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MAX Apathy: Gold, Bonds, Turning points, and the Solar Eclipse

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MAX APATHY, Turning points, and Solar Eclipses

 

Have we passed the Moment of Maximum (financial) Complacency? Probably !

 

TLT versus GLD / Gold ... since 5/17/2011

TLT-GLD-4yrs_zpswz6rcqdl.gif

 

The alarm clock is starting to vibrate - as an important Ratio (below) is showing us.

 

A MAJOR TURN has probably occurred recently... and this becomes more apparent every day. We may be at the beginning of a growing recognition of the Financial Chaos which is coming our way, People are losing their complacency, and waking up, if a bit slowly. Prices are beginning to shift to recognize the larger reality, which many have struggled to forget. The markets were kind for years, but a major turning point seems to be behind us. Max(imum) Apathy has been signaled by an important financial ratio, which I want to explain:

 

MOMC15_zpsfyshmgf9.png

 

"I see a Bad Moon A-Rising" / Prior to the MoMC, only a tiny minority would see or let themselves imagine the coming financial storm

 

When was the day (of the MoMC)? the charts show it clearly: March 20, 2015

Here are some closing prices on that important day of the turning point.

 

Price: 03/20 : R.to-GLD

Gold: $1,182 : r-104.1%

TLT-: 131.51 : r-84.07%

Ratio R-8.74 : ======= > GLD-to-TLT was: 0.865, I call that "Max Apathy"

GLD: 113.57 : =======

DXY : 97.801 : r-86.11%

SPY : 210.41 : r-185.7%

VIX- : v13.02 : r-11.46%

DBA: $22.55 : r-19.86%

=====

Within a few days of the MoMC /MoMA upturn, we saw:

==========

+ A peak in the Dollar (DXY), 5 trading days earlier, on 03/13, at 100.30, and the DXY peak on March 20th was 99.051, just 1% lower,

+ A SPY high of 212.02 on 3/02, the first trading day of March. Peak on MOMC was 211.02, less than 0.5% lower.

+ The GLD closing Low for 2015 was 110.21 (Gold=$1,148), just three trading days before the MoMC Ratio to TLT.

+ The closing for TLT/Bonds, which was registered just two trading days later, at 132.62 on 3/24/15. That high now looks like an important "right shoulder" or lower high; helping to complete a possible major top in Bonds. The highest high - a possible major peak in TLT/ Bonds was at 138.50 six weeks eariier on friday, 1/30/2015.

 

MoMC was a central point of those important Turns... but that's not all... something else happened that day, which I will discuss in the next post. It was a rare event !

 

Here is a key ratio : Gold -to- TLT, which identifies the MoMC Date very clearly: ... update

Gold-toTLT_zpsrihjlzsk.png

 

Why is this rarely discussed ratio so meaningful?

It shows the relationship between two key "Safe Haven" Assets

 

GLD vs. TLT chart ... update

SolarTLT-GLD_zpsuxcm50kx.gif

 

+ Gold : is probably the ultimate safe haven asset. It is the tried and tested "money of History",

Gold is a rare monetary asset, which is not someone's liability, and has tangible value in its own right,

with intrinsic value; uses as jewelry, and essential application in electronics and medicine.

 

+ TLT /T-Bonds : are only a safe haven for those who believe in the PROMISES of the US govt, and its currency.

A T-Bond is a promise to pay a large US dollar amount in the distant future, with some small USD payments along the way

 

Timing, if the dollar falls out of favor, what will investors think of the financial promises of the US government?

It looks as if we have just seen a Major Top in the US Dollar - at DXY-100, just a week before the March 20th event.

 

DXY_20Mar_zpsnrkes1vj.gif

 

Obvious, Bonds have become a very risky asset, if the USD is going out of favor.

And the turn in the Dollar may now be behind us, synchronized with a Total Solar eclipse, and a shift away from Bonds.

 

 

LINK to here :: http://tinyurl.com/MaxApathy

(Note: the "Complacency" measure 8.74 uses Gold, and "Apathy" 0.865 used GLD - they happened the same Day !)

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A Total Solar Eclipse happened on same day (March 20, 2015) suggesting the Turn's timing was no accident

 

 

4221396001_4116655917001_ECLIPSE.jpg?pub

 

Eclipse-Mar20_zpsf11cbize.gif

Eclipse Info : 2015 Mar 20

Total solar eclipse of March 20, 2015

SE2015Mar20T.GIF : Eclipse Records

The path of totality for this eclipse will be limited to the North Atlantic and Arctic Oceans between Greenland and northern Russia which means skywatchers in Europe, northern Africa, and northwestern Asia will be treated to a partial solar eclipse.

