See I think stopping price just a hair under those big targets (1500 and 300 AGQ) was fascinating. Everyone was expecting those levels to take profits and now folks are staring at huge reversal candles wondering what to do.
This is going to be a real ugly intraday reversal if we close down. Will be a great buying opportunity in a few days though. Congrats to those who sold the news this morning.
Once again, a bull market will have only one correction that exceeds 10%. We had that correction last summer in the S&P 500. So unless we go below 1209ish, the market is just making a new base for the next move higher. We don’t even have a lower low below 1249 yet and folks are calling for a bear market. Especially after some were calling for new highs just a few days ago. Talk about getting control of one’s emotions. I don’t trade fundamentals BTW. 🙂
New York: I did a lot of trimming last week (maybe more than I should have). Am now “eagerly” awaiting a correction so I can put all my money at risk. 🙂
PC: Yes still long. I only own AGQ now (sold virtually all my miners and SLW a good while ago into strength—got a little lucky to catch the highs) I have been afraid that we might be in the final blow-off stage and am so far ahead I thought I’d sit with about 30-40% of where I want to be in AGQ. Looking forward to the coming bottom.
Gary is still expecting that we haven’t seen the top of this cycle yet. The target was $1,500 on $Gold, maybe a little higher. That’s why he is waiting to see if today’s action is for real or a fake out. That’s the way I interpret his thinking.
A big reversal in silver would likely mark the top. We won’t know if we have actually reversed lower until we close. I will probably lighten up a little further as well. I think that’s a fine thing for people to do IF they are willing to buy on strength if they/we miss the bottom. And IF they won;t get scared and fail to add at the bottom waiting for a “little but more of a decline.” If you might balk at either of these, don’t get so light that you will kick yourself if they take off again without you.
The weakness expected will be quite shallow, since the lower BB is rising fast, and the dollar is rallying hard as is… should be over by week’s end, and will probably bottom in the 1440-1450 range.
torero, If you had read the weekend report you would know that the coil pattern should reverse to make a new high. It has failed. That’s a bad sign.
If the market drops below the Japan bottom we will have a left translated a failed intermediate cycle. That is a sign of a bull market top.
This is why I don’t depend on charts and why cycles work so much better. I will have spotted the bear market long before your charts tell you that you are in trouble.
The market has broken below the half cycle low. That is a bad sign. If I had money in the stock market (I don’t) in an IRA I wouldn’t be waiting around any longer.
We are now in the timing band for the secular bear to return. It’s too risky to continue to hold this far into a cyclical bull market. The potential upside is too small and the downside risk to great especially with the market not acting like it should be if it were going higher.
I am getting close to a buy signal on SLW. One more bad day ought to do it. If it comes anywhere near the timing band for a gold bottom I will be forced to buy it (can you see the gun at my head?) Heck, even on a reversion to mean basis it ought to rally having been so trashed. By the time something shows up on my buy screen it is very seriously overdone on the downside. It will bounce, I’ll put in my break-even stop, and we’ll see if it can get legs. For you option guys interested in taking a shot, it’d probably be a good call play. I will post if I get the buy on it.
No, my sacrificial trade has not been made yet! My finger is poised on the trigger though. It will be a very small amount of my equity if/when it is made.
Ideally, silver’s weakness grows throughout today. I’ll see where we are at the close.
Gary, The SPX essentially went straight up for 5 1/2 months. So far, all we are seeing is a healthy correction of that powerful move. The market is acting like it should. For us to continue higher, the market needs to load the bear boat again. I am mostly flat equities and will wait for confirmation the correction is over before entering new swing long positions. Selling pressure has not increased and buying pressure has also been muted. Classic sideways consolidation. Again, if we were to enter a bear here, critical levels will be broken and I would be ready to short the first powerful retrace. I absolutely will never front run a bear market. That’s suicide.
Thanks again for your great, helpful posts. I enjoying following your trades and the reasons behind them, you are providing all of us with a great education.
Same goes for TZ, Alex, Poly and the other experienced traders.
You input, combined with Gary’s premium content, has helped me to dramatically improve my PM investing returns over the past month.
Gary: Unless I am misunderstanding something, when you say something like you said this morning: “The dollar cannot have bottomed yet because it hasn’t formed swing low” you mean it hasn’t finished the bottom formation series of prints. By definition the actual low must be lower then the point at which swing low is established because it’s a rally that establishes the swing low. The dollar bottomed this past Thursday (that is, if you call the low the bottom). Today, I suppose, confirms it in retrospect. For myself, I’m glad I didn’t wait to buy EUO. I have found I am usually not buying at the swing low signal and instead buying when I see what looks like an actual low print to me.
DG or Mr miyagi, Would either of you wait for a swing high in gold before entering a position in SLW? Would a swing low be the final confirmation of a buy signal?
Michael: I myself usually don’t pick prices. I find it is better to let the market tell me what to do. Gary is right, the obvious prices are usually violated to run the stops, get a little panic going, and then reverse higher. 40 of course could hold, but it may bottom at 41 or 39 just as easily in my view. If I had to pick a price I’d pick 38—the March bottom and where my buy would likely hit. If I get the buy and we are at 38 I will definitely buy it, but without my buy for me it’s just a guess and not worth betting on.
I think Beanie is out refinancing his house so he can keep holding his favorite group of semiconductor stocks. Man, I was short SMH at the top (36.50) but wasn’t convinced enough to just hold it. Next time I might take fading Beanie more seriously. Dow 30,000 here we come! If we really are toast I look forward to shorting, but my primary attention and capital now is on getting the next gold daily cycle low. Once the C-wave ends we’re going to have fun on the downside. Alex, I’m gonna get you short, my friend! They go down a lot faster than they go up.
You said earlier today that the stock market has broken below the half cycle low. Why couldn’t today’s low end up being the half cycle low? (And the 4/14 low was just one of several lows on the way down to the half cycle low.) Or, if we go lower tomorrow, then tomorrow’s low could turn out to be the half cycle low?
Seems like we can’t know for sure until we see what the market does from here. If today’s low holds, then today’s low will turn out to be the half cycle low, right?
In Demark land today, DXY is responding to its 1-4 Bar Buy Setup on Day #4. Kevin Depew in “Five Things you need to know: US Credit Downgraded by S&P” sez: “After all, did the S&P futures not just drop 10 points on ‘news’ of the S&P downgrade? Sure, but the long-term patterns of markets reveal in time that such apparent exogenous factors are a bit like gnats biting a buffalo. In my DeMark analysis, the US dollar needs a new low, below 72, and possibly even a move below 70, crossing the round to help foster more dire headlines and warnings. After that , it will be over.” So, it appears that Depew is lining up more with Gary’s chart from his weekend report, so DXY 72.5 may not be such a line in the sand after all. However, I don’t agree with Gary’s chart that DXY will probably not go back much more over 80 – if we’re looking at the return of the bear, DXY pushed 90 two times in the last 3 years – at least give it that… Depew also looks at silver again in his “market notes” of the Buzz and Banter. Not much new, but here goes: DAILY: Minimum requirement for wave 5 up has been met, but we are only on Bar 4 of potential Sequential 13 Sell (minimum of 9 days) Next TD Absolute Retracement target up at 45.32 WEEKLY: Weekly has met minimum requirement for Wave 3 up as well. TD Sequential 13 Sell signal occurred the week of April 1, but the upward momentum continues. MONTHLY: This month is bar 12 up of a potential TD Sequential SELL signal QUARTERLY: This quarter is bar 8 up of a Sell Setup and bar 10 of a Sequential 13. YEARLY: This is bar 9 of a Sell Setup which will record – 1-4 year downside reaction forthcoming Depew reiterates that he is making sales this year because he believes the long period of metal outperformance is ending, but remains a long-term silver bull, especially versus gold.
Please excuse me i may be missing some fundamental pont here, but if the dollar has posted a half cycle low and is now turning up shouldnt that put additional pressur eon spot gold which in turn would result in increased selling pressure on gold miners particularly those with the greatest spot exposure
on April 19-20 in history: — Start of Revolutionary War — Battle of San Jacinto — Start of Civil War — Start of Mexican-American War — Start of Spanish-American War — America abandoning the Gold Standard (not the Nixon one) — Failure of Bay of Pigs Invasion — End of Viet Nam War — Largest battle of warships since WW II — Explosion on USS Iowa — The BP Oil Spill in Gulf of Mexico
ahain: I agree with you. I do not believe the miners have bottomed yet. Heck, silver has been down for only three hours! We ought to have at least a couple of days where the metal and the miners are both down, but we’ll soon see.
Shouldn’t we wait for the daily cycle low in gold to form? If the miners hold their current lows while the metals dip down, that would be a positive divergence and a sign to get back in. Of course, they could always drop lower.
I don’t get the impression that folks are buying just yet. Some have looked at the miners and are salivating a bit.
I have to wonder about the metals, though. What will cause them to go down for more than a few hours (other than the climax top of the parabolic move)? So I wonder whether we will get a recognizable daily cycle low at all.
DG, im waiting for the fear factor to kick in, it still looks a little too comfortable to be on the long side right now. Probably a good time to look for some cheap mining stocks. The question is given the C – wave, it would probably be better to pick outperformers rather than underperformers. If we were at teh start of teh move my preference would be underperformers, but at this late stage surely we have to stick with the Silver Wheatons. What do you think?
I’m re-establishing my positions in the miners, I’m buying strong sell off days all the way down.
SLW is way over sold.
Miners may have sniffed out the daily cycle top and they may sniff out the low. I’m looking for a very strong rebound the final daily cycle in the miners and for them to lead up out of the correction.
I see limited downside here for many of the tickers I follow so I added a % of my target allocation.
Sophia: I have no idea why people are buying today, but I assure you it’s not “everybody.” SB waits for weakness as do I. I bet neither Poly nor Alex are buying today either. One of the great things about this board is that you slowly find the people you want to emulate. Poly’s SPY purchase last week helped nudge me into buying as well. [I hope he sold when I did though 😉 ]
dumamae – if you have to ask, you’re not ready to buy options.
that said, it’s never too late to learn. there are many free options tutorials available out there. gary also discusses his particular options strategies on the subscriber site.
As in the stock is 50$ and you buy 42$ calls. A 48/49$ call would be in the money. A 51$ call is out of the money. A 60$ call expiring within a month is a lottery.
I agree with you that considering the price action, I would not touch it, but there are so many comments talking about itchy fingers that it makes me wonder…
ahain: For myself I am sticking with AGQ and SLW if I get my buy on it. I will post other names if/when they show up on my screen. The which is better, and underperformer or overperformer is a good question. I’m afraid it’s one of those things I do by feel at the time. Either can work well.
DG I’m not buying yet either. However I do remember Jayhawk was among the few who bought AGQ not to long ago at 130 as it bounced off the 150dma. I know enough to know I really am not good at this so I will just wait for Gary to add his options on SLV, that will be close enough to the bottom for me.
DG. Effective Volume may help with the stock picking. More here http://www.effectivevolume.eu Im not plugging its not my site and they charge however at monest.net http://www.monest.net/charts/ they have a free charting package they have a free online charting tool where you can select these EV indicators. Fundamentals, relative strength dont work, the EV tool helps me to see where big money (big volume) is placing their bets.
ahain: Thanks. I have been meaning to put more energy into studying volume, but I keep not doing it so I guess I am not interested in opening up a new area of study for myself. Too old I guess. I mostly spend time looking for my dentures. (That’s a joke, by the way. I played eight hours of volleyball this weekend, so no wheel chair for me quite yet.)
Wow, 8 hours. I spent 8 hrs digging a trench for hedging. Luckily my fingers are the only part of my body i can still move without too much discomfort.
Just as a side note, Goldmans report tomorrow, some of teh financials are looking strong. We could see the equities take off here led by financials which could add to the gold argument (weakness)
Those 2 and SLW I picked up today. But remember I was looking to build back a position after over scaling out. Of course we will go down further and I will just keep averaging in on the way down this daily cycle low. I can’t afford to be hand sitting if this thing decides to do what TZ thinks. (runaway)
This kind of reminds me of the QE2 announcement day on Nov 3rd. Deep into the intermediate cycle, gold and silver looked very stretched, people calling for a corrections, “sell the news”, was going on. The day looked like a sell the news event, but the reversed the losses and then we went on to launch to new highs over the coming days/weeks.
Jayhawk, I’m holding SLV and SLW cals, just waiting for the drop to finalize purchases. If it doesn’t materialize for some unprecedented reason, I’m placed to make money.
Today’s action started off great but is getting a little frustrating. Sure hope we finish down otherwise this could very well be a runaway move and we simply continue higher tomorrow.
May be forced to buy back what I sold early this morning.
Shalom Bernanke (and he should correct me if I’m wrong) said he was looking to buy miners if the .HUI got down to 565. Well, it bounced smartly off 566 this morning.
I’m not messing with miners much (90% AGQ with some NUGT and SLW calls) but those who are should be interested in that.
I wish more people like TZ were calling for a runaway move..haha
when everyone out there is expecting a correction (despite the sentiment),a run-away move sure seems possible (like TZ was mentioning) followed by a 25% drop in one day
wish Gary was the only one expecting a correction…unfortunately, the whole blogosphere is looking for one
The argument has been that a rising dollar should bring down the PM but as we can see, in the past 2 days the PMs have risen alongside the dollar so it isn’t perfectly negatively correlated. Plus in the past, the two have risen together for extended periods of time. Only time will tell as always….
You’re correct, that level sounds good, but remember price levels are secondary to price action (direction) in my trading.
What I mean is that when miners were acting well and in tandem with the metals, I would jump all over the 565 HUI level, as well as not selling anything. However, last week forced me to dump my positions because of the divergence, with my holdings exhibiting relative weakness except for 2 positions.
Today is showing this again, with silver up and most miners getting hit. I’d be happy with these prices, but only if miners can get in gear with the metals. Since I’d like to see this happen for a few days, I have not jumped in as yet.
I’ll be back in the miners no doubt, but it’ll also be for shorter hold times (like 1-2 weeks per trade) now that we’re later in the C-wave and I’m seeing sloppy divergences.
I’ll be sure to post when and what I buy, but for now am waiting for clarity.
Gary/Others, I know this is usually not how cycles work, but what do people expect as a catalyst to get some sellers in the PM market? I know that Gary always talks about overbought conditions and sentiment, but what do you think it will take to get some selling momentum in PMs this time. I assumed an agressive move in the dollar would encourage some selling, but it looks like investors are still holding strong and there are plenty of buyers stepping in at these levels. Is this a rotation from institutional to weaker retail hands, which is forming a base for panic selling if/when prices start to move lower?
This strength in the metals is quite something. Each dip is being bought. Gold is forming another micro ascending triangle which if it breaks out will take it to the 1518 range.
However the sentiment here can be described as nervously bearish for the very short term as it has been since last Monday.
The question still is – are we on day 24 or day 4 or a runaway move?
While, we can still have a 28 day cycle with a decline in the next 4 days, everyone here seems to have already sold and are antsy to buy back. So we are early as we expect to be, but with everyone wanting to buy back, I doubt we will get that multi day dramatic decline. 36 seems way too far from here.
Were you guys expecting S&P to downgrade the United States today? I sure wasn’t and I’m a hard core PM guy who reads and listens to everything. Now think about how the market is going to digest this news…Go long USD or bonds? Long stocks? Where’s the money gonna go?
If the miners close near the highs of the day and form long tails today, its very bullish. However, I doubt they will go up in front of a decline in metals.
Either this is just a head fake in the miners, or they are indicating metals will continue to go up.
Jayhawk, The rotation into metals today makes sense to me. What surprises me is the strength in the dollar.
I was thinking that we’d get the dollar bounce this week, and that would be the “catalyst” for the smart money to take profits. That’s why I’m wondering if people jumping on board now are the weaker hands which will be dumping at the first sign of a move down.
I agree with Gary’s early point that the likely top will come when everyone can’t stand the pain of being out, so I’m wondering if this is the final panic into the market. Judging by some of the comments on the board today, it seems like even the “informed” group here is being tempted to jump back in.
The FED could have been ready for this announcement ahead of time and they could be the ones buying dollars bending the scenes to prevent a panic sell off.
I think that the dollar strength today is more a function of euro weakness, so we’re currently the tallest….um, “little person” in the room. I should have clarified and stated that I’m surprised by the corresponding dollar and PM strength together. I guess that I was hopeful that the dollar bounce would be the catalyst for the anticipated correction in the metals. I guess a little more patience is warranted to see how this thing plays out over the next week or so.
The Reason For Geithner’s Weekend Media Whirlwind Tour: White House Learned About S&P Downgrade On Friday
And for the most unsurprising news of the day, Reuters reports that the White House has admitted it knew about the S&P rating action on Friday. Which means that all the key bond buyers (or sellers are the case may be, Pimco), knew at roughly the same time what the key market catalyst on Monday would be (we can’t wait to get a declassified glimpse of Larry Meyer’s phone log over the weekend one day in the future). Which also means that today’s action was a strawman in which the big boys merely waited for an opportunity to buy bonds are lower prices, which the ongoing European collapse merely facilitated.
>The FED could have been ready for this announcement ahead of time and they could be the ones buying dollars bending the scenes to prevent a panic sell off.
The white house admitted of knowing about the downgrade on friday. Which means the fed and all the ‘boys’ in NY knew it as well.
They were ready and slammed down everything afterward (as well as Moody’s coming out and saying they thought everything was fine and the US was is good fiscal shape.)
Same manipulation games.
(You can track the stories on zerohedge if you want.)
DG, it is when you get a first hour spike on a position and then it rolls over lower, tracing out a porpoise nose. Typically signals weakness in coming days.
essentially a credit downgrade means that our nation is (in the eyes of S&Ps) one step closer to default. a nation defaulting on it’s debt is one of the most deflationary events that can happen. it is a massive collapse in the supply of money and credit, and we know that fewer dollars chasing the same amount of goods = lower prices and thus the market buying dollars on a day like today make sense. simple as supply falls, demand rises.
however, when you have the fed trying to fight this cycle by infusing the banks with cash, you first get all this debt washed away by default, followed by hyperinflation almost over night.
this currently is the path we are on, which why metals in the long run are the smartest choice. however dollar waves of dollar strength does play nicely into my theory.
If you look at Pimpco’s holdings prior to Fed announcements, they have perfectly frontrun both QE1 (bought MBS) and QE2 (bought 2-10yr. treasuries). They did so with considerable leverage to, which Pimco usually doesn’t do. It’s too bad that they have 45 days to file their SEC documents, or you’d be able know exactly what the Fed was planning to do in advance.
The buying is relentless. Can you imagine the panic selling with a 3$ drop? After that, you have to wonder how many will have cold feet to jump back in and how many more will pour cash in because they’re convinced it will climb forever.
If it is the smart money trying to exit, they have an overhang in the 1496-1498 range. Thats the top of the ascending triangle I mentioned earlier. It continues toward its apex with 5 attempts and an ongoing march for a sixth attempt. With so many attempts, its likely to overcome that resistance and go above 1500 toward 1518.
If it does break out, I am not sure its smart money thats selling here. They make come in later though. Also no GLD on SoS list, SLV is #6 with 9.8M and 6.7M block trades.
1) This is week # 5- highest probability for a cycle top.
2) Also April 26th (next Tuesday) is Metals Options Expiration. Furthermore, my understanding is that it may till Thursday of next week for options to clear out (per James Turk mentioning during last month’s expiration).
So we have quite a while for volatility to calm down…top may not be this week necessarily
YLD, you may be right, but I have a lot of profitable options that I am protecting / taking profit on. The last daily cycle low ripped the premiums from the options, and with us so late in the cycle on a low volume week, my suspicion is smart money is selling today to enjoy their Seders and Easter breaks.
The reason I came up with those possibilities is that today would have been a perfect day to begin the move down into the daily cycle low. Strong dollar rally and we’re very late in the cycle.
Because it has not happened–instead gold and silver look like they will close on their highs–that leads me to believe it’s not going to happen.
In that case, BLH, I agree with your action. I don’t like the drops in the premiums either and got out of all options over the past three weeks. I am now scaling in with futures only.
Bob: Thanks. I’d have thought a close at the highs would invalidate the reversal from the first hour spike.
Re gold: Interesting. Another decent up day tomorrow and I will probably get a sell on gold. The only other one I have gotten this year was on 4/8—the day of the recent high before that pretty stiff two day drop. (the previous one was at the top in November) This would also fit with gold poking its nose about 1500. Maybe today’s recovery will suck in the last of the “it’s never going down again” crowd. Waiting…waiting…
Next week is Last Notice Day for gold and silver futures (April 27). Seems like every month around this day gold and silver get hammered. So maybe the take down will happen early next week.
But the behavior today would suggest that whatever move down we get next week (if any), it won’t be much.
I agree that its a higher probability (60%?) that a runaway move or a new cycle is underway and have been saying it the past 3 days. However, as I posted earlier today, we still have 4 days in which to have a decline. It may not be a large decline, but the daily cycle low can still happen this week. I leave it up to cycle specialists to call it when they see it.
I know we have seen day after day after day of gains on gold & silver but my gut tells me that it will go down. Unlike my gut, which needs a few situps and some cycling to retreat.
These hammers are most amateurish. Infact closes in the green only reinforces the selling on strength that my tape reading is confirming. Even a gap up tomorrow would be a great point to exit longs.
So we are just about to the point where Gary said he might sell some … Do we have the indicator he was looking for? I don’t know enough about the charts to see for myself.
A “tail” refers to the way a candle on a candlestick chart looks on a day like today. If you look at today’s candle or gold, silver, or some of the miners, you’ll see the body of the candle near the top and it’s small. Below the body is a long wick or “tail”.
(Not sure where the “tail” terminology came from but it’s widely used. They are candlestick, so the part outside the body–above and below–should be called wicks. But few people call them that.)
Pima, Your much more experienced at this than am I, but isn’t this the type of action that you would be expecting before a “scary” correction. If we need to have overbought conditions and extreme bullish sentiment, then I would think that we’d need this final “it’s not going down” sentiment. Judging by the comments on this board, people were far too complacent and willing to wait last week, while now people are getting concerned that it’s running away without us. My gut says that once everyone here concludes that we have a runaway market, well that’s about the time it will roll over.
Can someone please elaborate what the reliability of reversal candle may be & how Gary’s play: selling 10 pcnt more AGQ and replacing those with DITM calls ( in what?) would juice his returns? This must be overly tricky / risky/ complicated or all of those, for newbies…..? Would same logic hold: lighten up on AGQ and buy back more after dip? THANK$
Makes sense. Maybe next week will let enough time pass to get everyone on board the not-gonna-get-a-correction bus and then we tank, just in time for Last Notice Day.
Silver back near all time highs, but no breakout for Gold from the ascending triangle…we have to wait to see the result after regular hours. Very low volumes compared to the first third of the trading session though.
Matrix, my guess is Gary has discovered as I did that a big AGQ position takes a lot of capital and you can invest just as heavily with calls for a lot less money in SLV or maybe another instrument.
Matrix, Gary is unloading AGQ because; 1) He’s made a ton of profit on it and 2) The volatility and spread as we get closer to the C-Wave burst will be quite high.
It is my understanding that he will purchase SLV calls.
The ideal would be to sell AGQ and then buy SLV calls with silver at a lower price than where it was when you sold AGQ.
For the same money that you spend on 100 shares of AGQ, you can buy 30 DITM SLV calls! Talk about leverage!!
I would be surprised if Gary goes anywhere near that kind of leverage. But with his small reduction in his AGQ position, he might take those funds and lever it 10 to 1 in SLV. AGQ is 2 to 1 over SLV, so having a small part of his AGQ funds working at 10 to 1 (or some number greater than 2 to 1) will give him a little more leverage without having to increase his margin.
Pima, I’m just playing devils advocate here, and concede that your two scenarios are very possible…even probable. I’m just hopeful that we aren’t seeing the final run.
I keep trying to figure out price levels that would freak out weak hands. Since gold is the driver of the whole PM sector, this chart by Dan Norcini is appropos:
Seems to me if gold dipped down below $1480 it would run a lot of stops. It wouldn’t bounce off 1480, of course, it would probably get to $1474 or something, just to really make people nervous.
Then we could see it rocket to $1500 in the overnight, and the final leg of the C wave would be underway. Skeptics would think “oh, well, it broke $1500, a nice round number, so that’s the top.” Or maybe “oh, it finally broke $1500, it needs to take a breather for a few weeks.” But it would just go vertical from there, leaving them to chase.
Hilson Indicator update. (My PM buddy who flips out near bottoms and starts sending me irate emails. The strongest I’ve seen this indicator is when he is ready to sell all his metals as well. I’ll keep you abreast.) 🙂
Just got these 2 emails from him-
1. selling half of SIL at 30 have had enough with “stocks” totally f-ing rigged…….
2. it’s so unbelievably obvious that the pig bankers are shorting the mining etfs and not the individual stocks!! SIL down more than SLW and SVM
Added just a handful of SLW, thought about GDX but in the end I was playing a video game and let it slide. Que sera sera, down day tomorrow I will buy, up day, I got other stuff.
If this is a runaway move then we’ve only got a few days to a couple weeks before the D-wave hits IMO. I will be looking for entry points for shorts within a week if we keep storming higher like this, with a top somewhere just under 50.
Whoa, Dan. I do not see a runaway move here, not yet anyway. Maybe we should wait to see if the correction can work its magic first; I believe the talk of a runaway move right now makes a correction more likely.
If we keep going up at the right we have been for another week u can forget about a “correction”, it will lead to a full blown crash. We are nearing all time records for the POS relative to 200mva. A few more up days and everyone will be flooding into silver chasing it IMO.
Well, Dan, I hope you are wrong, only because I would love to see a correction before the finale. 🙂 I have some dry powder that I am itchy to use, but not so itchy that I’ll buy with Gary still anticipating a cycle low.
Hey, Gary! Having just cycled through another Canadian winter (in Toronto, tho’, where it’s not SO cold), I am wondering whether you are stocking up on really good socks for the ‘Horn. Personally, all I want to see right now(other than a silver price correction) are spring flowers and warm sun!
I guess that we should see some selling on Thursday as the markets are closed for 4 days in Europe and people could be worried about a strong intervention by the ECB
Eamonn: If I remember you bought some ZSL last week. I have made more errors than I can count, but I try (try) to learn from each one. If I remember, you shorted silver because it was “up a lot.” This is a terrible reason to short something. Shorting something that is “acting better than it should” or because “a correction is due” is one of the very best ways to lose money. It has been many, many years since I have done that, but the stench of it is, fortunately, still in my nose. I do not go so far as Gary’s “never short a bull market” (I do it often), but I need a damn good reason to, and definitely not just a trendline, overbought, or some such things. It’s not that it can’t work (anything can), but that the risk/reward is awful. Good luck!
Off topic somewhat. Fukushima has reactor vessels which have cracked, and the fuel has melted.
This is not a 9 month clean up program. That’s just another lie.
This is unharnessed uncontrolled fuel laying around probably in pieces in an open area.
Maybe cementing the entire place will hold it as it melts into the ground into the groundwater, through the core, to pop up in say New York, right?
Or some other bizarre outcome. This is the greatest disaster since Chernobyl, and unique in its own way.
What will the impact be on the yen and the dollar and the PM’s?
Watch anxiety go UP. The outrageous fact is this cracked vessel was obvious weeks ago via a fly over and the glow of the exposed rod pile. What we’re hearing is a major lie.
tell everyone you know to keep buying these metals because your dollar isn’t safe and you’re getting the silent tax (inflation) scare them into buying these metals.
gov’t going to find ways to pay for this debt, either through inflation or by taxing its citizens.
warfare doesn’t bring in the revenue like the old days
If this in fact a run-away move and you believe it will last into early June with silver already stretched almost 1.7X above its 200DMVA today, how much farther do you believe it will stretch?
Brian – that’s exactly how the runaways get started.
the market is emotional.
don’t you love the people so stubborn in their views they will to no end put their own financial security at risk by putting these bets on the table.
or ones who find the little bits of information to help justify their own position but ignore the other.
the best traders are neutral. don’t marry these metals either, but for certain you don’t want to go against a bull. it may get tired, but if you poke it with your shorts it’s going to wake up and kick you in the face.
I’m not nearly as sophisticated as many investors here, and I am trying to learn as much as possible here, so I have a question for anyone who has an opinion.
Those people who last week reduced positions that were NOT leveraged, did they make a mistake or is the jury still out?
I am following Old Turkey. I am still 100% invested – no leverage.
Due to the inability of PM’s to go down, especially today as the dollar rose strongly, has made me wonder whether a runaway move has started. What would have to happen to raise the probability that we are indeed in a runaway move?
I also wonder whether the April 12 low could have been the daily cycle low and was just not very deep and also early. How likely do you think this possibility is?
you are on the right track and even if we had a pullback, old turkey can survive all the wiggles and scary stuff your going to outperform all traders… well 99.9 percent
I got lucky selling a few miners and am now buying back in. Got cute with my AGQ position and now I need to re enter on a dip which will be well above where I sold. End of day, stupid to leave positions until the cycle ends.
Only time will tell whether folks who lightened up recently made a mistake, but it’s starting to look like that’s what happened.
You can never go wrong holding old turkey thru a daily cycle low unless you are too heavily invested for your own comfort and they daily low causes you to make an emotional decision to sell (usually near the bottom).
Rob, I did not reduce any positions, leveraged or otherwise. For me, when I have played that game in the past, I always got burned. Primarily because I have a full time job that prevents me from timing entries and exits optimally.
Some of the folks here that are good traders and have systems can successfully trade in and out. I can’t, so I stay with the program. Daily cycles, even violent ones are noise.
I could see the gold/silver discount the dollar strength at first then finally (ie violently) succumb to it as the $ continues to rally. The bullish complacency in PM’s seems a bit high to me which is disconcerting as well.
On the flip side in a runaway move anything can happen.
The University of Texas Investment Management Co., the US’s second largest college endowment fund, bought a billion dollars worth of physical gold on Friday .The fact that a major university would put that kind of money into physical gold at these price levels ought to be a wake up call to the investment world. Obviously they believe the price of gold is going MUCH higher from present levels.You would think this news gold would really take off but gold was down this morning before the downgrade by S&P came out-of course there is no manipulation in the markets ,is there ?
Given the massive divergences exhibited by the majority of the mining complex, would it be safe to say that IF we get confirmation that we’re experiencing a runaway move into the conclusion of the C-wave, that the miners should then respond? Ergo, if one was waiting for another daily cycle low to redeploy leverage and we get some sort of confirmation that a runaway move is in progress, would it not be safe to deploy this leverage into SLW calls or the like, as the miners would eventually start to outperform?
Rob L: My two cents. You absolutely cannot tell whether a trade was a mistake by whether it worked or not. Time will not tell. If I offered you a 5 to 1 bet on the flip of a coin and you lost, was taking the bet a “mistake” on your part? This is a game of expectancy. Selling and having something go higher is not a mistake. It may have been. Or you can buy it back higher for a small missed opportunity. Or it may go higher this time but drop in nine other similar situations. Or…Would that it were that easy to tell. Most traders are emotional. Trading emotionally—selling when scared and buying when confident— is surely a mistake. Emotional traders will always lose to Old Turkey (and to any other approach). Gary is not as OT as one might think in that he sells for intermediate declines. In January he sold and soon bought back higher. Was it a mistake or the right play that didn’t work? If I buy back higher it will be the first time my sidestepping a move I expected has underperformed Gary (in percentage gain not absolute return on account because he is much heavier than I am). It happens. If it failed 4 times out of six over a couple of years I’d decide I was doing something with low odds of success. I believe over time my approach will outperform. We’ll see over the next five years (If you flip 1,000 coins and keep losing something is wrong.) For myself, thus far, my selling early has cost me nothing because AGQ is up but the miners i sold are all down a lot. As I said, my two cents…
Robert, UT is obviously buying close to the top. They are going to get stuck with that huge position as the D-wave begins. Just because they are big doesn’t mean they are smart.
