The name of the game has been to fade convention, fade the major media and fade what you think normal should be, because my friends we are surely in some kind of Oz here. A new land of wonderment and magic where things are not the way they are 'supposed' to be.I have people in my personal life who have totally capitulated to the market and sold out and when asked my opinion, I have said the market is going to rally, and it could be a good one. But it will be a rally that will be just strong enough to get the media touting a different, more optimistic tune and to get an awful lot of capitulators to begin doubting themselves. Then, the rally born of disgusting policy will end. The big suck in, as it were.
I was out for most of the day and just returned to see that the goldies, in need of a breather, have taken the back seat to a reflating pig that is in full bullish regalia. I have some longs (commodities & China), but I am a trader. What is happening in the markets is probably the false economic dawn play, when policy makers may eventually be celebrated or at least not reviled quite so soundly. In my opinion, this should NOT be bought by 'buy and holders'. That is because policy makers' policy is destructive as it mainlines more of what killed the economy to begin with, right into its veins.
Anyway, gold pooped out but we expected that did we not? Gold underperforms positive correlation when optimism is rising. However, somebody forgot to give the memo to the HUI-Gold ratio, which has just ticked up yet again as a result of today's activity.
