Throughout history, few investments have rivaled investing in gold for popularity as a hedge against many economic problems, from inflation, to economic upheaval or currency fluctuations, to war.

When you think about investing in gold, don’t restrict yourself to just buying physical gold, like coins or bullion. Alternatives to invest in gold include buying shares of gold mining companies or gold Exchange Trade Funds (ETFs). You can also invest in gold by trading options and futures contracts.

Physical Gold

Investing in physical gold can be challenging for investors more accustomed to trading stocks and bonds online. When it comes to physical gold, you’ll generally be interacting with dealers outside of traditional brokerages, and you’ll likely need to pay for storage and obtain insurance for your investment. The three main options to invest in physical gold are bullion, coins and jewelry.

Buying Gold Miner Stocks

Companies that specialize in mining and refining will also profit from a rising gold price. Investing in these types of companies can be an effective way to profit from gold, and can also carry lower risk than other investment methods.

Investing in Gold ETFs

Investing in gold ETFs  can provide you with exposure to gold’s long-term stability while offering more liquidity than physical gold and more diversification than individual gold stocks. There are a range of different types of gold funds. Some are passively managed index funds that track industry trends or the price of bullion using futures or options.

An investor can also invest  in ETFs that hold a basket of gold mining stocks. An example is the VanEck God Miners ETF (GDX.NYSE) which holds many of the major gold mining producers.  For investors wanting to be more aggressive and buy ore speculative mining companies, the VanEck Junior Gold Miner ETF (GDXJ.NYSE) is available.

Markets Rally, Bonds Break, Gold Soars—What You Need to Know

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Markets End Volatile Week with a Strong Rebound – April 11, 2025

Markets capped a wild week with a strong finish, shrugging off trade war shocks and riding a wave of optimism:

  • Stocks Bounce Back: After days of volatility, the Dow surged 600 points (+1.6%), the S&P 500 climbed 1.8%—its best week since October 2023—and the Nasdaq jumped 2.1%, led by a tech resurgence.
  • Trade War Tensions: Markets were rattled by China’s retaliatory tariffs of up to 125% and President Trump’s aggressive 145% hikes on Chinese imports. Yet, solid bank earnings and cooling inflation helped restore investor confidence.
  • Flight to Safety: Gold soared to a record high as a safe-haven play, while 10-year Treasury yields surged to 4.53%, approaching multi-decade highs.
  • Tech Leads Recovery: Mega-cap tech stocks including Nvidia, Microsoft, and Tesla staged a strong rebound after Thursday’s sharp selloff.

Despite intense geopolitical and market pressure, Wall Street closed the week with notable strength, showing surprising resilience.  ​The  S&P 500’s performance for the week ending, was its strongest since November 2023. Here is today’s heat map:

How 145% Tariffs on Chinese Imports Could Shock U.S. Consumers

With over 70% of key consumer goods like smartphones, furniture, and video games sourced from China, tariffs could trigger sharp price hikes across everyday essentials.

Bond Market Flashing Red: Why Yields Are Surging Despite Stock Market Weakness

There’s a notable shift in Trump’s focus this term compared to his first. Back then, he constantly cited the stock market as proof of a strong economy. This time, he’s barely mentioned it.

Instead, the emphasis is on policy—tax cuts, deregulation, spending restraint—and notably, lower borrowing costs. His Treasury Secretary, Scott Bessent, a former hedge fund manager, has made it clear: the goal is to bring down the 10-year Treasury yield.

But the market isn’t cooperating.

The 10-year yield, which dipped to 3.7% on April 4, has surged to nearly 4.5%—an 80 basis point jump in just one week. That’s the opposite of what Trump and Bessent want. Rising yields suggest the bond market expects higher inflation, even as economic growth slows—a recipe for stagflation.

Stagflation puts the Fed in a tough spot. Cutting rates could fuel inflation, but rising yields make borrowing more expensive for consumers, businesses, and the government.

So why are bonds selling off while stocks are falling? Isn’t the bond market supposed to be a safe haven?

The first part of the answer  answer lies in the scale of US borrowing. The government needs to issue $7–8 trillion in new debt this year to fund ongoing deficits and refinance maturing debt. With annual deficits exceeding $2 trillion and total debt above $37 trillion, supply is overwhelming demand.

Layer in the geopolitical angle: the US and China are in a full-blown trade war. China—America’s second-largest foreign bondholder—has leverage. If China were to start selling US Treasuries while the US is issuing trillions more, bond prices would plunge and yields would spike.

