Archive for Opinions

Stocks Have Entered a 25-35year Crisis Cycle Re-evaluation Event

By TheTechnicalTraders 

– We can only imagine what many of you are thinking and feeling right now.  Shock?  Concern?  Despair?  Some of you have already emailed us asking about the US and Global markets to find out what our predictive modeling systems are suggesting.  Today, we’re going to show you what the longer-term Adaptive Fibonacci Price Modeling system is suggesting for the S&P and NASDAQ.

First, we want to ask you to slow down, take a few seconds to realize we will recover from this virus event and the smart thing to do is protect your family, protect your assets, and prepare for the future.  Market crashes happen only 2-3 times in a lifetime and they, not the end of the world or financial system.

This event is different than the 2000 or 2008 market crash events.  Each of those past events was somewhat localized events that disrupted a segment or portion of the global economy.  Yes, the 2008 event was bigger than the 2000 event, but the localization of the event still presented a similarity that provided a moderately quick recovery process.

Before we continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

Next, we want you to attempt to understand this virus event is a bit different than the most recent crash events.  A virus pandemic of this nature will likely result in a much broader economic contraction and various collateral damage processes as it transitions across the globe.  Currently, our research team is attempting to watch for the early signs of these collateral damage processes to determine if a broader global market collapse is going to take place.  At this time, we must all try to prepare for what is unknown and could happen in the future.

The longer-term generational cycle (the roughly 85-year Strauss-Howe Theory suggests societies navigate a long term cycle that repeats itself, roughly, every 85 years).  This societal evolutionary theory centers around the concept that people repeat many of the same failures learned by previous generations – roughly every 85 years.  What was learned in the 1920s~1940s will have been forgotten in the 1990s~2020 and many of the same mistakes will be made.

One of our researchers, Brad Matheny, authored a book in March 2019 that analyzed these super-cycles and accurately predicted this market crash could happen as early as August or September 2019.  Within this book, Mr. Matheny made great efforts to illustrate how important it is for everyone to become aware of these bigger market cycles and to prepare for what was likely to come near the end of 2019 and into early 2020.  You can get your own copy of this book here.

Additionally, smaller market cycles take place within the bigger super-cycles. This example of the 8.6-year business cycle highlights the repetitive nature of these broader market cycles.  Think about how 10 of these smaller business cycles equal the much larger 85-year generational cycle.  Now, think about how each stage of the roughly 20~21 year generational cycle has played out over the last 85 years.

This screen capture highlights the phases and structures of the broader Strauss-Howe generational theory.  Pay very close attention to how structured the process is and what to expect in the future.  Also, notice that we entered a CRISIS phase in 2005.

Past cycles have lasted more than the average 20~21 years.  Longer cycle lengths are not uncommon within the broader 85-year super-cycle when larger societal events take place.  Thus, this current CRISIS phase could last 25 to 35 years before a new HIGH phase sets up.

The reason we are bringing all of this together within this article is because we want to clearly stress forward and future expectations as well as to make our longer-term market concerns very clear to all of you.  If, as the generational cycles suggest, we have entered a CRISIS phase and are moving toward a HIGH phase, then we are in the midst of a phase that can be very destructive to institutions and society as a whole.

“According to the authors, the Fourth Turning is a Crisis. This is an era of destruction, often involving war or revolution, in which institutional life is destroyed and rebuilt in response to a perceived threat to the nation’s survival. After the crisis, civic authority revives, cultural expression redirects towards community purpose, and people begin to locate themselves as members of a larger group.”

These super-cycles and the broader “collateral damage” issue is what leads our researchers to believe the US and Global markets may continue to target much deeper price support levels before finding a bottom.  Even though the US and global central banks are doing everything possible to avoid a contagion economic collapse, we believe many people have “forgotten” about these broader market cycles and may be shocked to learn the COVID-19 virus event is happening in the midst of an 85-year generational Super-Cycle that predicts a true price bottom (new HIGH phase) may not set up until 2030~2035.

Let’s take a look at where our Adaptive Fibonacci Price Modeling system is suggesting the markets may bottom..

Daily S&P 500 Futures Chart

We’ll start by exploring this Daily ES chart which highlights two key Fibonacci downside price targets: 1683 and 1225.  Look for the GREY and RED lines near the bottom of this chart and look for the BLUE/RED and GREY SQUARES near the right edge of this chart.  These SQUARES are the DAILY Fibonacci downside price targets as calculated by our Adaptive Fibonacci Price Modeling system.

Also, pay attention to the CYAN price channel that we’ve drawn on this chart highlighting the current downside price channel that has setup.  It is our opinion that price will likely attempt to stay within this price channel as it moves deeper to target these support levels – eventually attempting to set up a bottom near either of these deeper Fibonacci support levels.

Weekly S&P 500 Futures Chart

This Weekly ES chart highlights the Weekly Adaptive Fibonacci Price Modeling system’s results – which are almost exactly the same as the Daily targets.  This is very important if you understand that the Fibonacci price structure is supposed to be structured in a universal means throughout all price activity.  Thus, if the Daily and Monthly Fibonacci Modeling system is targeting the exact same levels – then this carries much greater importance to us.

The same downside targets in the ES are 1683 and 1225.  These represent a continued downside price move of -32.75% or -50.25% from current levels.  The YELLOW lines we’ve drawn on the chart represent what we believe the bottom may look like if the first level of support, 1683, acts at a bottom.  We do believe a bottom will set up in a FLAG formation that may take many months to complete before any real rally begins.

We issued an important investment trade alert this week that you should know about if you have not read this alert so be sure to do so now!

Weekly Nasdaq Futures Chart

This Weekly NQ chart points to an even deeper price bottom.  The downside Fibonacci targets are 3900 and 1865 (-48.59% and -75.15% below current price levels).  These deeper price targets suggest the NASDAQ market may become unusually volatile over the next 12 to 24+ months.  We believe this could become an unforeseen risk for many global investors that believe technology will recover faster than many other market sectors.  If our research is correct, the NASDAQ could collapse to far deeper levels than the S&P or the Dow Industrials.

How could the NASDAQ collapse like this?  Remember the “collateral damage” aspect and think about what it would take for these technology companies to loose their financial support?  Companies like Twitter, Uber and dozens of others operate with negative annual cash-flow – they depend on spending money they can’t earn to stay in business.  If this cash reserve vanishes – what happens?

The process of getting to these lows can come in many forms – yet the targets are still there for us to understand and prepare for.

On the weekend I wrote an interesting post sharing a trading experience I had during the 2000 bull market and how there are some similarities in price patterns and psychologically with traders as we have right now. It’s worth a read.

Watch for the global markets to continue to target recent lows.  On the NQ chart, above, we’ve drawn some CYAN lines near recent lows to illustrate these levels.  If the global markets do collapse to the Fibonacci levels we are predicting, then a much bigger contagion event is taking place along with the generational cycles and an unraveling of many institutional processes and functions.  Remember, we may continue within the CRISIS phase of the Super-Cycle for another 3 to 10+ years.  The COVID-19 virus event may be just the trigger of this collapse – but the writing has been on the wall for many decades.

