<< <i>If the current leg stops short of $1000 (not that it must) it will just reinforce in the minds of all fiat/credit lovers once and for all that gold is a complete and total bust and waste of time and money. Unfortunately this will be the exact wrong time to be thinking that. On the next swing up it will be too late to get on board as gold will be moving swiftly as every hedge fund and their brother instantly try to board in the $1040-$1100 range. The price will probably blow right through there in a day or two on its way to $1200-$1400 within a week. Those that joined late will get shaken out on a violent move back down to $1000 or lower to place them into a big loss position. And once shaken out, gold will rebound and leave more people in the dust unwilling to pay even more money to be able to get back on board. >>
that is true. Gold tends to behave in a way that it takes off just as all but the perma-bulls lose faith. A rise up to $970-1000 followed by a swift correction to the low $900's would be a good way to accomplish this. Once it takes off, people waiting for a dip to buy back in will be disappointed at the lack of opportunities.
The stock market is also still in a bull run. I'm still expecting the S&P500 to recover back to at least 1050.
No problem. Having a monthly gold/silver,etc. trading thread makes things here a lot easier to find, esp if you can remember about the time frame involved. I don't know how many times I've gone looking back through the main thread of 10,000+ posts trying to find a key link up to some statistic. It would be nice to keep a single reference page to all links that some of us routinely use (BLS jobs, cpi stats, COT data, BIS derivatives stats, TIC, gold and silver reference and historical numbers, BEA economic data, etc.)
At least I had one thing right for May, and that was there was a good move coming. But sort of a shame I missed the top part of wave 3 when I was away from the market on one day. And then missed the top part of this last wave after thinking I could get cute and time a "probable" 5-10% pullback. In the process I missed the 20% majority move in gold stocks at the end encompassing 3 days.
too late to get on board as gold will be moving swiftly as every hedge fund and their brother instantly try to board in the $1040-$1100 range. The price will probably blow right through there in a day or two on its way to $1200-$1400 within a week.
thank you for writing this: "too late to get on board as gold will be moving swiftly as every hedge fund and their brother instantly try to board in the $1040-$1100 range. The price will probably blow right through there in a day or two on its way to $1200-$1400 within a week."
There will be no need for reminders as you'll be well aware of it. Let us know when you're back onboard. MoneyLA, I tried using some of the links off to the left on your website home page but each of the 2 times I tried them (days apart) none of them activate for me. Do those work for anyone else?
Over the previous week the commercial futures ratio increased from the 3.03 warning level to a loftier 3.15 at 353K O/I. Since this data is delayed 1 week, one could estimate Friday's level at 3.30. The number that turned the market on 2/17/09 away from $1000/oz was 3.18 at 376K total open interest contracts.
In looking back at the 2 previous strong runs gold has made the following data is offered for comparison: March 2008: took 5 consecutive weeks at 3.35-3.42 to crack the market with ave O/I at 450K. During the April/May 2006 peak that first took gold to $730/oz, it took 9-10 weeks at elevated ratio's to crack the market with a smaller O/I of only 290K contracts.
Based on the short time frame of the current ratio being >3.0 and with far less open interest than the 1st run to $1000, it's hard to say the current run is expiring, esp. if it intends to run >$1000.
I liked the action from the last few days. Hanging solid in $950, with a brief test to $936 which quickly rebounded back. I think we'll see $990 this week.
Add to that, silver is making a good run this morning to lead the charge.
With the gold/silver ratio touching a new low of 64.0 it does appear that gold and silver are gearing up another short term move. Silver just bounced off $15 while gold hit $960 and pulled back. In counting out the waves this morning it looks like one more wave up is in the cards today. Maybe that will result in something around $970/$15.
The shorts in TRE went running for the hills this morning as TRE closed a majority of the huge gap down originally created from 3.5-4.0. TRE just passed Citi on the race to 5.0.
Gold and silver are making a good move today as we expected. R2 is around $965 and we've breached that level but not yet decisively. I have R3 figured at $977. I can see $970 happening, not sure if we'll get to $977. I still think $990 might be possible for this move, but it's looking more and more likely that we're in for a good correction in the not to distant future, and it will probably be fast and swift. Caution is in order, especially after $970.
I sold all my paper silver a couple of days ago. Looks like I left some money on the table but I have heard the banks are building large short positions.
<< <i>I sold all my paper silver a couple of days ago. Looks like I left some money on the table but I have heard the banks are building large short positions. >>
Do the banks always make the best decisions? Their recent track record is not good.
