$Gold Weekly

The gold sell-off this week does not necessarily invalidate the volatility smile that I sketched in a couple of months ago. If anything, it will give the short side of the equation a huge price premium. I'll stick with my analysis for the moment, but the long-term paradigm that has held true is a One Wave Extension in elliot wave analysis, where we have completed a recent '4' down wave.

The gold bugs immediately jumped on the price fixing scandal in these markets, but if currencies around the world are losing their purchasing power against commodities, then the gold price will continue to appreciate. It's preposterous to try to attempt to prove that the gold price is being driven down by manipulators when it's actually been up quite substantially over the price low.

I think it has more to do with the coming end of quarter at the end of the month, when the overwhelming short selling bias through equity swaps held against gold miners is bound to come to a close in November at the latest.

It's easy to make believe that selling your gold mining shares, taking a loss and buying bullion instead will make a better investment.

http://scharts.co/19tU8mf

$USB Monthly

The hooplah over tapering will thankfully come to a close over the next week. If they announce further Quantitative Easing, this will mean a small rally in bond markets, only to see the interim correction continue. Quantitative Easing means the central bank will take bonds off your hands at a discount.

I fully expect lower interest rates once this interim correction is over.

http://scharts.co/14IaQML

$IRX Weekly

The area in bond markets that should be watched, but is typically ignored are three-month treasury bill rates. In stockcharts.com, this rate is 0.10%. It's actually 0.01%.

A rout in the major indeces will push that rate below zero.

http://scharts.co/1gfAb4h

GBN.V Daily Ichimoku

The daily Ichimoku study continues to tally up the low volume selling occurring in GBN.V shares. If anything, an upside capitulation is in order, and this will probably come from outside any company activity.

A rally in DUST corresponds with the penny-pinching decline in GBN.V.

http://scharts.co/15uPn7k

-F6