evening wrap, january 8
market vibes
January 8…)
Keep calm and carry on.
Palpable tensions surrounding fraud and immigration and a dead protester in Minnesota rivaled a bristling war of words between the Danes and Trump over Greenland today. However, some sunny economic data carried the trading day in New York.
Treasury Secretary Bessent said tax season will commence on January 26th and tax benefits in the Big Beautiful Bill will materialize immediately. Hefty rebates, stimmies in the mail. No cap gains in BTC! Atlanta Fed GDPNow forecast for Q4 2025 jumped to 5.4%. The trade deficit narrowed to $29 billion from $135 billion in March. This is hot stuff.
More good news for Main Street: Trump announced a plan to ban single-family home purchases by investors like Blackstone today. The tactic, if he does it, is not unlike the COMEX putting silver on “liquidation only” in January 1980. Blackstone would not be forced to sell. However, they wouldn’t be able to buy any more houses. BlackStone’s equity lost 17 billion.
In the markets
If we were to lay the daily ranges of silver end to end in the last 8 sessions it would tally $60 dollars. I would call this a 3 or 4 sigma event. Volume was lower in NY today, and open interest COB January 7 was unchanged. A dominant point of control (POC) is emerging (next chart) at $75.00.
From December 26 to present, the value area or range in which 70% (1st standard deviation) of all trading has occurred has a low of $73.00 to a high of $79.75. For now that range is in force with a slight upside bias but it’s looking like the rebalancing “auctions” are going to rotate around $75.00.
If prices develop at or below $73.00 as the rabalancing continues, that is good information. If prices cling to the highs especially as the rebalancing closes next Wednesday… even better information. In my opinion the bulls held their own today. We’ll see what happens tomorrow.
March settled down $2.47 at $75.14 precisely on the POC which is where it is as I write. I don’t expect any fireworks tonight in Asia or London tomorrow morning.
In other metals, gold, copper and PGMs settled at or near unchanged in a quiet day of watching silver. Technical development was equally subdued in all 3 metals.
Oil rallied contrary to dovish White House narratives. The WTI curve is snug ostensibly on a 3 mm bbl draw but RBOB had 7.7 mm bbl build so that’s wrong. My sniff … is leaks and we will be the last to know what they are.
In the stock market the S&P closed at the same price again for a 3rd session. The Dow had a mild rally on news Trump was asking for a 50% increase in defense spending to $1.5 trillion dollars. Rand Paul said there’s slim to none chance of that.
Apart from GS and the banks’ rally on Tuesday, stock indexes have been silent all week. A weak NFP tomorrow would reawaken the “AI is bad” narrative and be good for chances of a cut. Consensus is 60k … pretty small.
Early in the week I thought Bitcoin was poised for a rally and it might. But the longer it stays down here the higher the probability it will retest the isolated low and … the low won’t be isolated anymore. The other possibility is BlackRock and JPM are going to sell vol and suppress it ad infinitum. The best thing bitcoin has going for it is everything else is just as iffy, including gold and silver.
my vibe
On January 6, 2025 the S&P made a high of 6288 and fell 300 handles to 6000 on January 13. Narratives then were moody and mixed. Trump trades from November were sort of working but fading. The inauguration arrived. S&Ps rallied 400 handles and traded horizontally for a month. All the while unhappy optimism was very much like we are seeing now. On February 20 stocks started down in earnest. When Bessent was pressed to confirm a government “put” he said, agog to be asked… “There is no put.” S&Ps promptly fell 500 handles for 6 weeks. On April 2 Trump put the hammer down in the Rose Garden.
The markets appear to be very much the same this year. Gold and silver were crazy in January 2025. Stocks had been crawling higher by basis points every day, dead on the highs for months in January 2025. WTI crude oil posted the high of the year on January 13, 2025. Bitcoin made a high of $110,000 on January 21 and crashed with stocks to $74,000 on April 7. The dollar opened at the high of the year on Jan 6 and fell 10% and stayed there. So… crazy gold and silver, moody unhappy stocks, falling oil and crappy bitcoin. LA was burning in 2025. This year it’s Minneapolis.
It is still very very early in the year. We’re going to hear a lot of talk about seasonal trends and adages about January. None of them were any help once the year got underway in 2025. Bessent is not Yellen. Trump is so not Biden. The train was just leaving the station in 2025. The train is flying downhill full tilt, no brakes… into the unknown world of AI in 2026… and we’re never coming back.
Stay loose. Keep your powder dry. Last year was last year.
night all… good luck in asia…
JJ
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Would no cap gains on btc promote booking gains now vs the unknown 2027 calendar year?:
I don't know JJ...I keep having this feeling I don't own enough silver and gold.