Be very cautious buying into these dips at the moment.  We have been warning about this event for a while. Just last week we published a short guide and our basic trading and investing strategy on how to profit from bear market cycles – explained. Our researchers predicted August/September 2019 as the “critical date” and urged “move to cash” at that time to protect your assets from this event – few listened to us while the markets continued to push higher.

Luckily, on February 23rd we closed out all of our remaining positions for our active ETF trading account with our subscribers. Our trading accounts are sitting at a new high watermark and we avoided the market crash and took advantage of the 20% rally in bonds.

Maybe more people will listen to us after reading this article and prepare for what may come in the near future?  Maybe some of you will grasp the idea that these Super-Cycles are real and learn this may become the greatest opportunity of your life with our help.

As a technical analyst and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for short-term swing traders.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts visit my Active ETF Trading Newsletter. If you are a long-term investor with any type of retirement account and are looking for signals when to own equities, bonds, or cash, be sure to become a member of my Long-Term Investing Signals.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategies
Founder of Technical Traders Ltd.

TheTechnicalTraders.com

Metals Rally Amidst Market Stabilisation

By Orbex

 Gold

– It’s been a much quieter week for the yellow metal on the back of the recent volatility we have seen in prior weeks. The ongoing coronavirus situation continues to dominate market news-flow and remains the key catalyst for price action currently.

Gold prices have recovered strongly off the March lows are now sitting in a holding pattern not far of the year to date highs.  With central banks around the world having announced fresh easing in recent weeks, gold prices have been supported. The Fed, in particular, has made the historic move of curing rates to just above 0% while also making the move into unlimited QE. This recent announcement has helped pull the Dollar back from the highs seen in March (index reached highs of 102.95), also helping support gold.

For now, the outlook remains mixed, but upside risks are clear. As gold reverts back to traditional safe-haven status following the stabilisation in asset markets over the last week, focus is on a further push higher. Incoming US data will be closely watched and could weigh further on USD. Traders should also keep an eye on equities prices here as the moves in gold are broadly tracking the moves we are seeing on the key US indices.

Gold Prices Holding Above Channel Top

Gold prices are trading back above the bull channel top, with the retest of the broken channel top providing support. While price remains above here, the focus is on a further push higher with a test of the year to date highs around 1700 the next technical marker to watch. To the downside, any break lower should find support into the structural support level around 1450.

Silver

Silver prices have been higher this week, benefiting from the pull-back in USD as well as the improvement in the equities landscape. Despite some loss of upside momentum, asset markets have stabilised over recent sessions, improving the outlook for silver. Silver prices also received a boost this week from Chinese manufacturing data. The Caixin manufacturing PMI saw the sector recovering into positive territory over March following a record plunge over the prior month.

Silver Prices Back Above 2019 Lows

The rally off the lows in silver has seen price breaking back above the 2015 lows of 13.6219 with the market currently challenging the 2019 lows around 14.3722. If price can establish a higher low here and move above the current highs there is a good chance of a more sustained recovery developing which would put the focus on a move back up to the 16.3502 level next.

By Orbex

 

Concerned That Asia Could Blow A Hole In Future Economic Recovery

By TheTechnicalTraders 

– Thinking somewhat far off into the future, our researchers believe China/Asia could become the next Black Hole in the global economy.  China recently released its March PMI number which came in at 52.0 – showing moderate expansion in Chinese manufacturing.  The February Chinese PMI level was 35.7.  We strongly believe China wants to show some strength in their perceived economic recovery and that these PMI numbers are somewhat “manufactured for effect”.

We believe the real economic toll taking place in China/Asia will continue to unfold over the next 3 to 6+ months as the historic expansion of wealth and the exported foreign investment from Wealthy Chinese continues to contract over this time.  In a very similar manner to what happened in the US when the Japanese economy contracted in the 1990s – as wealth creation processes collapse, these foreign investors suddenly start to liquidate assets trying to protect their “home-country assets”.

(Suggested Reading: https://www.barrons.com/articles/china-pmi-data-coronavirus-51585666441)

We’ve recently posted an article suggesting the US Real Estate market could suddenly find itself in a real measurable collapse and we believe the foreign investors, speculators and speculative renters (Air BnB and others) will suddenly find themselves in a very difficult situation.  You can find our Real Estate article here.

As the COVID-19 virus event continues to unfold, the data from global nations will quickly identify any outlier factors and data points related to China/Asia and how they are reporting their data.  Chinese economic data has raised suspicions for quite some time with global analysts.  It seems highly unlikely that the Chinese economy rebounded from an almost complete shutdown in February and most of March to a moderate manufacturing growth level at the end of March 2020.  Meanwhile, throughout the rest of the globe, economies, and manufacturing levels are contracting as the COVID-19 shutdown continues.

(Suggested Reading: https://www.yahoo.com/finance/news/asias-factory-activity-plunges-coronavirus-044302834.html)

We believe the disparity between the global markets and the numbers China continues to proffer will quickly result in a complete lack of confidence in future data related to any Chinese economic activity or future expectations. We also believe the global capital markets will make an immediate shift away from risks associated with any falsified data originating from China by mitigating forward risks in investments and currency market exposure over the next 3 to 5+ years – possibly longer.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

Source: Finviz.com

What happens when global events like the COVID-19 virus event takes place is that capital immediately attempts to identify extreme risks and attempt to move to safer environments.  Currencies are no different.  Global markets, investment, and manufacturing are increasingly exposed to risks related to the shifting markets and any false or otherwise “outlier” data being reported right now.  The bigger players can’t afford to take risks and will take active measures to protect their futures and investments.

Source: Finviz.com

(Suggested Reading: https://www.cnbc.com/2020/03/31/asia-markets-china-official-pmi-coronavirus-global-economy-in-focus.html)

Our opinion is that the Chinese PMI level of 52 for March 2020 is an outlier data point.  This virus event started in early January in China and almost all of February and March were when the globe suddenly became aware of the risks and infection spread.  Even though China may have attempted to ramp up manufacturing over the past 2+ weeks to appear to be “back to normal” – it makes no sense to us that manufacturing in China actually “expanded”, based on historical levels, that quickly.

Watch how quickly global economies and currencies work to mitigate the risks related to perceived “outlier data”.  We believe most of Asia will continue into an economic contraction over the next 3+ months and we believe the FOREX market will relate the immediate risk concerns related to Asia/China/global market expectations.  In other words, watch the currencies to see how global investors perceive risks associated with true economic activity.

The World Bank many not have a deep enough piggy bank to back the extended risks of an Asian Economic contraction lasting 6+ months.