The longest duration of totality will be 2 minutes 47 seconds (at 09:45:24 UTC) off the coast of the Faroe Islands, in the Norwegian Sea. Moon's shadow will resemble a huge eclipse about 463 km (288 miles) wide and 150 km (93 miles) long.

The only populated places, reachable by public travel, where the totality can be seen are the Faroe Islands and Svalbard archipelago. Unfortunately, chances for a clear sky there will be pretty slim.

====

Path of the eclipse: http://eclipse.gsfc.nasa.gov/SEgoogle/SEgoogle2001/SE2015Mar20Tgoogle.html /

Solar eclipse of March 20, 2015 - Wikipedia, the free ...

 

On the day after the Eclipse and MoMC, here's what I wrote in my Diary:

A TURN in the Dollar, and maybe even in Gold may have happened this week.

 

There were some big reversals - and a Huge Jump in views here too - It's interesting how these go together

 

Mar.: -SPY-: Chg : volume/ GDX : Chg. : -GLD- : Chg : volume: x10.3? : WTI.Cr: -DXY-- -Chg- : --TLT--: -Chg- : Posts= / Views: cum'l

18: 210.46 +2.50 : 206.M: 18.84 +0.91 : 112.37 +2.16 : 12.2M: 1,166.4 $44.69* 97.807 - 1.796 : 131.49 +2.49 : 03 : 086 / 166 : 1,472 /

19: 208.56 - 1.90 : 000.M: 18.71 -0.10 : 112.29 - 0.08 : 0.00M: 1,170.5 $45.60* 99.067 + 1.260 : 130.82 -0.67 : 06 : 092 / 528 : 2,000 /

20: 210.41 +1.85 : 149.M: 19.33 +0.62 : 113.57 +1.28 : 7.98M: 1,181.7 $46.45* 97.801 - 1.266 : 131.51 +0.69 : 02 : 094 / 281 : 2,281 /

 

(From above):

Will the Dollar Rally peter out below 99.50?

DXY / Trade-weighted USD ... update

DXY_zpsc8n0qwlk.gif

And so it did - the Resistance near 99.50 held, and the DXY/dollar dropped

A TURN looks more powerful - in the AUD

AUD_zpszwxw1bn3.gif

... than in the EUR

EUR_zpselszzpg8.gif

Note that AUD is above the 21d-MA - but has not yet broken the down channel, and is below the 76d-MA.

=

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PAST TURNS in "safe havens" ratio examined

 

Gold-toTLT_zpsderysjt1.png

 

TURN: L1a - : -- 2012 -- ... L1b - : --2012--

Price: 06/01- : R.to-GLD ... 07/23 : R.to-GLD

Gold : $1,606 : R- 10.20 // $1,572 : R- 10.27

TLT-: 130.36 : r-82.77% // 130.79 : r-85.47%

Act.R: r12.32 : R - 1.208 // r12.02 : R- 1.170 : actual (Stockhouse uses a different data source than Bigcharts)

Ratio r12.87 : R - 1.281 // r12.89 : R -1.251 : per stockhouse

GLD: 157.50 : =======. // 153.03 ========.

DXY : 82.799 : r-52.57% // 83.717 : r-54.71%

SPY : 128.16 : r-81.37% // 135.09 : r-88.28%

VIX- : v26.66 : r-16.93% // v18.62 : r-12.17%

DBA : $25.80 : r-16.38% // $29.96 : r-19.57%

=====

TURN: H-1 - : -- 2012 -- ... H-2 - : --2013--

Price: 10/04 : R.to-GLD ... 02/06 : R.to-GLD

Gold: $1,792 : R - 10.06 // $1,674 : R- 10.34

TLT-: 122.74 : r-70.70% // 116.93 : r-150.4%

Act.R: r14.60 : R - 1.414 // r14.32 : R- 1.388 : actual

Ratio r16.00 : R- 1.590 : // r15.55 : R- 1.504 : per stockcharts

GLD: 173.61 : =======. // 162.30 ========.

