StockCharts.com - Free Charts

Dan Caldwell Rank: 23 Followers: 47 Votes: 13 Years Member: 10 Last Update: 24 May 2013, 17:38 Categories: General Market Commentary
Gold / Gold Stocks
Chart Patterns

5/13/13: Market thoughts: Technically, the market setup reminds me now of early 2008, when the market ground higher, but earnings forecast didn't match 'irrational exuberance.' Also, Dr. Copper is forecasting global economic weakness (then and now, p.2) Heavy insider selling, another warning sign. BUT - If the Fed is backstopping the market, as some suggest, don't bet against it just yet. Wait for a confirmed pullback before selling or going short.

Of worthy interest to gold bulls is that even as the price of miners and metals decline, money flow into the sector continues to accelerate. Looking at 9 period daily/weekly MFI for GDX, GDXJ, NEM, GG, ABX, etc. money flow is rising as prices decline (positive divergence; buy low, sell high). At the same time I'm seeing negative money flow into the major indexes and recent market leaders (buy low, sell high). It's worth paying attention too. Big demand for physical delivery; US Mint sold more bullion in first three months of 2013 than in 6 mo. of.2012, with accumulation by High Net Worth investors. and 3rd world Central Bank buying. Chinese gold imports through Hong Kong were up 89% in February, 97 metric tons imported. Cyprus proposed gold sales of 10 T equals 3 days of Chinese demand. YTD China is on track to absorb 50% of total global mine production. Gold is NOT about USA or European demand; it's all about Chinese, Indian, and Middle Eastern demand. They want to own the metal and at today's depress mining stock prices I expect to see them now making bids for the mining companies.