49 thoughts on “CHART OF THE DAY

  1. Alexandru Popovici

    we may have to wait on that break for at least 1 month if the ECB decides to increase its QE on Thursday (a quite likely but non-tradable event until it becomes fact).
    We have 3 whispers of Lady Market that she favors a dovish ECB aftermath:
    – USX has refused to break lower preserving relative strength over equities even though the positive correlation btw the two is still valid;
    – miners have already started their intermediary decline;
    – now stocks are strongly while ignoring dismal Chinese macro reports from yesterday.

    Upbeat-PM-and-downbeat-dollar talk is jumping the gun with a high probability ECB action and with such a streak of opposite signals from the Market.
    On the other hand, if the ECB does NOTHING, then I will personally go long gold too on Thursday as USX will fall into IC decline – but now that seems unlikely.

  2. Ralph Wiederzane

    I dont know Gman, gold is crap and miners still stink to high heaven. Even permabulls at Sprott say 2016 will stink for metals prices as they go sideways at best, though they do recommend buying select miners into weakness for maybe 30% gains. I’m not sure why they would suggest getting involved in a sector that routinely loses 50% when the best upside scenario they see is some names rising 30% before pulling back.

    I’ll sit on the sidelines and wait to buy the S&P after a 20% correction instead.

    1. Gary Post author

      At this point all I’m expecting is another bear market rally out of gold. I don’t think the Boyz are done with it yet.

  3. harry

    well the end of the world for today’s open just didn’t happen much to the disappointed of the pornbears as expected. All hinges on OIL, gold is irrelevant at this point as it has been for years yet many on this site led by gold keep flogging the same dead horse. Missing the forest for the trees and not learning anything from it. Oil needs to turn, and the Iran dump of oil on flooded markets is largely discounted. A pop up in oil will let the market rise and dollar to drop at least for a decent short covering rally.

  4. Gary Post author

    Looks like a final bloodbath phase has begun for miners. They usually last 5-7 days. Once this is over we may have a final bear market low.

    SIL is 6 days into it’s bloodbath phase. That being said I expect this will continue into next week. We need the next leg down in stocks to begin. Once it does and there is no longer any doubt that the only option left is for the Fed to start QE 4 to stop the crash in stocks then the dollar will top and the metals will bottom. Right now the market is still hanging onto the idea that stocks may have formed a double bottom. That hope needs to be crushed by another sharp move down.

    1. harry

      sorry gary, it sounds like rinse and repeat the cycle. we may have a bottom for another 2 percent pop as before. until miners outperform this is such a waste of time and attention

  5. harry

    and he fed is a long way for qe4 or whatever as pornbears hope. It’s interesting how folks write a script for the market and then sit back and watch it not happen yet continue to believe it will. Like predicting sunshine because they want to have a picnic in a rainstorm

  6. Richard

    If the HUI bottoms around 75 and is not the bear market low, then there are other forces at play. There should not be another low after this. Look back at the divergence between gold and HUI from 2008. More specifically, gold doubled and HUI extended less than 40%. Now the miners are almost opposite of oil. The energy stocks are trading a high premiums to the price of oil indicating either oil is going to rally sharply or energy stocks will decline sharply.

    1. harry

      exactly Richard, miners are cratering while gold holding on in a range until it collapses once again in spite of all wishful thinking gold followers while oil doing the opposite, crashing while producers showing relative strength indicating oil groping for a bottom in spite of headlines

      1. Gary Post author

        This is always the sentiment during bloodbath phases. It will get more intense as the week goes along. But once it’s over we should have an exceptionally powrful rally in the sector.

  7. Mark

    even Sprott is not saying anymore to buy Miners ,they are scared to death as I am.
    I don’t know what to think,you said recently that you would have not sold the Miners now because it’s too late,Jeff Gundlach said something similar but the next target for HUi could be under 75,and there is no end in sight for this carnage.
    We have no final lows in sight,it’s insane.

    1. Gary Post author

      This is what bloodbath phases do. They make you think it will never end. If this is intense enough then we will get our final low.

      1. Mark

        I know Gary,
        the problem is that I’ve had enough of bloodbath phases,it’s since 2011 that I’m swimming in a bloodbath , I hope not to drawn.

