Options
***JANUARY 2012 Gold and Silver Stocks/Options/Futures trading thread***
ProofCollection
Posts: 5,405 ✭✭✭✭✭
Starting off January 2012 with a new thread. Here's the old thread
I renewed my short gold positions on last Thursday night's bounce which looks to me little more than a retracement of yesterdays' decline. I've got $1420-1460 in my sights at which time I think I will take a long term buy and hold position. Stocks continue to do well and probably will for the first week of January, although I expect January to be pretty bloody overall. 1Q I expect there to be a lot of commodity related bargain stocks - the best buying opportunity in a few years. Gold will end the year strong, over 2000.
I'm going to go on record here with a call for 2012 to be an amazing year for oil & energy stocks. I believe 2012 will see $150+ crude.
In the next few weeks/months, and although it hasn't really gone anywhere since breaking above 80, I expect the dollar index to climb to the upper 80's. This fits in with the discussion on Alex Jones Friday. Without going into details, it's a little conspiratorial but it makes sense. Next year we could be looking at an overt dollar devaluation (via bank holiday) to fight deflation (a la Roosevelt) as per Bernanke's 2002 speech. The only conflict with that is the election year so that might not be politically possible until next November, so nothing anytime soon, unless the strong dollar becomes problematic.
Gold Monthly:
Gold Weekly:
Silver Monthly
I renewed my short gold positions on last Thursday night's bounce which looks to me little more than a retracement of yesterdays' decline. I've got $1420-1460 in my sights at which time I think I will take a long term buy and hold position. Stocks continue to do well and probably will for the first week of January, although I expect January to be pretty bloody overall. 1Q I expect there to be a lot of commodity related bargain stocks - the best buying opportunity in a few years. Gold will end the year strong, over 2000.
I'm going to go on record here with a call for 2012 to be an amazing year for oil & energy stocks. I believe 2012 will see $150+ crude.
In the next few weeks/months, and although it hasn't really gone anywhere since breaking above 80, I expect the dollar index to climb to the upper 80's. This fits in with the discussion on Alex Jones Friday. Without going into details, it's a little conspiratorial but it makes sense. Next year we could be looking at an overt dollar devaluation (via bank holiday) to fight deflation (a la Roosevelt) as per Bernanke's 2002 speech. The only conflict with that is the election year so that might not be politically possible until next November, so nothing anytime soon, unless the strong dollar becomes problematic.
Gold Monthly:
Gold Weekly:
Silver Monthly
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Comments
I've liked this guy's work with intermediate and long term BB analysis. He also does some interesting stuff with contracting Fib spirals which anchors his current view of the markets.
I expected much more resistance at the $1600 level that we saw this morning. Nice 3rd day up for the miners. Jobs report coming out Friday but no TBond auctions until next week.
At least that reduces some of the usual headwinds.
roadrunner
Knowledge is the enemy of fear
Sometimes, NEWS trumps even the best Technical Analysis. Absent relevant NEWS, I expect metals (and the dollar relative to other currencies) to trade within ranges that slope upwards more gently than in the past year or two
Liberty: Parent of Science & Industry
<< <i>Gold may try to make one more attempt tomorrow or next to touch the 200dma, then fail. >>
I'd expect some resistance at the 200 dma as well. But I don't think there's enough ill-winds to keep gold from moving above that over the next 2 weeks.
Around the 17th to 19th is when the stock market OE effects will start to hit. And with gold and silver OE the following week, along with a set of 3/10/30 yr
TBond/Note auctions, & FOMC mtg that should force a decent pull back. But I think gold gets another 2 weeks. A bounce off the 200 dma initially and then forging through it.
The end of month OE could easily return it right back to the 200 dma. On Friday is the jobs report and then 2/5/7 yr auctions next Tu-Thursday. But I don't think
those events have enough mojo on their own to do much damage. Even in 2008 when gold broke the 200 dma it still came back above it for a few weeks.
I expect more recovery than stopping at $1631 after gold put in a 20% dip. But $1631/200 dma would be a 38% retrace of the recent decline from $1803. The $1660-$1680
August gap has continued to play a role at key junctures since August. I think gold will head back up there yet again to retest that same breakdown area (ie 50 and 144 dmas).
