Gold is back to market neutral

April 30, 2025

Currencies rally on Tuesday, but Gold gets sold

What do the Chinese have up their sleeves?

Good Day... And a Wonderful Wednesday to you! My beloved cardinals started their road trip losing... UGH They were rained out last night, and the team was probably grateful for the rain! I think I saw someone doing a rain dance outside their clubhouse! HAHA! Not really, but you get the point... I'm still trying to get why Gold is getting sold right now, but I think i've finally nailed it, so stay turned to the same bat channel this morning for that thought! Sam & Dave greet me this morning with their mega 60's hit: Soul Man

Well, the dollar is back to getting sold, after the PPT's intervention scared traders into buying dollars, but that wore off, and why wouldn't it? The U.S.'s first QTR GDP printed this morning at just .3% !!!! That sure gives the dollar bears some fodder for their buying... The BBDXY has lost 4 index points since we last talked. And starts today at 1,222... The fear of a bad Trade Deficit came to fruition yesterday, and that got the dollar selling. The strange thing about selling the dollar is that Gold isn't taking advantage of the weaker dollar... 

Gold was down $26 yesterday, and is down $13, rhe early trading this morning... On Monday, you may recall me talking about Gold turning around tts early morning loss, and that's exactly what it did.. Gold turned a $28 kiss into a Gain of $24... That's a $62 turn around folks... And got me thinking that the selling in Gold was over... Boy was I wrong! Gold has been sold two days in a row... Yesterday, Gold lost $26, is down $13. To trade at 3,303... Silver has been the whipping boy of the short metals traders for what seems like decades, and that's probably pretty close to what's going on... Silver starts today, down 25-cents...  

I mentioned above that I think I've nailed the reason Gold is getting sold so much lately...  You see it's all about the RSI... Remember when I had mentioned that Gold was in the overbought area of the RSI (Relative Strength Index) and was amazed that it was still gaining? Well, the short paper traders finally saw this overbought position, and decided to rectify that... And all their selling has just about brough Gold back to market neutral position. So, will they stop there? I doubt it... But all the weak data that's about to print should get the dollar bugs riled up again, and we could see a turnaround... The thing that I always say when the short metals traders have their way with the metals, as Silver too has been sold, is that what they do is create excellent buying opportunities... wink, wink.... 

The price of Oil has gotten sold, and is down $2 to trade this morning with a $59 handle... The slow growth of the U.S. economy has a lot to do with that... And the 10-year Treasury bond's yield is trading at 4.21% this morning... 

In the overnight markets, there was little to no movement in the dollar but that's about to change, in my humble opinion, because of the weaker economic data that's getting ready to be printed!  As I mentioned above, Gold is down $13 to start our day, and Silver is down 25-cents... These two need to get turned around quickly!  Copper has gotten mixed up with the short selling and has lost over 30-cents in value since Monday! Why? Because they can, that's why! 

Well, let's start this portion of the letter off with some talk about the younger generations work ethics... This bodes badly for the future of the U.S. economy, so let's get into right here: 73% of Gen Z and 70% of millennials are looking to change jobs, compared to only 33% of baby boomers, highlighting a significant generational divide in workplace satisfaction. Nearly 3 in 4 workers are living paycheck to paycheck

Burnout affects 68% of Gen Z workers but only 30% of boomers, with monotonous work and stagnant pay cited as top factors contributing to workplace exhaustion. Now isn't that special I say in my best Church lady voice... 

The key points are that 75% are living paycheck to paycheck, and that these young workers can't deal with monotonous work.... What, you mean, work procedures that you do every day? Did your mommy tell you too many times that you're special and that you will be President one day?  I could go on, but I won't... Not today, anyway... 

The advanced trade deficit printed yesterday, and this part of the data print is always much higher than the final number, but the print yesterday was blown out of proportion... The Advanced Trade deficit was a record high of $162 Billion... Just for the month of March, as importers rushed their orders ahead of the tariffs... And exporters also rushed their orders on the same basis... But, as we all know, we as a country import way more than we export... It will be interesting to look at the final number here... I'm just saying...

One currency I want to highlight this morning, is the Chinese renminbi... The Chinese have allowed the renminbi to strengthen VS the dollar.... The Chinese are very prudent about their currency moves, so they must be telling us something... I guess we'll know when it hits us like V-8 forehead slap! 

The U.S. Data Cupboard today already printed the 1st QTR GDP, and it wasn't pretty at just .3%, in case you read that number wrong... Its  0.3%, and in my opinion, that's a rounding error from going negative! The ADP Employment Report for April printed this morning already too... And it showed that only 62,000 jobs were added in the month... That's not very good total folks... And is trending the wrong way, as last month's print was a paltry 147,000... In just a bit of time, Consumer Income and Spending sill print for March... And the PCE will print for March...So, a very busy day for the economic data wonks... 

To recap... The dollar is getting sold, but Gold is too... And Chuck thinks he has figured out what's goinging on there... Copper has gotten mixed up in the short selling, UGH! The price of Oil has gotten sold too... While the 10-year Treasury has been getting bought... Chuck goes off the rails with the younger workers... And the Chinese renminbi has surprised currency traders with its strength... 

For What It's Worth... Well, since I made Big deal about the Advanced Trade Deficit, I thought I would let zerohedge.co elaborate on it a bit here... This article can be found here: Tariff-Frontrunning Sends US Trade Deficit To New Record High In March | ZeroHedge

Or, here's your snippet: "The U.S. merchandise-trade deficit unexpectedly widened in March to a record as companies continued importing goods to get ahead of tariffs.

The shortfall in goods trade grew 9.6% from a month earlier to $162 billion, Commerce Department data showed Tuesday.

Imports rose 5% to $342.7 billion, led by consumer goods, while exports increased 1.2% as firms scrambled to get ahead of President Trump's 'Liberation Day' tariffs...

Imports of consumer goods surged 27.5%, while inbound shipments of motor vehicles and capital goods also increased.

Because this is the 'advance' data release, there is no data for individual nation trade balances or how gold imports have shifted. Remember, gold imports had been soaring through February...and blowing up economists' models of GDP growth.

What we do know is that gold inventories at COMEX have been falling in March, suggesting a slowdown in imports... which will juice GDP forecasts (further confounding all the PhDs).

Finally, we note that Tuesday’s Commerce Department report also showed stockpiles at wholesalers increased 0.5%. Retail inventories fell 0.1% last month, reflecting a decline at car dealers."

Chuck Again... like I said above it will be interesting to see what the final trade deficit print will look like... I believe it will print near to a record deficit for a month... I'm just saying

Market Prices 4/30/2025: American Style: A$ .6374, kiwi .5908, C$ .7227, euro 1.1369, sterling 1.3352. Swiss $1.1818, European Style; rand 18.6101, krone 10.4052, SEK 9.6587, forint 355.43, zloty 3.7685, koruna 21.9192, RUB 81.28, yen 142.74, sing 1.3069, HKD 7.7664, INR 84.49, China 7.2714, peso 19.57, BRL 5.6287, BBDXY 1,222, Dollar index 99.47, Oil $59.62, 10-year 4.21%, Silver $32.74, Platinum $978.00. Palladium $958.00, Copper $4.55, and Gold... $3,303.18