(Suggested Reading: https://www.marketwatch.com/story/world-bank-says-coronavirus-outbreak-may-take-heavy-toll-on-asias-economy-2020-03-30)

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for short-term swing traders.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts visit my Active ETF Trading Newsletter. If you are a long-term investor looking for signals when to own equities, bonds, or cash, be sure to look into my Long-Term Investing Signals.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategist

TheTechnicalTraders.com

 

Europe’s Coronavirus Contraction Part II: Bracing for Contraction and Debt Crisis

By Dan Steinbock     

Since inadequate preparedness prevailed in Europe until recently, the consequent pandemic will cast a prolonged, dark shadow over the regionwide economy – starting with the contraction, followed by the debt crisis.

Around the world, the early economic defense against the economic impact of the novel coronavirus has been by the major central banks to cut down the rates, inject liquidity and re-start major asset purchases.

But as the post-2008 decade has shown, monetary responses cannot resolve fiscal challenges.

Bracing for the plunge

The early damage has focused on a set of key sectors, such as healthcare, transportation, retail, tourism, among others. So easy money will be coupled with targeted fiscal stimuli in affected economies. Yet, current measures to restrict the infection and economic damage will contribute to further debt erosion in major advanced and emerging economies.

Recently, the White House signed the $2 trillion coronavirus bill, the largest ever U.S. stimulus. It may not ensure adequate support for more than 4-6 months. To overcome the crisis, an extended period of 6-18 months may loom ahead when some kind of fiscal accommodation will be needed.

In the US, sovereign debt has increased record fast in the Trump era and now exceeds $23.5 trillion (107% of GDP); that is, before the virus stimulus bill or bills will cause it to soar. And so, we are back in the post-2008 territory that was never supposed to recur. But now, after a decade of ultra-low rates, rounds of quantitative easing and liquidity injections, the situation is much worse.

In the Eurozone, recessionary pressures come in a particularly bad time. Before the virus, the annual economic growth was about 1.0% in the fourth quarter of 2019, signaling the weakest expansion in seven years. However, the first quarter could contract to -3.0%, while the second could be worse than in 2008-9.

In both the United States and the Eurozone/UK, the first quarter damage will only be the prelude to the second quarter carnage. And if the virus is not managed appropriately, the consequent hit will cast a shadow over the hoped-for rebound in the second half of 2020 as well, possibly into 2021.

In Europe, the Maastricht Treaty deems that member states should not have excessive government debt (60%+ of GDP). Today, no major European economy fulfills that criteria. To overcome their short-term challenges, countries will take more debt, which will further erode their debt-to-GDP ratios.

Certainly, central banks in Europe and the UK will follow US footprints into more monetary and fiscal accommodation. But that may fail to quell virus fears, if infection rates continue to soar. As virus mobilization intensifies in European economies, so will new debt-taking.

Even before the virus crisis, Italy’s level of sovereign debt soared from 110% as share of the GDP to the alarming 135% in the course of the 2010s. It will increase a lot faster now. In Spain, the debt crisis of the past decade pushed the ratio from just 60% to a peak of 100% of GDP in 2014. In the past half a decade, it has decreased but that progress will now be reversed.

In France, the ratio climbed from 85% to close to 100% in 2016 but has stayed at that level since then. Those days are now over as the ratio will start climbing. In the UK, sovereign debt was close to 60% in 2010, but soared to close to 85% in 2017, thanks to the impending Brexit. Now the UK will have to face the costs of the Brexit and the virus crisis.

Germany is the only major European economy in which sovereign debt as share of the GDP actually declined in the past decade from 80% to close to 60%. In the past two years, Berlin has been able to offset the US tariff war losses, but now it will have to cope with worse challenges. And when German economy contracts, the rest of Europe will plunge.

The way out

In advanced economies – and particularly in the heavily-indebted European countries, which are already struggling to absorb the costs of the 2008 great recession, the 2010 EU debt crisis, the UK Brexit, and the US tariff wars – the coronavirus contraction has potential to wipe out a decade of recovery. But that’s just a prelude.

Furthermore, if containment measures fail, or subsequent mitigation proves inadequate, or new virus clusters emerge after containment and mitigation, markets will remain volatile and economies will suffer further damage, particularly if multiple waves of secondary infections recur after current restrictive measures.

What is desperately needed is multipolar cooperation among major economies and across political differences. In this quest, China, where containment measures have been successful, can show the way, along with major advanced and emerging powers.

President Xi Jinping’s call on Trump to improve US-China relations amid Covid-19 crisis and cooperate against the virus is a good start.

But isn’t it time for Europe to join the bandwagon?

About the Author:

Dr. Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (USA), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more, see https://www.differencegroup.net  For recent coronavirus briefings, see https://www.differencegroup.net/coronavirus-briefs

This is the second part of the commentary that the European Financial Review released online on March 30, 2020 online and will publish in its April/May print edition.

Gold Explorer Focuses on Acquisitions in Productive Canadian Districts

Peter Epstein of Epstein Research and Falcon Gold CEO Karim Rayani review prospects from the company’s holdings in Ontario.

By The Gold Report – Source: Peter Epstein for Streetwise Reports   03/31/2020

Few investments are working these days. Oil, blue-chip stocks, cotton, lumber major mining companies. . .all have been decimated in the past six weeks. Teck Resources Ltd. (TCK:TSX; TCK:NYSE) is down 73% from its 52-week high. Copper is 27% lower than it was a year ago. Yet the gold price has done quite well, up 30% from last year’s low and near a seven-year high.

With the strength in gold, gold juniors could make a move higher even as other stocks languish. Juniors with strong management teams, good projects in favorable jurisdictions and attractive valuations offer compelling upside potential, albeit with commensurate high risk. Precious metals companies in Canada are also benefiting from a significant move in the Canadian dollar/US dollar (CAD/USD) exchange rate (project costs in CAD declining versus USD gold price).

A small-cap company worth learning more about is Falcon Gold Corp. (FG:TSX.V). It has an amazing team for a company with a market cap of just CA$2 million. Management has a lot of skin in the game, there are multiple Canadian projects, and more assets are poised to possibly come into the company. The following interview is of CEO and director Karim Rayani. Please continue reading to find out why an investment in Falcon Gold is well worth considering [corporate presentation].

Peter Epstein: Please give readers a history of Falcon Gold Corp.

Karim Rayani: Falcon is a Canadian mineral exploration company focused on generating, acquiring and exploring high-grade opportunities in the Americas. Our Ontario, Canada, projects include the Central Canada gold project, the Wabunk Bay gold/base metals project in Red Lake, the Bruce and Camping Lake gold projects, also in Red Lake, and a 49% interest in the Burton gold property with Iamgold.

The company is focused on high-grade acquisitions [with] a lengthy history of mining, where we can generate results rapidly and cost effectively, using modern exploration methods, to update, enhance or introduce new NI-43-101-compliant mineral resource estimates. We have five Canadian projects at the moment.

PE: Can you tell us about Falcon’s management team, board & corporate advisors?

