Christmas in July

307
Fri, Jul 29, 2016 - 9:47am

Well, we've spent the last two weeks making some bold predictions about the price of gold, the Bank of Japan and interest rates. Now here we are at the end of the month and things have unfolded almost precisely as we'd hoped. Won't it be fun to see what gifts August brings?

Time is short this morning such just a recap...

The BoJ did, indeed, "disappoint" overnight in the classic buy-the-rumor-sell-the-news style that we expected. The only oddity of it all was the almost NON-reaction in every other market. While the USDJPY fell over two points, S&P futures hardly budged, interest rates actually rose and the metals fell. HUH??

But all of that changed when the Q2 GDP numbers were announced earlier today and the "growth" shown was enough to even make Mr. Donut blush. Once again, all of the 8-figure WallSt dbs were off by an order of magnitude after predicting +2.4-2.6% and seeing the actual number come in at just a paltry +1.2%. The final level for Q1 was also cut back to just +0.8%. SOME ROBUST ECONOMY!

This finally sparked the metals as there is now hardly anyone left on Planet Earth who thinks that The Fed will raise rates again in 2016. All of this sets the stage for a return of Spec money and open interest to gold in August and, just as we've been forecasting, new 2016 highs.

And ponder this numbers as you go through the day...How many worthless blog posts and articles did you read in July that detailed how "the metals were overbought", "topping", "due for a pullback" and "ready to make new lows"? While 3-5% drops are never fun (yet part of the process), how about some month-end perspective:

Gold June 30: $1327 Gold now: $1351 Total change: +$24 or +1.8%

Silver June 30: $18.62 Silver now: $20.29 Total change: +$1.67 or +8.9%

Hmmm. Boy, that sucks. Just brutal. Those damn metals and all the charlatans that pump them. Gimme a break...

For the rest of the day, there's no sense in getting too worked up over the tick-by-tick stuff. Just let the day play out. The week will end and, more importantly, the month will end with green candles across the board and all of this sets us up for what should/will be a very interesting month of August. We've got another BLSBS next Friday and then that's about it. No FOMC till September. The BoJ is now done for a while. All that's left should be random datapoints and announcements that only serve to enforce the current environment of even lower rates and NIRP, strong metal demand and higher prices.

If you want something to pull for, keep an eye on gold. A monthly close north of $1350 would be nice. Perhaps more important is the Long Bond where a green candle and a monthly close above 173 would be cool. It closed June at 172-11.

Lastly, here are two bits of audio you might enjoy:

Have a great day!

TF

About the Author

Founder
turd [at] tfmetalsreport [dot] com ()

  307 Comments

  Refresh
ChaCha MarsTF
Aug 1, 2016 - 8:26am

Shanghai toying with paper gold?

Craig, you asked for a link; haven't had time to relisten to several hours of videos (where I first heard this), found these:

========== (1) ===========

www.chinadailyasia.com/business/2016-04/19/content_15419028.html

========== (2) ===========

[My Q: Wasn't SGE supposed to be 100% physical?]

96% of trades on the Shanghai Gold Exchange settled in physical ... www.usagold.com/.../96-of-trades-on-the-shanghai-gold-exchange-settled-in-physical... Jun 17, 2016 - 96% of trades on the Shanghai Gold Exchange settled in physical metal ... Shanghai benchmark influences derivative contracts within China.

========== (3) ===========

Shanghai gold exchange introduces new price index
Saibal Dasgupta
| TNN | Apr 19, 2016, 10.57 PM IST
https://timesofindia.indiatimes.com/world/china/Shanghai-gold-exchange-introduces-new-price-index/articleshow/51900005.cms

BEIJING: .... SGE said the present system of market pricing was inequitable and needs to be changed. "At present, China's gold derivatives market is lacking in an authoritative and equitable gold benchmark price which is denominated in renminbi," it said in a circular. "The launch of Shanghai Gold Benchmark Price will facilitate the development of China's gold derivatives market which will also have a big impact on the price of gold related financial products, wealth management products and derivatives," the circular said.

ChaCha MarsTF
Aug 1, 2016 - 8:26am

Shanghai toying with paper gold?

Craig, you asked for a link; haven't had time to relisten to several hours of videos (where I first heard this), found these:

========== (1) ===========

www.chinadailyasia.com/business/2016-04/19/content_15419028.html

========== (2) ===========

[My Q: Wasn't SGE supposed to be 100% physical?]

