$TNX:!PRII Weekly

The TNX/PRII Weekly was smashed higher on central bank intervention in the markets. The Nikkei rallied almost 8% on the day, after have tumbled. There would be no other way that markets would see such a junp unless there was a mania of some sort, or direct central bank intervention. It is no secret that the JCB intervenes heavily in the markets, it should come as no mystery that the Federal Resrve in the U.S. would have done exactly the same.

As a result, gold prices declined as they are strongly inversely correlated. The difference between the late 2010/early 2011 rally and reversal was that this indicator never tested the 89-week EMA.

A reversal in this indicator would mean higher and more robust gold prices, but ostensibly woukd come on the rout on the S&P. But there is also an impending moving average crossover, which dies not bode well for gold prices at all.

The volatility index has long been indicating some sort of correction and we saw what it looks like if only for a brief moment in overnight trade with the S&P limit down briefly. Gold notably did the opposite but gains have so far been erased.

http://schrts.co/bTtSjF

-F6