RR, what's your take here? I keep vasciallating on what to do here. I'm closing my long position here at $970 although I think it may go to $990 in this run. I may buy back in on a dip tonight to $960, but I'm convinced there is a correction coming. I have seen a few writers identify the 3rd weak of June as an important reversal date. It's this reversal date where I'm going to be ready to pour back in for sure, as I think the run to $1300+ will start then.
Other points of consideration: 1. Gold is currently overbought 2. Gold's reaction to the drop in the dollar has been mild - this is kind of bearish, IMO. 3. Gold has had a good run and needs to consolidate to make what many expect to be a sudden, fast push over $1000. 4. The rumors of an IMF gold sale are fluttering around and getting more serious (although I understand that China has already said they'll take it all).
I am slightly concerned about missing out on a push over $1000 within the next few days. A few factors are: 1. The USD continues to fall. It did a Fib 38% retracement from it's drop a year ago, and it could keep falling. 2. Funny business at the Comex regarding delivery on futures contracts. 3. The ever-present "manipulation" factor. 4. The run in silver may be over due to technical factors.
The dollar falling below critical support at 79.8 has opened up another can of whoopa$$ that I didn't expect so soon. I figured we were ready to meander back to 81-82 for a bit. And gold exceeding $970 so soon was unexpected. A couple of the guys I follow see a pull back by June 3/4 and it wouldn't be big. I'm sure the big banks are piling in on the short gold futures right now.
It's hard to want to jump in and try to chase a cascading market upwards right at the levels of all time highs as that usually breeds guaranteed losses. The action in gold from $930 and up got rid of a lot weak hangs by frequent shakeouts and stop buying. I'm sure the commercials were pleased.
The dollar could easily continue to fall from here to .76 or lower. There is really no support for a while. It does seem like we will touch the $990's. I really have no idea today what will transpire after that. There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison.
<< <i>. There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison. >>
RR you "hit the nail on the head" with that statement.
"Bongo drive 1984 Lincoln that looks like old coin dug from ground."
I believe in Stan Weinstein's technical analysis and investing strategy. Here's what Stan might say... and it is what I say:
1. there is nothing wrong with taking profits
2. when everyone turns bullish, it's time to sell
3. if gold doesnt sell off, but continues its move up, and moves to new highs, you can "buy high and sell higher."
Stan was known for putting out "buy recommendations" on stocks and commodities that made "new highs." He would rather buy a stock that is "in the clear" than buy one that faces "over head resistance."
gold is facing overhead resistance at about $1,000. Let gold clear that overhead resistance and prove that it is "in the clear." then you can "buy high and sell higher" too.
with this strategy you wil NEVER buy and make the maximum profit, but you will AVOID the losses that most investors and traders suffer when they buy too soon.
And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember.
<< <i>I believe in Stan Weinstein's technical analysis and investing strategy. Here's what Stan might say... and it is what I say:
1. there is nothing wrong with taking profits
2. when everyone turns bullish, it's time to sell
3. if gold doesnt sell off, but continues its move up, and moves to new highs, you can "buy high and sell higher."
Stan was known for putting out "buy recommendations" on stocks and commodities that made "new highs." He would rather buy a stock that is "in the clear" than buy one that faces "over head resistance."
gold is facing overhead resistance at about $1,000. Let gold clear that overhead resistance and prove that it is "in the clear." then you can "buy high and sell higher" too.
with this strategy you wil NEVER buy and make the maximum profit, but you will AVOID the losses that most investors and traders suffer when they buy too soon.
And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember. >>
Ohhhhhhhhhhh... that is true, but we have never before been in circumstances akin to what we are in now. There will indeed be a "sky is falling" knee jerk spasm to the upside coming. The question is when.
Technical analysis doesn't work on a broken financial system. It is all about emotion, and the world is crying.
<< <i>And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember. >>
It's a pretty reliable ocurrence that 3 or 4 attempts at a level is what it takes to break through it. I see a third attempt coming shortly, with a quick, scary sell-down to shake off the bulls and start to change everyone's mind, right before a sudden move back the other direction with a clear, decisive breach of $1000.
Trying to decide if Gold/silver will go up or down in the next week/2 is foolishness. There are so many big boys pulling in different directions with different goals.
The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move.
Excellent point when you said "The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move."
