Friday Recap (6/28/2024)

AU: $2324 ($2320 - Last Week Spot)
AG: $29.02 (29.54)
HUI: 267 (267)
DXY: 105.8 (105)
S&P: 5459 (5464)
10-Yr: 4.36% (4.2%)
Oil: $81 ($80)

Gold and the miners spun in place. Silver was down a bit, but held $29. It was a good month (and Qtr) close for both gold and silver. The miners continue to lag. The only stock you need to watch is Newmont, which is at $42. It needs to retrace to $82 to get back to its 2022 cycle high. Until Newmont gets to $50, the miners and the HUI are going nowhere. If you own more than 20 G/S miners like I do, then you can pull up the Newmont chart and know what your stocks are doing. Once Newmont crosses $50, the HUI will cross 300, and we will finally get our breakout. Until $50, we wait. 

As for gold (silver will follow), the thing to watch is the S&P 500. It traded at an ATH today at 5523, so it remains strong. Until we see the S&P below 5000, the risk-on trade will continue to dominate. Once the S&P is below 5000, the risk-off trade will begin to awaken. I'll get excited at sub 5000, and then really excited sub 4800. That's when the risk-off trade will show signs of life, and Newmont will get a bid. Newmont will be Wall Street's go-to gold miner because of the liquidity it offers and the relatively low risk for the gold sector. You could include Barrick and Agnico Eagle in that group, but Newmont is the big dog. 

As for the coming dip in stocks, I'm not worried about gold breaking down or the HUI to have a deep correction. Gold has been above $2300 since early March and is telling us a story. Gold and silver are breaking out and are not breaking down. Yes, the odds imply they will correct at some point this year, but not deeply. My target is $2000 to $2200 for gold, and it's possible we won't even retest $2200. I'm not worried about silver, because it will follow gold.

The last topic is the economy/recession. When does the recession arrive? My take is the stock market will be the trigger for the recession, and that something will trigger a sell-off in stocks soon. I'm expecting it in weeks or months. In fact, I think financial fear will exceed 2008 levels at some point in 2024. It hasn't started yet, but I expect it to arrive. Why? Because the Fed is trapped in a doom loop. They can't prevent a recession, and they won't be able to print their way out of one. When lower rates and liquidity injections don't help the stock market, investors will figure out the future.