KR: Falcon is led by a seasoned team of mining execs. I stepped in as CEO about nine months ago and am the largest shareholder. I’ve been a financier for the past 15 years, focused on domestic and international exploration projects. We have assembled a world-class team that has had tremendous success in the mining sector.

Tookie Angus needs no introduction: He’s the former head of global mining group Fasken Martineau. For the past 40 years, Mr. Angus has focused on structuring and financing significant international exploration, development and mining ventures. He has had a long string of successes. Tookie’s a lawyer by trade and will be very valuable to us as we advance our Central Canada project.

On the geological side, top-shelf former Rio Tinto and Anglo American geologist Ian Graham is overseeing the planning of our exploration programs. Mr. Graham is an accomplished mining executive with over 20 years’ international experience exploring for and developing mineral deposits. He has vast experience in bringing projects to scale and seeing things that others don’t. Ian is ideally suited to be overseeing our data.

PE: You mentioned several promising properties/projects. Which are the top two priorities for 2020?

KR: Central Canada is Falcon’s flagship project. It’s 20 kilometers on a parallel system to Agnico Eagle Mines Ltd.’s (AEM:TSX; AEM:NYSE) Hammond Reef deposit in Northwest Ontario. They have a 4.5-million-ounce [Measured and Indicated] gold resource. The Hammond Fault is the structural corridor for those ounces.

Our project is on the Quetico fault, a similarly major structure in its own right. We have been successful in closing two joint ventures (JVs); in one we still hold a 49% interest, with IAMGOLD Corp. (IMG:TSX; IAG:NYSE) holding 51%. It’s a testament to our ability to source projects and package them without overly diluting shareholders.

PE: Please give us more detail about the considerable amount of historical work that has been done on your Central Canada project.

KR: Gold mineralization can be traced widely across the Central Canada property. More recent drilling by Interquest Resources Corp. intersected over one meter at ~30 grams per tonne (g/t) gold in diamond drill core. In 2012, TerraX Minerals (now Gold Terra Resource Corp. [YGT:TSX.V; TRXXF:OTC; TXO:FRANKFURT]) hit 23.3 meters (23.3m) of 1.83 g/t gold.

Trenching work in 2011 indicated significant gold mineralization to the south of the historic Sapawe gold mine, where the operator sampled up to 6.7 g/t gold. Significant gold mineralization of up to 24 g/t has also been identified in the halo of the original Sapawe mine.

PE: Explain the English Claims option. How important is this option?

KR: The English Claims tie directly onto the Central ground. There are some very rich gold targets that we will be going after. Readers should note, only a small percentage of the property has been explored in any meaningful way.

PE: How far do you think that you will have to advance the Central Canada project before a strategic investor might want to invest in it?

KR: We think interest from strategic investors could come as soon as this year. Our objective is to start drilling right away, as we have received our drill permit. We are confident that we will come back with strong results from twinning historical high-grade holes.

We will update historical and new data into a NI-43-101-compliant resource. Upon completion of the twining of historical holes, infill drilling and testing the deposit at depth, we expect to get an indicative scope of the size and economic potential of the project.

PE: You have farmed out your Camping Lake property, retaining a small net smelter return (NSR). Could this asset still move the needle for Falcon Gold if your farm-out partner has success?

KR: Either way, Falcon is in a very good position. We still have a 49% economic interest once International Montoro Resources (IMT:TSX.V) spends $300,000 in the ground. They can opt for an additional 24% for a one-time payment to us of $500,000. At that point we would retain a 25% percent interest in the project plus a 0.5% NSR. So yes, we absolutely still have skin in the game here.

PE: No doubt your team likes northern Ontario quite a bit. What makes it a great place to explore, and potentially develop mining projects?

KR: We are in one of the best jurisdictions for mining, period. The amount of success in this area is quite profound. Great Bear Resources Ltd. (GBR:TSX.V; GTBDF:OTCQX) has had tremendous success. We are surrounded by multimillion-ounce deposits. The political environment could not be better. The area is prospective for both high-grade gold and base metals. The regional infrastructure is outstanding.

PE: Although there have been, and continue to be, notable success stories in the Red Lake mining district, why hasn’t the area become even more busy, with gold recently touching US$1,700/ounce, and now at about US$1,650/ounce?

KR: The sector has been beaten up. It’s only relatively recently that some of these companies have seen an influx of capital. Whenever there is a discovery there is a flow of money. Larger companies are paying dividends and reporting record revenues. In order to compete, we will need to see a further spike in the price of gold for the junior miners to gain real momentum. With current world events effecting the markets, it’s not a matter of if, but when, gold prices move even higher.

PE: How do you plan on funding your exploration programs?

KR: The company is currently fully funded for 1,000 meters of drilling. Could we use more money? Yes, of course. But we’re raising funds only when those dollars are used for drills turning. I’m committed to doing the work while preserving our cash and protecting the capital structure. That means no dilutive financings.

PE: There seems to be support for a strong gold price through at least the U.S. presidential election in November. What are your thoughts on gold?

KR: I don’t think there has been a better time to have exposure to precious metals. I have always been a gold bug, and we’re seeing near record highs since 2013. With inflation and global stimulus packages kicking in, I believe it’s only a matter of time before a wave of investment capital flows into our sector.

PE: Where do you stand with regard to acquiring new assets or farming out existing assets?

KR: Falcon’s flagship asset is our Central Canada project, but we are also focused on generating revenue through royalties and acquiring additional assets. It’s the only real way to set us apart and generate long-term shareholder value. We hope to be able to announce the addition of one or two new projects in coming months, so your readers should keep Falcon Gold on their watch lists!

PE: Thank you, Karim. There is a lot going on at Falcon Gold. I truly look forward to updates on the company this spring and summer.

[Corporate Presentation]

Greg Nolan’s latest masterpiece on Equity.Guru

Peter Epstein is the founder of Epstein Research. His background is in company and financial analysis. He holds an MBA degree in financial analysis from New York University’s Stern School of Business.

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Disclosures: The content of this article is for information only. Readers fully understand and agree that nothing contained herein, written by Peter Epstein of Epstein Research [ER], (together, [ER]) about Falcon Gold, including but not limited to, commentary, opinions, views, assumptions, reported facts, calculations, etc. is not to be considered implicit or explicit investment advice. Nothing contained herein is a recommendation or solicitation to buy or sell any security. [ER] is not responsible under any circumstances for investment actions taken by the reader. [ER] has never been, and is not currently, a registered or licensed financial advisor or broker/dealer, investment advisor, stockbroker, trader, money manager, compliance or legal officer, and does not perform market making activities. [ER] is not directly employed by any company, group, organization, party or person. The shares of Portofino Resources are highly speculative, not suitable for all investors. Readers understand and agree that investments in small cap stocks can result in a 100% loss of invested funds. It is assumed and agreed upon by readers that they will consult with their own licensed or registered financial advisors before making any investment decisions.