But do you want to buy gold TODAY because you believe it will be higher in six years, and during the next five years (for example) you are holding your gold and watch it hold in a trading range? Or, do you want to buy your gold after a break out when it is on the move to new highs?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
You want to buy gold when it moves UP, and not when it is holding steady or holding in a trading range. That can be very costly.
<< <i>Excellent point when you said "The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move."
But do you want to buy gold TODAY because you believe it will be higher in six years, and during the next five years (for example) you are holding your gold and watch it hold in a trading range? Or, do you want to buy your gold after a break out when it is on the move to new highs?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
You want to buy gold when it moves UP, and not when it is holding steady or holding in a trading range. That can be very costly. >>
One could say on the contrary, how long to do want to hold fiat money when the risk of it losing value is so great?
and who does, Stocks?? maybe a 2% dividend when the value changes that much in one day or CDs that pay 2-3% interest in a year?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
Are you playing "casino' where you need to see a "win" every morning? Go ahead and keep you money earning 2% and then pick The "exact moment" before the big rise.
The only ones who buy at the exact bottom and sell at the exact top are liars.
Myself I go with the long term trend, trying to trade in perfection is ulcer material
Added:
Actualy MoneyLA i believe we had this same converation a month or so ago when gold was $100 lower. You were waiting for the "bigbreakout" over 1000 at that time. How much dividends or 2% interest would you need to makeup the 100/oz you already missed out on??
It's not explicitely stated, but I think the purpose of this thread (or one of the purposes) is to discuss short term trading. So indeed, catching the next $5-10 move in gold is definitely an appropriate topic.
this doesn't mean that longer term trades can't be discussed. It is important to note that picking a great entry point can make a significant difference in your returns, even for long term plays. For example, if the pullback happens that I expect, you can buy in gold at ~$60 less in a few weeks vs. today, which is 6 or 7% and is nothing to ignore.
I've already stated that $1200 gold is <12 months away, of that I am nearly certain. Heck, analyst Doug Gnazzo has been offering a free subscription to his newsletter if gold doesn't break $1100 this year. That's a nice hedged bet for anyone.
There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison.
Sinclair for one is now saying that we're within a couple of weeks of busting out to new all time highs. Yet a couple of weeks ago he also said that the Comex short bankers position was too large to breech $1000 on this run. So I don't get the switch. The bankers are only another few notches shorter today than they were 2 weeks ago. With interest rates now rising, those $350 TRILL in interest rate swaps start cascading into default, making MBS and CDS losses seem tame by comparison. JPM is the world's largest holder of these at approx $65 TRILL. This while the bankers are still dealing with increasing losses on credit derivatives and commercial RE.
But my concern is not getting the next $10 or $30 in gold, but not missing the next $300 move in gold which could in reality happen any day from now to 12 months. It would stink to have played gold or gold stocks for several years only to be out of them exactly when it matters. And if you just bought and stayed put anytime from last November to January or March to April, you'd have been in the driver's seat. The movers and shakers have made it very difficult for gold or silver buyers to hold in the past few months and esp. in the past few weeks. It's been the same for oil and natural gas as well as other commodities. The volatility has been strong. They shake the tree at just the right time and weak hands let go for fear of losing the 5-10% profit they just got or even worse fall into a temporary 5-10% losing position. Getting cute gets you lost. And waiting after the big move happens will almost ensure that on the first big pullback you will be in a losing position very quickly.
Thomson says our current setup could fall either way hinting that we are at a major inflection point where another massive deleveraging from OTC derivatives could occur. Some potential doom and gloom here to be sure. Gold could go to $1200 or to $700. His biggest fear is the state of the UST bond market. By his accounting the bond market is sucking up huge amounts of capital right now from every source (equities, commodities, etc.)...and nowhere near enough money to buy all the bonds that are being sold. It all comes to a head shortly.
Poised for a good move...perhaps, but it would be much more comforting to watch it sit very close to 980 for a few weeks after a a quick run past a K but maybe that's too conservative of a posture. I am interested to see how this big GM play is going to work out; that should tell us a good bit about what's in play in the market. GM is probably going to be one of the bigger plays for June so it may just pull the cash away from the PM's, not to mention that N. K. is acting up and folk are getting a little tired of that silliness; after all, there's real problems to be worked on like the two state holy land and we have the situation in Africa. Then, again, we could talk about Pak and the tali's and the nuclear capability and the general unrest there anyway, seems like that thing could go critical mass without much encouragement. There are plenty of things that could throw gold well past the 1,000 mark and keep it there, it would seem.