In that same area is the large consolidation triangle that was broken as well as the 3 month downtrend line. What better way to fool the dumb gold bulls but by breaking
through the 200 dma, and later coming right back to it? Gold has had a magnet for that $1660-$1665 gap area. I think we see it again (50% retrace). If gold only gets back
to $1631 that will leave miners miles short of their 200 dma. During the gold bull the 144 dma has been paid much more attention too as far as bottoms are concerned. That's
currently at $1680 and still rising. From a time standpoint, gold's ABC legs so far went 5 wks, 6 wks, 7 weeks. I can count 5 waves down on the C leg though I'd be the first to
admit we could still be in the 4th leg of that C wave. But based on absolutely horrible gold sentiment last week (lowest in 3 yrs) I think we saw 5 waves down since $1803.
Fwiw when gold rebounded from it's summer/early fall crash in 2008 it performed final bounces of 10% and 27% before bottoming. A 10% bounce from $1522 is $1674. All the
bounces so far since $1803 are only in the 5-6% range....not quite true rebound material.
The dollar and risk off trades are looking vunerable here and I think it heads lower to fill the gap at 78.6. Yesterday's volume on UUP's sharp drop was huge while today's
volume on the bounce back was quite small. UUP still has some more room to fill it's closest lower gap at 22.00. A move to 78.6 should get gold well through the 200 dma.
Yesterday the dollar fell below the 2 month uptrend line from late October. Today's bounce back retested the underside of that trend line. The Aug-Dec trend line still looks intact.
Using this dollar adjusted gold model - gold is still inside the larger triangle - next target $1673
roadrunner
<< <i>Sometimes, NEWS trumps even the best Technical Analysis. >>
Usually news is the trigger for a move that's already in the charts. Sometimes, big news produces no result. Sometimes, news produces the opposite result of what you'd expect. The financial media always comes up with a way to explain it, but the reality is that it's all fairly pre-determined.
1620 is a fairly big level to watch, although I think tonight gold can stretch up to $1624. Gold has had 4 straight up-days with the 5th being up (so far), which is about the limit for consecutive green candles, although certainly gold could put in a few more. Be careful jumping on this train at this point.
The one thing is that gold has started to convince me that the downside could be over as it's had pretty good strength the last few days. But typically this is about the time that I am tempted to get back on the train that is when things start to break down. So I am close to bailing on my short gold positions, but I'm not giving up yet.
Gold "should" put in a zig-zag of sorts on this bounce. A pull back to upper $1500's wouldn't surprise me before another try higher.
Bad news from EU banks yesterday finally hit US markets today. The dollar bounced off the bottom of a 3 week consolidation rectangle
and headed right back to the top over the past 12 hrs. Now the 3rd time poking around the 80.7 to 80.8 area. This 3 wk consolidation sits
right above a nice 2 month bowl that projects to 85+. If 81 finally gets taken out the picture turns around again. Gold should have been
slammed much harder on that quick of a move. Maybe that comes at the Comex today. But gold has been weathering dollar strength and Euro
weakness better as of late.
Quite a few gaps were made on gold and silver's jump this past week or so. Looks like today will be the start of some gap-filling.
roadrunner
Knowledge is the enemy of fear
<< <i>There was the test of the 200dma this morn. >>
Thanks. I didn't even notice that it had occurred as I went right to the dollar chart. Of course that test came after hours where NY could not take advantage of it.
I'd like to see a test of the 200 dma during normal NY hours.
But we didn't expect a real penetration of the 200 dma this soon. Now a pull back to the next plateau region, $1570-$1595 or 38/50% fib of this last +$104 rally.
I still think it makes another run at the 200 dma and breaks higher. Enough bulls weren't pulled back into the market on that last move. BPGDM still a palty 13.8%.
$1600 was nothing special as the banksters gave it up pretty easy. Same comment on the way back through it I guess. But I think something in the $1580's should be
as low as is needed to balance out the symmetry of an IH&S.
Dollar so far a hair short of the previous high of 80.854 (80.853). Sure seems to be having a lot of trouble getting that last thousandth. Looks to me like the dollar put
in 5 legs from yesterday's 79.5 bottom and is running out of legs. But as I type it did get to 80.857....now 80.9. Getting to 81.0 would be much more convincing.
Gold at $1605 now is handling this quite well. It was at $1597 on Tuesday when the 79.5 was last hit. The dollar tacked on nearly 1.5 pts. and gold gained.
Is gold becoming "risk off" again? Volume on UUP's strong gap up this morning seems rather small so far. Not really confirming the move. While gold could dip further
to make a more symmtric H&S, silver's dip today gives plenty of symmetry to its left shoulder of several weeks back. So maybe gold doesn't have to go further than $1597.
roadrunner
be as far away as I thought.
