I think weather concerns are going to come into effect fairly soon and start pushing prices up, but the timing on that will be difficult.
My yearly trek across the country led me to believe the crops are all quite healthy. Whether healthy enough to justify the destruction in pricing we've seen is another question. Im not looking to trade any grains right now, but as RR mentioned a week ago, sugar is interesting. As is coffee. >>
I sold (futures) too soon. I should have bought at close to $4 but I wasn't at my computer at the time. To confess though, I did hold onto CORN (ETF), and I'm glad I did. Gapped up this morning and on a tear this moment. I don't see corn going much lower than that and any hiccup in the weather should be very bullish.
<< <i>Could go to 1450 or 1200. Equal odds and equal risk does not equal good trading. Im sitting on sidelines for better trade.
Same for silver + or - 15% from here. >>
50-50 odds in the short term? I don't think so. I'm seeing 80-20 and buying. Intermedite term not so rosy. Long term better than ever. >>
I agree. Bought this morning's dip in miners and USLV. It followed the 4 hour chart pattern of July 17th - July 26th to a tee....at least until this morning when a red 4 hour hammer candle became a very long tailed blue hammer.
Nice breakout for gold over 1350 with authority today. 1440 should be in the bag in the next week or two. Also more important, the stock market finally started to show the weakness I was expecting. There might be a small recovery on Friday but there should be more downside next week. Whether this turns into the big crash I've been waiting for we'll have to see.
The huge SLV gap ($23-25) is the major target. It’s just a matter of when (ie next week, next month, Oct-Dec, or next year) but the odds are very high that it will fill. GDX ($38) and GLD ($151) have similar high value gaps from that same period. Some concerns though about the NY trading gap from $20.51 to $20.86 silver during last Sunday/Monday's liftoff. That’s a huge gap for NY not to have been involved in. It’s the equivalent of a $20 gold “gap” w/o NY participation. In the case of gold, at least it got down to $1318, a mere $3 difference from the $1315 Sunday night gap area. I tend to think that before we can fill that huge SLV gap, that NY trading gap we left behind has to be addressed. Just a thought.
The icing on the cake may be the positioning of the commercials. The producer/merchants/banks while nearly flat gold at 1.07 short to long ratio (bullish) are very heavily short silver (3.28 short to long ratio). So far they’ve shown themselves to be the smart money vs. the swap dealers. If the banks were actually “bullish” on silver, why are they positioned so heavily short it and at the same time they are very long gold (+56K net long per Bank Participation Report)? GSR has had quite a drop from 67.5 to 58.6, it’s retraced 50% of the move from Oct to July. The 4 hour chart is showing some strong neg divergences. The 8 hr and daily still need work in macd. Still, how much further is GSR going to drop before a sharp kickback to from a right shoulder? GSR also just tagged the 2 year uptrend line. Daily rsi is now dead flat at 21. On the 2 previous hard dips of the past 2 yr rally, the lows were at 17 and 25. With the first weekly macd histogram in neg territory, I’d think that another 4-5 will be tacked on before weekly macd turns.
Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
<< <i>Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
Overall---equilibrium. >>
Historically, it looks like whenever the 50 crosses the 200 on an upturn that the 50 continues on for a nice positive run. Hope it repeats. Appears to be the same results on a 50 downturn resulting in a continued negative run.
Natural forces of supply and demand are the best regulators on earth.
<< <i>Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
Overall---equilibrium. >>
Historically, it looks like whenever the 50 crosses the 200 on an upturn that the 50 continues on for a nice positive run. Hope it repeats. Appears to be the same results on a 50 downturn resulting in a continued negative run. >>
I agree. Now how would that translate to metals prices.
I've been trying to show the obvious parallels to the 2003-2008 GSR chart to the one from 2008-2013 ever since we got the monthly breakout in April of the 5 year downtrend. 2008 gave us 4 strong upward months (Aug-Nov) before the GSR halted. It went quite high back then since in unison the dollar went up to 88. Perfect storm. This time around there is no big dollar boost....at least not yet. I suspect that the GSR is pretty much cooked. It's daily momentum has been on the wane for months now showing neg divergences. Rather trying to put trend lines on GSR look at the cycle pattern of the monthly candles in each 5 yr period.
The weekly chart is 3-4 weeks into a dive where normally these have taken 8 weeks to bottom. August's monthly bearish engulfing candle with probably pull back a bit into end of month OpEx to more closely match the bearish December 2008 monthly candle. In any case the parallels between the 2 time periods are quite striking. Toss in the expanding 3 month wedge on the dollar that projects down to 79 and I think we have a fair idea where GSR could be headed into the months ahead. I used the NetDania monthly gsr chart to do the analysis. Gaps in GSR at 55 and 57 are possible first targets for the bottom of this entire move. But for now, GSR has tagged the 2 year uptrend line and retraced 50% of the upward move. A rest here is probably in the works. In fact I think it's bottomed for the time being. Hopefully, gold goes up more than silver during the bounce rather than gold dropping less than silver. I still think last Sunday's opening gap around $20.52 eventually gets filled. The NY guys didn't get a stab at 30c of the upmove.