But, there are also strong financial interests playing silver with shorts, miners/producers, funds, PM, equities, even the comex itself; there's a lot of activity in those sectors and they are red hot from all the action after this last week. Something's gotta happen here because there is a ferocious battle going on, it seems, and the marker keeps moving gold and silver higher and it seems inflationary and that's probably not good for a lot of people...there will be resistance to this trend but just how strong are the forces of the dark side? Seems to me that there is a lot in play right now and it's really hard to tell which balls are going to land where. As my dad used to say..."You places your bets and you takes your chances."
"Trying to decide if Gold/silver will go up or down in the next week/2 is foolishness. There are so many big boys pulling in different directions with different goals.
The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move."
Over the previous week the commercial futures ratio increased from 3.15 at 353K O/I to 3.51 at 400K O/I, a fairly big jump. Since this data is delayed 1 week, one could estimate Friday's level at 3.6 to 3.7. The number that turned the market on 2/17/09 away from $1000/oz was 3.18 at 376K total open interest contracts. We're way past that point but only 1-2 wks with a strong ratio in effect. The commercials (ie big banks) increased their short position to 73.3% of total shorts (silver is at 67.2% with a 2.85 ratio). The commericals added 22,762 short contracts while selling off 2309 long contracts.
As a reminder:
In looking back at the 2 previous strong runs gold has made the following data is offered for comparison: March 2008: took 5 consecutive weeks at 3.35-3.42 to crack the market with ave O/I at 450K. During the April/May 2006 peak that first took gold to $730/oz, it took 9-10 weeks at elevated ratio's to crack the market with a smaller O/I of only 290K contracts.
Comments
<< <i>If the current leg stops short of $1000 (not that it must) it will just reinforce in the minds of all fiat/credit lovers once and for all that gold is a complete and total bust and waste of time and money. Unfortunately this will be the exact wrong time to be thinking that. On the next swing up it will be too late to get on board as gold will be moving swiftly as every hedge fund and their brother instantly try to board in the $1040-$1100 range. The price will probably blow right through there in a day or two on its way to $1200-$1400 within a week. Those that joined late will get shaken out on a violent move back down to $1000 or lower to place them into a big loss position. And once shaken out, gold will rebound and leave more people in the dust unwilling to pay even more money to be able to get back on board. >>
that is true. Gold tends to behave in a way that it takes off just as all but the perma-bulls lose faith. A rise up to $970-1000 followed by a swift correction to the low $900's would be a good way to accomplish this. Once it takes off, people waiting for a dip to buy back in will be disappointed at the lack of opportunities.
The stock market is also still in a bull run. I'm still expecting the S&P500 to recover back to at least 1050.
Regarding on topic, you got it. I'd be very disappointed if this thread was lost due to off topic discussions, and especially if caused by me.
Its just hard at times to see the obvious being danced around while other less threatening items are targeted.
At least I had one thing right for May, and that was there was a good move coming. But sort of a shame I missed the top part of wave 3 when I was away from the market on one day. And then missed the top part of this last wave after thinking I could get cute and time a "probable" 5-10% pullback. In the process I missed the 20% majority move in gold stocks at the end encompassing 3 days.
roadrunner
too late to get on board as gold will be moving swiftly as every hedge fund and their brother instantly try to board in the $1040-$1100 range. The price will probably blow right through there in a day or two on its way to $1200-$1400 within a week.
I think you are right on with this...
please remind me when it happens.
thanks
www.AlanBestBuys.com
www.VegasBestBuys.com
5/19/09 Gold COT futures report
Over the previous week the commercial futures ratio increased from the 3.03 warning level to a loftier 3.15 at 353K O/I. Since this data is delayed 1 week, one could estimate Friday's level at 3.30. The number that turned the market on 2/17/09 away from $1000/oz was 3.18 at 376K total open interest contracts.
In looking back at the 2 previous strong runs gold has made the following data is offered for comparison: March 2008: took 5 consecutive weeks at 3.35-3.42 to crack the market with ave O/I at 450K. During the April/May 2006 peak that first took gold to $730/oz, it took 9-10 weeks at elevated ratio's to crack the market with a smaller O/I of only 290K contracts.
Based on the short time frame of the current ratio being >3.0 and with far less open interest than the 1st run to $1000, it's hard to say the current run is expiring, esp. if it intends to run >$1000.
roadrunner
I havent had any other problem reports. If anyone is having a problem, please let me know what it is.
thanks.
www.AlanBestBuys.com
www.VegasBestBuys.com
Add to that, silver is making a good run this morning to lead the charge.
