MACR: Oil and Ether are the Ugly Ducklings of This Rally

Gold and Silver, Stocks and Bonds, are rocking this rally. October 01, 2024 [WEBSITE]( | [UNSUBSCRIBE]( Gold Glitters as Silver and the SPX Soar SEAN RING September 2024 Monthly Asset Class Report Kris Kristofferson, John Ashton, Dikembe Mutombo, and now Pete Rose. Dame Maggie Smith – ladies, first, I guess – went a few days ago. It’s been a rough few days for us 80s kids. But with Powell’s 50 basis point cut, and it’s looking like another one’s on the way, let’s let the good times roll while we’ve got some time left. Because Jay’s not only bringing the punch bowl. It looks like he’s bringing the keg, too. The SPX hit a new monthly all-time high, as did gold. Silver looks like it’s finally on the verge of breaking $33 for good. That leads us to the amber waves of $35 and $38. Bitcoin looks like it’s in the middle of a bull flag (I’ll explain later), while Ether looks like it’s got one foot in the grave and the other on a banana peel. But bonds continue to puzzle me. Maybe the market believes inflation is dead, the damn fools. Because bonds look good right now. But the big story is the dollar. As someone sitting in Europe, I cannot for the life of me figure out why you’d rather own euros than dollars. But right now, I owe Alan Knuckman dinner because he said the dollar index would fall below 100 before it rallied to 115. I thought he was crazy. He was correct. The dollar isn’t about to get stronger anytime soon. That’s excellent news for assets priced in dollars. Except for oil, for some reason. That chart is uglier than a drunk carpenter’s thumb. We’re heading down there, as well. Enormous American supply and a crappy world economy will do that to you. Without further ado, let’s get to the charts. S&P 500 ***New Monthly Closing High of 5,762.48*** Up, up, and away! We’re still hitting record after record in the SPX. This isn’t the time to sell. I thought it might be after Powell cut 50 bps instead of 25 bps, but that was incorrect. This market looks like it has a way to go. I still target 6,000. Nasdaq Composite We’re getting closer to establishing new all-time highs in the Nasdaq. After an abysmal first week of September, it rallied the rest of the month. Again, you don’t want to be a seller here. It’s giving no other indication other than going up. Russell 2000 (Small caps) The Russell didn’t do much this month, but that’s fine. It’s been holding up well. We’re still in a bullish trend, even if we look a bit toppy from time to time. The US 10-Year Yield We’re hanging around the 3.80% level. It’s surprising, as the dollar has fallen out of bed after Powell’s cuts. I expect this to come down further in the coming months, as assets get bid up. Dollar Index Now that the Fed is in a cutting cycle, you’d think the USD would’ve fallen more. It hasn’t cratered yet, but we’re in for a big dump soon. First, we’ll see 99.50, then 94.50. As a person who lives in Europe, this is utterly beyond me. But hey, no one said currencies were easy. USG Bonds We hit our 99 target from last month. The new target is 102.90. Honestly, I don’t like bonds with the inflation picture the way it is - no, we’re not out of this mess yet. But we must first listen to the charts. Investment Grade Bonds The next target is 132, though I doubt we’ll reach it. Still, there’s no reason to be short… yet. High Yield Bonds We broke the target of 79 this past month. Our new upside target is 85. Real Estate VNQ was up again this month. The target is still 116. [Urgent Publisher Warning]( Hi, I’m Matt Insley. I’m the Publisher at Paradigm Press. Today, I have [bad news to share]( regarding the future of Jim Rickards’ newsletter. [Click here now for my announcement.]( Energy: West Texas Intermediate (Oil) We fell another $5 this month. Forget a rally here. The next target is $61. Unless and until oil rallies, worries about a recession are unfounded. Base Metals: Copper The ascent wins! Dr. Copper is looking at a big rally now. We’ve already got up to $4.55. I’d look to clear $5.20 first. Then, the big target of $8.50 may be in play. Precious Metals: Gold ***HIGHEST MONTHLY CLOSE OF 2,659.40*** We hit the $2,609 target. We’re now looking at $2,759. With the Fed cutting rates before inflation has been tamed, we’re still nearer the beginning of a bull market than at an end. Precious Metals: Silver Ok, we’re close to the breakout we need. Once we breakthrough $33, which may take a while, the next stop is $38. From there, $50 will be much easier to hit. Cryptos: Bitcoin I don’t like the lower highs and lower lows on this chart, but this may be one big bull flag. From [Investopedia]( They are called bull flags because the pattern resembles a flag on a pole. The pole results from a vertical rise in a stock, and the flag results from a period of consolidation. The flag can be a horizontal rectangle but is often angled away from the prevailing trend, as in this example. I reiterate my target of $100,000 by January 2026, and I see the current consolidation pattern as a potential precursor to a breakout. The current bullish price target is about $90,000. Cryptos: Ether Ether has broken down. I’m unsure what the problem is, but ETH is considerably weaker than BTC. We could see ETH hit $1,950 from here. The charts are targeting a woeful $790. Trad Asset Class Summary Like the last two months, the big loser was the USD, down another 1.22%. Commodities and the SPX were up nicely at 4.45% and 4.22%, respectively. The long bond was, again, as flat as a pancake, moving up only 25 basis points. Crypto Class Summary Dogecoin, Ripple, and Bitcoin were up double digits in September. Ether and Litecoin were up single digits. Monero, the most secretive coin, was down 8.94%. Wrap Up SPX, Bitcoin, gold and silver… and even bonds… look amazing. Stay away from oil and Ether – you’ll catch your death there. Finally, let’s take a moment, courtesy of the Twitterverse: Have a wonderful day! All the best, Sean Ring Editor, Rude Awakening X (formerly Twitter): [@seaniechaos]( Rate this email Like Dislike Thanks for rating this content! Looks like something went wrong. Please try to rate again. In Case You Missed It… The South Is Rising Again! SEAN RING Growing up in the Northeast, I was taught The