Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Gold Gets Hammered But Copper Fails To Seize The Moment

By Gary TanashianCommoditiesSep 17, 2021 05:46PM ET
www.investing.com/analysis/gold-gets-hammered-but-copper-fails-to-seize-the-moment-200602308
Gold Gets Hammered But Copper Fails To Seize The Moment
By Gary Tanashian   |  Sep 17, 2021 05:46PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

The Copper/Gold ratio remains at a key decision point

Gold has been clobbered lately, but a key metallic macro indicator remains in a long-term congestion zone. If it’s going to be cyclical ‘inflation ON’ we’d expect Cu/Au to break through and do what it has not done since a major inflation trade blew out in 2006-2008, and for the 30-year Treasury yield to eventually catch on and rise at least to the EMA 100 (blue line).

Copper:Gold Ratio.
Copper:Gold Ratio.

Here is the daily futures view of Cu/Au. Going by simple TA (daily trends) it looks poised to break out to the upside, especially in the face of a government at the ready to pump trillions more funny munny into the economy. The economically cyclical metal would benefit over the more counter-cyclical monetary metal. It’s logical, but still theoretical. Markets do not always do the logical thing, now do they?

Copper:Gold Ratio.
Copper:Gold Ratio.

A couple of important macro riders are in a ‘beg to differ’ stance. The bringers of liquidity destruction to the inflated mess, the 2 Horsemen of the (would-be) Apocalypse ride on.

The U.S. dollar has thus far maintained its base/bottom situation.

U.S. Dollar Index.
U.S. Dollar Index.

…while the gold/silver ratio is doing something similar.

Gold-Silver Ratio.
Gold-Silver Ratio.

You’ve got to ask yourself one question. ‘Do I feel lucky?’ Well, do ya, punk? Fellow old timers will recall that Dirty Harry’s .44 Magnum was actually empty, but the punk chickened out and gave up. That was the only rational choice in real time, but it was wrong.

If you feel lucky, you’ll guess about the outcome of a short-term macro question. A real gamble. But in the financial markets you don’t need luck so much as you need to do the work to be on the right side of the macro (top down) backdrop. You may miss the initial push, but if a new and sustainable phase engages there will be plenty of time to get on it with better backing from the indicators. Otherwise, you can end up like legions of inflationist gold bugs today, watching gold, silver and the miners drop again despite the dogma held so dear by the average bug.

If you feel cold, calculating, rational maybe, you’ll wait for the macro signals before acting strongly in a given direction.

When the macro confirms (inflation) or turns (temporarily to liquidation), the opportunities ahead are going to be much better than the little day trading scalps the current market is providing.

Gold Gets Hammered But Copper Fails To Seize The Moment
 

Related Articles

Phil Flynn
The Energy Report: Welcome To The $3 Club By Phil Flynn - Oct 25, 2021 2

Who said U.S. President Joe Biden’s policies would not increase gasoline prices? For anyone who paid any attention at all, that fact was obvious. While “fact-checkers” for major...

Gold Gets Hammered But Copper Fails To Seize The Moment

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (2)
suthar sevanti
suthar sevanti Sep 19, 2021 3:13AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
xag/usd doun ya up
Stuart Laubscher
Stuey Sep 18, 2021 5:41AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Great article, waiting for the overdue big wave!
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: We do not recommend you invest or trade based upon our commentary, analysis and opinion. Please see NFTRH.com and Biiwii.com terms of service.
Continue with Google
or
Sign up with Email