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Copper Points At Weaker Economy?

Aibek Burabayev - INO.com Contributor - Metals

Reddish Metal Disagrees With GDP Readings

World GDP abd Copper Price Growth Dynamics
Chart: Aibek Burabayev; Data: World Bank, CME group

Copper is a core element of our everyday life and it will only grow to be even more important in our digital life as we strive for comfort. The diagram above shows it without saying a word.

The 10-year dynamics of the GDP and Copper growth had the same trajectory, at least until 2014 when the ratios diverged. In 2005-2007 the metal had fallen ahead of the GDP with a steeper curve in 2007 and then both indicators met in the collapse of 2008-2009. And then, amazingly, the ratios proceeded to keep together on the graph showing ideal matching from the bottom to the top in 2010. [Read more...]

Buy Gold For Euros, Sell Copper For Dollars

Aibek Burabayev - INO.com Contributor - Metals

Gold/EUR Is A Buy

Chart courtesy of Tradingview.com

In my January post, I gave the recommendation to buy Gold versus the EUR at 1022 EUR, with a target for inverse Head and Shoulders pattern at 1208 EUR. As seen in the above monthly Gold/EUR chart, the target hasn't been reached so far, but the maximum advance of 138 EUR (14% between 1160 and 1022 EUR) was significant. Today I will update you on that idea with a new pattern that I found on the chart.

For 10 years, the Gold/EUR has been in a long-running uptrend (highlighted in green). The price had been elevating all the way up from 2005 charting clear zigzags and peaked only in 2012 at 1384 EUR level. Then we saw almost a 40% sharp fall from 1384 down to 856 EUR minimum. At the end of 2013, Gold touched the downside of the trend and one month later, at the start of 2014, the market rebounded from the support and found resistance at the magic 1000 EUR level where the price bounced off into a sideways consolidation between 900 and 1000 EUR. [Read more...]

Chen Lin's Secret to Finding the Next Goldcorp

The Gold Report: You've written that the China-led Asian Infrastructure Investment Bank (AIIB) could lead to a boom in commodities. We recently saw that South Korea is joining a number of European countries and signing on, despite U.S. reservations. Do you see this as a threat to U.S. fiscal dominance?

Chen Lin: I think this is a first step for China. The country has a huge reserve, $4 trillion, much more than it needs on the balance sheet to stabilize its currency. The rest is wasted, collecting no interest. China made some huge mistakes in the past through poor acquisition decisions because of faulty lending standards. This is a sign that it has learned from its mistakes and wants to make the most of the trillions it has to loan out right now. The bank will operate close to international standards, and because it has many nations involved already, defaulting loans will include less risk.

"Pretium Resources Inc. is a very high-grade, low-cost, exciting story."

This is a test. If it is successful, it can expand to Africa, South America, even Europe and North America. China has trillions of dollars sitting, doing nothing. It wants to find a way to lend money it can almost guarantee to get back and then put the money to use in the form of development. China has a huge infrastructure network capacity, requiring steel and cement. This creates jobs, which is good for the economy. That was the thinking behind the announcement.

If the AIIB is successful, it will be a big boon for base metals, energy, platinum and palladium sectors. It may even boost silver demand and prices because of its industrial use. I don't think it will have too much impact on gold, though.

TGR: Does that include copper? It has been below $3 per pound ($3/lb) all year. [Read more...]

Article source: http://feedproxy.google.com/~r/theaureport/Ajgh/~3/VljXJx6RlrQ/16601

Short Copper, Pray For Gold, Watch Ratio

Aibek Burabayev - INO.com Contributor - Metals

Dear INO.com Readers,

Today, I'm reviewing three metals based on short-term analysis.

Copper Is A Good Sell

Daily Copper Candlestick Chart

In my January post, I recommended selling copper above $2.75 and I hope you enjoyed a nice profit. For those of you who didn’t take that chance, below is my new one for you.

In December, copper entered a small steeper downtrend (highlighted in red) as the falling price accelerated. After breaking below the descending triangle’s base at $3.02 on the monthly charts, this red metal hit a multi-year low at $2.42, unseen from 2009, losing an impressive 20% in just 2 months. The price met the downside of the channel and quickly bounced off for a $0.20 gain and I will show why you should consider it a dead cat bounce. [Read more...]

