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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (36380)	7/20/2005 11:46:50 AM
From: ild	Respond to of 110194

Date: Wed Jul 20 2005 10:59 trotsky (@PM stocks) ID#248269: Copyright © 2002 trotsky/Kitco Inc. All rights reserved in addition to the encouraging technical backdrop that has been detailed by AU_NB and WilE on several occasions, i'm happy to report that money flows in the pm sector continue to look exceptionally strong, which is a bit surprising, but an unalloyed positive. meanwhile the sentiment backdrop in terms of positioning data remains in 'neutral' territory by and large, although put/call volume ratios in e.g. XAU options continue to reveal growing skepticism. even yesterday, with the index closing up by 0.40 and thereby outperforming the PoG, the volume ratio came in at 2, i.e. twice as many puts as calls were traded ( after a ratio of 5.95 the day before ) . the sentiment backdrop is neutral because both p/c OI ratios sector-wide and the Rydex timer inflows into the sector are sort of middle-of-the-range compared to the readings of the past year. however, the CEF premium has shrunk to zero basically ( it's oscillating in a tight range around the zero line ) , so there's no excessive enthusiasm detectable there. anyway, all of this has to be brought into context. the context is a rising XAU/Gold ratio, and the sector sentiment RELATIVE to broad market sentiment. with broad market sentiment firmly in giddy bullish unanimity territory, gold sector sentiment looks very skeptical by comparison. this opens up the intriguing possibility of rotation - i.e., money leaving the broader market, especially the sectors that look very stretched by now like e.g. oil and housing may be partially rotated into the gold sector.