(The Weekly Digest reproduces the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers. )
THE PERIOD LEADING TO THANKSGIVING IS TRADITIONALLY POSITIVE, GOLD NOT RESPONDING
November 22, 2013
Traditionally the period leading to Thanksgiving is positive both for stocks and gold. Stocks continue their march upwards, but this year gold is not responding. So far, overnight, all attempts to mount a rally in gold have failed. The main problems facing the gold market is the heavy presence of the momo crowd. The momo crowd is sitting on heavy unrealized losses in gold and silver. So far the momo crowd has mostly acted like a deer in the headlights. The risk of the momo crowd panicking and selling is increasing. If such a panic occurs, gold can easily fall to $1,000.
Interest rates that had risen in the wake of confusion at the Fed are beginning to retreat.
Oil is trying to mount a rally.
Gold futures are at $1245, silver futures are at $19.95, and oil futures are $95.40.
S&P 500 resistance levels are 1800 and 1825; support levels are 1775, 1766, and 1750.
DJIA futures are up 21 points.
CONFUSION AT THE FED, THE MOMO CROWD SELLS GOLD
November 21, 2013
A careful read of the FOMC report released yesterday shows that the Fed is clueless as the to the best way and timing of taper. The report reads like kindergarteners trying to figure out what to play, when to play, and how to play. This confusion at the Fed is increasing risks in the markets.
A logical beneficiary of the confusion at the Fed should be gold. However gold is mostly under the control of the momo crowd. The momo crowd is not known for deep analysis. For the first time recently, our algorithms are detecting selling in gold by the momo crowd. If the momo crowd panics, gold can easily approach $1,000 and even penetrate the $1000 mark. So we will have to observe carefully if the selling by the momo crowd yesterday and today turns into panic.
Interest rates are moving higher due to the confusion at the Fed.
Oil is moving higher.
Gold futures are at $1244, silver futures are at $1984, and oil futures are $94.10.
S&P 500 resistance levels are 1800 and 1825; support levels are 1775, 1766, and 1750.
DJIA futures are up 45 points.
FOMC MINUTES ON TAP, INFLATION UNDER CONTROL, AND GOLD FALLS
November 20, 2013
FOMC will release its minutes at 2:00 PM ET. This is often a market moving event. Please stay alert for opportunities.
October Core Consumer Price Index rose 0.1% compared to consensus of 0.2%.
October Retail Sales ex-auto 0.2% vs. 0.1% consensus.
Our algorithms are detecting aggressive gold selling by Smart Money this morning.
Oil is near unchanged.
Interest rates are slightly higher.
Gold futures are at $1262, silver futures are at $20.32, and oil futures are $93.60.
S&P 500 resistance levels are 1800, and 1825; support levels are 1775, 1766, and 1750.
DJIA futures are up 23 points.
A NEW DATA POINT SHOWS INFLATION IS UNDER CONTROL, RISK IN GOLD
November 19, 2013
This morning Employment Cost Index for Q3 came at 0.4% vs. consensus of 0.5%. Rising wages are a big contributor to inflation. Annualizing the Q3 data, wages are rising only at 1.6% per year. This poses a risk to gold. Traditionally gold is an inflation hedge. The momo crowd has become a big factor in gold trading and the momo crowd tends to buy gold on low inflation. This morning was no exception. Our algorithms detected heavy buying by the momo crowd after release of the data.
Interest rates are ticking up.
Oil is hovering around unchanged.
For the stock market, the probability of a melt up is increasing and so is the probability of a correction. In other words, the probability of a binary outcome here is fairly high.
Stock markets across Asia and Europe are generally lower.
Gold futures are at $1274, silver futures are at $20.35, and oil futures are $92.97.
S&P 500 resistance levels are 1800, and 1825; support levels are 1775, 1766, and 1750.
DJIA futures are up 12 points.
A HAT TRICK IS IN THE CARDS — DJIA 16,000, S&P 500 1,800, AND NASDAQ 4,000
November 18, 2013
The round numbers, especially on DJIA, tend to draw in retail investors. As retail investors rush in, the Smart Money tends to sell into the euphoria. This year there is more fuel in these round numbers because they are occurring in a strong seasonal period.
Of note is that many market internals that we monitor continue to weaken.
Our plan continues to be following the Taper Plan. We will continue to give priority to avoiding unnecessary risks and creating potential for huge losses down the road.
Gold futures are at $1278, silver futures are at $20.53, and oil futures are $93.42.
S&P 500 resistance levels are 1800, and 1825; support levels are 1775, 1766, and 1750.
DJIA futures are up 37 points.
