Mark

The Gold Update: No.704 (13 May 2023) – Gold Comes a Bit Undone, but Silver’s Selling is Overdone!

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The Gold Update by Mark Mead Baillie — 704th Edition — Monte-Carlo — 13 May 2023 (published each Saturday) — www.deMeadville.com

“Gold Comes a Bit Undone, but Silver’s Selling is Overdone!“

 

A mere four weeks ago we penned our 700th missive entitled “Gold: The Next All-Time High is Nigh”.  And as you nauseatingly know from just prior to this past week, Gold came within four wee points of so doing in reaching 2085 on 04 May, (the All-Time High of course still 2089 from 07 August 2020).

Since however, our “Nigh” has gone somewhat awry, Gold having just recorded a wimpy week of net -9 points in settling  yesterday (Friday ) at 2016.  Regardless, from the 04 May high of 2085 to this past week’s low of 2006 was Gold’s coming a bit undone to the tune of -3.8% in less than seven trading days. 

But the more morose lowlight was the comprehensive shellacking of Silver, her selling overdone indeed!  And it all happened in just these last two trading days, Silver settling at 24.13 to close out her week.  ‘Twas quite untoward to take in:  for at Wednesday’s settle (25.63) the Gold/Silver ratio was 79.5x; 48 hours later ’twas 83.5x!  Such two-day increase of 4.0x hasn’t occurred in better than two years (since 03 February 2021)!  Moreover, from Thursday’s high to Friday’s low, Gold dropped -2.0% … but Silver was chopped liver at one point to the tune of -7.0%!  “Hold the onions!”  Behold the two-day percentage tracks for our metals’ triumvirate of Gold, Silver and Copper from this past Thursday through Friday (15-minute data):

 

Oh to be sure, Cousin Copper is somewhat the culprit here.  Just as Gold is money, we consider Silver as same.  But we’ve seen at times over the years our Sister Silver discard her precious metal pinstripes for her industrial metal jacket when on occasion Cousin Copper comes calling.  Yet clearly per the above graphic, let’s just say the white metal’s dalliance with the red metal this time ’round was rather excessive (understatement), whether measured by Copper’s percentage decline, Gold’s modest decline, and/or the Gold/Silver ratio itself.  So say it loud, say it proud:  “Got Silver?“  Further as is our wont to point out — given the century-to-date average Gold/Silver ratio of 67.5x — were Silver priced today by that metric, she’d be +19% higher than her current 24.13 at 29.86.  Reprise:  “Got Silver?“

As for the yellow metal, it recorded an “inside week”, (i.e. a “lower high” and “higher low”).  Not to get too deep into the statistical weeds as we turn to Gold’s weekly bars from one year ago-to-date, but you may find this tidbit of interest.  In reviewing the prior ten parabolic Long trends (from as far back as January 2018), upon Gold therein printing an “inside week”, price’s “median maximum” gain in the ten ensuing weeks was 64 points (which from here at 2016 would be 2080), and price’s “average maximum” gain in those same stints was 108 points (which from here at 2016 would be 2124).  Thus specific to that construct playing out, ’tis fair to still say that a new Gold All-Time High remains nigh.

And to that end, the current trend remains Gold’s friend.  As of course does currencies’ debasement.  Yes, ’tis true that from 1980-to-date the supply of Gold itself has increased +123% … but the supply of U.S. Dollars alone (“M2″ basis”) across those same 43 years has increased +1,198%.  That is 10x the supply increase of Gold.  “Got Gold?”  And conservatively taking the average price of Gold for the year 1979 (such as to avoid 1980’s Gold price spike) of 310: 10x that is 3100.  Reprise: “Got Gold?”  We do right here:

 

“When it all goes wrong” indeed.  How’s that avoidance of StateSide “debt default” working out?  So far ’tisn’t.  “There goes the credit rating…”

“But mmb, it says here: ‘The validity of the public debt of the United States … shall not be questioned.'”

Excellent, Squire, to see you’re keeping up with the 14th Amendment [Section 4].  Anything there about the validity of folks’ bank deposits?  How about the validity of stock prices given stratospheric price/earnings ratios?  Again bearing in mind Jerome Cohen’s writing “In a bear market many stocks will sell at 5 to 7 times earnings, while in bull markets the average level would be about 15 to 18 times earnings” we’ve this rip from the website’s Valuation and Rankings page for the S&P 500:

 

Then too we’ve the Economic Barometer which for the third consecutive week regained some ground.  In fact the only real stinker was Friday’s marked decline in the University of Michigan’s “Go Blue!” Sentiment Survey, its initial June reading falling fourth most since the April 2020 onset of COVID.  To be sure, when concern arises as to whether that ever-reliable U.S. Treasury Interest cheque shall arrive in the mail — or not — sentiment clearly sags.  ‘Course with our “live” P/E for the S&P itself at now 52.6x, alternatively one can cash out before it all goes wrong there as well:

 

Next let’s drill down (quite literally for Sister Silver) into the daily bars across the past three months-to-date with Gold on the left and with Silver on the right.  Fairly stark difference there, the rightmost couple of days for Silver versus Gold.  Did we mention Silver’s selling as being overdone?  Absolument!

 

Then too we’ve the 10-day Market Profiles for the yellow metal (below left) and the white metal (below right).  Whilst Gold rests just below trading resistance in the denoted 2020-2032 range, a swift Silver climb to her 25.85 line would be ever so sublime, for we anticipate ’tis just a matter of time before the precious metals further their shine:

In closing it out this time ’round, what with all the talk of StateSide “debt default”, this past week (as we’ve done over the years) we perused the Budget of the U.S. Government for Fiscal Year 2024.  If you’ve never so done, we encourage you to so do, especially if you pay federal tax.  Amongst the double-columned 185 pages and the many “Seriously?” items therein comes this allocation for the Office of Refugee Resettlement (ORR).  ‘Tis allocated $7.3B to help resettle up to 125,000 refugees in 2024 … which of course works out to $58,400/refugee.  That’s darn good dough if you can get it!  Better still:  get some Gold, and Silver too!

 

Cheers!

…m…

www.TheGoldUpdate.com
www.deMeadville.com

12 May 2023 – 09:26 Central Euro Time

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Oil is the BEGOS Markets’ weak link this morning, at present below its Neutral Zone for today; the balance of the bunch are within same, and volatility is light-to-moderate. Silver yesterday took its worse high-to-low points shellacking since 09 March 2022, the intraday move being -1.375 points (-5.7%); more in tomorrow’s edition of The Gold Update. By Market Rhythms, our most consistent (10-swing test basis) at present is the Swiss Franc’s 1hr. Moneyflow study, whilst per the 24-swing test basis ’tis Oil’s 2hr. MACD. The Econ Baro concludes the week’s inflation data with April’s Ex/Im Prices, plus the UofM Sentiment Survey.

11 May 2023 – 09:48 Central Euro Time

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The Euro, Swiss Franc, Silver and Copper are all at present below today’s Neutral Zones; above same is the Bond, and BEGOS Markets’ volatility is already moderate-to-robust, Copper notably having thus far traded 121% of its EDTR (see Market Ranges). At Market Trends, Copper’s linear regression appears as the most negative of the components. The Gold/Silver ratio at 80.4x is provisionally higher than ’tis been since 06 April. Our “live” P/E (futs-adj’d) for the S&P is 53.2x; the yield is 1.623% versus that of 5.065% for the U.S. 3-month T-Bill. Amongst today’s inputs for the Econ Baro is April’s PPI.

10 May 2023 – 11:17 Central Euro Time

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At present we’ve both Copper and Oil below their respective Neutral Zones for today, whilst above same is the Bond; BEGOS Markets’ volatility is yet again mostly light, the sole exception being Copper having traced 85% of its EDTR (see Market Ranges). Yesterday, the S&P 500 itself traded its narrowest points range (14) since the half-day session of last 25 November, and since the full-day session of 24 August 2021: we expect this puts emphasis on the inflation data reports over these next three days, (CPI today, PPI tomorrow, Ex/Im Prices on Friday). Awaiting the Econ Baro as well for today is April’s Treasury Budget.

