Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key.
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it?
<< <i>Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key.
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it? >>
Maybe next year? At least gold should move up in price some by 2014!
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I don't agree that $980 is a key area any longer following the sustained multi-day breakout occurring beyond $1000 the past 2 weeks...the first ever such beakout with gold inside the trading range the entire time. A break below $982 will for now only mean a re-test of various levels somewhere between $955 to $975...and that's needed after a rise from $904 that began in mid-April. A drop below the $950 level would not be terribly damaging. But a drop below the last $931 low would certainly be.
Forget the negativism. It's already here in spades with many gold bulls having already tossed out their positions waiting for an October SM crash. A 5% correction in the gold price and you'd have thought the world just caved in! Gold stocks have been tossed out and generic gold coins are supposedly going begging now. A retest of the April-August consolidation triangle would actually be healthy right now. In fact I see the odds of gold breaking $982 and holding at $960-$975 to be the most likely course right now. I seriously doubt we'll see anything lower until after a new all time high occurs. Just my 2 cents. And the odds of that all time high in Oct.-Dec. 2009 just increased greatly with the action of the last 2 weeks. The dollar will blip up for a bit to get everyone thinking "another autumn" SM and gold dump...then both will come roaring back to new highs while the dollar index continues heading for 74. Patience....$1050 gold will come soon enough. It will come when everyone is lulled to sleep again and figuring Santa is not coming this year.
It did rise too fast from the $930-$950 level. It does need some time off. And apparently it has convinced most bulls that $850 is coming soon.
RR, while something kind of tells me you're right, I do have a different perspective. It's more of a bigger picture view, if you consider that gold has been consolidating between $990 and $1020. $990 has held up amazingly well, and I expect it to continue doing so. I'll only be concerned on a serious breach of $990 that doesn't quickly recover. One indication that I do like is the stock market rally today back up to 1060 (~25 points for the ES) and silver holding strong near $16.20. It's not really matching the dollar strength like gold is. One article I read says there is "massive unlimited demand" beneath the $986 level. I wouldn't be surprised to see gold meander up to and over $1000 tonight/tomorrow.
Support is at $986.7 for tonight/Tues, and resistance is at $992, $998, and 1003.5, and 1014.
One writer did say that once the 20DMA is breached, a test of the 50DMA is likely, and that would be $970. Even then it still wouldn't be bearish to test down to $950, which I would expect to be very quick if it does happen.
My view is heavily influenced by the charts, I admit that. I studied the down turns of this year in a lot of detail while they were happening. This just smells like every one of those and the charts almost beg for additional weakness before things turn back. This based on Aroon10/15 crosses, StochRsi, BB 10/20 shapes, MACD 6/9/12, RSI 7/14, Trix 6/9/15 etc. No matter how I look at it, I can't see anything sniffing strength. Well there is one bright spot. That's with BVN hanging high and still showing semi-bullish indicators...unlike almost every other intermediate/senior goldie. BVN has done this before to signal strength coming down the road, but usually it has some company even if a very small group. It finally has the SS drop below 80 today. I don't see anyone else hanging this tough.
But big picture-wise we are on the same wave-length figuring that downside damage is to be contained well up into the $900's. There has been so much talk of another fall 2008 shakeout that the PTB are keeping J6P out of stocks and most everyone away from PM's....as it should be while climbing the walls of worry. The dollar isn't exactly looking like it's ready to take on 80 again.
None of those items has exceeded it's all time high. But then again, nothing in the financial arena that I can think of is anywhere near an all time high....not bonds, not real estate, not stocks, not commodities, not derivatives, etc. There may be exceptions but not many. Gold achieving 99+% of it's all time high this month is one of the front runners. If you chart gold against the dollar index it is actually quite a bit short. Charting gold against Udn (other currencies in the dollar index) then gold has made a new all time high vs. 2008.
But using that original logic to gold in 1977 making higher lows following an 18 month correction from August 1974 - December 1976 would have lead one to believe that gold was ultimately going further down...that is until it made a new all-time high in early 1978 and kept going.
I don't discount the possibility than gold could still experience a blood curdling C wave down to complete the ABC from March 2008. Yeah, that would stink bigtime. Gold would take about a year off before returning to 2009 levels. It could take gold back into the $600's where Nadler's Army could finally load up. It would be the classic wipeout and erase nearly every bull from the map....except the bankers and those holding physical. The rise from that point would probably be huge. The dollar would have to have some reason to go up about 25-30% again in the face of monstrous QE and monetizing $TRILLIONS in debt. I have a hard time seeing how that plays out without another planned deleveraging event.
