***MARCH 2012 Gold and Silver Stocks/Options/Futures trading thread***
roadrunner
Posts: 28,303 ✭✭✭✭✭
This is a continuation of the February thread.
The ISDA came out today and declared that the Greek credit haircut was not a default....just like JS said it would be. Those owning CDS protection might as well burn them.
Wonder if a 99% debt haircut would be ruled on "non-credit default" event as well? Otc interest rate contracts/derivs will still rule the roost when it comes to the interest rate curve.
This is a case of what you can't see can definitely hurt. Bill Gross (and clients) learned that hard lesson last year. Maybe he forgot to pay his dues to the ISDA and was left out of
the loop?
Yesterday's huge dip came on the heels of a 31 tonne gold sell order (ie 1 MILL oz or 1,000 contracts) from a foreign fund that wasn't interested in maximizing price, just the effect.
Could some of that been part of the missing 144 tons of Libyan gold? At the peak of trading yesterday over 20,000 silver contracts traded hands in 30 minutes. The fact that only
silver and gold felt the brunt of the hit yesterday sort of hints that a laser guided "smart" bomb was used with a timer set for 10 am. And the move in the dollar yesterday was only
25% of the move that first took gold from 1705 to 1790. Silver was given a final boost to an intermediate high of $37.50 just minutes before 10 am to draw in as many sheep as
possible. The move down yesterday appeared to be in an impulsive 5 waves, suggesting that after a B wave bounce, we see a final C leg down. It may not even dip as low as
the $1687 seen yesterday but the next GLD gap lower at $1620-$1625 is certainly a target as gold attempts to backtest the 4 month downtrend line breakout. 3rd week in March
could be a convenient time for a final dip. If gold does dip lower a 50% retrace to $1650-$1670 makes more sense to me or even a final rehash of the $1702-$1708 area that has been
hit a number of times the past 7 months.....though $1625 would be the 62% level. That $1660-$1690 break out level from last August continues to have significance as it was briefly
touched yesterday. $1660-$1664 was where the real action has taken place though.
Still trying to figure out how $BPGDM on stockcharts went higher yesterday as miners got creamed. One would expect it to have remained the same or gone lower. The only 2 US
exchanged listed miners that had up days made no changes with respect to being above/below their 50 dmas. ????
The ISDA came out today and declared that the Greek credit haircut was not a default....just like JS said it would be. Those owning CDS protection might as well burn them.
Wonder if a 99% debt haircut would be ruled on "non-credit default" event as well? Otc interest rate contracts/derivs will still rule the roost when it comes to the interest rate curve.
This is a case of what you can't see can definitely hurt. Bill Gross (and clients) learned that hard lesson last year. Maybe he forgot to pay his dues to the ISDA and was left out of
the loop?
Yesterday's huge dip came on the heels of a 31 tonne gold sell order (ie 1 MILL oz or 1,000 contracts) from a foreign fund that wasn't interested in maximizing price, just the effect.
Could some of that been part of the missing 144 tons of Libyan gold? At the peak of trading yesterday over 20,000 silver contracts traded hands in 30 minutes. The fact that only
silver and gold felt the brunt of the hit yesterday sort of hints that a laser guided "smart" bomb was used with a timer set for 10 am. And the move in the dollar yesterday was only
25% of the move that first took gold from 1705 to 1790. Silver was given a final boost to an intermediate high of $37.50 just minutes before 10 am to draw in as many sheep as
possible. The move down yesterday appeared to be in an impulsive 5 waves, suggesting that after a B wave bounce, we see a final C leg down. It may not even dip as low as
the $1687 seen yesterday but the next GLD gap lower at $1620-$1625 is certainly a target as gold attempts to backtest the 4 month downtrend line breakout. 3rd week in March
could be a convenient time for a final dip. If gold does dip lower a 50% retrace to $1650-$1670 makes more sense to me or even a final rehash of the $1702-$1708 area that has been
hit a number of times the past 7 months.....though $1625 would be the 62% level. That $1660-$1690 break out level from last August continues to have significance as it was briefly
touched yesterday. $1660-$1664 was where the real action has taken place though.