Readers understand and agree that they must conduct their own due diligence above and beyond reading this article. While the author believes he’s diligent in screening out companies that, for any reasons whatsoever, are unattractive investment opportunities, he cannot guarantee that his efforts will (or have been) successful. [ER] is not responsible for any perceived, or actual, errors including, but not limited to, commentary, opinions, views, assumptions, reported facts & financial calculations, or for the completeness of this article or future content. [ER] is not expected or required to subsequently follow or cover events & news, or write about any particular company or topic. [ER] is not an expert in any company, industry sector or investment topic.

Epstein Research [ER] has no prior or existing relationship with Falcon Gold, but is pursuing a marketing relationship. Readers should consider this interview to be biased in favor of Falcon Gold. At the time this interview was posted, Peter Epstein of [ER] owned no shares of Falcon Gold.

( Companies Mentioned: FG:TSX.V,
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A Tale of Two Markets

Sector expert Michael Ballanger looks at how economic forces are pulling markets in contradictory directions.

By The Gold Report – Source: Michael Ballanger for Streetwise Reports   03/30/2020

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to Heaven, we were all going direct the other way.” —Charles Dickens

When I was in university in Saint Louis, I was once ordered by one of the Jesuit priests to submit a “review” of a book entitled “A Tale of Two Cities” by an author that I later grew to greatly admire, Charles Dickens of “A Christmas Carol” fame.

However, at the time, I had no interest whatsoever in picking up that book and opening its dust-ridden pages—unless, of course, it was shortly after midnight and lacking the sleep-inducing influence of draft beer and pizza, I needed a sedative. As vigorously as I might protest, the cassock-clad professor took me aside and explained in minute detail that this was anything but a “polite request.” Quite the opposite, this was a directive, an edict, an order, and failure to comply would result in a failing grade, a suspension from the varsity hockey team, and total personal humiliation, ignominy and disgrace.

Begrudgingly, I returned to my dormitory, cracked open a Bud, and with a sigh of resignation and gritty resolve, I tore into “A Tale of Two Cities,” an extraordinary novel written in 1859 but one whose opening paragraph (shown at the beginning) could have originated today in the mind of the author, given the surrealism of the events of the last three months. What I had rued as a totally unnecessary and agonizingly dull task turned into a delight, and the book remains one of my favorites of all time.

Watching this gaggle of TV-star politicians around the world scramble to try to halt the inevitable arrival of this economic winter is like watching the mighty Mississippi in the springtime overflow its banks, tossing aside sandbagged defenses as though they were Styrofoam coffee cups. As I opined last weekend, this Kilimanjaro of debt, amassed around the world in staggering size and reach over the past five decades, has now overrun its banks and threatens to flood the economic heartland with defaults, bankruptcies and massive unemployment. Painfully and predictably, the banco-politico elite have turned to their problem-solving toolkit and engaged the only implement they know—the printing press.

Even more excruciating than listening to these opportunistic counterfeiters is seeing the queue of corporate crybabies, complete with extended hands and pointed fingers, blaming the government-imposed shutdown on the demise of their company stock prices and accompanying destruction of their option-package enrichments. The cruise lines that operate out of tax-friendly Panama bellying up to the bar of taxpayer libation for relief packages is not only an outrage, it is an embarrassment. If the average breadwinner can squirrel away a few acorns for a rainy day or for a winter of frozen ground and lean pickings, why is the corporate world entitled to relief in the trillions and the average worker a month’s rent?

This is not just a Tale of Two Markets (and I’ll get to that in a moment), it is a Tale of Two Societies, the first being “entitled” and the second, “not so much.” After all, did we not just go through a self-inflicted immolation of the banking cartel and subsequent public bailout of same a mere twelve years ago? Did the corporate world not learn any degree of prudence during or since that time? Could that last $1.5 billion stock buyback (into which they exercised options and sold their stock resulting in massive self-enrichment) not have been delayed or avoided, and instead gone into a rainy-day war chest of sorts?

The actions of the US Treasury, Federal Reserve and Congress (and their Canadian and European counterparts) have unleashed the hounds of fiscal and monetary hell upon the world, with the term “moral hazard” standing out like a lighthouse beam at midnight. Sir Winston was so very much on-the-mark with his now-famous quote, “Never let a good crisis go to waste,” to the extent that there now exists an inverse correlation between decibel level of political and corporate wailing and the level of the Dow Jones Industrial Index. And if it weren’t so pathetic, it would be laughable.

Most markets found their footings last week, with gold, silver and the S&P all staging sharp reversals—but then again, it was an easy call with the Fear-Greed Index at “1.” Performance year to date has once again placed gold in the “outperformer” category (an event that must be driving White House economic advisor Larry Kudlow absolutely off his rocker). Gold has done exactly what it was supposed to do in times of turmoil, and while silver has not, it is still performing better than the S&P year to date.

Further, the March 17 COT report has finally tilted in favor of a silver rally, and it couldn’t happen at a more opportune time.

Of even greater significance is the performance of gold in non-US-dollar currencies and no better one to show than the Canadian dollar gold price which, for Canuck investors, has been a veritable nugget of safe-haven alpha for the prescient portfolio manager.

If you are an American investor looking for a currency play, the gold miners whose production is primarily in Canada or Australia (or both) are enjoying the dual benefits of weak domestic currency and weak energy. This allows a huge boost in revenue while expenses drop, and what falls out of the bottom is increased profits, the mother’s milk of all bull markets.

It was two weeks ago that I published the two charts of GDX and GDXJ with the caption “Generational Buying Opportunity.” The lows of that following Monday were textbook bottoms, with those purchases now serving to significantly repair the damage done by the silver takedown, an event I most surely did not expect.

I elected to go “all-in” with the Senior Gold Miner exchange-traded fund (ETF) (GDX:US), not because of any self-congratulatory “analysis” but because I totally missed the March 16 lows in the junior ETF (GDXJ:US), under US$20, because a) I was overly pessimistic about the opening price (I bid $16—idiot), and b) I was terrified. Actually, I have learned over the decades that fighting the terror of a knife-catching bottom is, if successful, a 100% winning trade and no better example was the GDXJ that day.

The only problem I have right now with the gold and silver miners is this: Will they, as “stocks” be able to decouple from the algobot-driven attack dogs that are controlling the broad stock market. With gold back in the US$1,600s and with oil around US$21, you could not get a more bullish fundamental backdrop for the gold producers. But as we know, when you are up against a swarm of bid-destroying algos, fundamentals don’t count, and therein lies the conundrum.

The stock market has bounced, but as I have preached for years, there is always a retest. If one looks back to 2009–2011, the bailouts occurred three months before the actual bottom, so I post the above chart not to frighten anyone but more as a reminder that the impact of this lockdown upon the global economy might be mild. But it might also be severe, and anyone who makes a prediction on his or her blog is only making a guess, because nobody has a clue, least of all me, as to the outcome.