I don't discount the possibility than gold could still experience a blood curdling C wave down to complete the ABC from March 2008.
There are actually quite a few stocks that are at 52 wk highs, believe it or not, some are retail names.
That concerns me also. I'm not buying this "breakout" in gold yet. The "sell the dollar trade" is very crowded. Japan is still exporting deflation, China's stimulus is doing nothing do build domestic consumption, Europe has just about depleted their stimulus funds and the USA is operating at 69% of capacity. Oil has failed at $75 and I believe this "green shoots" theory is simply inventory adjustment. Grains prices are at 2 year lows. Inflation is still years away.
Usually mining stocks lead the metals, the fact they havent broken out yet is something to think about.
I was only interested in all time highs going back to fall 2007. It doesn't matter so much to me that we are at 52 week highs. Goldman is only $6 away from their 52 wk high but 30% from the fall 2007 all time high. The weaker dollar has reduced those numbers even further over 2 years.
Gold stocks lead the way in the first phase of the gold move from 2001-2004 but basically underperformed gold from 2005-2008. It's not clear to me whether they have to lead gold to a new high or not. Since they are tied somewhat to the stock market they can do most anything. Their tiny market caps, and ability to be easily naked short them via the Canadian market where rules are much more lax make them an easy target for the bankers and PPT. It's one of the easiest ways to clobber gold short of dropping leased central bank tonnage on the market in one big dump. Problem is, someday the CB's are gonna want those tons back....
I did forget to mention, the ECRI indicator last week climbed again to an astounding rate of 24.3%. If this indicator is accurate at all, it will be the engine that drives gold's price over the next year or two, and it will be amazing, even if it's not genuine.
Aeropostale is at an all-time high. It is a retail clothing company. Priceline.com is at an all-time high. Ask Bill Shatner. Green Mountain Coffee is at an all-time high. Name self explanatory.
There are many others.
Gold stocks lead the way in the first phase of the gold move from 2001-2004 but basically underperformed gold from 2005-2008. It's not clear to me whether they have to lead gold to a new high or not
Both XAU and GDX hit highs in Mar 2008. The stock market had little to do with the mining stocks during the Depression. So far they are not indicating that a sustainable run in gold is about to commence.
Their tiny market caps, and ability to be easily naked short them via the Canadian market where rules are much more lax make them an easy target for the bankers and PPT
The PPT couldnt give a flying ---- about junior gold mining companies. And please, please never invest in a company that trades on the Vancouver exchange. Please. I agree the companies are easy to manipulate on the Canadian exchanges but there is no conspiracy.
Aside from a few quick tails, gold bounced at its support level at 988. $990 is holding up well yet again, despite continued rise in the USD. Equities also held up with the S&P500 holding most of its gains from yeterday and holding above 1055.
I charted USD futures (DX) and there's a downward channel I've drawn. At this point, the upper boundary is at 78.0, if I've drawn it correctly. With USD with a recent high of 77.73, the upward move in the dollar is almost done if this channel is in control, which will provide relief to gold.
From what I've been reading, inflation is when the money is printed. So, the inflation has already taken place. Changes in price are a consequence. To think it years away is what the government lackeys are telling us. Since they haven't been truthful to us yet, I tend to disagree.
Out of thousands of stocks what's the new percentage of all time highs? Certainly well under 10%. Maybe even under 1%.
Both XAU and GDX hit highs in Mar 2008......yes, but they outperformed gold in the first half of the 6 year run, and underperformed it in the later half. Homestake was one of the miners in the depression and continued to mine into the early 1990's. There are others. They outperformed the Dow for years during the GD. The "tiny" market caps I was talking about was not the juniors, but the seniors. Actually the sum of all the gold miners is similar in size to a major US corporation. Any of them by themselves are tiny and insignificant vs SM/Bonds. But they hold a lot of sway over pog. I have no doubt the PPT (or at least their henchmen) have orders to hit Barrick, Goldcorp, Newmont, and GDX from time to time. Why wouldn't they? I would also toss in some of the more hotly contested intermediates like AUY, EGO, etc. It only takes a few hits to a couple of the more important miners to get a slide going. You can bet your bottom dollar they do it. There are few cheaper ways to move the dollar market than through a naked gold stock bashing, whether via US or foreign exchanges. Much harder to move futures and even harder to move the dollar via the forex. Why would they do anything the hard way?
I don't know if the Vancouver exchange is the same as Toronto. But some of the best values in mining companies only trade on Toronto. I wish the NYSE/AMEX offered some of those choices. As the market heats up more will become covered, but not enough.