Still trying to figure out how $BPGDM on stockcharts went higher yesterday as miners got creamed. One would expect it to have remained the same or gone lower. The only 2 US
exchanged listed miners that had up days made no changes with respect to being above/below their 50 dmas. ????
0
Comments
Was it a 30% haircut, then? How long before some enterprising entity issues a derivative bet on now much of a haircut ISDA will give Spanish, or Portuguese bondholders? So much smoke out there. It's a wonder that any work gets done at all in this world.
I knew it would happen.
The work is getting done by folks who mind their business and don't over-concern themselves with 24-hour news reports of all the cares and worries of the whole wide world.
Liberty: Parent of Science & Industry
I knew it would happen.
<< <i>Baley, I'm working and keeping track of the news as we speak. >>
not everyone is able to multi-task.
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Anyway, gold and silver continue to churn in a trading range.
Liberty: Parent of Science & Industry
Our own Barry Stuppler was 1-2 days early in his call to go all-in. Oops.
<< <i>Time to go all in with gold and silver
Our own Barry Stuppler was 1-2 days early in his call to go all-in. Oops. >>
at least he said a 10% pullback has a 5% chance of happening
<< <i>
<< <i>Time to go all in with gold and silver
Our own Barry Stuppler was 1-2 days early in his call to go all-in. Oops. >>
at least he said a 10% pullback has a 5% chance of happening
And so far he is technically correct since we didn't see $1600 and gold only fell 6%. Had he said "$1600's" that would be different. But it is sort of interesting to check back
a few days to see which bulls were calling for new highs just as the guillotine was ready to drop.
<< <i>
<< <i>
<< <i>Time to go all in with gold and silver
Our own Barry Stuppler was 1-2 days early in his call to go all-in. Oops. >>
at least he said a 10% pullback has a 5% chance of happening
And so far he is technically correct since we didn't see $1600 and gold only fell 6%. Had he said "$1600's" that would be different. But it is sort of interesting to check back
a few days to see which bulls were calling for new highs just as the guillotine was ready to drop. >>
As far as I can tell they all were/are, but one day doesn't make a market and most of the charts are still in relatively good shape, daily weekly and monthly. Now if your an hourly or minute man then yesterday was a significant move and made your charts look rather sickly.
How 'bout that move in interest rates?
Very nice rising wedge in the DOW over the last 6 weeks on the 10min chart. Resolution will occur within days. DOW has been trading in a 150pt range centered around 13000 for the last 9 trading days. I dont think it make 11.
Knowledge is the enemy of fear
<< <i>I did damage control on my long GLD position and moved from net long to slightly delta negative, and from slightly theta negative to slightly theta positive. >>
Ok. I never really delved into the put and calls except for selling some covered calls some years ago, so that language is a little over the top for me.
Does it mean you are basicaly net neutral?
<< <i>I did damage control on my long GLD position and moved from net long to slightly delta negative, and from slightly theta negative to slightly theta positive. >>
Ok. I never really delved into the put and calls except for selling some covered calls some years ago, so that language is a little over the top for me.
Does it mean you are basicaly net neutral?
<< <i>
<< <i>I did damage control on my long GLD position and moved from net long to slightly delta negative, and from slightly theta negative to slightly theta positive. >>
Ok. I never really delved into the put and calls except for selling some covered calls some years ago, so that language is a little over the top for me.
Does it mean you are basicaly net neutral? >>
At the moment, my GLD position nets out to ever so slightly short (delta negative). Positive theta means I benefit from time decay. Before the latest adjustment I was negative theta, and time decay worked against me each day of no movement.
wouldn't that be remarkable if it did? and kept within that range even longer? But you're probably right, it's earnings season. Things are gonna change, I'll guess on a breakout to the upside this time.
Liberty: Parent of Science & Industry
with the bottom trend line support going back to September. Big move coming one way or the other. $1702 Sept swing low continues to offer support since the
bounce back from $1687. $1702 has been a key support and resistance level for 6 months.