Fwiw gold bottomed against UDN last Thursday. So for now the Euro is basically moving opposite to gold. A rising dollar doesn't have the same mojo vs. gold
as it did the past 4 months.
roadrunner
Although tonight, gold may try to lead us astray with a push up to the next resistance level at 1633. I think I'll add to short positions there.
I hope you did. Nice 1.5% drop off the highs. You've been pretty good with your trading recently!!
Bollinger bands tightening on US treasury yields. Should see a spike higher or lower very soon.
Knowledge is the enemy of fear
<< <i>Today Nichols made a very compelling case for a swift decline in gold to start Friday or Monday, and I'm going to be on the watch for it, I think it's going to happen. A lot of other indicators for me point to a VERY bloody January for stocks, and I think gold will go along with. Some timing cycles point to Mon/Fri as the start of a new cycle, and the short term charts are ready for a new trend. With 5 consecutive green candles, I just don't see how gold will keep ascending in the short term.
Although tonight, gold may try to lead us astray with a push up to the next resistance level at 1633. I think I'll add to short positions there. >>
While gold has meandered up the past 5-6 days most of that was done in the first 2-3 days. Silver and miners went up for 3 days and have been moving sideways to down on
lowering volume. They look to be consolidating. One would expect a least one more modest move up out of silver and miners. I'd say gold has done a very slowly rising
consolidation as the strongest of this group. Commods and equities have been in a 10-12 day rise. So the PMs have been late to this rebound because of their final smacking
the week after Christmas. But if commods want to go deeper to fill some newly made gaps, it's going to make it much tougher on the battered metals. This morning's bounce
to $1631+ did meet the 38% retrace of the decline from $1803 and during NY market time. Those 2 short term checks are complete. The 4 hr chart does have that "rolling over"
look to it. SLV, GLD, and miners are currently dancing around the 20 dma lines that they haven't seen for over 3 weeks.
The dollar has hit the neckline from Dec 2010 and could be time to add a handle to that 1 yr cup. Gold has also gained against a 1.8 pt rise in the dollar which is sort of incredible in this
anti-Euro environment. Guess I see those as signs of non-bearishness for gold. The EURO also looks like it's 10 wks along in this current C wave. The A wave down lasted 11 wks.
On top of that commercials are still 9-1 short the dollar and quite long the Euro. Dollar is now near the end of 4 month rising wedge. SM is now back up above the 200 dma and
broken above the 6 month downtrend line. Wall of worry continues to be climbed. Today's dollar and gold action was pretty contrived around the 8:30 am jobs report (+200K, 8.5%).
They swung both multiple times. Just ignore everthing from 7 am to noon today as things settle back out. 3 pops down to the Euro over 3 days. Is that it for now? In any case there
seems to be enough room for both bullish and bearish views for the current situation. Since it seems everyone is looking for a drop in equities, I figure they'll only go higher. Ditto for
gold, silver, and miners....at least until the 19th where OE forces start to converge and then build into the 26th. If there's another big drop in PMs coming then late January to early Feb
would be an appropriate time.
<< <i>Today Nichols made a very compelling case for a swift decline in gold to start Friday or Monday, and I'm going to be on the watch for it, I think it's going to happen. A lot of other indicators for me point to a VERY bloody January for stocks, and I think gold will go along with. Some timing cycles point to Mon/Fri as the start of a new cycle, and the short term charts are ready for a new trend. With 5 consecutive green candles, I just don't see how gold will keep ascending in the short term.
Although tonight, gold may try to lead us astray with a push up to the next resistance level at 1633. I think I'll add to short positions there. >>
I'm looking for near term declines, especially equities - part of the setup to justify more QE. Unfortunately, PMs are an innocent bystander in the drive-by.
Give Me Liberty or Give Me Debt
It's not politically correct any more to do that. So behind the scenes the pumping of liquidity will continue. If old Ben could pump $7 TRILL
into the market during the 2008 crisis w/o anyone being wiser, they can certainly pump a few well-disguised TRILL right now. If a formal
$600 BILL "program" is the cue for everyone to start spending again then maybe that's what it takes. But it will be a drop in the bucket to
what is going on behind the scenes.
In the continuing theme of there is no inflation, it's all in my head, today I got to pay $4.99/lb for the Granola I've been buying for the past 3 yrs.
