Timing & trends

Gold: Yen Lightning & Love Trade Thunder

Posted by Stewart Thomson - Graceland Updates

on Tuesday, 29 March 2016 17:04

  1. Gold continues to track the sideways action of the US dollar against the Japanese yen, ahead of Friday’s important US jobs report.

  2. Investors who focus only on the USDX are focusing mainly on the action of one risk-on currency (the dollar) against another (the euro).

  3. That’s a mistake, because gold is the world’s premier risk-off asset. Gold’s price action against the dollar is highly correlated to the dollar’s price action against the Japanese yen.

  4. 2016mar29usd1Double-click to enlarge the image. This daily bars chart of the dollar against the yen shows the dollar is meandering sideways, roughly between 111 and 115.

  5. It’s unknown whether the dollar will break out to the upside or the downside from this trading range, but the target price zone of the huge head and shoulders top pattern is the 105 -107 area.

  6. A decline to that area would probably be accompanied by gold rallying to $1350, and perhaps to as high as $1500.

  7. Next, please click here now. Double-click to enlarge this daily bars gold chart.

  8. There’s a very large inverse head & shoulders bottom pattern forming, and I expect the right shoulder low could occur around the April 19 time frame. Here’s why:

  9. That’s when the Shanghai Gold Exchange (SGE) is scheduled to launch its gold price fix. The Chinese government has already told Western banks that their gold bullion dealings in China could be curtailed if they do not play a fair and significant role in the new gold fix platform.

  10. Please click here now. Gold often sells off quite strongly after Chinese New Year ends, but investment demand has surged, as I predicted it would when the gold market became more stable.

  11. I have more good news about the love trade, for higher gold price enthusiasts. To view it, please click here now. The ebb and flow of Indian gold demand is highly correlated to the monsoon season.

  12. For the past few years, El Nino has brought warm winters to the West, and relatively dry monsoon seasons to India. That’s about to change.

  13. Not only is El Nino fading, but La Nina appears like it will replace it, and that means bumper crops for Indian farmers who are the world’s largest gold buyer class!

  14. Also, La Nina can bring cold winters to the West, and higher oil prices. Rising oil prices tend to be accompanied by rising gold prices.

  15. The US jobs report occurs this Friday. Gold has a tendency to be soft in the days ahead of that report, and then stage a nice rally after the report is released.

  16. As the power of the love trade grows, the importance of the US jobs report is waning, and that is adding more overall stability to the market. That stability is highly attractive to Chinese investors.

  17. Polls in the USA suggest that while elderly citizens may want to rebuild the America of the 1950s with a Trump/Cruz team, America’s youth are obsessed with socialist Bernie Sanders.

  18. The US 1950s GDP “super boom” occurred after World War Two ended. The America of the 1950s was built by hard working veterans. I’m a little worried that America’s senior citizens may be overestimating the heart of the current younger generation to rebuild what they built, even with better tools and technology.

  19. So, my suggestion for stock market enthusiasts who dream of the past is this: focus on Chinese and Indian stock markets, where billions of gold-oriented hard working citizens stand more ready to take on any task, and get the job done.

  20. On that note, please click here now. I’ve suggested that Chinese stock market declines and crashes need to be bought, rather than predicted. Chinese culture is very old, and that society brings vastly more experience to the table than the West does. The latest news suggests that a major move higher in Chinese markets is coming, and probably in the very near future.

  21. Please click here now. Double-click to enlarge this key Chinese stock market chart. From a technical perspective, the upside implications I’ve annotated on this chart are in sync with the solid fundamentals and pension fund news that is now in play.

  22. Please click here now. Double-click to enlarge. This daily bars GDX chart shows support in the $17 area. I think it’s very important for gold stock investors who are out of this market to be substantial buyers in the $20 – $17 area.

  23. I’m a buyer on every 25 cent decline in this price zone, using my systematic capital allocator. If GDX declines below $17, I won’t do any more buying unless it makes a new low.

  24. I don’t expect that to happen. Instead, I think GDX is going to surprise most analysts, and stage a big rally towards the $28 area. That’s mainly because of La Nina affecting Indian demand, the action of the dollar against the yen, and the re-emergence of the Chinese investor class!