Actually what they did recently is absolutely stupid. They should have been buying in January. Just shows you that their investment team has no idea what they are doing. They are just jumping on the band wagon and jumping on late.
When they freak out and sell during the D-wave it will just exacerbate the decline. Of course the conspiracy theorists will call it manipulation even though I will have warned you it is coming months in advance. Just like I warned months in advance we would see this final run despite all the conspiracy nonsense floating around.
I still have no idea how anyone can even remotely entertain the idea of manipulation when the metals get into a run like this. It just shouldn’t be possible if the Fed has an unlimited amount of money to throw at the short side of the market.
Regarding whether selling was a mistake for those of us who are not leveraged. I think DG did an excellent job of answering this question, but I want to add a couple points.
1) Most of my sales were in miners, and so far, they have traded ower than my sale prices.
2) I think my exposure to the miners is appropriate for now. If we look to be in a runaway move I will add exposure to the metals.. I will add to miners if they begin to outperform, which i would ocnsider to be a strong tell regarding the status of the bull. In other words, if silver is up 2% and SIL and GDXJ are up 3.5% that would seem much healthier to me than the tape of the past several days.
It will also be interesting to see what happens when Gold breaches 1500. And most interesting will be the relationship of the dollar and the metals.
I’m not sure why so many people are fixated on UT. Fact is they simply took possession of a large amount of gold that they probably bought in the futures market some time ago. The reason for taking delivery seems obvious to me.
Everybody seems to want to play this like they just pulled out the checkbook Friday and bought. These managers are a little more savvy than that.
Gary: It is hard for me to picture a runaway move with the miners acting so completely crappy. Oh well. Anything is possible. We’ll know soon.
Those of you reading the blog without subscribing are trying to save $100 and risk blowing what may be one of the the most profitable metals move of your life. Ain’t worth it.
DG, I agree. When I look at a long term chart every daily cycle is pretty clearly visible. Apr. 12th is not clearly visible as a cycle low.
I’m very hesitant to call that a cycle bottom unless gold clearly ignores a dollar rally. One day is too early to say whether the dollar rally has begun or whether this was just a one day blip triggered by the down grade.
I was not leveraged but I was 100% in. I sold off all my miners and only sold the same amount of AGQ/HZU as Gary. Unfortunately I didn’t get to sell my miners near the top but I still wanted to get out because I didn’t like how it was diverging from the metals. I also did not go all in when Gary called the IT bottom so for me to have lightened up was purely risk management for me. If this does turn out to be a runaway move (doesn’t feel right miners not participating) great I’m still in. If we finally do get the daily cycle I’ll add on Gary’s call.
IMO if IBM can beat and no negative guidance is given I can see the scenario of money moving out of metals and back into stocks. Given todays big down day and the market closing off it’s lows, the market is begging for something to rally behind and I think a IBM beat can provide that.
I see your point re “mistakes” in trading. The main problem with thinking that way is that if the market does what you weren’t expecting when you opened or closed a trade, seeing it as a mistake is damaging to a trader’s own emotional and mental make-up.
You said something about the UNG trade a few weeks ago that emphasized that point. Once you close the trade, you move on. If UNG goes up after you sold, that shouldn’t be viewed as a mistake. You considered all the evidence and acted accordingly, and in a similar situation would do the same thing again.
However, if you are new to the trading world and you’re following Gary and you don’t have an established track record of trading successfully, then dumping a large chunk of your AGQ position in anticipation of a daily cycle low was probably a mistake. Why? Because that action was very likely an emotional decision, and was certainly a decision that was not based on any kind of personal track record. The best way a new trader/investor can avoid making mistakes in the future is to just follow what Gary does, with the caveat of knowing what your risk tolerance is and knowing how much you can be invested without freaking out during periods of drawdown. So when Gary is fully invested or fully leveraged, for you that might mean 50 percent invested or 70 percent.
Gary, Is it safe to assume that any dollar bounce will not surpass the March 29th high of 76.43 (make a higher high)? If this should occur, does this change your forecast for the last leg in the C-wave?
One of John Murphy’s best anecdotes from his Intermarket Analysis book is about market tops. I don’t have it with me, so it is a paraphrase.
After an economic expansion has run it’s course. Equities top first, followed later by commodities.
Seems the equity top in Feb, is playing into this analogy rather well. You can look at previous tops for confirmation, but usually oil is the end run, because high oil price always leads into a recession.
It shouldn’t but there are always exceptions to every rule. The Jan daily cycle in the dollar surpassed the Dec. cycle high but was still a left translated and failed cycle that started the plunge into the three year cycle low..
Pima: Yes, I agree with most of what you have said. It’s an ever shifting line between just relying on Gary and learning to do it on your own. I believe that line needs to move towards self-reliance over time. My post was more about people being careful to analyze rather than to assume “if it worked it was a good trade, and if it didn’t it wasn’t.”
I am not so concerned about damaging the trader’s emotional and mental make-up, though that is is important to avoid as you have said. My concern was “learning” the wrong trading rules from a bad trade that worked or a good trade that lost. Learning bad habits is very expensive. Interesting and good post, though. Thanks.
Re: The Univ. of Texas buying/taking delivery of gold: “…managers of the endowment, known as UTIMCO, sought board approval to convert its gold investments into bullion this year.”
Gary, The cycle from late July last year to late October which was 61ish days had a mid point decline in September that looks very similar to what we just experienced.
The question is would you label 09/18 as a daily cycle low, or consider that whole run 1 daily cycle?
Gary, my wife has our credit card in our earthquake kit, and for the life of me I can’t find it now – will check the car – will sign up when I find it.
JayHawk & other chartists, is any one worried about the neg div in SLW’s daily & weekly chart? Looks poised to hit the 200d EMA, as in Jan. W/my limited understanding of cycles, this may also coincide w/Gary’s cycle stuff on the dollar and gold.
What the hell is a “runaway move”? First I heard of it. Is this something that happens when cycles don’t work? Will we know what’s going on within a week or so?
Eamonn: It means something that is going up no matter what. Cycles and other methods simply stop working once a true mania takes hold. Rare, but it does happen. If even a rallying dollar can’t cause a gold correction it may be what we are dealing with. This week is telling.
Brian, I think it has b/c it was news that was expected. JPM had a great quarter but sold off during the day, I think, b/c earnings were helped by its credit card business (debt). Another leader, Google, costs didn’t look good due to their large hiring spree. TXN missed tonight. IBM, I think, can provide the market the little bit of positive news it needs.
DG, thank you. Also thank you for your earlier comment RE shorting. I got out of it pretty quick. I’m sitting on my hands now waiting to see which was the wind will blow. Its hard waiting. I get itchy fingers. But I will wait. I just have to learn that lesson.
I remember you saying you sold out of all your miners and thinking strictly going all in AGQ when you add. Today, you stated that you were close to getting a buy signal for SLW with your system. I was wondering if we do get the correction that we’re expecting, will you just be deploying in AGQ and SLW or strictly AGQ? I’m kind of in the same boat and deviated from Gary’s portfolio (risk management for me) so I’m trying to decide if I want to deploy everything in AGQ/HZU or go with some miners.
Ryan: I tend to follow my buys when they show up as they are very high percentage trades. My plan would be to buy SLW, hopefully watch it pop, and then put in a mental break-even stop in case the miners break down again. I would buy all the AGQ I planned anyway and SLW would be extra.
BILL: I don’t see a negative divergence in SLW daily (and I use RSI(5), which is very sensitive to those things.) There is a bit of a negative divergence in SLW weekly, but I think that is being taken care of right now (the drop since last Monday).
I don’t think there’s any chance that SLW will hit its 200MA or 200 EMA this time around. It should bottom in this correction somewhere in the 38.80 – 37.50 range. It looks like it will essentially put in almost a double bottom with the last daily cycle low.
PSLV had a wild day indeed – up 6.5% off the previous close, while AGQ only went up 1.8% yet tracks 2x silver’s performance. So investors Monday figured PSLV was worth 3x silver’s performance?
I figure it must be the scare of a potential downgrade in the rating on US debt that had more people running to one of the solid funds (ie, more unequivocaly physical backed).
I like PSLV, but at a 23% premium to NAV, I’m thinking it’s a pretty good spot for me to take profits and cash out ahead of maybe a daily cycle low. I might then put that into something like AGQ or if I want to stay with a solid fund, then I’ll switch over to CEF, which is half silver and only trades at a 3% premium.
A big overhang to me with PSLV and its 23% NAV is that with all the interest in it and the astronomical premium, Sprott is bound to do another share issuance, which will promptly deflate the premium some. Sister fund PHYS just did an offering and these kinds of closed-end funds usually do one or two offerings a year. PSLV’s first one came back in November.
–IF– we are in a runaway move (we can’t say for sure just yet but should know something within a few days or before the week is out), then corrections in gold will likely be limited to $30 or less.
The last daily cycle low was a 60 point correction. If we do get another daily cycle low, we should see at least a 60 point drop in gold.
A runaway move sounds great, but if the miners don’t confirm the move how is this possible? I know for one I am confused. I still think a nasty correction is on its way. I won’t be buying back my leverage into this; it just doesn’t pass the smell test. Happy to be wrong, but I would think runaway moves would have the miners leaping up not neutral or dragging down sharply.
Of course I am not saying to not hold a core position and sell everything…not at all. Just expectations are a way of getting one in trouble if leverage turns against them.
Hmm so say the dollar goes up, gold and silver go up, but the miners go down….what the heck does that mean?
Agreed- PSLV’s premium is ridiculously high and I was wondering who the hell is buying it right now.
I also plan to re-deploy a bunch into CEF (lower volatility) and some miners ETFs as well as some silver stocks once this long awaited cycle low occurs.
Here’s a question, why would the US dollar rally on a day when the news was dominated by a potential downgrade in the credit rating on US debt? I’d have thought that would be bad for a dollar as a sign of lower confidence in the creditworthiness of the US.
Is this just a knee-jerk flight to safety in the dollar even though the bad news is dollar-specific? Seems nonsensical just writing that last sentence yet we often seem to live in a nonsensical world. 😛
I was confused by that reference in the nightly report … trying to understand the difference between a runaway move correction and a daily cycle low correction.
I guess I’ll keep both concepts in mind while we wait for a clear signal.
Moondoggie: “… trying to understand the difference between a runaway move correction and a daily cycle low correction.”
As far as I remember, Gary doesn’t use the term “runaway move correction”, but just “runaway move”. It’s not a correction, but a very strong parabolic up move that finishes with climax top.
Makutaku said, “As far as I remember, Gary doesn’t use the term “runaway move correction”, but just “runaway move”. It’s not a correction, but a very strong parabolic up move that finishes with climax top.”
Could you please clarify the term “correction” for me? Is a correction always down? (It’s confusing to this newbie sub.)
Eamonn: It means something that is going up no matter what. Cycles and other methods simply stop working once a true mania takes hold. Rare, but it does happen. If even a rallying dollar can’t cause a gold correction it may be what we are dealing with. This week is telling.”
But Beksachi jsut reported Sprot’s Silver fund is carrying a 23% premium.
Hello. The gift arrived. You’ve just not wanted to open the package.
Gold target, once the package is opened (which means gold gets above 1551), is 2100.
At 2100, game’s over for all but the totally reckless as that will be above 6X.
I’ll be gone at 2000+ At $2000, gold will be then nearly fully inflation adjusted, unless while getting there, we need to buy and use wheelbarrows to carry around the fiat.
Diana: “Could you please clarify the term “correction” for me? Is a correction always down?”
To the best of my knowledge a correction can happen in either direction. It’s when the price, after being stretched (up or down) snaps back, or partially back – towards the mean, like a rubber band.
Because we are in a bull market in PM, correction will normally mean down in this forum.
Neo; Gold is the driver so I am not sure I would watch silver, but if one wants to look for patterns you can see a rising wedge on the GC 1 hour. I just don’t think patterns at this point are the most valuable tool.
The only reason patterns even work is that they sometimes represent the thinking of the market. One needs a big pool of traders and investors for that to have any hope of being representative.
Intraday one is just dealing with a very small subset of day traders and short term market timers. That’s not a big enough pool of traders to make patterns representative of anything.
I haven’t read all the posts so I apologise in advance if this has already been posted.
Silver chart shows the two repeating ranges up of the measured move from January 28 low is almost complete. The target is $44.02. My data shows the last candle tagged $43.56, awfully close. it was also a hanging man candle which tend to occur near turns. A 50% retrace of the last leg would take us back to ~39, a 50% retrace of the entire move is back to ~35, heaven forbid.
Looks like we have the potential to put in Gary’s cycle low very soon. I hope you have your insurance paid up 🙂
Jammer, Mr Miyagi & Pima Canyon: Thank you for your replies and for sharing that! What would an example of DITM SLV calls be? What if we don’t get any correction and we just go up and then down, down …..into the summer doldrums? How much merit do you give to the seasonality statistics? There was a high correlation for much of last year. Thanks Guys!
Thanks Silverhound! Great chart indeed… And Gary, definitely, if I go for it , I will tell them that you refered me… Small token for your great help along those recent months!
No probs. The final target depends on how you draw the pattern and as you can see Gary’s target is a little higher. The main thing is it gives you a target zone to look for something to happen.
This from Ed Steer’s daily .. (I do believe in the silver manipulation)
Here’s a paragraph I stole from silver analyst Ted Butler’s Weekly Review which he sent out to his subscribers on Saturday afternoon…”Against the backdrop of a surging silver price, the calls for a sharp sell-off continue unabated. As I previously reported, almost all those calling for a sharp correction seem to share a commonality, namely, a disbelief in the silver manipulation. I think this is a crucial observation. Let me stipulate first that there can be a correction in the price of silver regardless of whether it has been manipulated or not. But nothing can be more important to the future direction of silver prices than in understanding whether this market has been manipulated. To those who don’t believe silver has been manipulated in price, it’s hard to see how the price won’t collapse. Those who believe that silver has been manipulated [like me] know that the price will explode when the manipulation is terminated. That’s a clear line of demarcation.”
For clarity can you confirm that we are waiting for a dollar low which we expect to mark the top for gold? At that point you expect a pullback before the final blow off?
Slumdog: (re your 2:03 post) The “gift” is a great idea—it’s just not what we were talking about. Eamonn’s question was “what’s a runaway move” not “”has silver rallied a lot.” You probably gave a great answer to some other question.
At Ease. Yes, but he said: “Hello. It’s here.” And it both hasn’t been established that it is, and we are not at the end of it., He writes so poetically that I rarely understand what he is saying so maybe I have misunderstood him.
SLW’s late day rally yesterday and flat to higher opening today has killed the possible buy signal for now. We;’d need another very sharp down day or two to get it. Too bad.
Nice chart. Although your target of 50% might be a bit extreme.
Check out how the first part of that move only retraced to the 23.6 level where it found support.
One the /SI chart, that would mean a move to 41.15 for the 23.6, right where the 10EMA is rising. The 38.2 retacement would get us to the 20 EMA right around 39.69 if my chart is correct. Given the timing band issues for gold to give us a swing low/swing high, I’m favoring the 10 at this point.
Guys, I have very narrow parameters that get me into a trade. Options, warrants, individual miners, etc. I have no particular opinion about (at least not one that’s worth much). My specialties are particular trading setups and SPX directional calls at certain junctures. For the rest and decent trader’s opinion is as good as mine. I post a trade when I have high confidence in something
I like optionsXpress. I got an account there mostly to learn as they let you do that for free endlessly. You can run all kinds of scenarios. Good for me as I learn from seeing and doing, and this way I don’t lose any money.
Hot Rod, I thought the interface was a little learning curvy, but if you click trade, then save something you might be interested in, you can hit the calculate button on the saved trade and then run all kinds of calls, spreads, etc. Maybe take an hour and fiddle with it and you’ll appreciate the power of the software I think.
I don’t doubt you are correct. I wouldn’t expect it to go way back to 35 either (hence the “heaven forbid: :-)). I do think that 50% retrace of the 2nd range up at 39~40 is possible though. There is a nice little divette around 40 (dare I say EW subwave 4 correction) that may indicate support. That would set us up for EW 5 which as you know is the big one with commodities.
Had to work Mon and Wed this wk as a consultant, but here today and end of the wk.
kind of a fuzzy day..not much going on and no clear picture of direction as of yet. I like the charts for EXK and Ag ,consolidating above the 20sma (but will they break down to the 50sma, or up out of this consolidation (flag-triangle?) pattern?? Cant tell.
A friend asked me about buying SHZ last week if it broke above $6.50 , and I drew this chart dated April 15, saying to wait — that it could actually go back to the original breakout , and at the bottom of a new trendline. This would be below $6 and maybe $5.50 area.
It is there now ,but volume is strong(ish). It may become a buy though, believe it or not 🙂
Makes sense, this is afterall the three year cycle low, and things should be getting out of hand… sentiment is a non issue. Dollar can keep heading down, while the PMs keep pushing higher leaving a lot of chasers behind. Very few people expect this.
Runaway moves is a persistent rally that grinds higher day after day with occasional corrections all of which fall within a standard magnitude and duration.
If the April 12th correction has set the standard then all corrections should fall in a range of about $25-$35 points (on gold) and not last more than a few days.
Gary, Couldn’t yesterday’s action in the dollar simply be the result of emotional investors rushing to unwind their carry trades (buy back dollars) and not the start of the dollar bounce that we’ve been expecting. I’m not giving up hope yet that we’ll see a more substantial move in the dollar over the week or two. BTW, the financial times reported that the Fed, at their April 27th meeting, will confirm that they will finish all $600 of QE2 as planned and that there will be no plans for any further easing (yet). I know that this is probably outside your timing for a correction, but it could be a day to watch.
Patrik, Not being fully invested has been driving me nuts. I still have about 10 percent sitting on the sideline waiting for a home. If I don’t see some kind of correction soon I may just pour the rest in by the end of next week.
So, if this is a runaway market (confirmed if gold resists dollar rally 1-2 days?) then *would* that actually *be* the C blow-off, *or* would the *last leg* of the C blow come *after* the anticipated dollar 3-yr low?
Inconclusive today as dollar is down a bit and PM’s are up a bit, so just normal. If we get another sharp up day or two in the dollar and gold is up anyway it might really be that it just isn’t going to dip.
Gone for a day or two. I might pop in if something fascinating happens, otherwise see you all Thursday. Take ’em down while I’m gone!
I had sold 1/2 my Exk position and have been in and out of AG, so my purchase was a trade on a short term trade trigger that I got at $11.33, but it may go into my permanent EXK holdings.
Im ove the same school of thought. I closed my aggressive short (tut tut shorting a bull etc), didnt get the shock trade i was expecting that would make some easy cash, so closed out and now on the sidelines.
Re SHZ: Careful with these Chinese companies. Lots of fraud over there. Here’s why SHZ is down:
9:31AM China Shen Zhou Mining receives a going concern qualification for the 2010 year (SHZ) 5.95 +0.06 : Co announced that its audited financial statements received a going concern qualification from Sherb, co’s independent registered public accounting firm. This announcement is required by NYSE Amex’s rules and does not represent any change or amendment to the Company’s financial statements or to its Form 10-K for the fiscal year ended December 31, 2010. Subsequent to the 2010 year end, on January 24, 2011, the Company announced the completion of a registered direct offering to several institutional investors for ~$20 mln of common stock. Institutional investors were issued ~2.8 mln common shares together with warrants to purchase up to 851,066 shares of common stock which, if fully exercised for cash, would provide an additional $7.2 mln in gross proceeds to the Company. China Shen Zhou believes working capital raised in January 2011 is sufficient to maintain operations throughout 2011. Further, the Company reported in an 8-K filing in April 2011 that it entered into an equity transfer agreement for its 60% equity ownership interest in Wulatehouqi Qingshan Nonferrous Metal Development for a price of RMB 8.5 mln. Upon completion, this equity transfer agreement will partially offset the Company’s debts owed to the purchaser, and reduce the Company’s liabilities.
I feel you moneyman. If I had any less AGQ I would be holding ZSL. Silly inexperienced move trying to dance with bull. Lesson learned. But more opportunities to enter will present themselves as subsequent cycles unfold, right.
A smart man on this blog once said. If you like money, stay long PMs. I get it.
Gold painted a high of 1500.50 and got back down very quickly to 1494.50. If it keeps falling and goes down below 1487, it may be what several here are waiting for.
I was 1/2 joking with DG, because he posted news on SHZ..But I also do expect a decent bounce from this level.
I know some on here may follow me into a trade, so I apologize…I am in ‘trading mode’ and should have stated …that it might just be a quick trade, I’m sorry. I do think that its going to get a good bounce from these levels, but at this point, I cant tell if its a buy/hold or a quick trade.
I will re post as time goes on.
Please sell if we bounce even .20cents and you are comfortable with small gain.
I was looking specifically for amateur, as dumb-money as I could get, thinking they would be the last and final to jump on, (or maybe the penultimate group, as they themselves seem to be waiting for “dumb money” to catch on, which would make Who last?).
Where, specifically, do you typically take a pulse when you seek it?
DeMark notes today from Kevin Depew at Minyanville: S & P futures – DAILY – TD BUY setup on Bar 8 of 9. To perfect, low either today or tomorrow has to be below yesterday’s low of 1290.50 to perfect (reach full exhaustion). If recorded, expect a 1-4 day upside reaction – Thursday into Wednesday of next week Gold has TD Sequential 13 Sell Signals across multiple time frames, both DAILY and WEEKLY, but no confirming bearish price flip so far, so gold keep on rising to $1500 and beyond! In the article “Five Things You need to know: The Myth of the Fed’s Unprecedented Bond Purchases”, Point 2, Depew shows the NYMEX Gasoline futures contract – WEEKLY is recording a SELL signal this week, good for 12 weeks, MONTHLY will record a SELL Setup next month if it closes above 249.06, good from June-September. Notice how good a similar SELL setup identified the top in 2008. Good news for summer drivers!
Vonda, Yahoo! Finance is one place, the other is Kitco’s forums. They are both pro-uptrend therefore the indication you get is not a true one but the sentiment is somewhat relevant. More importantly, I try to spot the amount of new forum members at Kitco and here. The more that jump on, the more late money. They tend to make the worst decisions, bandwagon style. This doesn’t apply as much here, there is a lot of technical information, not “To da moon!!” postings by the gross. I believe that whoever comes here and reads, asks and learns has passed the jumping in with both feet tied to a cement block stage.
Aaron, oh no! Cramer-land!! (Didn’t you hear, I’m already down on my luck . . . now I gotta listen to Jimmy?)
Morning SilverHound,
The red dress is wearing thin, that’s for sure. Cheap sin and cheap gin start to stink after about five minutes. So I hobbled my scrappy self over to the casino and plunked down a bet on miners–one table over from Catbird’s AGQ roulette. So much fun to buy then wish it DOWN!! I love how it f’s with (translated as “tempers” for those of you not on skid row) ego-psyche.
Yea, I figured we’d be doing the dance around 1500.
Alex, great response to coolkevs. Why someone persists in posting that gibberish, knowing that most people find it incomprehensible at best, and at worst really annoying, is beyond me.
This is the most nervous I have been in a long time. I’ve made an absolute killing the past few months and evey day all I see is green on my account but when I look at silver and how stretched it is relative to the 200dmva it makes me tremble. We’ve only been this stretched once before at 1.7x and silver ended up crashing almost 20% overnight. Not sure how many of you were around in 2006 but it wasn’t pretty.
Am holding my full position for now but putting my thoughts out there
haha you day trader guys are so itchy with the trigger finger
nice going gold hit 1500, it only run away move if it can sustain this for a couple of weeks.
i think it’s best to stay in the game unlevered with a play on the pure metal though because to time this market with all this volatility and other factors make it even more difficult.
i hope the market can start zooming though and the miners can start up. they are a risk on trade. personally they look neutral at the moment.
coolkeys… Does this say sell even thought it’s still going up beyond 1500?
“Gold has TD Sequential 13 Sell Signals across multiple time frames, both DAILY and WEEKLY, but no confirming bearish price flip so far, so gold keep on rising to $1500 and beyond!”
The lure of easy money is never “too expensive”. Be careful what you buy, there are more than just the dealers at the casino that will take your money……
Needed a good hearty read, Jayhawk, whilst waiting for Apollo and Artemis to ease off the accelerator for a bit. Although the essay– so much in line with what Gary and many of you have been advocating — makes me want to buy AND take delivery, just like Texas (with a few less trucks.)
I’ve never wanted to buy so bad. I got a little taste this morning of AGQ, now I’m wanting more. I think I’ll turn off my computer now. Have a great day everyone.
“…sometimes it is necessary to step back and digest one’s success. By reducing exposure, one can purge from one’s mind whatever hints of greed or other malfeasant aspects of the ego that may be cropping up. The market view then clarifies, and further action can be taken with confidence.”
On the other hand, I appreciate coolkevs’s supplying us with that DeMark info. He’s just trying to help out people here, and, from what I’ve heard, DeMark is probably the most accurate PREDICTIVE indicator system in the world. (Whereas most other indicators are actually backward-looking.)
I used to follow Depew when I was a member of Minyanville. (VERY GOOD place, but dropped it because I had too many newsletters, etc.)
I agree that some interpretation would be nice, since I certainly don’t fully understand it either. If anybody is interested, a good book to study over a weekend or 2 is: “DeMark Indicators” by Jason Perl. I’ve got it sitting on my shelf, just haven’t had a chance to crack it yet.
I’m good, Silverhound. Pretty contented with my dusty, porch-dog life. Anything on top of that is just (organic, sustainable) gravy.
As an analogy, I was kinda thinking about the scene from the old film, The Jerk (und), the other day–at the end where the family used the wealth to build a bigger shack? I don’t have a whole lot of use for additional $$, just like the freedom it can buy and want to protect what is in the bank from scenarios such as the one in the report Jayhawk just shared when they play out.
In the past month when sentiment has been “Looks like I should sell”, the price has gone up shortly after. Conversely, when sentiment, like the past couple of days, has been “I should buy… should I buy? Yeah.. I should..”, the price has gone down. Just my observations, I get the little voices and consequently I either buy or sell a small amount but hold most. There’s only one person who’s right all the time and that’s my wife. I know because she told me.
AT EASE: as I understand it, that DeMark gold info. that coolkevs supplied basically says: no sell signal yet on gold. Those DeMark “sell signals” on the daily and weekly charts are actually “potential” sell signals, that become real sell signals when you get that “bearish price flip” — which we haven’t gotten. (It involves price going down a certain amount in a certain time frame. I don’t fully understand it.)
Anyway, even with a daily cycle low in gold and silver (which I think is still coming up…they’ll probably bottom on options expiration day…which I believe is next Monday), I don’t think that “bearish price flip” will be triggered, and therefore we still won’t have a real sell signal on gold using DeMark.
everyone seems to be just sitting around waiting for this correction which only has 2 days to go if it’s a normal cycle. meanwhile silver has moved $2+ from last tuesday. I’ve been in and out and going to load up come Thursday when weak hands unload for the long weekend.
Rick, whats sad is that during this C wave we have had bigger percentages between the two… if this is supposed to be a blow off top, we still have room. Lots of it.
VANCOUVER, BRITISH COLUMBIA–(Marketwire – 04/19/11) – Extorre Gold Mines Limited (TSX:XG – News)(AMEX:XG – News)(Frankfurt:E1R – News) (“Extorre” or the “Company”) is pleased to announce high grade to bonanza grade gold-silver results from the first 3 of 21 diamond drill holes completed to date on a discovery named Zoe at Cerro Moro, Santa Cruz Province, Argentina. Visual inspection of the core, without the benefit of assays, suggests that drilling has just entered the mineralized zone and that mineralization continues at depth.
Agreed, Mr. Miyagi. With silver so strong, gold is the one to watch here for signs of a daily cycle top. And it’s momentum is falling. It looks like it’ll start to come down later today and tonight.
John’sMotivation My face is bright red right now…I had plugged in 1650, which is where I thought GOLD was going to end up at the peak of the current C wave.
You are correct, we are only 12% above the 200DMA. My apologies to you and everyone else.
I must have been snoozing…I usually look them up, and that chart was drawing a nice cup/handle.
Oh…Actually, before March it had low very low volume ,like 20,000/daily, I wouldnt have liked it. looks really good now (not to buy here, just volume-wise).
XG was spun out from XRA last year and recently received the US listing (XG.V in Canada) and now has great drill results. Great move recently……wish I had continued to add! Check out Orko Silver (OK.V). I brought it up a while back. Increasing volume on the weekly charts, with a potential close over $3.00 being very constructive.
Hi I’m new here! Can someone please explain to me why the silver miners are diverging from the silver PM. Isn’t the miner suppose to follow the trend of the silver PM.. is this a bullish sentiment for the miners.. as for the silver pm it seems like its forming a hammer reversal which can spark a bear?! I just bought SLW and SIL… I hope I made the right decision!
As for buying SLW/SIL now: JUST MY OPINION, but it depends how long you plan to hold them and how much pain you can endure (having paper losses).
I think we’re seeing the daily cycle top in gold (and therefore, roughly silver) today. If so, then they’ll both go down for roughly 4-6 days. Then we’ll start the next daily cycle up. (Gary covers all this on his premium site.)
So, my GUESS is, those positions you bought today will be underwater very soon, and you won’t get back to breakeven for about 2 weeks. And then you’ll start to make money. I think it would be better to sell them today, and buy them Monday – Wednesday of next week. But that’s just my opinion.
And I apologize to Gary and anyone else if I shouldn’t have given this opinion here. I’m fairly new here and don’t know what Gary’s policy is.
Thanks for the link re hyperinflation. Yes, it’s very long. I stopped reading where he goes into stories about what it was like in Weimar Germany and Zimbabwe, partly because those comparisons to the US today are essentially apples to oranges. Will we get there? Maybe. But the first thing that would have to happen would be for the US to start issuing its debt in some currency other than the US dollar, as was the debt for both Germany and Zimbabwe.
we have all kind of had the same question. Most here are fairly heavily invested , some 100%, some even leveraged…We have been expecting a pullback in the metals , and the miners to join the run.
For now, Silver is just crazy, and driving us crazy too 🙂
Rob L, You’re asking me a loaded question! I don’t know, AGQ has led higher since the beginning of March. SLW has been lagging (in my opinion). I’m staying with SLW, personal choice.
it is my personal take on it, so take it with a grain of salt, but the leverage in the mining shares has been priced in. When your cost is $4 per oz. and the price of silver goes from $10 to $16, your profit margin doubles. When your cost is $5 and the price goes from $35 to $40 your profit margins are not affected all that much. And then you have company specific risk (a la HL and, recently, CDE) which is why I have dumped all of my miners in February and am 100% AGQ. Easy to manage and beats the pants off any miner (including AG lately!)
Gotta, cycle analysis anin’t easy. Works better on larger markets. Sort of like EW. Kind of anyways. Have you heard Gary’s interviews are contrary investor’s cafe yet? Actually hearing him is a great advance from having everything reduced to writing.