It started out at $3.29 when I first started. And sometime in 2010 it went up to $3.89. Then in 2011 there were jumps to $4.39 and then
this week to $4.99. Yup, no "flation" here. Just in the last year a >28% increase. Don't these guys know that grains and food had a "bad"
year in 2011 and declined in price! Guess it's finally time to make the shift to raw oats and groats at $75c to $1.50/lb. I ain't paying $5.00/lb for
this stuff any more. And the CPI will dutifully record this forced "substitution effect" as a 70-85% reduction in my cost of living. No inflation here.
I basially got rid of beef a year or so ago. It was one of the things that climbed in price throughout most of 2011. But since I didn't substitute dog
food or anything else for it I don't think they were able to claim the substitution effect.
Give Me Liberty or Give Me Debt
But the QE continues... Did you miss the $638B bailout for Europe over Xmas? I'm pretty sure those were new dollars.
The Federal Reserve's Covert Bailout of Europe
Federal Reserve May Try Third Stimulus If Economy Worsens, Experts Say
The prices are WAY OUT OF WHACK right now and the 5000's are TOO RICH relative to the others or conversely, the others are WAY TOO CHEAP relative to the 5000's.
1:5 ratio on the 4000/5000's yields approx $150 net credit and still protects you (and even positions you for further closing credits) against an upside move of 1000 or more.
Knowledge is the enemy of fear
2008-2010 neckline. A number of other commodities including PMs, grains and softs and a similar long term formation. While copper could
play the short term bearish card, I think it will do ok in 2012 along with the general commodity complex.
Nice to see gold playing from the other side of the 200 dma for now. Silver broke out of a 3 week H&S and fighting hard at the key $30 level.
Head and shoulders projects to around $33 which would is better than a stick in the eye. Bearish PM forces will start to line up heavily starting mid-next
week. Tbond auctions this week so far appear to be a non-player. Cocoa (NIB) >3 yr consolidation, double bottom after ABC, now breaking out?
Knowledge is the enemy of fear
Gold is only testing the breakdown from the Nov low. The 50dma is about to trade beneath the 150dma. Maybe get another $25 pop, but downside risk appears greater than upside at this time.
Moving averages on GDX are all trending lower. At best, we see sideways trading in the group.
Knowledge is the enemy of fear
There are a number of PM/miner gaps sitting down lower to possibly contend with. Gold and silver have been moving higher since $1630 but not taking all the miners with them. FCX seemed to lose it's mojo from yesterday as well. At least from what I see in the miners, today looks like a good candidate for topping action. And all those lower gaps were starting to cause a lot of concern. Miners often don't care that that the price of gold or silver is going up. Maybe they can squeak out a bit more gains by Friday or Tuesday as I was hoping GDX would try to fill its higher gap at just under 57. But risk is rising. With Monday a holiday that gives the banksters and extra time to play some overnight games. SLV still showing a nice breakout from the IH&S projecting to $32+, assuming it all follows through. Stocks still breaking out incl China but I think we get a whiff of correction next week as risk-off returns. Closed out my NUGT positions around 24 today. Was hoping to take them to 26-27 but today's miner vs. PM action was divergent. I'm going to wait and see what "gifts" next Thurs-Friday brings in the miners. Sitting it out until then as I agree with Cohodk that risk > reward for now.
roadrunner
Alf has called the gold bottom in based on his EW and % decline analysis. He feels we're on the way up in wave 3 of the gold bull with a target of $4500.
Of course having this stuff come out today is interesting as I think the short term up move in gold is done. A lot of people will be buying the silver $30 breakout"
and the gold "$1650 breakout." Don't underestimate the resistance offered by the $1660-$1690 gap up ragion...and then the $1702 swing point. Euro has that
double look that just might help gold along. But miners probably won't move up with gold unless S&P bumps up another 100-200 pts as well.
Alf has some interesting comments on derivatives. I wasn't aware that there are MORE otc EU interest rate contracts than there are dollar ones. The EU % of
BIS reported otc IRC's in 57%...same basic % it makes up in the USDX. Don't know if that's coincidence or by design. ???
Anyone have an input on Baltic Dry Index falling off a cliff and halving in the past 3 months? Still in a steep dive the past 2 wks with no end in sight. At least the shippers aren't
quite following that scenario. Trying to correlate commod or SPY price movements with BDI seems fruitless. The BDI often keeps going down or going up in oppostion to
the SPY. At times it seems leading and other times lagging. But certainly a BDI headed towards 2008 lows isn't good.
roadrunner
Knowledge is the enemy of fear
trading paper gold for fear of not getting all their money back from the brokerage.
