The tone on Friday was largely set by the resignation of Jurgen Stark from the ECB, the second German to resign this year after Axel Weber, previously widely tipped to have been the next head of the ECB, resigned in February. Jurgen Stark's resignation was ostensibly 'for personal reasons' but it is widely assumed that the resignation of both germans was primarily due to disagreement with ECB policy, and Jurgen Stark's resignation in particular to be in protest at the ECB's recent decision to start buying Italian and Spanish bonds.
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.
Making Sense of Today’s Gold Surge (Paulenoff)
If there is a specific reason why spot gold is up $38 since about 7:40 am ET, it has to be Chicago Fed Gov. Evans spewing forth comments that the economy remains weak (duh), and that more monetary stimulus is needed. That is all the gold bugs needed here in combination with President Obama cooking up another big stimulus plan that will spit into the wind of deficit reduction and fiscal austerity.
In any event, the vertical surge in the SPDR Gold Shares (GLD) from 174 to 178 in pre-open hours Tuesday has the look of the start of upside continuation of the rally off of last Thursday's corrective low at 165.88 to Friday's high at 178.17.
That said, the fact that this morning's strength pushed above Friday's high (to 178.36 so far) but has not followed through makes me suspicious of its underlying sustainability and warns me to wait and wait for 1-3 hours prior to jumping into a new long position into strength. Heavy resistance resides at 180.00, so any forthcoming long position must be "supported' by an accompanying pattern that has "structural potential" to surge through and sustain above 180.00/50.
Originally published on MPTrader.com.
Color, Mania, and Hedging Gold
Color, Mania, and Hedging Gold
Below are some thoughts on hedging gold, but before that, a quick aside, prompted by a chapter I read today in The Slope of Hope Bathroom Reader. On p.28 ("Color and Mania in the Valley), Tim mentions the mobile app Color, the creators of which received an astonishing $41 million in venture financing, as an example of the recent bubble in tech. As it happens, one of my daily clicks is the iOS app tracker AppShopper.com, which provides hourly rankings of Apple iOS apps. (Editor's Note – thanks for the book mention, Dave!)
The OTHER Commodity I’m Shorting
Black gold. Texas tea.
Why Silver Over Gold (by Mike Paulenoff)
During the last few sessions, my intraday gold/silver ratio work has been warning me that the recent leadership role of gold's upside acceleration might undergo a change. No, not that gold will reverse, but more than likely silver will begin to outperform gold again on the upside.
Again? Yes, remember that for 9-month period between July 2010 and April 2011, silver prices rocketed while gold prices climbed at a much more subdued rate of change.
My near- and intermediate-term ratio work is suggesting that the May-Aug gold leadership role is at or nearing completion, and that in the hours and days directly ahead, silver prices will begin to "out-accelerate" gold on the upside and show increasing resilience during periods of weakness.
The fact that silver prices hurdled their Apr-Aug resistance line this morning supports the unfolding leadership change.
Originally published on MPTrader.com.
