• 2 hours Is Silver Gearing Up For A Rally?
  • 5 hours World’s Largest Hedge Fund Turns Bullish On Gold
  • 7 hours It’s Time To Spend More On Clean Energy R&D
  • 23 hours Contrarian Investors Are Beating The Stock Market
  • 1 day Bulgaria’s Revenue Agency Falls Victim To Biggest Cyber Heist In History
  • 1 day Amazon Faces European Union Anti-Trust Probe
  • 1 day Commodities Are Having A Stellar Year
  • 2 days Bezos’ Next Big Project Could Be Worth $100 Billion Per Year
  • 2 days 3,600 Years Later, Climate Change Turns Mammoths Into $40M Market
  • 2 days Tesla, Apple Claim China Is Stealing Intellectual Property
  • 2 days EV Giants Duke It Out For Battery Dominance
  • 3 days Tech Billionaire Takes Aim At Google
  • 3 days Chinese Police Bust Largest Ever Illicit Crypto Mining Operation
  • 3 days Expect A Pullback Before Gold's Next Major Rally
  • 3 days Why Interest On Gold Matters
  • 4 days Ten Extravagant Food Items For The Wealthy Only
  • 4 days Why Saudi Arabia Won't Give Up On The Aramco IPO
  • 5 days $32 Million Crypto Heist Halts Tokyo Exchange
  • 5 days Is A Gold Selloff Looming?
  • 6 days Central Banks Are Stashing Gold And Dumping Treasuries
Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

  1. Home
  2. Markets
  3. Other

Gold's Full House

Using the Macrocosm theme again (I can't get enough of this gimmick) let's update some key gold ratios in poker terms.

Macrocosm

Gold is currently working on a 'full house', with three of a kind (gold out performs stock markets, gold rises vs. commodities and gold rises vs. global currencies). We can call the pair needed to complete the full house economic contraction (to varying degrees globally) and confidence declines.


Gold vs. Stock Markets

Gold vs. developed world stock markets is bullish and consolidating. This is a critical macro consideration to the gold sector investment case and these weekly charts show trends changing vs. all world stock markets. The ratios are in consolidation as gold itself consolidates and markets bounce.

Gold:SPX Weekly Chart

Gold:STOXX50 Weekly Chart

Gold:TSX Weekly Chart

Gold:FTSE Weekly Chart

Gold:Nikkei Weekly Chart

Gold vs. Commodities is wildly bullish and consolidating a bit.

Gold:CRB Weekly Chart

Gold:Crude Oil Weekly Chart

Gold:Copper Weekly Chart

Gold:Palladium Weekly Chart

Gold vs. Currencies shows a breakout from a downtrend in Euros, consolidation above support in 'commodity currencies' of Canada and Australia, a breakout attempt in Yen and a clear vote of confidence in the risk 'off' metallic monetary asset vs. a paper risk 'off' note (Swissy).

Gold:Euro Weekly Chart

Hold:Canadian Dollar Weekly Chart

Gold:Australian Dollar Weekly Chart

Golkd:Yen Weekly Chart

Gold:swiss Franc Weekly Chart

Finally, in keeping with the poker theme, what beats a full house? 'Four of a kind'. Gold vs. the all-important US Treasury bond market is working on its 3rd week in trying to deal with the first restraining moving average. The pictures above show waning confidence and if this one (indicating confidence in a conventional risk 'off' repository vs. gold) joins them we will have four of a kind in gold's favor.

Gold:USB Weekly Chart

Obviously, 'five of a kind' would be ideal. While the 4th card above looks to be in process, the 5th is not. That's the 'yield curves rise' planet in the macrocosm. Whether calculated by dividing the 10 by the 2 or subtracting it, this curve is not yet rising. The implication is that the game has not completely turned the table on the Federal Reserve with respect to the market's confidence.

Gold:US 10-Year Treasury Weekly Chart


Bottom Line

Through all the years of gold bugs clicking the heels of their ruby slippers, demanding that inflation would drive gold higher any day now, it was the macro indicators that would tell the story. As we entered 2016 they began telling a story of a counter-cyclical environment that would be necessary to launch the gold sector. The story, or game, is not yet over but the odds are now in gold's favor. Prepare for volatility and opportunity as the process continues.

 


Subscribe to NFTRH Premium for your 25-35 page weekly report, interim updates and NFTRH+ chart and trade ideas or the free eLetter for an introduction to our work. Or simply keep up to date with plenty of public content at NFTRH.com. Also, you can follow via Twitter @BiiwiiNFTRH.

 

Back to homepage

Leave a comment

Leave a comment