From the chart shown above, I think that as far as the precious metals and their publicly traded brethren are concerned, we are somewhere between “fear” and “capitulation.” However, will a deflationary wave swamp the golden vessel, or will the hyperinflationary policy moves be a surfer’s dream? Only time will tell.

As for silver, the biggest question that I get from subscribers and followers constantly is why the GSR (gold-to-silver ratio) exploded to 130 when all the rocket scientist “analysts” have pounded the table in abject certainty that silver is in “shortage.” How can something in shortage be allowed to trade at US$14.50 in one market and $24.50 in another? How can retail websites be quoting one-ounce silver buffaloes at US$24.23? That is where the title of today’s missive comes in; this is “a tale of two markets.”

Years ago, I was at the Tinka Resources Ltd. (TK:TSX.V; TLD:FSE; TKRFF:OTCPK) booth and ran into a Glencore International Plc (GLEN:LSE) executive, and started to pitch him on TK’s Colquipucro silver deposit in Peru. The gentlemen listened to me patiently while I gave my version of “power close 101,” and why this 30-million-ounce open pit could be Glencore’s for the bargain basement price of CA$0.50 per share. After I finished yapping, he looked me and said, “All due respect, we really don’t have interest in your deposit. You see, we have slag heaps sitting idle from our copper-zinc operations that have five times that amount of silver.” The extent to which I was dumbfounded was exceeded only by the extent to which I was embarrassed and as I skulked away in near-mortal sheepishness, I thought to myself that I would never forget that conversation when thinking and talking about silver—which brings me to the point.

One look at the charts of copper and zinc and you can’t help but see a global economy under stress. You just know that with the prices of copper and zinc so depressed (and that was before COVID-19 showed up), the CEOs of these base metal giants must be under huge pressure to augment and enhance their forward guidance any way possible. Why then would a Glencore or a BHP Billiton Ltd. not mobilize those mountains of idle, slag-heap silver in order to bolster cash flow? There comes a point in any mining operation where the credit from byproduct ore becomes meaningful, and that is either from a spike in the value of the byproduct or a crash in the primary metal price.

I offer this as an opinion only. If JPMorgan are to be vilified as the manipulators of the silver price, the question remains whether they are acting on behalf of their prop desk (trading for the “house” account) or whether they are acting on behalf of one (or more) of these big base metal miners, whose eye sockets and nasal passages are bleeding from a dire cash flow deficiency.

Lastly, from the Dickens book, here is a passage most relevant to the demise of the average working man or woman:

“Repression is the only lasting philosophy. The dark deference of fear and slavery, my friend,” observed the Marquis, “will keep the dogs obedient to the whip, as long as this roof,” (looking up to it), “shuts out the sky.”

I would ask that you carefully consider those bolded words when you read or listen to the promises of these corporately compromised politicians who are throwing trillions of dollars of taxpayer confetti around like rice at an Italian wedding. They have seized upon this crisis in a manner no different than did Hank Paulson over a decade ago, under the guise of possible collapse of the financial system.

What we now know is that the only “collapse” that would have occurred was in the shareholders’ equity of the offending banks. Just as new growth springs back in burned-out forests, new equity would have rushed in to create new banks with little or no disruption to employment or “the system.”

So, as you see the line of imprudently run companies grunting and snorting up to the taxpayer trough this week, remember that this is all about the “two market” system. There is one market for the politically connected and another market for the politically insignificant, just as there is one market for buyers of actual gold and silver and another for the floggers of paper gold and silver.

Stated another way, there is nothing wrong with using the paper markets to try to increase the number of fiat dollars or euros or yen you own, because bills are paid in fiat and rarely in metal. However, if it is your intent to augment and protect your wealth—the fruits of years of labor and saving and prudence—then the only market you want to be in is the one that delivers physical gold and silver, because anything else is just an imposter.

There has never been a time in history when that shunning the imposters carried more urgency.

Article written on March 28.

Follow Michael Ballanger on Twitter @MiningJunkie.

Originally trained during the inflationary 1970s, Michael Ballanger is a graduate of Saint Louis University where he earned a Bachelor of Science in finance and a Bachelor of Art in marketing before completing post-graduate work at the Wharton School of Finance. With more than 30 years of experience as a junior mining and exploration specialist, as well as a solid background in corporate finance, Ballanger’s adherence to the concept of “Hard Assets” allows him to focus the practice on selecting opportunities in the global resource sector with emphasis on the precious metals exploration and development sector. Ballanger takes great pleasure in visiting mineral properties around the globe in the never-ending hunt for early-stage opportunities.

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Disclosure:
1) Statements and opinions expressed are the opinions of Michael Ballanger and not of Streetwise Reports or its officers. Michael Ballanger is wholly responsible for the validity of the statements. Streetwise Reports was not involved in any aspect of the article preparation. Michael Ballanger was not paid by Streetwise Reports LLC for this article. Streetwise Reports was not paid by the author to publish or syndicate this article.
2) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
3) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases.

Charts provided by the author.

Michael Ballanger Disclaimer:
This letter makes no guarantee or warranty on the accuracy or completeness of the data provided. Nothing contained herein is intended or shall be deemed to be investment advice, implied or otherwise. This letter represents my views and replicates trades that I am making but nothing more than that. Always consult your registered advisor to assist you with your investments. I accept no liability for any loss arising from the use of the data contained on this letter. Options and junior mining stocks contain a high level of risk that may result in the loss of part or all invested capital and therefore are suitable for experienced and professional investors and traders only. One should be familiar with the risks involved in junior mining and options trading and we recommend consulting a financial adviser if you feel you do not understand the risks involved.

Europe’s Coronavirus Contraction – Part I: From Missed Opportunities to Virus Escalation

By Dan Steinbock

– Today, the number of confirmed cases in Europe is more than four times as high as in China. It wasn’t an inevitable scenario. It is the result of complacency, inadequate preparedness and missed opportunities.   

Today, the epicenter of the novel coronavirus outbreaks is in the United States and Europe. In effect, more than half of all cases worldwide are in Europe.

Furthermore, Europe has over four times more cases than China.

How did this happen? How could it happen?

The first missed opportunity

At the end of January, the World Health Organization (WHO) declared the ongoing virus outbreak a “public health emergency of international concern.” The WHO was concerned about the possible effects of the virus, if it would spread to countries with weaker healthcare systems.

On February 4, WHO chief Dr. Tedros dropped a news bomb by stating publicly that it was the countries outside China that had been slow in sharing information about cases. After a month of international crisis and a global alert, a stunning three of five member countries had failed to provide adequate case information to WHO. Those reports were vital to assess the international scope of the outbreak and to contain it.

Instead of mobilization, major European economies followed the virus crisis as if it was a “Chinese problem.”

The complacency was compounded by the concurrent media coverage, which was often sensational and misguided contributing to the “infodemic.” Still worse, instead of preparing against the virus, public debate began an odd battle against the WHO, its chief and some of his right-hand executives thereby compounding the inadequate preparedness (see my “The Strange War with WHO’s Battle Against COVID-19”, The World Financial Review, Feb 14, 2020).