Can you even "cook" a GSR? Maybe I should have said "toast." But you can eat toast, and not gold.
Could be a good bounce in GSR around the corner. GSR drop from 67 to 58 looks a lot like the smash to gold and silver not too long ago. Tables reversed.
Hopefully, gold goes up more than silver during the bounce rather than gold dropping less than silver.
This is why I question the value of this indicator, because of this very observation. The question is whether or not they are both going up or down, not in the relative sharpness of the curves.
The analogy of 2003-2008 to now is also questionable because that timeframe exhibited more economic vitality than now, and it was pre-Lehman, pre-bailout, pre-FASB trashing, pre-Fannie & Freddie, pre-obam, pre-stimulus, pre-student loan crisis, pre-Libor revelations, pre-obamacare and pre-QE to infinity. The Bush years were simply the springboard years.
We are in completely uncharted waters here, and the old comparisons can't be all that meaningful, in my opinion. And that's only an opinion, but I'm sticking to it.
We could still see gold & silver drop precipitously and still be the best game in town. Or vice versa, they could skyrocket and be the best game in town. Or they could be banned (capital controls). I wouldn't rule out any of these.
When I read on ZeroHedge about the decrease in fulltime jobs and increase of part-time jobs, and how that is going to impact Social Security it's just one more straw on the camel's back.
You can't plan for every contingency, nor can you know everything or what might be optimal but you can evaluate and take your best shot. I'm just trying to lean in the right direction, and pms seem to have the least array of problems associated with them in the longterm.
Q: Are You Printing Money? Bernanke: Not Literally
This is why I question the value of this indicator, because of this very observation. The question is whether or not they are both going up or down, not in the relative sharpness of the curves. The analogy of 2003-2008 to now is also questionable because that timeframe exhibited more economic vitality than now, and it was pre-Lehman, pre-bailout, pre-FASB trashing, pre-Fannie & Freddie, pre-obam, pre-stimulus, pre-student loan crisis, pre-Libor revelations, pre-obamacare and pre-QE to infinity. The Bush years were simply the springboard years.
GSR is a key indicator. It demonstrates when liquidity is or isn't flowing into mainstream financial assets. It's not really important as to how gold or silver react, but the overall direction of GSR. 2003-2008 had similar ear marks to 2008-2013 as both started off as bounces from recessionary/deleveraging periods. We have just as many cracks and strains on the financial and monetary systems today than we did in 2007-2008, even if there is no Lehman bust front and center. We could probably say things are worse today with the big banks even larger and as leveraged up with derivatives as they were in 2007. As long as we're dumping $Trillions at the problem (unlike 2007-Sept 2008) the status quo will be maintained. 2003-2008 may have exhibited more real economic vitality, but since 2009 we've toss a heckuva lot more money at the problem. The higher high in the stock market is one major difference from all the liquidity flowing. The stock market from 2000-2013 is doing pretty much the same thing as we saw before back in 1966-1976.
Can you explain how GSR is a reflection on liquidity? Why would gold or silver move a particular way relative to each other for a given liquidity condition?
<< <i>Can you explain how GSR is a reflection on liquidity? Why would gold or silver move a particular way relative to each other for a given liquidity condition? >>
It's due to the fact of the additonal speculative nature of silver and that at the same time it's a key industrial metal used in numerous ways in the economy. Gold is just an alternative currency as is silver at times. One can't line up every GSR move with every economic contraction or boom, but there is plenty of rhyming. GSR doubled from 1998-2003 during that recessionary period as money was flowing out of stocks and silver. GSR fell through the 2004-2007 housing and stock boom. It also fell during the SM recovery from 2009-2010. GSR rising through most of 2011-2013 is indicative of money flows not making it into more speculative financial assets. While the HFT's may be bidding up the SM, the average guy isn't taking part this time around. Some other liquidity measures include Euro/Yen, Nzd/Yen crosses and Hyg/Lqd corporate bond yield ratios.
Bob Hoye has been following GSR history for 30 years or more to call major and minor trend changes. Pretty hard to argue with historical analysis that has worked for so long.
In general I can't disagree with that explanation, but we also get that information anecdotally from the financial news most of the time. Still, that does show how gold acts as a nonpartisan arbiter of value when nothing else seems to have an anchor.
Q: Are You Printing Money? Bernanke: Not Literally
Speaking of financial news, I'm looking forward to a new, non-mainstream 24-hr. news channel popping up in the next few days on directv channel 358. Hoping that they have some good unbiased financial news.
Gold looking good after this 38.2% retrace which is now complete. We should be ready to proceed upwards now, although an overnight dip to 1356 would be an opportunity not to miss.
The fractal charts are showing that we might not be able to reach 1440 in this move, but 1400 does look attainable and I can definitely see that being a resistance level. Ackerman has a short term 1411 target which I think would be a spike. I am going to lighten up at 1410.
