Bulls Getting Caught In The Whirlwind

Volatility

volatility index

The VIX open within the body of Friday‘s candle (harami position) didn‘t bode well, and volatility having closed significantly above Friday‘s open, attests to the strength of yesterday‘s move. This spike doesn‘t appear as over yet.

Gold, Silver and Miners

gold, HUI and TLT

Gold and miners are in a vulnerable position, and consolidation of recent sharp gains would be healthy and desired. The volume in both gold and silver shows the sellers don‘t have enough conviction, and pullbacks remain buying opportunities regardless of the threatening nominal yields move (inflation expectations made a similarly sharp uptick yesterday).

gold, miners and copper to 10-year Treasuries yield

The weekly chart shows how little has changed, how minuscule power has been sapped yesterday. The upleg across the precious metals remains alive and well as we aren‘t crashing into deflation.

Bitcoin

Bitcoin and Ethereum

Bitcoin reverted back below the 50-day moving average, and neither Ethereum is crashing. The technical outlook is though turning neutral, and the bulls will have to prove themselves. Until prices return back above the blue moving average, Bitcoin remains short-term vulnerable.

Summary

S&P 500 got under selling pressure that is showing no signs of abating, yet the weakness remains concentrated in quite a few tech names. Besides these, credit markets aren‘t doing fine either.

Gold, silver, and miners continue being resilient, and the coming correction would likely be a shallow one. Increasing nominal yields are countered by rising inflation expectations and copper prices, helping to keep the metals out of harm‘s way.

Crude oil bulls will have to step up to the plate and defend the unfolding upswing that‘s threatening to crash below the recent lows.

Bitcoin is getting sold off today as well, and the bullish to the neutral short-term outlook of yesterday is turning to a neutral one as a minimum.

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