After adding 19,000 short gold contracts last week, the commercials added 16,000 this week for a massive 35,000 in just 2 weeks. As usual, they conducted their hit on
Wednesday so that the Wed footprints won't be visible until next Friday.
Mining "cash" costs are generally misunderstood. So when I saw this today from Adam Hamilton of Zeal, I thought it would be helpful.
Under this standard, total cash costs are calculated by adding cash operating costs (direct mining expenses, stripping and mine-development adjustments, third-party smelting/refining/transportation costs, and credits from byproduct sales if applicable) to royalties and production taxes. And the per-ounce figure we see is calculated via dividing total cash costs by the total ounces of gold produced.
What these costs don't include are non-cash expenses such as depreciation, depletion, and amortization, along with reclamation and mine-closure costs. They also don't include the "effective cost" of replacing the reserves that are being mined. The miners are constantly in search of their next deposit, and it takes a big capital effort to do so.
While I dont want to discuss the dollar, I will note that the Cando has been especially strong and the YEN especially weak. These may be your trades going forward.
Getting a chance at another trade yields. Bollinger band width historical lows. Im of the belief that yields could be as much as 50 basis point different a month from now than today. But higher or lower? Implications could be quite dramatic for both equities and PMs.
Knowledge is the enemy of fear
Knowledge is the enemy of fear
We need to hold 32.40 or we may be looking at 27.50
The weekly and the monthly show this area needs to hold. The daily has already been violated, but it is not as critical as the weekly and monthly.
Knowledge is the enemy of fear
GLD gap is down around $1620....then $1588....then $1550. There was enough extended buying last time around at just under and around $1600
that I don't think it gets taken out. But $1620-$1630 is certainly a fair target (10% pullback from the $1791 and a 62% fib retrace on this last leg).
$1650 is about the 50% retrace. Currently at 44%. In any case, it seems most have usually overestimated the depths of future highs and lows.
Just look back to $1522 /$26 as everyone was figuring on $1450/$22 and lower. Will probably work out the same this time around. Just human nature.
Nice rebound on the miners here into the close w/o the S&P leading the bounce. Though not a whole lot of volume behind it.
Silver respected the bottom of its wedge and bounced today. Gold has since backtested the bottom of that wedge then closed back above it by afternoon.
<< <i>GLD needs to get back above 164. >>
Smacked its head against 164 twice today.
Knowledge is the enemy of fear
<< <i>
<< <i>GLD needs to get back above 164. >>
Smacked its head against 164 twice today. >>
Do you find it a little more difficult to annalize a gold or any fund that trades as a stock rather than the actual underlying commodity?
<< <i>Do you find it a little more difficult to annalize a gold or any fund that trades as a stock rather than the actual underlying commodity? >>
Personally, it seems to vary. I'll look at Gold, Silver, GLD, SLV, SIL, GDX, HUI, GDXJ, and CDNX to see how they are all tracking. Sometimes, one or two of these gives
more clear signals than the others. One might be already up against support or completed a major Elliot Wave or TA pattern before the others. Their volumes
are often slightly different as well. Gold futures might provide diff volume data than say GLD shares. The more that line up together the better. I'm not as sophisticated at
looking at many variables as Cohodk is, but there are certainly clues. It's probably just as important to also analyze various currencies, bonds, stock market, base metals,
major economic news, etc. to form a complete picture when analyzing gold or a gold ETF. In the end it still comes down to buy it cheap and sell it high.
