On the heels of stocks being sold aggressively, today one of the greats in the business discusses the mid-$1,300s battle in gold, miners and the stock market plunge.
Just Sell ‘Em!
By Bill Fleckenstein President Of Fleckenstein Capital
April 24 (King World News) – The early going was a mixed bag, in that after successfully crushing the estimate in the game of beat-the-number, Google’s stock was splattered for 3%. When I saw how poorly it traded last night I thought it would give the market some real indigestion today, but that was not the case at first....
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Look What the CAT Dragged Down
Non-tech names responded pretty well to their news — e.g., Verizon and Caterpillar. However, 3M was smacked. Thus, it was really not possible to draw any strong conclusions initially. However, once CAT rolled over around midday, it was “game over” and the tape fell apart. Even though I was looking for the market to fall once all the “good earnings news” had been seen, I was somewhat surprised how quickly that happened (most likely due to the lopsidedness of the prior advance over the last several years, and the brittle structure I have discussed so often).
In any event, the market fell 1.5%, plus or minus, with the Nasdaq leading the charge lower. One day soon the 200-day moving averages will all be taken out for the big three indices, and then we are liable to see some real angst. Away from stocks, green paper was mixed, oil fell 1%, fixed income was heavier, with the 10-year touching 3% (as if a round number really mattered) before bouncing to close flattish, and the metals bounced, with silver gaining 0.75% to gold’s 0.5%.
Giving Them the Benefit of the (Past) Doubt
On a related note, the miners behaved pretty well again today, with Barrick seeing a nice bounce on basically in-line earnings. This is a change, because in the past group of quarters, even when miners reported very good news, they were punished, and Barrick’s report was in-line but not sensational, yet the stock popped for 3%. This is a positive development for the miners, which have ever-so-slowly and stealthily been acting better over the last couple of weeks. Hopefully, it is a sign that we are closer to a big move on the upside.
Included below is one question and answer from the Q&A’s with Bill Fleckenstein.
$1,350 Battle In Gold
Question: Do you (or mr skin) have any insight as to whether the resistance on gold in the 1350 area is made up of entities who are putting on shorts at that level or are they long holders who are using the price to close out positions?
Answer from Fleck: Impossible to know the answer. And even if you knew, it may not tell you much about “next time.”
ALSO RELEASED: With Stocks Plunging And Gold Rallying, This Has A Lot Of People Very Worried CLICK HERE TO READ.
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