TIP Break-Out Confirms Reflation Thematic, Augers for More Equity, PM Upside
As intimated as an increasingly likely outcome in this post on 3/2/16, treasury inflation-protected securities, via the TIP ETF, are breaking out of a consolidation/flag pattern put in place b/t lines (1) and (2) over the past five years. This…...
How the Fed Abdicated its Independence to White House Geopolitical Strategy on Russia For Nearly Two Years
In the chart below I plot crude, the Russian Ruble (RUB) and OPEC production. From 2012 through mid-2014 all three print sideways. However, to the day beginning on 7/29/14, crude and RUB begin to collapse while OPEC production soars. Why such…...
Increasingly Likely that the Past Year Has Been a Consolidation Pause Paving the Way for a Blow-Off Equity Rally
I increasingly struggle to find bearish historical precedents that line up with the market’s tone, tenor and structure over the past ~year. Though I was able to nail the collapse that came in Aug-15 right before it occurred and correctly saw…...
Inflation Set to Expand?
The chart below shows TIP, or a vehicle that tracks inflation-protected treasury security prices, with a gold overlay. When TIP is rising in value inflation-protected securities are being bid up in anticipation of inflation rising; when TIP is declining it…...
Gold’s To-Date Progress off its December 2015 Lows & Why $1,375-$1,475 Should be a Worst-Case Outcome for the Current Rally
Over the past year we’ve built a catalog of work on the site calling for a major low in gold. Within that body of work we attempted to form high-probability downside price targets for the metal that would offer attractive opportunities to begin…
Draghi Disappointment Unlikely, but Half-Life of Intervention Diminishing
Below you’ll see the ratio of the EUFN (MSCI Euro Financials ETF) vs. XLF (US Financials ETF). Note the long-term downward sloping channel b/t lines (1) and (2) it’s traded in over the period in which we have trading history…....
USD Rallies in a Historical Persepctive
Below I’ve analoged the three major rallies the USD (trade-weighted USD vs. major currencies) has enjoyed since the 1970s when the US abandoned the fixed-rate exchange system and linkages to gold that had been employed since Bretton Woods. As mentioned,…...
Additional Signs of Reflation and Implications for Gold
Earlier today in this post I discussed that the Producer Price Index for all commodities, or the PCAC Index (Bloomberg ticker), was signaling the potential for a strong global reflationary event to occur in the intermediate-term. I wanted to build on…...
Does a Major Reflationary Event Stand on the Horizon?
The PCAC Index (US PPI for all commodities) is plotted on a monthly basis below dating back to the early 1900s. As of the last print (Jan-16) and following a significant multi-year decline, it was a hair away from reaching…...
Can Gold Rally Without Commodities in General Also Participating?
Short answer: yes. Below I’ve shown all of gold’s trough to peak rallies dating back to the early 70s, or when Nixon abandoned the gold standard. What you’ll find is that out of six major cyclical or secular rallies in gold’s history,…...