|
INTRA-DAY NEWSLETTER ~ Feb 20 2015
Note: Gold charts and analysis follows headline news for today.
Before we go to the Greek thing……………..here’s today’s latest currency to collapse........
Danish Krone Collapses after Hints Of Capital Controls
Submitted by Tyler Durden on 02/20/2015
Following numerous rate cuts and backdoor QE (halting government bond issuance), Denmark's Krone is collapsing this morning following the head of Denmark's Economic Council, Hans Jorgen Whitta-Jacobsen said:
DENMARK'S CENTRAL BANK WILLING TO USE CAPITAL CONTROLS IF NECESSARY TO DEFEND DKK PEG
This has sparked the biggest drop in DKK against EUR since 2001 and as SEB chief strategist Carl Hammer exclaimed, "currency markets are extremely nervous."
Ok and now on to the Greek/Euro Snafu……
The Latest "Final Final, Maybe" Eurogroup Meeting
Submitted by Tyler Durden on 02/20/2015
*EU MEETING ON GREECE PUSHED BACK AGAIN TO 11AM ET., GREECE SENT THE WRONG LETTER TO EU
Finance ministers from across Europe are arriving in Brussels for the latest, most critical (until the next one) stare-down across the table at The Greeks. As Germany's Schaeuble noted somewhat pessimistically "we shall see," on the outcome of today's meeting, adding that Greece "must take seriously" previous agreements and "Europe needs mutual trust." Varoufakis on his arrival explained that he "hopes for white smoke" by the end of the day adding that "Greece has gone the extra 10 miles... and hopes EU can meet them one-fith of the way."
Beppe Grillo: "The Eurozone Chess Game Enters Its Final Stage: Germany Wins In Three Moves"
Submitted by Tyler Durden on 02/20/2015
"The Eurozone chess game has entered its third and final stage. Germany wins in three moves - Euro, deflation and purchase of public debt by the ECB (QE) – and in the last few years it has found a way to maximise its profits and reduce to zero its risks as Europe’s creditor.... If we wait too long before leaving the Euro, then Germany will get checkmate and after cashing in all the benefits of our entry into the Euro, it will also cash in on the benefits of our exit."
Greek Deal "Unlikely" Friday Night, EU Official
Submitted by Tyler Durden on 02/20/2015
While markets remain in "well it is Europe and it's OPEX so BTFD" mode, entirely ignorant of what Goldman describes as the risk of a systemic shock, the EU-Greece negotiations continue... to go badly. As Bloomberg reports:
*EU OFFICIAL SAYS GREECE DEAL FRIDAY NIGHT LOOKING UNLIKELY
In fact, the official dropped his expectations so low as to say "it is possible that they could agree on progress." Which at least is one better than the no-progress meeting last week.
And finally today’s key economic qualifiers we all knew was coming for USA.
It Begins: Goldman Cuts Q1 GDP Due To Snow
Submitted by Tyler Durden on 02/20/2015
"We think that negative snowstorm effects could potentially subtract as much as half a percentage point from Q1 growth compared with a neutral baseline, although there is still plenty of time for activity to bounce back within the quarter. In light of our analysis, we reduced our Q1 GDP tracking estimate by two-tenths to +2.8%."
Manufacturing PMI Signals "US Economy Has Entered A Slower Growth Phase"; Employment, New Orders Tumble
Submitted by Tyler Durden on 02/20/2015
Having hovered at its lowest level in 12 months in January, February's Markit US Manufacturing PMI printed 54.3 (modestly above expectations of 53.6). Under the covers it is a very different story with New orders dropping to their lowest level since Jan 2014 and employment falling. While the headline will likely steal the day (though initial equity reactions are negative), as Markit concludes, "the rate of economic growth remains well down on last year."
Gold Commentary
Let’s flip it around and do the MACRO today.
The upcoming big deal for gold is Janet Yellen will be in front of Congress next week testifying and answering questions. This is usually not good for gold, but of course there is no such thing as absolutes in markets.
