Days Not to Buy Gold Identified

OPA

I think most of us suspected it.

Numismaster Article

duxbutt

Nice Post OPA, Could this also be in the silver Market? Friday and Monday it hit 17.50 Then Sell off? Just a thought? Thanks Dan

jmski52

"A market free of manipulation with prices rising over time would normally show a greater percentage of strong up days than down days."

Makes sense to me. And this 10-year rising gold market hasn't done that. To me, there is no better proof of manipulation than this breach of logic.

RedTiger

<< <i>"A market free of manipulation with prices rising over time would normally show a greater percentage of strong up days than down days."

Makes sense to me. And this 10-year rising gold market hasn't done that. To me, there is no better proof of manipulation than this breach of logic. >>



Except the basic assertion is not correct. All markets run on greed and fear, and fear kicks in much faster as most traders who trade live money will tell you. Market declines tend to be faster and steeper than ascents, and that is priced into the equation. Another factor is that many markets move on news, and that many news releases occur on the same day, same time every month.

I never argue manipulation because there is no way to know. Personally, I believe almost all markets are manipulated to some extent in the short term. If there is long term manipulation going on, it is likely to manipulate prices higher. Why? Because there is much, much more profit to be made doing that than taking prices lower. A speculator can only make 100% by shorting and it only works once. Manipulating prices higher, can mean many multiples of 100% profit by going long, with the bonus of a new batch of eggs every year.

If the manipulators in gold and silver are like those in other markets, they are driven by profit. If they are motivated by something else, as some posit, that could be true, but that conclusion takes a big leap of faith. Why would someone spend their time and money manipulating something and lose money, when there are many other markets to tend to and make money? That makes zero sense to me, but as always I will not argue the point.

roadrunner

I don't know about Heller's "2%" rule. Gold's one day record in this current bull run for a one day move is about 9% (+$70) followed by a 2nd day at 5% (+$45). So either the PPT was sleeping those 2 days or no such 2% rule exists. There are many exceptions to this 2% rule if one looks at gold over the past couple of years. Gold moving typically in $25 increments between steps is pretty common, esp at the last 6-8 months. That's roughly 2.5%. Larger movements in one day are usually reserved for something more catastrophic than "rountine" trending changes.

Heller also suggests waiting a day or two after a +2% rule to buy one's gold. That's simply common sense or buying on weakness. One should buy when momentum has hit cyclical lows. Sell on strength and buy on weakness.

I would certainly agree that when gold was still under $400/oz its up moves were capped at no more than $9.99/day and typically at $5-7 max. The controls were much tighter back then and for months gold was not allowed a $10 day. It took quite some time before it finally recorded a +$10 day (2.5%). With gold much higher now the % stakes are at +$25/day.

roadrunner