My CORN ETF purchase continues to run nicely. Up 6% since I bought.
<< <i>How did you come up with a 38% retrace. The largest one I can pull off the chart is 33%. >>
I can't reproduce it and I don't see it anymore. Not sure what I was looking at. But here at night with further weakness I do see potential for completion of 38.2 retraces but it's too early to say. It's here at 1356 at the moment, good chance to load up for a solid $50 move.
We now have a 47% retrace from $1316 with last night's low to $1352, right where yesterday's mini-H&S breakdown suggested gold would go. That might be enough but a 50% retrace of the 3rd leg would take it exactly to $1350. Not likely they deliver 50% on a platter in NY time so that all the late bulls can climb onboard.
In June, foreign investors dumped $5.2 billion of Fannie Mae, Freddie Mac, and Ginnie Mae bonds, $5 billion in corporate bonds, and $40.8 billion in US Treasury bonds-all part of the $66.9 billion in sales of other long-term US securities.
That is the biggest monthly dumping of Treasuries by foreign creditors since 1977!
<< <i>I agree. Now how would that translate to metals prices. >>
Since it's a chart of ratio, only thing I can deduct is that gold should outperform silver. Gut tells me silver will outperform gold.
Note that I do expect another dip in metal prices before a strong upleg, and that view is independent of the chart.
In all seriousness, you're the chart guy - teach me something here. >>
only thing I can deduct is that gold should outperform silver
Thats about all one can reasonably deduct. However, I believe gold usually outperforms silver when both are in downtrends, so I would surmise the bull beatings to continue.
I like the price action in gold the last few days. Short term charts are loaded with energy and ready to break over 1380 to finally take us up to $1440. SP500 retraced its last move down and is loaded with energy also - most likely to the down side to continue the slide. These moves may wait until next week.
Some similarities to last July/August period. If you put GDX into that chart that's already into the upper BB (leading gold so far). The steep corrective action is grains, softs, etc. the past week is sort of non-confirming to the metals. GSR looks ripe for a turn here. The dollar could do the same. It's stuck in no man's land of 81.0 - 82.0. If it breaks higher after just touching the 2 yr uptrend line it could put any PM rise on hold. But if it falls through that 81 support it's game on again. AUD and CAD have been going down the past 2 weeks which has coincided with weakness in PMs. The 10yr/2yr yield ratio has also been in decline since the start of the month and has not been there to support metals the past week. It's currently still diving.
Regardless of all that.....just got the pop to >$1384 at 10:00 am NY time due to the 13.5% drop in new home sales. Way less than expected. Looks like the August 2012 gold chart. Dollar tanking once again. 81 needs to hold or that 2 yr uptrend gets broken.
Housing missed the estimate by 90,000 homes (17% miss). Even the prior month was revised DOWN 40,000 (make it a 25% miss). Taper talk sent rates up and now housing down.
Grains (Corn) on fire this morning. Up 8.5% on my ETF position this morning since I bought a week or two ago. I like gold's push to 1407 last night. Here's your chance to load up at $1395 before we hit $1440.
I also think this is a good short at ES (SP500 futures) 1666. I'm ready to bail if it takes off, but the downside slide has begun. It may not be the crash I was looking for, but serious damage is coming in the major indexes for the rest of the year.
I found it most ironic that this is the 2nd time in a row where miners were crushed on day 47. The last 2 daily crushings this big were in April and June or about 9-1/2 weeks apart. In looking back at the GDX pattern in Oct-Dec 2008 it rallied up to day 47 then went into a multi-week correction. The bulk of the rally occurred by day 37. Our recent GDX rally pretty much reached max RSI on day 36. GDX's bearish doji star pattern from yesterday certainly played out today. GLD and SLV are essentially showing patterns today (bearish shooting star). Goldcorp and BVN today bearishly engulfed the previous 7 daily candles. GDX missed by only around 20 cents. How often do you see that? Maybe GSR is getting ready to flip back around in the other direction after its 10 point drop.
Gold and silver approaching massive resistance. I'll never post on these boards again if silver blows thru 26 and gold thru 1550 this year. >>
Don't go that far cohodk. $1550 gold is highly unlikely this year but silver going to $27 or $28 before winter is a real possibility. A larger than anticipated flare up in the Middle East is the wildcard.
Thanks, I've been really pleased with everything lately. I have quadrupled my futures account which had been pretty beaten up on this move since the end of June. I trade options in my other account and have done well with the Spyder puts and CORN and GLD calls there as well but I don't like to hang on to options too long so I sold most of those too early. Still hanging on to some Spyder puts as more blood is coming in stocks for at least another week.
I expected more of a pullback and delay from gold before hitting the target of 1440+, but it might just happen in a frenzy tonight. It will be overall long-term bullish for it to get there this fast, but it will need to turn around. Perhaps the divergence seen in the mining stocks today is indicating that. I'm actually looking to short gold on any spike over 1440, as I just don't think it will hold. A retrace of this move up will take it back $100 which would be another nice ride to catch.
