20 January 2025 – 08:43 Central Euro Time

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”

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)
2024’s High:  2802 (30 October 2024)
Gold’s All-Time Closing High:  2799 (30 October 2024)
The Weekly Parabolic Price to flip Long:  2759
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
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)
2024’s Low:  1996 (14 February)
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

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

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

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

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

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”

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

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).

09 January 2025 – 08:37 Central Euro Time

StateSide equities are closed today, however the BEGOS Markets are running with early closures for both the Spoo (14:30 GMT) and Bond (18:15 GMT). At present, both the Bond and Copper aabove up their respective Neutral Zones for today; the Euro is below same, and volatility is light. Looking at Market Rhythms: on a 10-test basis, the best of the bunch are currently the Euro’s 4hr Parabolics and 15mn MACD, along with the non-BEGOS Yen’s daily Parabolics and daily Price Oscillator; the latter two also rank best on a 24-test basis. And whilst ’tis too soon to get a read on Q4 Earnings Season, of the 20 companies having thus far reported — none of which are S&P 500 constituents — 70% (14) have beaten “estimates”, but only 50% (10) have actually bettered their bottom lines from Q4 a year ago. The futs-adj’d “live” P/E of the S&P at this instant is 45.9x.

08 January 2025 – 08:41 Central Euro Time

All eight BEGOS Markets at this moment are above water; the sole one above its Neutral Zone for today is Copper; session volatility is quite light. At Market Trends, we still await the Bond’s
“Baby Blues” to turn the corner up through their -80% axis. Too, per correlations amongst the five primary BEGOS Markets, the best currently is positive between the Euro and Spoo. Yesterday, the S&P 500 dropped a net -1.1%; however its Moneyflow suggested a fall of -3.8% to be more in order: as this is a leading indicator, we look for lower S&P levels near-term; the Spoo (currently 5960) by its its Market Profile shows 5935 as its last bastion of near-term support. The Econ Baro looks to December’s ADP Employment data, plus November’s Wholesale Inventories and (late in the session) Consumer Credit; with the StateSide equities not trading tomorrow, last week’s Initial Jobless Claims also come into the Baro today. The FOMC’s 18/19 Meeting Minutes shall be released.

07 January 2025 – 08:29 Central Euro Time

The Euro, Swiss Franc, Silver and Copper are all at present above today’s Neutral Zones; none of the other BEGOS Markets are below same, and volatility is again pushing toward moderate. By Silver’s Market Rhythms on the daily period, both the Parabolics and MACD triggered Long signals effective today’s open (30.485). We’ve not mentioned a primary BEGOS Markets’ correlation in recent weeks given the components have been rather scattered through transition into New Year; that noted, by Market Trends, (still save for Oil) the other seven markets remain in 21-day linear regression downtrends; therein we continue to monitor the Bond’s “Baby Blues” in awaiting their moving above the key -80% axis; indeed by Market Values, th Bond (in real-time) is better than -4.5 points below its smooth valuation line. For the Econ Baro today we’ve December’s ISM(Svc) Index and November’s Trade Deficit.

06 January 2025 – 08:39 Central Euro Time

Both the Bond and Copper are presently below their respective Neutral Zones for today; the balance of the BEGOS Markets are within same, and volatility to this point is pushing towards moderate: all three elements of the Metals Triumvirate, along with Oil, have already exceeded 50% of their EDTRs (see Market Ranges). The Gold Update cites our selected high for this year: 3262 using the “expected yearly trading range” method; that noted, Gold still continues to run its weekly parabolic Short trend, now entering a ninth week. From a Market Rhythms perspective, Gold’s 1hr Parabolics study has been indicative of worthy results mid-December-to-date (24-test basis). Some 12 metrics are due this week for the Econ Baro, beginning today with November’s Factory Orders. And Q4 Earnings Season commences.

The Gold Update: No. 790 – (04 January 2025) – “Our Gold High for ’25”

The Gold Update by Mark Mead Baillie — 790th Edition — Monte-Carlo — 04 January 2025 (published each Saturday) — www.deMeadville.com

Our Gold High for ’25

A little cheer to start the new year:  “We’re Number One!”

 

Yes, across the 2024 BEGOS Markets’ spectrum, the year’s best performer was Gold’s +27.4% increase.  ‘Course, for the math-challenged FinMedia, all the talk has instead been over the S&P 500’s +23.3% gain.  ‘Tis the quintessential example of “Money talks, Wealth whispers”(Got Gold?)

On to 2025. And as ’tis been absolutely eons since we’ve had a pop quiz in The Gold Update, let’s begin the year with one. Ready?

  • What was the last year wherein Gold netted a yearly gain for a third consecutive time?

If (without looking it up) you answered “2012” you’ve earned a Gold Star.

Moreover, through this century-to-date’s 24 completed years, Gold netted yearly gains 12 consecutive times from 2001 through 2012.

Since then however, such streak has succumbed to becoming “herky-jerky” (technical term).  Following those 12 consecutive up years, Gold then netted:

  • Three consecutive yearly losses from 2013 through 2015;
  • Two gains for 2016 and 2017;
  • A loss in 2018;
  • Two gains for 2019 and 2020;
  • Two losses in 2021 and 2022;
  • Two gains for 2023 and 2024.

Thus if such “herky-jerky” pattern of these past 12 years continues, Gold shall suffer a net loss for this year 2025 … but we don’t think so.  Rather, for the first time since 2012, we look to Gold’s recording a third consecutive net yearly gain.

Despite the FinMedia’s disinclination to highlight Gold, from our purview it continues to quietly be gaining a wee degree of (pardon the yucky woke word) “awareness”.  To the extent that Gold ownership is increasing is a reflection of its price having risen, certainly so across the past two years.

Still, trying to estimate the percentage of Gold owned by various entities yields quite a large standard deviation.  Pro-Gold bugs push that a mere 0.5% of individuals carry exposure to the yellow metal; AI (“Assembled Inaccuracy”) puts portfolio exposure up toward 10%; and (hat-tip The World Gold Council) private individuals own more Gold than do governments and banks combined.

Regardless — and with specificity to the debasement of currency as the ultimate driver of valuation — Gold’s price trend clearly is up.

“So let’s get to it, mmb:  what’s Gold’s high gonna be for this year?” 

First, Squire, as acknowledged above, Gold could put in a down year.  Should StateSide inflation — which as you regular readers know — remain above the Federal Reserve’s +2% target, interest rate decreases then morph back into increases.  In turn, the Dollar becomes more attractive still, and both the horrifically overvalued S&P 500 and Gold (at least initially) descend.  Naturally, inflation inevitably works back into Gold’s favour.  But such negative scenario is quite real — one might even say “anticipated” amongst the currency bunch — given the Dollar’s increase throughout Q4 of last year.  Indeed for 2024 per our the BEGOS Markets’ Standings, the Dollar Index netted an annual gain of +7.1% … but Gold (which as you know plays no currency favourites) went up anyway.

Still, at the end of the day, we expect Gold’s positives to will out, and certainly so the creation of more dough.  To repeat that herein penned just a week ago:  And the month’s Main Event commences 14 January upon U.S. Secretary of the Treasury Janet ‘Old Yeller’ Yellen begging for dough upon which to draw to pay obligations on the nation’s debt.”  Whoopsie.

As to Gold’s high in ’25:  recall a year ago our opening missive was entitled “Gold – We Conservatively Forecast 2375 for 2024’s High“ … and such forecast turned out to indeed be “conservative”, price rather swiftly arriving at the 2375 target on 09 April en route to the current All-Time High of 2802 on 30 October.  For 2025, we’re a bit more “aggressive” especially having just acknowledged Gold could put in a down year.

However, given our perspective that ’twill be an up year, in establishing a forecast Gold high, we employed the quantitative aspects used to present the website’s “Market Ranges” page, in this case to solve for Gold’s “expected yearly trading range”.  We like this approach as it supports maintaining prudent cash management, (the most important element of trading).

Now obviously we don’t expect Gold to go straight up; however we do see the low coming before the high.  Recall from recent missives that Gold is currently in a weekly parabolic Short trend, which — given other negative technicals — we’ve mused price perhaps tapping the upper 2400s near-term.  And applying the “expected yearly trading range” method, the year’s low approximates that area at 2507.  Then would follow the ascent to its forecast high of …  … 3262.  ‘Tis thus basically a +30% run from low-to-high as 2025 unfolds.  For now, Gold yesterday (Friday) through the first two trading days of the year settled at 2653.  Achieving our 3262 level may seem a very long row to hoe, but with 250 trading days remaining in 2025, there’s time.

In the meantime, let’s go to Gold’s aforementioned weekly parabolic Short trend, the rightmost red dots now eight weeks in duration.  Yet at present, the positively sloping dashed trendline is on pace to reach 3262 within the year, albeit obviously such trend can rotate to negative:

Now it being month-end, indeed year-end plus two trading days, let’s bring up the percentage tracks of Gold and key of its equities’ brethren from one year ago-to-date.  Therein we see at best Agnico Eagle Mines  (AEM) +54%, followed by Pan American Silver (PAAS) +37%, Gold itself +29%, the Global X Silver Miners exchange-traded fund (SIL) +22%, the VanEck Vectors Gold Miners exchange-traded fund (GDX) +18%,  Franco-Nevada (FNV) +9%, and Newmont (NEM) actually -5% given the company’s increased production costs:

Producing a rather sideways swath since September is the Economic Barometer, even as the S&P 500 on balance manically runs up and away from it.  This past week’s light set of Econ Baro metrics included for December an improved Institute for Supply Management Manufacturing Index, but a drop in the month’s Chicago Purchasing Managers’ Index.  Too came a better November reading for Pending Home Sales, but a zero growth pace for the month’s Construction Spending.  Put it all together — and economically — ’tis “Happy Blah Year, America!”