Plus, many US allies aren’t exactly eager to support bond auctions while facing tariffs of their own. Why help fund a government that’s targeting your economy?

If yields continue climbing toward 5% or higher, it could spell serious trouble for the US economy—and likely drag the stock market down with it.

Gold Surges to New Highs as Safe Haven Demand Soars

Gold is ripping higher—up $70 today to a fresh all-time high of $3,250.

Just last week, it dipped to $2,970 during a broad market panic that triggered liquidation across all assets—gold included. It was a classic case of the baby getting thrown out with the bathwater. But that selloff didn’t last. Investors quickly stepped back and asked: What are the real safe haven plays right now?

Treasuries? The yen? Neither offer the confidence they once did. Bitcoin has been trading more like a tech stock than a store of value. That leaves gold—and it’s showing why it still holds safe-haven status.

Notably, gold doesn’t look like a crowded trade. COT data last Friday showed net-long positions at year-over-year lows, a bullish contrarian signal.

Yes, gold is expensive relative to other assets:

  • The gold/oil ratio is at 53:1 (vs. a historical average of ~20:1).
  • The gold/silver ratio has ballooned to 103:1 (vs. a long-term norm around 50–60:1).

But these extreme ratios reflect deep global uncertainty. The West’s seizure of Russian reserves and removal from SWIFT showed that financial infrastructure can be weaponized. That sent a clear message to countries like China, Russia, and Iran: don’t trust the West—buy gold.

Add in today’s escalating trade wars and rising geopolitical risk, and it’s no surprise that central banks are aggressively adding to their gold reserves. Retail investors are following suit, looking for a hedge amid global turmoil.

Key levels to watch:

  • Resistance: $3,300
  • Initial support: $3,050
  • Major support: $2,960 (last week’s low)

For now, gold remains in a strong uptrend. It may pause or consolidate, but there’s little to support a bear case in the near term.

Stay tuned!

Markets Tumble as Tariff Shock Sparks Global Selloff

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Global stock markets suffered a steep crash today after President Donald Trump announced sweeping new tariffs, triggering one of the worst trading days in years.

Major Index Losses

  • Dow Jones Industrial Average plummeted 4%, shedding 1,680 points — its steepest single-day drop since 2020.
  • S&P 500 sank 4.8%, approaching correction territory.
  • Nasdaq Composite plunged 6%, officially entering correction territory with a 16.8% decline from its December peak.

Sector-Wide Selloff

  • Tech stocks led the rout:
    • Apple fell 9.3%
    • Amazon dropped 9.04%
    • Nvidia slid 7.78%
  • Retail stocks were hammered due to tariff exposure:
    • Restoration Hardware collapsed 40.1%
    • Nike fell 14.4%
    • Target declined 10.8%
  • Financials took a major hit as recession fears surged:
    • Bank of America dropped 11.1%
    • American Express fell 9.9%

Technical Analysis of S&P 500

The S&P 500 closed today at 5397, landing precisely on our previously identified support level (green horizontal line). The next 24 hours will be critical — if this level holds, we could see a short-term relief rally. However, the path of least resistance remains lower, with the next significant support zone down at 5245 (yellow horizontal line).

Markets absolutely hate uncertainty, and in this case, Trump’s tariff announcement has likely increased it, not reduced it. Some reasons why?

Mixed Signals

While the tariffs were announced with strong rhetoric, Trump also said he’s open to negotiation. That creates ambiguity. Are the tariffs a firm policy? A bargaining chip? A first move in a longer game? Investors don’t know — and uncertainty leads to risk-off behavior.

Potential for Escalation

Other nations might retaliate, which could trigger a full-blown trade war. The market is pricing in not just what has happened, but what could spiral out from it.

Timing Matters

Markets were already jittery — the Nasdaq had already been sliding — and this announcement poured gasoline on a smoldering fire. Investors are now grappling with the possibility of higher inflation, slower global trade, and a potential recession.

We do not have a crystal ball, nor does anyone else. That is why we rely on the charts and our models. We use technical analysis to tell us the most likely support and resistance levels and right now, we’re sitting at the first major test. If 5397 breaks down decisively, we’re looking to the next key support level at 5245 for signs of stabilization.

Gold surged to an all-time high earlier in the session, fueled by safe-haven demand in response to President Trump’s aggressive tariff announcement. But as the session wore on, many investors took profits, prompting a reversal in prices after the sharp rally.