As the timeline suggests, it was this missed first month that led to the confirmed cases soaring outside China after February 4 (Figure).

Figure      The Human Costs of Europe’s Coronavirus Complacency*

* Confirmed COVID-19 cases worldwide through March 29 2020

Source: WHO, Difference Group.

Yet, the writing was on the wall. In China, a “mystery pneumonia” of unknown etiology was first identified in Wuhan by the end of December. At the onset of January, the WHO had been informed about the new virus. And by January 10, scientists in China sequenced the virus’s genome and made it available. With SARS this work had taken months; now only a month.

After mid-January, Beijing initiated the draconian measures to contain the virus and the story was all over in international headlines.

In the United States, the first coronavirus case was identified on January 20. In Europe, the first cases were detected just days later, on January 24, in Bordeaux and Paris, along with a cluster of infections that was discovered in Haute-Savoie. In Germany, the first case was confirmed on January 27; in Italy, four days later; in Spain and the UK, on January 31.

And yet, thereafter, weeks of mobilization were missed as major European countries hoped for the best but didn’t prepare for the worst. That odd state of waiting prevailed until a dramatic escalation ensued in Italy on February 21, when a cluster of cases was confirmed cases in Lombardy, followed by another acceleration in Spain just three days later.

That’s how Inadequate preparedness ensured the virus a free ride, which resulted in an explosion of local transmissions in late February. By then, Italy had few alternatives but to adopt the Chinese strategy of shutting down cities and banning social activities, strictly isolating infected people. Only weeks before, many European leaders had criticized such measures as “autocratic” and “counter-productive.” Now they rushed to adopt them.

At the turn of April, confirmed cases worldwide exceeded 650,000, while those in Italy were approaching 100,000; in Spain, 75,000; Germany, 55,000; France, 40,000; and the UK 20,000. Combined, these five European countries alone had more than twice as many cases as the U.S.

Here’s the inconvenient truth about the first missed opportunity: When Dr Tedros delivered his news bomb on February 4, there were only 25 confirmed cases in Europe. When serious mobilization began around mid-March, the number of those cases had exploded more than 1000-fold to 28,000 in the five major European economies, while the total had soared to about 35,000. Today, at the start of April, those cases have increased 10-fold in major European economies and the region as a whole – in the former case, to 270,000 and in the latter, to some 360,000.

Worse, another missed opportunity may loom ahead.

Toward a second missed opportunity?

As mobilization began belatedly, some European leaders tried to frame inadequate preparedness as a foresighted strategy. In the UK, Prime Minister Boris Johnson stated that “we can turn the tide within the next 12 weeks.” In mid-March, he added that schools would stay open. He advised people with symptoms to stay at home for a week and advised seniors over the age of 70 to avoid certain activities.

Relying on the advice of some epidemiologists, Johnson began to advocate “herd immunity” as the new strategy. Basically, the idea is that, within a certain group of people, the circulation of diseases can be stopped after enough are infected and gain immunity. If, say, two thirds of people in a group have immunity, the number of people a sick person can infect will plunge below one. And that will bring the disease under control.

The idea is presented as a “realistic” solution. Since tight control and isolation strategies may not work anymore, the virus is already spread all around the world.

It is not a new idea, however. It was first deployed in the 1920s and recognized as a recurring phenomenon in the 1930s when, after a significant number of children had become immune to measles, new infections temporarily decreased. Subsequently, mass vaccination to induce herd immunity became common.

Unfortunately, in the coronavirus crisis, the idea of the herd immunity may imply the kind of medication that has potential to worsen the crisis. After all, there is no vaccine yet and it may take a year or longer to develop. So, if resignation is disguised as a strategy, it is likely to condemn major risk groups – the elderly, those with chronic pulmonary conditions, hypertension, diabetes and asthma patients, and those without adequate access to affordable health care – into a premature death.

Worse, whatever happens in Europe will not stay in region. In a global, inter-connected economy, all countries are linked. And with pandemics, the weakest links determine the future of the whole, through flows of world trade, investment and particularly migration and tourism.

If major European countries opt for the herd immunity scenario, it would be naïve to expect the virus to disappear by early summer (that’s the current expectation). It could easily last into the fall and well into 2021. As a result, human costs would soar, while economic devastation would spread deeper and broader.

In that scenario, herd immunity would signal a second missed opportunity.

About the Author:

Dr. Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (USA), Shanghai Institutes for International Studies (China) and the EU Center (Singapore). For more, see https://www.differencegroup.net  For recent coronavirus briefings, see https://www.differencegroup.net/coronavirus-briefs

This is the first part of the commentary that was released by The European Financial Review on March 31, 2020

 

Weakness Appears To Be Setting For This Weeks Economic Data

By TheTechnicalTraders 

– As the world reacts to the global economic slowdown because of the COVID-19 virus event and the massive stimulus programs and central bank efforts to support the global economy, investors still expect weakness in the US and foreign markets.  We believe this expected weakness will not subside until news of a proper resolution to this virus event is rooted in the minds of investors and global markets.

Hong Kong and China are currently concerned about experiencing a “third wave” of the COVID-19 virus within their society.  As the economies open back up to somewhat normal, people are very concerned that a renewed wave of new infections will suddenly appear and potentially result in another shut-down event or infectious cycle?  We believe all nations are watching what is happening in Hong Kong and China as they attempt to reopen their economies.

The rest of the world is still battling the rising infection rates and dealing with the economic shutdowns that have brought the global economy to its knees.  Europe, Japan, Canada, and the US are all experiencing vast disruptions to their economies and commodity prices and demand expectations are collapsing as a result.

Nearly a week ago, we issued a research article that suggested our proprietary Fibonacci Price Modeling tool’s key resistance levels may become a very valid ceiling for any price recovery.  It appears this is happening in the markets as the NQ Daily chart, below, shows.

Before you continue, be sure to opt-in to our free market trend signals 
before closing this page, so you don’t miss our next special report!

Daily Nasdaq (NQ) Chart

The NQ resistance level, near 7880, has acted as a soft ceiling in the NQ over the past 4+ trading days.  Today, the NQ briefly rallied above this level, then rotated downward below this level again to confirm this key resistance level.  We believe this critical Fibonacci resistance level may continue to act as a price ceiling over the next few trading days and push prices lower as economic news and expectations hit the news this week and next.

The next downside price target for the NQ is 6565 – new price lows.

If you have not seen this important technical analysis on the Nasdaq which I posted a couple of days ago, be sure to see these charts.

SP500 (ES) Weekly Chart

This ES Weekly chart illustrates another key resistance level near 2679.  Although the ES price has not rallied up to reach this critical Fibonacci resistance level, we still believe this level is acting as a price ceiling and that the ES will weaken as future expectations are confirmed by earnings data, economic data and other collateral damage to the global economy.

