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Metals reversals
Hi Bill! How the banks must be furious with DT today! I think the plan was running according to the script all week, as the commercials faded every rally and capped the metals, confident that they could roll out the bazooka on FED day and slam the entire sector. Slam they did, but the plan went off the rails about 2pm today. As Mike Tyson once stated, everyone has a plan until they get punched in the face.
I think there was some bargain hunting ongoing even before the rhetoric and trade action got into gear today. But it did look to me like there was another hit scheduled ahead of NFP data. Perhaps that is now off the table, and without looking at the market action in detail I would imagine a lot of that late session move in the metals today came from shorts getting the hell out of Dodge.
It was not that long ago when a major selloff staged around a big market event would take many days or even weeks for the PM sector to recover. Today we got all the way back in less than a trading session. And during the dog days of August no less!
Meanwhile, there is more than an hour left in trading as I write this, but the HUI looks like it could deliver an outside reversal day and that too is rarely tolerated after the heavy selling of yesterday. There are probably more reliable Bigfoot sightings than times I can recall seeing a direct rejection of a serious Cartel raid like we are getting right now. I did a bit of buying today before the curtain went up, as I fully expected the slam and was counting on a recovery shortly after.
How refreshing if the goddamn Cartel gets their thumbs slammed in the drawer for a change. And if indeed it is China that is the ‘whale’ buyer in the options trade, then how much of a perfectly timed response was the action in the metals today after another round of tariffs were announced?
Should be a very interesting Friday trading session.
cheers!
MM
From Mexico Mike on Murphs gold wrap today
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