Wolf359, Steve Saville had a good article today on money supply growth and velocity. The St. Louis Fed's current chart on Velocity shows it dropping for some time now. No surprise. The money supply growth in M2 and M3 have decelerated the past year or so but are still in the +4 to +8% yoy range (see stats.com below for M3 and M2 charts). M1 is at 18% yoy. Saville feels inflation is coming but not soon due to the slowdown in money supply growth and velocity of money. He feels that even a slowing of monetary growth is deflationary right now. There are so many views on inflation vs deflation that it's getting old. The dollar really doesn't care which one is in control. If the dollar loses confidence, gold goes up relative to it in either scenario. If GDP is even worse that published and I suspect it is (due to the erroneous deflator calculation), then velocity is even lower than published. Then again, what's more important, velocity of the real money supply or velocity of credit/money in the shadow banking system that is not tracked? You can get inflation from either or both sources. There are fresh TRILLIONs being tossed into the shadow system right now. And it has velocity even if J6P is not involved. Joe won't be involved with gold either. The shadow banking system had incredible velocity and growth in the 1998-2007 period but it was not reported while inflation from the standard M1,2,3 money systems was reported as fairly low and certainly controllable. Which one is more important? I think we've at least learned that deficits and derivatives do matter after all.
Miners today seemed like they tried to turn the corner. Gold and silver not quite. Still some concerns that the dollar, treasuries, and GSR are still fighting that potential turn with upward momentum. Just may be a false break on the miners. BVN is still near it's 2009 high and has that look of being ready to bolt....one way or the other. The volume is now very low for most gold related stocks which makes things riper for a turn. Getting close to a short term bottom if not there already, but I'm not ready to bite yet. Tomorrow is last day of the quarter to clean up balance sheets. And why not punch gold down one more small step to put more shorts and puts in the money?
P/E ratio of the S&P is 129. I have no idea what that means with the new math, but thought it sounded intelligent to post
Do your best to avoid circular arguments, as it will help you reason better, because better reasoning is often a result of avoiding circular arguments.
<< <i>Looks like gold may test 1000.00 tonite overseas.....silver @ 16.29...... >>
I hope you're right but it's too early to tell. Gold keeps getting rebuffed at $996-997. I say if gold doesn't take $1000 back soon, then the odds are we'll head south before we go north. Gold's just been stuck between $990-996, and it's causing me to lose a lot of sleep.
Equities held on today, which is good, and the dollar struggled after hitting recent highs. Silver appears to be turning up a little bit before gold.
One thing's for sure, gold is doing a GREAT JOB of bringing in negative sentiment. And negative sentiment toward gold is a perfect recipe for a VERY nice breakout.
I remain watchful for a breakout over $1008 (or at least $1000) or a breakdown below $986.
Support and resistance levels for Wed are almost the same as yesterday. Support at $982, 988, 993, and resistance at $999, 1004.4, 1015.
Fact is, many stocks in varied industries are at all time highs. Is gold? Someday gold will make everyone feel smart.
Roadrunner, anyone with $10 million to trade can "work" the prices on the mining companies. Heck, I used to move the stock of Krispy Kreme with just a few 100k. It doesnt have to be the big, bad PPT. You mention why wouldnt they, I ask, why would they?
<< <i>Out of thousands of stocks what's the new percentage of all time highs? Certainly well under 10%. Maybe even under 1%. >>
We have had a significant increase in the number of stocks hitting new 52 week highs...
As for as the relative strength of the market if you look at the percentage of stocks trading above the 50-day SMA you get the following...
The interesting thing is if you plot the $nya50r (non log b/c it is already a relative scale) with the SPX, anything above 75-80ish% of stocks trading above the 50-day SMA over the past three years has generally signaled a temp top.
When looking at volume, if you remove the trading volume from the financial Phoenix stocks (the financials that have risen from the ashes) "the overall trading volume we have NYSE is at the lowest level in years. Healthy bull markets, even if not during the earliest days of a rally, will typically recruit growing amounts of investor interest and expanding levels of volume as prices rise. Expanding volume continues to be an important characteristic missing from this rally."
<< <i>From what I've been reading, inflation is when the money is printed. So, the inflation has already taken place. Changes in price are a consequence. To think it years away is what the government lackeys are telling us. Since they haven't been truthful to us yet, I tend to disagree. >>
Its a chicken or egg scenerio. I contend that the printing of money occurs to combat inflation. In the present situation, has new money been created---ie is there more money floating around now than 2 years ago? If so, then I'll buy your arguement. I dont believe there is more money today than 2 years ago and coupled with massive excess in the manufacturing side of the economy, the only imbalance I see is deflationary. The bond markets see this also.