Selling the Baby with the Bathwater

The broader market meltdown triggered margin calls and liquidity stress for leveraged investors. In such scenarios, gold — being one of the most liquid assets — is often sold to cover losses elsewhere. This forced selling contributed to gold’s intraday decline.

While gold usually benefits from economic and geopolitical uncertainty, today’s pullback appears to be more about short-term volatility than any fundamental shift in sentiment. We continue to view gold as structurally strong and expect it to remain resilient in the coming months.

Technical View

From a technical standpoint, we’re watching for gold to retest the upper boundary of its uptrend channel (red diagonal line) — a former resistance level that now serves as support. It’s likely gold will test this level multiple times, and if it eventually breaks below, we’ll be watching for the next key supports at $3,000 (green horizontal line) and then $2,950 (yellow horizontal line).

Oil prices tumbled sharply today, driven by a combination of demand concerns and unexpected supply increases — creating a ‘double whammy’ for energy markets.

  1. Recession Fears Fueled by Tariffs

Trump’s sweeping new tariffs have stoked fears of a global economic slowdown. A weaker global economy typically leads to reduced energy consumption, placing downward pressure on oil demand.

  1. Surprise OPEC+ Production Hike

OPEC+ added fuel to the selloff by announcing a larger-than-expected output increase of 411,000 barrels per day starting in May. The move caught markets off guard and raised concerns about a potential supply glut.

  1. Rising U.S. Crude Inventories

The Energy Information Administration reported a 6.2 million barrel rise in U.S. crude inventories last week — a sign of weaker domestic demand that further weighed on market sentiment.

Technical View for Oil

Oil closed the day at $66.95, sitting directly at its previously established strong support level (green horizontal line). This marks the seventh time oil has tested this support. With each additional test, the likelihood of this support level breaking increases, as repeated testing tends to weaken the strength of a support zone over time.

Navigate Market Volatility with Confidence

In times like these, uncertainty brings both risk and opportunity. That’s why making smart, informed decisions is more critical than ever.

There’s never been a better moment to subscribe. Our mission is clear: to equip you with trusted insights that help you invest with clarity and confidence—especially when it matters most.

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Market Recovery or Temporary Relief? Key Insights on S&P 500 & Gold

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The S&P 500 closed higher for the second consecutive day, marking a positive turn after four weeks of negative results. The index rose 0.6% to 5,675.12, showing signs of recovery after entering correction territory last week. However, Tesla and Nvidia bucked the trend, with Tesla down 5.36% to $236.55 and Nvidia down 1.98% to $119.27.

Key drivers included weaker-than-expected retail sales data, which raised expectations for potential Federal Reserve rate cuts later this year. Investors are also closely watching the Fed’s two-day meeting starting Tuesday, where rates are expected to remain unchanged.

Technical Analysis of the S&P 500:

The S&P 500 successfully pushed through and closed above its previous support level at 5670. This marks the first test of the current rally. The next challenge will be to surpass the early January low at 5775 (red horizontal line), which is expected to present stronger resistance.

These tests are crucial in determining whether this rally represents a ‘buy the dip’ recovery or a ‘sell the rip’ dead cat bounce. Previously, when the S&P 500 was trending within its upward channel, declines within the channel offered ‘buy the dip’ opportunities. However, with the index now below that channel, any bounce must demonstrate strength by breaking through key resistance levels to avoid the risk of further downside.

It’s important to note that losing support at 5,670 has left the S&P 500 vulnerable to potentially testing its next key support level just under 5,400.

Gold Update:

Gold has experienced an impressive surge over the past two and a half years, climbing 85% since November 2022. Currently, it is testing the upper boundary of its uptrend channel (white circle), which suggests that this resistance level is likely to hold. As a result, a pullback or consolidation appears probable. Such a correction would be a healthy development for gold, allowing it to build momentum and gather strength for its next potential move higher.

Navigate Market Volatility with Confidence

The current market environment presents both challenges and opportunities for investors. As we navigate through this period of uncertainty, it’s crucial to stay informed and make strategic decisions.

Now is the perfect time to subscribe and gain trusted guidance in these uncertain markets. Our mission is to help investors make well-informed decisions when it matters most.

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Trump’s Victory Fuels Market Frenzy: Today’s Charts

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The S&P 500 soars: The stock market skyrocketed with Trump’s victory and the Republicans securing the Senate and poised to claim the House.

Bitcoin soars to new high: Bitcoin surged past $75,000, driven by Trump’s pledge to establish the US as a leading crypto hub. This rally reflects heightened investor optimism around a potential crypto-friendly regulatory environment under the new administration.