Edited to add: $1500 gold or so might be possible but if it does happen it won't until December or so. I'll know more in a few months.
Edited to add again: Although I was convinced that gold will top out on this move at 1440-1450, I'm not sure shorting gold is a good idea given the situation in Syria. If I do it will be a small position and I will bail quickly.
The pullback in gold looked worrisome and for a bit I was concerned that gold had stopped short of its 1440-1450 goal. But it appears to just be fulfilling a 38.2% pullback and no new trend appears to have started. I think we'll be back on track for 1440+ next week, with perhaps even a decent spike above to suck in more gold bulls, perhaps on excitement about Syria. But I think it is a trap and I have to stick with my initial assessment that $1500 is about the max for this year, which means we'll spend the next few months trying to get through 1440-1450 on a permanent basis.
I added to my short SPY position today, but it seems to have a lot of resilience. The technical signs really do not look good for SPY, but it sure isn't dropping like I thought it would.
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly more to come.
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits.
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits. >>
Stock splits, either forward or reverse, normally have no affect on the portfolio value. It they re-issue you ten times the amount of shares and at the same time reduce the price by one-tenth your portfolio value remains unchanged. Increasing or decreasing the number of shares while at the same time adjusting the price accordingly is really about re-setting the price of the stock, and is often done to give it either more room for price growth or more room for price declines. In the case of USLV and its 10-1 reverse split it appears fund manager feels the need to allow for further price declines. Another reason for reverse splits is the need to raise issue's price above a certain dollar amount because some exchanges will de-list an issue if the price falls below a certain level. When this occurs trading in the issue becomes a hassle for the buyer and for the seller.
Natural forces of supply and demand are the best regulators on earth.
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits. >>
Stock splits, either forward or reverse, normally have no affect on the portfolio value. It they re-issue you ten times the amount of shares and at the same time reduce the price by one-tenth your portfolio value remains unchanged. Increasing or decreasing the number of shares while at the same time adjusting the price accordingly is really about re-setting the price of the stock, and is often done to give it either more room for price growth or more room for price declines. In the case of USLV and its 10-1 reverse split it appears fund manager feels the need to allow for further price declines. Another reason for reverse splits is the need to raise issue's price above a certain dollar amount because some exchanges will de-list an issue if the price falls below a certain level. When this occurs trading in the issue becomes a hassle for the buyer and for the seller. >>
How true. happened to me with C a few years back. A $2.50 stock, overnight became a $25 stock. The sad part was that the dividend remained the same.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
fund manager sees the need for further price declines.
Sometimes I think you could find conspiracy in a box of Cheerios.
Leveraged etfs are subject to the rules of compounding unlike a typical stock. However I think I have only seen reverse split appreciate over time once in 25 years.
Silver is going down because it is not a relative value. I.E. overpriced. USLV will drop because silver is overpriced, not because a fund manager sees a need for further declines. Whether it is priced at 90 or 9 doesn't matter. These reverse splits do have an effect on trading as volume declines and on the number of traders participating. J6P who bought 500 shares at 9 now has 50 shares at 90. He feels diminished and is unlikely to sell his shares thinking 50 is not important. He will die with those shares.
J6P who bought 500 shares at 9 now has 50 shares at 90. He feels diminished and is unlikely to sell his shares thinking 50 is not important. He will die with those shares.
You underestimate J6P. You really think that he doesn't know that he has the same amount tied up in the stock? Everyone's motivations are different and when J6P needs the money, it's still there and can be liquidated.
If there is a dividend involved, splits and reverse splits can affect dividend payouts and tax consequences depending on when it goes ex-dividend, but generally a stock split or reverse stock split is a wash.
Q: Are You Printing Money? Bernanke: Not Literally
<< <i>fund manager sees the need for further price declines.
Sometimes I think you could find conspiracy in a box of Cheerios.
Leveraged etfs are subject to the rules of compounding unlike a typical stock. However I think I have only seen reverse split appreciate over time once in 25 years.
Silver is going down because it is not a relative value. I.E. overpriced. USLV will drop because silver is overpriced, not because a fund manager sees a need for further declines. Whether it is priced at 90 or 9 doesn't matter. These reverse splits do have an effect on trading as volume declines and on the number of traders participating. J6P who bought 500 shares at 9 now has 50 shares at 90. He feels diminished and is unlikely to sell his shares thinking 50 is not important. He will die with those shares. >>
Silver written off way too early in this decine. It's outperforming gold on the rebound from Sunday night's attack with GSR now nearly retesting last week's bottom in the 57's.
It matters to me whether Nugt is at $9 or $90. At $90 I'm much less likely to want to play with it. 50 shares (vs. 5,000) seems like a pittance even if the total price paid in unchanged.
<< <i>Jmski, I understand J6P completely and Roadrunner confirmed. >>
>>
Sorry Roadrunner. I did not mean to infer that you are J6P. Rather you just supported my belief that people do not like $90 stocks or owning 50 shares.
