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Goldhedge

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Yield Curve Inverts For The First Time Since 2007: Recession Countdown Begins

by Tyler Durden
Fri, 03/22/2019 - 09:46


Update: The most prescient recession indicator the market just inverted for the first time since 2007.

Don't believe us? Here is Larry Kudlow last summer explaining that everyone freaking out about the 2s10s spread is silly, they focus on the 3-month to 10-year spread that has preceded every recession in the last 50 years (with few if any false positives)... (fwd to 4:20)
 

Goldhedge

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Ok, here's a question for the folks here...

Clive Maund recommended TRX awhile back in mid January. As you can see from the chart it 'popped' up 50%. Today he writes:

TANZANIAN ROYALTY EXPLORATION Update...
March 17, 2019
by Clive Maund
Tanzanian Royalty is a good performer technically and we have traded it well, buying it on the 20th January, scaling back positions when it got very overbought on 29th January, bought back what we'd sold at a better price on the 8th February, scaled back positions again on the 15th Feb. after another rally, and bought it back after another dip on 22nd Feb. As you will see on its latest 3-month chart shown below. We could have done what we did on two prior occasions and sold some at the late February peak and bought back on the dip to the lower boundary of the range about a week ago, but we never got round to it, and also because there is an increasing risk that such aggressive trading will result in missing "The Big One" which is where it breaks out of the top of the pattern to commence its next upleg.

Speaking of upside breakouts, Tanzanian Royalty now looks about ready to break out of this trading range and embark on the next upleg, which is likely to be big and could be huge if the deep drill rig now working its way through the planned open pit at Buckreef to probe what lies beneath strikes it rich - if it does we could be looking at a world class gold mine here, and at a time when the long sector malaise is coming to an end. The technical chart setup looks very positive indeed as we can see on the range of charts presented below. The upward skew of the current trading range makes it a very bullish "Running Flag", an interpretation that is supported by the now strongly bullish volume pattern, with volume having ebbed away to a low level as the Flag pattern approaches completion. The duration of this Flag has allowed the overbought condition of various oscillators resulting from the spike higher in January (which we rode) to almost fully unwind, and the rising 50-day moving average to almost catch up with the price, which means that the stock is "gassed up" for the next run.
Now I ask you is this him pushing TRX? Apparently, he has a lot of 'followers' (subscribers) because it seems his recommending TRX is causing this.

2019-03-22_1355.png


There's a small gap right at the beginning of the first rise (arrow). Do gaps 'fill' or is that an old wive's tale?

PS I'm not a subscriber... just follow Sinclair who posted this.
 

dpong

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Here's a different view of TRX, even more dramatic looking, I think. As to the gap, my opinion only. It is a runaway gap, and can be safely ignored at present. TRX could go down there, I suppose, but not because of that gap.

sc-6.png
 

jelly

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Great choice, jelly!

I have been loading up on AG the past few years. When silver get past 22 fiats, LOOKOUT!
Its the foundation of my portfolio. I even have some 2 year call options on it. I think this puppy will fly when silver gets back on it's feet. First Majestic has built up one hell of a silver company during the past 4 years.
 

Zed

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Getting to the top of the BB's, so, reaction and test of 1300 OR do we go for a higher high and crack that 1340 level. Failing a test of 1300 would start to look like a lower high is in place here and that a longer correction is in play. ABC correction could mean ~1260-40 area.

AU-D-20190326.png
 

Goldhedge

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Clive Maund recommended TRX
Sinclair has a video and Bill Holter covered where there's evidence that TRX is rising because of short covering...
 

Zed

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... and we are back, +1% yesterday and +3.5% today on the ASX goldies.

Hmmmmm, nervous choppy trade.
 

Zed

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Sinclair has a video and Bill Holter covered where there's evidence that TRX is rising because of short covering...
Isn't the short interest reported? We get a daily report so you can see if its falling or rising. 2c FWIW.
 

Zed

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Zed

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Just pulling back to the monthly view for a moment. 20MMA rose over the 50MMA in May 2002 pretty well @ the beginning of the first major up leg in gold (A wave or wave 1). The MA's lag @ the end of the leg so they are not really useful other than historical interest HOWEVER the corrective leg is apparent from the 2011 high. That is a B wave or wave 2 down. Wave C or wave 3 would seem to have been confirmed by the MMA's crossing upward again.

Wave 3: Wave three is usually the largest and most powerful wave in a trend (although some research suggests that in commodity markets, wave five is the largest). The news is now positive and fundamental analysts start to raise earnings estimates. Prices rise quickly, corrections are short-lived and shallow. Anyone looking to "get in on a pullback" will likely miss the boat. As wave three starts, the news is probably still bearish, and most market players remain negative; but by wave three's midpoint, "the crowd" will often join the new bullish trend. Wave three often extends wave one by a ratio of 1.618:1.

