As expected from the November 1st, update, gold pre-market shows a gap-higher open. Trading is around 178.80 – 179.00 which is a little above the resistance area shown in the original chart.
After the first hour of trading, the plan is to provide an update to see if there’s still a possibility of a reversal at this juncture (not advice, not a recommendation).
Correspondingly, the mining sectors, GDX, GDXJ are up in pre-market with inverse DUST and JDST, down.
However, the big hitter, NEM is right at a 50% retrace off the lows of October 28th. This is a possible area to stall and potentially resume a downward (or sideways) trend.
Other market actions that may have significant impact on silver/gold, are the four-standard deviation in the bonds to the short side.
As Steven Van Metre indicates, none of us reading this (in our lifetimes) are likely to ever see a set-up like this again. It’s an historic extreme.
Bonds are down in pre-market along with the dollar … using UUP as the proxy.
The dollar has bottomed and is now in position to rally; completely opposite the established consensus.
At least twice now, Van Metre has mentioned Wyckoff in his updates. He appears to be well aware of the significance.
In other markets, a position was opened in nat-gas, UNG at the last session. That position was closed in the pre-market session with a slight ding of -1.2% to the managed account.
Even with record cold hitting large portions of the country, nat-gas can’t seem to get going to the upside. Now, with its current action there may be a probability of lower prices (or stagnant action) going into winter.
We are leaving nat-gas alone for now and focusing on the historic bond set up and the potential effects when it all unravels.
Note: Posts on this site are for education purposes only. They provide one firm’s insight on the markets. Not investment advice. See additional disclaimer here.
The latest financial fad, the ‘dollar destruction’ narrative, appears to be losing steam … at least for now.
On the other side of the spectrum are the precious metals markets with their ‘all bets are off’, ‘this is it’, narrative.
Of course, it’s a dog pile of expert opinion on the whys of the dollar destruction.
Why not join nearly everyone else on the #MeToo, fiat currency bandwagon? A safe bet no doubt; we all know how important it is these days to “stay safe”.
So, what’s really going on?
Since this site follows principles laid down a century ago, by Richard Wyckoff, it’s not important to know the “why”. That reason changes daily if not minute by minute. The truth behind the move will eventually come out; long after the trend has reversed.
As trading legend Ed Seykota inferred, if you want to make money, fundamentals are essentially a waste of time.
What we see is downward thrust energy on the dollar proxy, UUP is declining. Downward enthusiasm is waning.
Does that mean go long on the U.S. Dollar? Well, that’s up to the reader. What is being presented here, is the latest hysteria is at least slowing down or coming to a pause.
As Jeremia Babe reports at this link, were just one or two innings into the greatest financial collapse of all time. The dollar may go through wild excursions before potentially coming to its long awaited fiat demise.