Comments
Same for silver + or - 15% from here.
Knowledge is the enemy of fear
<< <i>Could go to 1450 or 1200. Equal odds and equal risk does not equal good trading. Im sitting on sidelines for better trade.
Same for silver + or - 15% from here. >>
50-50 odds in the short term? I don't think so. I'm seeing 80-20 and buying. Intermedite term not so rosy. Long term better than ever.
Natural forces of supply and demand are the best regulators on earth.
<< <i>Nice discipline PC.
I think weather concerns are going to come into effect fairly soon and start pushing prices up, but the timing on that will be difficult.
My yearly trek across the country led me to believe the crops are all quite healthy. Whether healthy enough to justify the destruction in pricing we've seen is another question. Im not looking to trade any grains right now, but as RR mentioned a week ago, sugar is interesting. As is coffee. >>
I sold (futures) too soon. I should have bought at close to $4 but I wasn't at my computer at the time.
To confess though, I did hold onto CORN (ETF), and I'm glad I did. Gapped up this morning and on a tear this moment. I don't see corn going much lower than that and any hiccup in the weather should be very bullish.
<< <i>
<< <i>Could go to 1450 or 1200. Equal odds and equal risk does not equal good trading. Im sitting on sidelines for better trade.
Same for silver + or - 15% from here. >>
50-50 odds in the short term? I don't think so. I'm seeing 80-20 and buying. Intermedite term not so rosy. Long term better than ever. >>
I agree. Bought this morning's dip in miners and USLV. It followed the 4 hour chart pattern of July 17th - July 26th to a tee....at least until this morning when a red 4 hour hammer
candle became a very long tailed blue hammer.
(I shoulda put this in the 2013 contest.)
I'll prolly add smoe shares when/if it dips below $1. Disclaimer - own smoe shares.
The icing on the cake may be the positioning of the commercials. The producer/merchants/banks while nearly flat gold at 1.07 short to long ratio (bullish) are very heavily short silver (3.28 short to long ratio). So far they’ve shown themselves to be the smart money vs. the swap dealers. If the banks were actually “bullish” on silver, why are they positioned so heavily short it and at the same time they are very long gold (+56K net long per Bank Participation Report)? GSR has had quite a drop from 67.5 to 58.6, it’s retraced 50% of the move from Oct to July. The 4 hour chart is showing some strong neg divergences. The 8 hr and daily still need work in macd. Still, how much further is GSR going to drop before a sharp kickback to from a right shoulder? GSR also just tagged the 2 year uptrend line. Daily rsi is now dead flat at 21. On the 2 previous hard dips of the past 2 yr rally, the lows were at 17 and 25. With the first weekly macd histogram in neg territory, I’d think that another 4-5 will be tacked on before weekly macd turns.
Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
Overall---equilibrium.
Knowledge is the enemy of fear
<< <i>Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
Overall---equilibrium. >>
Historically, it looks like whenever the 50 crosses the 200 on an upturn that the 50 continues on for a nice positive run. Hope it repeats. Appears to be the same results on a 50 downturn resulting in a continued negative run.
Natural forces of supply and demand are the best regulators on earth.
<< <i>
<< <i>Dont know what to make of this chart. Trying to keep it simple--the 50 week average is moving up through the 200 week. The 200 week is sideways, but maybe trying to turn higher. The decline in 2011 looks like a capitulation low. Average over the last 15 years seems to be about the current level.
Overall---equilibrium. >>
Historically, it looks like whenever the 50 crosses the 200 on an upturn that the 50 continues on for a nice positive run. Hope it repeats. Appears to be the same results on a 50 downturn resulting in a continued negative run. >>
I agree. Now how would that translate to metals prices.
Knowledge is the enemy of fear
<< <i>I agree. Now how would that translate to metals prices. >>
Since it's a chart of ratio, only thing I can deduct is that gold should outperform silver. Gut tells me silver will outperform gold.
Note that I do expect another dip in metal prices before a strong upleg, and that view is independent of the chart.
In all seriousness, you're the chart guy - teach me something here.
Natural forces of supply and demand are the best regulators on earth.
2008 gave us 4 strong upward months (Aug-Nov) before the GSR halted. It went quite high back then since in unison the dollar went up to 88. Perfect storm. This time around
there is no big dollar boost....at least not yet. I suspect that the GSR is pretty much cooked. It's daily momentum has been on the wane for months now showing neg divergences.
Rather trying to put trend lines on GSR look at the cycle pattern of the monthly candles in each 5 yr period.
The weekly chart is 3-4 weeks into a dive where normally these have taken 8 weeks to bottom. August's monthly bearish engulfing candle with probably pull back a bit into end of
month OpEx to more closely match the bearish December 2008 monthly candle. In any case the parallels between the 2 time periods are quite striking. Toss in the expanding
3 month wedge on the dollar that projects down to 79 and I think we have a fair idea where GSR could be headed into the months ahead. I used the NetDania monthly gsr chart
to do the analysis. Gaps in GSR at 55 and 57 are possible first targets for the bottom of this entire move. But for now, GSR has tagged the 2 year uptrend line and retraced 50% of
the upward move. A rest here is probably in the works. In fact I think it's bottomed for the time being. Hopefully, gold goes up more than silver during the bounce rather than gold
dropping less than silver. I still think last Sunday's opening gap around $20.52 eventually gets filled. The NY guys didn't get a stab at 30c of the upmove.