09 May 2023 – 09:17 Central Euro Time

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Copper is the sole BEGOS Market at present outside (below) today’s Neutral Zone; otherwise, volatility is again mostly light. Of note for Market Rhythms, leading the pack for consistency (of the 405 studies tested per night) is the Bond’s 1hr MACD. We had quite the surprise in seeing the P/E for the S&P 500 leap to its present level of 78.7x; it now appears that was due to a data broadcaster error which is being assessed; regardless, the still high “live” level of 54.2x is validated by the low level of incoming Q1 Earnings even as share prices remain extraordinarily high: see too our S&P Valuation and Rankings page for the cap-weighted truth. Whilst nothing is due today for the Econ Baro, StateSide debt ceiling discussions are said to get underway today.

08 May 2023 – 09:08 Central Euro Time

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The Euro, Swiss Franc, Copper and Oil all are at present above their respective Neutral Zones for today; the balance of the BEGOS Markets are within same, and volatility is mostly light. The Gold Update graphically highlights the yellow metal’s near miss at making an All-Time High this past Thursday, but that price’s trend remains up such as to anticipate the threshold being broken as the current weekly parabolic Long trend continues to unfold. Oil, which traded as low as the 63s this past week, sees its price (now 72.08) nonetheless some 5 points below its smooth valuation line (see Market Values). The Econ Baro starts its week with March’s Wholesale Inventories.

The Gold Update: No.703 (06 May 2023) – Gold Nears Record Threshold … Then Gets Royally Rolled —

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The Gold Update by Mark Mead Baillie — 703rd Edition — Monte-Carlo — 06 May 2023 (published each Saturday) — www.deMeadville.com

“Gold Nears Record Threshold … Then Gets Royally Rolled“

And if you blinked — literally — you missed it.  In one of the most bizarre GLOBEX/COMEX session openings we’ve ever witnessed — that for this past Thursday, 04 May — Gold in mere seconds leapt 37 points from 2049 to 2085, just 4 points shy of the record threshold 2089 All-Time High … only to then get royally rolled into week’s end, settling yesterday (Friday) at 2025.

Thursday’s opening alone put us in mind of that 2000 Nicky Cage drive-in B-movie “Gone in 60 Seconds” as follows, emphasizing volume of 899 contracts upon some “entity” instantaneously hoovering away 13 full points of overhead offers in just one second!  Here ’tis:

‘Course, upon Gold not reaching its record high threshold, price then got rolled — and quite royally so — come Friday’s Bureau of Labor Statistics Payrolls data for April coming in 41% (+253k) more plentiful than “expected” (+180k); [note: our own inhouse estimate was for +250k… but the “Pros” are far more informed than are we, right?]

Oh to be sure, the yellow metal did record an up week.  BUT:  from its high-to-settle ’twas Gold’s second-worst intra-week drop year-to-date (-60 points or -2.9%).

And whilst that “one-second wonder trade” may warily reek of an MSC (“Manipulative Short Clearout”), if not even an honest attempt to go for Gold’s All-Time High it being so nigh, hardly was the effort sustainable.  The firm Labor report (plus as we’ll herein see the Economic Barometer’s recent recovery) almost certainly suggests the Federal Reserve is not set to “pause” come their Open Market Committee’s next Policy Statement (due 14 June).

And why pause at all?  After all, as we a week ago saw, the Q1 Chain Deflator component (+4.0%) of Q1 Gross Domestic Product (+1.1%) basically means 80% of quarterly GDP “growth” was solely inflationary rather than real.  Hence this opening sentence from Wednesday’s FOMC Statement:  “Economic activity expanded at a modest pace in the first quarter.”  Given that +1.1%, we can concur.  But then came the opening sentence of paragraph two:  “The U.S. banking system is sound and resilient.”  Cue one John Patrick McEnroe:  “You canNOT be SERious!”

Regardless, Gold “expectedly” got creamed upon Labor’s strong jobs release as the rightmost weekly bar next shows.  Yet the blue-dotted parabolic Long trend remains well intact, now 8 weeks in duration.  And as you sharp-eyed regular readers already know, the average duration of the past ten such trends is 14 weeks, typically carrying enough average points follow-through to imply (within that vacuum) Gold reaching the mid-2100s on this run.  You tell ’em, Charles, as here’s the graphic: 

We mentioned the Econ Baro:  here we go.  Of the Baro’s 14 incoming metrics this past week, 11 of them were period-over-period improvements, including April’s Payrolls creation both per Labor and ADP, the Unemployment Rate, Hourly Earnings, and the Institute for Supply Management’s Indices for both Manufacturing and Services.  Too for March came growth in Construction Spending, Factory Orders, Consumer Credit and a reduction in the Trade Deficit.  Yes, the groaner therein was our first peek at Q1’s Productivity which shrank whilst Unit Labor Costs rose.  But on balance, a bodacious week for the Baro, indeed its best five-day stint since that ending 08 February.  “Slow that thing down!”

And how about that S&P 500 on Friday scoring its third-best points gain (+75 or +1.8%) year-to-date?  Further:  did you know that 60.3% of that gain (via capitalization-weighted moneyflow) was from Apple (AAPL) alone, the Q1 earnings for which were flat at that from Q1 a year ago (again $1.52/share) whilst revenue dropped -2.5%?  (This is why we don’t “do” stocks:  far too nonsensical).  Oh and lest we forget, our “live” price/earnings ratio for the S&P settled the week at 54.2x.  Too, (should you still be scoring at home), the market capitalization of S&P is now 73% greater (at $36.0T) than the U.S. liquid money supply (at $20.7T “M2” basis).  But wait there’s more:  as we avoid watching them, are the FinTv channels running a StateSide Default Countdown Clock?  Indeed in so many ways “…tick tick tick goes the clock clock clock…”

Regardless, ticking down into week’s end were our precious metals. From high-to-low for Friday alone, Gold fell -2.6% and Silver -3.9%, both paying the freight when suddenly everything else is deemed just great as our two ol’ stock market buddies elate:

Thus to drill down into the precious metals we’ve first our 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.  ‘Tis rare that the “Baby Blues” go that askew, but price’s sudden up-and-down has affected consistency in this view.  More importantly, whether by the aforeshown weekly view or this one, the dominant Gold trend remains up.  Meanwhile per the Profile, we look to the denoted trading support in the high 1900s as sufficient:

Silver’s similar view actually appears more stable.  She too got somewhat sucked into Gold’s “spike n’ roll”.  However week-over-week, Silver’s net gain was +2.3% versus Gold’s +1.3%.  Indeed, the Gold/Silver ratio is now 78.1x, its lowest reading since this past 06 January, (albeit priced at the century-to-date average of 67.5x would find Silver today at 30.01 versus her Friday settle at 25.93).  Still, her Profile’s low 25s suggest trading support:

“By the way, mmb, do you know what you’ve not yet posted this year?”

What might that be, Squire?

“The Gold Stack.”

Super scrutineering there, Squire!  Haven’t so done since last 26 November, Gold then at 1755.  Thus without further ado, here ’tis:

Remerciements, cher Inspecteur.  Now peering into the ensuing week we’ve the monthly round of both retail and wholesale inflation data.  The Consumer Price Index is “expected” to have increased from March’s +0.1% pace to +0.4% for April; and for the Producer Price Index from -0.5% to +0.3%.  How’s that erosion of purchasing power workin’ out for ya?  ‘Tis a good time to grab some more Gold!

Cheers!

…m…

www.TheGoldUpdate.com
www.deMeadville.com

05 May 2023 – 09:20 Central Euro Time

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Both the Euro and Oil are at present above today’s Neutral Zones; below same is the Swiss Franc, and BEGOS Markets’ volatility is mostly light with April’s StateSide Payrolls data in the balance. Gold (2054) has remained fairly docile following yesterday’s spike to nearly an All-Time High, (more on that in tomorrow’s edition of The Gold Update). Our “live” P/E for the S&P 500 continues to reside in the stratosphere at 52.5x, reflective of a stagnant Q1 Earnings Season; the Index’s yield is 1.653% versus the U.S. 3-month T-Bill yield of 5.055%. Due too to close out the Econ Baro’s week is Consumer Credit for March.