DXY : 79.353 : r-45.71% // 79.773 : r-49.15%

SPY : 146.13 : r-84.17% // 151.16 : r-93.13%

VIX- : v14.55 : r-08.38% // v13.41 : r-08.26%

DBA : $29.30 : r-16.88% // $27.35 : r-16.85%

 

TURN: L2a - : -- 2013 -- ... L2b - : --2013-
Price: 04/15 : R.to-GLD ... 06/28 : R.to-GLD
Gold: $1,353 : R- 10.30 // $1,234 : R- 10.28
TLT-: 122.99 : r-112.8% // 109.69 : r-109.9%
Act.R: r11.00 : R- 1.068 // r11.25 : R- 1.086 : actual
Ratio r11.51 : R- 1.128 // r11.30 : R- 1.099 : per stockcharts
GLD: 131.31 : =======. // 119.11 ========.
DXY : 82.417 : r-62.77% // 83.177 : r-69.83%
SPY : 155.12 : r-118.1% // 160.42 : r-134.7%
VIX- : v17.27 : r-13.15% // v16.86 : r-14.15%
DBA: $25.46 : r-19.39% // $24.90 : r-20.91%

====

TURN: H-3 - : -- 2013 --
Price: 09/03- : R.to-GLD ...
Gold: $1,413 : R- 10.36 //
TLT-: 104.22 : r-76.40% //
Act.R: r13.56 : R- 1.309 / : actual
Ratio r14.34 : R- 1.378 / : per stockcharts
GLD: 136.42 : =======. //
DXY : 82.361 : r-60.37% //
SPY : 164.31 : r-120.4% //
VIX- : v16.61 : r-12.18% //
DBA : $25.12 : r-18.41% //

 

TURN: L3a - : -- 2013 -- ... L3b - : --2014--

Price: 12/23- : R.to-GLD ... 01/31 : R.to-GLD
Gold: $1,197 : R- 10.36 // $1,244 : R- 10.25 :
TLT-: 103.66 : r-89.69% // 108.28 : r-89.25%
Act.R: r11.55 : r-111.5% // r-11.49 : r-112.0% : actual

Ratio r11.87 : r-115.0%. // r11.75 : r-114.0% : per stockcharts
GLD: 115.57 : =======. // 121.32 : =======
DXY : 80.447 : r-69.61% // 81.252 : r-66.97%
SPY : 182.53 : r-157.9% // 178.18 : r-146.9%
VIX- : v-13.04 : r-11.28% // v18.41 : r-15.17%
DBA : $24.65 : r-21.32% // $24.65 : r-20.31%

 

====

TURN: H-4 - : -- 2014 --

Price: 03/14- : R.to-GLD ...

Gold: $1,383 : R- 10.39 //

TLT-: 108.52 : r-81.53% //

Act.R: r12.74 : R- 1.227 /: actual

Ratio r13.36 : R- 1.278 /: per stockcharts

GLD: 133.10 : =======. //

DXY : 79.407 : r-59.66% //

SPY : 184.66 : r-138.7% //

VIX- : v17.82 : r-13.39% //

DBA : $28.60 : r-21.49% //

 

TURN: L-4 - : -- 2015 --

Price: 03/20- : R.to-GLD ...

Gold: $1,182 : r-104.1%

TLT-: 131.51 : r-115.8%

Act.R: r-8.99 : R- 0.864 : actual

Ratio R-8.74 : R- 0.841 : per Stockcharts

GLD: 113.57 : =======

DXY : 97.801 : r-86.11%

SPY : 210.41 : r-185.7%

VIX- : v13.02 : r-11.46%

DBA : $22.55 : r-19.86%

A similar ratio between "safe havens", but using GLD -to- TLT, instead of Gold ... update

sc_zpstqvpexpw.png

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Longer Term : GLD vs. TLT ... update +oilb,spy : Less Lines / GLD-all : TLT-all :

GLD-vs-TLT_zpsexi708su.gif

 

Turn : Date ---- : $-Gold : -GLD : -TLT- : G /TLT : Turn : Date ---- : $-Gold : -GLD : -TLT- : G /TLT :

Low1 : 05/31/05 : $414.5 : $41.65 : 095.00 : 0.438 : Hi -1 : 05/12/06 : $725.0 : $71.03 : 082.65 : 0.860 :

Low2 : 10/04/06 : $573.6 : $56.37 : 089.83 : 0.628 : Hi -2 : 03/17/08 : $1,011 : $99.17 : 095.73 : 1.036 :

Low3 : 10/23/08 : $720.0 : $70.65 : 097.77 : 0.723 : Hi -3 : 06/25/10 : $1,254 : 122.76 : 099.05 : 1.239 :

Low4a 07/27/10 : $1,168 : 113.51 : 098.65 : 1.151 : Hi -4a 08/22/11 : $1,878 : 184.50 : 110.92 : 1.663 :

Low4b 08/31/10 : $1,246 : 122.08 : 108.56 : 1.125 : Hi -4b 09/06/11 : $1,895 : 182.90 : 113.68 : 1.609 :

Low0 : 00/00/00 : $000.0 : $00.00 : 000.00 : 0.000 : Hi -0 : 00/00/00 : $000.0 : $00.00 : 000.00 : 0.000 :

=====

News:

Low.1 : 05/31/05 : $414.5 : Tony Blair wins 3rd term

High1 : 05/12/06 : $725.0 : New record copper price above $4/lb.

