One can devise all sorts of complex explanations why global stocks and US futures are on fire this morning, or one can just assume that alos are doing what they do best: fading Dennis Gartman.
From his latest note:
IF VOLUME IS SUPPOSED TO FOLLOW THE TREND…: If volume us supposed to follow the trend then the stock market is in very, very bad trouble indeed, for the volume is strong as the market weakens and its weak as the market weakens and its strong as the market rises.
We have changed our positions only by the very barest of margins here at TGL in our retirement account. Using our oldest trading rule which is to simply add to winning positions and try our very best to do less of those position that are serving us ill, we cut back on the long position we are holding in a small coal company headquartered in Illinois but otherwise we did nothing, leaving us a bit net shorter of the market.... We are sitting tighter, up 7.9% for the year-to-date and rather pleasantly out-performing global equities.
As for why gold is getting hammered today, perhaps it's as simple as this:
SPOT GOLD IN MONTHLY TERMS: An Important Trend Line’s Been Broken: It’s been four years + since the peak but now this trend line’s been broken and the bullish case for gold is becoming easier and easier to make and to hold firmly to.
We are long of gold in EUR and Yen related terms via GEUR and GYEN and we are long of gold in US dollar terms via the shares of the largest gold mining firm in North America against which we have written out-of-the-money calls, having rolled our deep-inthe-money-calls to a higher strike as the premium for the in-the-money-calls was evaporating.
As usual, the best signal to reset shorts will be when the virtual stops in the retirement portfolio are virtually hit.