Wave 3 is normally the "mark up" wave, this is where the "solid money" is made and the price is bought back into line with fundamental value. Typically institutions start buying this wave and volume expands enormously... smart money sells the end of this wave. For the conservative, the next 2/4 year period (typically shorter than wave 1/A) is a solid safe gain. Then we do a major correction or wave 4 (D some use letters!), after this the institutions push the idea to the public and we get the last up wave. This is the mad money and where the institutions are the sellers and the public get greedy. It can be a short volatile, rocket ride... yes, on paper you can make more by hanging on to the end BUT it is @ considerable risk. If you stay the course to the end you want to have converted your physical gold into some other investment by end of wave 3 (there will be something way undervalue by this point) and be playing the last phase with"play money" in very liquid gold related paper that allows a fast exit.

Anywhooo... my point is ---> IMO here comes the money maker, enjoy the ride but start looking for your next major investment move as we are much closer to the end of the party than the start. JMO DYODD etc..

Just repeating the message for any newish participants here.

AU-M-20190327.png
 
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Zed

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PS> 1.618:1 yields a target of $3200. Conservative I think but then my targets of $4300 to $5400 are conservative according to many. If we see the $8000 to $10000 as touted it will be, IMO, a wave 5 blow off.

IMO before we see JS's 50K+ number new money will be issued. That is an end of the world as we know it number IMO and I don't see that being allowed to pass without a drastic response.

Sooooo... I've have gone from being "nuttily over the top" with my forecast to being "foolishly low", same happened to me in the .com boom. By the end I was the guy who just didn't "get it" after being the "vocal nutty bull" in the early 90's.... then the tech wreck came and everyone forgot everything that was ever said!

I have a similar feeling that the tide is turning and I'm about to be relegated to the "foolishly cautious" camp over the coming up leg.

Anyway... don't say I never mentioned my sentiment on the subject. Depending on the climate here I will probably come under attack again, a sure sign that it's a major upleg.

Stay grounded people.
 
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PS> 1.618:1 yields a target of $3200. Conservative I think but then my targets of $4300 to $5400 are conservative according to many. If we see the $8000 to $10000 as touted it will be, IMO, a wave 5 blow off.

IMO before we see JS's 50K+ number new money will be issued. That is an end of the world as we know it number IMO and I don't see that being allowed to pass without a drastic response.

Sooooo... I've have gone from being "nuttily over the top" with my forecast to being "foolishly low", same happened to me in the .com boom. By the end I was the guy who just didn't "get it" after being the "vocal nutty bull" in the early 90's.... then the tech wreck came and everyone forgot everything that was ever said!

I have a similar feeling that the tide is turning and I'm about to be relegated to the "foolishly cautious" camp over the coming up leg.

Anyway... don't say I never mentioned my sentiment on the subject. Depending on the climate here I will probably come under attack again, a sure sign that it's a major upleg.

Stay grounded people.
I would love to see gold hit $80,k to $120,k but it would take a massive tsunami for that to happen. Back in year 1980 Gold top, the world didn't flinch a bit. Today it is a global economy and who knows who are the participants jumping in the bandwagon; supposedly the world participate in this one. I would think the Feds have this under control once gold hit their softer targets on the upside so your numbers are more reasonable expectations.
 

Zed

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I would love to see gold hit $80,k to $120,k but it would take a massive tsunami for that to happen. Back in year 1980 Gold top, the world didn't flinch a bit. Today it is a global economy and who knows who are the participants jumping in the bandwagon; supposedly the world participate in this one. I would think the Feds have this under control once gold hit their softer targets on the upside so your numbers are more reasonable expectations.
I don't think I'd like a world with 120K gold....
 
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I don't think I'd like a world with 120K gold....
Zed, I agree... that would be disastrous and I won't be able to feed my growing family. I wonder if the Feds would underestimate the power of the INTERNET trading by the World Participants that could pile all in. (that's up for debate). A very few people used the Internet back in 1980 and no one would have used it for anything at home other than making a rotary call to the office trading desk.
 
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Goldhedge

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Isn't the short interest reported? We get a daily report so you can see if its falling or rising. 2c FWIW.
Naked shorting gets reported??
 

savvydon

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Just pulling back to the monthly view for a moment. 20MMA rose over the 50MMA in May 2002 pretty well @ the beginning of the first major up leg in gold (A wave or wave 1). The MA's lag @ the end of the leg so they are not really useful other than historical interest HOWEVER the corrective leg is apparent from the 2011 high. That is a B wave or wave 2 down. Wave C or wave 3 would seem to have been confirmed by the MMA's crossing upward again.