<< <i>
<< <i>Do you find it a little more difficult to annalize a gold or any fund that trades as a stock rather than the actual underlying commodity? >>
Personally, it seems to vary. I'll look at Gold, Silver, GLD, SLV, SIL, GDX, HUI, GDXJ, and CDNX to see how they are all tracking. Sometimes, one or two of these gives
more clear signals than the others. One might be already up against support or completed a major Elliot Wave or TA pattern before the others. Their volumes
are often slightly different as well. Gold futures might provide diff volume data than say GLD shares. The more that line up together the better. I'm not as sophisticated at
looking at many variables as Cohodk is, but there are certainly clues. It's probably just as important to also analyze various currencies, bonds, stock market, base metals,
major economic news, etc. to form a complete picture when analyzing gold or a gold ETF. In the end it still comes down to buy it cheap and sell it high. >>
RR, your'e idea of looking at the varying gold etf's and other related indexes is good and I use it, but the problem I run in to at times is the confussion of signals it can give therefor I don't act one way or the other when I should have. The verification is good when it is there, but when its 75% here and looks 100% there and again 50% here it gets a little disconcerting. And an unsure trade has almost always resulted in poor results for me. Your last sentence is brilliantly simple and absolutely true.
<< <i>
<< <i>GLD needs to get back above 164. >>
Smacked its head against 164 twice today. >>
Cohodk, Try a 35 ema, 175 ema and 350 ema on your daily GLD sharpcharts, and let me know what you think.
They are multiples of 7 and 5. 5x7=35, 35x5=175, 35x10=350 or 175x2=350. beginning at 35 which equates to 7 weeks, 175=35 weeks and 350=70 weeks. Gold appears to hold to this time/price frame on the daily, at least the past three years and thats all I have access to on sharpcharts. I utilize primarily barcharts.com.
Gold futures got a bit of good news, as the Fed sent out feelers about a new, "sterilized" quantitative easing which would inject capital with restrictions. The restrictions would make it difficult for the new cash to get into the speculative markets, but the possible Fed action is negative for the greenback. If the Fed continues to send out these feelers, it suggests that QE3 may be a reality after all, which could be viewed as bullish for Gold. Technically, the market was unable to confirm a downside breakout, but Gold remains vulnerable. In the near-term, prices have to cross 1715.00 to capture some momentum. Some traders may want to continue to watch the 1680 level on the downside and then perhaps consider entering into a short position on consecutive closes below this level.
I would like to see 1720 rather than 1715 though.
Full moon today. Tomorrow is monthly NFP report. Have to think that with stocks OE about a week away that this next period will be used for a another leg down in miners, stocks, etc. But the banksters have been moving further away from canned scenarios that used to work so well. At times they start days or even a week sooner to get surprise on their side. The $1702 swing low continues to be a critical point. I think a fight will continue to be put up there before a final bottom is put in. My gut feel says no worse than the $1620 area to fill the next lower GLD gap.
<< <i>
<< <i>
<< <i>GLD needs to get back above 164. >>
Smacked its head against 164 twice today. >>
Cohodk, Try a 35 ema, 175 ema and 350 ema on your daily GLD sharpcharts, and let me know what you think.
They are multiples of 7 and 5. 5x7=35, 35x5=175, 35x10=350 or 175x2=350. beginning at 35 which equates to 7 weeks, 175=35 weeks and 350=70 weeks. Gold appears to hold to this time/price frame on the daily, at least the past three years and thats all I have access to on sharpcharts. I utilize primarily barcharts.com. >>
I use 50, 150 and 200 as these are pretty much industry standards. When trading it is best to look at the same as everyone else because if you understand how traders react you will be able to gain a slight advantage. If no one else is looking at the same as you, you may put yourself on an island all by yourself.
I agree with PC, the next move could be up, down, or sideways. Overall, I think gold is still going to be in this big range (1500-2000) for the forseeable future.
Knowledge is the enemy of fear
We have also crossed over the 72 ema on the hourly to the upside finally, but we need to hold that progress.
TIPs have basically mirrored gold's movements the past few months and shows a somewhat decent looking flag pole-like formation. Could be nothing. Tips have sometimes been a good check on gold's intended movements.
If one tosses out the highest 6 days of gold's movements in late February, we've basically seen a descending 6 point channel correction since Feb 2nd. That would also line up with what GDX/GDXJ have done since then. Yesterday's jump to $1707 hit the top of this channel for point #7. The bottom of the channel hits $1640-$1650 over the next week or two should an 8th pt come about. For now, this channel contains gold's movements. Now have to get past the $1702 September swing low all over again. For now it looks like gold moved back to test the channel's mid line. Sort of interesting that this lower channel line also anchors back to the Sept $1921 high.
