via Stockcharts.com - GDX Forms Bearish Engulfing

It might come as a surprise, but gold prices in Canadian dollars topped $1500/oz. this week.($CAD fell against $US) Considering that most listed gold miners are Canadian companies, you would expect that their shares prices aught to reflect a strong commodity price.

But that didn't happen. The activity in gold miners, where they showed a bearish engulfing on the daily chart reflects more the move in TLT.

TLT prices rose, along with a decline in interest rates. Since just about every gold miner has a negative carry in short interest due to equity swaps, their share prices will be directly affected.

It's very apparent from price moves this week that TLT is the hedge used in equity swaps in vogue over gold miners.

Don't Ignore This Chart! - Stockcharts.com

TLT Weekly

TLT gapped up to bounce above its pivot point, set last year. TLT is not pricing in movement in long term bonds, which have broken below their own pivot point, two months ago.

Overall, bonds do not have the downside momentum you keep hearing about, but the interim correction will probably continue. After key Federal Reserve statments, bonds normally rally for a few days, then the correction resumes.

The TLT is lagging bond markets for some reason, but will eventually have to show the same move. You never hear about TLT selling its assets as prices decline, as you would GLD.

A sell-off in major indeces can preclude a collapse in bond prices.

http://scharts.co/16NCMif

$ONE:GBN.V Weekly

In what is perhaps the clearest indication of a reversal of fortunes in GBN.V shares, the ADX directional movement indicator has had a crossover of its green and red lines.

The MD&A has one important line to take note of, and that is the company has no off balance sheet transactions and none are proposed. (Sprott settled off their equity swaps with TD Securities last year.)

Waterton is still in the picture, but they must be scratching their heads, because they just missed out on the opportunity to buy their gold off the company at a major discount during the gold price rout. Are they really still buying gold out of the mine, or have they written off their deal, since GBN.V is not the distressed company that they thought?

A major contradiction in the MD&A is that the mill was supposed to be under refurbishment, but you see that the mill was under repairs. So which is it? Of course, year-end results for fiscal 2013 are a coprophagic breakfast on a plastic tray under a cellophane wrap for shareholders.

On the day financial results were released, the share price was down, mostly by sell-side brokers attempting to cause a panic, but that organ has been thoroughly dessicated by now. Instead, share prices were up the next day.

http://scharts.co/16dStif

-F6