To which we earlier alluded, the Dollar’s been on a three-month up run.  And you know the drill:  as the Dollar is getting the substantive bid, everything else (save for Oil) is in a skid.  By the following graphic we go ’round the horn for all eight BEGOS Markets with their daily bars from one month ago-to-date.  Thus with the exception of Oil, the seven other components all are sporting negative grey regression trendlines, the baby blue dots depicting the day-to-day consistency of those respective trends.  (Pssst:  are you still in the stock market?  Just askin’…)  Here’s the graphic:

Turning to the 10-day Market Profiles for the precious metals, both Gold on the left and Silver on the right have moved above their respective mid-points.  Gold’s most dominant trading support price by volume is 2630, whilst for Silver ’tis 30.00:

And toward wrapping 2025’s first piece, here we’ve Gold’s monthly bars across the past 15 years.  Were Gold’s “Infamous Triple Top” to permanently hold, preceding stratified layers basically become obsolete.  ‘Course a -50% Gold correction would plop price back into the 1300s.

“Oh really, mmb, c’mon man…”

To be sure, Squire, hardly do we anticipate such demise from here.  Yet historically, Gold has suffered through some serious spills.  More recently was price’s -23% decline from August 2020 into November 2022; precedent to that was the -46% tumble from September 2011 into December 2015; and of course, too, was Gold’s -68% fall from the skies running January 1980 into June 1982.  But we shan’t lose any sleep over such, especially should 3262 be in this year’s balance:

So there’s our Gold forecast high for ’25:  3262.  And honestly it may be “A Bridge Too Far” –[United Artists, ’77].  But again per our premise of Gold gaining a third consecutive up year and as guided by the “expected yearly trading range”, 3262 seems a reasonable target from a prudent cash management perspective.

Indeed hardly do we have much negative concern over Gold.  Per the opening Gold Scoreboard’s valuation level of 3809, Gold is looking ever so attractively fine given inevitably price has so much more to climb.

But when it comes to the stock market as measured by the S&P 500, we remain significantly concerned (understatement).  Remember old “Fritz” Hollings’ (D-SC) famous line from back in his time?  “There’s too much consumin‘ goin’ on out there!”  To peruse today’s FinMedia one might instead say “There’s too much euphoria goin’ on out there!”   We read (paraphrasingly) that:  “The S&P’s the place to be!” “Without AI you cannot be!” “Trump to put Bitcoin in orbital spree!”  Oh gee.

Today finds the S&P 500’s “live” price/earnings ratio at 46.8x, at least double any historical rationale; the Index’s market cap is $52.4T for which the supportive liquid money supply is “only” $21.7T.  (For you WestPalmBeachers down there, that means you sell your stock, but you might not get the money).  Oh gee.

AI seems to have given up on trying correctly quote the price of Gold; you may recall our asking AI what the price was three different times during the course of last year, the response in each attempt being wrong by $100s; today rather than quote a price, it simply says that it is best to check a financial news website.”  Oh gee.

Dear old Bitcoin in round numbers essentially is 90% mined and trading at $100k/coin.  Consensus is ’twill reach $250k/coin this year.  “The Trumpster” is purportedly bidding (on behalf of the insolvent USA — remember “Old Yeller” needs money by mid-month) for one million coins, i.e. $100 billion-worth, which actually is not that much money given ’tis roughly what the federal government spends per week.  But will you be offering to the nation your Bitcoin, and at what ask?  Oh gee.

So with 3262 potentially in the year’s balance, can you imagine not being with Gold?  Oh gee!

Cheers!

  …m…

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

03 January 2025 – 08:39 Central Euro Time

The Swiss Franc is at present above its Neutral Zone for today, whilst below same is Copper; BEGOS Markets’ volatility is light following it being robust for yesterday’s session. Going ’round the Market Values horn for the five primary BEGOS components in real-time, we’ve the Bond as nearly -3.5 points “low” vis-à-vis its smooth valuation line, the Euro -0.022 “low”, Gold just +16 points “high”, Oil +4.11 points “high” and the Spoo -94 points “low”. At Market Trends, its remains that — save for Oil — the other seven BEGOS Markets are in negative linreg trends. Of note therein, the Bond’s “Baby Blues” are just barely curving upward (-88% in real-time): once they confirm a close above the -80% axis, that can bring the run up into the 116s (current level is 114^04). The Econ Baro concludes another quiet week with December’s ISM(Mfg) Index.

02 January 2025 – 08:45 Central Euro Time

2025’s trading commences finding all eight BEGOS markets at present in the black, those notably above today’s Neutral Zones being the Swiss Franc, Gold, Silver and the Spoo; session volatility is moderate-to-robust. As we’ll see in the next Gold Update for this Saturday, the yellow metal was the best BEGOS performer of 2024, +27.4%. The futs-adj’d “live” P/E of the S&P 500 is 46.4x and the yield 1.274% versus 4.208% annualized for the risk-free 3-month U.S. T-bill, (albeit as mentioned in the current edition of The Gold Update, “Old Yeller” faces an ‘event of default’ come mid-month barring another Congressional bailout). The Bond (113^28) has just climbed above 113^26, its most dominantly-traded price across the past fortnight: as mentioned in Tuesday’s comment, there’s room for the Bond to move up into the 116s. The Econ Baro get’s 2025 underway, today’s incoming metrics including November’s Construction Spending.

31 December 2024 – 08:41 Central Euro Time

Into the year’s final stint we go, with at present both the Bond and Oil above their respective Neutral Zones for today; none of the other BEGOS Markets are below same, and volatility again is light. We’d noted yesterday the Bond’s being quite extended below its smooth valuation line (see Market Values) such that a rise into New Year wouldn’t be untoward: mind at Market Trends the Bond’s “Baby Blues” of trend consistency to support a higher price upon their eclipsing up through the -80% axis; (in real-time they are -91%); for price itself currently 114^16, by its Market Profile there is room to move all the way up to volume resistance at 116^08. The S&P 500 enters its last trading day of the year with a “live” (futs-adj’d) P/E of 46.0x, still dangerously high by any historical yardstick. On to 2025, et Bonne Anneé à Tous!

30 December 2024 – 08:46 Central Euro Time

Both Gold and the Spoo are presently below today’s Neutral Zones; the balance of the BEGOS Markets are within same. and volatility is light. The Gold Update points to price’s ongoing technical negativity, however stating it being more hesitant than in a downtrend; too from a century-to-date perspective (23 completed years), Gold has a tendency to trade net higher for the final two days of the year, whereas the S&P 500 has a tendency to trade net lower. At Market Trends, with the exception of Oil, the seven other BEGOS components are all in negative linreg trends from a month ago-to-date. An interesting trade for which to watch into New Year is the Bond: ’tis (in real-time) nearly -5 full points below its smooth valuation line (see Market Values); typical downside deviation extends to around -3 points. With nothing on its slate for tomorrow, the Econ Baro completes its year today with December’s Chicago PMI and November’s Pending Home Sales.

The Gold Update: No. 789 – (28 December 2024) – “Gold’s Weak Wend Toward Year-End”

The Gold Update by Mark Mead Baillie — 789th Edition — Monte-Carlo — 28 December 2024 (published each Saturday) — www.deMeadville.com

Gold’s Weak Wend Toward Year-End

Gold just recorded its seventh down week in the last nine, price settling yesterday (Friday) at 2637 … and yet that is higher than Gold’s settle six weeks ago at 2567 on 15 November.

To be sure, Gold’s 21-day (one month) linear regression trend is negative, and as next shown, the red-dotted weekly parabolic trend remains Short, now seven weeks in duration.  Across the past nine weeks, Gold’s seven down bars are in red and its two up bars are in green:

“So what you are saying mmb is that price is going down even though it is going up, right?” 

In support of Squire, ’tis not an effect of excessive eggnog imbibement.  Rather — from a strictly quantitative aspect — we’ve merely a mathematical marvel that makes you go “hmmm…”  Yes, the parabolic trend is Short, price therein having achieved but two up weeks.  And yet Gold seems more hesitant rather than in decline.  Still, the climb from the present 2637 level to eclipse the ensuing week’s “flip-to-Long” level at 2772 is +135 points.  Given Gold’s expected weekly trading range is 85 points, look for this trend to likely remain Short through New Year, barring any buying extravaganza.

Too, as noted in recent missives, Gold’s weekly MACD (moving average convergence divergence) continues to negatively expand as next displayed.  Again, through having measured prior MACD declines, ‘twouldn’t be untoward to see Gold tap the upper 2400s on this run, (our preference of course being that it not so do):

Thus is our near-term downside Gold view.  Now let’s consider the near-term upside view.  If for some unconscionable reason you missed reading yesterday’s Prescient Commentary, from that we’ve this key snippet:  “…The Market Magnets of all three elements of the Metals Triumvirate appear poised for penetration to the upside, meaning prices may get a lift into New Year…”  Let’s explain.

“You mean for your so-called ‘WestPalmBeachers down there’, mmb?”

‘Twould appear Squire is already getting a giddy dose of New Year’s penetration, but to his valid point.  The “Metals Triumvirate” simply refers to Gold, Silver and Copper, each of which maintains a daily, updated page on the website.  Our proprietary “Market Magnet” measure is justifiably named as price inevitably is drawn back to its Magnet.  Specifically as a trading tool however, upon price penetrating its Magnet, further near-term price follow-through is the expected rule rather than the exception.  To wit the following graphic (a tad tight in this display, but viewable as well at the website):

The upper panel for each market tracks its daily closing price (thin line) from three months ago-to-date; the thick line is the Magnet.  The lower panels are the oscillative difference of price less Magnet.  And what is evident in all three cases is price now poised to penetrate Magnet to the upside, suggesting a rally for the metals into New Year.  (Again, you can monitor such daily progression at the website).