04 May 2023 – 09:17 Central Euro Time

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Following the anticipated FOMC’s +25bp FedFunds increase, Gold made a significant gain at this session’s open up to 2085 on a very high-volume trade, to just 4 points shy of the 2089 All-Time High; however, ’tis all since been hoovered away, price now 2044, within today’s Neutral Zone. Above same are Copper and Oil, whilst below same is the Bond; BEGOS Markets’ volatility is nonetheless moderate-to-robust with Gold, Copper and Oil already having traded in excess of 100% of their respective EDTRs for today (see Market Ranges). Oil tested the key prior low (64.12) of 20 March, reaching down to 63.64 before then bouncing to as high as 69.42 thus far today. With nine metrics due for the Econ Baro in these next two sessions, those for today include March’s Trade Deficit, plus Q1’s Productivity and Unit Labor Costs.

03 May 2023 – 10:05 Central Euro Time

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New bank struggles boffed the S&P by -1.2% yesterday; however at present, the Spoo is marginally higher, plus the Bond, Euro and Swiss Franc are above their Neutral Zones; below same is Oil, and session volatility is mostly mild ahead of today’s FOMC +25bp rate rise (due at 18:00 GMT). Yesterday’s S&P MoneyFlow was only about a third as weak as the Index itself, evidence of the selling not being materially fear-based. Gold’s high yesterday (2029) was 60 points away from its All-Time High (2089), price reaching its best level since 14 April. Ahead of the Fed, the Econ Baro looks to April’s ADP Employment data and the ISM (Svc) Index.

02 May 2023 – 09:41 Central Euro Time

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With the StateSide debt ceiling coming to a head, we’ve the Bond and Spoo at present above their respective Neutral Zones for today; SiIver is below same, and overall BEGOS Markets volatility is again light. As Q1 Earnings Season weakens along, our “live” P/E of the S&P has now moved up to 52.1x. Still, by Market Values, none of the primary BEGOS components are at extreme deviations from their smooth valuation lines. Also by Market Magnets, we’ve no notable deviations at present. Today brings March’s Factory Orders for today’s Econ Baro.

01 May 2023 – 09:23 Central Euro Time

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The Bond begins the week at present below its Neutral Zone for today, as do Gold, Copper and Oil; the balance of the BEGOS Markets are within same, and volatility is light. The Gold Update displays the yellow metal as the BEGOS Markets’ leader year-to-date, followed by the S&P 500 and the Bond. We still see Gold eclipsing its All-Time High (2089) within the duration of the current weekly parabolic Long trend, should typical price follow-through again occur; too, the Gold Update cites a visual plethora of warning signs for the S&P 500. For Market Rhythms, the best consistency from our 10-swing test basis is Copper’s 6-hr. Moneyflow, whereas on a 24-swing test basis ’tis Oil’s 2-hr. MACD. The Econ Baro starts a very busy week with April’s ISM(Mfg) Index and March’s Construction Spending; Wednesday the FOMC votes to raise FedFunds another 0.25bp and today on this side of the pond bourses are closed for the 01 May holiday.

The Gold Update: No.702 (29 April 2023) – Gold Our Best Vertex; S&P Train Wrecks

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The Gold Update by Mark Mead Baillie — 702st Edition — Monte-Carlo — 29 April 2023 (published each Saturday) — www.deMeadville.com

“Gold Our Best Vertex; S&P Train Wrecks“

We’ve completed the year’s first trading quadrimestre (a little French lingo there).  And just as we saw at March’s month-end, so too through April is Gold again sporting the highest year-to-date percentage BEGOS Markets vertex as the “The Leader of the Pack” –[The Shangri-Las, ’64]:

And contrary to conventional wisdom that Gold and the stock market are inversely correlated, barely off the pace is the S&P 500 in second place, with the reportedly “left for dead” U.S. 30-year Treasury Bond rounding out the podium.

Still, specific to the yellow metal through these last three missives inclusive, we continue to anticipate a new Gold All-Time High as nigh — albeit having fully expected en route some near-term retrenchment into the 1900s — which has been exactly the case thus far.  (Note that per reader requests, recent editions of The Gold Update are now being archived on the website, such that you can look back to see what we’ve said).

To be sure, in yesterday’s (Friday’s) settling of the week, (and month and quadrimestre) at “1999” –[Prince, ’82], ’tis but a 90-point sprint to the present All-Time High (of 2089 back on 07 August 2020), which as herein detailed a week ago can happen in a heartbeat.

But in looking ahead toward Gold’s inevitably passing up through 2089, again we’re anticipating the mid-2100s come this July, given typical price gains during parabolic Long trends.  The current one is represented by the rightmost ascending blue dots across Gold’s weekly bars from one year ago to date, (with the flip for the ensuing week still well out of range down there at 1890): 

Now as we turn to “The Gold Leverage Dept.” as well from one year ago to date, Gold itself has the best performance track of the whole bunch.  Thus is Gold too far ahead of the pack?  Hardly, given today’s 1999 being but 53% of the opening Scoreboard’s debasement valuation of 3746.  Rather, we see Gold’s equities brethren having a lot of catching up to do.  At present, their year-over-year percentage tracks with Gold +6% are Agnico Eagle Mines (AEM) +3%, Franco-Nevada (FNV) +1%, the VanEck Vectors Gold Miners exchange-traded fund (GDX) -3%, the Global X Silver Miners exchange-traded fund (SIL) -9%, Pan American Silver (PAAS) -27%, and S&P 500 constituent Newmont (NEM) -34%.  Livin’ for leverage?  Lovin’ these laggards!

But it depends from where you measure, right mmb?

An absolutely valid point there, Squire.  For example, if measuring from the Opening Bell that began the year 2016 when Gold & Co. were deep in the dumper, almost all of these cited equities have outpaced Gold.  Since then:  FNV is +227%, PAAS is +167%, NEM is +157%, GDX is +138%, AEM is +110%, Gold itself is +88%, and the lone underperformer is SIL +58%.  Regardless, ’tis time for the equites to again get on the go, the ideal catalyst being upon Gold eclipsing 2089 for a new All-Time High.  Then watch ’em really go!

And speaking of stocks in general, to again reprise the late great football coaching legend Vince Lombardi:  “What the hell’s goin’ on out there?!?!?”  After all, our missive’s title for this week includes “S&P Train Wrecks” of which we’ve selected several to inspect.  In fact, let’s present them as follows in a form most picturesque:

Talk about taking the wrong track … yet the stock market per our preferred measure of the S&P 500 (currently 4169) refuses to revert to rational valuation (sub-3000, at least).  Indeed as Q1 Earnings Season continues to unfold, of the 249 constituents having reported, a full 40% have posted worse bottom lines than for Q1 of a year ago.  Is it any wonder our “live” price/earnings ratio for the S&P remains in rarefied air at 47.8x up there?  Recall Jerome Cohen’s writing that “…in bull markets the average level would be about 15 to 18 times earnings…”  Still in today’s S&P there are 28 constituents with P/Es of 100x or greater … and hardly is this even a “bull market”.  Let’s cue Dire Straits from back in ’85 with “Why Worry?”  After all, have a gander at the Economic Barometer:

Indeed the Baro’s “low-light” for the week was Q1’s shrinkage in annualized real Gross Domestic Product growth to just +1.0%.  Too, The Conference Board’s April reading on Consumer Confidence stumbled as did both March’s Personal Spending and Pending Home Sales.  But there were a few bright spots to give the Baro a bit of a lift, notably from the Chicago Purchasing Managers’ Index leap for April along with March’s Durable Orders and New Home Sales; also, Initial Jobless Claims subsided.  But on balance across the breadth of the Baro, the economy at best is shaky and faltering.

Faltering too of late are the BEGOS Markets as next we go ’round the horn for all eight components across their daily bars for the past 21-trading days (one month).  Note that in every case, the baby blue dots of regression trend consistency are in decline; moreover, just seven trading days ago, each market’s grey trendline was positive, four having since rotated to negative.  And specific to the S&P 500 (lower left panel) we sense that rightmost spike is a one-time wondershot:  in our book, just because a slowing economy suggests a Federal reserve “pivot”, ’tis poor judgement to knee-jerk purchase equities without regard to extreme overvaluation; and at the end of the day, earnings beating “estimates” doesn’t cover the reality of earnings in decline, (again as is the case this Earnings Season for 40% of the S&P’s constituents).   Here’s the graphic:

Next we turn to the 10-day Market Profiles for the precious metals.  And for both Gold on the left and for Silver on the right, present price (the respective white line in each panel) is poised mid-profile, both near if not at their most heavily traded prices as labeled for the past two weeks.  Perhaps a re-gripping to go for Gold’s high:

Thus toward wrapping it up with one-third of 2023 in the books, here we’ve Gold’s stratified structure by price’s monthly bars from the year 2011-to-date.  Dare we say:  “Here’s Johnny…” reminding us that a new All-Time Gold High is nigh:

So into this year’s second quadrimestre we go.  With the StateSide debt ceiling rising (but dead on arriving?), banks not surviving, Wednesday’s Fed hike reviving and the ensuing week’s 14 incoming Econ Baro metrics (to resume diving?), in whose car do YOU prefer to be driving?  That of GOLD!  The Leader of the Pack!