Welcome. Your scenario is certainly a probable one. I am wondering about another scenario that gives us a correction early next week, just in time for LND for the futures.
But both of these scenarios leave out the alternate possibility: that we do not get a significant correction, that a runaway move has begun. That’s what the buying today is about I believe.
thanks for the advice guys. I subscribed about 2 weeks ago and have been itching to get into a silver position but with all the talk about gold getting into a correction I was afraid to get in. I think gary mentioned earlier that if the dollar continues to fall we may be getting into the runaway phase. I’m just putting 50% into silver for now… I guess if theres a correction I can put more ammo in! Would anyone advise on buying put options to hedge against a fall in the silver price?
You’ve mentioned before that you felt once silver reached $45 that the price would be sucked up to $50 pretty quick. We’re pretty close to that at 44.16. I can’t recall if “sucked up” were your words but the basis had more to do with the previous $50 high than the price of gold. Could you give us your thoughts on that in the post tonight?
Sophia: Nothing incredibly sophisticated. As I mentioned above, I think the key in looking for a cycle top is watching gold (or, in my case GLD, since I don’t have intraday charts for gold). Silver is so strong, that gold will crack first, and then silver will follow.
And you usually watch the “shorter” charts (5 min., 10 min.) for the first signs of weakness, which will then spread to the “longer” charts (15 min., 30 min., 60 min.)
On the GLD 10 min. chart, MACD (which hasn’t been negative since Tuesday last week), looks like it’s poised to go negative (as it did in the big move down Monday last week).
Also, on the GLD daily chart, there’s a bit of a negative divergence [using RSI(5)], which is bearish.
Finally, I just think Gary’s cycle work is very accurate, and that we’ll have a decline into Monday to Wednesday of next week.
PIMACANYON: thanks for the welcome. It’s always interesting to “game” these various scenarios. We’ll see how it plays out.
“Also, on the GLD daily chart, there’s a bit of a negative divergence [using RSI(5)], which is bearish.” If you relied on negative divergences, you would have missed a lot of silver’s phenomenal gains. jmho.
I have been on the road and just got online. For those interested, I just got a sell on TLT at the close. I bought some TBT. Have a break-even stop in on EUO at this point having gotten a nice pop in it. Just missed that buy on SLW I posted yesterday. Darn! Oh well.
DG, Thanks for the post. Was in TBT before, made a little, but you think rates are going up? What is your holding timeframe for TBT? And, miners really diverged, time to get back in SLW, and others?
Doc thinks that we are still due for a daily cycle decline and that it is likely to be sharp, but brief, when it occurs.
One might note that the consolidation pattern formed by gold during March was $60 deep. With the breakout level at $1440, the extension of that pattern is $1500. Gold is also 25 days into the cycle, so if we’re going to see a break lower into a daily low, now would seem to be the perfect time.
I’m with you on this run … I really think this train ‘aint stopping any time soon.
Good general advice on stops.
I’d sure like to see some specific examples from your portfolio, if you don’t mind sharing.
For example, do you own AGQ? If so, what is your current stop on AGQ?
I realize that we all have to make our own decisions and do our own research, but I find it very helpful to see specific examples from the experienced traders here so that we can all watch an learn.
Hot Rod, Read this. Also read the related 4 articles at the bottom. If you print them out via Word copy&paste, it’s around 20 double-sided pages with size 11 font. After that, you can use an online Options Delta Calculator (Google them) to figure out the Delta. Yes, there is such a thing as waaay too DITM!
Hot Rod what is your reasoning for going all the way down to a strike of $20 when you get a delta of 1.0 at the $31 strike? You can pay a lot less per contract to get the dollar for dollar move in SLV
Gary might be right again! Couple of weeks ago, he mentionned the fact that at one point during earning seasons, people will start to buy the stock market and dump commodities…we might be at the turning point….
Does anyone know what the trendline break is for gold? If there is a quick break of that it would be good to know the level as of today and how much it goes up each day.
Motherfffffffff!!!!!! Everytime I use the “a” HTML function, it boots out my comment. Hot Rod, http://www.investorplace.com/714/what-is-options-delta/ Read the above and the 4 articles at the bottom. Then use Google to get an Options Delta Calculator, just plug in price, strike and days left. There is such a thing as Way too DITM options!
I’d expect SPY/DIA/QQQ a good deal higher tomorrow based on today’s earnings (IBM, INTC, YHOO). Also, AAPL, NFLX, PCLN and a bunch of others had afternoon rises. Seems like the PMs and miners are headed for that pre-C decline after all, if all continues into tomorrow. I’m not always right, my wife keps reminding me of that.
I’m almost mostly in gold and silver futures. I don’t play options.
AGQ is just a derrivative of silver. You should analyze silver directly for technical analysis. The world is playing “silver” not playing “something that moves 2x to silver” so technical analysis on AGQ is mostly useless despite all the people here who are trying to do it.
I can’t invest in futures (all my investing money is in IRA accounts) and I don’t know enough about options yet to feel comfortable trading them. Therfore, AGQ is the “next best thing” for tracking the price of silver. If you figure that the price of silver is going higher, as I do, AGQ is a good way to play it because you avoid company-specific risks of the miners and get better returns than SLV.
Hot Rod, Earnings pushing stocks up. Check out afterhours prices on the stocks I mentioned earlier. Also, I posted a link about options for you higher up.
I just glanced at that Shadow Stats report and it’s written by someone who doesn’t understand the US monetary system. Right away it starts in on the Federal Reserve monetizing debt.
I wish just once these guys would ask themselves to what purpose the Federal Reserve is monetizing debt for a country that can print all the money it pleases. Unbelievable.
I think you and I are mostly on the same page when it comes to understanding our monetary system. But the Fed buying Treasuries–isn’t that monetizing the debt? Printing dollars in exchange for T-bills or notes or bonds?
I too began to wonder about the author when I got to the part where he devotes several pages to describing what it was like in Weimar Germany and in Zimbabwe.
Wow, how things play out in a bull market! A few days ago when Silver was at 40, the expectation was that it would go down to 36 in the daily cycle low. That would be severe decline of 10%. Now, if that 10% decline happens, we are talking about just under 40 as the low! Mr. Super Bull rewards old turkey handsomely. That is, as long as you listen to Gary and get out for the D-wave.
This is lifted from an article at Pragmatic Capitalism :
“The issuance of bonds continues to this day due to Congressional mandate. In reality, our bond market funds nothing and serves only as a reserve drain which helps the Fed maintain its overnight target interest rate. It has nothing to do with funding the government. When the US government wants to spend money they do not call China and ask for a line of credit. They do not count tax receipts. And they most certainly do not call the Fed to ensure that we have any money left. No, the truth is that the USA never really has nor doesn’t have any money. So the entire implication that the Fed is helping to fund US government expenditures is entirely inaccurate and anyone who implies as much is still working under the now defunct gold standard model and clearly doesn’t understand the workings of the modern monetary system.”
When you see money being dropped from helicopters, they will be being flown by Congress, not the Federal Reserve.
Le Fou, excellent article. I was thinking the same about rising oil causing miners to loose some profit margin, but the idea about CAD was new to me, and a good one.
Le Fou, do you believe that cycles can accurately predict the turning points in the dollar and gold, the way the EW also claims it can (but can’t)?
Open question to forum: I have about 7K in additional dry powder that I am looking to deploy here on the next correction. I am looking into DITM SLV Call Options. I am curious to know if it is more prudent to purchase a single contract and control only 100 shares of SLV (which I could afford to buy at expiration) or to purchase multiple contracts (six or seven) and control 600 or 700 shares, and sell the option before expiration. I would like to control more shares and sell the option at the height of the C Wave… Any thoughts would be much appreciated. Thanks, all 🙂
I’m not an economist, but I am a big believer in the fact that you don’t have to know how to play third base to tell when the third baseman has made an error.
blakemancillas, The whole point of options is leverage. 1 call is not going to do a heck of a lot for your bottom line. Comissions are going to eat part of this too. SLV calls are 5-8$, I buy 10-15 at a time.
i remain cautious here, i think we could see some action on late Friday/Monday, id certainly be looking for a pullback around here (proprietary seasonal model)
Wes the reason I asked was simply due to your “unbelievable” commment at the end of your post. I obviously dont know who you are or what your credentials are, however there are PhDs from MIT who disagree with you, and I was wondering why you made it seem like the idea was so ludicrous. I’ve read Roche’s argument, and its simply his opinion. It doesnt make Mishkin’s assertion that we are indeed monetizing any less credible. These are and will remain opinions until the end game. The edge on either argument will depend on who and what one is willing to believe or side with.
I don’t think of cycles as a predictive enterprise. I think of it as an alert to be on the lookout for certain moves. Gary combines cycles with other tools like sentiment, trends and technical indicators to take advantage of price movements. Gary is a realist, and he’s always ready to change his position when the market moves against him or in a direction he didn’t expect. If you watch long enough, you’ll see that he sometimes changes his analysis of the trend retroactively because the price has done something he didn’t expect. He says he has only one goal, and that is to make money. And he seems very good at doing that. His advice comes from the mistakes he’s made over the years and the lessons they’ve taught him. I’m just grateful that he’s willing to pass them along to me. Between Gary and theDoc, you can learn a lot about using cycles to improve your own ability to make money in the market.
Blakemancillas, Mr M has it right, more leverage and lower cost overall by buying more than one. I buy in even amounts, so that if I need to, I can sell half when it reaches 100% profit getting my original investment back, and let the rest ride on someone else’s dime.
I’m representative of the common man, and try not to engage in heavy discussion with PhD types.
The Fed is buying the debt but is not funding the spending. Usually when people use “monetizing” it’s to imply that they are, and that’s certainly the implication in the article I referenced.
But, if the PhD’s disagree with what I just stated, they’re wrong.
SD Jack: On the road so checking in when i can. Re TBT: No time frame as I let the market tell me. I believe TLT has hit at least a short term peak. I bought TBT at 37.16. Once it clears 38 I will put in a mental stop at 37.16 and tide it until it does something “wrong.” As for miners, one good day does not a trend make. The tape action has been very weird if this rally is to continue. I have a good chunk of AGQ but lots of dry powder. If at a certain point it becomes clear to me the dip is off the table I have no problem buying. Price never matters to me; just “is it going ujp or down from right now?”
Youre right, need to recalibrate the dates. US is open Monday (EU closed), so maybe close Thursday would be a good time to exit longs for the short term.
DG, Great perspective on those two points. I will take a small position in TBT tomorrow, but a little hesitant due to the chart looking awful. Miners; Gotcha, same position with dry powder & will follow your lead on jumping in with both feet, if I am able to keep up with you on this very busy blog.
1) I thought that the Federal Government was restricted by law to paying out (to their creditors and employees) only the amount of money that they take in in taxes. The amount over and above their tax revenues must be funded by selling debt. Is this incorrect? If so, then the Federal Government can just pay employees and creditors in dollars and the deficit problem goes away, right?
2) If the Fed is buying treasuries, the result is that they are exchanging debt for money. So the net result is that they are putting new money in circulation. Why is that not monetizing the debt? What else would you call it?
I’ll think on it. That better nails for me what Gary’s services are about.
Problem for me is I’ve been following a different guru for the past 4 yrs, and made $0 in the process. I’m still pissed, and have since embarked on a self exploratory thing that has netted out to a simple trading model that I understand and trust because it works. I’m very reluctant to piss all that away to follow a new guru. Kinda like quitting the Christian church to join the Buddhist temple, all the while wondering if God or Buddha exist. It’s a hoop I have to mentally cross before I pay someone for something that I don’t yet trust. It has nothing to do w/Gary or you all.
Probably for me I need to see the dollar bounce, and gold correct, for a few days – that will confirm to me that Gary’s stuff is real – or that he changes his mind if gold doesn’t correct – meaning that he’s pragmatic and real as you say.
In the meanwhile I’ll keep reading and thinking, and following my own system.
I’m really impressed w/Poly though – making all that dough – and then getting out 100% to cash. I’d add her name to your short list of guru’s.
Is it because they have the intention to sell the Treasuries down the road? So they are just acting like any other buyer (and seller) of Treasuries, right? So in that sense they are not monetizing the debt, right?
But what if they buy trillions and never sell them, then we’d have to agree that the debt has been monetized, right? But that is not their plan, so we have to just assume that they are a buyer of Treasuries just like you or I could buy them, and that some time in the future you and I would sell them, and so will the Fed.
The US government is never constrained in it’s ability to spend. It could be constrained by Congress, but nevermind that.
So, there is absolutely no reason I can think of, and I’ll go so far as to say there is no reason you or the PhDs can think of for the Fed to fund the government.
It’s not like they’re about to run out of ink or electrons.
bill this daily is tricky, but gary got us in at 1330 ish. daily cycles are for adding leverage. the cycles do come very regular. if you are just starting, you are starting close to the top. gary has great tools we all are learning . dont give up yet
I understand your reluctance to follow another market analyst. I too had the same problem with Gary, was very cautious at first, and even after I subscribed I did not go all in following his calls. But he has been right on and I’ve made money. Made some on the late summer/fall rally (didn’t go all in on that one) and made a bunch more since the January low.
Now’s the time to do this. The C wave may have only a few weeks left. Once it’s done, we’re on the sidelines (or maybe a small short on a sector in the stocks market) for a couple of months or longer. Then if we get lucky there will be an A wave that we can catch for profit, but after that it will be slim pickin’s for a year or longer. So now’s the time.
Just buy a one month subscription, read the last couple of weeks of daily reports, read the terminology and other docs to get up to speed on cycles, spend a month letting Gary call the shots, and then see what you think. Believe me, the amount I’ve spent to subscribe to Gary’s service is pennies compared to what he’s helped me make in the PM markets.
Bill, I understand you frustration. I followed some gurus, made my own decisions and came up short. Started following Gary, had to start rebalancing here and there as each oportunity presented itself and I have to tell you; things are looking good! I took profits on a little agq last week,shouldn`t have but that was the move at the time. Core is intact and powder to burn to finish C.
Why not do a month with Gary and try a few small positions and then let the results speak with little risk? No need to go whole hog when a little old gold turkey will do.
One more rant before I buy, because I finally found our credit card 😉
Just like there are a couple of EW guru’s, and they don’t agree at ALL, there are a couple of cycles guru’s, and they also don’t agree at all.
I think that once Gary wrote that he respected and learned a lot from a good ‘ol Alabama guy w/initials TW. I love listening to TW every week, but he was flat out DEAD WRONG on cycles 2 yrs back on gold – missed it completely. Just like my other guru. JG, his sidekick, nailed it, because he’s a chartist, and just followed the trend.
Another cycles guy is in Florida, initials LE. He says he’s a cycles guy, and he also COMPLETELY missed the last 2 months of gold/silver’s rise. He still warrants caution.
These guys are nice, and failures.
It’s the success part of Gary’s work and you all that encourages me to come up to the trough one more time and drink.
I’m a math/physics guy so the only way I know how to do this is to split my brain in 2, and I’ll put $100K on Gary, and $100K on my brain, and see how they net out over the next month.
Again, I did discover a killer system that works and works and works. It’s simple, and that’s why I could think of it. As I wrote here once, Einstein said to keep things as simple as possible, but not too simple.
I hope for Gary’s system to work so I can join you all and switch from being a terrible trader to a killer (follower) trader. I’ll sign up now.
Pima, Aren’t we supposed to see a correction here soon, buy on the dip, and then profit from a parabolic move to the top of the C Wave? You say “a few weeks left.” Does that mean like 6 weeks, or a couple weeks (as in 2)?
Congress and Congress alone determines how much the US spends. If Congress says “spend more than you take in”, and they do all the time, the US Treasury spends it.
That’s called deficit spending.
None of this, other than the bookkeeping, depends on the government collecting anything or borrowing anything. They just print it.
The quaint notion of selling bonds is left over from the gold system, and Congress keeps renewing it because they don’t understand the US monetary system either. But it doesn’t raise money for the government, anymore. It’s used to determine interest rates, now.
Now you are technically correct that buying treasury bonds is called monetizing, but the problem is that many people believe that that also funds the government. That part just isn’t true anymore and hasn’t been for more than 30 years (since Nixon).
Now, what the Fed is actually doing under QE2 is exchanging short term debt for long term debt. They certainly aren’t printing dollars. Only the Treasury can do that.
Slumdog, to your earlier post about Fukushima. I’ve read the same thing – that Japan is lying, and that the US is telling the truth.
I have 2 facts for ya: 1) everyone lies, and 2) GE (US company) built the plant.
How do I net it out? 1) everyone lies, and 2) I gotta take it on myself to judge what’s safe and what’s not (fyi our passports are sitting in our car which is full of gas, in case we have to flee Tokyo again).
I have 2 other thoughts: 1) it’s amazing that a Richter 9.0 earthquake (3rd largest ever recorded by mankind) and a 30 meter (100 foot) tidal wave didn’t do even more damage and further obliterate the scene. If this happened in Tokyo or LA, man we wouldn’t be worrying about who’s lying, we’d be getting our arses out of Dodge. Am sure you agree! 😉
Your plan is good except for one thing. Gary says we won’t get another chance for the end of a C wave for years.
Gary does indeed do what you are waiting for him to demonstrate to you, but the better plan would be for you to pony up the $20 and read all the past history.
Otherwise, you’re risking a lost opportunity. This isn’t the stock market where there are new trades every day.
Don’t be so arrogant as to say TA won’t work for AGQ. I traded the previous 174 cycle low using P&F for back + fill. IMO, /SI SLV and AGQ are great reflections of each other and best used conjointly.
Don’t get too married to the idea that this is a blow off C-wave. Gary was saying last Winter that the C-wave was coming and it didn’t. We got a normal, nice intermediate rise out of the yearly cycle low last Feb, then a mild intermediate correction followed by that very large move out of the summer. (QE2 was on the way and was officially announced on Nov 3rd)
I know Gary is pretty set on the C followed by massive D-wave, but I’m personally leaning towards this being a milder cycle in gold and miners followed by a milder correction. Rise and repeat as we go along until the final blow off top possibly years from now. Not that I’m going to hold onto my positions during the intermediate decline, but my expectations are not too high for a major move having to happen in the next month. (Gold 1700 then to 1250, silver 60 to 24, etc.)
I do think we have something extremely unusual going down specifically in the silver market totally unrelated to inflationary pressures. Yes, other commodities are doing well and gold certainly making some nice gains, but OBVIOUSLY we have caught the right metal at the right time.
So no buy signal on SLW? I’m in the same position as you. Decent chunk in AGQ/HZU and lots of dry powder just waiting to jump back in. Are you thinking going all in metals when you jump back aboard? It’ll be greatly appreciated if you post when you do. I’m going to follow your lead or wait for Gary’s signal.
SD Jack: Regrading the TBT chart—looks to me lime it blew out on the downside and reversed on heavy volume (and TLT on the upside) in mid-March and has now gone back down to test that reversal. If that test holds—and i believe it will—TBT should have a nice rally. I have (for me) a wide stop on it.
BTW, I had a typo: I bought TBT at 36.17, right at the close, not 37.16. Good luck!
Yes Wes, I meant to put that. The difference is this year the 3 year cycle low on the dollar is due. I just think even if the dollar bounces, other currencies will take their turns going to the wood shed like last Spring. (Dollar rallied with gold during the crisis in Europe)
Regarding that article on the miners…I’m not buying it. For SLW to completely decouple over the past 2 weeks is extremely odd. They are not a “miner” as we know. Juniors too just doing nothing. So very odd.
We may or we may not see a correction. If we do, it will likely be the last one of this C wave. If we don’t, the C wave will just continue to grind higher and higher till it’s done.
This buying on the correction, not sure where that came from. The answer is yes if you have more funds to commit. Hopefully most here are very close to a full position, so there shouldn’t be much buying on the next correction (daily cycle low) –IF– we actually get a correction.
How long till the C wave is done? Maybe just a few more weeks, maybe late April or early May. However, I believe the current thinking is it’s likely to last till June. After it’s done, we’re out because there will be one helluva “correction” that follows: the dreaded D wave.
“Now, what the Fed is actually doing under QE2 is exchanging short term debt for long term debt. They certainly aren’t printing dollars. Only the Treasury can do that.”
I thought that they were buying Treasuries. Doesn’t that mean they are paying dollars for long term debt? Where do those dollars come from if they aren’t printing them?
I thought next Wesnesday (April 27) was the significant date this month for futures because it’s Last Notice Day. Doesn’t that mean that’s the last day contract holders can specify whether they want delivery? And hasn’t that date in prior months had a significant correction just prior to it?
Got a bit of a wedgie thing going on the dollar. If it breaks higher, above the upper TL, then we probably made at least a daily cycle low on the dollar a couple days ago. If it breaks the lower TL (tomorrow it’s at roughly 74.62 on the June futures), then look out below, the 3 year cycle low may be dead ahead. Until it does one of those two things, we’re just waiting IMO.
The Fed is buying the debt back from the primary dealers (PDs – who purchased it in the first place) with dollars in digitized form which is transferred to the books of the PDs. Therefore, they can say they’re not “printing” money, but it’s the same thing because they’re creating money/monetizing the debt.
The primary dealers then turn around and buy the markets, especially the commodities/metals which is driving everything up, including the global food prices. Starvation is occurring in some areas of the world because of this “policy.”
However, if the Fed dumps the Treasuries in the future (and thus takes their “printed dollars” out of circulation), then they have not monetized the debt after all, right?
Can anybody tell what the miners (GDX and SIL) are saying relative gold and silver? Are gold and silver just catching up to the miners or are the miners signaling something with their divergence?
Thanks folks for your encouragement. I think it’s great to have such a rich group of successful talent to learn from.
The morale in Japan is a bit bi-polar – in Tokyo (nearer to the earthquake) it’s still pretty bleak – almost depressed – but farther away in Nagoya (where I went) and in Osaka (I heard) it was just a blip and it’s business as usual. The depression in Tokyo is caused by listening to all the survivors speak about still looking for their missing spouse or missing child. Really hopeless. We lost our son to cancer, so I can relate a bit.
Does the C-wave necessarily have to conclude with a dramatic vertical move?
Couldn’t we achieve the euphoric sentiment more slowly with a steady, grinding melt up from now until June?
Actually, the latter would probably keep more riders off the bull — these people would keep waiting for a pullback that isn’t coming. Then one day in June, the bottom drops out.
Now you’re asking the questions I was asking many months ago.
The psychology is striking. The Fed actually said this was their intent, to increase asset prices.
Now think about this for a minute. The fear of inflation is a much better driver of asset prices than is actual inflation. With actual inflation you have the Fed raising interest rates and otherwise interfering with the rise in asset prices.
Without actual inflation, you get none of the interference. This is a much better deal for gold bugs.
Thanks Mr. M and Jack for your above insights re options :). I’ll load up on DITM SLV calls and utilize the leverage for all its worth during the last leg up of this C Wave!
I don’t want this to get into a pissing match, but here’s what Business Insider says about QE:
“The term quantitative easing (QE) describes a form of monetary policy used by central banks to increase the supply of money in an economy when the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.
A central bank does this by first crediting its own account with money it has created ex nihilo (“out of nothing”).[1] It then purchases financial assets, including government bonds and corporate bonds, from banks and other financial institutions in a process referred to as open market operations.”
So they are saying what I previously thought was happening: the Fed is buying long term treasuries with newly created money. If this is true, then your explanation (exchanging long term debt for short term debt) is incorrect.
Gary, so are we still waiting to get back in? Or should we take a 50/50 chance and put half in or scale back in on daily lows? Or just sit and wait for dollar confirmation? Thanks
If USD falls further, stock price will raise which fuel the miners to follow the gold and silver price increase.
I noticed a 1-2-3 reversal on SLW and SIL today (if I have the correct understanding). So, I may increase my exposure knowning Monday’s low is the failure exit point.
Nice report. Regarding the ascent stocks made from July 2006-Feb ’07: I was suggesting earlier that maybe this is what gold’s final climb to the C wave top would look like, as opposed to a parabola.
If I read you correctly, that probably can’t happen as the PM markets are so much thinner than equities that once all the Big Boyz begin doing “capitulation buying” then the PMs *must* go parabolic.
Just found a few free minutes to check on the markets. WOW. Got to say seeing $44 Silver makes me a little envious, but I’m glad many here are making a killing. Congrats
Got to say all this talk of a runaway move are alittle premature and might be a scary setup, considering were still in normal cycle bands, let alone stretched. I’m all cash and waiting to pull the trigger, buy seeing these prices and my stubbornness are keeping me out.
Shout out to the SMT gang, all the best. P.S Wes, I’m with you on the “Debt Spending” but you know this isn’t the crowd 🙂
Also, I would be careful thinking a pullback will never come because of some runaway move. Even parabolic runaway moves often have violent shakeout moves, you could argue bigger moves too.
Poly, I am with you waiting to pull the trigger, but the prices, want to wait for the shake out, but… if it’s not coming, how long (or should I say, how HIGH) will you wait to get back in? Thanks, any insight appreciated, first C wave for me.
Only the Treasury can create real money. That’s the law, plain and simple.
But, if someone wants to look upon a short term T-bill as money, it’s O.K. with me. You can take one to any bank and walk out with cash.
Now if you carefully read the quote, they are not even mentioning the US Fed. I frankly don’t know the strict definition of QE, but the US Fed has not increased the money supply.
I can say that with confidence because the money supply is still not back to where it was in 2009.
At ease, I won’t ever pull the trigger without a pullback, but that just because of how I trade. I will miss the rest of the move in that case. But a nice pullback, say 10% and I will be buying as this board lights up like a Christmas tree.
I’m going all in tomorrow. For those of us that missed the lastest run up, I’m leaning towards GDX or GDXJ to put most of my money to work, with a smaller portion towards SLV. After reading the piece on TSI and getting a buy from another source I follow, I think the miners are set to explode higher. “Super force signals” is the other source I follow. this was his latest recommendation.
Thanks Poly. I think I might consider scaling back in and take it as it comes, bit by bit, buy on the daily lows, then if a pullback comes… go all in. I was looking to buy at the opening this morning with the lower prices, but held off thinking it might be the dip starting, but no such luck.
Pima, just saw your post to me, Wednesday is the day, and those just speculating exit their positions with a kick in the pants from the smart money that knows they must exit.
This time, the markets are closed for two days prior to that day, and my view is it allows for some short term games to the downside.
Funny how these things happen around Gary’s daily tops.
>>A central bank does this by first crediting its own account with money it has created ex nihilo (“out of nothing”).[1] It then purchases financial assets, including government bonds and corporate bonds, from banks and other financial institutions in a process referred to as open market operations.”<<
Notice that they say the central bank “credits it’s own account”. Even this quote doesn’t go so far as to say they use cash money to buy bonds, and I can assure you they don’t.
I would welcome a big shake out…as would most, I think. I think you hear the chatter that there might not be one because some of us (myself included) are getting impatient for a better opportunity to add!
Catbird, Gary said that the moment you can’t wait to enter anymore, itchy trigger fingers, that is when the correction will happen, right after you get in. So we sit, damned if you do and damned if you don’t. 😉
Wish you were here trading with us still…you’ve been here longer than me, and you should ride the whole trip with us I.M.O.
BRIAN
Are you using windows 7?? Thats the only way I know (other than subscribing to Stock Charts) to post a chart from there.
Thats why at times , I am on my laptop, and mention a trade but do not post a chart. My laptop is windows XP and cannot ‘capture’ a chart from that site. I have to use my home P.C. with windows 7 to CAPTURE one from ‘stock charts”.
Nitro, I have forex on my trading platform (Trade Station). So is that how you can trade 24 hours? Hmmm, didn’t know that. I will call my guy tomorrow to see if I am set up for it. It comes up if I select the link. Just not sure if it is usable on my accounts.
forex markets open virtually 24hrs so I’d suggest you get it. if the parabolic move hits overnight, we can get out at the top and let the suckers with stocks run towards the exits come 9:30am. LOL
Ok, so I need to investigate forex markets. Are you buying the same stocks or different products on forex? I will go in and read ab out it and see what I can find out. Any recommendations on what Gary is advising that trades on forex?
Wes, One last thing, then I’m going to call it a night. I should have included a number 3 in my prior email to include QE…so here it is:
3. The Fed purchases assets from the banks (MBS, treasuries and agencies in QE1 and 2-10 yr. treasuries in QE2), using funds (again electronic debits) that they effectively create out of thin air. The banks must then reinvest these proceeds in other assets and investments. Again the Fed may not be “directly” responsible for this additional liquidity chasing risk assets, but the Fed provides the banks with the capital which then makes its way into the markets.
And this is just QE, and doesn’t include all the other liquidity facilities that the Fed provided during the 2008 meltdown.
Wes, One last thing, then I’m going to call it a night. I should have included a number 3 in my prior email to include QE…so here it is:
3. The Fed purchases assets from the banks (MBS, treasuries and agencies in QE1 and 2-10 yr. treasuries in QE2), using funds (again electronic debits) that they effectively create out of thin air. The banks must then reinvest these proceeds in other assets and investments. Again the Fed may not be “directly” responsible for this additional liquidity chasing risk assets, but the Fed provides the banks with the capital which then makes its way into the markets.
And this is just QE, and doesn’t include all the other liquidity facilities that the Fed provided during the 2008 meltdown.
with forex, I’m buying paper gold (10oz/per contract) and silver (500oz per contract), and oil (100 barrels per contract). so whatever you hear reported on the news pr gary’s report, you are trading at that price. I have stocks in HZU/AGQ and SLW but they are small compared to how I play it in the forex market
Nitro, do you trade out of your same account, that you have set up for regular equities, stocks, ETFs, options or is forex trading out of a separate account. Can you trade forex in an IRA account or a regular margin account? I see that I can open a forex account for $5k to start.
Catbird, I chickened out today. Took my profits and ran (turned off the computer). I really need to get my head together tonight. I’ll be back tomorrow with a game plan for sure.
Nitro, Glad I saw your post, I sent my broker a request to send me forms. Since i am out of the country even by sending by email and fex ex, it won’t get back to them in time to trade this C wave, but gives me something for the A wave to get into. But definately cool, will get into this. I tend to watch the night markets as well, so why not?
my forex trading account is separate from my stock accounts. stock accounts are in the form of tax free savings account and self directed rsp account. forex account is with the UK forex.com. Got in before they made it mandatory to disclose social insurance number so *technically* my gains aren’t reported to the canadian govt. 🙂
Nitro, Razvan. I have a business entity account I trade through for income/expenses so I may set the forex account up through that. However, the bulk of my funds are in IRAs. Will have to see what I am able to set up in the US. Thanks!
regular account not IRA. Forex accounts are quite exotic investments so i doubt you can trade currencies with IRA funds. You have to be careful not to get caught up into using to much leverage because you have the option of going up to 100:1 on some brokers 😛
I saw that SLW trend line break too, good eye. Kind of looks like a falling wedge pattern.
I’m starting to think all this bearish talk about the miners is just what the doctor ordered to launch a massive rally. Take the contrarian view here. Not gonna chase AGQ at this point unless we get a nice sized dip to the 10, possibly 20 MA.
Bamster-That link wasn’t working and I couldn’t find the article.
Saw this one from Stewart Thompson regarding the miners. Interesting.
Nice report Gary, ‘ol steel nuts. In future editions, can you pls post what you’d do if you were underinvested? I don’t have a core position is why I’m asking. Thanks.