Gold has rallied not due to inflation fears, but rather fiat fears.
Commodity cycles last 20 years. The biggest moves always occur at the end of cycles. In 2020---or about 20 years after the commodity cycle started, the baby boomers will be leaving the workforce en masse. This will create a labor shortage which will boost wages. This is when gold will really shine.
Interesting that you mentioned the commodity cycles. I have been looking into the gold dow ratio since the late 1800 and The charts are very interesting...
If the past hold true again, it points to gold being aroung the 1800-2200ish range around 2012... Looking at the Silver Gold Ratio of the past 13 years of 61, silver should be around 29.5 - 36.1 area.
Thoughts?
Remember that the market can stay irrational longer than you can stay solvent.
Gold is back above $1,000 this morning. the sell off was arrested at about 990 as I hoped.
Just a reminder of what I posted on Monday:
**********************
Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key.
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it?
Fact is, many stocks in varied industries are at all time highs. Is gold? Someday gold will make everyone feel smart.
So what is the % of stocks at all time highs? 5%? 1%? If you use the DOW is it 0%? It's low whatever it is as we are 30% down from the 2007 blow off. It matters little to me what stocks are at 52 week highs just like it mattered in 1931-1933. Whether gold made it to 99.2% of the ATH or 100.1% hardly seems to be a critical factor. Within 2-8 months the concern with gold's ATH will be resolved.
Gold has made all times high in most (not all) other major currencies. The only reason gold vs. the dollar has fallen <1% short of a new all-time high is because we hold the reserve currency and have a much more active FED, Treasury, and PPT behind the dollar. The Europeans, Chinese, and Japanese don't own the reserve currency and don't have to worry about defending it. It doesn't hurt that our leading banks are in on the game plan as well and that central banks have been leasing out thousands of tons of gold to bullion banks to assist. What's the only asset that CB's own that they can dump on the market? What happens when it's effectively all gone? Even with rigged markets they've "successfully" held gold to only a quadruple so far....a 4-bagger. That's a home run. It is currently ticking off time above $900 and $1000/oz...where <30% of the time was spent above those numbers in 2008. Time is often said to be more important than price. Soon, the time will be up...and that price will come.
Gold's turn around in the past 24 hours was pretty swift. While a welcome sight instead of $960 I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November. But it is nice to see the strength over $1000 again. It's feeling a lot more like a new all time high is coming this year.
<< <i>Gold's turn around in the past 24 hours was pretty swift. While a welcome sight instead of $960 I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November. But it is nice to see the strength over $1000 again. It's feeling a lot more like a new all time high is coming this year. >>
With the move above $1008 which appears to be holding, we're in good shape for the up-trend to start, although for now we're still in consolidation mode. It's critical to keep an eye on the S&P... if it breaks out over 1060, watch for gold to move to all time highs.
Todays move was fairly critical, IMO, as it whould establish a close above $1000 for the month and for the quarter.
Todays move was fairly critical, IMO, as it whould establish a close above $1000 for the month and for the quarter.
That's why I didn't expect to see any real strength occuring today as end of month and quarter sheets were cleaned up. An end of month close at $1000? The boyz must be losing their touch.
<< <i>Todays move was fairly critical, IMO, as it whould establish a close above $1000 for the month and for the quarter.
That's why I didn't expect to see any real strength occuring today as end of month and quarter sheets were cleaned up. An end of month close at $1000? The boyz must be losing their touch. >>
Well the day isn't over.
RR - do you know if the closing figure is considered when the stock markets close? 1pm Pacific? Or when the future market closes, about an hour later? It is disappointing to see the S&P getting hit hard the last half hour, it will be interesting to see if this carries over to gold.
PC, as we discussed this once before, you can use various closing times. So it differs on whether you talk to a Comex gold bullion trader or a stock broker. If either closed above $1000 that would be good enough for me. The on-line closes are typically stock market 4 pm. I'm with you, I'd expect some efforts to try and get it under $1000 by 4 pm.
Today's multi-humped gold chart with some quick spikes sure is strange looking.
Roadrunner, you surprise me... you wrote: "I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November."
where is the raging gold bull of a few months ago???
<< <i>Roadrunner, you surprise me... you wrote: "I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November."
where is the raging gold bull of a few months ago???