Meanwhile, struggling for further upside progression — albeit duly holding its own through autumn — is the Economic Barometer.  This past week was very muted for the Baro given the wee slate of just four incoming metrics.  Therein of note, December’s Consumer Confidence declined on the heels of November’s Durable Orders having shrunk; however, that month’s New Home Sales did increase.  So “When the Econ Baro comes bob-bob-bobbin’ along…”–[hat-tip Harry Woods, ’26], there appears little impetus for the Federal Open Market Committee’s voting to again nudge lower its Bank’s FundsRate come the 29 January Policy Statement.  Moreover as herein depicted a week ago, StateSide inflation is still running a bit hot for the Fed’s liking.  Either way, here’s the Baro:

And from the bobbin’ Baro we return to burrowin’ Gold per the following two-panel display of price’s daily bars from three months ago-to-date on the left and 10-day Market Profile on the right.  Although in this missive’s close we’ll cite Gold typically having an upside bias for the final two days into year-end, below we’ve the baby blue dots of trend consistency breaking lower.  As for the Profile, a bevy of notable support and resistance levels are labeled:

Continuing to be the like case is that for Sister Silver, her “Baby Blues” (at left) accelerating to the downside along with more resistance than support per her Profile (at right):

To close, we’ve two full trading days remaining for 2024. Conventional wisdom presumes “Oh this is gonna happen!” and “Oh that is gonna happen!” as year-end market hysteria unfolds.  From our purview, we don’t think much at all is “gonna happen”.

To break it down a bit for those of you scoring at home:

  • Notwithstanding Gold’s weak wend toward year-end, century-to-date with just two trading days left in the balance, price’s median percentage change either way has been 0.7%.  The bias is to the upside, 18 of those 23 yearly finishes being higher for the two days.

  • But as to the S&P 500 with just two trading days left in the balance, its median percentage change either way has been 0.6%, the bias being to the downside as 14 of those 23 two-day finishes were lower.

“So mmb, at Monday’s open we go Long Gold and Short the S&P for two days, eh?”

Tempting as ’tis, Squire, the best way always to go is with prudent cash management.

Regardless, as you know, the old saying is “As goes January so goes the year.”  And the month’s Main Event commences 14 January upon U.S. Secretary of the Treasury Janet “Old Yeller” Yellen begging for dough upon which to draw to pay obligations on the nation’s debt.  As was so brilliantly scripted in Paramount’s ’64 feature “Paris When It Sizzles”, the Secretary’s performance shall be that Ultimate and inevitable moment. The final, earth-moving, studio-rent-paying, theatre-filling, popcorn-selling” plea to Congress for extraordinary measures to avoid default.

‘Course, the best anti-default asset is Gold!

Next week we’ll have 2024’s final standings of the BEGOS Markets (Bond, Euro/Swiss, Gold/Silver/Copper, Oil, S&P 500) along with your favourite month-end graphics, (plus two trading days into 2025).  Until then:

Happy Sizzlin’ New Year and Cheers!

  …m…

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

27 December 2024 – 08:40 Central Euro Time

At present, the Swiss Franc is the only BEGOS Market outside (below) its Neutral Zone for today; session volatility to this hour continues quite light. By Market Rhythms, the current best for pure swing consistency are — on a 10-test basis — the non-BEGOS Yen’s daily Parabolics and daily Price Oscillator, Gold’s 8hr Parabolics, and the Spoo’s 15mn Moneyflow, whilst — on a 24-test basis — we’ve again those same two Yen and Spoo studies, plus Gold’s 1hr Parabolics and the Swiss Franc’s 2hr MACD. The Market Magnets of all three elements of the Metals Triumvirate appear poised for penetration to the upside, meaning prices may get a lift into New Year: we’ll take at look at those in tomorrow’s 789th consecutive Saturday edition of The Gold Update.

26 December 2024 – 08:18 Central Euro Time

Gold is the sole BEGOS Market at present outside (above) today’s Neutral Zone; session volatility is again very light. That notwithstanding, Tuesday’s +1.1% gain for the S&P 500 now places the “live” P/E (futs-adj’d) at an amazing 48.7x: ’tis double what might be considered an acceptable modern-day norm, and triple that taught in B-school for the norm during a bull market; again, the +$7T printed to counter the negative effects of COVID fungibly found its way into the S&P, the market-cap for which increased by same. True, risk-free U.S. debt is yielding triple that of the S&P’s paltry 1.234%, but risk-full stocks remain the “sexy” place to be; mind too our S&P 500 “Valuations & Rankings” page. The Econ Baro wraps its week today with last Saturday’s Initial Jobless Claims.

24 December 2024 – 08:40 Central Euro Time

The abbreviated trading session presently finds all eight BEGOS Markets within their respective Neutral Zones for today, and session volatility is very light. Looking at Market Rhythms for pure swing consistency, on a 10-test basis the leaders currently are the non-BEGOS Yen’s daily Price Oscillator and Parabolics, plus Gold’s 8hr Parabolics; for the 24-test basis ’tis the same two Yen studies along with Gold’s 4hr Moneyflow, notably which just flipped to Short at today’s open. At Market Trends (in real-time) six of the eight BEGOS Components are in negative linregs, the only two positive being for Copper and Oil. And at Market Values, two notable deviations are the Bond’s being nearly -4 points below its smooth valuation line and the Euro -0.018 points below same. No incoming metrics are due today for the Econ Baro. Joyeux Noël d’ici à Tous !

23 December 2024 – 08:19 Central Euro Time

As the first of two abbreviated trading weeks begins, we’ve at present both Silver and the Spoo above today’s Neutral Zones; none of the other BEGOS Markets are below same, and volatility is light. The Gold Update points to the disparate inflation reads wherein the BLS reads it as increasing whilst the BEA sees it as decreasing; Gold itself remains in its weekly parabolic Short trend, perhaps en route to test the upper 2400s given the expanding negativity of the weekly MACD. Moneyflow into the S&P 500 continues to be robust, our page thereto so showing for each of the weekly, monthly and quarterly charts, even as the “live” P/E remains an unsustainable 47.3x. The Econ Baro kicks off its subdued week with December’s Consumer Confidence, plus November’s Durable Orders and New Home Sales.

The Gold Update: No. 788 – (21 December 2024) – “Gold Seeks Charisma ‘Round Inflation’s Enigma”

The Gold Update by Mark Mead Baillie — 788th Edition — Monte-Carlo — 21 December 2024 (published each Saturday) — www.deMeadville.com

Gold Seeks Charisma ‘Round Inflation’s Enigma

Welcome to winter as we type literally through the soltice here at 10:21 CET.  And let’s start with a “Thumbs Up!” to one Elizabeth Morgan Hammack, graduate of THE Leland Stanford Junior University, today President of the Federal Reserve Bank of Cleveland, and who — as a voting member of the Federal Open Market Committee — had the “cojones” to not go in favour of last Wednesday’s -25bps reduction for the FedFundsRate to its new 4.25%-4.50% Target Range.

“So are you taking credit for her having read last week’s Gold Update, mmb?” 

Heavens no, dear Squire.  Rather, we’re just favourably impressed that — instead of being FinMedia-led as seems is the Fed — Ms. Hammock can do math sufficiently such as to realize inflation has been going the wrong way as precisely depicted in our prior missive.  Brava Beth!

Yet such credit due, suddenly yesterday (Friday) the inflation situation completely whirled ’round down!  November’s so-called “Fed-favoured” inflation gauge — the mouthful entitled Personal Consumption Expenditures Prices Index — came in at a wee +0.1% at both the headline and core paces.  That materially differs from the Consumer Price Index’s readings of +0.3% (headline and core) and the Producer Price Index’s respective +0.4% and +0.2% readings.  ‘Course, whilst both the CPI and PPI are calculated by the U.S. Bureau of Labor Statistics, the PCE is figured by the U.S. Bureau of Economic Analysis.  Thus by the BLS gauge, inflation is increasing, whereas by the BEA, inflation is decreasing.  Hence our title including “Inflation’s Enigma” as trust in the overall picture is a bit of a stigma.  Powell & Co. may be pleased over November’s PCE, but the averages clearly state inflation is higher as in the table we see:

In turn challenged by it all, Gold is doing its darnedest to seek some charisma.  Despite price’s rampant volatility, Gold settled the week at 2641, “net net” again being little changed as we’d seen the week prior.  Two weeks ago, Gold traced 112 points for a net change of only +11; now this past week, Gold traced 87 points for a net change of only -25.  Thus Gold’s net two-week change is but -14 points. Reprise Chris Isaak’s tune from back in ’95: Goin’ Nowhere

That warbled, Gold has wobbled on balance a bit lower within the context of its ongoing parabolic Short trend per the weekly bars as next shown from a year ago-to-date.  Indeed, this past week’s low — 2597 — was the lowest level traded since 2569 back on 18 November.  Further upon this Short parabolic trend’s commencement, you may recall our penned suggestion of “…Gold revisiting the upper 2400s on this run…” given the weekly MACD (moving average convergence divergence) also then having crossed to negative, which since has continued to deteriorate.  Rather anti-charismatic, that.  To the bars and rightmost red-dotted Short trend, now six weeks in duration:

Yet both Gold and the S&P 500 celebrated yesterday’s release of the benign PCE:  intraday low-to-high Gold gained +1.9% and the S&P +2.6% as the increasingly inflationary aspects of the CPI and PPI were swiftly forgotten.