The shorts in TRE went running for the hills this morning as TRE closed a majority of the huge gap down originally created from 3.5-4.0. TRE just passed Citi on the race to 5.0.
roadrunner
Looks like I left some money on the table but I have heard the banks are building large short positions.
<< <i>I sold all my paper silver a couple of days ago.
Looks like I left some money on the table but I have heard the banks are building large short positions. >>
Do the banks always make the best decisions? Their recent track record is not good.
Other points of consideration:
1. Gold is currently overbought
2. Gold's reaction to the drop in the dollar has been mild - this is kind of bearish, IMO.
3. Gold has had a good run and needs to consolidate to make what many expect to be a sudden, fast push over $1000.
4. The rumors of an IMF gold sale are fluttering around and getting more serious (although I understand that China has already said they'll take it all).
I am slightly concerned about missing out on a push over $1000 within the next few days. A few factors are:
1. The USD continues to fall. It did a Fib 38% retracement from it's drop a year ago, and it could keep falling.
2. Funny business at the Comex regarding delivery on futures contracts.
3. The ever-present "manipulation" factor.
4. The run in silver may be over due to technical factors.
It's hard to want to jump in and try to chase a cascading market upwards right at the levels of all time highs as that usually breeds guaranteed losses. The action in gold from $930 and up got rid of a lot weak hangs by frequent shakeouts and stop buying. I'm sure the commercials were pleased.
The dollar could easily continue to fall from here to .76 or lower. There is really no support for a while. It does seem like we will touch the $990's. I really have no idea today what will transpire after that. There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison.
roadrunner
<< <i>. There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison. >>
RR you "hit the nail on the head" with that statement.
1. there is nothing wrong with taking profits
2. when everyone turns bullish, it's time to sell
3. if gold doesnt sell off, but continues its move up, and moves to new highs, you can "buy high and sell higher."
Stan was known for putting out "buy recommendations" on stocks and commodities that made "new highs." He would rather buy a stock that is "in the clear" than buy one that faces "over head resistance."
gold is facing overhead resistance at about $1,000. Let gold clear that overhead resistance and prove that it is "in the clear." then you can "buy high and sell higher" too.
with this strategy you wil NEVER buy and make the maximum profit, but you will AVOID the losses that most investors and traders suffer when they buy too soon.
And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember.
www.AlanBestBuys.com
www.VegasBestBuys.com
<< <i>I believe in Stan Weinstein's technical analysis and investing strategy. Here's what Stan might say... and it is what I say:
1. there is nothing wrong with taking profits
2. when everyone turns bullish, it's time to sell
3. if gold doesnt sell off, but continues its move up, and moves to new highs, you can "buy high and sell higher."
Stan was known for putting out "buy recommendations" on stocks and commodities that made "new highs." He would rather buy a stock that is "in the clear" than buy one that faces "over head resistance."
gold is facing overhead resistance at about $1,000. Let gold clear that overhead resistance and prove that it is "in the clear." then you can "buy high and sell higher" too.
with this strategy you wil NEVER buy and make the maximum profit, but you will AVOID the losses that most investors and traders suffer when they buy too soon.
And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember. >>
Ohhhhhhhhhhh... that is true, but we have never before been in circumstances akin to what we are in now. There will indeed be a "sky is falling" knee jerk spasm to the upside coming. The question is when.
Technical analysis doesn't work on a broken financial system. It is all about emotion, and the world is crying.
<< <i>And remember, we have been at these levels before only to have two rally failures at the 1,000 level. Remember. >>
It's a pretty reliable ocurrence that 3 or 4 attempts at a level is what it takes to break through it. I see a third attempt coming shortly, with a quick, scary sell-down to shake off the bulls and start to change everyone's mind, right before a sudden move back the other direction with a clear, decisive breach of $1000.
The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move.
But do you want to buy gold TODAY because you believe it will be higher in six years, and during the next five years (for example) you are holding your gold and watch it hold in a trading range? Or, do you want to buy your gold after a break out when it is on the move to new highs?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
You want to buy gold when it moves UP, and not when it is holding steady or holding in a trading range. That can be very costly.
www.AlanBestBuys.com
www.VegasBestBuys.com
<< <i>Excellent point when you said "The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move."