Am I now the gold cheerleader here???? >>
I think your opinion of RR and probably me is over-simplified. Long term, I would consider myself a bull, and RR probably would too, but only in the long term (multi-year) perspective. This really is a short term trading thread though. Realizing that not everything goes straight up or down, one can still be a bull yet predict or "call for" a decline to occur over the next day/week/month. Regardless of my long term views, I'd still like to play both sides of a pull-back or re-test if I can see it coming. Overall, we're just voicing our interpretations of the charts as they unfold. It's a mistake to introduce personal bias into chart interpretations, and I'd like to think that RR and I do that the best we can.
To all: I'll probably start the October thread tonight with support and resistance levels for Thursday.
Sorry MoneyLA, you can't join the raging bull club until you repudiate your "trading range" philosophy.........
If you look back months, all I've said this year (up until this run to $1025) was that we would see gold hit a new all time high by May of 2010. I didn't take any "bearish" heat for those comments. Most everyone else was saying gold was cooked and a new high was years away. With the current action, a run to a new all time high this year is pretty bullish imo considering the potential for another deleveraging event is always out there. With all factors involved I do feel the short term (2-7 weeks) is in favor of a further correction, even if it's just more time rather than price drops. As PC said this thread is about short term trading and trying to catch up and down swings. It's not about being bullish or bearish, but hopefully about being more right than wrong.
I have plenty of skin in this game, so by definition I am a cheerleader. On these threads I'd rather present pros and cons as I run across them rather than just cheering for gold to always go higher, which of course it cannot do. I play mostly in gold stocks and generic gold coins rather than pure bullion, so my daily views are often slanted in that direction.
Comments
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it?
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<< <i>Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key.
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it? >>
Maybe next year? At least gold should move up in price some by 2014!
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<< <i>Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key. >>
Why 980 and not 970 (50 DMA) or 960 (point of breakout and significant support)?
Says it it must be so!
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Forget the negativism. It's already here in spades with many gold bulls having already tossed out their positions waiting for an October SM crash. A 5% correction in the gold price and you'd have thought the world just caved in! Gold stocks have been tossed out and generic gold coins are supposedly going begging now. A retest of the April-August consolidation triangle would actually be healthy right now. In fact I see the odds of gold breaking $982 and holding at $960-$975 to be the most likely course right now. I seriously doubt we'll see anything lower until after a new all time high occurs. Just my 2 cents. And the odds of that all time high in Oct.-Dec. 2009 just increased greatly with the action of the last 2 weeks. The dollar will blip up for a bit to get everyone thinking "another autumn" SM and gold dump...then both will come roaring back to new highs while the dollar index continues heading for 74. Patience....$1050 gold will come soon enough. It will come when everyone is lulled to sleep again and figuring Santa is not coming this year.
It did rise too fast from the $930-$950 level. It does need some time off. And apparently it has convinced most bulls that $850 is coming soon.
roadrunner
Support is at $986.7 for tonight/Tues, and resistance is at $992, $998, and 1003.5, and 1014.
One writer did say that once the 20DMA is breached, a test of the 50DMA is likely, and that would be $970. Even then it still wouldn't be bearish to test down to $950, which I would expect to be very quick if it does happen.
But big picture-wise we are on the same wave-length figuring that downside damage is to be contained well up into the $900's. There has been so much talk of another fall 2008 shakeout that the PTB are keeping J6P out of stocks and most everyone away from PM's....as it should be while climbing the walls of worry. The dollar isn't exactly looking like it's ready to take on 80 again.
roadrunner
Knowledge is the enemy of fear
But using that original logic to gold in 1977 making higher lows following an 18 month correction from August 1974 - December 1976 would have lead one to believe that gold was ultimately going further down...that is until it made a new all-time high in early 1978 and kept going.
I don't discount the possibility than gold could still experience a blood curdling C wave down to complete the ABC from March 2008. Yeah, that would stink bigtime. Gold would take about a year off before returning to 2009 levels. It could take gold back into the $600's where Nadler's Army could finally load up. It would be the classic wipeout and erase nearly every bull from the map....except the bankers and those holding physical. The rise from that point would probably be huge. The dollar would have to have some reason to go up about 25-30% again in the face of monstrous QE and monetizing $TRILLIONS in debt. I have a hard time seeing how that plays out without another planned deleveraging event.
roadrunner
There are actually quite a few stocks that are at 52 wk highs, believe it or not, some are retail names.
That concerns me also. I'm not buying this "breakout" in gold yet. The "sell the dollar trade" is very crowded. Japan is still exporting deflation, China's stimulus is doing nothing do build domestic consumption, Europe has just about depleted their stimulus funds and the USA is operating at 69% of capacity. Oil has failed at $75 and I believe this "green shoots" theory is simply inventory adjustment. Grains prices are at 2 year lows. Inflation is still years away.