Natural forces of supply and demand are the best regulators on earth.
<< <i>Did you say "cooked?"
Can you even "cook" a GSR? Maybe I should have said "toast." But you can eat toast, and not gold.
Could be a good bounce in GSR around the corner. GSR drop from 67 to 58 looks a lot like the smash to gold and silver not too long ago. Tables reversed.
This is why I question the value of this indicator, because of this very observation. The question is whether or not they are both going up or down, not in the relative sharpness of the curves.
The analogy of 2003-2008 to now is also questionable because that timeframe exhibited more economic vitality than now, and it was pre-Lehman, pre-bailout, pre-FASB trashing, pre-Fannie & Freddie, pre-obam, pre-stimulus, pre-student loan crisis, pre-Libor revelations, pre-obamacare and pre-QE to infinity. The Bush years were simply the springboard years.
We are in completely uncharted waters here, and the old comparisons can't be all that meaningful, in my opinion. And that's only an opinion, but I'm sticking to it.
We could still see gold & silver drop precipitously and still be the best game in town. Or vice versa, they could skyrocket and be the best game in town. Or they could be banned (capital controls). I wouldn't rule out any of these.
When I read on ZeroHedge about the decrease in fulltime jobs and increase of part-time jobs, and how that is going to impact Social Security it's just one more straw on the camel's back.
You can't plan for every contingency, nor can you know everything or what might be optimal but you can evaluate and take your best shot. I'm just trying to lean in the right direction, and pms seem to have the least array of problems associated with them in the longterm.
I knew it would happen.
GSR is a key indicator. It demonstrates when liquidity is or isn't flowing into mainstream financial assets. It's not really important as to how gold or silver react, but the overall
direction of GSR. 2003-2008 had similar ear marks to 2008-2013 as both started off as bounces from recessionary/deleveraging periods. We have just as many cracks and strains on
the financial and monetary systems today than we did in 2007-2008, even if there is no Lehman bust front and center. We could probably say things are worse today with the big banks
even larger and as leveraged up with derivatives as they were in 2007. As long as we're dumping $Trillions at the problem (unlike 2007-Sept 2008) the status quo will be maintained.
2003-2008 may have exhibited more real economic vitality, but since 2009 we've toss a heckuva lot more money at the problem. The higher high in the stock market is one major
difference from all the liquidity flowing. The stock market from 2000-2013 is doing pretty much the same thing as we saw before back in 1966-1976.
<< <i>Can you explain how GSR is a reflection on liquidity? Why would gold or silver move a particular way relative to each other for a given liquidity condition? >>
It's due to the fact of the additonal speculative nature of silver and that at the same time it's a key industrial metal used in numerous ways in the economy. Gold is just
an alternative currency as is silver at times. One can't line up every GSR move with every economic contraction or boom, but there is plenty of rhyming. GSR doubled from
1998-2003 during that recessionary period as money was flowing out of stocks and silver. GSR fell through the 2004-2007 housing and stock boom. It also fell during the SM
recovery from 2009-2010. GSR rising through most of 2011-2013 is indicative of money flows not making it into more speculative financial assets. While the HFT's may be
bidding up the SM, the average guy isn't taking part this time around. Some other liquidity measures include Euro/Yen, Nzd/Yen crosses and Hyg/Lqd corporate bond yield ratios.
Bob Hoye has been following GSR history for 30 years or more to call major and minor trend changes. Pretty hard to argue with historical analysis that has worked for so long.
I knew it would happen.
A more sobering look at the news?
Natural forces of supply and demand are the best regulators on earth.
<< <i>Hoping that they have some good unbiased financial news. >>
This doesnt exist
If it turns out to be worthwhile, please update here. Im debating whether to go directv or att for my tv service in the next few weeks.
BST Transactions (as the seller): Collectall, GRANDAM, epcjimi1, wondercoin, jmski52, wheathoarder, jay1187, jdsueu, grote15, airplanenut, bigole
The fractal charts are showing that we might not be able to reach 1440 in this move, but 1400 does look attainable and I can definitely see that being a resistance level. Ackerman has a short term 1411 target which I think would be a spike. I am going to lighten up at 1410.
My CORN ETF purchase continues to run nicely. Up 6% since I bought.
<< <i>How did you come up with a 38% retrace. The largest one I can pull off the chart is 33%. >>
I can't reproduce it and I don't see it anymore. Not sure what I was looking at.
But here at night with further weakness I do see potential for completion of 38.2 retraces but it's too early to say. It's here at 1356 at the moment, good chance to load up for a solid $50 move.
