A huge disappointment!

The Nobel Prize in Chemistry was just awarded to two scientists for research on CRISPR genetic editing technology. Emmanuelle Charpentier of the Max Planck Unit for the Science of Pathogens and Jennifer Doudna of the University of California Berkeley were named for their work with CRISPR as applied to prokaryotes (bacteria and archaea). If you don't now yet, CRISPR is a method of using a guide RNA and a specific enzyme to "edit" a genome with targeted precise locations in the DNA. While there is still a long way to go to see the clinical use of it, in theory CRISPR can be used to cut out, insert, or replace sections of DNA to correct mutations that cause disease. No need to say, this is one of the most revolutionary technologies in human history!🌹 

While these two brilliant scientists as the very first ones to pilot this revolutionary invention are by all means qualified for this reward and honor, it is a huge disappointment that the Nobel Prize committee did not even mention another important contributor to CRISPR, Dr. Feng Zhang.  While Charpentier and Doudna were focused on CRISPR as applied to bacteria, Zhang's research was focused on using CRISPR as applied to eukaryotes – plants, animals, and humans. As a matter of fact,  nearly all of the research and work in the biotech field on CRISPR is focused on applying the technology to eukaryotes, which is based on Zhang's work. Although not in the context of the Nobel Prize, Zhang will be referred to and named again and again as the practical applications of this wonderful technology become widened and more progressed.  These are advances like the end of genetically caused human disease, crops that are naturally pest- and drought-resistant, and the ability to "grow" organs in animals to then transplant to humans… just to name a few.

In terms of clinical use, we are still at the early stage, largely in phase I studies. So there will be at least a few years before we may see any real use of it in treating human diseases. As with any new technologies, it will not be an easy smooth way in progressing it to real life application. We may see some setbacks along the way but I'm confident it will eventually be successful. 

There are a few CRISPR companies already publicly listed. Two major ones are EDIT and CRSP. As you can see below, both have been largely going sideways since IPO in 2016, likely reflecting the fact that their products are still at the early stage of testing with high risks involved. I'm personally convinced for the efficacy of the technology in treating genetic diseases but the huge unknown or uncertainty is its safety. For example, will the genetic editing cause unwanted alterations of some organ functions? Or will it cause cancers down the road after the gene being manipulated? There is no clear answer to such questions and we just need to wait and see. So be mindful of the potential wide swings of the stocks due to unexpected news from the ongoing studies.  

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By the way, if you are interested in joining my DW investment group, we have set up a Telegram group. 

Here is the link for "DW  谈股论金": https://t.me/joinchat/SgYa_xNrjTNHk9cS51ke0A.    

Importantly, you cannot join directly via Wechat. Two options:

1. When open the blog in Wechat,  点击右上角的三点，然后选在Safari 中open，然后点击the link and then join 
2. Or copy the link and paste to Safari to open and then join 

Conflicting indicators in the market

It is the same drama playing out again and again. Recently in the past few weeks, the drama is called Rangebound. Basically, S&P was fluctuating roughly between  3300 and 3400 with a few points below or above depending on its mood. Right now, the market wants to expand this band and it is at its upper end of that range around 3480ish. In the next week or two, I think it will march back toward 3300ish to repeat this drama again. Basically the market is directionless for now and this may likely continue till and through the elevation day on Nov 3. As I said before, I highly doubt we will see the election result on Nov 3 but rather it may drag on for weeks, if not months. This will create a huge uncertainty to crash the market if this indeed materializes! Be prepared for this scenario that is becoming more and more likely based on what I'm seeing. 😵 By the way, the fear index VIX is sending a big warning sign for the next 3 weeks. As I said before, the VIX call/put ratio tells us a lot about what it is heading. For next week, the VIX call is priced in 8 times more than its put, 12 times more in the week after and then 15 times more in the last week of Oct. If you love to chase the market, be aware of this as this indicator is pretty accurate in its prediction. As we all know, a high VIX is usually associated with a lower market. We have seen times and times again that VIX can jump 50% with a blink of eyes. 🤕

For those friends who would like to learn more about the technical details about the current market status, see the analysis below that I think provides some quite good insights. Don't be confused about the conflicting information in the market, which is actually quite normal and often seen in general. Hardly you will see crystal clear and straightforward information telling you what the market is going to do next. Not at all! As I said many times before, the market has the habit to confuse as many people as possible and then punish most people the most!!    😎

Conflicting Information by Lance Roberts 

If we break down the commentary and charts into critical points, we can gain some clarity.