Usually mining stocks lead the metals, the fact they havent broken out yet is something to think about.
Knowledge is the enemy of fear
Gold stocks lead the way in the first phase of the gold move from 2001-2004 but basically underperformed gold from 2005-2008. It's not clear to me whether they have to lead gold to a new high or not. Since they are tied somewhat to the stock market they can do most anything. Their tiny market caps, and ability to be easily naked short them via the Canadian market where rules are much more lax make them an easy target for the bankers and PPT. It's one of the easiest ways to clobber gold short of dropping leased central bank tonnage on the market in one big dump. Problem is, someday the CB's are gonna want those tons back....
roadrunner
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mariner67, and Mikes coins
Priceline.com is at an all-time high. Ask Bill Shatner.
Green Mountain Coffee is at an all-time high. Name self explanatory.
There are many others.
Gold stocks lead the way in the first phase of the gold move from 2001-2004 but basically underperformed gold from 2005-2008. It's not clear to me whether they have to lead gold to a new high or not
Both XAU and GDX hit highs in Mar 2008. The stock market had little to do with the mining stocks during the Depression. So far they are not indicating that a sustainable run in gold is about to commence.
Their tiny market caps, and ability to be easily naked short them via the Canadian market where rules are much more lax make them an easy target for the bankers and PPT
The PPT couldnt give a flying ---- about junior gold mining companies. And please, please never invest in a company that trades on the Vancouver exchange. Please. I agree the companies are easy to manipulate on the Canadian exchanges but there is no conspiracy.
Knowledge is the enemy of fear
<< <i>$987.00 and falling fast this morning! >>
Aside from a few quick tails, gold bounced at its support level at 988. $990 is holding up well yet again, despite continued rise in the USD. Equities also held up with the S&P500 holding most of its gains from yeterday and holding above 1055.
I charted USD futures (DX) and there's a downward channel I've drawn. At this point, the upper boundary is at 78.0, if I've drawn it correctly. With USD with a recent high of 77.73, the upward move in the dollar is almost done if this channel is in control, which will provide relief to gold.
what the government lackeys are telling us. Since they haven't been truthful to us yet, I tend to disagree.
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Both XAU and GDX hit highs in Mar 2008......yes, but they outperformed gold in the first half of the 6 year run, and underperformed it in the later half. Homestake was one of the miners in the depression and continued to mine into the early 1990's. There are others. They outperformed the Dow for years during the GD. The "tiny" market caps I was talking about was not the juniors, but the seniors. Actually the sum of all the gold miners is similar in size to a major US corporation. Any of them by themselves are tiny and insignificant vs SM/Bonds. But they hold a lot of sway over pog. I have no doubt the PPT (or at least their henchmen) have orders to hit Barrick, Goldcorp, Newmont, and GDX from time to time. Why wouldn't they? I would also toss in some of the more hotly contested intermediates like AUY, EGO, etc. It only takes a few hits to a couple of the more important miners to get a slide going. You can bet your bottom dollar they do it. There are few cheaper ways to move the dollar market than through a naked gold stock bashing, whether via US or foreign exchanges. Much harder to move futures and even harder to move the dollar via the forex. Why would they do anything the hard way?
I don't know if the Vancouver exchange is the same as Toronto. But some of the best values in mining companies only trade on Toronto. I wish the NYSE/AMEX offered some of those choices. As the market heats up more will become covered, but not enough.
Wolf359, Steve Saville had a good article today on money supply growth and velocity. The St. Louis Fed's current chart on Velocity shows it dropping for some time now. No surprise. The money supply growth in M2 and M3 have decelerated the past year or so but are still in the +4 to +8% yoy range (see stats.com below for M3 and M2 charts). M1 is at 18% yoy. Saville feels inflation is coming but not soon due to the slowdown in money supply growth and velocity of money. He feels that even a slowing of monetary growth is deflationary right now. There are so many views on inflation vs deflation that it's getting old. The dollar really doesn't care which one is in control. If the dollar loses confidence, gold goes up relative to it in either scenario. If GDP is even worse that published and I suspect it is (due to the erroneous deflator calculation), then velocity is even lower than published. Then again, what's more important, velocity of the real money supply or velocity of credit/money in the shadow banking system that is not tracked? You can get inflation from either or both sources. There are fresh TRILLIONs being tossed into the shadow system right now. And it has velocity even if J6P is not involved. Joe won't be involved with gold either. The shadow banking system had incredible velocity and growth in the 1998-2007 period but it was not reported while inflation from the standard M1,2,3 money systems was reported as fairly low and certainly controllable. Which one is more important? I think we've at least learned that deficits and derivatives do matter after all.