Do you know what I think the No 1 issue is? The chart below tells the tale.
For some reason the Gold Market participants made the PEOPLE WHO SELL GOLD FOR A LIVING the Guru’s. And ad-nauseam they have made every argument under the book for a massive Dollar collapse and have called the gold low some 20 times now since the high. Last May, the medium and long term moving averages were flashing BULLISH SIGNS and thus GoldTrends has been reporting on every weekend update since that the US dollar was bullish. If the wave count is correct below, we have one more high to make in the USD before we go into a correction mode. We have been favoring a correction for a couple of months and while we have a pullback, it’s not a correction. It is possible that the wave count is wrong and we have already completed 5 waves and that correction is going to unfold. But if not, we have one more wave up to go and (96 to 102) should be strong resistance. So where does that leave gold?
 
Gold
Regardless of the reason be it deflation, liquidity squeeze, supply, demand, QE from USA, QE from Japan, QE from Europe, debt default, China buying, Russia buying, civil unrest, crashing currencies, WAR or just outright total manipulation by the control boyz, it should be very obvious to everyone by now that the only thing that will turn the tide is when the CONFIDENCE in the system is lost and it triggers a SENTIMENT change.
It matters not if this is manipulation. As far as your trading and investing account goes, PRICE IS REALITY. It may be a reality mired in “THE MATRIX” but unless you have access to the blue and red pills, your IN THE MATRIX, not outside of it and even if you are, your financial account ISN’T.
While 2015 is the target low year for gold, cycle work suggests (and I say suggests, not guarantee’s), that if gold rallies from here to the 2nd half of the year, specifically the 4th quarter, odds favors it peaks and turns down for another two years. But if gold can sell off until the end of June or September, odds favor the bear market correction is complete and a three to seven year rally should follow. One thing is pretty much certain. GOLD EITHER GETS IT’s ACT TOGETHER HERE AND SOON OR THE GOLD GURU’S ARE GOING TO GET A POLE SHOVED UP THE CABBAGE PATCH AGAIN AND GOLD IS GOING TO TRADE IN A 3 FIGURE NUMBER AT THE LOWER TREND LINE. GOLD WILL NOT TAKE MUCH MORE OF THIS. We’re at the last support area in gold until 850-1050, and probably 850 more likely than 1050.
The next chart makes you wonder what Guru’s look at to be bullish? It certainly isn’t charts. There is nothing on the charts that has ever suggested the bear market is complete since 2013.
The bottom line here is the downtrend line. It must hold. Oh and by the way, do you know why Guru's always are trying to pick the low and are continuously wrong? First and foremost, the market PARTICIPANTS DEMAND IT ---- AND WORSHIP IT. Regardless of how often they are wrong. The 2nd reason should be obvious................they don't put their money where their mouth is, but rather tell you to buy gold (from them).
Summary
Gold is still in a downtrend and the US dollar has had a massive ride. Is there anything on the chart for gold bugs to hang their hat on? Yes, the 2012 downtrend line that was breached in January. Gold needs to hold that line. A weekly/monthly close below 1130 resumes the downtrend for gold.
On the Shorter term, GoldTrends IS BULLISH ON gold, but it needs to close above 1222 for the downtrend to neutralize and it must hold 1188-1197.
The Greek Showdown is near for Europe, and Janet Yellen testifies in front of Congress.
WILL CONGRESS BRING UP THE USD AND TELL HER TO BRING IT DOWN ?
I WOULDN'T DOUBT IT.
That would favor gold higher right? Only if we close above 1222 and the control boyz are not “primed.” As luck or bad-luck would have it, options expiration is next week. It’s a big one for Silver (March Contract) but not for gold as the forward contracts are in April and June.
Thus on the short term, We're bullish into March 5th. ANY CLOSE BELOW 1188 and forget it---Odds will favor another 2 weeks lower.
| |
