United States Still Going Bananas

Posted on by Gary Tanashian

You see, it’s not a Trump thing. It’s an ‘America is so hopelessly indebted (as are other developed economies) that they have no choice now’ thing.

However, the election shakes out – most likely Democrat president and congress, Republican senate – the stock market is cheering two things in my opinion. It is cheering US dollar compromising fiscal stimulus (Fed prints, politicians spend) and the coming of more US dollar compromising monetary policy (Fed prints, Fed monetizes bonds AKA debt, Fed screws with any other esoteric tool it can get its hands on in the age of MMT TMM, AKA Total Market Manipulation).

I have a still profitable position against the Euro that is about to tick un-profitable this morning. That was my hedge against a firming US dollar, which is the anti-market to the US stock market especially, but also to many global markets because I am long US and global stocks. I may have to pull back to hedging stocks (including gold stocks) with high cash levels. So says the ongoing inflationary operation.

I had projected an A-B-C bear market bounce in Uncle Buck, just to keep the macro honest and put a spook into market bulls. But it appears – due to the joy breaking out everywhere – that I will have been wrong about ‘C’. That’s what this breakdown below support (now short-term resistance) says, anyway.

dxy market

We are going bananas not because Trump is/was just another politician when it comes to the modern American tradition of debt-leveraged inflation to disenfranchise the middle and poor and enrich the already spectacularly wealthy. We are going bananas because Continue reading "United States Still Going Bananas" →

Now Could Be the Best Time To Buy Marijuana ETFs

Posted on by Matt Thalman

After a few years of marijuana stocks being high-flyers, largely due to investors rushing in for fear of missing out on the next big industry, the marijuana industry has not been kind to those early investors in recent years. However, that all may be changing very soon.

With a few more States recently voting to legalize the drug and the U.S. House of Representatives scheduled to vote on the decriminalization of marijuana, it truly now appears that it is just a matter of time until the drug is legally sold throughout the United States.

Furthermore, the Mexican government appears to also be on the verge of legalizing the drug as well. If Mexico does legalize marijuana, it could become the largest cannabis market in the world. And since Mexico's climate is ideal for growing marijuana, it could become a powerhouse in terms of a worldwide supplier, or at a minimum, the top North American supplier. However, none of the major Canadian marijuana companies have a foothold in Mexico yet, which could cause delays in how long investors need to wait to see any meaningful gains from their investments in the industry today.

Regardless, though with more U.S. States legalizing it and decriminalization votes set to take place in the U.S. legislature, and Mexico appearing to be on the verge of legalizing the drug, now would seem like a good time to get on the train. It's usually better to be early than it is to be late.

So, if you are ready to buy into the industry, or even if you want to wait, let me give you a few options you can look at Continue reading "Now Could Be the Best Time To Buy Marijuana ETFs" →

U.S. Crude Production Fell In August

Posted on by Robert Boslego

The Energy Information Administration reported that August crude oil production fell by 401,000 barrels per day, averaging 10.579 mmbd. This follows a 538,000 b/d rise in July and a 2 million barrel per day collapse in May. The August 914 figure compares to the EIA’s weekly estimates (interpolated) of 10.429 mmbd, a figure that was 150,000 b/d lower.

Monthly US Crude Production

The primary cause of the drop in production was disruptions in the U.S. Gulf Coast due to hurricane activity. USG production dropped by 453,000 b/d from July, and Texas output fell 49,000 b/d, while Louisiana fell by 17,000 b/d.

Rebounds were largest in North Dakota (126,000 b/d) and New Mexico (27,000). Given the huge reduction in May and this reduction in August, production dropped by 1.806 mmb/d over the past 12 months. This number only includes crude oil. Other supplies (liquids) that are part of the petroleum supply rose by 130,000 b/d from a year ago. Continue reading "U.S. Crude Production Fell In August" →

Silver Futures Remain Extremely Choppy

Posted on by Mike Seery

Silver Futures

Silver futures in the December contract is currently trading at 23.61 an ounce after settling last Friday in New York at 24.67 down over $1 for the week as prices are right near a 5 week low.

At the current time, I'm not involved. Suppose you have been following any of my previous blogs. In that case, you understand that I was looking at a possible bullish position if prices broke the 25.71 level, which never occurred, so I'm sitting on the sidelines being patient as this market remains extremely choppy. Remember, when you trade the commodity markets, trading with the path of least resistance is the way to go over time while also avoiding choppy markets like silver. We await the highly-anticipated U.S election next Tuesday, which certainly will dictate short term price action going forward.

Silver prices are now trading below their 20 and 100-day moving average as the trend has turned to the downside with major support at the 22 level. If that is broken, you would have to think that prices will go down to the 20 area; however, longer-term, I still like silver as I'm just waiting for a buying opportunity.

TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: HIGH

Gold Futures

Gold futures in the December contract settled last Friday in New York at 1,905 an ounce while currently trading at 1,887 down about $20 for the trading week as prices are hovering right near a 3 month low.

I do not have any precious metal trades as I was looking at a possible bullish position if prices closed above the 1,939 level, which never occurred. This market is under pressure because a stimulus agreement will not be reached before the U.S. election next Tuesday as that is disappointing, therefore, pushing the U.S. dollar higher. Continue reading "Silver Futures Remain Extremely Choppy" →

Gold Miners: Beautiful Pictures

Posted on by Gary Tanashian

After a well-deserved correction of nearly 3 months, the gold stock sector is still flashing positive signs beneath the surface, as the correction matures.

The correction that began in August amid the ‘Buffett Buys a Gold Stock!‘ tout has now ground on for nearly 3 months. As noted in the NFTRH 626 Opening Notes segment:

“Thus far the correction in gold, silver and the miners is perfect, where perfection means long, drawn out and maddeningly frustrating to bulls (and bears thus far). That’s what corrections are, remedies to excitement, confidence and of course, greed.”

We are managing the technical details (and associated strategies) of the correction in HUI and individual gold stocks each week in NFTRH, but as a gold stock investor, it has not been a time for making money since August. As a trader, it has been a difficult time for making money as well, because of the lack of a definitive drop that the sector’s corrections are known for. It has been a grind, and in that annoying, time-consuming process, it has been perfect.

Below are some pictures that we have maintained front and center during the correction in order to disqualify or more likely, confirm the macro bull view for gold and the miners. This was so that subscribers could sell, buy or hold as they see fit, but more importantly so that we could know the status of the backdrop all along the way to make better-informed decisions.

Meanwhile, the perfection has been in the cleaning of the investor base, a large portion of which thinks that inflation is good for gold miners. Often it is for the stock prices, but rarely is it good for the bedrock sector fundamentals. One of the best measures of the real price of gold is the Gold/CRB ratio, which is in part of the measure of the gold mining product vs. gold mining costs, especially energy costs. Continue reading "Gold Miners: Beautiful Pictures" →