Miners today seemed like they tried to turn the corner. Gold and silver not quite. Still some concerns that the dollar, treasuries, and GSR are still fighting that potential turn with upward momentum. Just may be a false break on the miners. BVN is still near it's 2009 high and has that look of being ready to bolt....one way or the other. The volume is now very low for most gold related stocks which makes things riper for a turn. Getting close to a short term bottom if not there already, but I'm not ready to bite yet. Tomorrow is last day of the quarter to clean up balance sheets. And why not punch gold down one more small step to put more shorts and puts in the money?
roadrunner
roadrunner
Looks like gold may test 1000.00 tonite overseas.....silver @ 16.29......
<< <i>Looks like gold may test 1000.00 tonite overseas.....silver @ 16.29......
I hope you're right but it's too early to tell. Gold keeps getting rebuffed at $996-997. I say if gold doesn't take $1000 back soon, then the odds are we'll head south before we go north. Gold's just been stuck between $990-996, and it's causing me to lose a lot of sleep.
Equities held on today, which is good, and the dollar struggled after hitting recent highs. Silver appears to be turning up a little bit before gold.
One thing's for sure, gold is doing a GREAT JOB of bringing in negative sentiment. And negative sentiment toward gold is a perfect recipe for a VERY nice breakout.
I remain watchful for a breakout over $1008 (or at least $1000) or a breakdown below $986.
Support and resistance levels for Wed are almost the same as yesterday. Support at $982, 988, 993, and resistance at $999, 1004.4, 1015.
Roadrunner, anyone with $10 million to trade can "work" the prices on the mining companies. Heck, I used to move the stock of Krispy Kreme with just a few 100k. It doesnt have to be the big, bad PPT. You mention why wouldnt they, I ask, why would they?
Knowledge is the enemy of fear
<< <i>Out of thousands of stocks what's the new percentage of all time highs? Certainly well under 10%. Maybe even under 1%. >>
We have had a significant increase in the number of stocks hitting new 52 week highs...
As for as the relative strength of the market if you look at the percentage of stocks trading above the 50-day SMA you get the following...
The interesting thing is if you plot the $nya50r (non log b/c it is already a relative scale) with the SPX, anything above 75-80ish% of stocks trading above the 50-day SMA over the past three years has generally signaled a temp top.
When looking at volume, if you remove the trading volume from the financial Phoenix stocks (the financials that have risen from the ashes) "the overall trading volume we have NYSE is at the lowest level in years. Healthy bull markets, even if not during the earliest days of a rally, will typically recruit growing amounts of investor interest and expanding levels of volume as prices rise. Expanding volume continues to be an important characteristic missing from this rally."
(Link to original article)
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<< <i>From what I've been reading, inflation is when the money is printed. So, the inflation has already taken place. Changes in price are a consequence. To think it years away is
what the government lackeys are telling us. Since they haven't been truthful to us yet, I tend to disagree. >>
Its a chicken or egg scenerio. I contend that the printing of money occurs to combat inflation. In the present situation, has new money been created---ie is there more money floating around now than 2 years ago? If so, then I'll buy your arguement. I dont believe there is more money today than 2 years ago and coupled with massive excess in the manufacturing side of the economy, the only imbalance I see is deflationary. The bond markets see this also.
Gold has rallied not due to inflation fears, but rather fiat fears.
Commodity cycles last 20 years. The biggest moves always occur at the end of cycles. In 2020---or about 20 years after the commodity cycle started, the baby boomers will be leaving the workforce en masse. This will create a labor shortage which will boost wages. This is when gold will really shine.
Knowledge is the enemy of fear
If the past hold true again, it points to gold being aroung the 1800-2200ish range around 2012... Looking at the Silver Gold Ratio of the past 13 years of 61, silver should be around 29.5 - 36.1 area.
Thoughts?
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Just a reminder of what I posted on Monday:
**********************
Im going to say it again... for the sake of you bulls... if gold breaks below 980 then look out below. 980 is key.
Im hoping that gold finds some support now and quickly gets back above 1000 or you might find some real choppy negativism in the market.
remember what I wrote initially-- the break out from the pennant at 980 calls for a major move up... and if you don't have that major move up when the charts say it should come, when will you have it?
