Gigem77

No Renewed Bull Phase for Metals Miners Just Yet

Well, well, gold is over 835 and crude is over 121. Another swing and a miss, Bill.

The forward hedge book is smaller than it has been in a decade. ABX still has a sizeable hedge, but most have reduced or eliminated their hedges altogether. Companies like AUY hedge their base metal production and leave their gold fully unhedged.

No Renewed Bull Phase for Metals Miners Just Yet

The dollar index is 70% euros and yen. The rest are background noise. It's running into considerable resistance. It was not helped by the fact that FNM and FRE were shredded today. Crude is back to 116. Gold is 40 bucks off the low of last week.

No Renewed Bull Phase for Metals Miners Just Yet

The dollar rally is the result of a large short position unwinding. The sharp correction in some commodities is likewise a technical event. It is logically incorrect to extrapolate the short term unwinding of trades into a dollar "bull" market.

The dollar is attached firmly to the continued crap out in the financial sector. FNM and FRE are headed for government takeover and their shares will go to zero. Will LEH fail? WM? When the FDIC needs more money, what will the effect be on the dollar?