Wave 3 is normally the "mark up" wave, this is where the "solid money" is made and the price is bought back into line with fundamental value. Typically institutions start buying this wave and volume expands enormously... smart money sells the end of this wave. For the conservative, the next 2/4 year period (typically shorter than wave 1/A) is a solid safe gain. Then we do a major correction or wave 4 (D some use letters!), after this the institutions push the idea to the public and we get the last up wave. This is the mad money and where the institutions are the sellers and the public get greedy. It can be a short volatile, rocket ride... yes, on paper you can make more by hanging on to the end BUT it is @ considerable risk. If you stay the course to the end you want to have converted your physical gold into some other investment by end of wave 3 (there will be something way undervalue by this point) and be playing the last phase with"play money" in very liquid gold related paper that allows a fast exit.

Anywhooo... my point is ---> IMO here comes the money maker, enjoy the ride but start looking for your next major investment move as we are much closer to the end of the party than the start. JMO DYODD etc..

Just repeating the message for any newish participants here.

View attachment 127220
This is a great post, Zed. I think you have hit the nail pretty close to the head standing back and looking at a medium to long term picture. Feels like this is right about where we currently are.
 

savvydon

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PS> 1.618:1 yields a target of $3200. Conservative I think but then my targets of $4300 to $5400 are conservative according to many. If we see the $8000 to $10000 as touted it will be, IMO, a wave 5 blow off.

IMO before we see JS's 50K+ number new money will be issued. That is an end of the world as we know it number IMO and I don't see that being allowed to pass without a drastic response.

Sooooo... I've have gone from being "nuttily over the top" with my forecast to being "foolishly low", same happened to me in the .com boom. By the end I was the guy who just didn't "get it" after being the "vocal nutty bull" in the early 90's.... then the tech wreck came and everyone forgot everything that was ever said!

I have a similar feeling that the tide is turning and I'm about to be relegated to the "foolishly cautious" camp over the coming up leg.

Anyway... don't say I never mentioned my sentiment on the subject. Depending on the climate here I will probably come under attack again, a sure sign that it's a major upleg.

Stay grounded people.
Then there is that sexy, sleazy biatch silver... I would think that during a wave three we might expect the GSR to fall down toward the 50-60 range. During a blow off wave 5 we could make it to 30 or even 20. Seems like even in the most conservative scenario silver blows through it's old $50 lid.
 

Zed

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Then there is that sexy, sleazy biatch silver... I would think that during a wave three we might expect the GSR to fall down toward the 50-60 range. During a blow off wave 5 we could make it to 30 or even 20. Seems like even in the most conservative scenario silver blows through it's old $50 lid.
Yeah, the touted 15 could be a blow off high ratio.
 

Zed

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Zed, I agree... that would be disastrous and I won't be able to feed my growing family. I wonder if the Feds would underestimate the power of the INTERNET trading by the World Participants that could pile all in. (that's up for debate). A very few people used the Internet back in 1980 and no one would have used it for anything at home other than making a rotary call to the office trading desk.
The internet has amplified all financial trends in the last 25 years. Access is very definitely a factor so yes if anything this will see much broader participation than it would have in the past. Veteran traders complained in the 90's about new traders with internet accounts screwing up all the old technical patterns by trying to be a T/A based traders. It was real, it changes the game, in the end the market discounts all knowledge so the spread of knowledge changes the game. Things work until too many people/machines are working that way... then things change. Machines reacting to of machines 'learning' at light speed will be very interesting indeed!

It's a brave new world.
 

louky

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Yield Curve Inverts For The First Time Since 2007: Recession Countdown Begins

by Tyler Durden
Fri, 03/22/2019 - 09:46


Update: The most prescient recession indicator the market just inverted for the first time since 2007.

Don't believe us? Here is Larry Kudlow last summer explaining that everyone freaking out about the 2s10s spread is silly, they focus on the 3-month to 10-year spread that has preceded every recession in the last 50 years (with few if any false positives)... (fwd to 4:20)
 

Zed

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Yes... Dent is going off about it.
 

Strawboss

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Looks like TIMBER is approaching for the SPY...
 

jelly

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Oil is starting to look like its rally since december is starting to peter out. might be up for a correction soon...
 

Goldhedge

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Happy Gold Bank Asset Tier 1 day. Apparently, the central banks of the world have just officially figured out what we all already know around here - Gold is Money.
Just like women... always changing their minds...