US Dollar blasts higher: The dollar marked its strongest day since 2022 on a strong stock market and rising yields.

Bank stocks rally: Bank stocks soared as investors anticipated deregulation and economic growth under the new administration. Major institutions saw substantial gains, with JPMorgan Chase leading the way, up 13% today.

Gold falls: With a huge rally in the US dollar, gold got clobbered, down 73.00 for the day.

Bond market turmoil: While Trump’s policies are welcomed by the stock market, the bond market is reacting less favorably. Expectations of lower tax revenues and higher government spending point to rising deficits and ballooning debt. As inflation expectations climb, the value of fixed-income investments erodes, pushing investors to demand higher yields, which drives bond prices down. This dynamic reflects concerns over inflation and fiscal imbalances under the new administration.

Green stocks get hammered: Companies in the green energy sector saw sharp declines, with solar stocks such as Sunnova Energy plummeting—Sunnova dropped a staggering 51% today. This sell-off underscores investor concerns about reduced environmental policy support under Trump’s administration, casting uncertainty over the future of renewable energy initiatives.

Market insights: This political landscape gives Trump significant leeway to implement his pro-business agenda—lower taxes and reduced regulations—which investors see as fuel for market growth and economic expansion. The rally reflects Wall Street’s optimism about a policy environment favoring corporate earnings and business-friendly reforms.

 

 

This Week’s Key Market Highlights:

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October 25, 2024:

The S&P 500 dip:  The first weekly decline after six gains suggests a potential bounce next week, though election volatility could bring market jitters, especially if results are delayed.

US Election Countdown: With just 10 days until the election, markets leaning toward a Trump victory due to his pro-deregulation stance, seen as favorable for business.

Rising Bond Yields: Concerns about persistent inflation are pushing bond yields higher, limiting room for Fed rate cuts. The Bank of Canada cut rates by 50 bps to 3.75%, and the ECB by 25 bps to 3.4%, contrasting with the Fed’s 5%.

Rising Mortgage Rates: Contrary to expectations, mortgage rates are rising, tracking higher bond yields despite the Fed’s September rate cut.

US Dollar Surge: Up 4% since late September, the dollar’s strength reflects robust US economic data, solidifying it as the “least ugly” currency in uncertain times.

Canadian Dollar Weakness: As the Bank of Canada cuts more aggressively, the loonie falters amid Canada’s weaker economic outlook.

Homebuilder Setbacks: Rising mortgage rates weigh on homebuilder stocks.

Gold Near Highs: Gold is nearing new highs with its RSI around 70 (bottom of chart), signaling potential overbought conditions and a possible pullback.

Market Insights: Bullish trends continue, but election uncertainty looms. A clear election outcome may trigger a ‘sell the fact’ reaction.

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Why the Bond Market Fears Inflation Despite Fed Rate Cut?

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Why Retail Investors Should Pay Attention to the Bond Market

Many retail investors overlook the bond market, dismissing it as too complex or less exciting than stocks. However, bonds hold the key to understanding broader economic trends, especially interest rate movements. Ignoring them means missing out on critical insights that could enhance your investment decisions

The Unexpected Rise in Long-Term Rates

On September 18, 2024, the US Federal Reserve announced a significant 50-basis-point rate cut, the first since July 2023. Typically, rate cuts are designed to lower borrowing costs, leading to a drop in bond yields. However, this time, the opposite happened—interest rates on 10-year bonds went up, not down. So, why are these longer-term rates rising?

The impact was also felt in the real estate sector. The 30-year US mortgage rate jumped back to 6.69%, a surprise to many who expected lower mortgage rates following the Fed’s rate cut. This spike has left homeowners and real estate professionals rethinking their expectations.

Why Inflation Expectations Are Rising

To understand why bond yields and mortgage rates are rising, we need to look at the underlying factors driving these movements. One major reason is long-term inflation expectations. While the Fed may believe inflation is under control, the bond market seems to think otherwise. One of the key reasons why is related to soaring government deficits:

  1. Reckless Government Spending: The US government’s increasing debt levels mean more bonds are issued, leading to a flood of new supply.
  2. Replacing Maturing Bonds: New bonds must be issued to replace those that are maturing, adding more supply.
  3. Funding New Debt: Continued high levels of government spending require new bonds to finance the debt, driving yields higher as investors demand more to take on increased risk.

Since the debt ceiling was suspended on June 2, 2023, the US has added a whopping $4.3 trillion to its debt total, with national debt fast approaching $36 trillion. To put it into perspective, the $600 billion increase over the last two months is nearly three times the annual budget of NASA.