I''m not familiar with the Force signal this analyst uses but even during the July-August 2011 breakout, gold volumes were not all that impressive either. And that was the
beginning of the best gold rally seen yet. Gold likes to pull away in stealth mode...if that is what it's currently doing. But I agree with the writer that let's see what happens
in that $1675-$1700 resistance zone before getting too excited. Gold seems to be more reliable when using chart formations or even support/resistance lines. It has fooled
me many times on contrarian looking indicators and oscillators.
This week Kinross pulled a Hecla. Besides lowering projections for 2012 & delaying their 3 mining projects, Kinross said they would be writing off some of the good will on their
recently acquired Tasiast mine (via Red Back takeover in 2010). The mine carries a whopping $4.6 BILL good will value. KGC fell 19% today. If it writes off ALL the GW it would be
-32% of the company's market cap. The Tasiast mine is located in "Al Queda country" and there are rumors the mine might have resistance in getting permitted/built, etc. The gist
here is that the locals will only become bigger problems in getting new mines built in riskier jurisdictions. Don't count on miners bringing more gold to market. We should be happy
if they remain flat. Bullion in the hand is looking better every day. Whoever would think that "good will" makes up 2/3 the value of a gold mine? Miners continue to have a tough
road to hoe in their "good will hunting." Newmont today also lowered 2012 production but that was pretty much put out months ago. Still, this news repeat caused them to be
hammered. Some word came out of the Mexican govt today that they are giving away the farm to Canadian mining companies and that royalties need to be looked at. The trend will
continue around the world.
wonder if the lower volumes in gold over the past few months tie in to MFGlobal. No doubt some people are no longer trading paper gold
So as I have contended, the paper market moves the physical, as physical prices have suffered. If the paper market goes away, physical prices could collapse. But I believe the paper market will not disappear.
during the July-August 2011 breakout, gold volumes were not all that impressive either. And that was the beginning of the best gold rally seen yet
Prices can certainly move without volume--in both directions. The lack of volume (which I dont see on the GLD chart which shows heavy volume) could be the reason why prices were not sustainable at 1900. As usually happens, the best cure for high prices is high prices.
I think the analysis backs up my contention that prices will trade sideways as both bulls and bears struggle. The trading range could be quite wide though and profitable for traders while frustrating for investors.
Knowledge is the enemy of fear
<< <i>
I think the analysis backs up my contention that prices will trade sideways as both bulls and bears struggle. The trading range could be quite wide though and profitable for traders while frustrating for investors. >>
Check the Weekly and Monthly for both Gold and Silver
I think the volumes on futures may be low simply because this market has become difficult to trade. I've seen a lot of articles that traders are waiting for clues, waiting for direction. I don't think it has a lot to do with MF Global. It may have something to do with the new exchange in China. If you believe in the manipulation theories, then you would also have to believe that the new Chinese exchange will (or should theoretically) end (or diminish) blatant manipulation by "the big boys."
I'm not sure how paper gold would "go away," but regarding paper driving physical prices, there may be some truth but I don't think physical prices will collapse... the supply chains are fairly tight and no one is eager to sell physical gold... not until the economic picture clears up in Europe and here.
My $.02.
After reviewing many more charts besides the futures contracts, ie xau, slv, gld, and others,
I can see where a 10 month (sideways- somewhat biased to the upside) process may take place.
<< <i>Silver on fire today. Anyone know why? >>
Take a close look at the Weekly and Monthly Silver charts utilizing, macd, histogram, wialliams%r, and 3yr sma
<< <i>Silver on fire today. Anyone know why? >>
During silver's last major run Sprott was looking for 22 MILL ounces. He is now looking for 10 MILL ounces to add to PSLV. While that amount is
technically nothing compared to the world's supply of both paper and physical silver, it certainly seemed to help during fall 2011. COT commercial positions in
silver at 5-7 yr extremes. Seems logical it has to shift the other way at some point. Dollar weakness certainly helping it along. And the comm. dollar futures
short to long ratio is still at the 9-1 nose bleed level. Been there now since the December 13th report. Silver has put in an 8-1/2 month correction since the early
May top. That's similar to the 7+ month 2008 correction.