1. The market broke above resistance (bullish)
2. MACD has crossed positively, issuing a "buy signal." (bullish)
3. The market broke above the 50-dma. (bullish)
4. The overall trend from the September highs is negative (bearish)
5. MACD is back to overbought (neutral to bearish)
6. Intermediate-term "sell-signals" still firm (bearish)

Notably, while the recent correction did reduce our fear-greed index somewhat, it remains elevated. Again, like volatility, overall investment positioning doesn't show "fear" of a deeper correction. While the indicator is currently in more "neutral" territory, it suggests gains are likely limited short-term.

The same goes for positioning by professional investors. With positioning back to more neutral territory, any rally in the market is likely limited.

The current psychological conditions suggest the short-term bottom in the market remains intact. However, given that much of the more "bullish" exuberance was not displaced, the upside may get confined to previous highs.

As noted, much of the impetus for the rally was "hope" of more stimulus. However, currently, there is little evidence of another CARES Act occurring before the election, particularly with the Senate in recess. Such could wind up disappointing investors in the short-term, particularly as economic growth continues to wane.

Technical Concerns

From a purely technical perspective, the market remains in a long-term deviation from historical trends. The problem with long-term trend analysis, much like valuations, is that markets can "remain irrational longer than logic would predict." It is during these periods of "irrationality" where investors begin to believe "this time is different," or "such and such" doesn't matter any longer due to Central Bank interventions.

Those beliefs have, without exception, wound up costing investors more than they ever thought possible.

As noted above, on a short-term basis, if the market can clear the 50-dma, a subsequent rally back to all-time highs is certainly not out of the question.

However, when viewing longer-term time frames, the risks become more evident. As shown in the "weekly" chart below, the deviation from long-term means remains at extreme levels. Historically, these deviations correct themselves. Such a "mean-reverting" event can occur over a drawn-out period, as seen in 2015-2016. Or, it occurs rapidly, as seen in both 2018 and 2020.

What is essential to understand is that while the short-term bullish "meme" is hard to resist, these "mean-reverting" events occur regularly. They also tend to happen when the media least expects them too.

If we take a long-term view, the "monthly" chart confirms the same. Relative-strength continues to diverge negatively, participation remains weak, and markets remain well deviated from long-term means.

The Rules

Instead, we will use rallies to:

• Re-evaluate overall portfolio exposures. Are equity exposures aligned with current market dynamics and related risks?
• Raise cash as needed. (Cash is a risk-free portfolio hedge when clear opportunities are not available.)
• Review all positions (Sell losers/trim winners)
• Look for opportunities in other markets and assets. (There is no rule you can only buy stocks. Bonds, commodities, currencies, alternative investments, annuities, etc. can all have places.)
• Add hedges to portfolios. 
• Trade opportunistically. (There are always rotations which can be taken advantage of)
• Drastically tighten up stop losses. (Tighter stop-losses reduce unexpected downside exposures.)

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By the way, if you are interested in joining my DW investment group, we have set up a Telegram group. 

Here is the link for "DW  谈股论金": https://t.me/joinchat/SgYa_xNrjTNHk9cS51ke0A.    

Importantly, you cannot join directly via Wechat. Two options:

1. When open the blog in Wechat,  点击右上角的三点，然后选在Safari 中open，然后点击the link and then join 
2. Or copy the link and paste to Safari to open and then join 

Untold truth about political polls

The Unvarnished Truth About Political Polls

 

One of my goals with Money & Crisis is to help you learn to think differently about the world.

Yes, the primary focus is investing and the markets. But to make REAL money in the markets, you need to think differently from others. After all, what are the odds of you seeing extraordinary returns if you think the same thing as everyone else?

With that in mind, I want to take a moment today to discuss things like polls and surveys.

 Organizations use polls and surveys to guide and justify their decision-making processes. In the field of politics in particular, polls and surveys are supposed to represent profound insights into what Americans feel or think about a given candidate or policy.

Like most people, I used to take these things seriously. Until I did an in-depth analysis of the methodologies used by political pollsters to get their results.