That might be enough but a 50% retrace of the 3rd leg would take it exactly to $1350. Not likely they deliver 50% on a platter in NY time so that all the
late bulls can climb onboard.
That is the biggest monthly dumping of Treasuries by foreign creditors since 1977!
BST Transactions (as the seller): Collectall, GRANDAM, epcjimi1, wondercoin, jmski52, wheathoarder, jay1187, jdsueu, grote15, airplanenut, bigole
<< <i>
<< <i>I agree. Now how would that translate to metals prices. >>
Since it's a chart of ratio, only thing I can deduct is that gold should outperform silver. Gut tells me silver will outperform gold.
Note that I do expect another dip in metal prices before a strong upleg, and that view is independent of the chart.
In all seriousness, you're the chart guy - teach me something here. >>
only thing I can deduct is that gold should outperform silver
Thats about all one can reasonably deduct. However, I believe gold usually outperforms silver when both are in downtrends, so I would surmise the bull beatings to continue.
Knowledge is the enemy of fear
Some similarities to last July/August period. If you put GDX into that chart that's already into the upper BB (leading gold so far).
The steep corrective action is grains, softs, etc. the past week is sort of non-confirming to the metals. GSR looks ripe for a turn here. The dollar could do the same.
It's stuck in no man's land of 81.0 - 82.0. If it breaks higher after just touching the 2 yr uptrend line it could put any PM rise on hold. But if it falls through that 81 support
it's game on again. AUD and CAD have been going down the past 2 weeks which has coincided with weakness in PMs. The 10yr/2yr yield ratio has also been in decline since
the start of the month and has not been there to support metals the past week. It's currently still diving.
Regardless of all that.....just got the pop to >$1384 at 10:00 am NY time due to the 13.5% drop in new home sales. Way less than expected. Looks like the August 2012 gold chart.
Dollar tanking once again. 81 needs to hold or that 2 yr uptrend gets broken.
Housing missed the estimate by 90,000 homes (17% miss). Even the prior month was revised DOWN 40,000 (make it a 25% miss). Taper talk sent rates up and now housing down.
I like gold's push to 1407 last night. Here's your chance to load up at $1395 before we hit $1440.
I also think this is a good short at ES (SP500 futures) 1666. I'm ready to bail if it takes off, but the downside slide has begun. It may not be the crash I was looking for, but serious damage is coming in the major indexes for the rest of the year.
In looking back at the GDX pattern in Oct-Dec 2008 it rallied up to day 47 then went into a multi-week correction. The bulk of the rally occurred by day 37. Our recent GDX rally
pretty much reached max RSI on day 36. GDX's bearish doji star pattern from yesterday certainly played out today. GLD and SLV are essentially showing patterns today (bearish
shooting star). Goldcorp and BVN today bearishly engulfed the previous 7 daily candles. GDX missed by only around 20 cents. How often do you see that? Maybe GSR is getting
ready to flip back around in the other direction after its 10 point drop.
Miner charts
Gold and silver approaching massive resistance. I'll never post on these boards again if silver blows thru 26 and gold thru 1550 this year.
Knowledge is the enemy of fear
<< <i>Nice trades PC.
Gold and silver approaching massive resistance. I'll never post on these boards again if silver blows thru 26 and gold thru 1550 this year.
Don't go that far cohodk. $1550 gold is highly unlikely this year but silver going to $27 or $28 before winter is a real possibility. A larger than anticipated flare up in the Middle East is the wildcard.
<< <i>Nice trades PC. >>
Thanks, I've been really pleased with everything lately. I have quadrupled my futures account which had been pretty beaten up on this move since the end of June. I trade options in my other account and have done well with the Spyder puts and CORN and GLD calls there as well but I don't like to hang on to options too long so I sold most of those too early. Still hanging on to some Spyder puts as more blood is coming in stocks for at least another week.
I expected more of a pullback and delay from gold before hitting the target of 1440+, but it might just happen in a frenzy tonight. It will be overall long-term bullish for it to get there this fast, but it will need to turn around. Perhaps the divergence seen in the mining stocks today is indicating that. I'm actually looking to short gold on any spike over 1440, as I just don't think it will hold. A retrace of this move up will take it back $100 which would be another nice ride to catch.
Edited to add:
$1500 gold or so might be possible but if it does happen it won't until December or so. I'll know more in a few months.
Edited to add again:
Although I was convinced that gold will top out on this move at 1440-1450, I'm not sure shorting gold is a good idea given the situation in Syria. If I do it will be a small position and I will bail quickly.
Knowledge is the enemy of fear
Midwest hot, dry spell renews worries that drought conditions may cut corn, soybean harvest
Contradicts
Corn Falls as Heat Damage May Be Limited; Wheat Drops; Soy Gains
The pullback in gold looked worrisome and for a bit I was concerned that gold had stopped short of its 1440-1450 goal. But it appears to just be fulfilling a 38.2% pullback and no new trend appears to have started. I think we'll be back on track for 1440+ next week, with perhaps even a decent spike above to suck in more gold bulls, perhaps on excitement about Syria. But I think it is a trap and I have to stick with my initial assessment that $1500 is about the max for this year, which means we'll spend the next few months trying to get through 1440-1450 on a permanent basis.