Closed right at resistance. Monday could be moving day. MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
The odds strongly favor PM weakness by Wed/Thurs. This week also has some nice Fibonacci dates from Mon-Thursday. A broadening top pattern in gold
the past few days only the volume has been rising with each peak which is atypical. Could end up being a bullish rising wedge. 3-4 weeks w/o a good gold
smackdown?....looks like it's time and this week sets up perfectly with the dollar having completed 5 legs down over the past 6 trading days.
TIPs Bond Fund and Gold have been rhyming somewhat over the past 2 months, at least as far as turns. While TIPs have turned sharply down the last
4 days gold has held up. If the old trend holds, Gold will follow the TIPs down later this week. TIPs have just fallen below the 50 dma for the first time since
October with a nice fat gap sitting lower at 115. Still bullish on gold though once we get out of this OE week intact. GLD just jumped above its 50 dma and is
now filling the gap that goes all the way to 166 ($1704). It may not get it all on this move but it's working on it. GLD is now right up against the downtrend
line as well. Plat and Pall doing pretty good today. Nice gap up in nat gas...finally. The dollar's down move of the last 6 days made a nice 6 pt channel. After
a bounce a likely place to go is lower to fill some older gaps and make more symmetrical cup/handles of long term patterns. Right now the dollar is retesting
the neckline of the Oct/Nov cup. But the year long 2011 cup seems to need a deeper right shoulder. That would give it a chance to fill the gap at 78.6. GDXJ
needs to improve on that tall, gapped up, gravestone doji that has formed today or it's suggesting excitement to come on Tuesday-Friday (gaps at 24/25). The
30 and 20 day BB's crossed while the body of GDXJ candle pulled back to inside the 10 day BB. GDX Aroon (10) suggesting several more days of weakness. But
the fact that GDX filled its lower gap last week would say otherwise. All the recent bad news from NEM, KGC, BVN, etc. has slowed GDX.
I would guess that even if gold and silver pull back a bit this week, the miners will only pull back far enough to retest bottoms and fill remaining gaps.
The sentiment is still to low to expect another round of sharply lower lows. But I'm still waiting until Wed/Thur/Friday to buy hoping that things get cheaper.
On today's spike up I unloaded my NUGT position from last week. I'd like to pick up some GDXJ on the next pull back but it's gone so far already that I'd be
more comfortable with it at 24. Miner news of the day is PAAS's $1.5 BILL buyout of silver miner Minefinders (MFN).
If GSR has truly broken the 8-1/2 month uptrend (leg 4) it would be nearly identical in time to leg 2 back in 2009-2010. The 1st and 3rd legs down lasted about a year each.
Leg 5 now in progress?
roadrunner
MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
<< <i>a very interesting chart. MJ
MJ >>
This one is more representative.
10 yr Treasury yield
Knowledge is the enemy of fear
today I felt a lot better about my chicken NUGTs. A 24.5% move from today's bottom. I sold 1/4 of the position at the very peak (23.72) today for 18%.
I was watching the action at 12:30 and figured the bounce to $1667 after a morning low was just the usual FED announcement head fake back into the capped
resistance zone. But this time it was the real deal. I should have loaded the boat at the $19.05 NUGT low this morning. In hindsight OE week seemed to have ended at
10 am this morning with a a final whack to $1649 as London closed. GDX completed a nice 5 waves down over 8 days at that point with neg divergence on the
hourly chart. It was a decent setup except for it being within 24 hrs of OE which gave me some concern. GLD filled its gap at 166.16 today leaving no real higher
gaps to shoot for, just 3 lower ones down to around 151 (range of approx $1550-$1620 gold). Wild day in the mining sector. It hasn't really gone anywhere in 6
months or longer....just up and down half a dozen times.
Since I don't know, I'm asking the expert(s).
It seems to me, upon reflection - that Operation Twist produced both those charts - the 10yr vs. the 20 yr.
How many times can it be twisted?
I knew it would happen.
<< <i>That 10-yr Treasury chart is counterintuitive. Now that Bernanke has signaled rates lower through 2014, is demand picking up for 10-yrs? Or will that trendline drop off now?
Since I don't know, I'm asking the expert(s).
It seems to me, upon reflection - that Operation Twist produced both those charts - the 10yr vs. the 20 yr.
How many times can it be twisted? >>
If you have not read Hoisington Managements latest its worth a read, they have been dead on in this arena for years, quarter after quarter.
Today was just another confirmation of their analysis.