What I discovered was truly shocking.

The Truth About Polls

I can say as a point of fact, that over 95% of polls are propaganda used to shape opinion — NOT accurate depictions of how people actually think and feel.

A few facts:

• The response rate for most polls is 9%, meaning fewer than 1 in 10 people surveyed actually answer.

• The samples used for the polls are rarely an accurate depiction of American demographics. Most of the time, the polls oversample Democrats or left-leaning individuals by a scale of 4% to 9%.

• These polls use leading questions that are framed with a particular goal in mind, NOT to get a legitimate answer.

All of the above statements are facts, NOT conspiracy theories.

Regarding point #2, roughly 29% of the country identify as Republican. Another 29% identify as Democrat. And 40% identify as independent. Any poll that doesn't utilize that breakdown, doesn't accurately represent America.

With that in mind, let's take a look at a recent CNN poll that suggested Joe Biden annihilated President Trump in the first debate and expanded his lead as the favorite to win election in November.

The very first paragraph in the methodology section of this poll states.

A total of 1,205 adults were interviewed by telephone nationwide by live interviewers calling both landline and cell phones. Interviews were conducted in English and Spanish. Among the entire sample, 33% described themselves as Democrats, 28% described themselves as Republicans, and 39% described themselves as independents or members of another party

So already, this poll is skewed by 4% towards the Democrats. Throw in the fact that we live in an era in which being openly pro-Trump can result in getting fired, assaulted or worse, and what are the odds this poll is even remotely accurate?

Put another way, what are the odds that the average American will answer his or her phone and say to a total stranger, "why yes total stranger who I've never even met and who is affiliated with an organization that hates the President, I am going to vote for Trump!"

You get my point.

How Should We Think About Political Probabilities?

If polls and surveys are not useful for predicting anything, what is?

The actions of politicians.

Consider Joe Biden. For the last six months he's been largely holed up in his basement giving interviews and speeches. Since May, Biden was almost exclusively in his basement, NOT on the campaign trail.

I ask you, if Joe Biden did so well in the first debate, why is he suddenly out on the campaign trail visiting states that were previously thought to be guaranteed winners?

Within 24 hours of the debate ending, the Biden campaign announced he would be on a "train tour" to visit Ohio and Pennsylvania. He followed that up with trips to Michigan and Florida.

If Biden had indeed done well in the first debate, and was leading Trump by a wide margin, he wouldn't be doing this. He'd continue staying in his basement.

From this alone, we can deduce that internal polling — as in the polls that politicians use to gauge public sentiment and which are NEVER released to the public — indicate that Biden did poorly in the debate and that he is in fact trailing President Trump in states like Ohio, Florida, Michigan and Pennsylvania.

When it comes to politics, you don't need to listen to the talking heads or heed the polls. Focus on what politicians are doing and you'll be a whole lot more accurate.

No secrecy anymore

The President's Mass Declassification
By Sebastian Gorka, PhD

After I left the White House in 2017, I wrote a book of my experiences and the way Donald Trump, a non-politician, had totally upended American politics. Once The War for America's Soul was written, I decided to do one more thing... I contacted the president to ask if he would agree to an exclusive interview on his tenure to date and lessons learned. He agreed, and the transcript of our discussion in the Oval Office became the appendix to my book. 

After advising him on national security issues as a candidate, and then serving as his strategist in the White House, the Boss was rarely able to surprise me... But his response to my last question caught me totally unawares.

I asked the president what he would say now – in hindsight – to the man who had taken the momentous decision to run for president back in 2015? He responded, "Nothing." But then he paused, reflected for a moment, clearly changed his mind, and then said, "I would have advised myself to never ever appoint Senator Jeff Sessions as Attorney General. That was the biggest mistake I ever made!" 

With the historic tweet the president sent out Tuesday night, he may be finally undoing all the damage caused by his original and regrettable decision to bring Sessions into his cabinet.

If this is in fact the case, and all the relevant documents will be released, we may finally learn the truth... The complete lack of action taken by Sessions in investigating the Obama Administration's Operation Crossfire Hurricane, after he recused himself from all matters "Russian," and the never-ending investigation into the so-called "Russia Hoax" by U.S. Attorney John Durham, will be short-circuited and we may finally know what happened with the 2016 election.