Low.2 : 10/04/06 : $573.6 : DJIA over 11,850 for first time

High2 : 03/17/08 : $1,011 : Stocks drop, as JPM buys Bear Stearns; New USD Low: EUR-$1.59

Low.3 : 10/23/08 : $720.0 : (Quiet day for news flow)

High3 : 06/25/10 : $1,254 : (Quiet day for news flow)

Low4a: 07/27/10 : $1,168 : Floods in South China; BP CEO steps down (Deep Horizon)

Low4b: 08/31/10 : $1,246 : Hurricanes in US, floods in Pakistan

Hi -4a : 08/22/11 : $1,878 : Battle of Tripoli, Libya; Crude falls with downfall of Qaddafi

Hi -4b : 09/06/11 : $1,895 : Tropical storm watch: Katia; SNB sets min. CHF rate

Recent: 03/20/15 : Total Solar Eclipse

Coming: 09/13/15 : Partial Solar Eclipse : http://eclipse.gsfc.nasa.gov/solar.html

======

> Wiki : http://en.wikipedia.org/wiki/October_2006

> Ch.T: http://articles.chicagotribune.com/2006/may/12

> Eclipse record : http://eclipse.gsfc.nasa.gov/solar.html

 

(old format)

TURN : L* 1- : May 2005 : . H* 1 : May 2006 : /// TURN : L* 2 - : Oct. 2006 ... H* 2- : Mar. 2008:

Price : 05/31- : R.to-GLD ... 05/12 : R.to-GLD : /// Price : 10/04- : R.to-GLD ... 03/17 : R.to-GLD :

Gold: $414.5 : R - 10.00 . // $725.0 : R- 10.21: /// Gold: $573.6 : R- 10.18 : // $1,011 : R - 10.19 :

TLT-: 095.00 : r - 228.1% // 082.65 : r- 116.2% /// TLT-: 089.83 : r- 159.4% // 095.73 : r- 96.53%

Act.R: r- 4.36 : R - 0.438 // r- 8.77 : R - 0.860: /// Act.R: r- 6.39 : R - 0.628: // r-10.56 : R - 1.036

GLD: 041.65 : ======== // 071.03 : ======== /// GLD: $56.37 : ======== // $99.17 : ========.

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Not sure why it's taken people so long to wake up. After 2008 nothing has been fixed.

 

The financial system created when Nixon closed the gold window in 1971 is coming to an end.

 

I expect massive events in the next 5-10 years.

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Time to update this old chart?

 

Divs (Mar'15) : $ 40.81
Gold price --- : $1,187.2 / 40.81 = 29.09
Gold (Mar'15) : $1,185.5 / 40.81 = 29.05

 

goldtospxdivs2_zpsitz7pbwc.jpg

'DrBubb', on 28 Mar 2013 - 02:31 AM, said:snapback.png

The Gold-to-Dividends Ratio

This Ratio is something that has made great intuitive sense to me for a long time.
I have wanted to look at it over many decades, but I did not have the data to do that until I stumbled across the Excel spreadsheet on Professor Shiller's website earlier today. (I spend most of the afternoon adding the Monthly Gold data, so now I am able to run the chart):

goldtospxdivs.jpg

I find the chart very revealing.

Trigger Levels:
======

+ Below 20, you want to be Selling Stocks, and Buying Gold
+ Approaching 80 or higher, you want to by Selling Gold and Buying Stocks

Current Level:
Gold ($1,600) to SPX-divs ($31.25) is: 51.20

Recent High was: August 2011
Gold ($1923.70) to SPX-divs ($24.90-Aug.'11) was: 77.25, or
Gold ($1923.70) to SPX-divs ($24.62-July'11) was: 78.13.

The record high was 1980, when the Ratio near 120 :1 at the beginning of 1980.

For 15 months (from Dec.1979 to Feb.1981) it was above 80, providing a long exit window.

A long slide in the Gold price, culminating in Gordon Brown's selling 60% of the UK Gold reserves between 1999 and 2002, helped to provide a nice long Gold buying window. The Gold-to-SPX-dividends ratio was below 20 for over 5 years from Nov. 1997 to Dec. 2002. The low Ratio was Aug. 1999, when Gold was $256.70 and Dividends were 16.38. for a low Ratio of 15.67.

