The bond market has collapsed so badly in recent months that dealers no longer make any effort to mask their pessimism. Requests to discuss the bond market with traders are met with such responses as: Call back next year. What bond market? Or, are you wearing a life preserver?
''The bond market today is in the greatest bear market in the history of the United States,'' said Seth Glickenhaus, director of Glickenhaus & Company, investment advisers, and a bond trader for 40 years.
''We will not buy a bond beyond a five-year maturity for our clients, except for speculation purposes. Anyone who buys a bond today to hold for more than five years is out of his mind and you can quote me on that.''
Double digits at least for a day--10.03 (4.27.16 close)--the 200 day MA is 10.24. We closed a gap from early Sep 2014 (all of this from the weekly chart). Note, also, there is a gap recently starting around 9. Looks like a likely area to be filled on the coming pull back.
So we are off the leper colony island that we have been on since 2014 in BGEIX--I've shuttled over $40K during this rally into Capital Preservation Fund. Yes I would buy a little back,around the gap below 9. Does taking profit mean I have to turn in my special tinfoil hat?
Seriously, I would always keep 25% in BGEIX in non-crazy times--I've got more now--and even in the stratosphere I can envision holding some; cutting back to 5-10%. I'm not insane like the bankstas who worship reward free trashuries and other dirt nap instruments of death that they foist upon us!
Well, the ole air came outta the balloon--as we head toward that 9 gap. Never a dull moment. If you chart SLV and BGEIX on the stock chart site, they look like twins. Of course nobody can read the future, but one thing that is guaranteed in miners is extreme volatility.
Date Price % Gain Date Price % Gain Date Price % Gain
2009-09-02 14.37 9.14%
1998-09-04 3.37 9.26% 1998-10-05 4.29 27.55% 1998-12-04 3.61 7.13%
2008-12-10 9.29 9.64%
2016-06-03 10.49 9.73% 07/05/16 ? ? 09/03/16 ? ?
2000-02-04 3.34 9.96% 2000-03-06 3.04 -9.06% 2000-05-04 3.00 -1.30%
2008-09-12 10.39 10.18%
2008-11-13 7.42 12.02%
2008-10-28 6.22 12.83%
2008-10-29 7.04 13.25%
2008-11-04 8.16 13.78%
2008-10-08 10.38 13.93%
1999-09-27 4.35 19.21% 1999-10-27 3.64 -16.27% 1999-12-27 3.48 -4.56%
2008-11-21 7.64 24.47%
Don't even consider buying BGEIX over 6--just wait--if it never goes under 6 again, be happy.
In the twelve years between 5/28/2004 and today 5/27/2016, BGEIX has been under 6 on 104 of 3021 trading days. That is 3.4% of trading days. In late May of 2004, gold was under $400 per ounce and BGEIX was still well above 6. In fact, there were 2 days of the 104 under 6 for BGEIX that were in 2008--the rest were in the current period of misery, 2015-2016. Take a look in the charts and confirm, that just about all trading experience that could occur has happened over that 12 year period for BGEIX.
The low was 5.51 on 10/27/08 and that was surpassed by the dividend adjusted low of 5.26 recently. There are no magic numbers for gold or BGEIX--there is only firm support AT zero for EVERYTHING, but at least increase your chances of success by buying this only when it is at extreme lows. Pleasant holiday WE to all!
Special update--whoops :)--oh well--at least we took off a lot of risk in front of the Fraud Fed's Minutes. In the grans scheme of things, the Fed manipulates everything and remember that gold stocks have that pesky "stock" moniker attached to them.
See weekly candlestick chart for BGEIX at sharpcharts
What is a 'Hanging Man'
A hanging man is a bearish candlestick pattern that forms at the end of an uptrend. It is created when there is a significant sell-off near the market open, but buyers are able to push this stock back up so that it closes at or near the opening price. Generally the large sell-off is seen as an early indication that the bulls (buyers) are losing control and demand for the asset is waning.
Buy back area 7.5-9? We shall see. Nobody KNOWS the future.
"Gold has been backing off with the prospect of rising interest rates, but a weekly closing below 1225 will signal that the high is possibly in place. However, a weekly closing below 1205 will signal that a serious decline is likely. Technically, we can see critical points at 12434.47 and 1202.13, and a closing below 1202 will signal serious trouble for gold. Gold needs to close above 1265 today to keep it alive near-term. Closing below that price level is neutral and a close below 1230 is bearish just from a tech perspective. A close beneath 1225 will warn correction ahead.
To answer all the questions coming in how the gold promoters are burning people at the stake, they cheer every rally. They never say sell. It is always the same thing – up, up, and away no matter what else is happening in the world. They pitch each time this rally is real but lack any sense of where gold fits within the global scheme of market movement. Everything has its time and place. Gold will breakout, but it requires the collapse in public confidence. We are just not there yet. Trump and Bernie illustrate that this is coming.
