Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Gold/Silver Ratio: Rising for a Month Now

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Well, look who is sporting a bullish looking pattern on its daily chart. It’s probably NFTRH‘s most watched indicator outside of the T Bond Continuum.

As you can see, a rising Gold/Silver ratio (GSR) attended the market stock market disturbances in February and March and a declining GSR has attended the relief, i.e. the expected ‘top-test’ by the S&P 500 that has ground on since roughly the same time that GSR topped in late March.

The GSR has spent a lot of the post-financial crisis era in dysfunction mode, but so far in 2018 it is working as we’d normally expect; it rises with market liquidity contraction and declines with risk ‘on’ and an absence of liquidity events.

So, is that indeed a bull pattern? Can we assign such TA to a ratio as opposed to a stock or an index? Valid questions, but all things being equal stock and/or commodity bulls would probably rather not see a pattern like that. What can’t be argued is that gold’s ratio to silver has been increasing for a month now. (more…)

A Macro (Amigos) Update for Mid-Summer

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You have better things to do than read droning macro analysis or long, drawn out investment theses. It is a weekend in the dead of summer and for that reason we go easy this week; real easy.

The 3 Amigos are here to simply say that things are as they have been, with Amigo #2 (long-term yields) getting home and pulling back on cue, and the other two (SPX/Gold ratio & Yield Curve) still in process and indicating risk ‘on’ and ‘boom on’, respectively.

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3 Amigos (SPX/Gold, Long-term Yields & Yield Curve) Updated

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It has been a while since we’ve had a 3 Amigos update because a) Italy and global tariffs noise aside, nothing much has changed with the macro and b) I felt my ‘image-based metaphorical content to straight content’ ratio was getting a little excessive. So I gave it a rest.

Now it is time again for an update of these important macro riders in order to touch base with their signals. As always, I’ll remind you that there is much more to the macro market backdrop that NFTRH manages on an ongoing basis, but these three are important.

The quick answer is that only Amigo #2 (long-term yields on a rise to our preset limits) has reached destination. I marked up the graphic as he was approaching our targets.

Note: The monthly charts driving the view that current trends remain intact can be considered big, dumb (i.e. not overly sensitive) indicators. Shorter-term views of these and other indicators can be used to gauge signs of oncoming changes. As one example, if daily SPX/Gold were to take a hard plunge on any given day or week (as was the case in February and March) we’d pay close attention as we did then before the larger trends ultimately took over again.

Amigo #1: Gold vs. the S&P 500 (or stock markets in general)

The theme for this Amigo is that the stock market (cyclical, risk ‘on’) has been trending up vs. gold (counter-cyclical, risk ‘off’) since 2011 in order to close out the negative cycle that completed that year. (more…)