But do you want to buy gold TODAY because you believe it will be higher in six years, and during the next five years (for example) you are holding your gold and watch it hold in a trading range? Or, do you want to buy your gold after a break out when it is on the move to new highs?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
You want to buy gold when it moves UP, and not when it is holding steady or holding in a trading range. That can be very costly. >>
One could say on the contrary, how long to do want to hold fiat money when the risk of it losing value is so great?
and who does, Stocks?? maybe a 2% dividend when the value changes that much in one day or CDs that pay 2-3% interest in a year?
Remember, gold does not pay interest or dividends, so if you buy it for the long term, without constantly rising prices, you are in fact losing money.
Are you playing "casino' where you need to see a "win" every morning? Go ahead and keep you money earning 2% and then pick The "exact moment" before the big rise.
The only ones who buy at the exact bottom and sell at the exact top are liars.
Myself I go with the long term trend, trying to trade in perfection is ulcer material
Added:
Actualy MoneyLA i believe we had this same converation a month or so ago when gold was $100 lower. You were waiting for the "bigbreakout" over 1000 at that time. How much dividends or 2% interest would you need to makeup the 100/oz you already missed out on??
this doesn't mean that longer term trades can't be discussed. It is important to note that picking a great entry point can make a significant difference in your returns, even for long term plays. For example, if the pullback happens that I expect, you can buy in gold at ~$60 less in a few weeks vs. today, which is 6 or 7% and is nothing to ignore.
There are too many bullish analysts starting to call for $1100-$1300 right now. In past runs this is about the point where the market gets turned back. Pick your poison.
Sinclair for one is now saying that we're within a couple of weeks of busting out to new all time highs. Yet a couple of weeks ago he also said that the Comex short bankers position was too large to breech $1000 on this run. So I don't get the switch. The bankers are only another few notches shorter today than they were 2 weeks ago. With interest rates now rising, those $350 TRILL in interest rate swaps start cascading into default, making MBS and CDS losses seem tame by comparison. JPM is the world's largest holder of these at approx $65 TRILL. This while the bankers are still dealing with increasing losses on credit derivatives and commercial RE.
But my concern is not getting the next $10 or $30 in gold, but not missing the next $300 move in gold which could in reality happen any day from now to 12 months. It would stink to have played gold or gold stocks for several years only to be out of them exactly when it matters. And if you just bought and stayed put anytime from last November to January or March to April, you'd have been in the driver's seat. The movers and shakers have made it very difficult for gold or silver buyers to hold in the past few months and esp. in the past few weeks. It's been the same for oil and natural gas as well as other commodities. The volatility has been strong. They shake the tree at just the right time and weak hands let go for fear of losing the 5-10% profit they just got or even worse fall into a temporary 5-10% losing position. Getting cute gets you lost. And waiting after the big move happens will almost ensure that on the first big pullback you will be in a losing position very quickly.
Trader Stewart Thomson on how to deal with teetering on the precipice
Thomson says our current setup could fall either way hinting that we are at a major inflection point where another massive deleveraging from OTC derivatives could occur. Some potential doom and gloom here to be sure. Gold could go to $1200 or to $700. His biggest fear is the state of the UST bond market. By his accounting the bond market is sucking up huge amounts of capital right now from every source (equities, commodities, etc.)...and nowhere near enough money to buy all the bonds that are being sold. It all comes to a head shortly.
roadrunner
But, there are also strong financial interests playing silver with shorts, miners/producers, funds, PM, equities, even the comex itself; there's a lot of activity in those sectors and they are red hot from all the action after this last week. Something's gotta happen here because there is a ferocious battle going on, it seems, and the marker keeps moving gold and silver higher and it seems inflationary and that's probably not good for a lot of people...there will be resistance to this trend but just how strong are the forces of the dark side? Seems to me that there is a lot in play right now and it's really hard to tell which balls are going to land where. As my dad used to say..."You places your bets and you takes your chances."
"Trying to decide if Gold/silver will go up or down in the next week/2 is foolishness. There are so many big boys pulling in different directions with different goals.
The real question is where do you expect it to be in 6 month or six years and not to get caught out of it by trying to profit on some 50 cent move."
It would be hard to say it better than that...
As a reminder:
In looking back at the 2 previous strong runs gold has made the following data is offered for comparison: March 2008: took 5 consecutive weeks at 3.35-3.42 to crack the market with ave O/I at 450K. During the April/May 2006 peak that first took gold to $730/oz, it took 9-10 weeks at elevated ratio's to crack the market with a smaller O/I of only 290K contracts.
roadrunner