Gold's Grinding Message

Precious metals boosters will see gold's nominal price break upward and probably get excited.  They will marshal the troops for what could one day turn out to be a full fledged tout, as if the 40% decline of the last 2.5 years had never happened.


But it is gold’s ratios to positively correlated assets that tells the interesting story.  Vs. Crude Oil, the story could be shaping up to be a positive one for the gold mining industry, which is counter cyclical and obviously energy and fuel intensive. [Read more...]

Whack-a-Mole (Japanese Nikkei is the Latest Bubble)

Alan Greenspan gave them the playbook (Credit & Debt Manipulation 101) and now Ben Bernanke and global inflators everywhere have taken the ball and run with it in new, innovative and levered up ways.  Actually it’s a game of Whack-a-Mole and they play it well, these inflating moles.  The minute you think you’re going to drop the hammer on one of their heads, he’s gone and another one pops up elsewhere.

So how can we follow all the data points that hands-on, manipulative policy has introduced and forecast conclusions with accuracy?  The answer is that it is difficult in the short-term, but in the long-term we are all dead anyway, so we might as well use some inflationary bubbles of the past as a road map to what may be ahead.

There are currently several bubbles (and one anti-bubble*) in play over varying time frames.  These bubbles are the direct result of policy actions.  Last weekend we reviewed the bubble in Japan’s Nikkei in relation to its policy-induced crashing of the Yen and then last week wouldn’t you know that the Yen caught a bid and the Nikkei suffered an incredibly bearish day? [Read more...]

Today's Video Newsletter: A Snake, an iWatch and the State of the Union

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Monday, the 11th of February.

Yesterday was the beginning of Chinese New Year, the year of the snake. Traditionally, the Chinese set off fireworks to mark this holiday and celebrations take place throughout China. This year, sales of fireworks were 37% less than in previous years. This was said to reflect a government appeal to ignite fewer fireworks to avoid more pollution in the cities. The year of the snake means it's going to be a year of steady progress, focus and discipline for the nation of China. Given the crazy world that we are living in, steady progress, focus and discipline are not a bad way to go IMHO. [Read more...]

Today's Video Newsletter: The market takes a pause before the State Of The Union Address on Tuesday

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Friday, the 8th of February.


I think this week is pretty reflective of a wait-and-see attitude the market is taking to see what Pres. Obama is going to say on Tuesday with his State of the Union address.

I will be on CNBC Asia live from Washington DC shortly after the State of the Union Address on "Cash Flow" around 10pm ET, next Tuesday night (Feb 12th). I will be addressing what the President said and how the markets are likely to respond. With the State of the Union address and the sequestration at the end of this month, there are a lot of uncertainties in most investors' minds. I think that the markets next week and even perhaps for the rest of the month are going to be choppy. Let's check the trends carefully and see how some of the key markets react to these two important events. [Read more...]

Today's Video Newsletter: Did Yahoo Strike a Deal with The Devil?

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Thursday, the 7th of February.

On the job for a little over 6 months, Yahoo CEO Marissa Mayer turns to her old employer Google and signs a deal to help bump up Yahoo's advertising revenues. Will this strategy help or hurt Yahoo?

Yahoo's revenues have been steadily declining until last year, when magically there was a small up-tick. In the non-exclusive deal with Google, the revenue split could be as much as 68% in favor of Yahoo. On the outset we cannot see how this could hurt Yahoo, but is it a long term solution to sustained profitability? Yahoo already depends on Microsoft for most of its search-driven advertising as part of a long-term deal executed back in 2009. [Read more...]

MarketClub TV: Clash of the Titans

Hello traders everywhere! Adam Hewison here, co-founder of MarketClub with your mid-day market update for Wednesday, the 6th of February.

I know it sounds like a cheap B movie title, but the reality is this is a very real clash between Rupert Murdoch with his powerful NEWS Corp holdings and John Malone with his equally powerful Liberty Media Empire.

Today Liberty Media announced that it had purchased Virgin Media in the UK for a deal valued around $16 billion dollars.

Sir Richard Branson, who is a part owner of Virgin Media, walked away with a cool $316 million in his pocket after handing over his shares. Nice work if you can get it. Today we will be looking at both Liberty Media Corp (LMCA), and News Corp (NWSA) to see which is the best bet in media. [Read more...]

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