Navigating the Current Investment Landscape

Clearly, the bond market is sending a warning signal: inflation is not as controlled as we might like to believe, and expectations are that it will continue to rise. As inflation erodes the purchasing power of the dollar, many investors are turning to alternative assets like gold and Bitcoin.  Gold closed at a new all-time high today.

These assets offer a limited supply, making them less susceptible to devaluation. Unlike paper dollars, governments cannot print new gold or bitcoins out of thin air, which is why they remain popular as inflation hedges.

 Why You Should Stay Informed

Our team at the Trend Letter has been monitoring these developments closely. We’ve been publishing insights for over 22 years, helping our subscribers stay ahead of market shifts with timely alerts and data-driven analysis. Our models have consistently alerted us to key changes in the market, and our current portfolio is up 39% this year.

We provide our subscribers with weekly reports every Sunday evening, covering all major sectors, key events and trends to watch, including:

  • The effects on the markets of the upcoming US election
  • Central bank actions
  • Inflation trends
  • Potential recession risks
  • Seasonal market movements

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Stay tuned!

This Week’s Trends & Market Highlights

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October 18, 2024 Key Market Highlights This Week:

Gold reaches a new all-time high despite rising interest rates and a stronger U.S. dollar, driven by surging national debt.

The S&P 500 breaks through to a new record high, signaling strong market momentum.

Uranium stocks ratchet higher, fueled by increasing demand for energy, especially from AI data centers.

Semiconductors roaring  back, with Nvidia testing new all-time highs.

Market Insights: We’re witnessing a broad-based bull market across multiple sectors, even as bond yields rise and economic indicators fluctuate. Look out for a comprehensive update in this Sunday’s issue of the Trend Letter.

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This Week in Money Interview

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Martin did his monthly interview with Jim Goddard on the This Week in Money show. Topics discussed were:

  • Stock market trends
  • Gold coming into seasonal strength
  • Have geopolitical events been priced into oil?
  • Why has the $US been rising, especially given the Fed just made a deep rate cut?
  • The Fed says its not worried about inflation anymore, should they be?
  • There is a lot of mainstream media talk about a Soft vs Hard landing. What does it mean and how should investors prepare for either scenario?
  • The Fed cut rate 50-bps, and now the long bond yields are rising, which seems counterintuitive. Why is that happening?
  • The Shanghai stock exchange had wild swings in the past week, what is happening there?
The other guests on the show—Ross Clark, Victor Adair, and Josef Schachter also offer sharp perspectives on the current market landscape. Tune in!

Click here to listen.

No BUY Signal just yet

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As an investment newsletter, we strive to bring the best information to assist those who want to become better, more successful investors.

Bond yields:

Investing in bonds. The recent market turmoil is predominantly driven by concerns over long-term bonds and their elevated yields, as investors brace for the prospect of enduring high borrowing costs. The underlying issue for the long bond market stems from the ongoing accumulation of substantial deficits and debt by the US government, compounded by the fact that China and Japan, historically the largest purchasers of US bonds, are now sellers of them.

Currently, the US is making interest payments of $909 billion on its debt, as reported by the Federal Reserve. With the primary buyers of US debt transitioning into sellers, a pressing question emerges: who will step in to purchase this debt? As potential buyers remain on the sidelines, market dynamics are pushing yields higher in an attempt to attract new investors.

Remember, the Fed only controls the short-term rates, the market controls long-term rates.

Equities:

Investing in stocks. Although the recent selloff in equities showed some signs of slowing down on Wednesday, investors remain vigilant for any potential resurgence in volatility, particularly if the upcoming US non-farm payrolls data on Friday exceeds expectations. On Wednesday, the S&P 500 made a noteworthy rebound, surging by 34.30 points to reach 4,263.70, thanks to early buyers stepping in. However, as of this moment, it has started the day with a lower opening and has retraced much of those gains, currently down by 25.39 points.

Oil:

Investing in oil. In our previous Trend Letter last week, we anticipated a retracement in oil prices from their peak at 94.00, prompted by an elevated Relative Strength Index (RSI) reading of 78.00, with any reading above 70 indicating an extreme overbought condition. Subsequent to reaching that high, oil has experienced a decline of approximately 10.00, settling around our initial support marker at $86.00, concluding Wednesday’s session at 84.22. This morning, there has been a slight uptick, but at the time of this writing, the market remains relatively flat. Our next anticipated support level for oil stands at 79.70, and we expect it to test that level in the near future.