South was a desolate land inhabited by rednecks. Ron Paul, bless his cotton socks, was a lunatic, and The North was a pristine abolitionist land whose people freed the slaves. Luckily, I grew up and no longer believe those fairy tales. Since visiting places like Texas, Florida, and Georgia, my mind has been blown wide open. But just seeing how many northern transplants live in the South is enough to reiterate that you should never believe what you hear. Perhaps it's my reticular activating system doing its thing, but I’m seeing evidence of a resurging South all over the place. I’m thrilled for the people down there, as they’ve had a terrible wrap for a long time. But there’s no place this is more true than in University Land. Who Needs Harvard? Thomas Sowell once said, “In every disaster throughout American history, there always seems to be a man from Harvard in the middle of it.” Of course, a Harvard grad wouldn’t mind telling you there’s a reason they’re “in charge.” For my part, I’ve always joked that if my son Micah ever said, “Daddy, I want to be just like you and go to Villanova!” he’d get a closed fist to the face. I’d never do that, obviously, but I’d sure feel like a failure of a father. You may already know that I’ve been away teaching in Frankfurt for the past few weeks. I taught a class for a European asset management company with new hires from the U.S., Canada, the UK, Germany, Austria, Hungary, and Hong Kong. All the students graduated from top universities and were excellent in class. But what stood out to me was that no group stood out. For every bright Ivy League student, there was an equally intelligent kid from the University of Hong Kong or the University of Mannheim. If you pushed me to choose one, I’d say a few continental Europeans were ahead on the actual financial theory. But all brought something to the table, such as good Excel or near-professional presentation skills. This is only a sample size of one, but the difference between the Ivy League and Oxbridge schools and the rest of the world is shrinking… fast. As The Wall Street Journal highlighted, there may be a few reasons for this. The Silver Lining to the Tuition Crisis College is a complete ripoff. Hell, I thought Villanova was a ripoff when it only charged $22,000 annually in the early 90s. But college, especially up northeast, has become so idiotically expensive it isn’t worth it for everyone. I’d much rather send a kid of average intelligence to a trade school than a university. The economics prove this is an intelligent decision these days. Cheap tuition, no debt, and an immediate job put these young men and women ahead of the pack. Other than a great network and, more importantly, government-backed student loans, I couldn’t understand how universities were getting away with the tuition hikes. It seems they haven’t. The Wall Street Journal printed an article titled, “[Sorry, Harvard. Everyone Wants to Go to College in the South Now.]( (This title is clickbait, but so be it.) The comment section is hilarious. If you’ve got a WSJ subscription, read it for a good laugh and the outstanding rivalry between Northerners and Southerners. Of course, Harvard doesn’t have anything to worry about. It’ll always hit its admittedly small numbers. But what’s great is that Southern schools like Vanderbilt, Emory, Georgia Tech, Duke, and North Carolina are getting more attention from Northerners who might otherwise attend Ivy League schools. Schools like Alabama, Ole Miss, and Clemson are attracting those Northerners who wouldn’t be Ivy League-bound. The Journal writes: For out-of-state students, Southern schools are often a bargain, according to figures from roughly 100 of the nation’s top public research universities. Last school year, such Southern schools charged students from other states a median $29,000 in tuition and fees, the least of top public colleges in any region. And that’s just the beginning. [How To Profit From Starlink’s $180 Billion IPO Jackpot?]( Have you heard the big news? [Elon Musk’s company Starlink is preparing to announce their IPO in as little as a few weeks!]( According to Quartz, “Elon Musk’s Starlink IPO may lift off as soon as [2024.]” And for the first time ever, you have the rare chance to see how to profit BEFORE the IPO takes place. [Click here now for the time-sensitive details.]( [Click Here To Learn More]( Free Speech and Politics It seems some students aren’t into lockdowns and Israel-Palestine. From The Journal: At many Northern schools, by contrast, television news showed campuses beset by protests last year. This juxtaposition is one reason the flow of Northerners heading South could continue in the coming years, say college counselors. Students who have moved to the South for college pay less attention to politics than students who have moved to the Northeast, said Colby College sociology professor Neil Gross, citing a survey he took this summer. “Some students are saying, ‘I don’t want to be in a super political environment,’ and they are opting into an atmosphere where they can focus on things other than politics,” he said. It’s smart to learn at that age rather than throw oneself into political protests. But there are other factors, as well. Warmer Weather and More Growth Some prefer palm trees and shorts instead of wrapping up in parkas and puffy jackets. The warmer weather is definitely a draw for them. But more than that, the influx of students is terraforming an already strong Southern economy. It’s incredible to me that The South is already the largest U.S. region by GDP: It looks like there will be many more Northern transplants in the years to come. Wrap Up Between the insane tuition in Northern schools, free speech and political crises, and cold weather, many students prefer heading south to staying in the North. I can’t blame them. Give me the sun and sea with my books any day. Have a great week ahead! All the best, Sean Ring Editor, Rude Awakening Twitter: [@seaniechaos]( ☰ ⊗ [UPDATE PREFERENCES]( [Contact Us]( © 2024 Paradigm Press, LLC. 1001 Cathedral Street, Baltimore, MD 21201. By submitting your email address, you consent to Paradigm Press, LLC. delivering daily email issues and advertisements. 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