Poly, like KAL requested, I too would appreciate it knowing when you get back in, and into what, and why. It’s good to learn that you wait for pullbacks. I’m new here and am following Gary for now. Thanks.
However, how is “Superforce SIgnal”‘s track record?
I have read his reports as posted on various web sites. He is wildly bullish and has some good calls, but he also just ‘buys’ all the way down through a correction, so he is in the green at every run, but his actual ‘price targets’ have not always gotten hit.
Jayhawk
I read that report too, I particularly liked point 16 onward 🙂 I was biased though , waiting for these miners to move!
I thought I read that POLY simply went to cash ,not waiting for a pullback to buy, but ecause he was going away on vacation and didnt want to be invested if the markets had a large correction.
Alex, I am a member at stockcharts. Only have windows XP. I have seen other people here post their charts, but I’m not sure how to do it properly. I find jing cumbersome.
I use screencast.com, BUT…to clip a chart from stockcharts.com, you need to be a member (they’ve made it so that you cant copy /paste charts like you used to.’
On my desk top I have Windows7, and they actually have a ‘clipping’ feature that clips a chart from anywhere.
I am not a member at stock charts, but I know that there are at least 2 ways you can post. Here is a link to a guy I follow who has a portfolio of charts for public viewing.
For me as a non member, the way I do it is I go into the chart and there is a “linkable version” button I can press. However as a non member I can’t post annotations, just the regular view.
Sorry – this may not be a big help – you might want to check out there help menus. I would bet that you can do it with XP.
@hotrod, I own July 50s too, with avg cost around .80/-
To answer your other question, I like to scale out slowly once I start getting my pre-determined target probably around 30-40% and go from there. I have learned to take profit at regular intervals, and if the trend is strong then I will keep adding too.
Super force has a very good record. They have different buy and sell stages. There latest recommendation on GDX and GDXJ were given yesterday, and were both strong buys.
Bill, Here’s the thing. Some people sold everything expecting a correction. Not the best strategy in a C-wave finale.
I sold 15% of my AGQ position to convert to DITM call options on SLV. I wanted to add a little more oomph to my portfolio. I tried to pick the top as best I could. But obviously I missed it (pretty tough to do in real time). But I am still heavily invested despite taking down 15%.
The risk is that one could sit and let a runaway move get away from them because they are afraid of a minor daily cycle correction. Gold is very late in the daily cycle so even if you end up buying at the top the correction will be brief.
Then the next cycle up will begin. This still has a good ways to go yet. Is it really worth missing the first half of a runaway move to try and avoid a minor drawdown?
Probably not. I would say at least get half of your intended position at the open and that way you have some skin in the game in the event a runaway move does get started.
And if gold does correct then you also have some dry powder in reserve.
I tried that linkable version, but when I click on the link it takes me to my account. It made me gun shy thinking it would expose my account. I guess I need to hear from another stockcharts member to be sure or test it while I am close to another computer I am not signed on with….
Thanks Alex for the feedback on “Superforce Signal”s.
Of the free sites I follow which do have a fairly good track record (in my opinion):
1)Turd Ferguson (he as been correctly bullish these past few days) thinks there will be a pullback next week- this aligns with the the options shennigans expiration on 26th-28th like we saw last month.
2) Jesse Cafe’s- he is always cryptic (I think English is not his 1st language) but even he seems to have scaled back on metals today at close.
3) James Turk – disappointed that he did not issue an explicit warning for short term correction- but instead he expects 50$ silver by end of June.
…at ease, Be very careful with Forex. It is highly volatile, and can wipe clean accounts if you aren’t careful. 2 things; Never hold tight stop positions over the weekend, and Never take a position that is 2-5% of your total account value. For most, that is Mirco Trading. I made money in Forex, but I’ve also lost a lot of money. I haven’t traded in about 2 years, miss it sometimes, but not the grief & sleepness nights wondering it the trade will go the other way, in an instant.
Thanks Alex, I will re-visit my screencast account if I can’t be happy with how stockcharts does it. I have seen people do it from stockcharts so I’m fairly sure it can be done right.
The Ben Bernank is just trying to keep prices stable while maximizing employment…what’s so creepy about that?? heh heh
Well, he has AUDIT inscribed in his forehead, so I was afraid the S&P would AUDIT and downgrade him too…before he’s done printing and the C-wave finishes it ‘thing’ here.
Gains and subsequent Corrections since end of January. It is very interesting to see that after every gain of $4.50+ in Silver prices, there is a correction. Nothing to do with Gary’s analysis, just some patterns I am following and thought I should post for fun and any comments.
Alex, Poly might have said he wasn’t buying but . . .
4Life – for me, it means hold tight. But ultimately I’d say their reappearance is a sign of increased profitability for all!
I’m desperate, I admit: Catbird’s sacrifice evidently hasn’t taken hold yet. Response to my nightly descent dreams? Nada. I’ve even started singing “GO DOWN (Moses)” At least it’s the season . . .
What is the best way to enter an options position? Let’s take the Jul $50 SLV for example….
Bid / Ask is $0.95 / $0.98.
Would you put in a limit at the bid/ask/in between or below bid and let market come to you?
Let’s say one wanted to use the morning hours “weakness” time periods to buy into the calls and try to get the dip, but the farther out of the money options aren’t as liquid?
With these options under a dollar a penny here or there can make a lot of difference, right?
Today, it was actually down 2 cents or 2 percent whole many of the other options were up.
Agreed- if only I had followed Gary’s advice all along, I would have sold off a lot too early, and would NOT be now scouring other websites looking for upcoming “correction” signal to make myself FEEL BETTER!!
SD Jack, Thanks for the forewords. I think you can do that with options also. Good to know upfront, as it’s not fun learning the hard way all the time. 🙂 I want to investigate fully before getting into forex. For now, I need to pay attention to this C wave and managing trading 6 accounts. If I get through this, I will have time to look at my other options, but can meanwhile get paperwork processing if it is something I think I can use.
One of the things I learned from Gary was not trade and sell thinking it is overbought or oversold. Once you lose your position in the bull market, it becomes difficult to buy back in, trust me, it will be very hard to get in again because you will always want to catch the price lower than your sell price. Then it is too late and the price will keep going higher and you will never be comfortable to get back in.
Think of it this way: What’s stopping AGQ from hitting $330 (<10% away) before the PMs correct?
Well, maybe the long-awaited correction takes AGQ only back to $290– a $40 haircut from $330. That’s barely below where it closed today. Yet, I think it would make ill-informed latecomers soil themselves.
You’re right, CatBird. Absolutely right. And I’ve never found myself frozen in the headlights like this before. So I’ll muse over my complexes OFF of book time and get back to the reality of the numbers. Thank you for that!
“Vando” – I like it. Makes me feel all broad-chested 😉
Vonda, I always see what the low was the day before and see if I can get in on that. If it looks good, I am getting back in tomorrow also. I preserved my profits since February, but need to get back in the game. So if it looks good will scale back in slowly on the best buys in the selections of funds. And save the rest for corrections or dips. 🙂
posted last week…..I think we are going to see a shot at 43 by close..(which I hit dead on nuts) Now we would have to see a $2.70 pullback just to hit 40 again from last week. Now for this “pullback we would have to see a $4-6 quick pullback for a decent pullback… $4-6 buck quick drop seems unlikely IMHO…. Anyone wanna follow my blog????
Lots of sympathy on procrastinating entries I am at 95% and comfortable for the day, now is that worrying? I,m sure I should be more fearful! I,ll probably get the fear when a scary correction hits or an even scarier run away move I loved the Dallas data too. Damn… In the end though I,m more concerned missing exit call at the top what with work and all sucking up time Lol in the am all
Catbird, Not all cash but about 85%. I’m usually 100% so this is kind of different. I’ll post my plan when I figure this out. GN all. Tomorrow looks like it could be interesting by the overnight action.
Gary, Are you still shifting voer from SLV/AGQ to GLD at a certaqin price and are you still out at $50? Or has this runaway action going to change that plan? Just checking cause we are getting close to both. Thanks 🙂
If the dollar can’t correct and gold gets into a runaway move everything will change. I will probably take profits at $50 and then see if silver can break through.
You’re treating me well, CatBird. Thank you for the blog posting. Another angle I hadn’t really considered ’cause I didn’t know the particulars of it.
(Still up. Still staring at 1500.)
I had thought, “Gee, if I were long–and getting nervous, what would make me more nervous? Holding through an extended weekend. So maybe wait it out and see if there’s some divestment on Thursday. If not, I probably won’t lose too much more opportunity cost and I might just catch a dip.”
But either way, I’m holding my nose and taking the plunge.
I think you are seeing something that is not there, the money supply has clearly grown far and beyond anything in 2009, except possibly the M3 measure.
I am curious to know what you think the FED uses to purchase bonds with when they perform POMOs.
Im still sitting on the sidelines. Im not bothered if i miss this runaway move. My rules state that i will only buy after a pull back or a consolidation that shows some form of basing for accumulation. Personally i still think that dip is just around the corner.
Gary, I can’t get the April 19th report and I’m not getting an email from you for a new password (I’ve tried twice). Please help (I’d hate to miss the C-wave 😉
I sorta figured you’d say go buy 1/2 now and 1/2 later. Makes sense, though it sure is hard to take an inital position – weak hands, and weaker kahunas.
Market open is like midnight for me so I’ll see what muster I can manage at market close. Sure is hard.
Is taking an initial position late in the game near the top of a large C wave hard for anyone besides me? Any remedies?
Bill, I am fully out and jumping back in tomorrow. I look at it this way even if it drops it is supposed to be quick drop and back up again and will just go higher. Would rather have my position than miss it totally waiting for the dip and if it happens on the overnight hours, out of luck getting on the Bull ride. I am getting in a bit higher than i got out and preserved profits. But would rather get in now at least 1/2. Going to try for best prices tomorrow, but getting on board. Just pick your top two or three to start getting in.
now that most of us are highly invested in silver, what specific parameters or clues will we look for to pull out of silver? Its always easy for me to get in, but selling is the most difficult part. Will we wait for Gary to send us a sell off signal?
So Gary, I’m trying to get the nerve and all. I’ve noticed some chart things that have me concerned.
– Price is stretched way above 50 & 200d EMA’s – you wrote about this many times before – true, a parabolic move won’t care – but you’re right that it will snap back and hard
– FXE went up w/the Euro, but look at the volume – I just noticed this – it was strong on selloff Monday, but weak Tuesday.
– Same volume of heavy selling and weak buying on SLW, GDX, and GDXJ as well. But not in GLD nor SLV.
The net for me is, if this next rise higher lasts a month or so, maybe it’s best for me to see what the $USD does. I just feel high risk seeing RSI’s at 84, and PPO’s at 5. I think that I’m glad I joined your services, but I think that I’m hard wired (perhaps a bit like Poly) to buy only on a pullback. It it goes to infinity w/out me, that’s OK w/me. I didn’t loose anything, I just didn’t gain. And I don’t mind following you into the next A wave and doing it right from step 1. I am a beginner, after all. I’ve never traded in my life.
Is there a chance we test 74.23 on the dollar like you once expected and then get the dollar daily cycle later this week. My gut feeling is people may be getting ready to chase this market because they just can’t take it anymore fearing a runaway move. Then just after they get in here comes the nasty correction you previously expected.
Any thoughts? Thanks for all the hard work. BTW I just got trader Vic’s books yesterday, can’t wait to read them.
The beauty of using PicPick over MS paint is that it opens automatically when you hit the print screen button.
If you hit “Alt” & “Printscreen” it it automatically captures the entire screen.
If you hit “Ctrl” & “Printscreen” it puts a red border around the images on your screen which you can move with your mouse. You just move the red border to your chart and click the mouse and viola’
what books? I’m interested in learning too! I’m a newbie at this technical trading stuff.. does anyone recommend YTC price action trader from yourtradingcoach.com?
I think you still need to save the screen shot as a GIF file before you can upload it to photobucket or similar, which is why you have to paste it into paint.
Greg, So what if the correction starts after you buy. It’s so late in the daily cycle that it should only last 3-6 days and then we’ll start another leg up.
Is waiting a few days in order to catch the rest of the move from say $44.50 to $50 worth a minor 3-6 day dip?
Of course it is.
The dollar has now given back all of Monday’s gains so we obviously are now looking at a dollar cycle that is going to stretch. Since the dollar cycle tends to turn on the Jobs report most of the time we may have another 2 1/2 weeks before the next short term bounce (which would in theory drive a short term correction in the metals.)
One other thing Gary about my hesitation – earlier today I studied your Cycle charts, and was really impressed. Like you said they are not precise, but they do happen pretty regularly.
And in particular, the $USD is due for a low now, just like you said. And I agree w/you that if it does dead cat bounce a bit, that $GOLD will likely take a hit, and $SILVER even more so.
So your Cycles magic is another reason for me to wait for it. This plus the distance from the MA’s is pretty compelling.
If it doesn’t correct, and runs away instead, the move won’t last long I bet, and it will slam back down hard, like to the 200d EMA or something.
My personal belief after reading a bit is that this whole silver thing is short covering anyways.
Gold has the fundamental financial story behind it. And it will correct, and you’ll guide me when it does. Also, this gold bull will last many more years. The whole friggin’ world is in serious debt, in all currencies. No need to panic. I learned my lesson and have found a better guru.
Gary, Aside from the obvious stretched dollar cycle, is it possible OPEX and holiday weekend (decreased volume) is allowing the correction to be delayed until next week? Maybe a nominal low of $USD to suck in the latecomers before the ‘scary’ drop. Great lesson to learn for those of you that sold your turkey!
I think that as long as everybidy is waiting for a correction it won’t happen…BUT I am not buying here either…Like you Bill, I prefer being a spectator…
Hey Fergie, What part of the world are you in this week? 🙂
I’m going to go with the dollar cycle stretching to the next jobs report since they have a strong tendency to turn on those. That would also set it up for a normal duration cycle into a final three year cycle low on the June report.
Thanks, but I was still unable to clip a chart from my laptop using that method. I just tried 3 times.
I was actually able to copy or’highlight’ the chart and ‘paste’ onto paint though , and then draw on it.
My problem is that I like to use the feature on stockcharts to annotate a chart. You have to click on Java or Flash, right below the chart to do this, but then it wont allow me to copy it or capture it (any way I know of). I can ‘clip’ it using a clipping feature in Windows 7 though.
By the way…Gold/Silver…Wow. And the Futures for SPX and Dow are way up..maybe a little miners action??
Power corrupts, The next 4 year cycle low should come sometime in 2012. As the dollar crisis intensifies in the next month it will spike inflation to the point where the economy collapses again initiating the next leg down in the secular bear market for stocks.
That should correspond with another brief deflationary period and a strong dollar rally out of that three year cycle low lasting a year to a year and a half.
Would it be a good idea to lighten up on some positions before the jobs report? Also are you planning to sell all your positions once silver reaches 50?
I’m still stateside. Looking at the JH vacation home next week. Ironically, I’m struggling with similiar entry fears that I’m seeing here, except mine is related to real estate. Too bad, I can’t make an offer to the bank in physical ounces. : )
Niven, It depends on if gold has entered a runaway move. If it has then the dollar will become irrelevant (well other than the final three year cycle low).
All corrections will fall within the standard range and there is no way to determine when they will occur.
I’m wary of this cyclical equity bull. Went from 90% equity allocation to 10% back in November in 401K’s with no PM options. Plan to be 100% cash by the dollar 3 year cycle low with the hatches battened down. I agree with you that there’s a tremendous amount of downside risk in the S&P at these levels. Will look to reengage around the next four year cycle low.
Fergie, what I’ve read from Robert Schiller (Yale) is that if you plan to own for 5+ yrs, though the market goes down another 10-30%, it will flatten out, like forever. So if you’re OK w/the final dip, and if you love the home, go for it. You’ll be dead in 20 yrs anyway, so go get what you want.
Gary, looking at your $USD cycle chart again, I think we’re due sooner than the next jobs report. You know I don’t know squat about this, but if history is a guide, the way you marked the chart w/the blue arrows, and count the months between them, and project forward, we are due now – as in NOW – in fact, we are late.
Fundamentally, I can totally see it happen, w/Greece or Portugal or Ireland blowing up again. Currencies are all relative as you know.
I’m going by CYCLES MAGIC on this one, man! I will sit in a full lotus zazen, quiet and breathing, until it comes.
Why not get in now? Just designate a small position. Perhaps 10-20% of your cash if you are really worried. If gold corrects you’ll be more confident to invest more when the price goes down. I was really worried about getting in too…heck I waited 2 weeks for a correction but it never happened. I’m very confident silver will reach 50 anytime soon even with the dips along the way and I’m sure Gary will provide an excellent timing for us to sell off our investments when the time comes.
For those reading your report , and seeing the Dollar where it is now…I guess since you mentioned that the ‘rest of this week…’ would be critical in analyzing the dollar -may not matter quite as much? Like , we got what we were looking for already, so now we DO see whats unfolding here?
Sorry , Not a crystal clear question, but I’m trying to preserve the content of your report.
Bill, I have to ask. So what if the dollar choose to bottom here. (doubtful. If it was going to bottom it would have done it on the S&P downgrade. The fact that it couldn’t hold the rally says much larger forces are at work).
But back to my question. So what if gold corrects for a few days. Silver is going to $50 and gold somewhere above $1600. Neither one will top until the dollar bottoms.
Since the dollar is in a bear market that means at least marginal new lows. There is still a lot of downside left for the dollar and consequently a lot of upside in precious metals before we get to that point.
It’s like you are saying I refuse to make 20% because I might have to weather a 2-3% dip first.
Gold is above 1500$ as it was expected by Gary´s analysis before it might correct. Maybe the dollar has not bottomed on Monday but couldn´t it bottom today or tomorrow? Why not have the sharp correction now? If a parabolic move is starting wouldn´t the big investors play every trick to knock out even us following Gary?
Right Sophia. Plus the market is wondering now if QE2 will extend or not.
Fergie, no death wish, just reality. If you’re Gary’s friend, you’re in your 50’s like he (and I), so odds are … Just get what you want and be happy. A house is a home. Screw the money. You are a human, and need to live.
Niven, if SIL rises above it’s recent pivot high of 3 days ago at 29.5, it’s a breakout (in my model) so taking a modest position as you and Gary suggest is a good idea.
But, I want to give this Cycles Magic a try. Who is waiting for it? No one, thus it will happen. I remain in seclusion in my zazen position, breathing and waiting. It will come.
Since I’m out of miners as of last week, and I won’t get caught chasing with any significant size, it looks like another day of standing aside patiently. Physical is my only position for now, and I’m not selling that for several more years.
Congratulations to those still long AGQ, what a ride! 🙂
so there are some pretty sophisticated investors on here. Are their any ways to make bets on severe weather patterns in specific geaographic areas. Insurance pools, vegas, etc ?
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What is the rationale for selling more silver when you still believe the weekly cycle in silver has not topped, Gary?
Thank you.
Today is a good example why to dump under-performing stocks. They get massacred on a market drop.
Because we are now overdue for a correction and I may decide to deploy that capital into DITM calls to juice returns above and beyond AGQ.
Hey we only get a C-wave finale about every 2-3 years so one has to play it for all it’s worth 🙂
Ok Gary, that’s it! I am going to ask my husband to take care of the kids for few days so that I can come to Vegas and learn about cycles!!
Squirrel,
Actually the better names (AG and EXK) are now getting hit vs. the laggards, but your statement is typically the case.
If gold continues down to closing, what number must it reach for cycle high to have been formed?
HUI getting murdered…back to the trendline that it broke out of …
See I think stopping price just a hair under those big targets (1500 and 300 AGQ) was fascinating. Everyone was expecting those levels to take profits and now folks are staring at huge reversal candles wondering what to do.
MR Miyagi,
Gold made a new high today…can’t form a swing high today..we’re set up for one tomm
This is going to be a real ugly intraday reversal if we close down. Will be a great buying opportunity in a few days though. Congrats to those who sold the news this morning.
DG,
You still have a core in silver or AGQ?
Nike Boy2008,
Thanks, I went and re-read terminoligy.
TerminolOgy….
Checking in
Once again, a bull market will have only one correction that exceeds 10%. We had that correction last summer in the S&P 500. So unless we go below 1209ish, the market is just making a new base for the next move higher. We don’t even have a lower low below 1249 yet and folks are calling for a bear market. Especially after some were calling for new highs just a few days ago. Talk about getting control of one’s emotions. I don’t trade fundamentals BTW. 🙂
Gary and others,
If one is looking to juice returns for the C wave, wouldn’t silver futures be a choice?
DITM? Educate me please Gary.
DITM = deep in the money…
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Any targets on where SLV could bottom out at on a correction here?
Are people feeling like a deer in headlights here?
Just want to get the convo flowing as to what people are planning to do at this point?
Still holding old turk? Or unloading some and booking profits before the low?
Gary, can you elaborate as to why you wait for 5 min prior to close?
Thanks
On my IB stock watchlist i see notice on AG “short sale restriction in effect from …” and the date.
Seen that on other miners on big down moves before. Is this some automatic stock market rule or how that happens?
New York: I did a lot of trimming last week (maybe more than I should have). Am now “eagerly” awaiting a correction so I can put all my money at risk. 🙂
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What holds true for equities (topping on good news) will also hold for other assets(PMs). Gary, the question right now is when to get back in??
One thing which might happen now is that the Congress will start making the right noises.
The US$ index is acting like a senile old geezer.
Gary, why are you wating until a few minutes before the close today to make your move? Just like to hear your reasoning.
PC: Yes still long. I only own AGQ now (sold virtually all my miners and SLW a good while ago into strength—got a little lucky to catch the highs) I have been afraid that we might be in the final blow-off stage and am so far ahead I thought I’d sit with about 30-40% of where I want to be in AGQ. Looking forward to the coming bottom.
Gary is still expecting that we haven’t seen the top of this cycle yet. The target was $1,500 on $Gold, maybe a little higher. That’s why he is waiting to see if today’s action is for real or a fake out. That’s the way I interpret his thinking.
To buy or not to buy…
Patience, squirrel-san…
not to buy of course.
A big reversal in silver would likely mark the top. We won’t know if we have actually reversed lower until we close. I will probably lighten up a little further as well. I think that’s a fine thing for people to do IF they are willing to buy on strength if they/we miss the bottom. And IF they won;t get scared and fail to add at the bottom waiting for a “little but more of a decline.” If you might balk at either of these, don’t get so light that you will kick yourself if they take off again without you.
Mr. Miyagi you crack me up..
The weakness expected will be quite shallow, since the lower BB is rising fast, and the dollar is rallying hard as is… should be over by week’s end, and will probably bottom in the 1440-1450 range.
Long 6x. No changes.
I still believe good chance we are in the runaway phase and that this week will end up strong.
slw pretty beaten up but AGQ is holding better
If that’s a dead-kitty bounce on the US$ index, it’s going to need a cathedral ceiling.
torero,
If you had read the weekend report you would know that the coil pattern should reverse to make a new high. It has failed. That’s a bad sign.
If the market drops below the Japan bottom we will have a left translated a failed intermediate cycle. That is a sign of a bull market top.
This is why I don’t depend on charts and why cycles work so much better. I will have spotted the bear market long before your charts tell you that you are in trouble.
The market has broken below the half cycle low. That is a bad sign. If I had money in the stock market (I don’t) in an IRA I wouldn’t be waiting around any longer.
We are now in the timing band for the secular bear to return. It’s too risky to continue to hold this far into a cyclical bull market. The potential upside is too small and the downside risk to great especially with the market not acting like it should be if it were going higher.
selling further into this small intraday bounce in the gold miners
For those who asked I have to wait till the end of day before I will know if the metals actually do form a reversal candle.
Both SNP and HUI on target for a BB trade if this holds up!
/DX screamin higher but no PM drop…?
I am getting close to a buy signal on SLW. One more bad day ought to do it. If it comes anywhere near the timing band for a gold bottom I will be forced to buy it (can you see the gun at my head?) Heck, even on a reversion to mean basis it ought to rally having been so trashed. By the time something shows up on my buy screen it is very seriously overdone on the downside. It will bounce, I’ll put in my break-even stop, and we’ll see if it can get legs. For you option guys interested in taking a shot, it’d probably be a good call play. I will post if I get the buy on it.
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DG,
I was looking at SLW and thinking along the same lines wanting to top off a couple of calls.
Mr. M—not yet though, I don’t think.
DG,
I would appreciate that signal. Thanks
Vonda,
No, my sacrificial trade has not been made yet! My finger is poised on the trigger though. It will be a very small amount of my equity if/when it is made.
Ideally, silver’s weakness grows throughout today. I’ll see where we are at the close.
DG, I am thinking $40 should hold on SLW. If it holds till the EOD, I am buying.
Gary,
The SPX essentially went straight up for 5 1/2 months. So far, all we are seeing is a healthy correction of that powerful move. The market is acting like it should. For us to continue higher, the market needs to load the bear boat again. I am mostly flat equities and will wait for confirmation the correction is over before entering new swing long positions. Selling pressure has not increased and buying pressure has also been muted. Classic sideways consolidation. Again, if we were to enter a bear here, critical levels will be broken and I would be ready to short the first powerful retrace. I absolutely will never front run a bear market. That’s suicide.
Last time SLW went below 40$ was a month ago.
DG,
Thanks again for your great, helpful posts. I enjoying following your trades and the reasons behind them, you are providing all of us with a great education.
Same goes for TZ, Alex, Poly and the other experienced traders.
You input, combined with Gary’s premium content, has helped me to dramatically improve my PM investing returns over the past month.
March 18th to be exact.
is GDX in a coil pattern?
Gary: Unless I am misunderstanding something, when you say something like you said this morning: “The dollar cannot have bottomed yet because it hasn’t formed swing low” you mean it hasn’t finished the bottom formation series of prints. By definition the actual low must be lower then the point at which swing low is established because it’s a rally that establishes the swing low. The dollar bottomed this past Thursday (that is, if you call the low the bottom). Today, I suppose, confirms it in retrospect. For myself, I’m glad I didn’t wait to buy EUO. I have found I am usually not buying at the swing low signal and instead buying when I see what looks like an actual low print to me.
DG or Mr miyagi,
Would either of you wait for a swing high in gold before entering a position in SLW? Would a swing low be the final confirmation of a buy signal?
Silver seems pretty healthy … despite stronger dollar and lower oil…what a market!!
Michael: I myself usually don’t pick prices. I find it is better to let the market tell me what to do. Gary is right, the obvious prices are usually violated to run the stops, get a little panic going, and then reverse higher. 40 of course could hold, but it may bottom at 41 or 39 just as easily in my view. If I had to pick a price I’d pick 38—the March bottom and where my buy would likely hit. If I get the buy and we are at 38 I will definitely buy it, but without my buy for me it’s just a guess and not worth betting on.
Gotta: My pleasure. Mail checks to…
Wav_ridah,
Waiting for a little closer entry to the silver swing low, the final wave.
Can’t time it perfectly but that’s reality.
DG,
yes we have a swing on the dollar now so it is possible to have the bottom.
Torero/Beanie?
The market should not violate the half cycle low. If it violates the Japan bottom then this bull market is toast.
I think Beanie is out refinancing his house so he can keep holding his favorite group of semiconductor stocks. Man, I was short SMH at the top (36.50) but wasn’t convinced enough to just hold it. Next time I might take fading Beanie more seriously. Dow 30,000 here we come! If we really are toast I look forward to shorting, but my primary attention and capital now is on getting the next gold daily cycle low. Once the C-wave ends we’re going to have fun on the downside. Alex, I’m gonna get you short, my friend! They go down a lot faster than they go up.
I think the bottom on the miners may be in. Could see a retest of those lows on further metal weakness.
Love how Gary’s triangle pattern is behaving. Intra-day dip under it but a close over 574 would be nice.
That dip also looked like a tag of the 50% retracement off the March to recent top move.
HUI
SIL resting on it’s 50%. Zone under looks like good support.
SIL
SLW hit it’s 78.6% number. Extremely oversold.
SLW
I’m starting to think about adding 1/2 my mining positions here and 1/2 at the confirmed low.
Those who play the miners I would love feedback
Not Beanie! Don’t try to change the subject. 🙂
Gary,
What would you look at to confirm the dollar’s swing low making a bottom? This would modify the expectation of a touch/break of the prior low, right?
Thank you
Gary,
You said earlier today that the stock market has broken below the half cycle low. Why couldn’t today’s low end up being the half cycle low? (And the 4/14 low was just one of several lows on the way down to the half cycle low.) Or, if we go lower tomorrow, then tomorrow’s low could turn out to be the half cycle low?
Seems like we can’t know for sure until we see what the market does from here. If today’s low holds, then today’s low will turn out to be the half cycle low, right?
Jayhawk, SLW could well be putting in an exhaustion candle right now. I am tempted to buy some calls here.
In Demark land today, DXY is responding to its 1-4 Bar Buy Setup on Day #4. Kevin Depew in “Five Things you need to know: US Credit Downgraded by S&P” sez: “After all, did the S&P futures not just drop 10 points on ‘news’ of the S&P downgrade? Sure, but the long-term patterns of markets reveal in time that such apparent exogenous factors are a bit like gnats biting a buffalo. In my DeMark analysis, the US dollar needs a new low, below 72, and possibly even a move below 70, crossing the round to help foster more dire headlines and warnings. After that , it will be over.”
So, it appears that Depew is lining up more with Gary’s chart from his weekend report, so DXY 72.5 may not be such a line in the sand after all. However, I don’t agree with Gary’s chart that DXY will probably not go back much more over 80 – if we’re looking at the return of the bear, DXY pushed 90 two times in the last 3 years – at least give it that…
Depew also looks at silver again in his “market notes” of the Buzz and Banter. Not much new, but here goes:
DAILY: Minimum requirement for wave 5 up has been met, but we are only on Bar 4 of potential Sequential 13 Sell (minimum of 9 days) Next TD Absolute Retracement target up at 45.32
WEEKLY: Weekly has met minimum requirement for Wave 3 up as well. TD Sequential 13 Sell signal occurred the week of April 1, but the upward momentum continues.
MONTHLY: This month is bar 12 up of a potential TD Sequential SELL signal
QUARTERLY: This quarter is bar 8 up of a Sell Setup and bar 10 of a Sequential 13.
YEARLY: This is bar 9 of a Sell Setup which will record – 1-4 year downside reaction forthcoming
Depew reiterates that he is making sales this year because he believes the long period of metal outperformance is ending, but remains a long-term silver bull, especially versus gold.
Please excuse me i may be missing some fundamental pont here, but if the dollar has posted a half cycle low and is now turning up shouldnt that put additional pressur eon spot gold which in turn would result in increased selling pressure on gold miners particularly those with the greatest spot exposure
classic full moon action!
nice drop in euro and stock market and copper, nice ramp by grains and precious
http://astrocycle.net/index.php?Menu=Astrology&SubMenu=Panics
on April 19-20 in history: — Start of Revolutionary War
— Battle of San Jacinto
— Start of Civil War
— Start of Mexican-American War
— Start of Spanish-American War
— America abandoning the Gold Standard (not the Nixon one)
— Failure of Bay of Pigs Invasion
— End of Viet Nam War
— Largest battle of warships since WW II
— Explosion on USS Iowa
— The BP Oil Spill in Gulf of Mexico
ahain: I agree with you. I do not believe the miners have bottomed yet. Heck, silver has been down for only three hours! We ought to have at least a couple of days where the metal and the miners are both down, but we’ll soon see.