Gold:

Investing in gold. Gold continued its struggles Wednesday, down ~7.00 to 1834.80. Over the past few months our projected lower target for gold has been 1825. At the time of this writing gold is trading at 1828 and is exhibiting oversold conditions. We are on the verge of our models issuing a BUY Signal, but it hasn’t triggered it yet.

It’s essential to emphasize that we are trend traders, requiring more than just an oversold market condition. The market must exhibit a convincing rally potential. While we believe we are approaching that point, confirmation is still pending.

As soon as we receive that confirmation, we will promptly notify our subscribers. If you haven’t subscribed yet, our exclusive Special Offer, providing discounts ranging from 40% to 65% off regular prices, remains accessible until this Saturday. It’s your money, take control!

Stay tuned!

Market Notes – September 1/23

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Some investment news for those looking to invest in gold, invest in stocks, or currencies, and commodities.

Each week the Trend Letter, displays weekly heat map of the S&P 500. It is a great visual of the equity market that holds stocks many North Americans own. Each of the 500 stocks is shown in a box, & the size of the box represents its market valuation, and the colour of each box tells you how that stock did, GREENS being gains & REDS being losses.

As we can see, for the week, big tech stocks led the way higher. There was also a lot of green throughout most other  sectors, with utilities and healthcare being the main exceptions.

On the daily heatmap a bit of a different story, with some big tech in red.

Looking at the BIG picture, the S&P 500 is still solidly in a long-term uptrend channel, since 2009. If we were to test the initial support level  of that long-term uptrend channel, we would see a correction to the 4000 level, which would be a ~11% decline  from the current 4500 range

Based on seasonality, September is the weakest month for the S&P 500.

If we do get a decent correction in September, it could provide a good buying opportunity. Sectors that have looked good are oil, uranium, tech, gold, base materials and even cannibals cannabis, what with US health dept urging the DEA to relax restrictions. We will see if these will remain strong after Labour Day, or if the negative September seasonals take over.

What we do at Trend Letter is track those key support & resistance levels, looking for changes in trend, and then and alert subscribers when trends change.

In Martin’s interview with Jim Goddard on This Week in Money on Friday (interview start at 44:39), he promised to show the chart below. If we look at the last number of times the Fed CUT rates recently, so 2000, 2007 and 2020…each time was driven by the economy falling into a recession (grey shaded bars). And when they CUT rates (red arrows) the S&P 500 had sharp declines. In each of those CUTTING phases it was not until the Fed STOPPED cutting rates that the S&P 500 started to recover (green arrows).

For those investing in gold, the key numbers are::

  • Near-term resistance is 2000, 2040, then 2070, which was that double top in April-May
  • Next key support level is 1915, 1900, 1880, then & really strong support at 1825
  • If it does drop to 1825, that would likely trigger several new BUY alerts

In Martin’s interview with Jim Goddard, he explained why he still feels a recession is very possible. He outlined the two key leading indicators, the inverted yield curve and the Conference Board’s Leading Economic Index (LEI).  Both of these have an almost perfect record in forecasting recessions. Both are forecasting a recession coming soon.

A yield curve is inverted when short-term yields are higher than long-term yields. An inverted yield curve is a leading indicator of a recession and since 1955 (68 years), there has been only one time where the yield curve inverted without there being a recession.Recently, the yield curve is the most inverted it has been in over 40 years. Recessions don’t start when the yield curve inverts, but rather when it starts to ‘uninvert’ (red arrows).

This chart clearly shows that for each of the last 6 recessions, they all started after the yield started to rise. Today, the yield curve is starting to ’uninvert’ (circle).

The other indicator with a near perfect record of forecasting a recession is the Conference Board’s Leading Economic Index, which looks at 10 components across the US economy. That index, again in its latest report last week, is firmly saying a recession is coming.

 

Oil has had a great week after dropping down to the 80.00 level, it has rallied big time this week, and closed Friday at 85.55.  The big bump this week came after a massive 11.5 million barrel drawdown in US crude inventories. Also, we have the Saudi Arabia production falling and they, plus potentially Russia, are expected to extend the production cuts into the end of October.

Stay tuned!

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A weekly publication covering global bonds, currencies, equities, commodities, & precious metals. Publishes every Sunday evening, covers equites, currencies, precious metals, commodities, and bonds. Each weekly issue is about 50 pages, mostly charts, with key bullet points to make easy to understand. A 10-15 min read

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