Assuming SPX Dividends of 32, some Gold price Targets can be generated, as follows:

Rx 80 : $2,560
Rx100: $3,200
Rx120: $3,840

I note Jim Sinclair's targets (as follows)- is he using something similar to this Ratio ?
(From NOTES, received by email- on the JS thread):
ON TIMING AND PRICE:
“Anything below $3,500 is a buy. Anything above $4,400 is a sell”.*

== ==

If SPX-divs manage to climb to 35.00, then $3,500 is 100x and $4,400 is 125.7x


From a new thread in the Members only section:
http://www.greenener...showtopic=17618

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Yup.

Gold's looking cheap versus bonds.

And at 29x Dividends, maybe cheap versus Stocks too.

 

But we thought that before, and Gold did not move.

What will make it happen this time?

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Not everyone thinks that the Dollar is done yet.
A guy whom I respect, and whom has made many good calls is Tony Caldaro, who sees much more upside in the USD - and that means more downside in non-dollar currencies.

Here are his longer term downside targets for various currencies once the Dollar bull market resumes

 

EUR (in USD) ... update / AUD : CAD : CHF : GBP : JPY-FXY :

EUR_zpspsniftea.gif

Currency : B-high : Mar-L : Current: Poss-H: Target Low Year
EUR ------- : 139.93 : 104.62 : 114.00 : 115.00 : Low-80's, 2017/18
CHF, JPY --- :
AUD ------- : 110.68 : $75.32 : == ? == : = ? == : About 50, 2017/18
CAD ------- : 110.17 : $77.92 : == ? == : = ? == : Low-60's, 2017/18
===
> https://caldaro.wordpress.com/2015/05/11/currency-market-update-2015/

 

I suppose this all goes with his forecast of eventual lower lows in Gold

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SEVEN MOST FAMOUS ECLIPSES in History

 

SciSource_3F8576.jpg

 

Ugarit Eclipse

One of the earliest solar eclipses recorded, the Ugarit eclipse darkened the sky for two minutes and seven seconds in 1374 B.C. Mesopotamianhistorians in Ugarit, a port city in Northern Syrian, recount that the sun was "put to shame" during this total eclipse

.

eclipse-china.jpg

Early Chinese Eclipse

In 1302 B.C., Chinese historians documented an epic total eclipse that blocked out the sun for six minutes and 25 seconds. Because the sun was a symbol of the emperor, an eclipse was seen as a warning to theleaderlb_icon1.png. After an eclipse, an emperor would eat vegetarian meals and perform rituals to rescue the sun, according to a 2003 study in the Journal of Astronomical History and Heritage. [Fiery Folklore: 5 Dazzling Sun Myths]

.

Assyrian Eclipse

In 763 B.C., the Assyrian empire, which occupied what is now Iraq, the sun was completely eclipsed for five minutes. Early records from the period mention the eclipse in the same passage as an insurrectionin the citylb_icon1.png of Ashur, suggesting that the ancient people linked the two in their minds.

.

The Crucifixion of Jesus

The Christian gospels say that the sky was darkened for hours after the crucifixion of Jesus, which historians viewed either as a miracle or a portent of dark times to come. Using astronomy, later historians have used this mention to pinpoint the death of Christ. Some historians tie the crucifixion to a one minute 59 second total solar eclipse that occurred in the year 29 C.E., while others say a second total eclipse, blocking the sun for four minutes and six second, in 33 C.E. marked Jesus' death.

.

Birth of Mohammed

The Koran mentions an eclipse that preceded the birth of Mohammed. Historians later tied this to a total eclipse that lasted three minutes and 17 seconds in 569 C.E. The sun also disappeared for one minute and 40 seconds after the death of Mohammed's son Ibrahim. But the world's first Muslim didn't believe that eclipse was a sign from God. Instead, according to Islamic texts called the Hadiths, Mohammed proclaimed "the sun and the moon do not suffer eclipse for any one's death or life."

.

King Henry's Eclipse

When King Henry I of England, the son of William the Conqueror, died in 1133, the event coincided with a total solar eclipse that lasted four minutes and 38 seconds. A history by William of Malmesbury recounts that the "hideous darkness" agitated the hearts of men. After the death, a struggle for the throne threw the kingdom into chaos and civil war. [See Total Solar Eclipse Photos]

.