I thought that Gary was expecting 3$-6$ selloff on Silver, not 0.5$ selloff…If so, why is everybody trying to buy today??
Jayhawk,
Shouldn’t we wait for the daily cycle low in gold to form? If the miners hold their current lows while the metals dip down, that would be a positive divergence and a sign to get back in. Of course, they could always drop lower.
sophia,
I don’t think any here are adding SLV or GLD.
Sophia,
I am not buying! (yet 🙂
I don’t get the impression that folks are buying just yet. Some have looked at the miners and are salivating a bit.
I have to wonder about the metals, though. What will cause them to go down for more than a few hours (other than the climax top of the parabolic move)? So I wonder whether we will get a recognizable daily cycle low at all.
DG, im waiting for the fear factor to kick in, it still looks a little too comfortable to be on the long side right now. Probably a good time to look for some cheap mining stocks. The question is given the C – wave, it would probably be better to pick outperformers rather than underperformers. If we were at teh start of teh move my preference would be underperformers, but at this late stage surely we have to stick with the Silver Wheatons. What do you think?
I must have read something about strong support for SLW somewhere then…Thanks Miyagi-san, it makes more sense to me…
I’m re-establishing my positions in the miners, I’m buying strong sell off days all the way down.
SLW is way over sold.
Miners may have sniffed out the daily cycle top and they may sniff out the low. I’m looking for a very strong rebound the final daily cycle in the miners and for them to lead up out of the correction.
I see limited downside here for many of the tickers I follow so I added a % of my target allocation.
got it PC! thanks
One issue that was on the table in August’s runup, yet has not been mentioned here at all by Gary, is the potential of a runaway move developing.
I am not touching anything…Tried a small long on NSQ and barely broke even, so will wait for another day to touch anything of my position
Gary what are DITM calls??
Deep In The Money calls.
Sophia: I have no idea why people are buying today, but I assure you it’s not “everybody.” SB waits for weakness as do I. I bet neither Poly nor Alex are buying today either. One of the great things about this board is that you slowly find the people you want to emulate. Poly’s SPY purchase last week helped nudge me into buying as well. [I hope he sold when I did though 😉 ]
dumamae – if you have to ask, you’re not ready to buy options.
that said, it’s never too late to learn. there are many free options tutorials available out there. gary also discusses his particular options strategies on the subscriber site.
As in the stock is 50$ and you buy 42$ calls. A 48/49$ call would be in the money. A 51$ call is out of the money. A 60$ call expiring within a month is a lottery.
I agree with you that considering the price action, I would not touch it, but there are so many comments talking about itchy fingers that it makes me wonder…
ahain: For myself I am sticking with AGQ and SLW if I get my buy on it. I will post other names if/when they show up on my screen. The which is better, and underperformer or overperformer is a good question. I’m afraid it’s one of those things I do by feel at the time. Either can work well.
DG
I’m not buying yet either. However I do remember Jayhawk was among the few who bought AGQ not to long ago at 130 as it bounced off the 150dma. I know enough to know I really am not good at this so I will just wait for Gary to add his options on SLV, that will be close enough to the bottom for me.
DG. Effective Volume may help with the stock picking. More here http://www.effectivevolume.eu Im not plugging its not my site and they charge however at monest.net http://www.monest.net/charts/ they have a free charting package they have a free online charting tool where you can select these EV indicators. Fundamentals, relative strength dont work, the EV tool helps me to see where big money (big volume) is placing their bets.
Just to add, right now the Large Players EV indicator is diverging with GLD, showing large players have been selling since 11 April
ahain: Thanks. I have been meaning to put more energy into studying volume, but I keep not doing it so I guess I am not interested in opening up a new area of study for myself. Too old I guess. I mostly spend time looking for my dentures. (That’s a joke, by the way. I played eight hours of volleyball this weekend, so no wheel chair for me quite yet.)
Wow, 8 hours. I spent 8 hrs digging a trench for hedging. Luckily my fingers are the only part of my body i can still move without too much discomfort.
Just as a side note, Goldmans report tomorrow, some of teh financials are looking strong. We could see the equities take off here led by financials which could add to the gold argument (weakness)
ps Goldmans looks like its being bought
So on a gap down tomorrow would be a good buying point. (ill go back into my hole now)
Jay,
What miners are you buying?
I see AG and EXK are both up 5-6% from today’s low.
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that monest.net charting site is pretty nifty, thanks for the link!
still long SPY, would have to see a close below the march 23rd pivot (/es 1278) to dissuade me.
St D. You’re welcome
St. L, nice to see ya. Good trip?
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http://apeakunderthehood.blogspot.com/2011/04/prelude.html
Prelude
Check out the latest post on a subject most do not appreciate
A peak under the hood,
Wasn’t this story reported a few days ago on ZH? I remember reading it
Gotta-
Those 2 and SLW I picked up today. But remember I was looking to build back a position after over scaling out. Of course we will go down further and I will just keep averaging in on the way down this daily cycle low. I can’t afford to be hand sitting if this thing decides to do what TZ thinks. (runaway)
This kind of reminds me of the QE2 announcement day on Nov 3rd. Deep into the intermediate cycle, gold and silver looked very stretched, people calling for a corrections, “sell the news”, was going on. The day looked like a sell the news event, but the reversed the losses and then we went on to launch to new highs over the coming days/weeks.
Jayhawk,
I’m holding SLV and SLW cals, just waiting for the drop to finalize purchases.
If it doesn’t materialize for some unprecedented reason, I’m placed to make money.
Today’s action started off great but is getting a little frustrating. Sure hope we finish down otherwise this could very well be a runaway move and we simply continue higher tomorrow.
May be forced to buy back what I sold early this morning.
Shalom Bernanke (and he should correct me if I’m wrong) said he was looking to buy miners if the .HUI got down to 565. Well, it bounced smartly off 566 this morning.
I’m not messing with miners much (90% AGQ with some NUGT and SLW calls) but those who are should be interested in that.
I thought this is all about the $, which looks like it’s putting in a solid swing low today. Or are we still concerned about PM decoupling w/ $??
nice tails on everything today
fake bounce or bottom (runaway move). this week promises to be very interesting 🙂
DG,
thank you for willing to post the SLW buy signal when you get it
MrMiyagi,
I was thinking of buying some SLW warrants at the daily cycle low. Have you had any experience with warrants?
1294 low on spx is 50% of 1249-1339
also left shoulder is also 1294.
now right shoulder also 1294.
I know this blog hardly cares for spx. but i think we get good PM results when spx up or at least not down much.
I wish more people like TZ were calling for a runaway move..haha
when everyone out there is expecting a correction (despite the sentiment),a run-away move sure seems possible (like TZ was mentioning) followed by a 25% drop in one day
wish Gary was the only one expecting a correction…unfortunately, the whole blogosphere is looking for one
The argument has been that a rising dollar should bring down the PM but as we can see, in the past 2 days the PMs have risen alongside the dollar so it isn’t perfectly negatively correlated. Plus in the past, the two have risen together for extended periods of time. Only time will tell as always….
I too am looking at PM’s seeming strength in the face of hearty increase in $$.
Is it too soon to say the inverse relationship is looking suspect?
Rob L,
No, I try to keep it simple, stocks and options. I rarely short as well.
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Miners and metals got rocked in Jan in the face of a falling dollar.
If a three year low is in front of us on the dollar, we could see a sideways correction in gold and silver and then huge launch.
if SLW closes flat or green, I will buy at EOD (for a quick trade)…SLW has one LONG tail to ignore
Picture perfect tag of SLW 78.6 level with a HUGE tail in that hammer. Also that 40 EMA looks to be holding!
http://www.screencast.com/users/Jayhawk1991/folders/Jing/media/ea2ca299-9490-4277-bcd5-0ac411cba723
BOy AGQ has been volatile today. Easy to see why Gary is waiting until the close to make a determination.
catbird,
You’re correct, that level sounds good, but remember price levels are secondary to price action (direction) in my trading.
What I mean is that when miners were acting well and in tandem with the metals, I would jump all over the 565 HUI level, as well as not selling anything. However, last week forced me to dump my positions because of the divergence, with my holdings exhibiting relative weakness except for 2 positions.
Today is showing this again, with silver up and most miners getting hit. I’d be happy with these prices, but only if miners can get in gear with the metals. Since I’d like to see this happen for a few days, I have not jumped in as yet.
I’ll be back in the miners no doubt, but it’ll also be for shorter hold times (like 1-2 weeks per trade) now that we’re later in the C-wave and I’m seeing sloppy divergences.
I’ll be sure to post when and what I buy, but for now am waiting for clarity.
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Gary/Others,
I know this is usually not how cycles work, but what do people expect as a catalyst to get some sellers in the PM market? I know that Gary always talks about overbought conditions and sentiment, but what do you think it will take to get some selling momentum in PMs this time. I assumed an agressive move in the dollar would encourage some selling, but it looks like investors are still holding strong and there are plenty of buyers stepping in at these levels. Is this a rotation from institutional to weaker retail hands, which is forming a base for panic selling if/when prices start to move lower?
gold silver troll,
Could you explain what a tail is?
Thank you.
Elaine
Elaine-
That means buyer are coming in strong on that dip.
http://www.fxwords.com/b/bullish-hammer-candlestick.html
This strength in the metals is quite something. Each dip is being bought. Gold is forming another micro ascending triangle which if it breaks out will take it to the 1518 range.
However the sentiment here can be described as nervously bearish for the very short term as it has been since last Monday.
The question still is – are we on day 24 or day 4 or a runaway move?
While, we can still have a 28 day cycle with a decline in the next 4 days, everyone here seems to have already sold and are antsy to buy back. So we are early as we expect to be, but with everyone wanting to buy back, I doubt we will get that multi day dramatic decline. 36 seems way too far from here.
Were you guys expecting S&P to downgrade the United States today? I sure wasn’t and I’m a hard core PM guy who reads and listens to everything. Now think about how the market is going to digest this news…Go long USD or bonds? Long stocks? Where’s the money gonna go?
Hint-one is yellow, one is white.
If the miners close near the highs of the day and form long tails today, its very bullish. However, I doubt they will go up in front of a decline in metals.
Either this is just a head fake in the miners, or they are indicating metals will continue to go up.
Best strategy is hold a bunch and keep some cash for the dip.
Jayhawk,
The rotation into metals today makes sense to me. What surprises me is the strength in the dollar.
I was thinking that we’d get the dollar bounce this week, and that would be the “catalyst” for the smart money to take profits. That’s why I’m wondering if people jumping on board now are the weaker hands which will be dumping at the first sign of a move down.
I agree with Gary’s early point that the likely top will come when everyone can’t stand the pain of being out, so I’m wondering if this is the final panic into the market. Judging by some of the comments on the board today, it seems like even the “informed” group here is being tempted to jump back in.
The FED could have been ready for this announcement ahead of time and they could be the ones buying dollars bending the scenes to prevent a panic sell off.
I think that the dollar strength today is more a function of euro weakness, so we’re currently the tallest….um, “little person” in the room. I should have clarified and stated that I’m surprised by the corresponding dollar and PM strength together. I guess that I was hopeful that the dollar bounce would be the catalyst for the anticipated correction in the metals. I guess a little more patience is warranted to see how this thing plays out over the next week or so.
I am seeing a lot of bear flags on the miners that have broken down today; SIL, SLW, GDXJ, AG, GDX.
I would imagine more downward pressure to come this week.
James
Usually these moves like we see with SLV this “porpoise nose” pattern is smart money exiting. I hedged further today.
james r,
I see a break down from a bear flag in GDXJ, but no bear flag in GDX.
Jayhawk,
To your earlier comment, courtesy of ZH:
The Reason For Geithner’s Weekend Media Whirlwind Tour: White House Learned About S&P Downgrade On Friday
And for the most unsurprising news of the day, Reuters reports that the White House has admitted it knew about the S&P rating action on Friday. Which means that all the key bond buyers (or sellers are the case may be, Pimco), knew at roughly the same time what the key market catalyst on Monday would be (we can’t wait to get a declassified glimpse of Larry Meyer’s phone log over the weekend one day in the future). Which also means that today’s action was a strawman in which the big boys merely waited for an opportunity to buy bonds are lower prices, which the ongoing European collapse merely facilitated.
Bob” What’s a “porpoise nose” chart pattern?
Fransico:
Are you saying the system is corrupt? Unpossible.
>The FED could have been ready for this announcement ahead of time and they could be the ones buying dollars bending the scenes to prevent a panic sell off.
The white house admitted of knowing about the downgrade on friday. Which means the fed and all the ‘boys’ in NY knew it as well.
They were ready and slammed down everything afterward (as well as Moody’s coming out and saying they thought everything was fine and the US was is good fiscal shape.)
Same manipulation games.
(You can track the stories on zerohedge if you want.)
You guys wanna see a hammer formation? Check out ABX.
Well,
Hanging man on AGQ…
Huge Silver Volume day. Second highest this year anyway.
http://screencast.com/t/Rb4LaUgr
DG, it is when you get a first hour spike on a position and then it rolls over lower, tracing out a porpoise nose. Typically signals weakness in coming days.
Jayhawk,
essentially a credit downgrade means that our nation is (in the eyes of S&Ps) one step closer to default. a nation defaulting on it’s debt is one of the most deflationary events that can happen. it is a massive collapse in the supply of money and credit, and we know that fewer dollars chasing the same amount of goods = lower prices and thus the market buying dollars on a day like today make sense. simple as supply falls, demand rises.
however, when you have the fed trying to fight this cycle by infusing the banks with cash, you first get all this debt washed away by default, followed by hyperinflation almost over night.
this currently is the path we are on, which why metals in the long run are the smartest choice. however dollar waves of dollar strength does play nicely into my theory.
Too funny CMT.
If you look at Pimpco’s holdings prior to Fed announcements, they have perfectly frontrun both QE1 (bought MBS) and QE2 (bought 2-10yr. treasuries). They did so with considerable leverage to, which Pimco usually doesn’t do. It’s too bad that they have 45 days to file their SEC documents, or you’d be able know exactly what the Fed was planning to do in advance.
The buying is relentless.
Can you imagine the panic selling with a 3$ drop?
After that, you have to wonder how many will have cold feet to jump back in and how many more will pour cash in because they’re convinced it will climb forever.
BLH,
If it is the smart money trying to exit, they have an overhang in the 1496-1498 range. Thats the top of the ascending triangle I mentioned earlier. It continues toward its apex with 5 attempts and an ongoing march for a sixth attempt. With so many attempts, its likely to overcome that resistance and go above 1500 toward 1518.
If it does break out, I am not sure its smart money thats selling here. They make come in later though. Also no GLD on SoS list, SLV is #6 with 9.8M and 6.7M block trades.
AGQ way up on the BB
1) This is week # 5- highest probability for a cycle top.
2) Also April 26th (next Tuesday) is Metals Options Expiration. Furthermore, my understanding is that it may till Thursday of next week for options to clear out (per James Turk mentioning during last month’s expiration).
So we have quite a while for volatility to calm down…top may not be this week necessarily
beep
YLD, you may be right, but I have a lot of profitable options that I am protecting / taking profit on. The last daily cycle low ripped the premiums from the options, and with us so late in the cycle on a low volume week, my suspicion is smart money is selling today to enjoy their Seders and Easter breaks.
High volume today, as well.
AGQ charts and action are meaningless. Its merely a follower to SLV. You need to look at SLV charts and action even if you are trading AGQ.
I am starting to think about these two possibilities:
1) We have a runaway move in gold and silver, or
2) The daily cycle low already came and went, and it occurred on April 12.
If #2 is in play, then we are only on day 5 of the new cycle.
The reason I came up with those possibilities is that today would have been a perfect day to begin the move down into the daily cycle low. Strong dollar rally and we’re very late in the cycle.
Because it has not happened–instead gold and silver look like they will close on their highs–that leads me to believe it’s not going to happen.
In that case, BLH, I agree with your action. I don’t like the drops in the premiums either and got out of all options over the past three weeks. I am now scaling in with futures only.
Bob: Thanks. I’d have thought a close at the highs would invalidate the reversal from the first hour spike.
Re gold: Interesting. Another decent up day tomorrow and I will probably get a sell on gold. The only other one I have gotten this year was on 4/8—the day of the recent high before that pretty stiff two day drop. (the previous one was at the top in November) This would also fit with gold poking its nose about 1500. Maybe today’s recovery will suck in the last of the “it’s never going down again” crowd. Waiting…waiting…
PimaCanyon,
It is possible……
I just rolled over the 50% ytd return mark… thanks Gary!
Jayhawk,
Thank you for the link.
There’s one other possibility:
Next week is Last Notice Day for gold and silver futures (April 27). Seems like every month around this day gold and silver get hammered. So maybe the take down will happen early next week.
But the behavior today would suggest that whatever move down we get next week (if any), it won’t be much.
pima,
I agree that its a higher probability (60%?) that a runaway move or a new cycle is underway and have been saying it the past 3 days. However, as I posted earlier today, we still have 4 days in which to have a decline. It may not be a large decline, but the daily cycle low can still happen this week. I leave it up to cycle specialists to call it when they see it.
I know we have seen day after day after day of gains on gold & silver but my gut tells me that it will go down. Unlike my gut, which needs a few situps and some cycling to retreat.
what about the possible-portfolio-change Gary?
These hammers are most amateurish. Infact closes in the green only reinforces the selling on strength that my tape reading is confirming. Even a gap up tomorrow would be a great point to exit longs.
So we are just about to the point where Gary said he might sell some … Do we have the indicator he was looking for? I don’t know enough about the charts to see for myself.
Elaine,
A “tail” refers to the way a candle on a candlestick chart looks on a day like today. If you look at today’s candle or gold, silver, or some of the miners, you’ll see the body of the candle near the top and it’s small. Below the body is a long wick or “tail”.
(Not sure where the “tail” terminology came from but it’s widely used. They are candlestick, so the part outside the body–above and below–should be called wicks. But few people call them that.)
Gotta: No. We needed to close down for Gary to sell a little more and we aren’t going to.
Gotta,
I doubt very much Gary will be selling. We don’t have a reversal candle on the daily.
I don’t have live charts – so anyone, please, indicate if we do in fact have that reading Gary indicated!
Thanks
All: I am away again for a couple of days, but I will try to post if/when I get that sell in gold.
DG,
We will miss you!
Please keep us posted, I like to follow your trades.
Pima,
Your much more experienced at this than am I, but isn’t this the type of action that you would be expecting before a “scary” correction. If we need to have overbought conditions and extreme bullish sentiment, then I would think that we’d need this final “it’s not going down” sentiment. Judging by the comments on this board, people were far too complacent and willing to wait last week, while now people are getting concerned that it’s running away without us. My gut says that once everyone here concludes that we have a runaway market, well that’s about the time it will roll over.
Oh, never mind – I just read the last posts. Goodnight from England lads and lasses
J
ahain,
SLV is on the SoS list today, but not a huge number and the number in the block trades column is less than half of the total.
What’s missing from the SoS list is GLD and miners.
Can someone please elaborate what the reliability of reversal candle may be & how Gary’s play: selling 10 pcnt more AGQ and replacing those with DITM calls ( in what?) would juice his returns? This must be overly tricky / risky/ complicated or all of those, for newbies…..? Would same logic hold: lighten up on AGQ and buy back more after dip? THANK$
Vonda,
I did my small “sacrificial” AGQ purchase a minute ago. Now we can maybe awake to a healthy gap down…heh heh.
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Francisco,
Makes sense. Maybe next week will let enough time pass to get everyone on board the not-gonna-get-a-correction bus and then we tank, just in time for Last Notice Day.
Silver back near all time highs, but no breakout for Gold from the ascending triangle…we have to wait to see the result after regular hours. Very low volumes compared to the first third of the trading session though.
Matrix, my guess is Gary has discovered as I did that a big AGQ position takes a lot of capital and you can invest just as heavily with calls for a lot less money in SLV or maybe another instrument.
Matrix,
Gary is unloading AGQ because;
1) He’s made a ton of profit on it and
2) The volatility and spread as we get closer to the C-Wave burst will be quite high.
It is my understanding that he will purchase SLV calls.
John,
Some brokers give you live data if you have an account with them. Think or Swim does. I use TOS and I’m very happy with their charting package.
Matrix,
The ideal would be to sell AGQ and then buy SLV calls with silver at a lower price than where it was when you sold AGQ.
For the same money that you spend on 100 shares of AGQ, you can buy 30 DITM SLV calls! Talk about leverage!!
I would be surprised if Gary goes anywhere near that kind of leverage. But with his small reduction in his AGQ position, he might take those funds and lever it 10 to 1 in SLV. AGQ is 2 to 1 over SLV, so having a small part of his AGQ funds working at 10 to 1 (or some number greater than 2 to 1) will give him a little more leverage without having to increase his margin.
Pima,
I’m just playing devils advocate here, and concede that your two scenarios are very possible…even probable. I’m just hopeful that we aren’t seeing the final run.
.
Thanks Catbird,
I’ve been waiting patiently, the last few days for you to do this…
WB
PimaC
thanks, i dont follow those WSJ numbers, but i appreciate the angle. Could be one to watch in the future.
I guess that the market is playing with us…Once we will stop looking for a correction it will hit us….
nope – didn’t buy SLW. I wanted it to close flat/green
ahain,
What indicators do you use that tell you distribution in GLD and SLV is taking place?
I keep trying to figure out price levels that would freak out weak hands. Since gold is the driver of the whole PM sector, this chart by Dan Norcini is appropos:
http://4.bp.blogspot.com/-kTZwYT7EQwE/Tax3U2P_qCI/AAAAAAAAAWY/5g8x3MBwL3Q/s1600/snapshot-636.png
Seems to me if gold dipped down below $1480 it would run a lot of stops. It wouldn’t bounce off 1480, of course, it would probably get to $1474 or something, just to really make people nervous.
Then we could see it rocket to $1500 in the overnight, and the final leg of the C wave would be underway. Skeptics would think “oh, well, it broke $1500, a nice round number, so that’s the top.” Or maybe “oh, it finally broke $1500, it needs to take a breather for a few weeks.” But it would just go vertical from there, leaving them to chase.
Just one narrative.
Thank you, Catbird!
I tried to do my part by following Jayhawk into miners — 20% total — but just couldn’t bring myself to sidle up next to AGQ at highs of the day.
(I did dream of descending elevators last night. Seemed only to hold for a few hours, though. Perhaps I can work toward skydiving tonight?)
Hilson Indicator update. (My PM buddy who flips out near bottoms and starts sending me irate emails. The strongest I’ve seen this indicator is when he is ready to sell all his metals as well. I’ll keep you abreast.) 🙂
Just got these 2 emails from him-
1. selling half of SIL at 30
have had enough with “stocks”
totally f-ing rigged…….
2. it’s so unbelievably obvious that the pig bankers are shorting
the mining etfs and not the individual stocks!!
SIL down more than SLW and SVM
GETTIN OUT ASAP!!!!
Jayhawk,
You enjoy spending time with this guy?
He’s a business partner, I’ve never met him live, but actually a good guy. Just a bit emotional, East Coast high strung type!
Anyone know how to get a long term futures chart in IB that strings the expiring contracts? So, for example, a two year chart for GC or SI
Jayhawk,
LOL!! That is amazing, dude.
Jayhawk,
Thats funny. Time to buy SIL, I guess. And hey, you did buy miners today.
Added just a handful of SLW, thought about GDX but in the end I was playing a video game and let it slide.
Que sera sera, down day tomorrow I will buy, up day, I got other stuff.
If this is a runaway move then we’ve only got a few days to a couple weeks before the D-wave hits IMO. I will be looking for entry points for shorts within a week if we keep storming higher like this, with a top somewhere just under 50.
Whoa, Dan. I do not see a runaway move here, not yet anyway. Maybe we should wait to see if the correction can work its magic first; I believe the talk of a runaway move right now makes a correction more likely.
Runaway move with the miners lagging like this? Anyone here remember ’08?
Kmisak,
If we keep going up at the right we have been for another week u can forget about a “correction”, it will lead to a full blown crash. We are nearing all time records for the POS relative to 200mva. A few more up days and everyone will be flooding into silver chasing it IMO.
If we start a runaway move it certainly isn’t going to end in a week or two. Those things go on and on and on until every short is bankrupt.
The other consideration is this isn’t going to top until the three year cycle in the dollar bottoms.
If the dollar just started another cycle it shouldn’t bottom till probably early June.
How many times must I tell people never short a bull market? And how many people have to get destroyed before we all learn this lesson?
Well, Dan, I hope you are wrong, only because I would love to see a correction before the finale. 🙂 I have some dry powder that I am itchy to use, but not so itchy that I’ll buy with Gary still anticipating a cycle low.
Hey, Gary! Having just cycled through another Canadian winter (in Toronto, tho’, where it’s not SO cold), I am wondering whether you are stocking up on really good socks for the ‘Horn. Personally, all I want to see right now(other than a silver price correction) are spring flowers and warm sun!
Kmisak,
I hope so too but think its just getting absurd. The buying is relentless.
Gary,
If the dollar and gold continue higher, how long would you wait to realize that we’ve entered a ranaway move?
Relentless absurd buying is not an excuse to do something crazy like sell short.
Michael,
It won’t take long. One or two more days of dollar strength that is ignored by gold will do the trick.
And that’s where correction will begin 🙂
I guess that we should see some selling on Thursday as the markets are closed for 4 days in Europe and people could be worried about a strong intervention by the ECB
Gary, how does a new cycle in the dollar result in a low in June? Are you expecting two cycles?
can someone take their mortgage out and put it on some silver, silver wheaton, and some other precious metals. smash these shorts.
we all need a lift here.
silver is already in runaway move from 41.3, gold is about to follow suit it did when it cracked 1488
lets see if this can hold, we had some intense buying today only covered up by the USD rise (headwind)
In tonight’s report.
Gary,
Some time last week, you said that if Gold reaches 1500+ without a correction, you would exit all positions. Are you still in the mood?
Eamonn: If I remember you bought some ZSL last week. I have made more errors than I can count, but I try (try) to learn from each one. If I remember, you shorted silver because it was “up a lot.” This is a terrible reason to short something. Shorting something that is “acting better than it should” or because “a correction is due” is one of the very best ways to lose money. It has been many, many years since I have done that, but the stench of it is, fortunately, still in my nose. I do not go so far as Gary’s “never short a bull market” (I do it often), but I need a damn good reason to, and definitely not just a trendline, overbought, or some such things. It’s not that it can’t work (anything can), but that the risk/reward is awful. Good luck!
Isn’t that how runaway moves get started? People saying it is crazy and shorting away, just to get repeatedly crushed until they are broke.
Off topic somewhat.
Fukushima has reactor vessels which have cracked, and the fuel has melted.
This is not a 9 month clean up program. That’s just another lie.
This is unharnessed uncontrolled fuel laying around probably in pieces in an open area.
Maybe cementing the entire place will hold it as it melts into the ground into the groundwater, through the core, to pop up in say New York, right?
Or some other bizarre outcome. This is the greatest disaster since Chernobyl, and unique in its own way.
What will the impact be on the yen and the dollar and the PM’s?
Watch anxiety go UP. The outrageous fact is this cracked vessel was obvious weeks ago via a fly over and the glow of the exposed rod pile. What we’re hearing is a major lie.
tell everyone you know to keep buying these metals because your dollar isn’t safe and you’re getting the silent tax (inflation) scare them into buying these metals.
gov’t going to find ways to pay for this debt, either through inflation or by taxing its citizens.
warfare doesn’t bring in the revenue like the old days
Gary,
If this in fact a run-away move and you believe it will last into early June with silver already stretched almost 1.7X above its 200DMVA today, how much farther do you believe it will stretch?
Keeping in mind the record is 1.7X set in 2006.
Thanks Gary, looking forward to it!
Brian – that’s exactly how the runaways get started.
the market is emotional.
don’t you love the people so stubborn in their views they will to no end put their own financial security at risk by putting these bets on the table.
or ones who find the little bits of information to help justify their own position but ignore the other.
the best traders are neutral. don’t marry these metals either, but for certain you don’t want to go against a bull. it may get tired, but if you poke it with your shorts it’s going to wake up and kick you in the face.
It will stretch till the three year dollar cycle bottoms.
I’m not nearly as sophisticated as many investors here, and I am trying to learn as much as possible here, so I have a question for anyone who has an opinion.
Those people who last week reduced positions that were NOT leveraged, did they make a mistake or is the jury still out?
I am following Old Turkey. I am still 100% invested – no leverage.
Gary,
Due to the inability of PM’s to go down, especially today as the dollar rose strongly, has made me wonder whether a runaway move has started. What would have to happen to raise the probability that we are indeed in a runaway move?
I also wonder whether the April 12 low could have been the daily cycle low and was just not very deep and also early. How likely do you think this possibility is?
rob
you are on the right track and even if we had a pullback, old turkey can survive all the wiggles and scary stuff
your going to outperform all traders… well 99.9 percent
Rob L., TWT.
Old Turkey is clearly the only way to go.
I got lucky selling a few miners and am now buying back in. Got cute with my AGQ position and now I need to re enter on a dip which will be well above where I sold. End of day, stupid to leave positions until the cycle ends.
in tonights report
Rob L,
Only time will tell whether folks who lightened up recently made a mistake, but it’s starting to look like that’s what happened.
You can never go wrong holding old turkey thru a daily cycle low unless you are too heavily invested for your own comfort and they daily low causes you to make an emotional decision to sell (usually near the bottom).
Rob, I did not reduce any positions, leveraged or otherwise. For me, when I have played that game in the past, I always got burned. Primarily because I have a full time job that prevents me from timing entries and exits optimally.
Some of the folks here that are good traders and have systems can successfully trade in and out. I can’t, so I stay with the program. Daily cycles, even violent ones are noise.
My 2 cents… With Greece and co, the Euro is dangerous…with Ben, the USD is dangerous…remains Chf and Yen and Gold….
Thanks for your responses, guys.
I could see the gold/silver discount the dollar strength at first then finally (ie violently) succumb to it as the $ continues to rally. The bullish complacency in PM’s seems a bit high to me which is disconcerting as well.
On the flip side in a runaway move anything can happen.
The University of Texas Investment Management Co., the US’s second largest college endowment fund, bought a billion dollars worth of physical gold on Friday .The fact that a major university would put that kind of money into physical gold at these price levels ought to be a wake up call to the investment world. Obviously they believe the price of gold is going MUCH higher from present levels.You would think this news gold would really take off but gold was down this morning before the downgrade by S&P came out-of course there is no manipulation in the markets ,is there ?
One thing to note in the final stages of a C wave, is that sentiment, MDAs, and charts simply become irrelevant.
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Gary,
Given the massive divergences exhibited by the majority of the mining complex, would it be safe to say that IF we get confirmation that we’re experiencing a runaway move into the conclusion of the C-wave, that the miners should then respond? Ergo, if one was waiting for another daily cycle low to redeploy leverage and we get some sort of confirmation that a runaway move is in progress, would it not be safe to deploy this leverage into SLW calls or the like, as the miners would eventually start to outperform?