‘Course, the S&P 500 put in one of the wildest week’s points-wise in its 67-year history:  Wednesday’s net S&P loss of -178 points ranks fifth worst since the Index’s inception in March 1957; (on a percentage basis, the day’s -2.9% loss ranks 132nd-worst since at least as far back as 1980).  Notwithstanding Friday’s PCE-induced rally, Wednesday was a torrid reminder of just how fragile the stock market has become;  Moreover, the “live” price/earnings ratio of the S&P 500 settled the week at 46.5x.  But until COVID’s “bonus” $7T finds its way to better-returning investments, (i.e. short-term U.S. debt currently yielding more than triple that of the S&P), the Great Game of Chicken continues per this image from the “Marked-to-Market Everyone’s a Millionaire Dept.”

Hardly “chicken” of late has been the Economic Barometer, which (along with the increasing CPI and PPI) does justify the Fed to at least “pause” rate reductions come 29 January’s Policy Statement from the Open Market Committee.  And as you regular website readers know, we emphasize the leading characteristics of our analytics.  Two of note from this past week were in the daily Prescient Commentary.  From Tuesday:  “…the S&P … is so overcooked to this point both fundamentally and technically that some degree of downside hoovering awaits; perhaps ’twill be a ‘sell the priced-in’ Fed announcement tomorrow”Bingo.  From Thursday: “…Leading (i.e. ‘lagging’) indicators … are supposed to be mildly negative, but an ‘unch’ or mildly positive read wouldn’t surprise us given the Baro’s recent resilience.”  Bingo.

‘Tisn’t magic; rather ’tis merely doing the math.  And the Baro’s incoming metrics for November have been sufficiently buoyant for a gain in the Conference Board’s Leading Indicators of +0.3%; but instead, the “expert consensii” were looking for a loss of -0.1%.  “How’s that Ivy League education workin’ out for ya?”  

In moving to the graphic, of the past week’s 20 incoming metrics, there were notable improvements in Retail Sales,  Existing Home Sales and Building Permits.  Too, Personal Spending increased, albeit its underlying Income slowed.  As well on Friday, December’s Philly Fed Index boffed the Baro a bit, but its overall stance has been fairly firm since Late summer:

Meanwhile, precious metals’ prices across the past three months have been skiing the bumps as below depicted for Gold on the left with Silver on the right. And as to their respective trend’s consistency, the “Baby Blues” are tracking nearly identically, meaning of course that Sister Silver —  rather than adorned in her industrial metal jacket (as when aligned with Cousin Copper) — is instead sporting her white-on-white precious metal pinstripes.  Gettin’ some air there, baby!

Too, because of their downhill runs, prices at present are quite low within the 10-day Market Profiles for Gold (at left) and for Silver (at right).  Notable high volume support and resistance prices are as labeled:

Thus as we glide into winter and the first of two back-to-back abbreviated trading weeks, let’s assess the state of The Stack:

The Gold Stack
Gold’s Value per Dollar Debasement, (from our opening “Scoreboard”):  3788
Gold’s All-Time Intra-Day High:  2802 (30 October 2024)
2024’s High:  2802 (30 October 2024)
Gold’s All-Time Closing High:  2799 (30 October 2024)
The Weekly Parabolic Price to flip Long:  2777
10-Session “volume-weighted” average price magnet:  2681
Trading Resistance:  notable nearby Profile nodes 2653 / 2670 / 2679 / 2690
Gold Currently:  2641, (expected daily trading range [“EDTR”]:  44 points)
Trading Support:  2634 / 2620 / 2608
10-Session directional range:  down to 2599 (from 2761) = -162 points or -5.9%
The 300-Day Moving Average:  2329 and rising
The 2000’s Triple-Top:  2089 (07 Aug ’20); 2079 (08 Mar’22); 2085 (04 May ’23)
2024’s Low:  1996 (14 February)
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

In sum, Gold whilst seeking some charisma at least technically still looks to falter a bit; but fundamentally as the late great Richard Russell would remind us, there’s never a bad time to buy it.  This gem to wit, courtesy of The Royal Mint:

Indeed, Merry Everything to Everybody Everywhere and don’t forget the Gift of Gold!

Cheers!

  …m…

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

20 December 2024 – 08:44 Central Euro Time

Gold is presently above its Neutral Zone for today, whilst below same is the Spoo; BEGOS Markets’ volatility is light-to-moderate. Looking at correlations amongst the five primary BEGOS components, the best currently is positive between the Euro and the Spoo; the latter’s linear regression trend (see Market Trends) appears poised to rotate from positive to negative, if not today, then come Monday; again, prior to the S&P 500’s Wednesday rout, the daily Parabolics on the March Spoo already had flipped from Long to Short effective last Monday’s open. November’s Leading Indicators indeed came in as positive despite the “consensus” for a negative reading: as herein penned yesterday, they “…are supposed to be mildly negative, but an “unch” or mildly positive read wouldn’t surprise us given the Baro’s recent resilience”; ’tis why we regularly refer to them as “lagging” indicators given the Baro leads them. And for today, incoming metrics include November’s Personal Income/Spending along with the “Fed-favoured” inflation read via the Core PCE. Our November inflation table shall thus be complete for tomorrow’s 788th consecutive Saturday edition of The Gold Update.

19 December 2024 – 08:46 Central Euro Time

Following an across-the-board down day for all eight BEGOS Markets, we’ve at present the Euro, Swiss Franc, Gold, Silver and Spoo all above their respective Neutral Zones for today; the other three components are within same, and volatility is moderate-to-robust, Gold notably already having traded 90% of today’s EDTR (see Market Ranges). Prior to yesterday’s downdraft for the S&P, we’d herein penned early Tuesday that “…for the S&P … ’tis so overcooked to this point both fundamentally and technically that some degree of downside hoovering awaits; perhaps ’twill be a ‘sell the priced-in’ Fed announcement…” which indeed resulted: ’twas the S&P’s fifth-worst one-day points slide (-178) in its history and on a percentage basis (-2.9%) in nearly the 99th percentile of worst one-day losses. In midst of it all, by Market Values, the Spoo reached back down to its smooth valuation line. Incoming metrics for the Econ Baro today include Q3’s final GDP read, December’s Philly Fed Index, plus November’s Existing Home Sales and Leading (i.e. “lagging”) indicators: that latter are supposed to be mildly negative, but an “unch” or mildly positive read wouldn’t surprise us given the Baro’s recent resilience.

18 December 2024 – 08:38 Central Euro Time

Copper is at present below its Neutral Zone for today, whilst above same is the Spoo; BEGOS Markets’ volatility is quiet ahead of the Fed. The S&P 500 is now 29 trading days “textbook overbought” and indeed so through 44 of the past 48; the “live” P/E (futs-adj’d) is at this instant 48.4x; technically, the daily Parabolics on the March Spoo are into their fourth Short day, and the 12hr MACD continues to sink, now at its lowest level since the negative crossover was confirmed from 09 December; and by Market Values, the Spoo in (real-time) is +163 points above it smooth valuation line; the other four primary BEGOS Markets are reasonably near their own like metric. Even as inflation is increasing, the Fed is expected to cut its Funds Rate by -25bps, the FOMC Policy Statement due at 19:00 GMT, prior to which the Econ Baro receives November’s Housing Starts/Permits and Q3’s Current Account Balance.

17 December 2024 – 08:16 Central Euro Time

Copper is presently below its Neutral Zone for today; the balance of the BEGOS Markets are within same, and volatility is again light. Per our MoneyFlow page, the S&P 500 has received substantive inflow across all three of our time measures (weekly, monthly. quarterly): the inference thus is bullish for the S&P; however, ’tis so overcooked to this point both fundamentally and technically that some degree of downside hoovering awaits; perhaps ’twill be a “sell the priced-in” Fed announcement tomorrow; as noted yesterday, the Spoo’s daily Parabolics have just flipped to Short. For the Econ Baro today we’ve December’s NAHB Housing Index, November’s Retail Sales and IndProd/CapUtil, plus October’s Business Inventories.

16 December 2024 – 08:37 Central Euro Time

The busy week begins with the Swiss Franc at present the sole BEGOS Market outside (above) its Neutral Zone for today; session volatility is light. The Gold Update graphically depicts last week’s “Spike n’ Sink”, price initially driven up geopolitically and on the CPI, then back down on the PPI and a bit of Fed doubt; highlighted therein is inflation being back on the increase, the Dollar in turn getting the bid throughout last week. As to notions of an S&P 500 “Santa Claus Rally”, across the past 44 years for these seven trading days leading up to Christmas ’tis not occurred in 13 of them (i.e. ’tis not automatic); indeed the Spoo’s daily Parabolics flipped to Short effective today’s open. Cac volume for the Spoo is rolling from December into that for March, and for Oil from January into February. For the Econ Baro there are 19 metrics due this the week, 10 of which arrive prior to Wednesday’s FOMC Policy Statement; today brings December’s NY State Empire Index.

The Gold Update: No. 787 – (14 December 2024) – “Gold Does the Spike n’ Sink”

The Gold Update by Mark Mead Baillie — 787th Edition — Monte-Carlo — 14 December 2024 (published each Saturday) — www.deMeadville.com

Gold Does the Spike n’ Sink

Gold’s net change for this past week was a wee +0.4%; yet ’twas hardly mute en route.  Prior to settling yesterday (Friday) at 2666, price was boffed about by another geo-political “spike n’ sink”, further impinged by November’s StateSide inflationary data.  Here ’tis:

Briefly as to the geo-political “spike n’ sink” — and you regular readers well know this — when Gold “spikes” on geo-political nervousness as was the case this past week over Syria — price zooms upwards.  Then swiftly it “sinks” as such jitters fall from the headlines and short-term memories move on to the next event.