Cheers!

…m…

www.TheGoldUpdate.com
www.deMeadville.com

28 April 2023 – 09:22 Central Euro Time

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Following yesterday’s relief rally, the Spoo at present is below its Neutral Zone for today; the balance of the BEGOS Markets are within same, and volatility is pushing toward moderate; (of note, the Yen [not as yet in the BEGOS complex] has traced 212% of its EDTR following the BOJ’s steady policy statement). The “live” P/E (futs-adj’d) of the S&P 500 is 48.3x: thus far in Q1 earnings season with 242 constituents having reported, a full 42% have not bettered their bottom lines from a year ago; the Spoo (currently 4144) shows dominant Market Profile trading resistance at 4155; mind too the ongoing descent of the Spoo’s “Baby Blues” at Market Trends as its linear regression looks to be rotating toward negative into next week. Following yesterday’s slowing in reported Q1 GDP, the Econ Baro today awaits to April’s Chicago PMI and revised UofM Sentiment Survey, March’s Personal Income/Spending and Fed-favoured Core PCI Prices, plus Q1’s Employment Cost Index.

27 April 2023 – 09:45 Central Euro Time

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Gold and Silver remain resilient even in the face of weakening near-term technicals (as previously cited); both precious metals are at present above today’s Neutral Zones; the balance of the BEGOS Markets are within same, and volatility is mostly light, save for Copper which has already traced 75% of its EDTR (see Market Ranges). Silver’s cac volume is rolling from May into July, (as did that Copper on Tuesday). By Market Profiles, Silver has a trading resistance band from 25.35 up to 25.60, (current price right at 25.35); and by Market Trends, Silver’s “Baby Blues” continue to accelerate lower, as do those for Gold, Copper, Oil and the Spoo. ‘Tis a key day for the Econ Baro as we get our first peek at Q1 GDP; in today’s mix as well are March’s Pending Home Sales.

26 April 2023 – 09:20 Central Euro Time

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We’ve the Euro, Swiss Franc, Copper and Oil all at present above their respective Neutral Zones for today; none of the other BEGOS Markets are below same, and volatility is (for this time of the session) again light-to-moderate. Yesterday, the S&P 500 stemmed a 17-session streak of being “textbook overbought”, the Spoo itself reaching below its “low if a down day” for just the second time in better than a month; at Market Trends, the Spoo’s “Baby Blues” are accelerating lower; at Market Values, the Spoo has only just pieced its smooth valuation line to the downside as, too, it has just done through its Market Magnet; and the Spoo’s lows of three weeks ago have now been penetrated; thus still lower Spoo levels ought be in the offing from here. (‘Course more broadly, our notion for the S&P reaching sub-3000 makes sense given lower earnings and higher interest rates). The Econ Baro awaits March’s Durable Orders.

The Gold Update: No.701 (22 April 2023) – A Time to Add to One’s Gold Stack; (for the S&P, Prepare Hard Hat)

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The Gold Update by Mark Mead Baillie — 701st Edition — Monte-Carlo — 22 April 2023 (published each Saturday) — www.deMeadville.com

“A Time to Add to One’s Gold Stack; (for the S&P, Prepare Hard Hat)“

Yes, per last week’s 700th missive, an All-Time High for Gold remains nigh, (i.e. above 2089).  Yet en route to said notion of nigh, we also penned our expectation for Gold to first recede into the 1900s, price indeed having traded this past week to as low as 1981 before settling yesterday (Friday) at 1994.

Nonetheless with respect to a new Gold high being nigh, might price still a bit further slide?  After all, per The Oxford English Dictionary (circa 1879 as The New English Dictionary) “nigh” is simply defined as “near”.  And contextually, “near” is not that far from here.  Or numerically, 2089 is not that far from 1994, i.e. +95 points.

‘Course ’tis always about “The When”.  In round numbers, let’s say Gold basically from here has to pop up +100 points to eclipse its existing All-Time High.  Can that happen quickly?  Historically since 2001, there have been 25 mutually-exclusive (for you WestPalmBeachers down there that means “non-overlapping”) occurrences wherein Gold has gained better than +100 points within just five trading days, the most recent case being in just three sessions from 1815 on 09 March to 1920 on 13 March.   “You can bank on that.”  (Ouch).

But in terms of Gold’s present ranginess, our EWTR (“expected weekly trading range”) is now 63 points; thus solely by that metric, a new All-Time High above 2089 in a week’s time is a bit of a stretch.  Moreover, we’ve the following near-term technical concern.

Recall a week ago our “continuing coverage” of Gold having significantly deviated above its smooth BEGOS valuation line.  Here they are paired in the upper panel from one year ago-to-date:

The lower panel is the oscillator (price less valuation), at one recent point showing price as better than 150 points too high.  Thus as anticipated, price this past week came back to this near-term method of valuation.  However, upon price penetrating to close below valuation as just occurred yesterday, the “rule of thumb” is to expect still lower levels.  Such negative penetrations have happened six times since a year ago to an average downside deviation of -77 points … which from here at 1994 “suggests” 1917, (just in case you’re scoring at home).  But:  our sense is — in staying with the theme that a new Gold All-Time High is nigh — we’re not anticipating much material downside.  Rather, some of the levels we noted a week ago (such as 1953 and 1975) seem more reasonable, especially given our perception of Gold awareness being on the increase amongst the non-Gold crowd.

Moreover, as we turn to Gold’s weekly bars from one year ago-to-date, the blue-dotted parabolic Long trend continues to ascend such that we continue to seek the new All-Time High along this bend, leading further toward the mid-2100s before reaching an end:

‘Course, there’d be no market for Gold were it not for “The Other Side of the Trade Dept.” represented just yesterday in Barron’s by one “AA” (and you know who you are out there) who penned “Gold is Hitting a Wall” such that the 2050-2075 zone somehow is “formidable resistance”.   From our purview, such “resistance” is really the two tops formed first ’round COVID in 2020 and second ’round RUS/UKR in 2022 … and now thrice ’round Common Sense/Fundamental Undervaluation (per our opening Scoreboard level of Gold 3793).  Thus we still see a wee dip … but then up with it.  ‘Tis a time to add to one’s Gold stack.  For as we’ve quipped of late quite a bit:  “Triple tops are meant to be broken.”

Indeed speaking of “broken”, surely you’ve been following the daily track of the Economic Barometer.  ‘Twasn’t the busiest of weeks for the Baro, but it did take in eight material metrics, six of which worsened period-over-period, those being April’s Philly Fed Index, March’s Housing Starts, Building Permits, Existing Home Sales and Leading (or “lagging” as they’re already incorporated into the Baro) Indicators, plus the second highest level of weekly Initial Jobless Claims since last August.  The only two improvements were a one pip increase in April’s National Association of Home Builders Index, plus the month’s New York State Empire Index having turned positive for the first time since last November, (although just its fifth positive reading of the past 16 months).  Toward tying it all up (or better stated down) with a bow, the Econ Baro nearly touched a one-year low:

Such “El Plungo” by the Baro obviously elicits the “R” word.  Recall the back-to-back StateSide negative Gross Domestic Product readings for Q1 and Q2 of 2022 as having “defined” a recession … which was met with a rising Q3 and Q4, (i.e. per the lowly convention wisdom level, “the recession ended as soon as it started”).  And now come this Thursday (27 April) we’ve the first peek at Q1 GDP, consensus calling for +2.0% annualized growth, albeit weaker than the prior two quarterly readings respectively of +3.2% (Q3) and then +2.6% (Q4).  “Slip Slidin’ Away” –[Paul Simon, ’77]

“But don’t you ever get skepitcal of the reported numbers, mmb?”