Rob L: My two cents. You absolutely cannot tell whether a trade was a mistake by whether it worked or not. Time will not tell. If I offered you a 5 to 1 bet on the flip of a coin and you lost, was taking the bet a “mistake” on your part? This is a game of expectancy. Selling and having something go higher is not a mistake. It may have been. Or you can buy it back higher for a small missed opportunity. Or it may go higher this time but drop in nine other similar situations. Or…Would that it were that easy to tell. Most traders are emotional. Trading emotionally—selling when scared and buying when confident— is surely a mistake. Emotional traders will always lose to Old Turkey (and to any other approach). Gary is not as OT as one might think in that he sells for intermediate declines. In January he sold and soon bought back higher. Was it a mistake or the right play that didn’t work? If I buy back higher it will be the first time my sidestepping a move I expected has underperformed Gary (in percentage gain not absolute return on account because he is much heavier than I am). It happens. If it failed 4 times out of six over a couple of years I’d decide I was doing something with low odds of success. I believe over time my approach will outperform. We’ll see over the next five years (If you flip 1,000 coins and keep losing something is wrong.) For myself, thus far, my selling early has cost me nothing because AGQ is up but the miners i sold are all down a lot. As I said, my two cents…
Robert,
UT is obviously buying close to the top. They are going to get stuck with that huge position as the D-wave begins. Just because they are big doesn’t mean they are smart.
Actually what they did recently is absolutely stupid. They should have been buying in January. Just shows you that their investment team has no idea what they are doing. They are just jumping on the band wagon and jumping on late.
When they freak out and sell during the D-wave it will just exacerbate the decline. Of course the conspiracy theorists will call it manipulation even though I will have warned you it is coming months in advance. Just like I warned months in advance we would see this final run despite all the conspiracy nonsense floating around.
I still have no idea how anyone can even remotely entertain the idea of manipulation when the metals get into a run like this. It just shouldn’t be possible if the Fed has an unlimited amount of money to throw at the short side of the market.
Regarding whether selling was a mistake for those of us who are not leveraged. I think DG did an excellent job of answering this question, but I want to add a couple points.
1) Most of my sales were in miners, and so far, they have traded ower than my sale prices.
2) I think my exposure to the miners is appropriate for now. If we look to be in a runaway move I will add exposure to the metals.. I will add to miners if they begin to outperform, which i would ocnsider to be a strong tell regarding the status of the bull. In other words, if silver is up 2% and SIL and GDXJ are up 3.5% that would seem much healthier to me than the tape of the past several days.
It will also be interesting to see what happens when Gold breaches 1500. And most interesting will be the relationship of the dollar and the metals.
f
Robert,
I’m not sure why so many people are fixated on UT. Fact is they simply took possession of a large amount of gold that they probably bought in the futures market some time ago. The reason for taking delivery seems obvious to me.
Everybody seems to want to play this like they just pulled out the checkbook Friday and bought. These managers are a little more savvy than that.
Gary: It is hard for me to picture a runaway move with the miners acting so completely crappy. Oh well. Anything is possible. We’ll know soon.
Those of you reading the blog without subscribing are trying to save $100 and risk blowing what may be one of the the most profitable metals move of your life. Ain’t worth it.
DG,
I agree. When I look at a long term chart every daily cycle is pretty clearly visible. Apr. 12th is not clearly visible as a cycle low.
I’m very hesitant to call that a cycle bottom unless gold clearly ignores a dollar rally. One day is too early to say whether the dollar rally has begun or whether this was just a one day blip triggered by the down grade.
Rob,
I was not leveraged but I was 100% in. I sold off all my miners and only sold the same amount of AGQ/HZU as Gary. Unfortunately I didn’t get to sell my miners near the top but I still wanted to get out because I didn’t like how it was diverging from the metals. I also did not go all in when Gary called the IT bottom so for me to have lightened up was purely risk management for me. If this does turn out to be a runaway move (doesn’t feel right miners not participating) great I’m still in. If we finally do get the daily cycle I’ll add on Gary’s call.
IMO if IBM can beat and no negative guidance is given I can see the scenario of money moving out of metals and back into stocks. Given todays big down day and the market closing off it’s lows, the market is begging for something to rally behind and I think a IBM beat can provide that.
Great report this evening, Gary. It answers a lot of questions.
Thank you!
Wav, Hasn’t good news been getting sold lately?
DG,
I see your point re “mistakes” in trading. The main problem with thinking that way is that if the market does what you weren’t expecting when you opened or closed a trade, seeing it as a mistake is damaging to a trader’s own emotional and mental make-up.
You said something about the UNG trade a few weeks ago that emphasized that point. Once you close the trade, you move on. If UNG goes up after you sold, that shouldn’t be viewed as a mistake. You considered all the evidence and acted accordingly, and in a similar situation would do the same thing again.
However, if you are new to the trading world and you’re following Gary and you don’t have an established track record of trading successfully, then dumping a large chunk of your AGQ position in anticipation of a daily cycle low was probably a mistake. Why? Because that action was very likely an emotional decision, and was certainly a decision that was not based on any kind of personal track record. The best way a new trader/investor can avoid making mistakes in the future is to just follow what Gary does, with the caveat of knowing what your risk tolerance is and knowing how much you can be invested without freaking out during periods of drawdown. So when Gary is fully invested or fully leveraged, for you that might mean 50 percent invested or 70 percent.
Gary,
Is it safe to assume that any dollar bounce will not surpass the March 29th high of 76.43 (make a higher high)? If this should occur, does this change your forecast for the last leg in the C-wave?
One of John Murphy’s best anecdotes from his Intermarket Analysis book is about market tops. I don’t have it with me, so it is a paraphrase.
After an economic expansion has run it’s course. Equities top first, followed later by commodities.
Seems the equity top in Feb, is playing into this analogy rather well. You can look at previous tops for confirmation, but usually oil is the end run, because high oil price always leads into a recession.
It shouldn’t but there are always exceptions to every rule. The Jan daily cycle in the dollar surpassed the Dec. cycle high but was still a left translated and failed cycle that started the plunge into the three year cycle low..
BTW the high came on Apr. 1st at 76.61.
Thanks. I was just looking at closing prices and didn’t see that high.
Pima: Yes, I agree with most of what you have said. It’s an ever shifting line between just relying on Gary and learning to do it on your own. I believe that line needs to move towards self-reliance over time. My post was more about people being careful to analyze rather than to assume “if it worked it was a good trade, and if it didn’t it wasn’t.”
I am not so concerned about damaging the trader’s emotional and mental make-up, though that is is important to avoid as you have said. My concern was “learning” the wrong trading rules from a bad trade that worked or a good trade that lost. Learning bad habits is very expensive. Interesting and good post, though. Thanks.
DG and Foosby,
Great points.
Foosby,
I really believe that since the stocks are lagging we will indeed see the correction we are anticipating here.
Re: The Univ. of Texas buying/taking delivery of gold: “…managers of the endowment, known as UTIMCO, sought board approval to convert its gold investments into bullion this year.”
http://www.gold-prices.biz/texas-schools-hoarding-1-billion-in-bullion-at-hsbc/#more-2371
The key word was “Convert.”
And they are still going to get stuck with a billion dollars worth of gold at a C-wave top.
Gary, The cycle from late July last year to late October which was 61ish days had a mid point decline in September that looks very similar to what we just experienced.
The question is would you label 09/18 as a daily cycle low, or consider that whole run 1 daily cycle?
Gary, my wife has our credit card in our earthquake kit, and for the life of me I can’t find it now – will check the car – will sign up when I find it.
JayHawk & other chartists, is any one worried about the neg div in SLW’s daily & weekly chart? Looks poised to hit the 200d EMA, as in Jan. W/my limited understanding of cycles, this may also coincide w/Gary’s cycle stuff on the dollar and gold.
Brian,
That was a full daily cycle low. It did break the cycle trend line.
What the hell is a “runaway move”? First I heard of it. Is this something that happens when cycles don’t work? Will we know what’s going on within a week or so?
Thanks!
PSLV- up almost 6% today and sits at a staggering ~23% premium on huge volumes today.
I would have expected smart money to be exiting PSLV during this week showing smaller premiums.
http://www.sprottphysicalsilvertrust.com/NetAssetValue.aspx
Eamonn: It means something that is going up no matter what. Cycles and other methods simply stop working once a true mania takes hold. Rare, but it does happen. If even a rallying dollar can’t cause a gold correction it may be what we are dealing with. This week is telling.
Brian,
I think it has b/c it was news that was expected. JPM had a great quarter but sold off during the day, I think, b/c earnings were helped by its credit card business (debt). Another leader, Google, costs didn’t look good due to their large hiring spree. TXN missed tonight. IBM, I think, can provide the market the little bit of positive news it needs.
DG, thank you. Also thank you for your earlier comment RE shorting. I got out of it pretty quick. I’m sitting on my hands now waiting to see which was the wind will blow. Its hard waiting. I get itchy fingers. But I will wait. I just have to learn that lesson.
DG,
Thanks for explaining the runaway move … how does a ” … the correction size ….” apply to that scenario ?
DG,
I remember you saying you sold out of all your miners and thinking strictly going all in AGQ when you add. Today, you stated that you were close to getting a buy signal for SLW with your system. I was wondering if we do get the correction that we’re expecting, will you just be deploying in AGQ and SLW or strictly AGQ? I’m kind of in the same boat and deviated from Gary’s portfolio (risk management for me) so I’m trying to decide if I want to deploy everything in AGQ/HZU or go with some miners.
Ryan: I tend to follow my buys when they show up as they are very high percentage trades. My plan would be to buy SLW, hopefully watch it pop, and then put in a mental break-even stop in case the miners break down again. I would buy all the AGQ I planned anyway and SLW would be extra.
Moondoggie: Not sure what you are asking.
DG,
Thanks hopefully you’ll be able to post if you get that SLW buy signal!
BILL: I don’t see a negative divergence in SLW daily (and I use RSI(5), which is very sensitive to those things.) There is a bit of a negative divergence in SLW weekly, but I think that is being taken care of right now (the drop since last Monday).
I don’t think there’s any chance that SLW will hit its 200MA or 200 EMA this time around. It should bottom in this correction somewhere in the 38.80 – 37.50 range. It looks like it will essentially put in almost a double bottom with the last daily cycle low.
Beksachi,
PSLV had a wild day indeed – up 6.5% off the previous close, while AGQ only went up 1.8% yet tracks 2x silver’s performance. So investors Monday figured PSLV was worth 3x silver’s performance?
I figure it must be the scare of a potential downgrade in the rating on US debt that had more people running to one of the solid funds (ie, more unequivocaly physical backed).
I like PSLV, but at a 23% premium to NAV, I’m thinking it’s a pretty good spot for me to take profits and cash out ahead of maybe a daily cycle low. I might then put that into something like AGQ or if I want to stay with a solid fund, then I’ll switch over to CEF, which is half silver and only trades at a 3% premium.
A big overhang to me with PSLV and its 23% NAV is that with all the interest in it and the astronomical premium, Sprott is bound to do another share issuance, which will promptly deflate the premium some. Sister fund PHYS just did an offering and these kinds of closed-end funds usually do one or two offerings a year. PSLV’s first one came back in November.
Moondoggie,
–IF– we are in a runaway move (we can’t say for sure just yet but should know something within a few days or before the week is out), then corrections in gold will likely be limited to $30 or less.
The last daily cycle low was a 60 point correction. If we do get another daily cycle low, we should see at least a 60 point drop in gold.
A question for the board….
A runaway move sounds great, but if the miners don’t confirm the move how is this possible? I know for one I am confused. I still think a nasty correction is on its way. I won’t be buying back my leverage into this; it just doesn’t pass the smell test. Happy to be wrong, but I would think runaway moves would have the miners leaping up not neutral or dragging down sharply.
Of course I am not saying to not hold a core position and sell everything…not at all. Just expectations are a way of getting one in trouble if leverage turns against them.
Hmm so say the dollar goes up, gold and silver go up, but the miners go down….what the heck does that mean?
No expectations at the moment. Just waiting to see what happens.
I can say that I will not be buying any call options unless we get a recognizable daily cycle correction.
Jabalong,
Agreed- PSLV’s premium is ridiculously high and I was wondering who the hell is buying it right now.
I also plan to re-deploy a bunch into CEF (lower volatility) and some miners ETFs as well as some silver stocks once this long awaited cycle low occurs.
Here’s a question, why would the US dollar rally on a day when the news was dominated by a potential downgrade in the credit rating on US debt? I’d have thought that would be bad for a dollar as a sign of lower confidence in the creditworthiness of the US.
Is this just a knee-jerk flight to safety in the dollar even though the bad news is dollar-specific? Seems nonsensical just writing that last sentence yet we often seem to live in a nonsensical world. 😛
the miners are not lagging
the metal is catching up
everyone forgets the insane miner gains in the last months
relax…the miners will get there
don’t overtrade grasshoppers
**FRAUD: Federal Reserve Is Selling Put Options On Treasury Bonds To Drive Down Yields*****
http://www.youtube.com/watch?v=ZnZnkaq8Nf8&feature=player_embedded
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Gary,
Which do you think will perform better in the final daily cycle SLW or AGQ?
Sera,
I think the guy at ChartWorks subscribes to Gary, since he is repeating everything Gary has said!
PC
I was confused by that reference in the nightly report … trying to understand the difference between a runaway move correction and a daily cycle low correction.
I guess I’ll keep both concepts in mind while we wait for a clear signal.
thanks for your insight !
Moondoggie: “… trying to understand the difference between a runaway move correction and a daily cycle low correction.”
As far as I remember, Gary doesn’t use the term “runaway move correction”, but just “runaway move”. It’s not a correction, but a very strong parabolic up move that finishes with climax top.
Yes makutaku, you’re absolutely right.Hoping not to be in a runway move indeed. 🙁
Makutaku said, “As far as I remember, Gary doesn’t use the term “runaway move correction”, but just “runaway move”. It’s not a correction, but a very strong parabolic up move that finishes with climax top.”
Could you please clarify the term “correction” for me? Is a correction always down? (It’s confusing to this newbie sub.)
TIA
Hi,
Does anyone see a rising wedge pattern on the hourly silver chart ?
Thks for your thoughts about this pattern.
“DG said…
Eamonn: It means something that is going up no matter what. Cycles and other methods simply stop working once a true mania takes hold. Rare, but it does happen. If even a rallying dollar can’t cause a gold correction it may be what we are dealing with. This week is telling.”
But Beksachi jsut reported Sprot’s Silver fund is carrying a 23% premium.
Hello. The gift arrived. You’ve just not wanted to open the package.
Gold target, once the package is opened (which means gold gets above 1551), is 2100.
At 2100, game’s over for all but the totally reckless as that will be above 6X.
I’ll be gone at 2000+ At $2000, gold will be then nearly fully inflation adjusted, unless while getting there, we need to buy and use wheelbarrows to carry around the fiat.
Diana: “Could you please clarify the term “correction” for me? Is a correction always down?”
To the best of my knowledge a correction can happen in either direction. It’s when the price, after being stretched (up or down) snaps back, or partially back – towards the mean, like a rubber band.
Because we are in a bull market in PM, correction will normally mean down in this forum.
Neo; Gold is the driver so I am not sure I would watch silver, but if one wants to look for patterns you can see a rising wedge on the GC 1 hour. I just don’t think patterns at this point are the most valuable tool.
Certainly not intraday patterns.
The only reason patterns even work is that they sometimes represent the thinking of the market. One needs a big pool of traders and investors for that to have any hope of being representative.
Intraday one is just dealing with a very small subset of day traders and short term market timers. That’s not a big enough pool of traders to make patterns representative of anything.
Good Evening All,
I haven’t read all the posts so I apologise in advance if this has already been posted.
Silver chart shows the two repeating ranges up of the measured move from January 28 low is almost complete. The target is $44.02. My data shows the last candle tagged $43.56, awfully close. it was also a hanging man candle which tend to occur near turns. A 50% retrace of the last leg would take us back to ~39, a 50% retrace of the entire move is back to ~35, heaven forbid.
Looks like we have the potential to put in Gary’s cycle low very soon. I hope you have your insurance paid up 🙂
I can post a chart if you wish.
Cheers
Darren
good morning Gary,
any thoughts about the dollar? It seems that the large reaction of yesterday didn’t have any follow thru
Sophia,
The market hasn’t even opened yet. I’ll let you know by Thursday whether or not the dollar cycle has bottomed.
thanks Gary! have a great day! Here, gorgeous weather, the Alps are shining under the sun!
Hi Silverman,
would you mind sending us your charts? I don’t have any tools here.
Thanks!
silverhound, i anxiously just wait for that!!I do hop you’re right!39 will be perfect … 😉
I think Silver is talking about a possible T1 pattern in silver
Thanks Gary…
I am also going to see on Stockcharts if I can get some free charts and start to learn properly how to use them
http://www.freestockcharts.com
requires Microsoft Silverlight
or monest.net/charts
Hi Sophia
This is what I’ve been watching on the silver chart. No guarantee’s but the timing seems right.
silver ranges
Cheers
Darren
Sophia,
You can’t do too much with the free service. If you do decide to buy a membership put me down as a reference. [email protected]
I’ll be happy to add a free month or two to my charting subscription 🙂
Yep
Gary’s all over it.
Jammer, Mr Miyagi & Pima Canyon:
Thank you for your replies and for sharing that!
What would an example of DITM SLV calls be?
What if we don’t get any correction and we just go up and then down, down …..into the summer doldrums?
How much merit do you give to the seasonality statistics? There was a high correlation for much of last year.
Thanks Guys!
Thanks Silverhound!
Great chart indeed…
And Gary, definitely, if I go for it , I will tell them that you refered me… Small token for your great help along those recent months!
Matrix,
Seasonality is more like a gentle breeze. It’s not going to override the dollar collapse which is what is driving this C-wave.
Heck we saw gold make new highs last summer. That never happens … but it did!
from jan low agq and pslv both up 150% ..
agq 116 to 300
pslv 12 to 20
approximate numbers
Silverhound,
Thanks for posting that chart. Definately puts a few options on the table.
yash, which is the difference between the two?thx
86d4life
No probs. The final target depends on how you draw the pattern and as you can see Gary’s target is a little higher. The main thing is it gives you a target zone to look for something to happen.
Cheers
Darren
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This from Ed Steer’s daily ..
(I do believe in the silver manipulation)
Here’s a paragraph I stole from silver analyst Ted Butler’s Weekly Review which he sent out to his subscribers on Saturday afternoon…”Against the backdrop of a surging silver price, the calls for a sharp sell-off continue unabated. As I previously reported, almost all those calling for a sharp correction seem to share a commonality, namely, a disbelief in the silver manipulation. I think this is a crucial observation. Let me stipulate first that there can be a correction in the price of silver regardless of whether it has been manipulated or not. But nothing can be more important to the future direction of silver prices than in understanding whether this market has been manipulated. To those who don’t believe silver has been manipulated in price, it’s hard to see how the price won’t collapse. Those who believe that silver has been manipulated [like me] know that the price will explode when the manipulation is terminated. That’s a clear line of demarcation.”
At Ease,
Good morning. I got a 404 on your link. What is the article about?
If the dollar stays weak today & tomorrow it opens up a completely different cycle expectation from what I went over in last night’s report.
I’ll go over it in tonight’s report.
Gary,
Can you just tell us i this is PM positive or negative for those of us planning on doing som trades today. Thank you.
Gary,
I meant the weakness in the dollar that you will go over in tonight’s report.
Thanks Gary,
Starting to feel like a cat on a hot tin roof.
Gary,
For clarity can you confirm that we are waiting for a dollar low which we expect to mark the top for gold? At that point you expect a pullback before the final blow off?
TIA!
Trying again…
S&P helps Gold and Silver
http://money.cnn.com/2011/04/18/markets/thebuzz/
nice work being done with the TSI Trader
He discusses that the miners are on the verge of a breakout
http://thetsitrader.blogspot.com/
Slumdog: (re your 2:03 post) The “gift” is a great idea—it’s just not what we were talking about. Eamonn’s question was “what’s a runaway move” not “”has silver rallied a lot.” You probably gave a great answer to some other question.
DG,
wouldn’t the gift be what you find at the end of a “runaway move”.
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Ike: Thanks. Interesting TSI post. Everyone here should read it.
At Ease. Yes, but he said: “Hello. It’s here.” And it both hasn’t been established that it is, and we are not at the end of it., He writes so poetically that I rarely understand what he is saying so maybe I have misunderstood him.
already done this morning…. 🙂
SLW’s late day rally yesterday and flat to higher opening today has killed the possible buy signal for now. We;’d need another very sharp down day or two to get it. Too bad.
I say that every john’s posts on TSI trader are interesting and useful.
DG, I agree, had to read it twice to get the idea behind the post.
DG,
Thanks for the slw heads up.
DG,
I see some miners that I like going green this morning:
EXK, AG, FVITF
Any buying potential there?
DG,
I do not trade options, but what would you say about adding a little leverage to SLW by purchasing their warrants. They are in the money.
All,
For those that are good at options, wouldn’t a “straddle” trade work pretty well right here?
Isn’t this the trade where you make money on both sides, you just need a strong enough jump or correction?
If so, what would be the profit potential and best action to look at?
An SLV June 42 call is $2.62.
An SLV June 42 put is $2.55.
Total contract cost is $5.17.
How do I calculate the “in the money” zone?
What if silver goes below $40 or above $47?
At those points, how much money can I make?
If a runaway move means that gold won’t drop more than $30 off the high pivot until late June, in my opinion it is very unlikely.
Didn’t the SPY runaway move that was looking to be the case early in 2011 not pan out?
What is cloudy for me are what are all the possibilities in play right now and what key things we look for to determine which are taking shape.
Hot Rod,
If you’re going to play option spreads and other complex strategies, you need options software that will answer the questions you’re asking.
TOS is a great broker for options trading. Their platform was designed primarily for option spreads and other complex strategies.
OptionsXpress is another one.
Silverhound-
Nice chart. Although your target of 50% might be a bit extreme.
Check out how the first part of that move only retraced to the 23.6 level where it found support.
One the /SI chart, that would mean a move to 41.15 for the 23.6, right where the 10EMA is rising. The 38.2 retacement would get us to the 20 EMA right around 39.69 if my chart is correct. Given the timing band issues for gold to give us a swing low/swing high, I’m favoring the 10 at this point.
Guys, I have very narrow parameters that get me into a trade. Options, warrants, individual miners, etc. I have no particular opinion about (at least not one that’s worth much). My specialties are particular trading setups and SPX directional calls at certain junctures. For the rest and decent trader’s opinion is as good as mine. I post a trade when I have high confidence in something
Hot Rod,
I like optionsXpress. I got an account there mostly to learn as they let you do that for free endlessly. You can run all kinds of scenarios. Good for me as I learn from seeing and doing, and this way I don’t lose any money.
Kevin,
Thx. I have been using a free options express account but have not explored all those features yet.
I’ll see what I can dig up.
Hot Rod, I thought the interface was a little learning curvy, but if you click trade, then save something you might be interested in, you can hit the calculate button on the saved trade and then run all kinds of calls, spreads, etc. Maybe take an hour and fiddle with it and you’ll appreciate the power of the software I think.
SHZ getting hammered this morning. That is a super-volatile little stock.
Hot Rod,
Here are the breakeven points
An SLV June 42 call is $2.62.
An SLV June 42 put is $2.55.
Total contract cost is $5.17.
The call break even is strike price + total cost. = 47.17
The put break even is strike – total cost = $36.83
In theory, the price of silver must go above $47.17 or below
$36.83 for you to be in the money.
Please correct me if I am wrong.
G’day Jay
I don’t doubt you are correct. I wouldn’t expect it to go way back to 35 either (hence the “heaven forbid: :-)). I do think that 50% retrace of the 2nd range up at 39~40 is possible though. There is a nice little divette around 40 (dare I say EW subwave 4 correction) that may indicate support. That would set us up for EW 5 which as you know is the big one with commodities.
Anyway we need a correction first 🙂
Thanks for your comments.
Cheers
Darren
Good morning all
Had to work Mon and Wed this wk as a consultant, but here today and end of the wk.
kind of a fuzzy day..not much going on and no clear picture of direction as of yet. I like the charts for EXK and Ag ,consolidating above the 20sma (but will they break down to the 50sma, or up out of this consolidation (flag-triangle?) pattern?? Cant tell.
Not much to say at this point.
Still nothing to act on, IMO.
Gary, how likely would you consider for this dollar cycle to have topped in just 2 days?
KEVIN
A friend asked me about buying SHZ last week if it broke above $6.50 , and I drew this chart dated April 15, saying to wait — that it could actually go back to the original breakout , and at the bottom of a new trendline. This would be below $6 and maybe $5.50 area.
It is there now ,but volume is strong(ish). It may become a buy though, believe it or not 🙂
http://www.screencast.com/t/bxWTISASpO0
The good news is that Geithner has reassured us that there is no chance the US will lose the AAA rating. Phew……
If the dollar continues down I wouldn’t consider it a new cycle. I would assume it was just a one day spike.
Aaron
Interesting question there..
If it did it? What does it mean for precious metals? Will there be a correction even if the dollar falls?
If the dollar continues lower then I think we probably have our runaway move in progress.
Makes sense, this is afterall the three year cycle low, and things should be getting out of hand… sentiment is a non issue.
Dollar can keep heading down, while the PMs keep pushing higher leaving a lot of chasers behind.
Very few people expect this.
How do you apply a “30 point correction” to a runaway condition then, anybody?
I’ll buy SLW ounce it hits 39.00-39.50m in the next day or two.
Gary
Does that mean that the dollar will fall lower and not rally until the three-year low is in? 4-5 weeks from now.
Just some small intraday moves higher..
Man so hard to predict this..But it is possible..
Runaway moves is a persistent rally that grinds higher day after day with occasional corrections all of which fall within a standard magnitude and duration.
If the April 12th correction has set the standard then all corrections should fall in a range of about $25-$35 points (on gold) and not last more than a few days.
I would still expect the dollar to run it’s normal cycles. It’s just that a bounce would probably only drive a 30 point correction in gold.
Wish Gold had made it on to 1500.
Muchas gracias
I doubt this cycle will top before gold pushes through $1500.
agq down 1% pslv up 1%
FWIW I have support on the dollar at 75.25 (on the June contract).
Yash, I sold all my PSLV on the 8th because I thought it was looking a little unsustainable. By the 12th, I knew I was a genius. Now. D’OH!
Just checking in occasion. Thanks for updates DG,SB, and glad Alex is back. Appreciate you Gary always 🙂
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Gary,
Couldn’t yesterday’s action in the dollar simply be the result of emotional investors rushing to unwind their carry trades (buy back dollars) and not the start of the dollar bounce that we’ve been expecting. I’m not giving up hope yet that we’ll see a more substantial move in the dollar over the week or two.
BTW, the financial times reported that the Fed, at their April 27th meeting, will confirm that they will finish all $600 of QE2 as planned and that there will be no plans for any further easing (yet). I know that this is probably outside your timing for a correction, but it could be a day to watch.
Gary
If Gold pushes above $1500, will you reload or wait for a dip? Or does it all depend on what happens to the dollar?
Le Fou
Bought more AGQ. Silver doesn’t want to stop. I can’t stand waiting for a pullback. So now we can have that correction.
wav ridah,
I bought a smidgen at the close yesterday. This “correction” I was rewarded with today doesn’t look like much of a correction, does it? ; )
The June Dollar DXm1 couldn’t get thru its 20-day MA up about 75.78
DX been respecting it’s ‘weekly chart floor pivots’ as so many items do:
http://www.mypivots.com/dailynotes
Good Luck Way… I hope you are not getting sucked in before a correction…. time shall tell.
Wav
You never know..:-)
But yes you are chasing and there has been no correction. But Im not so sure anymore that we will se one..
Not a major one..Maybe we will stay at these level for a couple of days and then go higher..
Who knows..?
How much emotion was involved when you bought? 🙂
That was funny b/c I was waiting for someone to jump in, be that sacrificial lamb. Expect the unexpected I guess.
Patrik,
Not being fully invested has been driving me nuts. I still have about 10 percent sitting on the sideline waiting for a home. If I don’t see some kind of correction soon I may just pour the rest in by the end of next week.
Bought EXK, reversal on light volume. 🙂
Wav-ridah,
If you bought calls that are far and deep then even with a dip you’ll do fine.
It’s the OTM speculations that get snuffed.
So, if this is a runaway market (confirmed if gold resists dollar rally 1-2 days?) then *would* that actually *be* the C blow-off, *or* would the *last leg* of the C blow come *after* the anticipated dollar 3-yr low?
Wav Ridah,
Sacrificial Lamb..huh? hahaha…love that term 🙂
Inconclusive today as dollar is down a bit and PM’s are up a bit, so just normal. If we get another sharp up day or two in the dollar and gold is up anyway it might really be that it just isn’t going to dip.
Gone for a day or two. I might pop in if something fascinating happens, otherwise see you all Thursday. Take ’em down while I’m gone!
AEM has a nice reversal candle on the daily.
F.W.I.W.
I had sold 1/2 my Exk position and have been in and out of AG, so my purchase was a trade on a short term trade trigger that I got at $11.33, but it may go into my permanent EXK holdings.
DG
Im ove the same school of thought. I closed my aggressive short (tut tut shorting a bull etc), didnt get the shock trade i was expecting that would make some easy cash, so closed out and now on the sidelines.
AGQ printed $300 just now…
Maybe THAT’S the big round number the PMs have been waiting for so they can correct.
Gold within grasp of $1500 as well
Re SHZ: Careful with these Chinese companies. Lots of fraud over there. Here’s why SHZ is down:
9:31AM China Shen Zhou Mining receives a going concern qualification for the 2010 year (SHZ) 5.95 +0.06 : Co announced that its audited financial statements received a going concern qualification from Sherb, co’s independent registered public accounting firm. This announcement is required by NYSE Amex’s rules and does not represent any change or amendment to the Company’s financial statements or to its Form 10-K for the fiscal year ended December 31, 2010. Subsequent to the 2010 year end, on January 24, 2011, the Company announced the completion of a registered direct offering to several institutional investors for ~$20 mln of common stock. Institutional investors were issued ~2.8 mln common shares together with warrants to purchase up to 851,066 shares of common stock which, if fully exercised for cash, would provide an additional $7.2 mln in gross proceeds to the Company. China Shen Zhou believes working capital raised in January 2011 is sufficient to maintain operations throughout 2011. Further, the Company reported in an 8-K filing in April 2011 that it entered into an equity transfer agreement for its 60% equity ownership interest in Wulatehouqi Qingshan Nonferrous Metal Development for a price of RMB 8.5 mln. Upon completion, this equity transfer agreement will partially offset the Company’s debts owed to the purchaser, and reduce the Company’s liabilities.
Wav
Yes it is very hard to see the price in silver rise when you are not fully invested..
Was very close to buy some more today..
Got a lot of money off the market and its driving me nuts..:-)
But I will not get greedy and do something stupied in front of a correction..
The dollar is showing some weakness..
Would be nice to hear from TZ and see what he is expecting?
I feel you moneyman. If I had any less AGQ I would be holding ZSL. Silly inexperienced move trying to dance with bull. Lesson learned. But more opportunities to enter will present themselves as subsequent cycles unfold, right.
A smart man on this blog once said. If you like money, stay long PMs. I get it.
DG
I’m getting a buy signal on SHZ @ $ 5.03…thx! 🙂
“Gold within grasp of $1500 as well”
and bounced off it like a cat off a hot tin roof too. Looked like a piercing move trying to trigger some stops?
CNBC had a ticker headline go across the screen that said “Gold Hits $1500.” This was about 5 minutes ago.
