…

www.TheGoldUpdate.com
www.deMeadville.com
and now on “X”:  @deMeadvillePro

10 January 2025 – 08:47 Central Euro Time

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Gold is presently the sole BEGOS Market above its Neutral Zone for trading: price is over 2700 for the first time since 13 December. The balance of the BEGOS components are within today’s respective Neutral Zones, and volatility is light. By Market Profiles, the Spoo (5947) is trading just below its most dominantly-traded price by volume across the past fortnight of 5951; the Euro (1.3200) is nearly on same (1.0330). For correlation amongst the five primary BEGOS Markets, the current best has shifted from being positive Euro/Spoo (see 08 Jan comment) to now negative Oil/Spoo. And at Market Trends, Copper’s linreg has (in real-time) provisionally rotated to positive: of the eight BEGOS Markets, the only other component with positive linreg remains Oil. The Econ Baro awaits January’s UofM Sentiment Survey, plus December’s Payrolls data (per Labor).