Einstein's Eclipse

While the ancients viewed eclipses as signs of greatlb_icon1.png acts of God, physicists viewed the 1919 solar eclipse as a triumph of science. During 1919's epic eclipse, in which the sun vanished for six minutes and 51 seconds, scientists measured the bending of light from the stars as they passed near the sun. The findings confirmed Einstein's theory of general relativity, which describes gravity as a warping of space-time.

==

> http://www.livescience.com/24743-famous-solar-eclipses-history.html

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STOCKS Vulnerable, here in May : It is possible a Top is in place

This could be a great set-up for a deeper slide

 

Here's 6mos SPY ... update

SPY-6mo_zpso61ehjbf.gif

 

My e-wave numbering shows a possible "failed 5th" e wave

May have ended this week.

For a while it looked like an "island reversal" might have been left at the end of the e wave up.

But during the day the market rallied to close the gap

 

SPY - 10 days

SPY-10d_zpssddiwtpw.gif

 

I suppose that was nearly inevitable, so long as there was no more bad news,

BECAUSE the gaps tend to suck energy out of the market.

 

Here's a comment from Tony C after yesterday's close

 

"The market gapped down at the open today, traded down to the 2085 pivot, then reversed back up to close the gap at 2105, before ending the day at 2099. Despite the rally, today was the second negative close in a row. Yesterday the market closed at the low of the day. Today it closed under SPX 2100. While the market can still challenge the OEW 2131 pivot to complete the diagonal. It could just as easily head lower from here as well. The choppy market continues. Short term support remains at the 2085 and 2070 pivots, with resistance at SPX 2120 and the 2131 pivot. Short term momentum nearly made it back to neutral after today’s extreme oversold reading. Best to your trading this day traders market!"

> https://caldaro.wordpress.com/2015/05/12/tuesday-update-489/

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More chart evidence of a Change in Trend after the "MOMA" /Moment of Max. Apathy* (GLD-to-TLT) Ratio

 

MOMA-6mo_zpscqj13pj1.png

 

The very recent break of the 21d MA over the 76d MA is a confirmation of a Change in trend.

And this may be an early signal that Gold may soon break out of its downtrend

 

Here are the raw figures:

GLD : $114.50

TLT- : $119.84

Ratio : 0.955 : GLD is just 4.5% below TLT

====

If the ratio exceeds 1.000, that may be another sign of stronger gold, and a possible breakout

 

GLD vs. TLT / from the 2008-High3 ... update / start-3/17/08 : GLD : $99.17 / SPY : 128.30 / r:0.7730

GLD-toTLT-2008-3H_zpsikqwnsph.gif

 

This may be a better chart, since it starts with GLD and TLT near the same level; $93.

If/when the two lines cross again on this chart, then GLD will be moving above TLT

 

TLT vs. GLD / "same start" .. update / start-2/21/08 : GLD: $93.25 / TLT: $92.55 / r:1.0076 (SPY: 134.79)

TLT-vs-GLD08-Feb21_zpstlcaabgh.gif

 

=== ===

*I have coined this term, MOMA / "moment of max. apathy" for the GLD-to-TLT down-to-up turnaround at 0.84.

MOMC/ "moment of max. complacency" would be the Gold-to-TLT ratio near 8.50

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MONEY Has to go somewhere - A look at three key asset major classes

 

Gold, Bonds, Stocks ... update- from 11/4/2007 :: Four, w/OilB : 5/ w/DXY

TLT-vsGLDxSPY2_zpsmqwbh13k.gif

 

+ In March 2009, people were worried about a Depression

+ In August 2011, people were worried about inflation and money exiting the USD

+ In March 2015, there was massive complacency, and people were rushing into USD assets,

like stocks and bonds

 

5 Assets / DXY (the USD etf, basically moves up and Down with Bond, and Oil falls help TLT & DXY

TLT-vs4assets_zpsxouoiua4.gif

 

One thing that could help trigger another rally in the USD /DXY... and TLT /Bonds, would be a drop in Oil prices.

That might also drag Gold lower, and could ultimately lead to a Lower "Max Apathy" point. So watch Oil !

(Note: OILB : is the etf for Brent Crude, which is probably now the best benchmark for world oil prices, not WTI.

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Silver (+$0.62) and Gold ($21) - are looking good today (as I had expected !)

But I do mind the gaps, since these gaps nearly always get filled (eventually - but we could get 3 gaps first)

SLV ...update

SLV-6mo_zpsic3wx2ve.gif

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"... seemed like max pessimism.. but was hard to pull the trigger!!"

Haha. I know the feeling.

Since I only bought just over half of the number of Calls I intended to.