Update: great fakeout by the banksters with a $30 down move in gold followed by a $35 rise within 90 minutes. $65 swing centered on the NFP. Note that the dollar went up during
gold's bounce along with stocks. Unusual to see them all rally together. Now right back to the top of that channel again after sweeping out a lot weak hands.
roadrunner
On the commercial COT front, there was indeed massive closing of shorts last week as expected. It took 2 weeks to add a hefty 35,000 shorts to gold and 37,000 were closed by Tuesday of this past week! On top of that they added 7,900 longs! A change of 45,000 net gold shorts is stunning. And no doubt they closed even more shorts this past Wednesday. In silver, the short to long commercial ratio dropped from 2.32 down to 1.99 as expected. OI on silver at 111,000 which is a modest amount. GLD closing with a weekly bullish hammer at >166.
Knowledge is the enemy of fear
http://blogs.stockcharts.com/canada/2012/03/commodities-the-big-picture.html
Knowledge is the enemy of fear
<< <i>Worthy of posting in this thread as well.
http://blogs.stockcharts.com/canada/2012/03/commodities-the-big-picture.html >>
Fess up, NumbersUSA paid you a whole dollar to link to that article because 10 year charts are described as helpful.
>>
Martin Pring told me that the longest trend is always dominant. That makes sense but I usually use 3 year weekly or daily in my daily reviews. So a regular trip to the 10 year view helps. ...
>>
<< <i>
<< <i>Worthy of posting in this thread as well.
http://blogs.stockcharts.com/canada/2012/03/commodities-the-big-picture.html >>
Fess up, NumbersUSA paid you a whole dollar to link to that article because 10 year charts are described as helpful.
>>
Martin Pring told me that the longest trend is always dominant. That makes sense but I usually use 3 year weekly or daily in my daily reviews. So a regular trip to the 10 year view helps. ...
>> >>
Yes, Numbers did come to mind when I read this.
BTW----Im thinking SELL, and sell hard. 1300 b4 2k. Trying out texting lingo.
Knowledge is the enemy of fear
<< <i>Worthy of posting in this thread as well.
http://blogs.stockcharts.com/canada/2012/03/commodities-the-big-picture.html >>
I think the author suggesting commodities follow a 12 yr up, 6 yr down pattern might be a stretch. That didn't apply to gold and silver over the past 50 yrs. Silver's last bull run was
on the order of 14-18 yrs "up" depending on how you count the surges. I think 1962-1980 works pretty well if one considers the LGP coming on the scene in 1961/1962 to help manage
the gold price. If gold prices weren't capped through the 1960's, and the London Gold Pool's activities were removed, gold too probably would have started rising in the early 1960's rather
than the later 1960's. Silver's price started rising a little bit in 1961, but was fairly flat from 1962-1965, finally doubling up by 1967. Considering the boom in the coin hobby from
1961-1964 that would equate well to a surge in precious metal's interest. Silver's price being sort of flat from 1962-1965 belies the fact that it was started to be hoarded, especially with
the ending of 90% silver coinage in 1964. It's possible that the actions of the LGP on gold, also affected the mindset on silver. Silver actually rose from 1932 onward...never seeing
any substantial pull back until 1980. That cycle might be better interpreted as 48 yrs up, 21 yrs down. Copper prices also rose each year from 1961-1970 coinciding with the first leg
of the precious metal's bull market. Copper peaked in 1980 following an 18-22 yr - 5 wave run. It actually ran from 1932-1956, pulled back for 2 yrs, then from 1958 never went
lower. The author needs to reconsider their 12 up 6 down commodities theory, esp. with metals. It's certainly possible that PMs are looking at a 6 yr down cycle following the
10-12 yr up cycle, but the previous big picture is quite a bit different than what they suggest. One could just as easily say metal prices have been in a bull market since 1932.