I added to my short SPY position today, but it seems to have a lot of resilience. The technical signs really do not look good for SPY, but it sure isn't dropping like I thought it would.
Natural forces of supply and demand are the best regulators on earth.
Knowledge is the enemy of fear
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly
more to come.
<< <i>
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly
more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits.
Knowledge is the enemy of fear
<< <i>
<< <i>
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly
more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits. >>
Stock splits, either forward or reverse, normally have no affect on the portfolio value. It they re-issue you ten times the amount of shares and at the same time reduce the price by one-tenth your portfolio value remains unchanged. Increasing or decreasing the number of shares while at the same time adjusting the price accordingly is really about re-setting the price of the stock, and is often done to give it either more room for price growth or more room for price declines. In the case of USLV and its 10-1 reverse split it appears fund manager feels the need to allow for further price declines. Another reason for reverse splits is the need to raise issue's price above a certain dollar amount because some exchanges will de-list an issue if the price falls below a certain level. When this occurs trading in the issue becomes a hassle for the buyer and for the seller.
Natural forces of supply and demand are the best regulators on earth.
<< <i>
<< <i>
<< <i>
<< <i>10 for 1 reverse split overnight with USLV. >>
They seem to do this just before an ETF gets smashed. Happened twice with Nugt. This last time they also did a Nugt 10-1 inverse split....right before a 32% dump with possibly
more to come. >>
Its really more based on mathematics and the effects of compounding. But yes, astute and nimble traders can and do take advantage of these splits. >>
Stock splits, either forward or reverse, normally have no affect on the portfolio value. It they re-issue you ten times the amount of shares and at the same time reduce the price by one-tenth your portfolio value remains unchanged. Increasing or decreasing the number of shares while at the same time adjusting the price accordingly is really about re-setting the price of the stock, and is often done to give it either more room for price growth or more room for price declines. In the case of USLV and its 10-1 reverse split it appears fund manager feels the need to allow for further price declines. Another reason for reverse splits is the need to raise issue's price above a certain dollar amount because some exchanges will de-list an issue if the price falls below a certain level. When this occurs trading in the issue becomes a hassle for the buyer and for the seller. >>
How true. happened to me with C a few years back. A $2.50 stock, overnight became a $25 stock. The sad part was that the dividend remained the same.
Sometimes I think you could find conspiracy in a box of Cheerios.
Leveraged etfs are subject to the rules of compounding unlike a typical stock. However I think I have only seen reverse split appreciate over time once in 25 years.
Silver is going down because it is not a relative value. I.E. overpriced. USLV will drop because silver is overpriced, not because a fund manager sees a need for further declines. Whether it is priced at 90 or 9 doesn't matter. These reverse splits do have an effect on trading as volume declines and on the number of traders participating. J6P who bought 500 shares at 9 now has 50 shares at 90. He feels diminished and is unlikely to sell his shares thinking 50 is not important. He will die with those shares.
Knowledge is the enemy of fear
You underestimate J6P. You really think that he doesn't know that he has the same amount tied up in the stock? Everyone's motivations are different and when J6P needs the money, it's still there and can be liquidated.
If there is a dividend involved, splits and reverse splits can affect dividend payouts and tax consequences depending on when it goes ex-dividend, but generally a stock split or reverse stock split is a wash.
I knew it would happen.
<< <i>fund manager sees the need for further price declines.
Sometimes I think you could find conspiracy in a box of Cheerios.
Leveraged etfs are subject to the rules of compounding unlike a typical stock. However I think I have only seen reverse split appreciate over time once in 25 years.
Silver is going down because it is not a relative value. I.E. overpriced. USLV will drop because silver is overpriced, not because a fund manager sees a need for further declines. Whether it is priced at 90 or 9 doesn't matter. These reverse splits do have an effect on trading as volume declines and on the number of traders participating. J6P who bought 500 shares at 9 now has 50 shares at 90. He feels diminished and is unlikely to sell his shares thinking 50 is not important. He will die with those shares. >>
Silver written off way too early in this decine. It's outperforming gold on the rebound from Sunday night's attack with GSR now nearly retesting last week's bottom in the 57's.
It matters to me whether Nugt is at $9 or $90. At $90 I'm much less likely to want to play with it. 50 shares (vs. 5,000) seems like a pittance even if the total price paid in unchanged.
Knowledge is the enemy of fear
<< <i>Jmski, I understand J6P completely and Roadrunner confirmed. >>
<< <i>
<< <i>Jmski, I understand J6P completely and Roadrunner confirmed. >>
Sorry Roadrunner. I did not mean to infer that you are J6P. Rather you just supported my belief that people do not like $90 stocks or owning 50 shares.
Knowledge is the enemy of fear