Thanks!
Cheers
st

Stewart Thomson
email:  stewart@gracelandupdates.com
email:  stewart@gracelandjuniors.com
email:  stewart@gutrader.com

Special Offer For Website Readers: Please send me an Email to freereports4@gracelandupdates.com and I’ll send you my free “GDX Versus GDXJ, Mano A Mano!” report. As the gold price moves higher, GDX will lead at times, and GDXJ will lead at other times. I highlight key leading stocks within each ETF, with key buy and sell signals for each!

Jack Crooks: Key Market Strategies

Posted by Jack Crooks - Wave Trend Analysis & Commentary

on Tuesday, 29 March 2016 14:14

blackswanA bit of paint drying over the last two trading sessions; but notable is gold trying to find support in here despite our expectation of a deeper correction lower (page 4 new levels added). And oil (USO) traced out a classic doji candletoday (page 5).

Stocks–SPY Daily [last 203.24]: No change to view. Correction lower likely underway. Stocks rallied to bang on the 78.6% resistance level at 205.23 we have been watching.  

…read more HERE

The Sun Is Rising On Coal

Posted by Seeking Alpha

on Tuesday, 29 March 2016 14:06

Summary

India is ramping up coal use.

Energy alternatives are complicated and expensive.

Metallurgical Coal is gaining along with other commodities.

After cutbacks, miners are making profits once again.

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Is the sun going down on Coal? not according to Peter Bradley (ex Goldman Sachs). Bradley set up Javelin Global Commodities in June last year. He has partnered with Murray Energy, E.ON and a few other ex commodity traders from Goldman Sachs. Together, they hope to take up the slack as major investment is being pulled out.

“The coal generation industry globally is going to be a tough business which creates opportunities because there’s a real desire and need to change – it’s change or die,” said Bradley.

Thermal Coal

….read more HERE

Stealth Bear Market

“I look at the overall market as being in a major transition. As we talked about in late 2014, there were a number of generational multi-decade and even multi-century cycles all coming to a head and I was looking at the timeframe of 2015-2017 as being really the first phase of that transition with a larger phase moving into 2021…

I have expected a very stealthy bear market where the majority of observers and participants would not be convinced that a bear market was actually unfolding until the second shoe, whatever that ends up being, drops. And that’s kind of what we saw in 2000-2001. You had the dot.com bubble bursting in the beginning of 2000 and… that weighed on some of the other indices but wasn’t enough to really drag them down until the events of 9/11 in 2001.

That was when the markets [finally gave in]… and that continued on until October of 2002. That’s the type of thing that I have expected in the indices this time around and everything I’ve seen up to this point has confirmed that with some precision that I wasn’t even expecting…”

Significant Low Still Ahead

“I think this is going to be an ongoing progression of lows, some of them being double-bottoms like we just saw in August and January… but for the overall bear market, it would not surprise me at all to see it continue into 2017, so I do think it is a progressive thing, not the type of bear market that we saw in 2008…

I’m looking for June to be the next important low. I think we could see an intervening top in this timeframe – late March, early April – and looking at a little bit of a danger period in mid-to-late April when you perhaps get that first convincing selloff and overall decline into June before the next 1-2 month bottom takes hold.”

Gold’s “First Wave”

“I definitely viewed 2016 as being the initial confirmation to me of a multi-year bull market in gold and silver. I described it as a golden year, which to me meant that… gold would see the first sustained and significant rally bigger than what we’ve seen in the last 3-4 years…

To me, all we’ve seen is just the first wave of a major gold advance. Now the second wave, after the correction off that initial impulse wave, is often a long drawn-out affair with a lot of volatility. A couple of times where the market starts to run up towards its highs and everyone gets really frothy with their expectations and then all of a sudden turns back down and you kind of drag out that second wave corrective period. I could see something a little like that with gold, although we might only be talking a couple months there, but I do expect a much bigger advance later in 2016 and then into 2017 and 2018…”

40-Year Cycle

“But also this 40-year cycle that we’ve talked about, it’s just uncanny how consistently we’ve seen a major battle between gold and silver, fiat currency or paper currency, and the attempts at either centralized or decentralized control of money that has repeated in this country since its founding in the 1770s…

The last big battle was in the 1970s and involved everything from Nixon shutting the gold window in ’71 to the collapse of Bretton Woods in ’73. But it was really in the 1975-1976 period that I saw the most significant event and the first one was all of OPEC agreeing to price oil in dollars, which then gave the dollar a new kind of backing. And then in ’76 with the Jamaica Accord, which was really all of the westernized, industrialized countries basically codifying into an agreement that gold no longer played any role in the calculation and the backing of currency and, to me, that ushered in a new 40-year cycle that comes to fruition in 2016…”

Listen to this full podcast interview with Eric Hadik of Inside Track Trading and 40yearcycle.com by clicking here.

