Potentially a major test for precious metals/mining stocks with tomorrow's July CPI report. Sustained buying out of the East (Asia) kept gold above $4,000 during the recent multi-month correction. That eventually led to some encouraging bottoming action culminating in last week's explosive up surge - which is not atypical at the start of bull market moves. However, if inflation's hot - will it lead to a significant retracement of last week's gains? In just five days last week, the GDX gold miner ETF soared 21.3% - erasing the declines from the prior nine weeks. That ferocious move also made it difficult for the many investors caught on the sidelines to get back in. GLD has seen 15 tons of inflows over the last five days - but that would just be a start if we're in another big bull move. Futures traders' gold open interest is still extremely low at just under 400K contracts - so there's lots of potential buying fuel. A hot CPI could provide another chance to get back in or add to one's positions once any retracement runs out of steam. Newsletter subs. know I had added to my gold miner positions since late-June thru July after reducing them significantly late last year into early this year. Nevertheless, I still would like the opportunity to buy more before gold rallies again (as I expect). Tomorrow and the next several days will determine whether I get that chance.

Excellent article (as usual) from WSJ's James Mackintosh titled: "AI Chip Mania Sows Seeds of Its Own Destruction" However, I have one quibble with this statement: "A final risk is that supercharged profits attract new rivals to enter the market. For now, that seems unlikely in the superfast memory Micron makes, but it’s already happening with other highly profitable chips used in AI." Here's a recent headline from DigiTimes: "China's memory capacity surge led by YMTC and CXMT shifts global supply in AI cycle" From the story: "Global memory markets are entering a new restructuring cycle driven by AI demand, with China's YMTC and CXMT scaling capacity and state-backed investment to gain share in a sector long led by US, South Korean, and Japanese suppliers." The AI-driven shortages (worst I've ever seen) have driven prices to the moon (temporarily), but the shortages (and profits and help from the Chinese government) are enabling the buildup of a larger, more potent competitive Chinese supplier threat to the "Big 3" DRAM makers - Micron, Samsung and Hynix. YMTC and CXMT are making inroads into the PC end market due to the datacenter buildout-driven shortages, but in addition, both suppliers are working on higher-end HBM DRAM offerings, with CMXT reportedly planning to ramp up HBM3 production later this year. So, the problem for the legacy DRAM makers will likely be both demand and supply driven in coming years. Eventually, the market will begin to discount a much more competitive environment in the commodity memory markets than was the case before this latest upcycle began.