Nothing has taken place to negate the prospect of new lows. Markets typically have to move to extremes on both sides to trap people. That is the character of markets – ALL MARKETS. It is human nature we are talking about. My dispute with gold promoters is that they use the same nonsense stock brokers did during the Great Depression – just buy and hold, it will eventually make new highs. In the case of the Dow, it took 25 years for 1954 to exceed the 1929 high. In real terms, it was 1966 adjusted for inflation that produced new highs."-M Armstrong
Not only should the Greek Government (and the US Government, for that matter) be in prison for these acts of fraud but so should those who advocate for and wish to assist in promulgating and hiding even more of it.--1 through 4 from market-ticker website
"When the "melt-up" phase ends, history indicates that the decline should be quite horrendous and go back down to a 92-96 index sell signal that ends the 92-96 index's bull market buy signal from January. And then another rise is supposed to occur because the very long-term indices are bullish. Long-termers can remain bullish, but very few people will have the stomach or the desire to remain long during a major decline (that should exceed most analysts' expectations) when the melt-up phase ends and the gold stocks decline into a 92-96 index sell signal over months."--Jeff Kern from the 321gold site.
94 day moving average on the daily chart for BGEIX is at 7.61 (5.6.16 close). That would be a 2/3 fib retrace of the entire move up--not unheard of but certainly requiring of a "stomach." That would take us well below that below 9 gap on the weekly BGEIX chart.
That gap on the weekly chart around the April 4 2016 week looks inviting after we have now broen through the 200 day moving average. Well, for bulls it is not very inviting, but there will be a correction at some point and that will be likely the stopping place of LEAST damage.
The gap between the April 4 and April 11 weeks is just below 9. We are sitting at over 10.50 to end April..
To break the world monetary system, that will ONLY take place with a rising dollar. But with a declining outcome thereafter. You are just missing that part that FIRST the dollar must soar to screw up the world to create the change in the monetary system and that illogical proposition is in fact what makes it happen. Forget about petro-dollars. They are history. ..
Don’t worry. Just go with the flow. It’s happening fast. Just let go off the old-world theories. The reserve status of the dollar cannot be changed by pricing oil in even rubles or yuan. The reserve status is created by the fact BIG MONEY can park in US debt. It cannot park in European debt which remains in chaos outside of Germany. Britain, Canada, Australia are too small, Japan is too restrictive, and China as well as Russia are not quite ready for prime time. The debt has to turn belly-up in the fish bowl to change reserve status. It is not even something the USA, China, or Russia can decree.--M Armstrong
Sold and selling more today--from Jeff Kerns about nails it:
"When the "melt-up" phase ends, history indicates that the decline should be quite horrendous and go back down to a 92-96 index sell signal that ends the 92-96 index's bull market buy signal from January. And then another rise is supposed to occur because the very long-term indices are bullish. Long-termers can remain bullish, but very few people will have the stomach or the desire to remain long during a major decline ..."
92 day moving average on the daily for BGEIX is 7.93 as of 5.16.16. We closed at 10.45 that same day. That would be a 25% decline from yesterday, but just like with the ratio plunge--the miner moves tend to overshoot! Time to shut up and let the market work its magic, whatever that is--will check back nest week.
"Gold settled down Friday for its eighth consecutive day following comments from Fed Chair Janet Yellen that highlight the prospect of a rate hike in the next few months.
In a conversation with Gregory Mankiw a macroeconomist at Harvard University, Yellen said that if the U.S. economic growth continues to build momentum, it could be appropriate to raise interest rates in the coming months."
Yep--in other news we gotta raise rates to lower them and we need to create mo money to save it!!
The gold stocks are already very overbought…and if they continue higher unabated, then we will have to worry about a potential sizeable correction. The chart below shows GDX’s parent index (GDM) along with two oscillators which plot its distance from its 100-day and 200-day exponential moving averages. The oscillators show the gold stocks are the second most overbought they have been in the past 22 years. The most overbought point was early 2002 when GDM corrected 37% before climbing much higher.
Before we worry about a sizeable correction, let me point out some very important data. The 2002 correction began when GDM and HUI rebounded 212% and 311% respectively from the major low in 2000. Thus far, the two have rallied 100% and 128% respectively.
Furthermore, the gold stocks are only three months removed from what could be the greatest buying opportunity of all time in the sector! While this is a sensational statement, it is rooted in data and facts and not your typical gold bug doomer porn. In short, there are three major similarities between the recent bottom in the gold stocks and the 1942 low in the stock market which arguably proved to be the greatest buying opportunity ever.-Jordan Roy-Byrne-
Selling another $25K of BGEIX today. Still very bullish long term and still have plenty along with other miner related in the brokerage to take advantage of more extended move, but I have my doubts right now. No clue on the future--volatility is indeed increasing.
The sad reality is that this is how governments get in trouble too. It's how Detroit got in trouble, for example -- they promised to pay (via issuance of bonds and pension obligations) predicated on tax revenues that had no hope, given the arithmetic, of being able to be realized. That's fraud.
Greece got in trouble the same way. They issued billions of Euros worth of debt far beyond their ability to tax in the present or reasonable future -- that is, by the time of the bond's maturity -- to ever pay the value of said bonds back.
When the markets called their bluff they suddenly had a big problem.