Retiring Abroad: Ever Thought About It?

Posted by Nilus Mattive

on Tuesday, 29 March 2016 14:00

I just got back from a week in El Salvador with my wife and daughter, and while the trip got off to a rough start — full of delayed flights and lost luggage — we ended up having a GREAT time.

You might think it’s a little crazy to spend spring break in a Central American country that boasts one of the highest murder rates in the world. But as I recently explained in my latest issue of Income Superstars, it is precisely those kind of headline worries that create opportunities for savvy travelers.

To wit …

We stayed in a luxurious oceanfront room, with its own private plunge pool on the balcony, for less than I’ve paid at a budget hotel in Florida.

When I got out of the surf, a guy stood ready to grab my board, throw a towel over my head, and hand me a bottle of cold water — services I would never request but that were just customary in a place that aims to please.

We never spent more than $25 on dinner — for a family of three, including drinks. The typical entrée of local fish, veggies, and corn tortillas was going for about $6 at one of the “fancier” places in town.   

On one excursion, my guide pointed out some houses in a new beachfront community and noted they were selling for about $100,000. Speaking of which, El Salvador is officially on the U.S. dollar and has been since the early 2000s.

And healthcare? It’s universal, though I definitely had no desire to visit the nearest hospital about 45 minutes away in San Salvador.

Obviously, visiting a place like El Salvador isn’t for everyone. And choosing to stay there for a longer period of time is probably out of the question for many more.

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But I’m telling you all of this because it highlights some of the opportunities that are available outside of the United States … opportunities that can be reached in less than six hours from most major U.S. cities.

So Let Me Ask: Would You Ever Consider Retiring to a Foreign Country?

In just the last year, I’ve been to France, Germany, Italy, Mexico, and El Salvador. And quite frankly, I could have stayed in any one of those places for months on end. The same is true of other countries I’ve visited whether you’re talking about South Africa or Peru.

More importantly, just about everywhere I’ve been I’ve met fellow Americans who are doing just that — living out their dreams in picturesque towns that most people only see on postcards.

Indeed, more and more U.S. citizens are choosing to live abroad — even if it’s just through VERY extended vacations — so they can stretch their retirement dollars further, gain access to affordable medical care, have new adventures, even hire personal assistants for less than a daily meal at McDonald’s.

Consider Panama, a country I visited back in 2001 …

There are spectacular and affordable beachfront condos that you can rent for a few hundred bucks a month.

And on the kind of budget that wouldn’t even cover rent here in the U.S., an expat can retire in impressive comfort in Panama, thanks in part to the country’s special Pensionado program.

You’ve probably heard of it — a special program that allows income-earning foreign retirees to obtain indefinite residence in the country plus get a whole host of other benefits including big discounts on movies, concerts, bus fares, medical services, and a whole array of other things. 

Or what about Thailand, which I traveled to eight years ago …

I personally know a number of U.S. citizens who now live there at a fraction of what they spent here. I’m talking about personal chefs, nightly massages, high-speed Internet connections, and beachfront accommodations for less than renting an apartment in Philadelphia or Kansas City.

And although it’s still on my “to visit” list, Ecuador also provides an attractive package for American retirees — including discounts on many services plus the ability to participate in the country’s national retirement system for about $60 a month.

I could keep going all day … Nicaragua, Costa Rica, Malaysia, and countless other places that provide bountiful benefits worth exploring. 

Heck, I have one friend near retirement who plans on buying a sailboat and spending the first part of his golden years going wherever he wants!

At the end of the day, the point I’m trying to drive home is that increasing income is certainly one way to better your situation no matter what your age. But changing your perspective, cutting costs, and considering less-traveled paths is certainly another — and complementary — way to get the things you want out of life.

So get out there and do some research. You’ll be amazed at what you find. And if you’re already living your dream, don’t hesitate to write in and tell me about it!

Best wishes,

Nilu

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