15005 did print.
Lets see if this will start profit taking that can break 1490
Gold painted a high of 1500.50 and got back down very quickly to 1494.50. If it keeps falling and goes down below 1487, it may be what several here are waiting for.
Is it wrong to WANT a temporary downturn in prices??!??!!?
Perused some of the Yahoo boards–not my favourite thing to do–and all I see is “up Up and AWAY.”
So maybe “we” are still contrarian — no one seems to be expecting a dent in the action.
p.s. Dear Gold, beautiful, round Apollonic number that 1500. Now give it a rest, will you!!
The Yahoo! Finance forums are full of amateur. Go look at some tech stocks…
Gary, Are we looking to get in with a drop from $1500 gold?
As for SHZ
I was 1/2 joking with DG, because he posted news on SHZ..But I also do expect a decent bounce from this level.
I know some on here may follow me into a trade, so I apologize…I am in ‘trading mode’ and should have stated …that it might just be a quick trade, I’m sorry. I do think that its going to get a good bounce from these levels, but at this point, I cant tell if its a buy/hold or a quick trade.
I will re post as time goes on.
Please sell if we bounce even .20cents and you are comfortable with small gain.
MiyagiSan,
I was looking specifically for amateur, as dumb-money as I could get, thinking they would be the last and final to jump on, (or maybe the penultimate group, as they themselves seem to be waiting for “dumb money” to catch on, which would make Who last?).
Where, specifically, do you typically take a pulse when you seek it?
Vonda, thats an easy one!
CNBC
DeMark notes today from Kevin Depew at Minyanville:
S & P futures – DAILY – TD BUY setup on Bar 8 of 9. To perfect, low either today or tomorrow has to be below yesterday’s low of 1290.50 to perfect (reach full exhaustion). If recorded, expect a 1-4 day upside reaction – Thursday into Wednesday of next week
Gold has TD Sequential 13 Sell Signals across multiple time frames, both DAILY and WEEKLY, but no confirming bearish price flip so far, so gold keep on rising to $1500 and beyond!
In the article “Five Things You need to know: The Myth of the Fed’s Unprecedented Bond Purchases”, Point 2, Depew shows the NYMEX Gasoline futures contract – WEEKLY is recording a SELL signal this week, good for 12 weeks, MONTHLY will record a SELL Setup next month if it closes above 249.06, good from June-September. Notice how good a similar SELL setup identified the top in 2008. Good news for summer drivers!
That won’t be the only touch of 1500. The big boys will likely keep hitting it until they punch through and round up as many short stops as they can.
Morning Vicked Vonda
How goes the dig’s in that seedy roach infested hotel, deep in the heart of sin city…..
Vonda,
Yahoo! Finance is one place, the other is Kitco’s forums.
They are both pro-uptrend therefore the indication you get is not a true one but the sentiment is somewhat relevant.
More importantly, I try to spot the amount of new forum members at Kitco and here. The more that jump on, the more late money. They tend to make the worst decisions, bandwagon style.
This doesn’t apply as much here, there is a lot of technical information, not “To da moon!!” postings by the gross. I believe that whoever comes here and reads, asks and learns has passed the jumping in with both feet tied to a cement block stage.
COOLKEVS
AAAHHHHH , No Habla ESDEMARK , could you please just fill in the blanks
Gold should go _____ , For ___days
and ___weeks.
SPZ shouyld go _____ , for ___days and ___weeks.
🙂
* SPX (sorry)
CNBC has experts saying that 1500 gold is simply too expensive 🙂
Aaron, oh no! Cramer-land!! (Didn’t you hear, I’m already down on my luck . . . now I gotta listen to Jimmy?)
Morning SilverHound,
The red dress is wearing thin, that’s for sure. Cheap sin and cheap gin start to stink after about five minutes. So I hobbled my scrappy self over to the casino and plunked down a bet on miners–one table over from Catbird’s AGQ roulette. So much fun to buy then wish it DOWN!! I love how it f’s with (translated as “tempers” for those of you not on skid row) ego-psyche.
Yea, I figured we’d be doing the dance around 1500.
Thank you, Mr. MiyagiSan. I like that, noticing the new members . . .
so that was your lil ol porsche I saw double parked outside the big flashing lights 🙂
All that glitters is not always 1500 gold
Shadow Stats made this report free for non-subs. I’ve not it yet as it’s very long.
http://www.shadowstats.com/article/hyperinflation-special-report-2011.pdf
Shhh! Big DaddyCramer don’t know I was out with his car (or his wallet.)
And don’tcha know, “1,500 gold is simply too expensive.”
Alex, great response to coolkevs. Why someone persists in posting that gibberish, knowing that most people find it incomprehensible at best, and at worst really annoying, is beyond me.
This is the most nervous I have been in a long time. I’ve made an absolute killing the past few months and evey day all I see is green on my account but when I look at silver and how stretched it is relative to the 200dmva it makes me tremble. We’ve only been this stretched once before at 1.7x and silver ended up crashing almost 20% overnight. Not sure how many of you were around in 2006 but it wasn’t pretty.
Am holding my full position for now but putting my thoughts out there
haha you day trader guys are so itchy with the trigger finger
nice going gold hit 1500, it only run away move if it can sustain this for a couple of weeks.
i think it’s best to stay in the game unlevered with a play on the pure metal though because to time this market with all this volatility and other factors make it even more difficult.
i hope the market can start zooming though and the miners can start up. they are a risk on trade.
personally they look neutral at the moment.
c’mon HUI 620
coolkeys…
Does this say sell even thought it’s still going up beyond 1500?
“Gold has TD Sequential 13 Sell Signals across multiple time frames, both DAILY and WEEKLY, but no confirming bearish price flip so far, so gold keep on rising to $1500 and beyond!”
The lure of easy money is never “too expensive”. Be careful what you buy, there are more than just the dealers at the casino that will take your money……
Needed a good hearty read, Jayhawk, whilst waiting for Apollo and Artemis to ease off the accelerator for a bit. Although the essay– so much in line with what Gary and many of you have been advocating — makes me want to buy AND take delivery, just like Texas (with a few less trucks.)
I’ve never wanted to buy so bad. I got a little taste this morning of AGQ, now I’m wanting more. I think I’ll turn off my computer now. Have a great day everyone.
I hear you Dan.
Appreciated this, from Doc, last night:
“…sometimes it is necessary to step back and digest one’s success. By reducing exposure, one can purge from one’s mind whatever hints of greed or other malfeasant aspects of the ego that may be cropping up. The market view then clarifies, and further action can be taken with confidence.”
Gut feeling…I think I’ll sell AGQ I bought this AM. Bye now.
On the other hand, I appreciate coolkevs’s supplying us with that DeMark info. He’s just trying to help out people here, and, from what I’ve heard, DeMark is probably the most accurate PREDICTIVE indicator system in the world. (Whereas most other indicators are actually backward-looking.)
I used to follow Depew when I was a member of Minyanville. (VERY GOOD place, but dropped it because I had too many newsletters, etc.)
I agree that some interpretation would be nice, since I certainly don’t fully understand it either. If anybody is interested, a good book to study over a weekend or 2 is: “DeMark Indicators” by Jason Perl. I’ve got it sitting on my shelf, just haven’t had a chance to crack it yet.
I’m good, Silverhound. Pretty contented with my dusty, porch-dog life. Anything on top of that is just (organic, sustainable) gravy.
As an analogy, I was kinda thinking about the scene from the old film, The Jerk (und), the other day–at the end where the family used the wealth to build a bigger shack? I don’t have a whole lot of use for additional $$, just like the freedom it can buy and want to protect what is in the bank from scenarios such as the one in the report Jayhawk just shared when they play out.
In the past month when sentiment has been “Looks like I should sell”, the price has gone up shortly after. Conversely, when sentiment, like the past couple of days, has been “I should buy… should I buy? Yeah.. I should..”, the price has gone down.
Just my observations, I get the little voices and consequently I either buy or sell a small amount but hold most.
There’s only one person who’s right all the time and that’s my wife. I know because she told me.
You funny, Wav-Ridah. Gotta love the tension.
Hope you’re not reading this.
Hope you turned that ‘puter off.
The decision to buy or sell depends on your time frame.
I know most of you don’t stack physical silver, but I just bought 500 silver rounds at $44.78 each. Ouch!!
I know that I will probably be upside down for awhile if/when we get the “Big Dip” … and Gary probably thinks I’m an idiot.
But I am going to hold that silver for YEARS not weeks or months … and I’m totally confident that 10 years from now I will be glad I have it.
My point is that “old turkey” investors like me have a different price sensitivity than the short-term traders on this blog.
AT EASE: as I understand it, that DeMark gold info. that coolkevs supplied basically says: no sell signal yet on gold. Those DeMark “sell signals” on the daily and weekly charts are actually “potential” sell signals, that become real sell signals when you get that “bearish price flip” — which we haven’t gotten. (It involves price going down a certain amount in a certain time frame. I don’t fully understand it.)
Anyway, even with a daily cycle low in gold and silver (which I think is still coming up…they’ll probably bottom on options expiration day…which I believe is next Monday), I don’t think that “bearish price flip” will be triggered, and therefore we still won’t have a real sell signal on gold using DeMark.
USD about to break down again…
This comment has been removed by the author.
Thanks JHNewman, appreciate the explanation. Makes sense with what’s happening. More lingo to learn. 🙂
Can some of you “old timers” explain what was going on in 2006 that caused silver to go up so much?
I wasn’t paying attention back then, so I have no idea what was happening in the PM markets.
SHZ just pooped its pants 🙂
everyone seems to be just sitting around waiting for this correction which only has 2 days to go if it’s a normal cycle. meanwhile silver has moved $2+ from last tuesday. I’ve been in and out and going to load up come Thursday when weak hands unload for the long weekend.
THANKS, Rick4779. I printed out your info.
Rick, whats sad is that during this C wave we have had bigger percentages between the two… if this is supposed to be a blow off top, we still have room. Lots of it.
I cant believe I have NEVER seen this mentioned.
Check out XG!
VANCOUVER, BRITISH COLUMBIA–(Marketwire – 04/19/11) – Extorre Gold Mines Limited (TSX:XG – News)(AMEX:XG – News)(Frankfurt:E1R – News) (“Extorre” or the “Company”) is pleased to announce high grade to bonanza grade gold-silver results from the first 3 of 21 diamond drill holes completed to date on a discovery named Zoe at Cerro Moro, Santa Cruz Province, Argentina. Visual inspection of the core, without the benefit of assays, suggests that drilling has just entered the mineralized zone and that mineralization continues at depth.
Aaron
Good point, yes 12/3/2009 $GOLD was approx 25.6% above the 200DMA. So, yes, we still have room to move.
nitro, by the look of it, it seems that people are going to load up ahead of the long w/e!! 44$ already, 46$ by Thursday!
….AT EASE: you’re welcome.
Yeah, always more lingo! Why can’t it be easier to make truckloads of money?
Gold can’t seem to be able to budge. At this rate of sideways move, it’s liable to drop for a good chunk.
Well, gold and miners are both up today, which is a good sign. Looks like miners are breaking out of the descending trend line. Is correction over?
Agreed, Mr. Miyagi. With silver so strong, gold is the one to watch here for signs of a daily cycle top. And it’s momentum is falling. It looks like it’ll start to come down later today and tonight.
Rick, 12% above 200 DMA on $Gold.
1337 was 200 DMA for yesterday.
1496-1337=159
159/1337=12%
?
Alex, I posted about XG previously but no one was interested!
John’sMotivation
My face is bright red right now…I had plugged in 1650, which is where I thought GOLD was going to end up at the peak of the current C wave.
You are correct, we are only 12% above the 200DMA. My apologies to you and everyone else.
It is true that Gold is sticky…bought some this morning to see if it could break 1500 and I am still waiting while Silver is cruising to 44$
Brian
I must have been snoozing…I usually look them up, and that chart was drawing a nice cup/handle.
Oh…Actually, before March it had low very low volume ,like 20,000/daily, I wouldnt have liked it. looks really good now (not to buy here, just volume-wise).
Repost…
C wave peaks above the 200DMA($GOLD):
06/04/2002 330.30 14.0% above 200DMA
02/05/2003 388.90 20.4% above 200DMA
04/01/2004 433.00 12.1% above 200DMA
12/02/2004 456.87 12.3% above 200DMA
05/12/2006 730.40 40.1% above 200DMA
03/17/2008 1033.90 32.0% above 200DMA
Today 1496.00 12% above 200DMA
Rick
Actually Thats good news…even more room to run 🙂
Nice catch John with the good looking snowdog
Rick, Aaron…
I agree that it appears there is still lots of upside … if this is supposed to go parabolic…
I would think that those prior percentages would be exceeded.
Gary has mentioned before … “potentially 40-60%”
2006 was the credit cycle boom.
Money was flowing in all directions.
I don’t see this C-wave stretching that far above the 200dma.
James
Really shouln’t publish numbers here. Especially since, when they contradict was Gary is saying on the premium site, but now that …
http://www.hookedonphonics.com/hooked-on-math?C1=19
Just a little GS humor.
XG was spun out from XRA last year and recently received the US listing (XG.V in Canada) and now has great drill results. Great move recently……wish I had continued to add! Check out Orko Silver (OK.V). I brought it up a while back. Increasing volume on the weekly charts, with a potential close over $3.00 being very constructive.
Just an observation,
(but even I think I may be just grasping at straws here 🙂
When I look at 3 month charts of EXK and AG , they appear to look quite similar to the day before the slam down open on March 15th.
Both looked like bullish flag consolidations right above the 20sma…then the next day opened WAY below the 20sma and shook the bulls out.
It doesnt look so bad on the chart now, but EXK gapped down $1 , and AG gapped open down $2 , then the rally started.
Hi I’m new here! Can someone please explain to me why the silver miners are diverging from the silver PM. Isn’t the miner suppose to follow the trend of the silver PM.. is this a bullish sentiment for the miners.. as for the silver pm it seems like its forming a hammer reversal which can spark a bear?! I just bought SLW and SIL… I hope I made the right decision!
Funny, gold is back and forth in 2-5 cent amounts while silver is moving in 10-15 cent amounts.
Rick,
Thanks for the post. 40% above today’s 200 day sma (1341.30)is $1877. I like the way you think!
Gary,
Traditionally gold leads the PM market.
But for the past couple years, especially this year, silver has been leading the way and seems to have a mind of its own.
Do you think you’ll ever get to the point of tracking cycles in silver rather than gold, or maybe in addition to gold?
… again, it’s the $HUI that would presumably rise to 40-60% above 200 DMA.
?
Hey MrMiyagi,
Do you think that SLW has a chance to have a better % return than AGQ in the last daily cycle?
NIVEN: for some discussion on silver v. silver miners, go back a little into the older posts here:
http://www.traderdannorcini.blogspot.com/
As for buying SLW/SIL now: JUST MY OPINION, but it depends how long you plan to hold them and how much pain you can endure (having paper losses).
I think we’re seeing the daily cycle top in gold (and therefore, roughly silver) today. If so, then they’ll both go down for roughly 4-6 days. Then we’ll start the next daily cycle up. (Gary covers all this on his premium site.)
So, my GUESS is, those positions you bought today will be underwater very soon, and you won’t get back to breakeven for about 2 weeks. And then you’ll start to make money. I think it would be better to sell them today, and buy them Monday – Wednesday of next week. But that’s just my opinion.
And I apologize to Gary and anyone else if I shouldn’t have given this opinion here. I’m fairly new here and don’t know what Gary’s policy is.
Jayhawk,
Thanks for the link re hyperinflation. Yes, it’s very long. I stopped reading where he goes into stories about what it was like in Weimar Germany and Zimbabwe, partly because those comparisons to the US today are essentially apples to oranges. Will we get there? Maybe. But the first thing that would have to happen would be for the US to start issuing its debt in some currency other than the US dollar, as was the debt for both Germany and Zimbabwe.
Niven
we have all kind of had the same question. Most here are fairly heavily invested , some 100%, some even leveraged…We have been expecting a pullback in the metals , and the miners to join the run.
For now, Silver is just crazy, and driving us crazy too 🙂
Rob L,
You’re asking me a loaded question!
I don’t know, AGQ has led higher since the beginning of March. SLW has been lagging (in my opinion).
I’m staying with SLW, personal choice.
Minors catching a bid here EOD
Niven,
it is my personal take on it, so take it with a grain of salt, but the leverage in the mining shares has been priced in. When your cost is $4 per oz. and the price of silver goes from $10 to $16, your profit margin doubles. When your cost is $5 and the price goes from $35 to $40 your profit margins are not affected all that much. And then you have company specific risk (a la HL and, recently, CDE) which is why I have dumped all of my miners in February and am 100% AGQ. Easy to manage and beats the pants off any miner (including AG lately!)
Gotta, cycle analysis anin’t easy. Works better on larger markets. Sort of like EW. Kind of anyways. Have you heard Gary’s interviews are contrary investor’s cafe yet? Actually hearing him is a great advance from having everything reduced to writing.
http://www.contraryinvestorscafe.com/gary-savage-radio/
@jhnewman,
What let you think this ?
jhnewmann,
Welcome. Your scenario is certainly a probable one. I am wondering about another scenario that gives us a correction early next week, just in time for LND for the futures.
But both of these scenarios leave out the alternate possibility: that we do not get a significant correction, that a runaway move has begun. That’s what the buying today is about I believe.
174+57=231
212+57=269
248+57=305
already made 305. hope it stops here as i sold it 303!
Ysh, what the target pull-back and next top in AGQ ? Thks
Rob L,
I also don’t like the volatility of AGQ’s leverage, I know it’s linked to SLV but still….
LOL@ MrMiyagi.
Thanks for your response. I was just curious as SLW could have a heck of a run if the miners finally participate – maybe surpassing AGQ.
Yes, that is possible, probable?
SLW has put in 3-4$ gains on many occasions.
thanks for the advice guys. I subscribed about 2 weeks ago and have been itching to get into a silver position but with all the talk about gold getting into a correction I was afraid to get in. I think gary mentioned earlier that if the dollar continues to fall we may be getting into the runaway phase. I’m just putting 50% into silver for now… I guess if theres a correction I can put more ammo in! Would anyone advise on buying put options to hedge against a fall in the silver price?
SLW did 70% the final month and a half of last Fall’s intermediate cycle, but AGQ still beat it.
SLW has not been acting well, but once it breaks through this congestion, it could run nicely.
niven,
That’s good like that, I’m not fully invested either but if it goes up C-style, I’ll still make a ton of money.
There’s another “kevin” on here now, so I guess I’ll be “KAL.” Don’t forget, I’m the new, ignorant guy. Haha.
Jayhawk,
That is my thinking. I have much of my portfolio tied up in HZU/AGQ. I was thinking of re balancing and putting it in SLW before the next daily cycle.
Junior silver mining favorites AG & EXK flat lining on a day when silver hit’s 44. SLW and SIL look to be backtesting the bear flags.
Long and holding.
I anticipate you guys will start capitulating and buying soon.
I do not believe this rally will stop as many are expecting.
I have stops, of course, if necessary to the downside.
Gold stuck in 1496 limbo.
Does anyone knows what “Doc” thinks about this daily cycle ?
SLW looks to have a crawl pattern developing along the 50 MA.
Maybe that is foreshadowing a selloff…
Well at that rythme, we will be at 45$ on Silver by tomorrow!!
Tz,
What is a good DITM strike price on SLV to look at buying here if we go on the predicate there is more room to run?
Is $20 too low?
Gary,
You’ve mentioned before that you felt once silver reached $45 that the price would be sucked up to $50 pretty quick. We’re pretty close to that at 44.16. I can’t recall if “sucked up” were your words but the basis had more to do with the previous $50 high than the price of gold. Could you give us your thoughts on that in the post tonight?
Thanks
Gary – why is XAU and GDX lagging so badly?
Hot Rod,
I would say July or October 39 or 40 is deep enough.
Sophia: Nothing incredibly sophisticated. As I mentioned above, I think the key in looking for a cycle top is watching gold (or, in my case GLD, since I don’t have intraday charts for gold). Silver is so strong, that gold will crack first, and then silver will follow.
And you usually watch the “shorter” charts (5 min., 10 min.) for the first signs of weakness, which will then spread to the “longer” charts (15 min., 30 min., 60 min.)
On the GLD 10 min. chart, MACD (which hasn’t been negative since Tuesday last week), looks like it’s poised to go negative (as it did in the big move down Monday last week).
Also, on the GLD daily chart, there’s a bit of a negative divergence [using RSI(5)], which is bearish.
Finally, I just think Gary’s cycle work is very accurate, and that we’ll have a decline into Monday to Wednesday of next week.
PIMACANYON: thanks for the welcome. It’s always interesting to “game” these various scenarios. We’ll see how it plays out.
TZ
How do you decide where to place your stops on your newer positions?
TZ
How do you decide where to place your stops on your newer positions?
Looks like Brian and Mark are the go to guys for what stocks to buy at the bottom of the D wave. Nice spotting guy’s.
Thanks jhnewman for taking the time to answer my question. All the best!
“Also, on the GLD daily chart, there’s a bit of a negative divergence [using RSI(5)], which is bearish.” If you relied on negative divergences, you would have missed a lot of silver’s phenomenal gains. jmho.
Mr miyagi,
That doesn’t seem very “deep.” 🙂
What is advantage of going with a $40 over a $20 that has less time premium?
I have been on the road and just got online. For those interested, I just got a sell on TLT at the close. I bought some TBT. Have a break-even stop in on EUO at this point having gotten a nice pop in it. Just missed that buy on SLW I posted yesterday. Darn! Oh well.
Stops should be placed, generally, where you think:
1) if the security goes below “this” point then something I believe in is wrong.
2) if the security goes below “this” point and I sell, I can handle the loss and recover.
Other than that I just look for areas near recent lows on a daily chart – since a ‘bull’ market is defined as higher highs and higher lows.
DG,
Thanks for the post. Was in TBT before, made a little, but you think rates are going up? What is your holding timeframe for TBT?
And, miners really diverged, time to get back in SLW, and others?
Neo,
Doc thinks that we are still due for a daily cycle decline and that it is likely to be sharp, but brief, when it occurs.
One might note that the consolidation pattern formed by gold during March was $60 deep. With the breakout level at $1440, the extension of that pattern is $1500. Gold is also 25 days into the cycle, so if we’re going to see a break lower into a daily low, now would seem to be the perfect time.
TZ,
I’m with you on this run … I really think this train ‘aint stopping any time soon.
Good general advice on stops.
I’d sure like to see some specific examples from your portfolio, if you don’t mind sharing.
For example, do you own AGQ? If so, what is your current stop on AGQ?
I realize that we all have to make our own decisions and do our own research, but I find it very helpful to see specific examples from the experienced traders here so that we can all watch an learn.
Thank you TZ. Appreciate your response.
Hot Rod,
Read this. Also read the related 4 articles at the bottom. If you print them out via Word copy&paste, it’s around 20 double-sided pages with size 11 font.
After that, you can use an online Options Delta Calculator (Google them) to figure out the Delta.
Yes, there is such a thing as waaay too DITM!
Thanks for your answer “Docs”. I know you didnt have to give your opinion since i am not your sub, so many thanks again.
Hot Rod what is your reasoning for going all the way down to a strike of $20 when you get a delta of 1.0 at the $31 strike? You can pay a lot less per contract to get the dollar for dollar move in SLV
Gary might be right again! Couple of weeks ago, he mentionned the fact that at one point during earning seasons, people will start to buy the stock market and dump commodities…we might be at the turning point….
Does anyone know what the trendline break is for gold? If there is a quick break of that it would be good to know the level as of today and how much it goes up each day.
Motherfffffffff!!!!!!
Everytime I use the “a” HTML function, it boots out my comment.
Hot Rod,
http://www.investorplace.com/714/what-is-options-delta/
Read the above and the 4 articles at the bottom.
Then use Google to get an Options Delta Calculator, just plug in price, strike and days left.
There is such a thing as Way too DITM options!
William,
Thanks. I did see that after my post.
I liked Mr M’s suggestion to go higher around $40. You pay more premium but can leveredge higher, right?
Thanks
Sorry firgot to say tat Gary said tat would trigger a short term correction on precious metals, but we needed to buy it…
TBT the other bull market? 50 DMA is 5.5% above 200 DMA. Currently, kissing the 200 DMA due to BB crash.
I’d expect SPY/DIA/QQQ a good deal higher tomorrow based on today’s earnings (IBM, INTC, YHOO). Also, AAPL, NFLX, PCLN and a bunch of others had afternoon rises.
Seems like the PMs and miners are headed for that pre-C decline after all, if all continues into tomorrow.
I’m not always right, my wife keps reminding me of that.
GottaHaveIt,
I’m almost mostly in gold and silver futures. I don’t play options.
AGQ is just a derrivative of silver. You should analyze silver directly for technical analysis. The world is playing “silver” not playing “something that moves 2x to silver” so technical analysis on AGQ is mostly useless despite all the people here who are trying to do it.
TZ,
I can’t invest in futures (all my investing money is in IRA accounts) and I don’t know enough about options yet to feel comfortable trading them. Therfore, AGQ is the “next best thing” for tracking the price of silver. If you figure that the price of silver is going higher, as I do, AGQ is a good way to play it because you avoid company-specific risks of the miners and get better returns than SLV.
Of course, if/when POS goes down …
That’s another story. 😉
Mr M,
What are you seeing that makes you say we may be headed for a pre-C decline?
Hot Rod,
Earnings pushing stocks up. Check out afterhours prices on the stocks I mentioned earlier.
Also, I posted a link about options for you higher up.
@Jayhawk
I just glanced at that Shadow Stats report and it’s written by someone who doesn’t understand the US monetary system. Right away it starts in on the Federal Reserve monetizing debt.
I wish just once these guys would ask themselves to what purpose the Federal Reserve is monetizing debt for a country that can print all the money it pleases. Unbelievable.
Wes, were you an econ major?
Wes,
I think you and I are mostly on the same page when it comes to understanding our monetary system. But the Fed buying Treasuries–isn’t that monetizing the debt? Printing dollars in exchange for T-bills or notes or bonds?
I too began to wonder about the author when I got to the part where he devotes several pages to describing what it was like in Weimar Germany and in Zimbabwe.
@kevin
you posted here, I just been following. I will change. Proper etiquette 🙂
In Brazil w/o consistent internet so usually just download and read……..for now
Wow, how things play out in a bull market! A few days ago when Silver was at 40, the expectation was that it would go down to 36 in the daily cycle low. That would be severe decline of 10%. Now, if that 10% decline happens, we are talking about just under 40 as the low! Mr. Super Bull rewards old turkey handsomely. That is, as long as you listen to Gary and get out for the D-wave.
>I can’t invest in futures (all my investing money is in IRA accounts)
You haven’t done your homework.
Why Gold Stocks are Struggling Despite Record Gold Price
By: Jordan Roy-Byrne | Mon, Apr 18, 2011
http://preview.tinyurl.com/3kbfpnh
PC,
This is lifted from an article at Pragmatic Capitalism :
“The issuance of bonds continues to this day due to Congressional mandate. In reality, our bond market funds nothing and serves only as a reserve drain which helps the Fed maintain its overnight target interest rate. It has nothing to do with funding the government. When the US government wants to spend money they do not call China and ask for a line of credit. They do not count tax receipts. And they most certainly do not call the Fed to ensure that we have any money left. No, the truth is that the USA never really has nor doesn’t have any money. So the entire implication that the Fed is helping to fund US government expenditures is entirely inaccurate and anyone who implies as much is still working under the now defunct gold standard model and clearly doesn’t understand the workings of the modern monetary system.”
When you see money being dropped from helicopters, they will be being flown by Congress, not the Federal Reserve.
Le Fou, excellent article. I was thinking the same about rising oil causing miners to loose some profit margin, but the idea about CAD was new to me, and a good one.
Le Fou, do you believe that cycles can accurately predict the turning points in the dollar and gold, the way the EW also claims it can (but can’t)?
Open question to forum:
I have about 7K in additional dry powder that I am looking to deploy here on the next correction. I am looking into DITM SLV Call Options. I am curious to know if it is more prudent to purchase a single contract and control only 100 shares of SLV (which I could afford to buy at expiration) or to purchase multiple contracts (six or seven) and control 600 or 700 shares, and sell the option before expiration. I would like to control more shares and sell the option at the height of the C Wave… Any thoughts would be much appreciated. Thanks, all 🙂
Aaron,
I’m not an economist, but I am a big believer in the fact that you don’t have to know how to play third base to tell when the third baseman has made an error.
blakemancillas,
The whole point of options is leverage. 1 call is not going to do a heck of a lot for your bottom line. Comissions are going to eat part of this too.
SLV calls are 5-8$, I buy 10-15 at a time.
i remain cautious here, i think we could see some action on late Friday/Monday, id certainly be looking for a pullback around here (proprietary seasonal model)
Wes the reason I asked was simply due to your “unbelievable” commment at the end of your post.
I obviously dont know who you are or what your credentials are, however there are PhDs from MIT who disagree with you, and I was wondering why you made it seem like the idea was so ludicrous.
I’ve read Roche’s argument, and its simply his opinion. It doesnt make Mishkin’s assertion that we are indeed monetizing any less credible.
These are and will remain opinions until the end game. The edge on either argument will depend on who and what one is willing to believe or side with.
Bill,
I don’t think of cycles as a predictive enterprise. I think of it as an alert to be on the lookout for certain moves. Gary combines cycles with other tools like sentiment, trends and technical indicators to take advantage of price movements. Gary is a realist, and he’s always ready to change his position when the market moves against him or in a direction he didn’t expect. If you watch long enough, you’ll see that he sometimes changes his analysis of the trend retroactively because the price has done something he didn’t expect. He says he has only one goal, and that is to make money. And he seems very good at doing that. His advice comes from the mistakes he’s made over the years and the lessons they’ve taught him. I’m just grateful that he’s willing to pass them along to me. Between Gary and theDoc, you can learn a lot about using cycles to improve your own ability to make money in the market.
Best,
Le Fou
Oh flip…Did I really just open THAT can of worms again! Oh please don’t let Timandjennine come back now.
Wes-Did you watch that video I posted on how the FED is driving down rates by selling put options?
http://www.youtube.com/watch?v=ZnZnkaq8Nf8&feature=player_embedded
Blakemancillas,
Mr M has it right, more leverage and lower cost overall by buying more than one.
I buy in even amounts, so that if I need to, I can sell half when it reaches 100% profit getting my original investment back, and let the rest ride on someone else’s dime.
Ahain, Arn’t the markets closed Fri and Mon? US markets closed Friday and Europe market is closed Fri and Monday?
Why did I sell PSLV? That one behaves like its AGQ on steroids sometimes.
SD Jack, I like that idea on options. Will use it!
Aaron,
I’m representative of the common man, and try not to engage in heavy discussion with PhD types.
The Fed is buying the debt but is not funding the spending. Usually when people use “monetizing” it’s to imply that they are, and that’s certainly the implication in the article I referenced.
But, if the PhD’s disagree with what I just stated, they’re wrong.
SD Jack: On the road so checking in when i can. Re TBT: No time frame as I let the market tell me. I believe TLT has hit at least a short term peak. I bought TBT at 37.16. Once it clears 38 I will put in a mental stop at 37.16 and tide it until it does something “wrong.” As for miners, one good day does not a trend make. The tape action has been very weird if this rally is to continue. I have a good chunk of AGQ but lots of dry powder. If at a certain point it becomes clear to me the dip is off the table I have no problem buying. Price never matters to me; just “is it going ujp or down from right now?”