The OE week pullback ended at 10 am today as London closed and got gold down to $1649 to suggest a much deeper dive to come within 24 hrs. It didn't. Gold ran right back to the $1655 and then the lower $1660's. The reason for today's move really didn't matter as any event would have pushed it over the edge before the end of the week. It just happened to be associated with the FED rate decision. It could have just as easily been a missile from Iran or a report that China now has 3000 tons of gold in inventory. Gold broke out of the $1660-$1667 range earlier this week and headed back one last time to retest $1650-$1667. Once clear of that today and above $1682, it was off to the races as GLD entered the gap down zone from Sept (164-166). Hard part was putting all that together before it happened. It's always easy in hindsight. But a number of chartists were picking up on all those clues.
I still say that the rate curve is largely influenced by the $275 TRILL in otc interest rate contracts carried by the top 5 US banks. Even Pimco's assets can't stack up against that.
Sinclair and Kirby have been saying this for quite some time. The market can try to determine interest rates but just when they think they do, the banks add another $50 TRILL
to the pile. You can bet all day that #36 won't come up on the roulette wheel. But if the 5 banks have $275 TRILL bet on #36....it's coming up each and every time. Essentially,
they are doubling down their winnings on every bet. Eventually #2 will come up....but it will take a lot more ammo or regulatory change to make that happen. Pimco was betting
in 2011 that #36 wasn't come up again and again....but it did....thanks to an extra $100 TRILL in 50-1 leveraged bets that it would (anchored with real TBonds).
<< <i>a very interesting chart. MJ
MJ >>
$19.00 today would have been a perfect entry for a DT/ST
MJ
Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
The various huge miner and bullion vs. SPY volume ratio spikes this mornings pulled back quite a bit. At this point I'd say it suggested today was a short term blow off, even if a retracement only lasts hours, a day or a few days. I don't like hanging around in miner ETF's when these kinds of spike days occur after a few weeks of rallying so off went the other 3/4 of my position this morning. Knowing there was at least a $1 gap formed today helped in that decision. Looking at the Rangold chart which has often been the strongest larger gold miner on rallies, it's upward movements all appear to be 3 waves rather than 5 waves. And it still has that annoying fat gap sitting lower. I retain some healthy skepticism. Miners now slowly pulling back into today's gap-up zone in sympathy with the SM giving up all its gains today. The AUY chart is impressive with yesterday's huge candle, followed by another one this morning, and now has morphed into a giant gravestone doji. Definitely some profit taking occurred here. +17% on a senior gold miner in 2 days is a tad unsustainable imo.
Today BPGDM RSI (14) exceeded 70 while W%R is maxed out. Usually GDX will rally for about 2 weeks once these both max out. BPGDM now at 34 and well above the 5 dma. Even with a brief pull back here these should remain in bullish alignment.
roadrunner
While Connor has been shifting his calls willy nilly the past few months he does seem to do very well on the dollar. Now calling for a
possible breakdown due to a violation of the Dec 21 low. He still expects a bounce here shortly on the daily cycle. But if that fails to
make new highs expect the intermediate cycle to head below that Dec 21 swing low. The late August $1702 low in gold forecasted much
the same thing for gold once it broke down. And even from there gold bounced to a new all time high...and then got creamed even after a new high.
Reminder to Cohodk to show us something on 10 yr Treasury yields.
roadrunner
Here is a chart of the 10yr Treasury yield. I do not think it will be contained within the blue trendlines for much longer. But which line gets broken. Will we be looking at a 2.50% or 1.5% yield? The direction will have a major impact on the price of gold, equities and currencies. And I do not believe the move will be passive.
Knowledge is the enemy of fear
I'd like a clue on, historically, the range this index has it spent the most time in the past? And how the connect-the-extremes lines slope over the longer time frame
have such lines been predictive in the past?
which is more likely, that intermediate term rates approach zero, or double from here?
thanks
Liberty: Parent of Science & Industry
Looks like a pretty well defined downtrend channel since the early 90's of which we are currently at the lower end. My momos are hinting at possible higher yields, but market action since the FED announcement has been bearish for yield. IE, money pouring into bonds pushing down yield.
Knowledge is the enemy of fear
Give Me Liberty or Give Me Debt
<< <i>
<< <i>a very interesting chart. MJ
MJ >>
$19.00 today would have been a perfect entry for a DT/ST
MJ >>
$18.34 today. They cant enough Treasuries.
Knowledge is the enemy of fear