But when it comes to inflation — even as the FinMedia and investing community couch it as “benign” — you cannot fool the Dollar, nor the Bond, nor Gold.  For per the U.S. Bureau of Labor Statistics, inflation at both the retail and wholesale level is increasing, indeed moving further up and away from the Federal Reserve’s desired target of +2.0%.  Here’s what we have thus far for November:

Obviously to complete the above table, we await November’s “Fed-favoured” Personal Consumption Expenditures Prices Index due next Friday, 20 December, which conveniently for the central bank is two days after its Open Market Committee’s 18 December Policy Statement.  Regardless, what does our table thus far depict? 

At its foot we see the average 12-month summation of the elements is +2.8%; through October ’twas +2.6%… Whoops!  Moreover, the November annualized average is +3.6%; that for October was +3.0%… Whoops!  Time to pick up the telephone and call the Fed:  “Hey Jay!  We’re goin’ the wrong way!” 

And yet, they’ll likely lop another 25bps off the Funds Rate come Wednesday, as absent of math, the modern-day Fed apparently acts on optics.  “A cut is expected?  A cut we shall do!”  And given rate cuts effectively increase the money supply through the Fed window, more Dollars distributed into the monetary system (barring economic efficiency) lead to more inflation.  For more are worth less; the “wrong way”, indeed. 

However, to read the also math-challenged FinMedia, increasing inflation is not their take.  Hat-tip Bloomy, which in response to rising retail inflation (the Consumer Price Index) ran on Wednesday with “Stocks Rise After CPI Gives Fed Green Light to Cut”.  Really?  The CPI quickened its October pace of +0.2% to +0.3% for November … which annualized as noted is +3.6% … which further distances itself from the Fed’s +2.0% target.  That’s a green light to cut? 

But wait, there’s more:  into Wednesday evening Bloomy embellished its response by adding “US Inflation in Line With Forecasts Solidifies Bets on Fed Cuts”.  Really?  We can only guess that —  again mathematics aside — merely meeting forecasts is all that counts, even as inflation increases.  This is adroitly akin to contemporary stock market valuation:  the substance of earnings (or lack thereof) no longer has meaning, just as long as they “beat estimates”.  Thus Syria + CPI = Spike. 

‘Course come Thursday came the negative news.  Wholesale inflation (the Producer Price Index) for November recorded a +0.4% pace, the fastest across the past seven months…  Whoops!  But whilst the FinMedia rather skirted the issue, not so did the Dollar, nor the Bond nor Gold, the rationale being that perhaps the Fed shan’t cut.  In turn, the Dollar got the Bid, the Bond did the skid, and Gold hit the lid.  PPI + Rate Doubt = Sink.

So as we go to Gold’s weekly bars from a year ago-to-date, the rightmost closing nub shows barely a net change from a week ago — despite the “spike n’ sink” — as the parabolic Short trend continues.  Today at 2666, Gold sits -116 points below the ensuing week’s flip-to-Long level of 2782; thus if you’re scoring at home, given Gold’s expected weekly trading range is now 90 points, ’tis likely the Short trend shall still be in place in a week’s time:

Now as noted, we expect the Fed — wrongly — to cut.  ‘Tis even priced into the FedFundsFutures despite the firming of the Dollar — rightly — and attendant weakness in the Bond and Gold.  And truly for the trader, mis-valuation breeds opportunity; the trick however is to remain solvent until everyone else sees it. 

To wit for the Casino 500, its “live” price/earnings ratio settled yesterday at a spritely 47.8x.  Fundamentally, that is an overbought danger which has become indescribable.  Technically, we’ve also these year-to-date stats:  the S&P has recorded 241 trading days; ’tis been “textbook oversold” for just 28 days, at a neutral stance for 51 days, and “textbook overbought” for 162 days, including through 42 of the last 46 days.  To be sure, we’re taught “the market is a hedge against inflation.”  We just displayed annualized inflation running at +3.6%; the S&P year-to-date is +27%.  But we get it:  all that COVID-elicited $7T is still sloshing around in the stock market.

“Plus, it’s just in time for the Santa Claus Rally, eh mmb?” 

So sayeth conventional wisdom, Squire.  But it doesn’t always come to pass.  There remain seven trading days until Santa’s arrival.  How has the S&P historically fared for such seven days?  We went all the way back to 1980 (which for you WestPalmBeachers down there covers the past 44 years).  And yes, there generally is an upside bias for the seven trading days to Christmas, yet:  in 13 (30%) of those years, such seven-day stint was net negative for the S&P.  Thus “buyer beware”.

Either way, the frightening overvaluation of the S&P 500 reminds us yet again that
“marked-to-market everyone’s a millionaire; marked-to-reality nobody’s worth squat.” 

Always worth its plot however is that of the Economic Barometer.  As many of you know, the Baro across its first 22 years essentially led the direction of the stock market as measured by the S&P 500.  But then came COVID after which such relationship ceased.  (Did we mention the S&P is overbought?)  Going inside the data of the past week’s 11 incoming metrics for the Econ Baro, period-over-period saw three improve, two maintain, and six worsen, the latter leaning in favour of a Fed cut as the analytics included a significantly lower revision to Q3’s Unit Labor Costs, plus the highest level of Initial Jobless Claims across the past nine weeks.  Besides, the FinMedia have already ordered (as usual) the Fed to cut its Funds Rate:

 

Indeed speaking of rate, that at which Gold did the “spike n’ sink” was quite quick this past week.  ‘Tis again very evident below in the left-hand panel of price’s daily bars from three months ago-to-date, the baby blue dots of trend consistency just Friday having kinked lower.  In the right-hand panel we’ve Gold’s 10-day Market Profile, the range of which spans 124 points; currently 2666, price sits just above its most commonly traded handle — labeled at 2664 — across the fortnight:

And we’ve the same drill for Silver, her “Baby Blues” at left also having just kinked lower yesterday.  Then at right per her Profile, she is sitting on her last bastion of near-term support at 31.00.  Hang in there Sister Silver!

Thus into a very busy “Fed Week” we go during which 19 metrics come due for the Econ Baro, 10 that are scheduled prior to the FOMC’s Policy Statement late Wednesday.  Since the FinMedia have assured us the Fed will cut, is that already priced into Gold?  But then again, hearsay has it the Bank come 29 January shall “pause” post-Santa Claus; so hold any applause.

And always make sure you’ve some Gold in your claws!

Cheers!

  …m…

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

13 December 2024 – 08:24 Central Euro Time

All eight BEGOS Markets are presently within today’s Neutral Zones, and volatility is very light. The Yen’s Long signal herein cited on 03 December is provisionally failing: ’tis based upon the daily Price Oscillator dominating the Market Rhythms for pure swing consistency (on a 24-test basis); such signal would now swing to Short. The S&P 500 yesterday produced a “Hobson Close” in settling on its low level for the session: this last occurred on 26 August 2022, following which the S&P some seven weeks later was down by more than -13%, albeit we don’t give such events predictive shrift, whereas the futs-adj’d “live” P/E for the S&P is an unsustainable 46.4x. ‘Tis rollover for the currencies from the December cacs to those for March. And the Econ Baro wraps its week with November’s Ex/Im Prices.

12 December 2024 – 08:20 Central Euro Time

The Euro, Silver and Copper are at present all above their respective Neutral Zones for today; none of the other BEGOS Markets are below same, and volatility is mostly light. Yesterday’s +0.8% rise in the S&P 500 is “media-credited” to the CPI — whilst yet again above the Fed’s desired pace — having met “expectations” in turn “guaranteeing” a rate cut come the FOMC’s 18 December Policy Statement; (yes, ’tis nonsensical). Looking at current correlations amongst the five primary BEGOS components, the best is negative between the Euro and Oil; notably, Oil yesterday confirmed a close above its Market Magnet, suggestive of still higher prices near-term, perhaps a breakout above the mid-71s top from two weeks ago. Included in today’s incoming Econ Baro metrics we’ve November’s wholesale inflation reads per the PPI.

11 December 2024 – 08:40 Central Euro Time

Both the Euro and Swiss Franc are presently below today’s Neutral Zones; none of the other BEGOS Markets are above same, and volatility is mostly moderate, save for the Spoo, for which the EDTR (see Market Ranges) has been been swiftly narrowing: two weeks ago ’twas 67 points, today ’tis set for 47 points. Looking at Market Rhythms, on a 10-test basis the consistency swing leader is Silver’s 8hr Price Oscillator, followed by the non-BEGOS Yen’s daily Parabolics which flipped to Short effective today’s open, counter to the Yen’s daily Price Oscillator: that study on the 24-test basis is Long. The Econ Baro gets its first dose of November’s inflation data at the retail level via the CPI; too, late in the session comes the month’s Treasury Budget.

10 December 2024 – 08:40 Central Euro Time

Gold is the sole BEGOS Market outside (above) its Neutral Zone for today; session volatility for the BEGOS Markets is quite light. Gold has been getting a bid as the week unfolds, albeit ‘twould “appear” to be geopolitically-driven: as you regular readers know, such impetus for Gold rallies generally sees price return back down from whence it initially came; again, the parabolic weekly trend for Gold remains Short. As to the Spoo, its 12hr MACD confirmed a negative crossover effective today’s open: this has been an excellent Market Rhythm for the the Spoo with the last 10 such crossovers (to Long or Short) all following-through with at least an additional 76 points; thus basis the March cac (which opened today at 6134) a move down to at least 6058 would be reasonable, barring first an all-time high above 6179. The Econ Baro awaits the revisions to Q3’s Productivity and Unit Labor Costs.