  8. harry

    mark, gold bugs strange breed. when sprott goes negative then maybe now is time to hold for some upside but still to early to add, and has been for years in spite of all the bs

    1. Richard

      True Harry,
      I have listened to their interviews for informational purposes for years and I remember back to 2013 they continued to claim in 12-18 months would be a great bottom for the mining shares. I wonder if today they are saying the same thing?

  9. Rocky Balboa (@rockybalboaa)

    While miners r flushing out…GC_F/GLD showing relative strength and coiled for breakout to upside.

    This is a good article, and very much sums up my bias, that Gold has atleast bottomed for a 3 month rally into March, targetting 1150/1200.


    Unknown if lowers lows still ahead, but I suppose it’s possible to go below 1000.

  10. tim

    watch gdx in the next few days, if volume gets over 100 mil preferably over 120 mil then it may a good time for a short term bottom

  11. Atkjhi

    Looks like silver is bouncing off the bottom first. If it lasts more than a day we could on to something.

  12. JF

    Gary, do you know why NUGT is selling off even when Gold has been up? Right now it feels like it doesn’t matter at what price Gold is trading for NUGT to go down. Thanks

    1. Atkjhi

      Because the miners were resisting the decline and holding up better than the metals throughout December. It’s catch up time for the miners.

  13. Bill in Tokyo

    Daily GDX looks like a huge H&S from last July till now. And so far today, on a closing basis, today made a new low, breaking the neckline of say 13. Head at 17, measures to 9.

    1 hr SPY/QQQ/IWM charts show that we’re not making a lower low yet. Maybe a bounce soon?

    1. Bill in Tokyo

      Cool meter! Thanks for posting.

      Sure looks like SPY/QQQ/DIA/IWM are bottoming here. But I’m not sure it’s tradable – we may just gently drift higher for 2 weeks though, like the 2nd half of Dec, before the next deep cut.

  14. Dan

    So much laughable criminal intervention to keep this farce green when it should be crashing. Holding short for now.

  15. Mark

    New lows for miners .
    In the meantime PAAS sets new annual record for gold and silver production (but it’s falling hard as well as all other silver stocks)
    This guy switched from a positive sentiment towards gold stocks to a GLOBAL MATRIX,he thinks we will NOT have any bull market for a long time:
    Sprott international don’t have anymore the courage to suggest gold stocks for the long term,but just for trading.
    The analyst called Rambus thinks we are experienced a new leg of the bear market in miners,his HUI target : 54 !!
    If we don’t have THE low soon I think ,unfortunately, we have entered a new stage of market history,probably we have entered a global depression very similar to what Harry Dent have forcasted for a long time.
    I know that selling everything in this environment is probably insane,but I’m very tempted to do it.
    Hope is one of the worst human sentiment.

    1. Gary Post author

      This is the sentiment we see during final bloodbath phases. It should get more and more extreme as the week goes along. Look for a bottom next week and a big rally as all those shorts are forced to cover.

  16. mike trike

    Massive volume on NUGT again. Normal to low volume on GDX and GDXJ, SIL also normal volume. Not much of a bloodbath. More like a short attack. My Canadian miners are up again today. They tried a short attack on a few of them but buyers overwhelmed them and they gave up.

    1. Gary Post author

      I would agree, this looks like an attack on the miners over the last several days. If Canadians aren’t following then it’s specific to the US market.

      1. mike trike

        Unless they are pricing in another interest rate cut in Canada tomorrow and an even lower Canadian dollar? Not sure, but when the miners have tanked in the past my Canadian miners were sold off as well. Today they were strong.

        From the volume in NUGT it almost looks like Miners are being smashed so NUGT can be accumulated even cheaper. To me this looks like a possible change in trend.

  17. mike trike

    Also weak volume on DUST. This definitely does not look like the start of an new major plunge in miners.

  18. Bill J.

    Given Gary’s scenario of more sell-off of miners into the next week, HUI “can” hit the lower bound of 90s given its weekly chart’s support channel.

    Stay watching and be diligent on your shorts!

  19. Bill J.

    Similar “weekly” chart breakdown happened in early July 2015 to the mid of the month where HUI bottomed at its weekly chart support channel after shedding 27% while XAU lost 7%…

    This is a very similar reference point only…i believe no two time-frames are completely the identical, but it nevertheless rhyme…

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