96% of trades on the Shanghai Gold Exchange settled in physical ... www.usagold.com/.../96-of-trades-on-the-shanghai-gold-exchange-settled-in-physical... Jun 17, 2016 - 96% of trades on the Shanghai Gold Exchange settled in physical metal ... Shanghai benchmark influences derivative contracts within China.

========== (3) ===========

Shanghai gold exchange introduces new price index
Saibal Dasgupta
| TNN | Apr 19, 2016, 10.57 PM IST
https://timesofindia.indiatimes.com/world/china/Shanghai-gold-exchange-introduces-new-price-index/articleshow/51900005.cms

BEIJING: .... SGE said the present system of market pricing was inequitable and needs to be changed. "At present, China's gold derivatives market is lacking in an authoritative and equitable gold benchmark price which is denominated in renminbi," it said in a circular. "The launch of Shanghai Gold Benchmark Price will facilitate the development of China's gold derivatives market which will also have a big impact on the price of gold related financial products, wealth management products and derivatives," the circular said.

hindsight101tyberious
Aug 1, 2016 - 5:44am
hindsight101
Aug 1, 2016 - 5:41am

I used to read Ed Steer fairly religiously...

...until his popularity lead him to become a pay site....

One pay site is about I want to try and keep up with and have selected this one.

The lopsided bullishness of the managed money is of concern to me, especially as I read reports about reduced physical demand from Asia and even in the States...

That physical demand from Asia better pick up here pretty soon in keeping with the seasonals or I suspect we'll have a heart breaking pull back.

hindsight101LostMind
Aug 1, 2016 - 5:35am

Lost Mind - agree there is something to learn here...

Duncan provides a different and clear view. If credit and liquidity continues to expand that is bullish for metals....and stocks. I have to believe that if the government expands its spending massively it will do so inefficiently. Inflation before deflation....I suspect his described path forward will be that adopted by the governments...the can will be kicked down the road....

James CrightonSaratogaPrepper
Aug 1, 2016 - 12:53am

Saratoga Prepper - 5:18pm post

Indeed - GPS co-ordinates too - very nice ! And warn of need for canoe?

jc

Key Economic Events Week of 8/10

8/10 10:00 ET Job openings
8/11 8:30 ET Producer Price Idx
8/12 8:30 ET Consumer Price Idx
8/13 8:30 ET Initial jobless claims
8/13 8:30 ET Import Price Idx
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Unit Labor Costs
8/14 8:30 ET Cap Ute and Ind Prod
8/14 10:00 ET Business Inventories

tyberious
Jul 31, 2016 - 11:25pm

Econocasts Trading

Econocasts Trading Models

2016.07.29 Nasdaq Cycle Model Chart

Posted: 31 Jul 2016 05:21 AM PDT

2016.07.29 Nasdaq Cycle Model Chart




















The Nasdaq cycle model phase shifted to the right since the last iteration in May, and now suggests a peak in the index at the beginning of September, 2016. A previous iteration of the model is shown below and here on the blog.




2016.05.28 Nasdaq Cycle Model Chart





tyberious
Jul 31, 2016 - 11:18pm

Hillary Cannot Possibly

Hillary Cannot Possibly Win

from Bill Still:

Still Report #1086 – Hillary Cannot Possibly Win
tyberious
Jul 31, 2016 - 11:12pm

La Plata

lol, maybe the bond vigilantes return.

Doubtful. All the current selling is being sopped up and not a rate increase insight, more than likely we go negative this fall!

But his charts were cool.

murphy
Jul 31, 2016 - 10:53pm

Subscribe or login to read all comments.

Contribute

Donate Shop

Get Your Subscriber Benefits

Private iTunes feed for all TF Metals Report podcasts, and access to Vault member forum discussions!