At times, ’tis hard not to, Squire, albeit, the Econ Baro over its 25 calendar years has been on balance a magnificent precursor to such reports as the GDP, Leading Indicators, at alia.  But skepticism is a natural reaction at times, a most glaring example being the Baro’s significant decline through much of last year’s Q4 metrics … but then +2.6% GDP growth was “reported”.  One’s eyebrow thus is on occasion raised, but the bottom line is our maintaining the consistency in calculating the Baro all these many years.  Still if the “reported” metrics via our sources are fudged, ’tis a bold disservice to us all.

Indeed speaking of “disservice”, the broadest one upon which we perennially harp is the disingenuous math used at large to dumb-down the price/earnings ratio of the S&P 500.  Research it via the internet, and the number (22.1x) is less than half that of our “live” 47.9x.  (We’ve herein posted the formula a bazillion times — but that which was dutifully taught in B-school is irrelevant today — for at any cost do not let The Truth scare investors away).

And with respect to Earnings, the Q1 Season is well underway.  How are we doing? Fairly poorly, one has to say.  Thus far, some 72 S&P 500 constituents have reported, of which just 56% (40) bettered their bottom lines from a year ago.  Going back 24 quarters (six years), that 56% (thus far) ranks fifth-worst … and if we eliminate the four COVID quarters of 2020, today’s Q1 ranks second-worst.  And yet the S&P (now 4133) remains stratospherically up there in goo-goo land.  ‘Tis nothing short of extraordinary. (Oooh… “short”…)

Time was when lousy earnings were fundamentally weak for the S&P.  And now technically? (Prepare hard hat):  by the website’s Market Trends page, the S&P Futures’ “Baby Blues” measure just confirmed dropping below the +80% axis (a highly reliable precedent to lower prices); by the MoneyFlow page ’tis running out of puff; the daily Parabolics on the Futures just flipped to Short; the MACD likely crosses to negative come Monday’s settle; and the “textbook technicals” just completed their 16th trading day as “overbought”.  Thus for the S&P’s ensuing week or longer, can you say “Down”?  ‘Tis our sense.

And again, our immediate sense too for the precious metals is a wee bit lower.  Yet by our title we imply a chance to buy given the All-Time High being nigh.  First to Gold and our two-panel graphic of price’s daily bars from three months ago-to-date on the left and 10-day Market Profile on the right.  For the bars we’ve put in an arbitrary green box encompassing a reasonable support area for Gold, even as the declining “Baby Blues” of trend consistency become less so.  As for the Profile, what had been notable overhead resistance at 2039 has since shifted lower to the now-dominant 2017 level:

Second with the same graphical drill for Silver, her Baby Blues (below left) are poised to cross below that key +80% axis, suggestive of a price run down into the lower 24s. And in her Profile (below right), those denoted lower 25s now show as trading resistance:

‘Course all that said, we’ve this from the “Who’s Next? Dept.” Upon whichever bank next suddenly zooms to the above-the-fold newspaper position shall swiftly send the precious metals back on the upside track, in turn putting the S&P flat on its back.  Not that Gold nor Silver need that to happen:  the yellow metal (1994) again by the Scoreboard valuation (3793) is presently priced at but 53% that, whilst the S&P 500 by earnings-to-historical value is arguably more than double that.

We’ll thus wrap it for this week with one of our (again updated) all-time favourite Gold Update graphics toward the next All-Time Gold High being nigh!

Cheers!

…m…

www.TheGoldUpdate.com
www.deMeadville.com

The Gold Update: No.700 (15 April 2023) – Gold: The Next All-Time High is Nigh

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The Gold Update by Mark Mead Baillie — 700th Edition — Monte-Carlo — 15 April 2023 (published each Saturday) — www.deMeadville.com

“Gold:  The Next All-Time High is Nigh“

When we penned the first edition of the Gold Update 699 Saturdays ago on 21 November 2009 — for whom the sole recipient was one JGS (thank you, mate) — the price of Gold was 1151.  Since then, Gold rose to as high as 2089 (+81%) on 07 August 2020, nearly reclaiming that level at 2079 on 08 March 2022 as the RUS/UKR war intensified, and nearly again just this past Thursday at 2063.

But as is Gold’s wont to weaken following geo-political boosts, (the latest being upon Finland’s joining NATO as we detailed a week ago), plus some degree of waning inflation as reported this past week at March’s wholesale, retail and import price paces, the yellow metal, too, sank into week’s end, settling yesterday (Friday) at 2018.

Stirring Gold’s price negativity as well was FedGov Christopher “Up The” Waller’s commenting on Friday from the Lone Star State that inflation “…is still much too high … so monetary policy needs to be tightened further…” Or to reprise Al Gore’s infamous comment from back on the campaign trail in ’92:  “…Everything that ought to be down is up.  Everything that should be up is down…”

And priced today at 53% of the opening Scoreboard’s debasement value of 3797, Gold ought be up, whilst conversely with the “live” price/earnings ratio at 208% (46.9x) of its lifetime mean of 22.5x times, the S&P 500 ought be down.  (Pssst:  Can you say “means regression”?)  Or perhaps it all “means recession”?  More on that eventuality when we get to the Economic Barometer.

But first as entitled, for Gold the next All-Time High is nigh.  And as we turn to Gold’s weekly bars from one year ago-to-date, the rightmost blue-dotted parabolic Long trend is now five weeks in duration and accelerating upward.  Whilst price closed mildly lower (-0.3%) for the week just past, its high of 2063 was the best since that ending 11 March 2022, indeed just 26 points below the 2089 All-Time High.  As noted a week ago, we mused were Gold to achieve a new All-Time High coincident with this 700th missive would be brilliant.  Nonetheless, we anticipate price’s breaking above 2089 remains on the table during the course of this parabolic Long trend.  From here at 2018 to 2089 is a span of 71 points:  Gold’s “expected weekly trading range” is 64 points; thus in that vacuum, eclipsing 2089 in the new week is a bit out of range.  As well, Gold’s most recent week scored a “higher high”, but a “lower close”:  since Gold’s establishing the 2089 All-Time High 140 weeks ago, 24 of those have been down weeks incorporating a “higher high”.  The average fallout in those cases within the ensuing four weeks is some -65 points, which from today’s 2018 “suggests” 1953, a level not distant from the 02 February dominant high of 1975. Thus we ought not be surprised should Gold retrench a bit into the 1900s, which themselves are structurally supportive and of course well above the current parabolic flip price of 1858:

And by our valuing Gold vis-à-vis its smooth BEGOS line, price is some +59 points “high” per the oscillator in the lower panel of the following graphic; indeed the mid-point between “price” and “value” is at present 1988.  So again, a bit more pullback would not be untoward in Gold’s broader drive to a new All-Time High:

And speaking of broader, let’s next review our chart of Gold’s daily closes along with price’s 300-day moving average since the 1900 level was first achieved on 22 August 2011  ‘Twas back then when we specifically wrote of Gold having “gotten ahead of itself”.  ‘Course the ensuing fallout was far more than we’d anticipated, price fortunately having since recovered in full.  And forward from 2020, there’s that “triple top” which within trader hypotheses is “meant to be broken”, albeit more immediately Gold’s price appears some stretched above the blue average:

“But Gold is garnering more interest these days, right mmb?  And congrats on No. 700 by the way…”

Squire, we couldn’t have done it without you:  our thanks is beyond words.  And you are spot on.  For as pointed out in recent missives, today we hear more Gold buzz from non-Gold owners than since we began The Gold Update.  “Where is Gold?  How can I buy it?  Is it too late?”  Recall the late, great Richard Russell:  “There’s never a bad time to buy Gold.”  To which we add our 2¢:  the time to consider selling some is when everybody wants it (and ’tis trading up in the five-digits).

Speaking of trading up, one wonders when the S&P 500 shall revert to reasonable valuation, (which given the aforementioned P/E and assuming no growth in the “E” calls for a “correction” in the “P” of -52% … that shan’t be on CNBS, Bloomy nor Foxy).  As we oft quip:  “Others parrot; we do the math.”  And that includes doing the math for the Econ Baro, which in its present state relative to the stock market asserts that bad news is good:

The Baro this past week accounted for 14 incoming metrics of which 10 were worse period-over-period.  The only positives of note came in sentiment courtesy of the University of Michigan’s “Go Blue!” survey, plus improvements for Industrial Production and Capacity Utilization.  But with March’s Retail Sales again shrinking and (assuming you neither eat nor drive) core retail inflation down a pip but still running at nearly a 5% annualized rate, along with backups in both Wholesale and Business Inventories for February, the Baro on balance further eroded. Again, “means recession”?