09 December 2024 – 08:24 Central Euro Time

At present we’ve the Euro below its Neutral Zone for today, whilst above same is Gold; BEGOS Markets’ volatility is light-to-moderate. The Gold Update cites the narrowing of price’s trading range such that ’tis anticipated the current parabolic Short trend shall carry on for at least another week; provided as well is evidence of the S&P 500’s extreme “textbook overbought” condition, both technically and fundamentally. Amongst Market Rhythms, we’re minding the Spoo’s 12hr MACD as ’tis been a solid signaling performer from August-to-date: its next stance would be from Long-to-Short within a day or two, barring price resuming its upside breakout. Metrics are due every day this week for the Econ Baro, starting today with October’s Wholesale Inventories.

The Gold Update: No. 786 – (07 December 2024) – “Gold Boring; S&P Warning”

The Gold Update by Mark Mead Baillie — 786th Edition — Monte-Carlo — 07 December 2024 (published each Saturday) — www.deMeadville.com

Gold Boring; S&P Warning

First, this tease:  the last time the S&P 500 reached (by our quant-crunching) such current duration of being extremely “textbook overbought”, the mighty Index fell …(drumroll)… -26%.  More on that later.

To Gold:  on the heels of last week’s brief missive, here we go as promised with what otherwise would normally be our “month-end “graphics-rich edition, in this case right up-to-date through yesterday, 06 December.  And as entitled “Gold Boring”, clearly for price ’twas a snoozer of a week, the -1.7% high-to-low range ranking fourth narrowest year-to-date toward our yellow metal settling yesterday (Friday) at 2655 in recording its fifth weekly loss in the last six.

Regardless, it now being a week past November’s month-end and with just four editions of The Gold Update remaining in 2024, let’s straightaway go to our BEGOS Markets’ Standings since New Year.  And as was the case at October’s end, the precious metals remain upon the top two steps of the podium followed by the zany, earnings-lacking, non-monetarily-supported S&P 500 in third place.  Too, from the “Gold Plays No Currency Favourites Dept.”, note the Dollar Index is nearly +5% year-to-date, with Sweet Sister Silver still leading the percentages pack:

But in turning to Gold’s weekly bars from a year ago-to-date, the present red-dotted parabolic Short trend has completed a fourth week in duration, something that has not occurred since the 14-week run of being Short back in 2023 from that year’s weeks ending 26 May through 25 August.  And per the graphic’s lower panel, to nix a fifth week of Short trend, price need trade up through 2786, (which is just -16 points shy of Gold’s 2802 All-Time High recorded this past 30 October).  Strictly by Gold’s expected weekly trading range of 88 points, 2786 at least imminently is “out of range”.  Either way, this year-over-year image remains fabulous, the yellow metal up +30%:

Now as would normally be our month-end wont, along with Gold’s +30% year-over-year gain, let’s next see how it compares with the performance tracks of highly visible precious metals’ equites. Thus from worst-to-first we’ve Newmont (NEM) +4%, Franco-Nevada (FNV) +13%, the VanEck Vectors Gold Miners exchange-traded fund (GDX) +21%, Gold itself as noted  +30%, the Global X Silver Miners exchange-traded fund (SIL) +41%, Pan American Silver (PAAS) +45%, and topping the list Agnico Eagle Mines  (AEM) +58%.  On three (one, two, three):  “Way to go, Agnico!”

Next we drill down into the 10-day Market Profiles for Gold on the left and for Silver on the right.  And per prices’ present positioning, we can see that Silver has been fairing a bit better.  Two weeks ago, the Gold/Silver ratio was 86.6x, having since been reduced to now 84.3x, substantiated by Silver having increased across said stint by +2.0% whereas Gold has slipped -0.6%.  ‘Course, it remains that Gold relative to Dollar debasement is very cheap and in turn, relative to Gold, Silver is super cheap.  That noted, here’s the rather congested (certainly for Silver) current view:

As to Gold more broadly, here’s our updated depiction of Gold’s layered structure across the past 15 years, the rightmost monthly bar being December’s initial week.  Our forecast high for this year — couched last New Year as “conservative” — was for a run from year-end 2023’s settle at 2072 to 2375; instead, Gold went well on to reach an All-Time High at 2802.

“Well, you were right until it passed 2375, mmb…”

Thanks, Squire:  we’ll take all the shameless plugs we can get, (courtesy of the “We Love It When We’re Wrong Dept.”)  Here’s the graphic.

Now as we glide toward our opening S&P tease — indeed a true scare for the unaware — let’s next go ’round the horn for all eight BEGOS Markets during the past 21 trading days (one month) along with each component’s grey diagonal regression trendline and “Baby Blues” which depict the day-to-day consistency of trend.  Obviously the best of the bunch has been the Bond, (for which in our 20 November Prescient Commentary we penned “…The Bond’s ‘Baby Blues’ [see Market Trends] have … moved above their key -80% axis:  thus we look to still higher Bond prices near-term…”  Notably, the trend of the S&P 500, too, is on the rise, albeit therein the “Baby Blues” are faltering.  Here’s the whole gang:

And so to the entitled “S&P Warning” we go.  As graphically follows, the S&P 500 is the red line along with the Economic Barometer from one year-ago-to-date.  Like you veteran readers and website devotees know, from its inception back in 1998 up to COVID in 2020, the Econ Baro would broadly lead the direction of the S&P.  ‘Course upon COVID and the subsequent mass printing of more money, such leading phenomenon has since ceased.  For with the +44% in additional Dollars swiftly injected into the StateSide liquid financial system came the like $7 Trillion increase to the market capitalization of the S&P 500, such that ’tis become impossible for it to go down, let alone materially despite the Baro having fallen through much of the year:

“But mmb, you said at the beginning something about a 26% fall in the S&P…”

So here’s the skinny, Squire.

Going away back to the days of AvidTrader (and indeed by this measure since the year 1980), when the S&P 500 gets a bit far afield from itself — either up or down — we quantitatively couch it as mildly, moderately or extremely “textbook overbought” or “textbook oversold”.

Through yesterday’s (Friday’s) S&P 500 settle at 6090, ’twas the eighth consecutive day of being extremely “textbook overbought”.  And across the past 45 calendar years, on a mutually-exclusive basis, such eight-day run has only occurred 14 other times.  Doesn’t sound like much right?

But wait, there’s more:  the last time this current condition came to fruition was in November 2021 from which the S&P’s fall within one year was -26%, (inclusive of recession fears — and the Econ Baro today is significantly lower than ’twas then).  The prior occurrence came in 2019 from which the fall within one year was -25%, (inclusive of the 2020 COVID mini-crash).

And yet the inevitable next time ’round, a like percentage drop might actually be considered small. Why?  Don’t forget:  had COVID never happened, the S&P today would at best be around 3000 and all would be as happy as clams.  Instead, today ’tis at 6000 with the honestly-calculated price/earnings ratio now 46.9x, which is double the norm, and triple what was taught as “acceptable” in B-school.  For you WestPalmBeachers down there, that means company earnings haven’t increased commensurate with stocks prices.  To wit we update this closing graphic of the S&P 500 across the past 50 years with the extrapolated regression channel had COVID never happened.  Fortunately however, earnings are no longer meaningful for stocks’ pricing:

‘Course, your “expert” all-in equites money manager has the appropriate protection in place, right?  (Pssst … and given the current $53T market cap of the S&P is supported by a liquid U.S. money supply of “only” $22T, broker-issued IOUs will be made available, right?)

“Got Gold?”

Cheers!

  …m…

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

06 December 2024 – 08:43 Central Euro Time

Presently, all eight BEGOS Markets are within their respective Neutral Zones for today, and volatility to this point of the session is light-to-moderate. The Metals Triumvirate is thus far getting the most play, the EDTR (see Market Ranges) tracings being 68% for Silver, 71% for Copper and 77% for Gold. As anticipated, both the Euro and Swiss Franc have moved higher since their “Baby Blues” (see Market Trends) climbed above their -80% axes coming out of last week. And going ’round the Market Values horn for the five primary BEGOS components we’ve (in real-time) the Bond as better than +3 points “high” above its smooth valuation line, the Euro -0.012 points “low”, Gold -20 points “low”, Oil -1.43 points “low” and the Spoo +229 points high. The S&P 500 has been at an “extreme” level of being “textbook overbought” now for seven consecutive trading days, a condition not seen since early November 2021, following which the Index “corrected” by better than -22% over the ensuing eight months. The Econ Baro concludes its week with December’s UofM Sentiment Survey, November’s Payrolls and late in the session October’s Consumer Credit.

05 December 2024 – 08:27 Central Euro Time

The Euro is the sole BEGOS Market outside (above) its Neutral Zone for today; session volatility is very light. Gold’s 12hr Parabolics flipped to Long effective today’s open: of the 405 Market Rhythms run each evening, this one ranks in the top ten and has produced a minimum of 17 points of follow-through (either Long or Short) in nine of the past 10 signals; of course, the more dominant weekly Parabolic trend remains Short; too, (inclusive of real-time), Gold’s 21-day linear regression trend is neutral, its “Baby Blues” (see Market Trends) smack on their 0% axis, but themselves rising. For the S&P 500, its “live” (futs-adj’d) P/E is now 46.6x, the Index now overbought through 35 of the past 39 trading days, and at our “extreme” level through the past six. Today’s incoming metrics for the Econ Baro include November’s Trade Deficit.

04 December 2024 – 08:36 Central Euro Time

At present, all eight BEGOS Markets are within their respective Neutral Zones for today, and session volatility is light. In looking at Market Ranges, notably narrowing of late include those for the Bond, Silver, Copper, Oil, and to some extent the Spoo. As to Market Rhythms’ pure swing consistency, on a 10-test basis the current leaders are Oil’s 15mn Moneyflow, Silver’s 1hr MACD and 8hr Price Oscillator, plus the non-BEGOS Yen’s daily Parabolics; on a 24-test basis the current best are Gold’s 2hr MACD, and as has been mentioned in multiple commentaries, the non-BEGOS Yen’s daily Price Oscillator. The Econ Baro looks to November’s ADP Employment data, ISM(Svc) Index and October’s Factory Orders. Then late in the session comes the Fed’s Tan Tome.

