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Weekly: Gold Likes QT, Tesla May Have Just Lied

Weekly: Gold Likes QT, Tesla May Have Just Lied

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VBL
Apr 24, 2022
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Weekly: Gold Likes QT, Tesla May Have Just Lied
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Housekeeping:  Many will be receiving GoldFix Weekly for the first time. It is different than the dailies. This post is more like a magazine. Content touches many areas of markets. The index may help.

Subscribe and Get a Free Week

Founder’s Class : 3 p.m. SUNDAY: Preview and Zoom Link Here. There will be an outline email tomorrow


SECTIONS

  1. Market Summary

  2. Technicals

  3. Podcasts

  4. Calendar

  5. Charts

    Premium divider

  6. Precious

  7. Research Recap


1. Market Summary

The was the last week before Fed speakers enter their blackout period before a policy meeting. They cannot discuss things publicly between now and then. So they made sure they went out on a low note influentially. All week Ultra-hawkish FedSpeak sent rate-hike expectations up with 50bps fully priced-in for May, and a 35% chance of a 75bps hike in June now.

Stocks finally got a message the Fed is seriously going to sacrifice asset prices for inflation risk. The result: This is the 3rd week in a row that a 'balanced' (60/40 mix) portfolio of stocks and bonds was damaged.

Different Rate Hike Expectations End With Quick Easing

Friday was a bloodbath for stocks broadly with no divergence as all the majors tumbled over 2.5%. Despite this and bloodbath in bonds, Treasuries are at their cheapest relative to stocks since 2011.

  • The Dow fell over 1000 points from high to low

  • Nasdaq was the week's biggest loser

Global Equities by Region

Sectors:

  • Energy was worst on the week

  • Staples were the only sector to close green

  • Healthcare stocks hammered

  • Airline industry rebounded

Commodities:

  • Commodities were broadly lower on the week

  • Silver and crude suffered most

  • Gold ended the week lower after tagging $2000. It remains well above the price before Putin’s invasion of Ukraine

The Chinese Yuan started to play cahtch up with the Yen weakening these past few weeks.

The Yen, lower graph, was weakend in 2014 and the Yuan had to follow suit to stay competitive in the region. It is too early to tell, but that could be happening again.

Bonds:

  • Bonds were dumped on this week from top to bottom of the yield curve

  • Short term rates spiked the most in a bear flattening

  • The Dollar continued to surge higher this week (3rd weekly gain in a row)

Crypto:

  • Cryptos (risk on Gold) were all lower on the week as they tracked risk assets

  • Bitcoin $43k only to tumble back below $40k.

GoldFix Friday WatchList:

Complete Watchlist Here


2. Technical Analysis

Report Excerpts Courtesy MoorAnalytics.com

GoldFix Note: Do not attempt to use price levels without symbol explanations or context. Moor sends 2 reports daily on each commodity they cover. The attached are non-actionable summaries.

Gold

TECHNICALLY BASED MARKET ANALYSIS AND ACTIONABLE TRADING SUGGESTIONS

TECHNICALLY BASED MARKET ANALYSIS AND ACTIONABLE TRADING SUGGESTIONS Moor Analytics produces technically based market analysis and actionable trading suggestions. These are sent to clients twice daily, pre-open and post close, and range from intra-day to multi-week trading suggestions. www.mooranalytics.com

Energy

Bitcoin

Go to MoorAnalytics.com for 2 weeks Gold, Oil, and Bitcoin reports free


3. GoldFix and Bitcoin Podcasts

Fed Effect, Y2K flashback, Walkthrough of Moor Charts

Twitter avatar for @VlanciPictures
VBL @VlanciPictures
GoldFix Podcast April 22, 2022 6:34 Mkts-fed effect, Silver bounce 8:30-Founders Class Sunday: Y2K/Ashanti Gold "story" 11:00-China Yuan/Yen Trade, ZH Reit trade 11:53-Moor Levels and How to use them today, GoldFix interpretation Bear/Bull trades https://t.co/XlJ0t5oVS3
11:43 AM ∙ Apr 22, 2022
8Likes2Retweets
  • GoldFix Broadcasts HERE

The New Push to make Bitcoin Illegal in Europe

Twitter avatar for @VlanciPictures
VBL @VlanciPictures
#Bitcoin Podcast April 21, 2022 0:55- levels **4:00-the new energy pushback against Bitcoin is coming** How they will come at it https://t.co/DtVJNuO2OG
11:55 AM ∙ Apr 21, 2022
  • Bitcoin Podcasts HERE