Pessimism? Yes. Towards Gold and Silver markets.

And complacency (or apathy) about financial risks.

 

A Good day for the precious!

SLV- : +3.42%. on 17.3 mn vol.
GLD : +1.79%, on 11.5 mn vol.

Looking like the break out I was hoping for

 

GLD-12mo_zpsjpmnmens.gif

 

The gap does worry me a bit, since these gaps typically get filled.

But less often with SLV and GLD than with SPY

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"... a great call, gap or no gap" - DrB's Diary

Thanks.

That gap may help create an entry later on... (or not.)

(I even considered taking profits on a portion of my position yesterday. But in the end, I held it.)

I now think that a 3-gaps to the top type movement could be a possibility, and if we see that,

I would have regretted selling anything.

 

If you have been monitoring the GLD / TLT ratio, look what happened !

 

GLD-toTLT2_zpsxi8bqnyg.gif

 

That brave leap above the Bollinger Band is rare, and may be another sign that an important trend-change is underway.

The Ratio may wind up "riding the upper Bollinger band" to a much higher level, as it did in the prior green-circled area in 2012

 

Gold - 20 year chart ... update

Gold_zpszszztsyb.png

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TONY C on Bonds:

=====

"Once the 30YR yield (TYX) rises above a previous high (4%)... the bear market in yields is over"

 

TYX_zpssdreptl4.gif

 

Bond yields tend to move in 34 year cycles and there is very little sound data to go on much past the last 50 years, comparisons between the two maturities are limited to the 1981 yield peak. Then the 10YR and 30YR peaked within weeks of each other in the fall of 1981. They, amazing as it may sound, have been gradually declining for the past 34 years. When one considers the peak 30YR yield in 1981 was 15.21% and the recent low was 2.23%. It is quite clear, on average, yields do not move much at all. When compared to the stock market, for example, the DOW has risen from 1,000 to 18,000 during the same period.

30yr.png?w=640&h=485

. . .

During the entire decline from 1981-2015 the 30YR yield has made a steady series of lower highs. In fact, every high in yield has run into resistance at the monthly 89EMA. Notice how yields have risen into that EMA, get slightly above (less than 50 bps), then immediately reverse. The current level of the EMA is 3.63%. Since this EMA has been declining steadily over the years, the high points in yield have been declining steadily too. What this suggests is once the 30YR yield rises above a previous high, the recent high was 3.98%, the bear market in yields is over. And a new 34 year bull market in yields in underway.

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APATHY? Who caused Apathy? (say Draghi and Yellen)

 

The crash must be getting close...

Since Draghi is sounding a tardy warning, and pointing the finger elsewhere

 

A 2015 version of "Irrational exuberance"?

 

Draghi warns central banks against "blind" risk-taking - FT, pg.1

 

ECB president to danger of financial instability and inequality

===

+ Draghi warned central banks that mass bond-buying will worsen instability, inequality

+ Apparent "success" should not blind people to consequences on risk-taling behavior

: "...it is important that those consequences are identified, weighed, and where necessary integrate"

+ CB's have faced criticism that their response is stoking asset bubbles

===

Wow! Will people fall for this "projection" by Draghi?

He is warning people against the very behavior his actions have helped to inspire.

Incredible! It is like the Meistro-of-Money printing (Greespan) warning people against

the "irrational exuberance" he did his best to inspire.

I know a devil when I see one !

. . .

Meantime, back in the markets, Tony C flashes a RED LIGHT warning !

 

An End to the long Stock Rally?

 

Tony C has finally posted a "e?" on his chart / That might mean a possible end to the rally

 

SPY-TC_zpswwzs81e4.png

 

His comment:

" With today’s rally we stretched out the upper trend line on the hourly chart, and it now crosses at SPX 2130. Allowing for some potential overshoot in the ongoing diagonal triangle scenario, we feel the upper limit of this uptrend is the OEW 2131 pivot range (2124-2138). Anything more than that and we would be forced into looking for an alternative pattern.'

 

> https://caldaro.wordpress.com/2015/05/14/thursday-update-478/

=== ===

 

I also note that this rally has come with light volume ... SPYvsIWM : SPY : IWM : XLF : Nasdaq

SPY-vsIWM_zpsg3oas0oe.gif

 

... and that the triple-top in SPY has not been confirmed by the lower high in IWM

 

What happened to SVR?

(SPY): 212.21 +2.19 / (VIX): 12.79 - 1.02 = SV-ratio : 16.59, up from 15.20

And the SPY - Sep.$215p closed at: $9.70 -9.91 (mid: $9.80)

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A concerted attack on the asset bubble by those who created it?