Hardly eroding having been the price tracks of the precious metals.  For even if some normal retrenchment is in the near-term offing, ’tis hard to argue with the following two-panel display featuring the daily bars across the past three months-to-date for Gold on the left and for Silver on the right.  However, Gold’s baby blue dots of regression trend consistency have slipped below their +80% axis, another sign of pending corrective activity.  And should it be so, surely Sister Silver shall shiver:

And thus to the 10-day Market Profiles for Gold (below left) and for Silver (below right).  For both metals, price clearly has come off the respective highs recorded in the latter part of this past week.  Again as noted a week ago for Gold, there’s that 2039 apex — which indeed was well penetrated to the upside — only to return to now being resistive.  As for Sister Silver, ’tis all about holding above 25, albeit the 24s would now seem in store:

To sum it up for No. 700, our precious metals have had a significant run of late.  From Gold’s year-to-date low of 1811 on 28 February, today at 2018 ’tis +11%.  Similarly for Silver, her year-to-date low was just back on 10 March at 19.95 and today at 25.47 she’s +28% higher:  that’s in just 25 trading days! Brava Sister Silver!  To be sure some lower prices may ensue, but hardly do we believe these rallies are through.

Finally:  our heartfelt BRAVO to all of YOU who across these many years have seen us through.  From our direct readership to our re-publishers and those that further disseminate our missives, many, many thanks.  On to No. 701 … and may Gold stay Bold as the next All-Time High is nigh!

Cheers!

…m…

www.TheGoldUpdate.com

www.deMeadville.com

25 April 2023 – 09:21 Central Euro Time

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Both the Bond and Gold are at present above today’s Neutral Zones; below same are Copper and the Spoo, and BEGOS Markets’ volatility is again light-to-moderate. Neither Gold nor Silver have yet to retrench further as we anticipate still they will ahead of the next surge to an All-Time High (above 2089): indeed, Silver’s “Baby Blues” (see Market Trends) confirmed settling yesterday below their +80% axis, indicative of lower price levels. For the S&P 500, our MoneyFlow page shows further deterioration both by the weekly and monthly measures; our “live” P/E (futs-adj’d) is 47.5x. The Econ Baro gets its week going with April’s Consumer Confidence and March’s New Home Sales.

24 April 2023 – 09:14 Central Euro Time

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The Bond begins the week at present above today’s Neutral Zone; Silver, Oil and the Spoo are below same, and BEGOS Markets’ volatility is light-to-moderate. The Gold Update anticipates a new All-Time High is nigh, but that some minor downside play out prior to the next leap higher; by Market Values, Gold finally closed its upside deviation, and in penetrating the smooth valuation line, that’s a notion for a bit further weakness. Of greater concern is the ongoing overvaluation of the S&P 500 along with key Spoo technicals now in the process of crossing to negative. Moreover at Market Trends, the “Baby Blues” are falling for every component except the Euro and Swiss Franc. The Econ Baro — at nearly a one-year low — is quiet today ahead of an otherwise fairly busy week.

21 April 2023 – 09:20 Central Euro Time

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Except for the Bond and the Spoo, the six other BEGOS Markets are at present below their respective Neutral Zones for today; volatility is light-to-moderate. The S&P 500’s MoneyFlow was materially affected yesterday by the fall in shares of TSLA, reminding us of the days when AAPL seemed to be the entirety of the S&P, one stock driving the bus. Still, by “textbook technicals”, the S&P is “overbought” for a 15th consecutive session (three weeks), albeit the Spoo’s daily MACD is now poised for a negative cross. Too, yesterday’s incoming metrics for the Econ Baro were notably negative, nearly driving the Baro to its lowest oscillative level in a year; (more in tomorrow’s edition of The Gold Update).

20 April 2023 – 09:15 Central Euro Time

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Both the Bond and Swiss Franc are at present above today’s Neutral Zones; below same is Oil, and session volatility is light. Oil has today traded as low (78.24) as it has since the OPEC+ price gap; too, Oil’s “Baby Blues” (see Market Trends) have provisionally slipped below their +80% axis, suggestive of lower price levels; it thus appears the gap down to 75.83 shall close near-term. Also per Market Trends, the Bond’s linear regression has rotated to negative; next to do so looks to be that for Copper. The “live” P/E of the S&P (futs-adj’d) is 47.8x and the yield 1.633%; that for annualized for the U.S 3-month T-Bill is 4.995%. ‘Tis a key day for the Econ Baro, incoming metrics including April’s Philly Fed Index, plus March’s Existing Home Sales and Leading (lagging per the Baro) Indicators.

19 April 2023 – 09:14 Central Euro Time

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At present, save for the Euro and Spoo, all the other BEGOS Markets are below their respective Neutral Zones for today; volatility is moderate. We continue to watch Oil (per yesterday’s comment) as its technicals weaken toward a gap-fill to the 75.83 level. The Bond, per Market Trends, has seen its linear regression trend return to flat; those for the balance of the other Components remain positive, albeit the “Baby Blues” in each case are weakening. As for Market Rhythms, on both a 10-swing test basis and 24-swing test basis, the best of the bunch is Gold’s 2-hr Parabolic study. Late in the RTH session comes the Fed’s Tan Tome.

18 April 2023 – 11:08 Central Euro Time

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As we write we’ve the Euro, Swiss Franc and Gold above their respective Neutral Zones for today, whilst below same is Oil; still, BEGOS Markets’ volatility is mostly light, again as noted yesterday per Market Ranges narrowing. Oil’s daily technicals are showing early signs of weakening: currently priced at 80.45 (June cac), the gap closure to the pre-OPEC+ production cut is to 75.83, should more material selling ensue; too by Market Values (in real-time), Oil’s price shows as 5.10 points “high” above the smooth valuation line. For the Econ Baro today we’ve March’s Housing Starts/Permits.

17 April 2023 – 09:10 Central Euro Time

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Gold opens the week at present above its Neutral Zone for today; the balance of the BEGOS Markets are within same, and volatility is mostly light. The 700th Edition of The Gold Update anticipates a new All-Time High (above 2089) is nigh, albeit that price being sufficiently stretched at present that more imminently a peek back into the 1900s first is warranted; by Market Values (in real-time), Gold shows as +54 points above its smooth valuation line; too by Market Trends, Gold’s “Baby Blues” have slipped below their +80% axis, the rule of thumb there being to expect lower levels. And by Market Ranges across the board for all the BEGOS components, “narrowing” is the watchword, notably so for both Oil and the Spoo, both at their tightest EDTRs in at least a year. The Econ Baro looks to April’s NY State Empire Index and NAHB Housing Index.

14 April 2023 – 09:18 Central Euro Time

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The BEGOS Markets are quiet ahead of a barrage of Econ Data with eight metrics due, including April’s UofM Sentiment Survey, March’s Retail Sales, Ex/Im Prices, IndProd/CapUtil, and February’s Business Inventories. Only the Euro is outside (above) its Neutral Zone for today. At Market Values, the Bond is matched with its smooth valuation line, as nearly is the Euro; Oil is almost 7 points “high”, the Spoo 74 points “high”, and Gold 96 points “high”. The yellow metal yesterday came to just 25 points away from its All-Time High (of 2089); tomorrow brings our 700th consecutive Saturday Edition of The Gold Update.

13 April 2023 – 09:39 Central Euro Time

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We have largely recovered from the aforementioned hardware IT issue such that the website’s analytics are basically up to date. At present for the BEGOS Markets, Gold is the sole component outside (above) its Neutral Zone for today; session volatility is light. By Market Trends, the linear regression trends are firmly positive across the board. But, the S&P 500’s Moneyflow is showing signs of lacking puff: notably our five-day measure is negative; and the Index’s “live” P/E is 46.3x, more than double its lifetime mean. Today’s incoming metrics for the Econ Baro include March’s PPI.