03 December 2024 – 08:42 Central Euro Time

At present below today’s Neutral Zones are the Bond and Swiss Franc; above same are Silver and Copper, and session volatility is light-to-moderate. The non-BEGOS Yen’s daily Price Oscillator — which has be dominating the top of our Market Rhythms runs on a 24-test basis for pure swing consistency — confirmed flipping from Short to Long at today’s open: currently 0.0066815, ‘twould be well within historical performance range to see an ascent up to at least .0068940 into year-end; (the average full swing duration of this Rhythm over the past three years is some seven trading weeks). Also for currencies, just as yesterday we cited the Swiss Franc’s having (by Market Trends) its “Baby Blues” cross above the key -80% axis, so too now has that measure for the Euro; the Dollar’s weakening over the past two weeks looks to further strengthen these attendant currencies. ‘Tis a quiet day for the Econ Baro which yesterday benefitted by both the ISM(Mfg) Index and Construction Spending.

02 December 2024 – 08:32 Central Euro Time

Save for Oil, ’tis a red start to December for the seven other BEGOS Markets, each one (except for the mildly negative Spoo) at present below their respective Neutral Zones for today; volatility is firmly moderate, likely pushing toward robust as the day unfolds. The S&P 500’s “textbook overbought” stance is at our “extreme” reading: indeed ’tis been overbought for 17 consecutive trading days and in total for 32 of the last 36; the “live” (futs-adj’d) P/E is presently a whopping 45.5x and the yield 1.228%; that annualized for the risk-free 3-month T-Bill is 4.373%. On Friday, the Swiss Franc’s “Baby Blues” (see Market Trends) confirmed crossing above the key -80% axis, indicative of still higher prices: currently 1.1327, a near-term push to at least 1.1442 wouldn’t be untoward. The Econ Baro begins December with November’s ISM(Mfg) Index and October’s Construction Spending.

The Gold Update: No. 785 – (30 November 2024) – “Gold in 60 Seconds (IV)”

The Gold Update by Mark Mead Baillie — 785th Edition — Cortona, Arezzo, Toscana — 30 November 2024 (published each Saturday) — www.deMeadville.com

Gold in 60 Seconds (IV)

Saluti dalla Toscana!  As indicated a week ago, our missive this time ’round is a brief read, but to the point; (our usual month-end graphics content shall instead be to-date in a week’s time).

Gold settled the abbreviated trading week yesterday (Friday) at 2674, -128 points below its All-Time High of 2802 (30 October).  But price’s points volatility is well above normal:  the average high-low weekly trading range across these past four is 132 points, such like average not seen since that ending 09 April 2020 as COVID unsettled the investing world.

Regardless of Gold’s recent careening about, the current weekly parabolic Short trend just completed its third week.  And should price in this ensuing week not eclipse up through 2791 (i.e. +117 points above present price), such Short trend shall have completed a fourth consecutive week for the first time since that ending 25 August 2023.  Here are Gold’s weekly bars and parabolic trends from a year ago-to-date:

 

Also as anticipated in our prior missive, the Core Personal Consumption Expenditures Price Index would be this past week’s key metric.  Such “Fed-favoured” inflation gauge registered for October at +0.3%, which annualized of course is +3.6%, thus exceeding the Federal Reserve’s preference for a +2.0% pace.  And per our table for October’s inflation measures, the Core PCE’s actual 12-month summation of +2.8% too remains Fed-excessive, as does every cell in the graphic, save for the headline Producer Price Index:

Generally, Gold responds positively to Fed benevolence.  And come the Open Market Committee’s next Policy Statement on 18 December, whilst ’tis not set in stone for a FedFunds rate cut, the conventional wisdom “assumption” shall look to another -25bp reduction.  For after all, Fed policy tends — indeed is “expected” — to trend.  And a Fed cut ought redound well for Gold, perhaps reversing the weekly parabolic trend from Short back to Long and further to a new All-Time High just in time for Christmas.

Further, the Economic Barometer remains rather steady through recent months.  Were it instead to be rising, it might give pause for the Fed to — well — pause.  Moreover, 33 metrics still are due for the Baro prior to the next Fed meeting in two-and-a-half weeks’ time.  Alors, on verra.  Here’s the Baro:

Thus in brief this week for Gold, our bottom line is to remain wary of price — at least technically — sporting some degree of confusion given the aforenoted volatility.  To be sure, the weekly parabolic trend is Short, and by Gold’s page at the website, the 21-day linear regression trend is negative; however both Gold’s “BEGOS Market Value” and Market Magnet appear at present non-committal as to near-term direction.  Yet to better one’s analytical perspective, by our Market Rhythms page, there are presently 11 for Gold which qualify to make that list, (as updated daily).

‘Course — fundamentally — priced today at 2674 versus the opening Scoreboard’s debasement valuation of 3778 reminds us that broadly:  Gold is still ever so cheap!

Ciao!

  …m…

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

29 November 2024 – 08:48 Central Euro Time

The two-day abbreviated session for the BEGOS Markets continues with just the Swiss Franc at present outside (below) its Neutral Zone; volatility for the combined session is moderate. Of note from our Market Magnets page, those for both the Euro and Swiss Franc have been price penetrated to the upside, whilst for Gold to the downside: such penetrations are indicative of continued near-term direction. The Spoo suggests a higher open for the S&P 500, its “textbook overbought” streak to be further extended. Early BEGOS Market’s closures are as follows (all GMT): the Bond 18:15, EuroCurrencies 19:45, Metals Triumvirate 19:45, Oil 19:45, and the Spoo 19:15. As stated in the still current edition of The Gold Update, tomorrow’s edition shall be quite brief given our writing remotely this time ’round.

28 November 2024 – 08:26 Central Euro Time

Whilst StateSide ’tis the Thanksgiving holiday, the BEGOS Markets are active for two abbreviated sessions combined into Friday settlement. And at present below their Neutral Zones are the Euro, Swiss Franc and Silver; the balance of the components are within same, and volatility is light. Going ’round the Market Values horn of the five primary BEGOS elements, we’ve (in real-time) the Bond as some +1.2 points “high” above its smooth valuation line, the Euro -0.018 points “low”, Gold as -51 points “low, Oil as -1.24 points “low” and the Spoo as 206 points “high”. Yesterday, the S&P 500 completed its 16th consecutive trading days as “textbook overbought”, indeed its 31st of the past 35. Today’s GLOBEX trading halts commence from 18:00 GMT for the Spoo through the usual 22:00 GMT for the currencies.

27 November 2024 – 08:02 Central Euro Time

Save for the mildly lower Euro, Oil and Spoo, the balance of the BEGOS Markets are higher; notably above their Neutral Zones at present are the Swiss Franc and Metals Triumvirate; session volatility is light ahead of a large load of incoming EconData. Our top two current Market rhythms for pure swing consistency are (on a 10-test basis) Copper’s 15mn Parabolics and Silver’s 8hr Price Oscillator; too (on a 24-test basis) remains the non-BEGOS Yen’s daily Price Oscillator, plus Gold’s 30mn Price Oscillator. StateSide, ’tis the final full trading day of the week. And for the Econ Baro, incoming metrics today include October’s Personal Income/Spending, “Fed-favoured” Core PCE Prices Index, Durables Orders and Pending Home Sales, plus the second peek at Q3 GDP.

26 November 2024 – 08:30 Central Euro Time

Presently, all eight BEGOS Markets are in the red and all (save for the Bond) below today’s Neutral Zones; volatility is mostly moderate. The S&P 500 continues its “textbook overbought” stance: however, yesterday’s MoneyFlow belied the Index’s up day of +0.3%, citing it ought instead have been -2.0%; the MoneyFlow of the S&P is a leading indicator (see The S&P 500, MoneyFlow); the three most negative cap-weighted outflows came from NVDA, TSLA and NFLX; indeed, the outflow from NVDA was sufficient for it to lose top spot in the largest cap-weighted constituents (see too Valuations & Rankings). The best directional correlation amongst the five primary BEGOS Markets currently is positive between Gold and Oil. The Econ Baro awaits November’s Consumer Confidence and October’s New Home Sales. Also late in the session we’ve the FOMC Minutes from the 06-07 November meeting.

25 November 2024 – 08:32 Central Euro Time

All eight BEGOS Markets are at present outside of their respective Neutral Zones for today: above are the Bond, Euro, Swiss Franc, Copper and Spoo; below are Gold, Silver and Oil; session volatility is moderate-to-robust. Gold has already given back as much as 38% of last week’s +151 points gain: The Gold Update highlights Gold’s stellar week as nonetheless a contra-trend rally within the fresh weekly parabolic Short trend; key to assess this week shall be Wednesday’s PCE data for October; too, Gold is whipsawing ’round its smooth valuation line (see Market Values), today having crossed back below it. Well up thus far today is the Bond: we’d of late written our anticipation of a such a move, notably as the Bond’s “Baby Blues” (see Market Trends) have twice crossed above their -80% axis since 11 November. And Q3 Earnings Season concluded on Friday, the sub-par performance seeing 64% of S&P 500 constituents bettering their bottom lines over Q3 a year ago: the average such improvement since 2017 is 66%, and ex-COVID, 68%. The “live” (futs adj’d) P/E of the S&P is presently 44.9x.