Projection by Ms Yellen?:

Rising bond yields challenge US valuations - FT, pg.22

 

As the rate environment changes, companies will need stronger earnings growth

 

+ In its seventh year, the run certainly looks mature

+ The S&P "loiters just shy of record territory... less than 2% higher for the year"

 

Yellen made two comments:

+ Valuations in the stock market are "quite high", and

+ She warned of a "sharp jump" in longer term yields

 

"The problem markets face just now is that sovereign interest rates are rising"

"P/E ratios fell to single digits in the late 1970's and early 1980's when 10 year bond yields soared"

=== ===

 

Posted on Tony C's Blog: for Thursday

======

BenBernanke31.jpg

 

Apathy? What Apathy? This is disgusting!!
After: Negative interest rate, a high in global bond markets, and some new records in many equity markets, and sharp selloff in global bonds, what do we get...?
Warnings - from Janet Yellen and Mario Draghi about possible asset bubbles:
http://www.greenenergyinvestors.com/index.php?showtopic=20038

Elite bankers are up to their old tricks, of projecting all their sins onto others. So we hear Draghi warning Central bankers about "being blind" to risk. And he says: "It is important that these consequences are identified, weighed, and where necessary, integrated." Sure. Why didn;t you close the barn door before the horse bolted, Mario? And Janet's just as bad. Equity markets are "quite high," she says. And there could be "a sharp jump in longer term yields."

Thank alot. I thought it was YOUR job, as leading central bankers to warn people of the dangers of drinking too much and take away the punchbowl at the right time. Instead, they are now preaching sobriety to a room of drunks. Let's not forget whose handiwork this mess is. And whom to blame when people crash their cars on the way home from the party.

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Rick Rule here makes an argument in favor of Gold versus T-Bonds

 

http://www.kitco.com/news/video/show/Kitco-News/983/2015-05-15/Rick-Rule-Would-Throw-In-The-Towel-For-Gold-When

 

With bonds, you get "Return-free Risk", and no protection against inflation.

 

"You will get your money back, but you already have your money,

the problem is... You get nothing against inflation"

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People are waking up -- and seeing the TURNS may already be in place

 

MAMA-06_zpshvktykyl.gif

 

FT May 18th - Screeching U-turns on bonds and greenbacks

.
Screeching U-turns are underway in hedge funds and economic departments across Europe and the US. The biggest bit in the world has gone into reverse, and a lot of money has gone with it. The plummeting value of bonds, and so soaring yields, has seen drastic moves in German Bunds in the past month, and while the belief in a strong dollar as been battered as the euro leapt.

. . .
The leading S&P group ytd is gold mining, up an astounding +47% ytd... That is a function of the S&P group components, the GDX etf is up +13% ytd, but that is +10% ahead of the S&P500. We continue to recommend the purchase of gold mining shares, which are emerging from a four-year bear market...

- The Belkin Report, May 18, 2015

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SLV / Silver etf - Mind the Gaps ! : 10-days : 6-mos / GLD: 10-days : 6-mos / GDX: 10-days : 6-mos / GDXvGLD

 

SLV_zpsfyffatoz.gif

 

I did ! I counted 3-gaps... and I chose not to be "wedded" to my position, despite the set-up I like so much for Gold.

And so I sold my July-SLV calls for a 50%+ profit, and June-GLD calls for an larger profit

 

I will probably be seeking a re-rentry point after a decent correction.

 

The lack of "impulse" power in this move, and the declining volume as SLV rose were other factor in the decision to take profits.

As were the weaker GDX versus GLD. In short, there seem to be too many "clues" that this move was weak.

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We have seen Apathy in other areas too, as Max Igan points out

 

Apathy Is Terminal- Max Igan (Full)

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Thanks to CMJ

 

 

 

This is HOW People Will Lose EVERYTHING -- Bill Holter

 

 

Watch the Credit Markets where "all hell is breaking loose"... with "two major meltdowns"

 

BUNT (German Bonds 3X) versus TLT ... update

BUNT-etc_zpsojgsk7ml.gif

 

(Note how Bunt peaked as TLT made a "right shoulder")

 

"There is no white knight left" / "The Fed is out of bullets"

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Where's the Money been going as it fled from Bonds?

 

Answer: Into Stocks ... TLT -vs-SPY and GLD

 

TLT-spx-gld2_zps1telzmtb.gif

 

So if stocks peak, it may head back into Bonds and Gold

 

SPX-toTLT_zpspb9faglf.png

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