Key Economic Events Week of 8/10

8/10 10:00 ET Job openings
8/11 8:30 ET Producer Price Idx
8/12 8:30 ET Consumer Price Idx
8/13 8:30 ET Initial jobless claims
8/13 8:30 ET Import Price Idx
8/14 8:30 ET Retail Sales
8/14 8:30 ET Productivity & Unit Labor Costs
8/14 8:30 ET Cap Ute and Ind Prod
8/14 10:00 ET Business Inventories

Key Economic Events Week of 8/3

8/3 9:45 ET Markit Manu PMI July
8/3 10:00 ET ISM Manu PMI July
8/3 10:00 ET Construction Spending
8/4 10:00 ET Factory Orders
8/5 8:15 ET ADP employment July
8/5 9:45 ET Markit Service PMI
8/5 10:00 ET ISM Service PMI
8/6 8:30 ET Initial jobless claims
8/7 8:30 ET BLSBS for July
8/7 10:00 ET Wholesale Inventories

Key Economic Events Week of 7/27

7/27 8:30 ET Durable Goods
7/28 9:00 ET Case-Shiller home prices
7/29 8:30 ET Advance trade in goods
7/29 2:00 ET FOMC Fedlines
7/29 2:30 ET CGP presser
7/30 8:30 ET Q2 GDP first guess
7/31 8:30 ET Personal Income and Spending
7/31 8:30 ET Core inflation
7/31 9:45 ET Chicago PMI

Key Economic Events Week of 7/20

7/21 8:30 ET Chicago Fed
7/21 2:00 ET Senate vote on Judy Shelton
7/22 10:00 ET Existing home sales
7/23 8:30 ET Jobless claims
7/23 10:00 ET Leading Economic Indicators
7/24 9:45 ET Markit flash PMIs for July

Key Economic Events Week of 7/13

7/13 11:30 ET Goon Williams speech
7/13 1:00 ET Goon Kaplan speech
7/14 8:30 ET CPI for June
7/14 2:30 ET Goon Bullard speech
7/15 8:30 ET Empire State and Import Price Idx
7/15 9:15 ET Cap Ute and Ind Prod
7/16 8:30 ET Retail Sales and Philly Fed
7/16 11:00 ET Goon Williams again
7/17 8:30 ET Housing Starts and Permits

Key Economic Events Week of 7/6

7/6 9:45 ET Markit Service PMI
7/6 10:00 ET ISM Service PMI
7/7 10:00 ET Job openings
7/9 8:30 ET Initial jobless claims
7/9 10:00 ET Wholesale inventories
7/10 8:30 ET PPI for June

Key Economic Events Week of 6/29

6/30 9:00 ET Case-Shiller home prices
6/30 9:45 ET Chicago PMI
6/30 10:00 ET Consumer Confidence
6/30 12:30 ET CGP and SSHW to Capitol Hill
7/1 8:15 ET ADP Employment
7/1 9:45 ET Markit Manu PMI
7/1 10:00 ET ISM Manu PMI
7/1 2:00 ET June FOMC minutes
7/2 8:30 ET BLSBS
7/2 10:00 ET Factory Orders

Key Economic Events Week of 6/22

6/22 8:30 ET Chicago Fed
6/22 10:00 ET Existing home sales
6/23 9:45 ET Markit flash PMIs for June
6/23 10:00 ET New home sales
6/25 8:30 ET Q1 GDP final guess
6/25 8:30 ET Durable Goods
6/26 8:30 ET Pers Inc and Spending
6/26 8:30 ET Core inflation

Key Economic Events Week of 6/15

6/16 8:30 ET Retail Sales
6/16 8:30 ET Cap Ute and Ind Prod
6/16 10:00 ET Chief Goon Powell US Senate
6/16 4:00 pm ET Goon Chlamydia speech
6/17 8:30 ET Housing Starts
6/17 12:00 ET Chief Goon Powell US House
6/18 8:30 ET Initial Jobless Claims
6/18 8:30 ET Philly Fed
6/19 8:30 ET Current Account Deficit
6/19 1:00 pm ET CGP and Mester conference

Key Economic Events Week of 6/8

6/9 10:00 ET Job openings
6/9 10:00 ET Wholesale inventories
6/10 8:30 ET CPI for May
6/10 2:00 ET FOMC Fedlines
6/10 2:30 ET CGP presser
6/11 8:30 ET Initial jobless claims
6/11 8:30 ET PPI for May
6/12 8:30 ET Import price index
6/12 10:00 ET Consumer sentiment

Recent Comments

by Silvio's Zipper, 5 min 29 sec ago
by bruinjoe, 5 min 50 sec ago
by Turd Ferguson, 13 min 20 sec ago
by Turd Ferguson, 13 min 42 sec ago
by ggnewmex, 14 min 53 sec ago
by SteveW, 18 min 9 sec ago
randomness