4. Calendar

Some upcoming key data releases and market events

MONDAY, APRIL 25 None scheduled

TUESDAY, APRIL 26

  • 8:30 am Durable goods orders March -- -2.1%

  • 8:30 am Core capital equipment orders March -- -0.2%

  • 9 am S&P Case-Shiller U.S. home price index (year-over-year) Feb. -- 19.2%

  • 9 am FHFA U.S. home price index (year-over-year) Feb. -- 18.2%

  • 10 am Consumer confidence index April -- 107.2

  • 10 am New home sales (SAAR) March -- 772,000

WEDNESDAY, APRIL 27

  • 8:30 am Advance report on international trade in goods March $106.6 BB

  • 10 am Pending home sales index March -- -4.1%

  • 10 am Home ownership rate (NSA) Q1 -- 65.5%

THURSDAY, APRIL 28

  • 8:30 am Initial jobless claims April 23 -- N/A

  • 8:30 am Continuing jobless claims April 16 -- N/A

  • 8:30 am Real gross domestic product (SAAR) (first estimate) Q1 -- 6.9%

FRIDAY, APRIL 29

  • 8:30 am Employment cost index Q1 -- 1.0%

  • 8:30 am PCE price index March -- 0.6%

  • 8:30 am Core PCE price index March -- 0.4%

  • 8:30 am PCE price index (year-over-year) March -- 6.4%

  • 8:30 am Core PCE price index (year-over-year) March -- 5.4%

  • 8:30 am Nominal personal income March -- 0.5%

  • 8:30 am Nominal consumer spending March -- 0.2%

  • 8:30 am Real disposable incomes March -- -0.2%

  • 8:30 am Real consumer spending March -- -0.4%

  • 9:45 am Chicago PMI April -- 62.9

  • 10 am UMich consumer sentiment index (final) April -- 65.7

  • 10 am UMich 5-year inflation expectations April -- 3.0%

Main Source: MarketWatch


5. Charts

Dollar Index

Gold

Silver

Oil

Nat Gas

Charts by GoldFix using TradingView.com


6. Analysis:

For the last few months, we’ve all been trying to process the fallout of life changing events that have come one on top of the other the last two years. Crisis after global crisis.

Markets have had to constantly digest secular events and massive disruptive trends like: the Covid Pandemic and government’s knee-jerk reaction to it; the resultant supply-chain inflation and more knee-jerk reactions1.

The thing is, none of these events has resolved yet. All are still ongoing. Now it is time to finally see how policy reactions to those events are going to effect the markets for the next few month or so.

That is the pattern we’re seeing in the financial media now anyway. Let’s hope the upcoming policy reactions aren’t as bad as the knee-jerk reactions before.

7. Research:

  • Gold: Goldman Sachs just says to keep buying it.

Moreover, underling bullish drivers of each of the three categories are set to remain for the rest of the year, meaning that the bullish gold price trend is set to continue. We therefore reiterate our year-end price target of $2500"

  • Gold: Fear Trade Is Losing Momentum- TD Bank

How sustainable is the flood of capital finding its way into gold? Thus far, the yellow metal's prices have remained extremely resilient against an aggressively hawkish Fed, as a protracted war in Ukraine simultaneously raised both geopolitical uncertainty and inflation risks, thereby fueling demand for the yellowmetal as a safe haven.

While the Fed is signaling its intent to combat inflation by reaching policy neutrality by year-end, and to start an aggressive QT regime, outflows from gold markets have been scarce as participants are happy to retain some optionality against the Fed's stated plan amid growth concerns.

After all, some also believe the US central bank is still behind the curve, effectively pricing in the Fed's inability to tame inflation with its currentplan, and highlighting the large gap between the current policy setting and the neutral rate.

The risk: safe-haven flows are likely to subside as the fear trade dissipates, leaving fewer participants left to buy gold.

GoldFix: Which is all fine as long as producer selling does not return. Look for open interest to decline with a selloff. If they canget new Comex shorts back into the market, new fuel will be there for another run.

  • Tesla Just Went Ex-Growth; the Difference, in our Opinion, is They Lied About It- GLJ

In short, we believe E. Musk saw the move in Netflix's stock ex-growth in yesterday's trading session, and wanted to paint a picture that, no matter what, TSLA will not go exgrowth, on a unit sales basis, in 2Q22 (we believe his forecast here will prove [very] wrong)

  • Commodity Inflation: Raising rates will definitely not be enough in LATAM- Soc Gen

  • Recession: Seems to be a given by many, including us, but some are now making the case a soft landing isn’t impossible- Goldman Sachs

  • Commodity Inflation: Raising rates will be enough if they get real rates positive unless they stop lending money during QT….. TS Lombard

More at bottom…

Zen Moment:

Twitter avatar for @cctv_idiots
CCTV_IDIOTS @cctv_idiots
Elephant prankster 🐘 😂 wait for it!
7:18 AM ∙ Apr 23, 2022
21,407Likes3,389Retweets

***More Analysis Below Line***


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