With his decision to hand over the day-to-day running of the Department of Justice ("DOJ") to a career bureaucrat like Rod Rosenstein – implicating himself in the Obama DOJ and FBI's targeted surveillance of the Trump Campaign and Trump White House – Sessions ensured the true origins of the Steele Dossier... And the move to entrap incoming National Security Adviser, Lt. Gen. Michael Flynn, would never be uncovered while he was attorney general.

When Sessions was fired and replaced with former Bush's Attorney General William Barr, those who had hoped to know the truth were buoyed, especially when Barr brought Connecticut U.S. Attorney Durham in to investigate the genesis of the first-ever clandestine multiagency counterintelligence operation against a presidential campaign. Despite those high expectations, justice has not been forthcoming... 

Instead, thanks to one solitary plea deal and the incredible work of General Flynn's attorney, Sidney Powell, who forced them to release documents that should have been made public years ago, we have learned the following... 

• There was no criminal predicate for the investigation of General Flynn.
• Both President Obama and Vice President Biden were fully aware of the operation that surveilled the Trump campaign and Trump White House.
• The secret Foreign Intelligence Surveillance Act ("FISA") warrants used to spy on the campaign were illegal.
• The Steele Dossier used to justify the FISA warrants was based on disinformation from a Ukrainian source employed at a Washington think-tank, who had been previously identified by the FBI as a suspected Russia Intelligence operative.
• The FBI illegally changed CIA documents in order to justify spying on former Trump adviser Carter Page.
• The investigation of General Flynn was meant to be closed down for want of any crime before the inauguration of President Trump. It was kept open at the express orders of Peter Strzok, the since-disgraced former Deputy Assistant Director of the FBI.

We are less than one month away from the election... President Trump, who controls the classification and declassification system of the U.S. Intelligence Community, may have just made his most important decision, and ensured that the American voters will finally know what was done to him and his team, and the will of those who elected a non-politician to the highest office in the land.

The Death of the GOP

The Death of the GOP
Democrats only needs full control for two years to change the system forever. And they know it.
By Buck Sexton

The year 2020 has shattered all political predictions.

Going into January, President Donald Trump was presiding over a booming economy. He had the entirety of the Republican Party united behind him and the political winds at his back – despite an impeachment trial that went nowhere.

He was heading into the final year of his first term with a roaring stock market, record-low unemployment, and no new major wars or military escalations abroad. He wasn't tired of winning, but the thought was sounding less outlandish.

Then the COVID-19 pandemic hit. The economy began a tailspin in March. The world spent weeks – then months – on unprecedented lockdowns. And in May, George Floyd's death sparked a series of protests and riots that would rock the country through the summer, causing tremendous damage and exacerbating flight from urban areas.

There is no conventional election wisdom about who will win this November between President Trump and Democrat candidate Joe Biden. The polls show a close race in the battleground states, but all the aphorisms about "a week is an eternity in politics" apply. The range of realistic outcomes is everything from a narrow win to an electoral wipeout for either side.

But while it isn't the most likely scenario for the election, there is one result that will have the greatest and most drastic long-term impact...

What would happen if Joe Biden and the Democrats win full control of the government? That is, a Democrat in the White House with a consolidated Democrat majority in both houses of Congress.

So in CIA parlance, it's worth doing "red cell" analysis to work through what could happen if this event takes place. This is not an assessment of what will happen or how likely it is. Instead, it's about what could happen, given the right opportunities.

Our assumption for this plan is that Biden only has a complete Democrat majority until the midterms. That leaves him and his team two uninterrupted years to enact their will on the American people.

Could he dramatically transform America, turning this country into a de facto one-party state, given two years of scorched-earth politics? Here's a theoretical timeline of events to show what the answers to those questions may be...

January 20, 2021
Inauguration Day Speech, President Biden

After a tight election that came down to narrow victories in Florida, Michigan, Pennsylvania, and Ohio, newly sworn-in President Joe Biden tells the nation that the hour of healing is upon them. His speech is filled with boilerplate Democrat slogans, with a clear focus on "unifying the country." He takes shots at his predecessor, promising that he won't "govern by tweet." Biden tells America that dignity and decency have returned to the White House.

