Charts from 10:30 New York time this morning. As a reminder tomorrow is the stock options 'quad witching' expiration.
Stocks look overdue for a pullback, with 1100 providing a key support, and below that around 1090. We're back on the 'short stocks / long gold' trade as of yesterday, believing that the stock rally was artificial and support for the IPO's rolling out under the careful guidance of Mother Goldman.
"In today’s exchanges, strong programs prey on weak ones, humans are hard to find, and the SEC struggles to keep up."
Monsters in the Market, the Atlantic, July 2010
The 'handle' on the gold chart is very well defined, and gold is making a strong move higher this morning in an attempt to break out. I do not suspect it will be successful so easily, but once it does it may gap higher overnight and then say goodbye to these price levels. There are powerful interests which do not like to see gold move higher just yet, because it creates doubt in their financial engineering. Larry Summer's documented this effect in his paper on Gibson's Paradox. Greenspan was right so many years ago when he said that statists hate gold, because it provides a safe haven for the individual, and a stumbling block to the powerful.
Net Asset Values of Certain Precious Metal Funds and Trusts
The premium on GTU continues to be compresses because of the large secondary offering of units. That should be completed on June 23. We would expect the premium to revert to the mean, closer to 8%, once the shares are sorted out.
NAV Added later, as is indicated by the time stamp.