12 April 2023 – 09:03 Central Euro Time

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Apologies as we’ve no material comment for today. We are dealing with a material (however resolvable) hardware IT issue. Note therefore, too, that the website’s analytics have not been updated through yesterday. We’re on the case and look forward to resolution in due course. Many thanks for your ongoing valued interest and patience. …m…

11 April 2023 – 09:19 Central Euro Time

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Money on balance is flowing early on into the BEGOS Markets: The Euro, Swiss Franc, Copper and Oil all are at present above their Neutral Zones for today; none of the other components are below same, and volatility is again light-to-moderate. Whilst by Market Trends all eight components are in positive linear regression, we’ve “Baby Blues” signaling weakening upside trend consistency for the Bond, the Euro, Swiss Franc and Copper. Meanwhile by Market Rhythms, the best performer on a 10-test swing basis is Gold’s 15-mn MACD, whilst on a 24-test swing basis ’tis the Euro’s 2-hr. Parabolics. Nothing specific is due today for the Econ Baro with inflation data due through the balance of the week.

10 April 2023 – 09:19 Central Euro Time

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Following the abbreviated week, (and ’tis still a holiday on this side of the pond), the BEGOS Markets are in full session: the Bond, Gold and Silver are at present below their respective Neutral Zones for today; the balance of the components are within same, and volatility is light-to-moderate. The Gold Update points to price’s geo-political price pop on Finland joining NATO: in since trading as low as 2004, the majority of that spike has faded, (typically following such pops); still, the CHN/TWN activity, too, is a concern that can re-buoy price. The Euro’s 2-hr. Parabolics lead the consistency tests (24-swing basis); as well the Euro’s “Baby Blues” (see Market Trends) are provisionally crossing below their +80% axis. The Econ Baro begins its week with February’s Wholesale Inventories.

07 April 2023 – 09:22 Central Euro Time

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We’ve an abbreviated session today: Only the Bond, Euro, Swiss Franc and Spoo are trading, the former three until 15:15 GMT and the Spoo until 13:15 GMT. This enables these BEGOS Markets components to respond to the StateSide March Payrolls data due at 12:30 GMT. At present, all four of those components are within their Neutral Zones for today; we shall account for today’s activity as part of the Monday, 10 April trade date. For the Econ Baro, along with the employment report we’ve February’s Consumer Credit. Saturday’s 699the edition of The Gold Update shall note price not surprisingly being lackluster following Tuesday’s geo-politically-driven spike, even as the Econ Baro is again weakening.

06 April 2023 – 09:23 Central Euro Time

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Similar to the case at this time yesterday, Copper is the only BEGOS Markets at present outside (this time above) today’s Neutral Zone; and again, session volatility for the BEGOS Markets is notably light. Following Gold’s geo-political spike on Tuesday, price has since lacked additional puff; as regular readers know, price spikes tends to sag following such events. Meanwhile, the Bond has not succumbed as our analytics suggested: by Market Trends, the Bond’s “Baby Blues” continue to decline, and at Market Values price is (in real-time) better than 5 points “high” above its smooth valuation line; however, the daily Parabolics which had signaled Short have since flipped back to Long; thus it remains to be seen if near-term the Bond reached down to our 126 target area, (price now 134). ‘Tis a quiet day for the Econ Baro with just the prior’s week’s Jobless Claims. Tomorrow, bourses are closed for Good Friday, however financial commodities shall have an abbreviated session to digest the StateSide Payrolls data.

05 April 2023 – 09:17 Central Euro Time

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Copper is the only BEGOS Markets at present outside (below) its Neutral Zone for today; session volatility is very light with respect to the otherwise increasing Market Ranges. Because Gold’s robust move yesterday to as high as 2043 (and again the high thus far today) was geo-politically driven (Finland joining NATO), we’re wary of the typical price retrenchment that follows such events; however technically, the up move was sufficient to flip the daily Parabolic study from Short back to Long; still by Market Values, price shows (in real-time) as 158 points “high”. For the Econ Baro we’ve March’s ADP Employment and ISM(Svc) Index, plus February’s Trade Deficit.

04 April 2023 – 09:18 Central Euro Time

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Post-OPEC+ Oil has been able to sustain yesterday’s gap-up gain; price at present is above today’s Neutral Zone, whilst all the other BEGOS Markets are within same; session volatility is light. The Oil price rise is sufficient that by Market Trends, all eight BEGOS components are now in positive linear regression; this is typical of a receding Dollar which today in the 101s is well down from the year-to-date high in the 105s. Still by Market Values, we’ve fairly extreme deviations for all five primary components: in real-time vis-à-vis their respective smooth valuation lines, the Bond shows as 4.6 points “high”, the Euro as 0.23 points “high”, Gold as 124 points “high” Oil as 4.7 points “high” and the Spoo as 120 points “high”. The Econ Baro looks to February’s Factory Orders. And Q1 Earnings Season is now underway.

03 April 2023 – 09:16 Central Euro Time

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OPEC+’s significant production cut announcement gapped Oil up at the open by +5.8%, indeed thus far by as much as +7.9%, (presently +5.1% at 79.56). With the exception of both Copper and the Spoo, all of the other BEGOS Markets are below today’s Neutral Zones, and volatility is moderate toward turning robust as the session unfolds. The Gold Update cites the yellow metal as the leading performer amongst all the BEGOS components, but that price by Market Values remains stretched, (the daily Parabolics having also flipped to Short), such that some pullback ought be imminent. Following the Econ Baro having dipped last week, it today looks to March’s ISM(Mfg) Index and February’s Construction Spending.

31 March 2023 – 11:53 Central Euro Time

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As Q1 comes to a close, we’ve the Euro, Swiss Franc and Copper all trading at present below their respective Neutral Zones for today; the balance of the BEGOS Markets are within same, and volatility is light-to-moderate. By Market Trends, the sole component still in negative regression is Oil even as its rising “Baby Blues” refute the downside consistency with price moving higher these last couple of weeks. The Bond, which produced negative “Baby Blues” and daily Parabolics signals has yet to move substantially in either direction; that pace ought accelerate today with the release of the Fed’s favoured inflation gauge of Core PCE Prices for February. Also included for the Econ Baro today are that month’s Personal Income/Spending, plus the Chicago PMI for March.

30 March 2023 – 09:19 Central Euro Time

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The BEGOS Markets remain fairly subdued this morning with volatility continuing at a light pace. Still, the S&P’s firm up session yesterday has pushed the P/E to a “live” (futs-adj’d) reading of 47.7x; too, the positive stance of the MoneyFlow has again shown its leading qualities for higher S&P levels despite broad expectations for significantly lower levels: indeed we still sense an S&P to reach sub-3000 as the year unfolds given poor earnings growth and attractive short-term debt yields. The Econ Baro’s metrics today include the final revision to Q4’s GDP.

29 March 2023 – 11:07 Central Euro Time

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Gold – the cac volume for which is rolling from April into June – is the sole BEGOS Market at present below its respective Neutral Zone for today; above same is the Spoo, and volatility remains light. The Bond issued two negative signals yesterday: the daily Parabolics flipped from Long to Short (from the June cac level of 130 11/32), whilst the “Baby Blues” (see Market Trends) confirmed closing below their +80% axis; the mid-126s seem a reasonable target area; too at Market Values, the Bond in real-time shows as nearly four points “high” above its smooth valuation line. For the Econ Baro today we’ve February’s Pending Home Sales.

28 March 2023 – 11:40 Central Euro Time

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Following a fairly inactive day for equities, we ‘ve at present the Euro above its Neutral Zone for today, whilst the Swiss Franc and Silver are below same; volatility is again mostly light. By our Market Ranges page, the Bond has been very expansive late, as has Gold, whereas less so have been Copper and Oil. That noted, by Market Trends, both the Bond and Gold are seeing their “Baby Blues” of linear regression trend consistency beginning to roll over to the downside: upon their breaching the +80% levels we’d then expect to see lower prices near-term; again by Market Values, Gold became quite stretched of late and — whilst clearly very cheap by currency debasement — our “live” deviation from the smooth valuation line shows price as 104 points high; should Gold indeed let go further, its Market Profile price supports are 1929, 1923, and 1912; (price is currently 1953). The Econ Baro awaits March’s Consumer Confidence.