The Gold Update: No. 784 – (23 November 2024) – “Gold’s Contra-Trend Rally; S&P’s Earnings(less) Tally”

The Gold Update by Mark Mead Baillie — 784th Edition — Monte-Carlo — 23 November 2024 (published each Saturday) — www.deMeadville.com

Gold’s Contra-Trend Rally; S&P’s Earnings(less) Tally

Let’s begin with Gold, courtesy of the “We Love It When We’re Wrong Dept.” given price having just recorded its best week (by net points gained) in nearly 45 years!

For following last week’s piece (“ ‘Tis No Surprise, Gold’s Current Demise “) replete with our “…suggesting Gold revisiting the upper 2400s on this run…”, Gold instead posted five consecutive up days toward settling yesterday (Friday) at 2718.  Not only was it a beautiful “thAng”, but it also lends credence to our time-honoured quip that “Shorting Gold is a bad idea”.

Still — speaking of Short — the week’s five-day rally was not sufficient to flip the fresh parabolic Short trend on Gold’s weekly bars back to Long per this next graphic.  Indeed to so do in the ensuing week, price would need eclipse the 2797 level as below shown.  ‘Course as we’ve stated of late, Gold’s prior three weekly parabolic Short trends lasted but three weeks apiece.  And as fresh as is the new Short trend, nonetheless, ‘twas a terrific week for the yellow metal.  Price’s net gain on a percentage basis of +5.9% was the best since that ending 17 March 2023 — and by the net gain of +151 points — ’twas Gold’s best week since the “Wonder Week” ending 18 January 1980 upon price gaining +195 points from 628 to 823 (+31%).  A lot of today’s financial “pros” weren’t around then (and it shows) … yet we were, (as too, for you Silver buffs,  were Nellie, Willy and Lamar Hunt … but we digress).   Here’s the year-over-year graphic:

How wonderful to have been wrong, indeed!  And yet — until the weekly parabolic trend whirls back up to Long — we’ve entitled this past week’s fabulous rise as a “contra-trend rally”, (which for you WestPalmBeachers down there means Gold is rising within a broader down trend).  To wit, this next two-panel graphic is gleaned from what we refer to as our best Market Rhythms.  On the left is Gold by the day since 22 October:  notice the MACD (moving average convergence divergence) has just crossed to positive.  On the right, however, is Gold by the week since 06 June:  therein (as we first presented last week) the MACD had just crossed to (and remains) negative.

“So which one is up, mmb?”

Well, Squire, ultimately both!  But for the present, the ensuing week brings the Federal Reserve’s so-called favourite gauge of inflation:  Core Personal Consumption Expenditures Prices for October.  And the consensus there is it continues to run “hot” at an annualized pace of +3.6% which obviously surpasses the Fed’s ongoing target for +2.0%.

Too, there’s nearly four weeks to go before the Open Market Committee’s next Policy Statement (18 December), prior to which we’ll get the U.S. Bureau of Labor Statistics’ read on November inflation at both the retail and wholesale levels.  And should those metrics not be benign, does the Fed, rather than again cut its Funds Rate, leave a lump of coal in our Christmas stocking?  That would likely be a Gold negative.

Still, from the contra-trend conflict comes the website’s updated Market Value chart for Gold from a year ago-to-date.  When last herein viewed a week ago, price had negatively crossed beneath its smooth valuation line (borne of price movement relative to the five primary BEGOS Markets, i.e. the Bond  Euro / Gold / Oil / S&P 500), the “rule of thumb” there to expect further price decline.  But from the “Hold Your Horses! Dept.”, price this past week reversed course upward to positively cross back above the smooth valuation line.  Nothing like seeing broadly undervalued Gold getting the bid!  Here’s the graphic:

“But why the sudden turnaround, mmb?”

Squire, for all the usual “conventional wisdom” reasons, depending upon one’s media source.  “Oh there’s geo-political tension favoring safe-haven Gold!”  “Oh Bitcoin is pulling Gold higher ’cause Trump’s gonna pair ’em!”  “Oh Goldman Sachs says Gold $3,000!”  We’ll stick with the foundational truth:  currency debasement, even as nothing moves in a straight line.  To be sure, 1,132,033 December Gold contracts were purchased last week … meaning 1,132,033 were sold.

Meanwhile, speaking of Bitcoin, its December futures contract hit an all-time high yesterday of $101,100.  Come 27 December is the contract’s expiry, which unlike Gold is settled financially rather than physically, (just in case you’re scoring at home and think you have to make delivery of Bitcoin).  “Hey Mabel!  I thought you said you stacked it up in the closet!”

Not scoring as well at present is the Economic Barometer.  This past week brought but eight metrics into the Baro, only three of which improved period-over-period.  Notable amongst the retreaters was the lagging indicator of the Conference Board’s Leading Indicators for October.  The negative reading was, of course, warmly greeted by the S&P, which then spent the balance of Thursday and Friday moving higher, “because the Fed has to cut, ya know.”  Yeah, we know.  “Got Gold?”  Here (featuring some old “friends”) is the Econ Baro along with the S&P 500 from one year ago-to-date:

And of course as has been our wont seemingly forever, the “live” price/earnings ratio of the S&P 500 remains hideously high, now 44.6x.  It stays in such silly territory because as the S&P trades higher, earnings don’t keep pace.

Indeed, Q3 Earnings Season just concluded.  Of the S&P’s 503 entities, 447 reported within the seven-week stint.  64% of the bottom lines bettered themselves over Q3 of a year ago … which means 36% did not … which makes us wonder why they’re even in the world’s wealthiest index … which brings us to the following graphic.

It covers the last 30 quarterly Earnings Season for the S&P.  The violet line is the percentage of companies beating the broker’s marketing tool known as “estimates“.  The green line is the percentage of companies that actually made more money, (an aspect seemingly taboo for the broker to reveal).  And as for the dashed green line, ’tis the evolving average of percentage improvement from the prior year’s like quarter.  That average today is 66%.  Exclude COVID year 2020 and the average is 68% … which is why we’ve been regularly characterizing this past Earnings Season as “sub-par” … which is why the high P/E refuses to die … which is why our title includes “The S&P’s Earnings(less) Tally”, indeed.  Take heed:

Take heed, too, over Gold’s contra-trend rally.  ‘Twould be statistically off the end of the Bell Curve for Gold to record a further consecutive weekly parabolic Short trend of just three weeks duration.  That noted, one cannot argue with the following two-panel display featuring Gold’s daily bars from three months ago-to-date on the left and 10-day Market Profile on the right.  Gold’s “Baby Blues” of linear regression trend consistency now curling upward without having quite reached down to their -80% axis is quite the bullish suggestion.  And per the Profile — atop which Gold sits — there are plenty of high-volume support prices as labeled:

Hardly as firm as that for Gold is the like picture for Silver.  Save for last Monday, her trading week at best was rather namby-pamby, albeit her “Baby Blues” (at left) piercing up through the -80% axis typically is a “buy” signal.  And per her Profile (at right) there is labeled volume support from 31.25 down to 30.75.  Further — as we relentlessly remind — Silver remains ever so cheap relative to Gold:  the century-to-date average Gold/Silver ratio is now 68.6x, whereas the actual ratio settled the week at 86.6x.  Thus with Gold at 2718, Silver by the ratio’s average “ought be” +26% higher at 39.64 rather than her actual present price of 31.41.  Again:  do not forget Sister Silver!

So into the StateSide Thanksgiving week we go:  11 metrics come due for the Econ Baro, including 10 packed into Monday through Wednesday, the PCE data surely to get the lion’s share of interest.

Moreover:  we’ve this heads-up for next Saturday’s edition of The Gold Update.  We shall be once again  “in motion”, this time through the treasured beauty of Tuscany.  Thus akin to the occasional “Gold in 60 Seconds”, next week’s piece shall be quite brief.  True, ’tis is a month-end edition, normally graphics-rich.  However, we’ll like save most of those for the ensuing 07 December missive.  Either way, Gold’s reaction to next Wednesday’s PCE shall be key.

As we thus prepare to embark for Golden Tuscany, ensure your tally totals a Golden Destiny!

Cheers!

  …m…

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

22 November 2024 – 08:32 Central Euro Time

Both Gold and Silver are at present above today’s Neutral Zones, whilst below same is Copper; the balance of the BEGOS Markets are calm, and session volatility remains light to this point. Gold has had a firm contra-trend rally this week even as the weekly parabolic trend just flipped from Long-to-Short a week ago: more of course in tomorrow’s 784th consecutive Saturday edition of The Gold Update. At Market Trends, the sole BEGOS component with a positive linreg is the Spoo. The S&P’s “textbook overbought” streak continues, the sub-par Q3 Earnings Season (which concludes today) in turn maintaining a stratospherically high “live” P/E of 45.4x (futs-adj’d for real-time). Bitcoin appears poised to tap 100,000 today, (high 99,820). And the Econ Baro concludes its quiet week with the monthly revision to November’s UofM Sentiment Survey.

21 November 2024 – 08:38 Central Euro Time

Both Gold and Silver are at present above their respective Neutral Zones for today, whilst below same is the Spoo; volatility is again light. Looking at Market Values in real-time for the five primary BEGOS Markets, we’ve the Bond as -1.50 points “low” vis-à-vis its smooth valuation line, the Euro -0.024 points “low”, Gold -16 points “low”, Oil -0.99 points “low” and the Spoo +131 points “high”. The S&P 500 is now 11 consecutive trading days “textbook overbought” and further is 26 days as such across the past 30. The “Baby Blues” (see Market Trends) for the Precious Metals are starting to curl upward, albeit their linregs remain well negative. And for the Econ Baro, incoming metrics include November’s Philly Fed Index, plus October’s Existing Home Sales and Leading (i.e. “Lagging”) Indicators.