However, Biden does noticeably stumble a few times during the speech, occasionally seeming a little confused while staring into the prompter. The national media declare that a new era of responsible government has arrived, and ignore the potential cognitive decline of the new commander in chief.

Some analysts are wise enough to see through this fraud... While Biden is assuring the nation that he represents a return to normal – after all, who believes "blue collar Joe" is a radical? – the Democrat Party apparatus has spent weeks fine-tuning legislation that socialists like Bernie Sanders love. The most extreme left-wing activist groups want to make the country pay for all its sins of the Trump era... and they will.

There is also talk inside Washington, D.C. circles of the bold new agenda coming from this "third term of the Obama administration" – as they are branding the elevation of Obama's former VP.

Biden continues to show his toothy grin to the media cameras, occasionally looking lost, but always aware of his ultimate purpose.

February 22, 2021
President Biden's First State of the Union Address

The gloves come off. Biden gives a speech beginning with the usual bromides about helping working-class families and celebrating the diversity of our nation.

Then he turns his fire on Republicans... He claims they're unwilling to be reasonable on critical legislation that will address climate change, undocumented workers, income inequality, gun violence, and health care. They're in the pocket of special interests, he says, and refuse to budge on issues of economic, environmental, and racial justice.

Biden announces that while he wants to work with Congress, he has an obligation to bypass the Republican minority in the House and Senate because of their "obstructionist" ways. Biden tells America he will issue a series of executive orders on major policy areas because as a result of the need to recover from the COVID-19 pandemic, the American people "simply cannot wait any longer."

Meanwhile, Senate Majority Leader Chuck Schumer and Speaker of the House Nancy Pelosi coordinate a series of legislative actions to unleash the moment that Schumer eliminates the filibuster – announced one week after Biden's State of the Union.

June 8, 2021
President Biden Speech to the United Nations Climate Change Summit

With the elimination of the filibuster, Democrats begin ramming through every bill their base has ever wanted... but for which they could never get a single Republican vote. Their latest was the passage of the Biden Public Option health care program – the first huge step toward "Medicare for All."

The Government Accountability Office warns the cost will be ruinously expensive for the government as private plans disappear. The Democrat-aligned media are overjoyed, confident that they will still be able to see private practitioners, even if the rest of the country's health care starts to look more like Cuba's.

Biden gives a "historic" speech at the United Nations during which he announces the return of the U.S. to the Paris Climate Accord. In order to re-establish global leadership on the "existential" issue of climate change, President Biden Announces that the U.S. will begin enacting the Green New Deal.

The stock market plunges in response to Biden's speech. Coal power plants shutter due to the newly announced onerous regulations. The price of gas skyrockets, as do heating and cooling costs for hundreds of millions of Americans.

Congresswoman Alexandria Ocasio-Cortez goes on MSNBC to proclaim a new era of "environmental justice" in America... She promises that the Green New Deal will take trillions of dollars of wealth from corporations and give it to working people, primarily "communities of color."

President Biden also announces the creation of a new Cabinet position, "Secretary of Climate," who is responsible for overseeing the Environmental Protection Agency as well as the newly created "Department of Climate." A carbon tax is instituted to drive up the price of all economic activities not reliant on renewable energy. The unemployment rate jumps, thanks to immediate layoffs and imminent bankruptcies in the energy sector.

Republicans complain about the Constitution, the separation of powers, and the wonders of the free market. Democrat activists laugh at them on social media and chase them out of restaurants.

August 9, 2021
Senate Majority Leader Chuck Schumer Announces Passage of Comprehensive Immigration Reform Bill

Still riding high off their "bold new action" on climate change, the Democrats make their next major move on immigration.

Record numbers of illegal aliens have crossed into the country at the southern border in response to the promise of "free health care" through the Biden Public Option. Senate Majority Leader Chuck Schumer declares that the Senate – by a narrow 52-to-48 vote – has passed a "pathway to legal status" bill for illegal aliens in the country.

Officially, there are a number of benchmarks and legal hurdles for the millions of illegals covered under the "Biden Bridge to America" policy. Democrats shout down Republican criticism of the action as an "amnesty" – claiming that back taxes will be paid, English proficiency proven, and criminal background checks run on every applicant.

