Long-term, I think precious is going to absolutely smoke stocks, as it has already been doing for a while. Short-term, I think (and hope!) precious metals gets absolutely bitch-slapped, since it needs a deep and healthy retracement and, selfishly, I’d like to pig out on palladium like a – – like — – like a pig that loves eating palladium.
Speaking of which, ever since I started getting all stalker-ish on the stuff, palladium (by way of its only decent ETF) has had a huge increase in volume.
My overarching “bullish precious/bearish equities” has worked great, but I’d like to caution you and me both when I point out that a similar situation took place before and completely sputtered out. Constant vigilance is a must!
My one-and-only metals play is to be short XME. I will cover some of this if it hits the trendline, but let me go on notice and say that if it in fact breaks the trendline, a bigger counter-trend drop is in the cards.
Returning to PALL, which I view as an important canary in the coalmine for metals, we’ve got an island reversal pattern already which is bearish. Keep a close eye on the gaps (marked with dashed green lines) for support. My sweet spot would be for it to get back down to around $115.
