Silver has been the “performer” this year. The silver/gold ratio is hitting levels not seen since September 2011. The ratio is reaching some important levels,but are there implication for the risk on/off mood?
The GOLD-SILVER RATIO drops to its lowest level since September 2011 (48.50), testing the ratio’s 200DMA at 48.50 (and 400DMA which also intersects at this level). A falling ratio means more demand for Silver than Gold ($1800 : $37) To put this in perspective it is estimated that governments at present only hold at most 60 million ounces of silver, as compared with 1 billion ounces of gold.
Meeting on/off confusing jittery investors. Markets have been showing signs of fatigue, as we posted yesterday. Below quick update. We are still in the positive Trend Channel, but the rising wedge just got punctuated. With all the short covering we have witnessed during the past weeks, this sell off could be the start of a bigger correction. Don’t forget to check out the 08/11 comparison.
Markets trading in a risk off mood today. Volumes are light, but the moves are rather big. With volatility crushed over the last days, people will start feeling nervousness creeping up again. As usual, people have sold volatility in “panic”, and will be very surprised if we see SPX 100 handles lower. We believe yesterday was a nice last short covering panic.
Below some short term charts, and for those saying HFT don’t trade currencies, review the charts below…
SPX Trend Channel, market is losing steam.
Guest Post by the MoreLivers.
Terrible week in the markets, no hope, only delusion, denial, empty promises, one more drink, one more turn, I will never hit you again. None of it is true anymore. Four weeks ago it used to be that the price was the news, in absence of solid, trustworthy politicians and central bankers. Price was followed, as it knew what was what. Now all markets are manipulated, squeezed, closed, restricted or kept in the dark. Market participants have no news, no prices and no statements or rules, so now rumors of rumors are moving the markets.
On Tuesday the Greek parliament will vote on austerity measures. The end result is uncertain, and if the parliament says no, the EU bailouts agreed on 21st July are not happening. They might be stupid enough to vote no and learn to eat stones and fight regional wars, or brave enough to vote no, as in this game of chicken the Germans, French and the ECB have more to lose. I gave my odds for Greek default here one week ago. I see no reason to change my view.
At some day, at some point, someone will uncover how much the banks have paid the European politicians to get recapitalization without participation and then put the full burden of their self-inflicted crisis on tax payers and austerity-ridden PIIGS. At that point these people have no political future, respect or security.
Joke of the day: “While the first ten years of the euro have been a success, the crisis exposed a number of shortcomings in the policy framework.” – Statement of Commissioner Olli Rehn to IMF committee – IMF (pdf)
Dear Olli, where, how much and when the euro was a success, and at what total cost? Go f**k yourself, Olli.
Joke of the day 2: Van Rompuy paints rosy picture of EU at first-ever UN speech – euobserver.com
This speech is so delusional that I cannot say anything about it. Has he passed the Voight-Kampff-test?
Then to the links, plenty of stuff and no fillers.As per your feedback, I’ve added “editorial content” and in link summaries also bring forth my view on the topic. Bookmark now, read later if you have to. Feedback would be much appreciated – what do you find most useful here? Leave a comment, follow me on Twitter or email me.
** Evening summary: Friday Watch – Between The Hedges
Morning summary: Morning Take-Out – DealBook / NYT
Emerging markets: The weekender – beyondbrics / FT
All EM currencies hit, IMF warns about corporate debt risks. Let’s see what all of this will do the public sector deficits in the near future.
For much more, continue below.