Let These Potent Charts Speak: Where is The Enormous Capital in Bonds Going to Go?

Posted by Peter Grandich - Grandich.com

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U.S. Market – While I’m certainly not bullish I would caution anyone who is thinking about shorting the market on the assumption something more than a 5% -10% fall is in the cards. The economy sucks and the geopolitical problems around the world are very serious.

However (Dislike using this hedging word found in so many market forecasters vocabulary which include if, but, maybe….), a lot of bad stuff has been thrown at this market and it bends but doesn’t break. I suspect the FED is getting close to pushing on the string yet again and there’s going to come a time when the “Don’t Worry, Be Happy” crowd on Wall Street (who always says it’s a good time to invest) shall decide it’s time to shift some of the enormous capital in bonds into stocks. Here again, I don’t anticipate a surge upwards but shorting here is the one move I think is among the worse among the choices.


Gold – It may be hard to see with the naked eye, but gold has been building a base that I believe can lead to it taking out $1,650, which in my mind should signal the resumption of the climb in the “mother” of all gold bull markets. A seasonally favorable period for gold is just a few weeks away and if the perma-bears and gold haters (that’s basically 98% of the world) can’t get gold below $1,500 by then – it’s curtains for them (and I won’t be shedding a tear for them).


U.S. Dollar – It’s getting to the point where I would like to take a flyer on shorting Uncle Sam. I shall let you know if and when I do.

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Bonds – I’m looking for the 10-yr. T-Bond to get down to a 1.25% yield. At that point I feel getting seriously short is all but certain.


Oil and Natural Gas – No change here.

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Mining and Exploration Shares – The juniors are especially suggesting their wash-up is near complete. We actually started to see some bids come into the market late last week In case you forgot, a bid is where someone is actually willing to buy shares-lol).

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