Chart of the Week – A revisit to an interesting chart

Stock of the Week – A junior silver miner

D.C.

This week…

• The stock market suffered its worst one week loss since the financial crisis of 2008. The loss was triggered by the ongoing European crisis and negative comments from the Federal Reserve. The stock market rebounded on Friday as the G20 and the ECB pledged to extend further assistance.

• US bonds rallied to new all-time highs as the both the US$ and US bonds remained a safe haven. The rush to new highs seemed to negate the previous week’s outside key reversal week. However, Cdn bonds did not do the same. US bonds fell on Friday following the pledge of assistance from the G20 and the ECB.

• Gold was “hammered” down while silver was “slaughtered”. NOTE: TC has an extended write up on the cycles at play for both gold and silver. The current drop seems to suggest that both gold and silver are falling into a one third cycle low of a larger cycle. If that is the case then once the low is established both gold and silver could move to new highs for the current up cycle.

• Oil prices fell on the fears of recession. It is currently holding support near $80 although a break and close under that level suggests that even lower prices towards $70 are possible. Natural gas continues to be very weak. The oil and gas stocks broke down out of bearish triangles.

• The TSX Composite also fell sharply this past week. Of all of the sub indices only Gold appears to be holding an uptrend while some other sub sectors that have performed relatively well are showing topping formations.

D.C.

Stock of the Week – A sinking bank

Technical Scoop – The 9/11 decade

D.C.

This week…

• The markets were spurred higher this past week as the western central banks announced a huge liquidity injection into the Euro zone. The week also saw the announcement from UBS Bank that a rogue trader had lost $2 billion. This is the first rogue trader in a few years. How one can hide a $2 billion loss in this day of sophisticated back office systems and risk manager overseers is beyond comprehension.

• With the stocks up the bond market had an outside key reversal week. This could be signalling a major top in bonds as TC has been looking for the possible 6 year cycle peak. The next few weeks should tell whether this key reversal week, that came at all-time highs, holds.

• Gold continued its recent correction but bounced back strongly at week’s end. Gold still appears to be forming a corrective pattern to the recent strong rise that should end no later than sometime in October. The market rebounded this past week from a higher low and that could be suggesting the potential for a five wave ABCDE type corrective pattern. The US$ Index reversed to the downside as the central bank injections helped buoy the Euro.

• Oil prices once again failed just above the $90 level. The market appears to be forming a bearish pattern and could fall back towards $80.

• The TSX Composite was down on the week going against the strong up week seen by the S&P 500 and the NASDAQ.

D.C.

Chart of the Week – Dow/Gold ratio revisited

Stock of the Week – A conservative silver stock play

D.C.

This week…

• The S&P 500 failed the recent highs and fell sharply on Friday pushed down by the ongoing turmoil in Europe and the threat of a Greek debt default. The sudden resignation of a key ECB official also negatively impacted the market.

• Bonds once again went to a new highs as US government bonds continued to act as a safe haven amongst the debt turmoil. However, given the overbought nature of the market and a market possibly seeking the 6 year cycle high it is potentially dangerous to step into the market now. Long US bonds made new all-time highs above the one seen in December 2008 at the height of the Lehman Brothers panic.

• Gold failed to rise this past week, however, the gold stocks were one of the few bright spots during the week. Gold stocks often lead gold to the upside. This has not been the case for sometime so this is a possible positive sign for gold going forward. Until new highs are seen above $1910 there remains some risk that gold could probe lower first.

• Oil prices tried to rise earlier in the week, however, with continued signs of a weakening global economy oil prices once again failed near $90 and pulled back on the week even though they eked out some gains. The energy stocks, however, did not gain and fell along with the broader market. The energy stocks look particularly weak and are close to new 52 week lows.

• The TSX Composite fell on the week as well with only the Gold sub index managing any substantive gains. Telecommunications and Income Trusts eked out small gains.

D.C.

Chart of the Week – Gold in a bubble?

Stock of the Week – Bottom fishing for a gold stock.

D.C.

This week…

• Did the markets top with the release of the nonfarm payroll on Friday? Some cycles suggest it could be a top. European markets were swooning on Monday with concerns for the US economy and the European economy and the European debt mess. The drop Friday wiped out gains on the week. Cycles are pointed down. A discussion of the longer term cycles at play is included. Given the start to the week in Europe the coming week does not look positive.

• Bonds rose this past week on the weak job data. But given that US long bonds are in the vicinity of the 2008 top the current 6 year cycle that last bottomed in 2007 could be making a top.

• Gold soared on the week in all currencies. It appears gold may be shaking off the apparent key reversal week seen the previous week. New highs above $1910 would confirm that. Currently the market is flirting with those highs. Silver also had a good week as did the other precious metals. The Gold Bugs Index (HUI) broke out to new highs boding well for the gold stocks going forward.

• Oil prices rose then fell with the weak job numbers. Oil prices are still vulnerable to further declines but the risk of war in the Mid-East keeps a premium on the market.

• The TSX managed a gain on the week but it was primarily because of golds. Telecommunications and Income Trusts also had up weeks.

D.C.