We are still very early in understanding the total scope of this virus event.  The US and other global central banks are attempting to front-run any weakened expectations as a result of this virus event.  We continue to believe the extended collateral damage to the consumer, business and other aspects of the economy are yet to come.  Most recently, consumer delinquencies have begun to skyrocket and the news is being printed about landlords and renters being unable to satisfy obligations on April 1st.

This is part of the reason why we believe further caution is warranted at this time in the markets. We issued an Important Trade and Investment Alert Yesterday.

Our research team believes a deeper price low will likely set up over the next 30+ days to establish a true price bottom.  As we’ve warned, we believe extended collateral damage to the US and global economy will soon become better understood and the extended shutdown of the US and other economies only manages to complicate any positive expectations for a bottom.

We believe a deeper price low will set up within the next 30+ days and we urge skilled traders to pay attention to the broader expectations of the markets.  Earnings data and other economic data will continue to stream into the news centers over the next 30+ days.  Don’t get too aggressive with trying to buy a bottom in the markets just yet.  Be patient and wait for the markets to show you when the bottom has really setup.

As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for short-term swing traders.

I hope you found this informative, and if you would like to get a pre-market video every day before the opening bell, along with my trade alerts visit my Active ETF Trading Newsletter. If you are a long-term investor looking for signals when to own equities, bonds, or cash, be sure to look into my Long-Term Investing Signals.

Ride my coattails as I navigate these financial markets and build wealth while others lose nearly everything they own during the next financial crisis.

Chris Vermeulen
Chief Market Strategist
TheTechnicalTraders.com

 

Stocks: When Grass Looks Greener on the Other Side of the … Pond

By Elliott Wave International

Let’s start by establishing that the stock market is not driven by the news. Aggregate stock prices are driven by waves of optimism and pessimism — which go from one extreme to another — as reflected by the Elliott wave model. That’s what makes the stock market predictable.

Hence, Elliott wave analysis is at the core of EWI’s stock market forecasts.

Having said that, sentiment indicators are also valuable in providing clues about “what’s next.”

For example, Robert Prechter’s book, Prechter’s Perspective, made this observation:

No crowd buys stocks of other countries intelligently. For decades, heavy foreign buying in the U.S. stock market has served as an excellent indicator of major tops.

Well, in the year 2000, that’s exactly what happened. Foreign purchases of U.S. shares spiked to a then record $402 billion in March 2000. The spike in foreign buying coincided precisely with a price peak in the S&P 500. From the month of the high in March 2000 through October 2002, the S&P declined 51%.

Fast forward to December 2019, when our Elliott Wave Financial Forecast showed two charts related to overseas buying of U.S. shares. Here’s the first one:

This chart notes our discussion about foreign buying in the year 2000 and also in August 2007: “The first five months of [2007] produced what was easily the biggest gusher of net foreign buying in history. The record suggests that falling prices lie directly ahead for the U.S. market.”

The historic stock market top of 2007 occurred just two months later.

Here’s the second chart from the December 2019 Elliott Wave Financial Forecast, along with the commentary:

The chart of foreign holdings of U.S. stocks shows a new record of $7.7 trillion in total stock holdings as of July [2019]. On November 7, The Wall Street Journal reported that the “appetite for U.S. shares among international clients has shown few signs of abating.” Foreigners are all in on the U.S. stock market rally. Our bet is that it will end in a major top just as it did in 2000 and 2007.

Plus, the Elliott wave model was also indicating that the stock market top was approaching. The Jan. 2020 Elliott Wave Financial Forecast noted:

The rally is the final [wave] of the bull market.

The February 2020 stock market top occurred just a month later.

As you know, historic stock market volatility has unfolded since then. Interestingly, during highly emotional markets — such as what investors face now — Elliott waves tend to be clear.

So, now is the ideal time to learn all you can about the Elliott wave method of analyzing and forecasting financial markets.

You can do so free!

You see, when you signup for a free Club EWI membership, you get instant, free access to the online version of the book, Elliott Wave Principle: Key to Market Behavior, by Frost & Prechter. You can have this Wall Street classic on your computer screen in just moments!

Technical Analyst: Silver Looks Bearish Short to Medium Term

Technical analyst Clive Maund charts silver and explains why he is bearish in the short to medium term.

By The Gold Report – Source: Clive Maund for Streetwise Reports   03/30/2020

Whichever way you cut it, silver’s chart looks bearish for the short to medium term, but against this we must set its rapidly improving COT structure and the mega-bullish silver to gold ratio (by all past standards).

Silver’s 7-month chart is a rather grim picture. On it we see that key support failed this month, leading to a dramatic plunge to new lows, and this support has now become resistance. In addition we see that moving averages have swung into bearish alignment, with a bearish “death cross” having occurred about a week ago. The relief rally of the past week or so in sympathy with the relief rally in the broad stock market fueled by Fed intervention, that we predicted and played via leveraged silver ETFs and Calls, is therefore thought to be petering out and set to be followed by another probably steep selloff, congruent with another decline in the broad stock market, and a potentially heavy decline in the precious metals sector.


This month’s dramatic failure of key support at the lows was a hammer blow to investors in the sector and it’s easy to see why on the latest 11-year chart for silver. This support failure crashed multi-year lows dating back to early 2016, and aborted the potential giant Double Bottom pattern – it is precisely the sort of development that would lead silver bugs to give up in disgust and disgorge their holdings in despair to Smart Money waiting patiently to scoop them up at rock bottom prices.


For as we can see on the latest silver COT chart, the faithful are giving up in droves and heading for the hills – with the Large Specs’ holdings ebbing away steadily. With the shorter-term charts for silver pointing to further losses dead ahead, we can expect to see considerable further improvement in this COT structure which will finally set the stage for the expected humongous silver bull market.


Why humongous? – here’s why: the silver to gold ratio has dropped to a record low by a wide margin this month, and is way below lows that in the past have been the precursor to major sector bull markets. This is why, after the stock market crash phase is done, and maybe even a little before, silver is expected to reverse to the upside in a spectacular manner and take off like a rocket, and there is a precedent for this behavior, for this is what happened near to the bottom of the 2008 market crash. The difference this time is that the situation is much more extreme and the upside potential much greater than it was back then. So we will be keeping a very close eye on silver going forward.


The conclusion is that silver looks set to drop hard over a short to medium-term time horizon with the broad stock market but in the larger scheme of things it is setting up for a massive and probably spectacular bull market that is likely to commence with a screaming rally when the time is right that will probably blow straight through the failed support, now resistance, shown on our 7-month chart . This should not come as a surprise when you consider what is set to be done – and is already being done – to fiat currencies going forward.

Originally posted on clivemaund.com on March 29, 2020.

Clive Maund has been president of www.clivemaund.com, a successful resource sector website, since its inception in 2003. He has 30 years’ experience in technical analysis and has worked for banks, commodity brokers and stockbrokers in the City of London. He holds a Diploma in Technical Analysis from the UK Society of Technical Analysts.

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The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.