********************
cheers.
www.AlanBestBuys.com
www.VegasBestBuys.com
So what is the % of stocks at all time highs? 5%? 1%? If you use the DOW is it 0%? It's low whatever it is as we are 30% down from the 2007 blow off. It matters little to me what stocks are at 52 week highs just like it mattered in 1931-1933. Whether gold made it to 99.2% of the ATH or 100.1% hardly seems to be a critical factor. Within 2-8 months the concern with gold's ATH will be resolved.
Gold has made all times high in most (not all) other major currencies. The only reason gold vs. the dollar has fallen <1% short of a new all-time high is because we hold the reserve currency and have a much more active FED, Treasury, and PPT behind the dollar. The Europeans, Chinese, and Japanese don't own the reserve currency and don't have to worry about defending it. It doesn't hurt that our leading banks are in on the game plan as well and that central banks have been leasing out thousands of tons of gold to bullion banks to assist. What's the only asset that CB's own that they can dump on the market? What happens when it's effectively all gone? Even with rigged markets they've "successfully" held gold to only a quadruple so far....a 4-bagger. That's a home run. It is currently ticking off time above $900 and $1000/oz...where <30% of the time was spent above those numbers in 2008. Time is often said to be more important than price. Soon, the time will be up...and that price will come.
Gold's turn around in the past 24 hours was pretty swift. While a welcome sight instead of $960 I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November. But it is nice to see the strength over $1000 again. It's feeling a lot more like a new all time high is coming this year.
roadrunner
<< <i>Gold's turn around in the past 24 hours was pretty swift. While a welcome sight instead of $960 I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November. But it is nice to see the strength over $1000 again. It's feeling a lot more like a new all time high is coming this year. >>
With the move above $1008 which appears to be holding, we're in good shape for the up-trend to start, although for now we're still in consolidation mode. It's critical to keep an eye on the S&P... if it breaks out over 1060, watch for gold to move to all time highs.
Todays move was fairly critical, IMO, as it whould establish a close above $1000 for the month and for the quarter.
That's why I didn't expect to see any real strength occuring today as end of month and quarter sheets were cleaned up. An end of month close at $1000? The boyz must be losing their touch.
roadrunner
<< <i>Todays move was fairly critical, IMO, as it whould establish a close above $1000 for the month and for the quarter.
That's why I didn't expect to see any real strength occuring today as end of month and quarter sheets were cleaned up. An end of month close at $1000? The boyz must be losing their touch. >>
Well the day isn't over.
RR - do you know if the closing figure is considered when the stock markets close? 1pm Pacific? Or when the future market closes, about an hour later? It is disappointing to see the S&P getting hit hard the last half hour, it will be interesting to see if this carries over to gold.
Today's multi-humped gold chart with some quick spikes sure is strange looking.
roadrunner
where is the raging gold bull of a few months ago???
Am I now the gold cheerleader here????
www.AlanBestBuys.com
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<< <i>Roadrunner, you surprise me... you wrote: "I still think gold will only make a lower high and eventually move lower into mid-Oct or as late as early November."
where is the raging gold bull of a few months ago???
Am I now the gold cheerleader here???? >>
I think your opinion of RR and probably me is over-simplified. Long term, I would consider myself a bull, and RR probably would too, but only in the long term (multi-year) perspective. This really is a short term trading thread though. Realizing that not everything goes straight up or down, one can still be a bull yet predict or "call for" a decline to occur over the next day/week/month. Regardless of my long term views, I'd still like to play both sides of a pull-back or re-test if I can see it coming. Overall, we're just voicing our interpretations of the charts as they unfold. It's a mistake to introduce personal bias into chart interpretations, and I'd like to think that RR and I do that the best we can.
To all: I'll probably start the October thread tonight with support and resistance levels for Thursday.
If you look back months, all I've said this year (up until this run to $1025) was that we would see gold hit a new all time high by May of 2010. I didn't take any "bearish" heat for those comments. Most everyone else was saying gold was cooked and a new high was years away. With the current action, a run to a new all time high this year is pretty bullish imo considering the potential for another deleveraging event is always out there. With all factors involved I do feel the short term (2-7 weeks) is in favor of a further correction, even if it's just more time rather than price drops. As PC said this thread is about short term trading and trying to catch up and down swings. It's not about being bullish or bearish, but hopefully about being more right than wrong.
I have plenty of skin in this game, so by definition I am a cheerleader. On these threads I'd rather present pros and cons as I run across them rather than just cheering for gold to always go higher, which of course it cannot do. I play mostly in gold stocks and generic gold coins rather than pure bullion, so my daily views are often slanted in that direction.
roadrunner
It was in a trading range for a long time.
I stand by that:
1. it was in a trading range for a long time
2. it broke out
that's clear, precise, and exactly what happened.
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