None of the Democrat apparatus believes any of that will happen... and the Biden executive branch has no plans to enforce it. President Biden orders his Department of Homeland Security to print federal identification cards and work IDs for every "undocumented' immigrant in the country. "Now everyone is documented," Biden tells the media during a pool spray outside the West Wing.

Pelosi and Schumer confer about legislation to go from "pathway to legal status" to "citizenship," with the working title "The American Dreamer Act."

December 7, 2021
Biden's Address to the Nation From the Roosevelt Room

With his first year in office almost finished, President Biden stands in front of the American people...

In bittersweet tones, he announces that he is stepping down from the office of the presidency for unspecified health reasons. Rumors fly that his early-onset dementia was growing worse, and his staff and friendly press corps were no longer going to be able to cover for him.

Teary-eyed Biden proclaims his endless love for the American people, then announces that the country is in "the best possible hands" with Kamala Harris. President Harris becomes the first black female president of the United States.

He then rides off into the sunset with every liberal media outlet and the entire Democrat establishment grateful to him... After all, not only did he save the country from four more years of Trump, he also handed over the presidency to a minority female.

Biden goes on the speech circuit for $250,000 an hour, and receives a $10 million advance for a ghostwritten memoir. His son, Hunter Biden, gets a cover story in Vanity Fair: "The Next Great Biden Comeback?"

January 24, 2022
President Kamala Harris' First State of the Union Address

President Harris makes no apologies for what she claims is her new radical agenda...

In her first speech as president to the American public, she tells the Republican Party that there can be no negotiating when it comes to issues of "justice" – and every major Democrat agenda item is exactly that.

She tells America that the growth of the Public Option is so popular, it will be expanded into a full-scale "Medicare for All" plan. Harris says the Green New Deal will require a trillion dollars of investment in new technologies and jobs over the next two years of her presidency. She warns fossil-fuel makers that they will no longer be able to "profit off poisoning our air" and establishes a presidential Task Force on global climate reparations.

President Harris also announces that through an act of Congress (only possible due to the elimination of the filibuster) all former illegal aliens naturalized through the "Biden Bridge" program will soon become citizens able to vote if they meet certain criteria.

Once again the benchmarks are ignored, but citizenship is conferred. Millions of predominantly Hispanic voters are registered through a special program set up by the Harris White House.

May 2, 2022
President Harris' Executive Order on Gun Violence

Using the precedent of COVID-19 lockdowns, President Harris announces from the Oval Office that gun violence is a "national health emergency" that requires immediate federal action. She declares via executive order a national assault-rifle ban, subject to a 90-day handover period, and a mandatory national handgun-registration program.

Congressional Democrats then move with accompanying legislation, adding criminal penalties under statute for non-compliance. They don't get a single Republican vote, but they don't need one. President Harris touts the creation of a national firearms registry as one of her greatest accomplishments.

November 8, 2022
Midterm Elections

Democrats win their biggest majorities in the House of Representatives and the Senate since 1936 when the Republicans only had 16 seats. Texas flips to a blue state for the first time in decades, and Ohio and Florida become solid Democrat strongholds.

Pollsters point to the obvious – despite a contracting economy, unsustainable debt, and massive health care shortages – the new infusion of millions of Hispanic voters delivered what will be an unbreakable and likely generations-long majority to the Democrat Party. President Harris declares the Democratic-Socialists' Future of America will continue into her second term.

None of These Plans Are Secret

Do you think these scenarios are farfetched? Do you believe they aren't feasible?

If we listen to the promises and intentions of Democrats today, all of this follows in a logical order. If the Democrats win the presidency and both the House and Senate with the 2020 election, they can get rid of the filibuster, pass whatever legislation they want, and use the promise of amnesty to add to their voter rolls and help neutralize any voter blowback to their radical actions.

This is why this next election is so monumental. There is no middle in American politics today...

If the anti-Trump resistance loses, there's a realistic chance that the radical left will have its back broken by Trump over the next four years. That could lead to moderation and, paradoxically, greater unity for the country down the line.

But if the Democrats win this round – given their collective mentality and far-reaching policy plans – they may seize the opportunity to finish off their Republican rivals once and for all.

They only have to control the system one more time to change it forever. And they know it.

Has gold done its correction?

