Tech Holds The Key To S&P 500

Gold, Silver and Platinum

gold and Treasury yields

True, gold‘s yesterday‘s candle leaves much to be desired for the bulls, but once again, we‘re seeing a clear refusal to move down even as Treasury yields continue to plunge. It‘s still a valuable first swallow, and more has to follow. Gold isn‘t getting anywhere in today‘s premarket while silver, copper, oil and soybeans are all up mildly. Agrifoods reached a new 2021 high yesterday – commodities clearly like and anticipate the inflationary Fed speak message they get.

gold, silver and platinum

One look at the precious metals group – gold the laggard, silver leading, and platinum even more so – check out on the caption when the latter decoupled – 2 weeks before silver did. The anatomy of the unfolding precious metals upleg goes on in this predictable fashion, where platinum has the power to keep running more along the lines of commodities such as copper. That means powerfully.

Yesterday‘s watchout though are the miners, which dragged down both the HUI:GOLD and GDX:GLD ratios – not below their lows, but still. A great illustration of the yellow metal‘s woes, and low credibility of its yesterday‘s candle with a sizable lower knot.

Summary

Stock bulls are far out of the woods yet, and technology stabilization must kick in first. Little proof thus far it‘s there, and I view the rising rates as starting to bite the stock market too.

Gold and silver also got under the Powell pressure yesterday, and haven‘t escaped the confines of Treasury yields pressure thus far. The markets are clearly wary of the testimony‘s part II still.

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Monica Kingsley 2 months ago Author's comment

Technology holds the key to stocks - and keeps acting rather weak. Rising rates are starting to bite SPX and financials won't save it, and healthcare needs to catch its breath too. Value can't simply carry the full weight.

I was not persuaded by yesterday's gold price action, tweeted mightily - the first swallow of real, directional decoupling from TLT has to prove itself, and it's getting challenged. Amid mildly positive commodities and the dollar going not much anywhere, the gold jury is still a little out while silver and platinum can attempt another run.

It looks like gold can attempt a daily recovery from the low $1790s now that silver reversed. Copper is strong as well, and oil is running. And the dollar? +0.20% won't cut it - too weak a reaction to TLT. The bond market isn't convinced...