Or perhaps a 6 year consolidation. Nothing wrong with gold trading between 1200-2000 and silver 20-40 for several years. Those who bought at the lower end of these ranges will feel quite content, while those at the higher end will feel anxious and disconcerted, which is EXACTLY how investors should feel with any asset class. There are always those who were early to the party and those that were late. But NEVER is everyone early.
Knowledge is the enemy of fear
Knowledge is the enemy of fear
Now lets see if they can manipulate gold higher.
Knowledge is the enemy of fear
<< <i>Took a short position on gold just after noon today.
Now lets see if they can manipulate gold higher. >>
No, but they certainly manipulated it lower on the FED's same old regurgitated news. Just like on Friday's and Monday's dips. A short into the noon $1702 high into that
same resistance point was a reasonable play. I would sort of expect PMs weakness into Wed/Thursday.
FED said everything was to remain the same and that was "reason" to sell down gold and silver at 2:15 pm today. Pushed gold back down to the same $1681 support level. Buyers were quite happy to pick it up at $1678-$1680. These rapid dips in gold since Friday look quite contrived with strong buying near the bottoms. Dow busted through 13,100 on the same old news. Let's not forget Tues-Thurs of these mid-month OE weeks tend to be difficult on the PMs, esp. miners. Yesterday's 3 yr Note auction was ok at 3.27 bid to cover with $34 BILL. sold. Today's 10 yr auction was 3.09 with $22 BILL sold. Tomorrow's 30 yr TBond auction ends the trio a day earlier than usually seen. That will reduce this week's PM pressure a bit earlier.
Ouch....there she goes.....$1660's retest.
<< <i>
<< <i>Took a short position on gold just after noon today.
Now lets see if they can manipulate gold higher. >>
No, but they certainly manipulated it lower on the FED's same old regurgitated news. Just like on Friday's and Monday's dips. A short into the noon $1702 high into that
same resistance point was a reasonable play. I would sort of expect PMs weakness into Wed/Thursday.
FED said everything was to remain the same and that was "reason" to sell down gold and silver at 2:15 pm today. Pushed gold back down to the same $1681 support level. Buyers were quite happy to pick it up at $1678-$1680. These rapid dips in gold since Friday look quite contrived with strong buying near the bottoms. Dow busted through 13,100 on the same old news. Let's not forget Tues-Thurs of these mid-month OE weeks tend to be difficult on the PMs, esp. miners. Yesterday's 3 yr Note auction was ok at 3.27 bid to cover with $34 BILL. sold. Today's 10 yr auction was 3.09 with $22 BILL sold. Tomorrow's 30 yr TBond auction ends the trio a day earlier than usually seen. That will reduce this week's PM pressure a bit earlier.
Ouch....there she goes.....$1660's retest. >>
Gold longs are about to get killed.
Knowledge is the enemy of fear
<< <i>Took a short position on gold just after noon today.
Now lets see if they can manipulate gold higher. >>
Nice call..... good pop to the down side.
In God We Trust.... all others pay in Gold and Silver!
<< <i>certainly possible that PMs are looking at a 6 yr down cycle >>
Inflation will rear it's ugly head in the near future to prevent such a down cycle. One must consider the positive and the negative price triggers for gold. Aside from near zero inflation, a stronger dollar will be required to weaken gold. The next six years promise anything but a strong dollar or near zero inflation. For now I will continue to bet against our economic policy makers - it has paid off handsomely for the last six years. They have given me no reason to not continue doing so and plenty of reason on why I should double down (UGL and AGQ after each FOMC forced price dip
Has anyone besides me considered the possibility that the forced price dips are more about creating profitible volatility for manipulators and their friends than it is about trying to keep metal prices down? Surely they are profiting from it - why shouldn't you and I?
"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey
Fixed it for ya.
Knowledge is the enemy of fear
Sometimes volume by price charts can be useful in determining potential support/resistance levels.
Knowledge is the enemy of fear