Gold has had a fantastic run in the past few months, so much so that it is showing a parabolic move lately, virtually vertical line up. This kind of move is not sustainable and sooner or later, it will need to take a rest. As expected, gold is finally hitting the ceiling at least for the near term and turning back. A 5% decline within a day a few days ago must be quite painful for those who are chasing it lately. But I think more pain is likely to come in the near future.   

This was what I wrote about 2 months ago when gold topped over around $2075. Here is the chart for gold at the moment. As you can see, it has dropped roughly about 11% since Aug. As I said back then, I wouldn't be surprised to see gold shedding off 20-25% from its recent top. But this is just based on the historical experience and we all know TA is more an art than a science with no certainty. Based on this chart, gold can continue to drift down towards its 200 DMA around $1730ish, which is also a strong support for it from its breakout level back in May/June. On the other hand, its momentum indicators like RSI and MACD have already reached their bottom near the oversold territory and as such, it's hard to argue for a much lower level to go at the moment. Also taking into consideration the current quite fluid situation with the very uncertain election prospects that may last for a few months, gold could turn out to be a safe haven in the turmoil. 

There is another wrinkle in the equation, the US$ trend. At least in the short term, gold tends to go inversely with the dollar. Right now, the dollar is poised to shoot up. Look at  the US dollar via UUP… In other words, there is a good chance that US$ will go up from here that may negatively impact gold. 

Putting all together, it is not a clear cut situation as a couple of months ago that gold was clearly topped over for an immediate downturn. Right now, it is more like a no man's land where it can chop around for a while and may go either direction. My bet is that it is much closer to the bottom and has more potential to go up from here but it won't be a straight up line. 

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By the way, if you are interested in joining my DW investment group, we have set up a Telegram group. 

Here is the link for "DW  谈股论金": https://t.me/joinchat/SgYa_xNrjTNHk9cS51ke0A.    

Importantly, you cannot join directly via Wechat. Two options:

1. When open the blog in Wechat,  点击右上角的三点，然后选在Safari 中open，然后点击the link and then join 
2. Or copy the link and paste to Safari to open and then join 

Elevated volatility post election

First of all, God bless President Trump, the First Lady and the United States of America! Hope Trump and FLOUS will have a speedy recovery!!

The news of the COVID19 infection by the President triggered a panicky selloff worldwide overnight and throughout today. No question there is no way to predict this kind of unexpected sudden incidents that will scare the market. But believe or not, the market has actually already sent some warnings for the downside risk in the past few days, although the bouncing back in the past few days seemed quite strong. I have already heard some folks talking about new highs🤕.  As I showed to my Telegram/Wechat groups a couple of days ago, even though the market was pushing higher, it was unlikely to hold up per the short term TA indicators and a high chance to go down again soon. Today's harsh selloff confirmed what the indicators told us. Having said that, as I told my groups again this morning, I thought the market might likely close higher than the opening level and it did recovered half of the initial loss. Given that, there is a good chance the market may try to bounce back again early next week, baring significant bad news popping up over the weekend. But be aware of the underlying more severe risks in the longer term as discussed below. 

  

But before I continue, in light of the very volatile and turbulent time period, hope this short cute baby goat reunion with her mom can bring some peace to you!🌹💫 Medical studies have demonstrated that often viewing cute and lovely animal photos or videos has a good antidepressant effect. Hope this baby goat's lovely moment can alleviate some anxiety for some folks.  😏

As I have alluded to recently, I think we are likely going to see a very uncertain post-election era that will dampen the market! Here you go to see bets Increasing on Post-Election Volatility. The chart below shows that S&P 500 put options are reflecting the possibility that U.S. election results will get finalized with a delay. In other words,  volatility is expected to remain elevated after the elections.   With all the issues surrounding mail-in ballots, there is virtually no chance we will see a final result on the election day, Nov 3. Will be lucky to see it even a week later. I personally believe it will at least take weeks with uncertainty and eventually the Supreme Court may likely be brought in to make a final determination who will be the next US President! If you think the current volatility has already made you nervous, it is just like a walk on the beach now before we slip into much stronger turbulent waves soon.  So enjoy the current relatively calm time and try to do something to protect yourself!! 

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By the way, if you are interested in joining my DW investment group, we have set up a Telegram group. 

Here is the link for "DW  谈股论金": https://t.me/joinchat/SgYa_xNrjTNHk9cS51ke0A.    

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