27 March 2023 – 09:20 Central Euro Time

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The Swiss Franc is at present above its Neutral Zone for today, whilst below same are both Gold and Silver; and volatility is mostly light. The Gold Update acknowledges that although Gold is a bit stretched to the upside via our Market Values page, that nonetheless the near-to-medium term remains firmly bullish, and moreover that Silver has been catching up to Gold (the G/S ratio in decline, albeit still historically high). At Market Trends, the only two BEGOS Markets in negative linear regression are Oil and Copper. The “live” P/E of the S&P (futs-adj’d) is 46.5x. By Market Rhythms, our most consistent study on a 10-swing test basis is Gold’s 1hr. Price Oscillator; on a 24-swing test basis ’tis the Bond’s 30mn. Parabolics. The Econ Baro today is quiet ahead of a moderate week of incoming metrics.

24 March 2023 – 09:19 Central Euro Time

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Both the Bond and Silver are at present above their Neutral Zones for today; below same are both the Euro and Swiss Franc; and session volatility is light-to-moderate. We again stress per our S&P MoneyFlow page that the inFlow is outpacing the actual change in the Index itself, suggestive there still being no “fear” in the market, and that indeed higher Index levels are in the offing, even as the “live” (futs-adj’d) P/E is 46.1x. And at Market Values, the least deviation is by the Spoo at 43 points below its smooth valuation line; for the balance of the Primary BEGOS Markets, the Bond shows as nearly 7 points “high”, the Euro as over 0.02 points “high”, Gold as 151 points “high” and Oil as over 7 points “low”. The Econ Baro closes out its relative inactive week with February’s Durable Orders.

23 March 2023 – 09:34 Central Euro Time

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The S&P 500, after responding positively to yesterday’s anticipated +25bp FedFunds rate increase, was then significantly turned back negatively upon the Treasury’s not intending to expand protection for bank depositors. Regardless this morning, the Spoo is trading at present above its Neutral Zone for today, as too are both the Euro and Copper; Silver is below same, and volatility is light-to-moderate in the context that Market Ranges have expanded. By Market Rhythms, the two most consistent are the Bond’s 30-minute Parabolics and MACD. Included for the Econ Baro today are February’s New Home Sales and Q4’s Current Account Balance.

22 March 2023 – 09:23 Central Euro Time

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Ahead of the Fed, the BEGOS are expectantly quiet, all eight components at present within today’s Neutral Zones; volatility clearly is light. As has much of the FinWorld, we’ve moved our Fed guesstimate for today from +50bp (which was much the rage pre-banking ills) down to +25bp; for the Fed to do otherwise (no change or +50bp) would well set markets into a bit of a panic. At Market Trends, most of the components are in positive linear regression, the expectations being Oil and the Spoo (just barely). Indeed, the S&P’s extreme P/E aside (the “live” futs-adj’d reading now 46.9x), we continue to be impressed (albeit rather perplexed) at the differential between the S&P itself and its far more positive MoneyFlow: and indeed, the Flow being a leading indicator, the Index is holding up quite well in the face of banking illiquidity; indeed post-Fed into week’s end, higher S&P levels wouldn’t surprise us.

21 March 2023 – 09:20 Central Euro Time

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Given all the hand-wringing (and legitimately so) over banking illiquidity, ’tis curious to note the S&P 500 is trading ’round where it was upon transiting from February into August, (i.e. it hasn’t materially really gone anywhere). And this morning, the Spoo is quiet; amongst the other BEGOS Markets, only Gold and Silver are at present below their respective Neutral Zones for today, (see our “Hobson Close” reference in the current edition of The Gold Update), and volatility is mostly light. Notable extremes from our Market Values page include the Bond as some 6 points “high” above its smooth valuation line, Gold as 131 points “high” and Oil as nearly 10 points “low”. The Econ Baro awaits February’s Exiting Home Sales.

20 March 2023 – 09:21 Central Euro Time

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With UBS acquiring CS we’ve both the Bond and Gold at present above today’s Neutral Zones; below same are Oil and the Spoo, and BEGOS Markets’ volatility is moderate-to-robust. The Gold Update supports price within the fresh weekly parabolic Long trend as being en route to a new All-Time High (above 2089) and the mid-2100s reasonably in range within a few months (if not swiftly) on this run. Yields are coming off on the wake of banking illiquidity: of note, FedFundsFuts (which were above 5%) are now at 4.585% whilst the 3-month T-Bill (after nearly 5%) is down to 4.293%; comparably, the “live” yield (futs-adj’d) on the S&P is 1.737% and the excessively-high P/E is 44.3x. The Econ Baro has a very quiet week ahead with just five incoming metrics due; the week’s highlight is Wednesday’s FOMC Policy Statement, which given the banking strife may not render the otherwise anticipated +50bp increase.

17 March 2023 – 09:16 Central Euro Time

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Save for the Bond and Spoo, the other six BEGOS Markets all are at present above their respective Neutral Zones for today; volatility is moderate within the context that Market Ranges are expanding across the board. Despite the concerns over the banking sector, money continues to pour into the S&P 500, our MoneyFlow page for the quarterly measure suggesting the S&P (now 3960) “ought be” some 500-600 points even higher than ’tis; regardless, such rampant buying has pushed the “live” P/E of the S&P to a fut’s-adj’d 46.7x given, too, the lack of earnings growth; thus to revert to the lifetime mean of 22.6x would be a price correction of worse than -50%. The Econ Baro concludes its week with March’s UofM Sentiment Survey, along with February’s IndProd/CapUtil and Leading (lagging) Indicators.

16 March 2023 – 09:29 Central Euro Time

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The Euro and Swiss Franc both are at present above today’s Neutral Zones; the balance of the BEGOS Markets are within same, and volatility is mostly moderate, save for the Swiss Franc which is vibrant with a 129% EDTR tracing (see Market Ranges) as the SNB stands to assist CS. By our S&P MoneyFlow page, “no fear” remains the status: indeed for yesterday, the weakest Flow drain from the S&P was that by TSLA, whilst MSFT, AMZN and AAPL dominated the inflow. Gold appears poised to flip its weekly parabolic Short trend to Long if not by week’s end then in a week’s time, barring a notably down-run. The Econ Baro awaits metrics including March’s Philly Fed Index, plus February’s Housing Starts/Permits and Ex/Im Prices.

15 March 2023 – 09:29 Central Euro Time

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We’ve the Swiss Franc, Gold and Copper all at present below their respective Neutral Zones for today; none are above same, and volatility is light-to-moderate. At Market Trends, quite recently all in negative linear regression, now positive are those for the Bond, Euro (barely), Swiss Franc and Gold. By Market Profiles, Gold has built in trading resistance at 1911. Per Market Rhythms (on a 24-swing test basis) the most consistent study is Gold’s 60-minute Parabolics. And somewhat contrary to mainstream expectations, the S&P has been quite firm in the face of bank insolvencies, throughout which our MoneyFlow as a leading indicator has been fairly positive with lack of fear (as yet) in the balance. For the Econ Baro we’ve March’s NY State Empire Index and NAHB Index, February’s Retail Sales and PPI, and January’s Business Inventories.

14 March 2023 – 09:26 Central Euro Time

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The S&P 500 avoided mainstream expectations for a “Monday Massacre”, the Index finishing lower by an insignificant -0.2%; but ’twas certainly rangy, the Spoo itself trading in excess of 200% of its EDTR (see Market Ranges). This morning, the Bond is the sole BEGOS Market at present above today’s Neutral Zone; below same are the Euro, Swiss Franc, Gold and Oil; and volatility is moderate. Going ’round the horn for the five primary components per Market Values, we’ve the Bond as some 5.5 points “high” above its smooth valuation line, the Euro as 1.6 points “high”, Gold as 62 points “high”, Oil as 2.9 points “low” and the Spoo as 123 points “low”. The Econ Baro looks to February’s CPI.

13 March 2023 – 09:20 Central Euro Time

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As the Fed rides in on its white horse to scoop up Silicon Valley Bank’s depositors, the BEGOS Markets are firmly rallying as the Dollar dives toward a one-month low. The Euro, Swiss Franc, Glod, Silver, Copper and the Spoo are all at present above their respective Neutral Zones for today, whilst only below same is the Bond; volatility is moderate-to-robust, notably with the Bond, Gold and Spoo having already exceeded 100% of their EDTRs (see Market Ranges). The Gold Update highlights price’s perseverance given the Fed’s notion of not necessarily coming to the Treasury’s rescue upon a default. As for the S&P, the selling last week remained without fear as measured by our MoneyFlow page, the Index indeed barely reaching into “textbook oversold” territory.