At Ease
Youre right, need to recalibrate the dates. US is open Monday (EU closed), so maybe close Thursday would be a good time to exit longs for the short term.
DG,
Great perspective on those two points.
I will take a small position in TBT tomorrow, but a little hesitant due to the chart looking awful.
Miners; Gotcha, same position with dry powder & will follow your lead on jumping in with both feet, if I am able to keep up with you on this very busy blog.
Wes, for the sake of the blog, and Jayhawk, Ill refrain from getting into that discussion.
…at ease,
That is an option strategy used by professional option traders.
This peon uses it too.
Wes,
So that brings up two things:
1) I thought that the Federal Government was restricted by law to paying out (to their creditors and employees) only the amount of money that they take in in taxes. The amount over and above their tax revenues must be funded by selling debt. Is this incorrect? If so, then the Federal Government can just pay employees and creditors in dollars and the deficit problem goes away, right?
2) If the Fed is buying treasuries, the result is that they are exchanging debt for money. So the net result is that they are putting new money in circulation. Why is that not monetizing the debt? What else would you call it?
wes
if you had a PHD you would know how to spin it better =)
Thanks La Fou.
I’ll think on it. That better nails for me what Gary’s services are about.
Problem for me is I’ve been following a different guru for the past 4 yrs, and made $0 in the process. I’m still pissed, and have since embarked on a self exploratory thing that has netted out to a simple trading model that I understand and trust because it works. I’m very reluctant to piss all that away to follow a new guru. Kinda like quitting the Christian church to join the Buddhist temple, all the while wondering if God or Buddha exist. It’s a hoop I have to mentally cross before I pay someone for something that I don’t yet trust. It has nothing to do w/Gary or you all.
Probably for me I need to see the dollar bounce, and gold correct, for a few days – that will confirm to me that Gary’s stuff is real – or that he changes his mind if gold doesn’t correct – meaning that he’s pragmatic and real as you say.
In the meanwhile I’ll keep reading and thinking, and following my own system.
I’m really impressed w/Poly though – making all that dough – and then getting out 100% to cash. I’d add her name to your short list of guru’s.
Thanks again.
Wes,
Is it because they have the intention to sell the Treasuries down the road? So they are just acting like any other buyer (and seller) of Treasuries, right? So in that sense they are not monetizing the debt, right?
But what if they buy trillions and never sell them, then we’d have to agree that the debt has been monetized, right? But that is not their plan, so we have to just assume that they are a buyer of Treasuries just like you or I could buy them, and that some time in the future you and I would sell them, and so will the Fed.
Do I have that right?
Aaron,
I don’t see how you could disagree.
The US government is never constrained in it’s ability to spend. It could be constrained by Congress, but nevermind that.
So, there is absolutely no reason I can think of, and I’ll go so far as to say there is no reason you or the PhDs can think of for the Fed to fund the government.
It’s not like they’re about to run out of ink or electrons.
bill this daily is tricky, but gary got us in at 1330 ish. daily cycles are for adding leverage. the cycles do come very regular.
if you are just starting, you are starting close to the top.
gary has great tools we all are learning . dont give up yet
Bill,
I understand your reluctance to follow another market analyst. I too had the same problem with Gary, was very cautious at first, and even after I subscribed I did not go all in following his calls. But he has been right on and I’ve made money. Made some on the late summer/fall rally (didn’t go all in on that one) and made a bunch more since the January low.
Now’s the time to do this. The C wave may have only a few weeks left. Once it’s done, we’re on the sidelines (or maybe a small short on a sector in the stocks market) for a couple of months or longer. Then if we get lucky there will be an A wave that we can catch for profit, but after that it will be slim pickin’s for a year or longer. So now’s the time.
Just buy a one month subscription, read the last couple of weeks of daily reports, read the terminology and other docs to get up to speed on cycles, spend a month letting Gary call the shots, and then see what you think. Believe me, the amount I’ve spent to subscribe to Gary’s service is pennies compared to what he’s helped me make in the PM markets.
No more dithering. Just do it!
The reason central banks exist is to fund (pay for) their government’s deficits.
Bill,
I understand you frustration. I followed some gurus, made my own decisions and came up short. Started following Gary, had to start rebalancing here and there as each oportunity presented itself and I have to tell you; things are looking good! I took profits on a little agq last week,shouldn`t have but that was the move at the time. Core is intact and powder to burn to finish C.
Why not do a month with Gary and try a few small positions and then let the results speak with little risk? No need to go whole hog when a little old gold turkey will do.
Thanks Pima and Michelle.
One more rant before I buy, because I finally found our credit card 😉
Just like there are a couple of EW guru’s, and they don’t agree at ALL, there are a couple of cycles guru’s, and they also don’t agree at all.
I think that once Gary wrote that he respected and learned a lot from a good ‘ol Alabama guy w/initials TW. I love listening to TW every week, but he was flat out DEAD WRONG on cycles 2 yrs back on gold – missed it completely. Just like my other guru. JG, his sidekick, nailed it, because he’s a chartist, and just followed the trend.
Another cycles guy is in Florida, initials LE. He says he’s a cycles guy, and he also COMPLETELY missed the last 2 months of gold/silver’s rise. He still warrants caution.
These guys are nice, and failures.
It’s the success part of Gary’s work and you all that encourages me to come up to the trough one more time and drink.
I’m a math/physics guy so the only way I know how to do this is to split my brain in 2, and I’ll put $100K on Gary, and $100K on my brain, and see how they net out over the next month.
Again, I did discover a killer system that works and works and works. It’s simple, and that’s why I could think of it. As I wrote here once, Einstein said to keep things as simple as possible, but not too simple.
I hope for Gary’s system to work so I can join you all and switch from being a terrible trader to a killer (follower) trader. I’ll sign up now.
Pima,
Aren’t we supposed to see a correction here soon, buy on the dip, and then profit from a parabolic move to the top of the C Wave?
You say “a few weeks left.” Does that mean like 6 weeks, or a couple weeks (as in 2)?
pima,
Congress and Congress alone determines how much the US spends. If Congress says “spend more than you take in”, and they do all the time, the US Treasury spends it.
That’s called deficit spending.
None of this, other than the bookkeeping, depends on the government collecting anything or borrowing anything. They just print it.
The quaint notion of selling bonds is left over from the gold system, and Congress keeps renewing it because they don’t understand the US monetary system either. But it doesn’t raise money for the government, anymore. It’s used to determine interest rates, now.
Now you are technically correct that buying treasury bonds is called monetizing, but the problem is that many people believe that that also funds the government. That part just isn’t true anymore and hasn’t been for more than 30 years (since Nixon).
Now, what the Fed is actually doing
under QE2 is exchanging short term debt for long term debt. They certainly aren’t printing dollars. Only the Treasury can do that.
Hope this helps.
Slumdog, to your earlier post about Fukushima. I’ve read the same thing – that Japan is lying, and that the US is telling the truth.
I have 2 facts for ya: 1) everyone lies, and 2) GE (US company) built the plant.
How do I net it out? 1) everyone lies, and 2) I gotta take it on myself to judge what’s safe and what’s not (fyi our passports are sitting in our car which is full of gas, in case we have to flee Tokyo again).
I have 2 other thoughts: 1) it’s amazing that a Richter 9.0 earthquake (3rd largest ever recorded by mankind) and a 30 meter (100 foot) tidal wave didn’t do even more damage and further obliterate the scene. If this happened in Tokyo or LA, man we wouldn’t be worrying about who’s lying, we’d be getting our arses out of Dodge. Am sure you agree! 😉
Bill,
Your plan is good except for one thing. Gary says we won’t get another chance for the end of a C wave for years.
Gary does indeed do what you are waiting for him to demonstrate to you, but the better plan would be for you to pony up the $20 and read all the past history.
Otherwise, you’re risking a lost opportunity. This isn’t the stock market where there are new trades every day.
I’m a subscriber now. 😉
Thanks all for your support.
I’ll be in the back of the bus now.
Tuesday is May expiration (standing for delivery) and Friday and Monday many commodity markets are closed, low liquidity.
Plus, Wednesday and Thursday are usually soft days for silver and gold.
Now add to this being late in the timing band on the daily and gold tagging 1500, a sharp correction would not surprise me in the least.
I hope no one is leaning long too much today.
TZ,
Don’t be so arrogant as to say TA won’t work for AGQ. I traded the previous 174 cycle low using P&F for back + fill. IMO, /SI SLV and AGQ are great reflections of each other and best used conjointly.
WB
Don’t get too married to the idea that this is a blow off C-wave. Gary was saying last Winter that the C-wave was coming and it didn’t. We got a normal, nice intermediate rise out of the yearly cycle low last Feb, then a mild intermediate correction followed by that very large move out of the summer. (QE2 was on the way and was officially announced on Nov 3rd)
I know Gary is pretty set on the C followed by massive D-wave, but I’m personally leaning towards this being a milder cycle in gold and miners followed by a milder correction. Rise and repeat as we go along until the final blow off top possibly years from now. Not that I’m going to hold onto my positions during the intermediate decline, but my expectations are not too high for a major move having to happen in the next month. (Gold 1700 then to 1250, silver 60 to 24, etc.)
I do think we have something extremely unusual going down specifically in the silver market totally unrelated to inflationary pressures. Yes, other commodities are doing well and gold certainly making some nice gains, but OBVIOUSLY we have caught the right metal at the right time.
Welcome Bill. You’ll really like it here.
Jayhawk,
>>>Don’t get too married to the idea that this is a blow off C-wave. Gary was saying last Winter that the C-wave was coming and it didn’t.<<<
That’s interesting. Was that winter 09-10 ?
DG,
So no buy signal on SLW? I’m in the same position as you. Decent chunk in AGQ/HZU and lots of dry powder just waiting to jump back in. Are you thinking going all in metals when you jump back aboard? It’ll be greatly appreciated if you post when you do. I’m going to follow your lead or wait for Gary’s signal.
SD Jack: Regrading the TBT chart—looks to me lime it blew out on the downside and reversed on heavy volume (and TLT on the upside) in mid-March and has now gone back down to test that reversal. If that test holds—and i believe it will—TBT should have a nice rally. I have (for me) a wide stop on it.
BTW, I had a typo: I bought TBT at 36.17, right at the close, not 37.16. Good luck!
Yes Wes, I meant to put that. The difference is this year the 3 year cycle low on the dollar is due. I just think even if the dollar bounces, other currencies will take their turns going to the wood shed like last Spring. (Dollar rallied with gold during the crisis in Europe)
Thanks DG,
I really appreciate your guidance.
Regarding that article on the miners…I’m not buying it. For SLW to completely decouple over the past 2 weeks is extremely odd. They are not a “miner” as we know. Juniors too just doing nothing. So very odd.
SD Jack,
We may or we may not see a correction. If we do, it will likely be the last one of this C wave. If we don’t, the C wave will just continue to grind higher and higher till it’s done.
This buying on the correction, not sure where that came from. The answer is yes if you have more funds to commit. Hopefully most here are very close to a full position, so there shouldn’t be much buying on the next correction (daily cycle low) –IF– we actually get a correction.
How long till the C wave is done? Maybe just a few more weeks, maybe late April or early May. However, I believe the current thinking is it’s likely to last till June. After it’s done, we’re out because there will be one helluva “correction” that follows: the dreaded D wave.
Wes,
I don’t understand this part of what you wrote:
“Now, what the Fed is actually doing
under QE2 is exchanging short term debt for long term debt. They certainly aren’t printing dollars. Only the Treasury can do that.”
I thought that they were buying Treasuries. Doesn’t that mean they are paying dollars for long term debt? Where do those dollars come from if they aren’t printing them?
BobLovesH,
I thought next Wesnesday (April 27) was the significant date this month for futures because it’s Last Notice Day. Doesn’t that mean that’s the last day contract holders can specify whether they want delivery? And hasn’t that date in prior months had a significant correction just prior to it?
DG,
When you invested in TBT today, what kind of rally, %-wise, are you looking for before you get out?
Congrats Bill. Welcome aboard!
Bill,
Glad you are safe. How is the public morale there?
USD just broke below support. Should be interetsting to see what develops.
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Got a bit of a wedgie thing going on the dollar. If it breaks higher, above the upper TL, then we probably made at least a daily cycle low on the dollar a couple days ago. If it breaks the lower TL (tomorrow it’s at roughly 74.62 on the June futures), then look out below, the 3 year cycle low may be dead ahead. Until it does one of those two things, we’re just waiting IMO.
The Fed is buying the debt back from the primary dealers (PDs – who purchased it in the first place) with dollars in digitized form which is transferred to the books of the PDs. Therefore, they can say they’re not “printing” money, but it’s the same thing because they’re creating money/monetizing the debt.
The primary dealers then turn around and buy the markets, especially the commodities/metals which is driving everything up, including the global food prices. Starvation is occurring in some areas of the world because of this “policy.”
Anybody have instructions on how to post a stockcharts chart.
Pima,
The actual transaction is:
1. The Fed creates a short term bond from thin air.
2. They then exchange it for a long term bond thru a special dealer.
3. When the bond they acquired matures, they give the interest to the Treasury and destroy the bond.
4. Now everything is back in balance with no money created.
So, in effect (except for the psychology) nothing has happened. That’s why it doesn’t work.
Driver,
That’s my understanding too.
However, if the Fed dumps the Treasuries in the future (and thus takes their “printed dollars” out of circulation), then they have not monetized the debt after all, right?
Wes,
Thanks. Okay, I did not understand the part about exchanging short term debt for long term. I thought they were exchange dollars for long term debt.
So if what you’re saying is correct, that all they are doing is exchanging one kind of debt for another, these questions arise:
1) Why does everyone think the Fed is printing money?
2) Why does everyone think that QE is causing inflation in stock and commodity prices?
Can anybody tell what the miners (GDX and SIL) are saying relative gold and silver? Are gold and silver just catching up to the miners or are the miners signaling something with their divergence?
Thanks folks for your encouragement. I think it’s great to have such a rich group of successful talent to learn from.
The morale in Japan is a bit bi-polar – in Tokyo (nearer to the earthquake) it’s still pretty bleak – almost depressed – but farther away in Nagoya (where I went) and in Osaka (I heard) it was just a blip and it’s business as usual. The depression in Tokyo is caused by listening to all the survivors speak about still looking for their missing spouse or missing child. Really hopeless. We lost our son to cancer, so I can relate a bit.
Gary,
Does the C-wave necessarily have to conclude with a dramatic vertical move?
Couldn’t we achieve the euphoric sentiment more slowly with a steady, grinding melt up from now until June?
Actually, the latter would probably keep more riders off the bull — these people would keep waiting for a pullback that isn’t coming. Then one day in June, the bottom drops out.
The gold and especially silver markets are thin. That’s why these C-waves end as parabolic rallies.
pima,
Now you’re asking the questions I was asking many months ago.
The psychology is striking. The Fed actually said this was their intent, to increase asset prices.
Now think about this for a minute. The fear of inflation is a much better driver of asset prices than is actual inflation. With actual inflation you have the Fed raising interest rates and otherwise interfering with the rise in asset prices.
Without actual inflation, you get none of the interference. This is a much better deal for gold bugs.
Thanks Mr. M and Jack for your above insights re options :). I’ll load up on DITM SLV calls and utilize the leverage for all its worth during the last leg up of this C Wave!
Federal Reserve Debt Monitization for Dummies (complete morons).
http://www.youtube.com/watch?v=89pOwgCZJ7I
Wes,
I don’t want this to get into a pissing match, but here’s what Business Insider says about QE:
“The term quantitative easing (QE) describes a form of monetary policy used by central banks to increase the supply of money in an economy when the bank interest rate, discount rate and/or interbank interest rate are either at, or close to, zero.
A central bank does this by first crediting its own account with money it has created ex nihilo (“out of nothing”).[1] It then purchases financial assets, including government bonds and corporate bonds, from banks and other financial institutions in a process referred to as open market operations.”
So they are saying what I previously thought was happening: the Fed is buying long term treasuries with newly created money. If this is true, then your explanation (exchanging long term debt for short term debt) is incorrect.
Does Business Insider have it wrong?
Nightly report is up.
Gary, so are we still waiting to get back in? Or should we take a 50/50 chance and put half in or scale back in on daily lows? Or just sit and wait for dollar confirmation? Thanks
“BTW, if a runaway rally gets going silver will probably cut through $50 like a hot knife through butter.”
I really like the sound of that. :oD
If USD falls further, stock price will raise which fuel the miners to follow the gold and silver price increase.
I noticed a 1-2-3 reversal on SLW and SIL today (if I have the correct understanding). So, I may increase my exposure knowning Monday’s low is the failure exit point.
Gary,
Nice report. Regarding the ascent stocks made from July 2006-Feb ’07: I was suggesting earlier that maybe this is what gold’s final climb to the C wave top would look like, as opposed to a parabola.
If I read you correctly, that probably can’t happen as the PM markets are so much thinner than equities that once all the Big Boyz begin doing “capitulation buying” then the PMs *must* go parabolic.
Hi guys,
Just found a few free minutes to check on the markets. WOW. Got to say seeing $44 Silver makes me a little envious, but I’m glad many here are making a killing. Congrats
Got to say all this talk of a runaway move are alittle premature and might be a scary setup, considering were still in normal cycle bands, let alone stretched. I’m all cash and waiting to pull the trigger, buy seeing these prices and my stubbornness are keeping me out.
Shout out to the SMT gang, all the best. P.S Wes, I’m with you on the “Debt Spending” but you know this isn’t the crowd 🙂
Also, I would be careful thinking a pullback will never come because of some runaway move. Even parabolic runaway moves often have violent shakeout moves, you could argue bigger moves too.
Poly, I am with you waiting to pull the trigger, but the prices, want to wait for the shake out, but… if it’s not coming, how long (or should I say, how HIGH) will you wait to get back in?
Thanks, any insight appreciated, first C wave for me.
Gary,
Love the report tonight!!!
Nuts ‘o steel.
Hot Rod, damn right. Nuts ‘o steel!
pima,
Only the Treasury can create real money. That’s the law, plain and simple.
But, if someone wants to look upon a short term T-bill as money, it’s O.K. with me. You can take one to any bank and walk out with cash.
Now if you carefully read the quote, they are not even mentioning the US Fed. I frankly don’t know the strict definition of QE, but the US Fed has not increased the money supply.
I can say that with confidence because the money supply is still not back to where it was in 2009.
See this :
http://www.shadowstats.com/charts/monetary-base-money-supply
At ease, I won’t ever pull the trigger without a pullback, but that just because of how I trade. I will miss the rest of the move in that case. But a nice pullback, say 10% and I will be buying as this board lights up like a Christmas tree.
I’m going all in tomorrow. For those of us that missed the lastest run up, I’m leaning towards GDX or GDXJ to put most of my money to work, with a smaller portion towards SLV. After reading the piece on TSI and getting a buy from another source I follow, I think the miners are set to explode higher. “Super force signals” is the other source I follow. this was his latest recommendation.
http://www.321gold.com/editorials/sfs/hubbartt041511.html
Thanks Poly. I think I might consider scaling back in and take it as it comes, bit by bit, buy on the daily lows, then if a pullback comes… go all in. I was looking to buy at the opening this morning with the lower prices, but held off thinking it might be the dip starting, but no such luck.
Gary,
If we are indeed entering a runaway move, how are we to interpret the recent severe weakness in the miners?
Normally that weakness would indicate a correction is on its way.
(I’m having flashbacks to the beginning of the year, when we got head-faked and whipsawed.)
Pima, just saw your post to me, Wednesday is the day, and those just speculating exit their positions with a kick in the pants from the smart money that knows they must exit.
This time, the markets are closed for two days prior to that day, and my view is it allows for some short term games to the downside.
Funny how these things happen around Gary’s daily tops.
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pima,
One other thing I’ll point out about the quote:
>>A central bank does this by first crediting its own account with money it has created ex nihilo (“out of nothing”).[1] It then purchases financial assets, including government bonds and corporate bonds, from banks and other financial institutions in a process referred to as open market operations.”<<
Notice that they say the central bank “credits it’s own account”.
Even this quote doesn’t go so far as to say they use cash money to buy bonds, and I can assure you they don’t.
Poly,
I would welcome a big shake out…as would most, I think. I think you hear the chatter that there might not be one because some of us (myself included) are getting impatient for a better opportunity to add!
PST,
Specifically what did Cullen get wrong and which article are you referring to ?
I like to keep up with these things.
Catbird, Gary said that the moment you can’t wait to enter anymore, itchy trigger fingers, that is when the correction will happen, right after you get in. So we sit, damned if you do and damned if you don’t. 😉
POLY
Wish you were here trading with us still…you’ve been here longer than me, and you should ride the whole trip with us I.M.O.
BRIAN
Are you using windows 7?? Thats the only way I know (other than subscribing to Stock Charts) to post a chart from there.
Thats why at times , I am on my laptop, and mention a trade but do not post a chart. My laptop is windows XP and cannot ‘capture’ a chart from that site.
I have to use my home P.C. with windows 7 to CAPTURE one from ‘stock charts”.
CATBIRD
Creepy mugshot brutha!!
yes! silver trading above $44. Love 24hr’ness of forex. get in, get out and fast as you can and repeat. <—-just like on a first date!
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Nitro, I have forex on my trading platform (Trade Station). So is that how you can trade 24 hours? Hmmm, didn’t know that. I will call my guy tomorrow to see if I am set up for it. It comes up if I select the link. Just not sure if it is usable on my accounts.
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Hey Poly! Good to see you back. Are you gonna be buying any SLV or SLW options at a pullback? Would you post if you do?
forex markets open virtually 24hrs so I’d suggest you get it. if the parabolic move hits overnight, we can get out at the top and let the suckers with stocks run towards the exits come 9:30am. LOL
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Ok, so I need to investigate forex markets. Are you buying the same stocks or different products on forex? I will go in and read ab out it and see what I can find out. Any recommendations on what Gary is advising that trades on forex?
Wes,
One last thing, then I’m going to call it a night. I should have included a number 3 in my prior email to include QE…so here it is:
3. The Fed purchases assets from the banks (MBS, treasuries and agencies in QE1 and 2-10 yr. treasuries in QE2), using funds (again electronic debits) that they effectively create out of thin air. The banks must then reinvest these proceeds in other assets and investments. Again the Fed may not be “directly” responsible for this additional liquidity chasing risk assets, but the Fed provides the banks with the capital which then makes its way into the markets.
And this is just QE, and doesn’t include all the other liquidity facilities that the Fed provided during the 2008 meltdown.
Wes,
One last thing, then I’m going to call it a night. I should have included a number 3 in my prior email to include QE…so here it is:
3. The Fed purchases assets from the banks (MBS, treasuries and agencies in QE1 and 2-10 yr. treasuries in QE2), using funds (again electronic debits) that they effectively create out of thin air. The banks must then reinvest these proceeds in other assets and investments. Again the Fed may not be “directly” responsible for this additional liquidity chasing risk assets, but the Fed provides the banks with the capital which then makes its way into the markets.
And this is just QE, and doesn’t include all the other liquidity facilities that the Fed provided during the 2008 meltdown.
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with forex, I’m buying paper gold (10oz/per contract) and silver (500oz per contract), and oil (100 barrels per contract). so whatever you hear reported on the news pr gary’s report, you are trading at that price. I have stocks in HZU/AGQ and SLW but they are small compared to how I play it in the forex market
Nitro, do you trade out of your same account, that you have set up for regular equities, stocks, ETFs, options or is forex trading out of a separate account. Can you trade forex in an IRA account or a regular margin account? I see that I can open a forex account for $5k to start.
Catbird,
I chickened out today. Took my profits and ran (turned off the computer). I really need to get my head together tonight. I’ll be back tomorrow with a game plan for sure.
make sure your forex account has spot gold and silver included before you open an account there.
should say XAU/USD or XAG/USD pairs
Nitro, Glad I saw your post, I sent my broker a request to send me forms. Since i am out of the country even by sending by email and fex ex, it won’t get back to them in time to trade this C wave, but gives me something for the A wave to get into. But definately cool, will get into this. I tend to watch the night markets as well, so why not?
Thanks Razvan, I will let the broker know my intentions. Thanks for clarifying that. Do you trade in an IRA or regular account?
my forex trading account is separate from my stock accounts. stock accounts are in the form of tax free savings account and self directed rsp account. forex account is with the UK forex.com. Got in before they made it mandatory to disclose social insurance number so *technically* my gains aren’t reported to the canadian govt. 🙂
so silver keeps making new high? I am loaded up on slv july 38/39 calls bought during the s&p downgrade and up quite a bit.
did we get daily swing low yet?
CMT,
Re: PSLV, my sentiments exactly- I used to curse PSLV weeks ago for underperforming and dumped a lot as as well.
But now, premiums today are >25%!!!!
Insane!
Nitro, Razvan. I have a business entity account I trade through for income/expenses so I may set the forex account up through that. However, the bulk of my funds are in IRAs. Will have to see what I am able to set up in the US. Thanks!
regular account not IRA. Forex accounts are quite exotic investments so i doubt you can trade currencies with IRA funds.
You have to be careful not to get caught up into using to much leverage because you have the option of going up to 100:1 on some brokers 😛
E,
How do you know when to sell those options? If we are confirmed in a runaway, is there a sweet spot to look for or do you set a specific target?
I choose to consider it auspicious that we heard from Poly and David tonight!
July $50 SLV calls have a premium of $0.98 and a delta of .2323. This is 9.2 times leverage.
Am I missing something that those seem too good to be true?
Anyone own any $50’s?
Vonda,
does that mean we should buy now or hold tight? 🙂
Bamster,
Thanks for the link.
I have also been thinking of going into GDXJ instead of SIL next go around.
I also readi TSI (John T) avidly.
However, how is “Superforce SIgnal”‘s track record?
thanks,
What is
Bosco-
I saw that SLW trend line break too, good eye. Kind of looks like a falling wedge pattern.
I’m starting to think all this bearish talk about the miners is just what the doctor ordered to launch a massive rally. Take the contrarian view here. Not gonna chase AGQ at this point unless we get a nice sized dip to the 10, possibly 20 MA.
Bamster-That link wasn’t working and I couldn’t find the article.
Saw this one from Stewart Thompson regarding the miners. Interesting.
http://www.321gold.com/editorials/thomson_s/thomson_s_041911.html
Nice report Gary, ‘ol steel nuts. In future editions, can you pls post what you’d do if you were underinvested? I don’t have a core position is why I’m asking. Thanks.
Poly, like KAL requested, I too would appreciate it knowing when you get back in, and into what, and why. It’s good to learn that you wait for pullbacks. I’m new here and am following Gary for now. Thanks.
BEKSACHI
However, how is “Superforce SIgnal”‘s track record?
I have read his reports as posted on various web sites. He is wildly bullish and has some good calls, but he also just ‘buys’ all the way down through a correction, so he is in the green at every run, but his actual ‘price targets’ have not always gotten hit.
Jayhawk
I read that report too, I particularly liked point 16 onward 🙂 I was biased though , waiting for these miners to move!
Hot Rod, You know if something seems too good to be true it probably is…
Buying options into strength is a death wish IMO.
Bill,
I may be wrong, Please correct me anyone
I thought I read that POLY simply went to cash ,not waiting for a pullback to buy, but ecause he was going away on vacation and didnt want to be invested if the markets had a large correction.
I am not sure if he is even buying at all now…
…Poly?
Wow, the move on the Eur/usd is pretty impressive!
Alex, I am a member at stockcharts. Only have windows XP. I have seen other people here post their charts, but I’m not sure how to do it properly. I find jing cumbersome.
86d4life,
Means the big guns have arrived for the showdown. 😉
BRIAN
I use screencast.com, BUT…to clip a chart from stockcharts.com, you need to be a member (they’ve made it so that you cant copy /paste charts like you used to.’
On my desk top I have Windows7, and they actually have a ‘clipping’ feature that clips a chart from anywhere.
Brian,
I am not a member at stock charts, but I know that there are at least 2 ways you can post. Here is a link to a guy I follow who has a portfolio of charts for public viewing.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs40728610%5D&disp=O
For me as a non member, the way I do it is I go into the chart and there is a “linkable version” button I can press. However as a non member I can’t post annotations, just the regular view.
Sorry – this may not be a big help – you might want to check out there help menus. I would bet that you can do it with XP.
BRIAN
I totally missed that you said , ‘I AM A MEMBER of stockcharts , you idiot Alex, read my words before you reply!!”
Sorry 🙂
@hotrod, I own July 50s too, with avg cost around .80/-
To answer your other question, I like to scale out slowly once I start getting my pre-determined target probably around 30-40% and go from there. I have learned to take profit at regular intervals, and if the trend is strong then I will keep adding too.
Beksachi,
Super force has a very good record. They have different buy and sell stages. There latest recommendation on GDX and GDXJ were given yesterday, and were both strong buys.
Bill,
Here’s the thing. Some people sold everything expecting a correction. Not the best strategy in a C-wave finale.
I sold 15% of my AGQ position to convert to DITM call options on SLV. I wanted to add a little more oomph to my portfolio. I tried to pick the top as best I could. But obviously I missed it (pretty tough to do in real time). But I am still heavily invested despite taking down 15%.
The risk is that one could sit and let a runaway move get away from them because they are afraid of a minor daily cycle correction. Gold is very late in the daily cycle so even if you end up buying at the top the correction will be brief.
Then the next cycle up will begin. This still has a good ways to go yet. Is it really worth missing the first half of a runaway move to try and avoid a minor drawdown?
Probably not. I would say at least get half of your intended position at the open and that way you have some skin in the game in the event a runaway move does get started.
And if gold does correct then you also have some dry powder in reserve.
BRIAN
I set up the chart as I want it…ex:
1) 3 month/daily
2) MACD
3) Stochastics
then I hit ‘JAVA’ listed right below the chart or ‘Flash” -and it allows me to annotate the chart.
after you do this, if you’re a member , the upper right corner says “upload’, that allows you to copy your chart, or save it to your p.c.
I save mine to my desk top, then on http://www.screencast.com I ‘upload’ it to my library. It then assigns a link to it if I want to share.
clear as mud?
I tried that linkable version, but when I click on the link it takes me to my account. It made me gun shy thinking it would expose my account. I guess I need to hear from another stockcharts member to be sure or test it while I am close to another computer I am not signed on with….
Thanks Alex for the feedback on “Superforce Signal”s.
Of the free sites I follow which do have a fairly good track record (in my opinion):
1)Turd Ferguson (he as been correctly bullish these past few days) thinks there will be a pullback next week- this aligns with the the options shennigans expiration on 26th-28th like we saw last month.
2) Jesse Cafe’s- he is always cryptic (I think English is not his 1st language) but even he seems to have scaled back on metals today at close.
3) James Turk – disappointed that he did not issue an explicit warning for short term correction- but instead he expects 50$ silver by end of June.
ALEX,
The Ben Bernank is just trying to keep prices stable while maximizing employment…what’s so creepy about that?? heh heh
Wav Ridah,
So are you all cash now? Yikes…don’t do that until Gary gives the word.
Thanks Bamster for input on “Superforce Signal”.
I’ll likely wait till next and/or Gary’s signal and will be going into GDXJ.
…at ease,
Be very careful with Forex. It is highly volatile, and can wipe clean accounts if you aren’t careful. 2 things; Never hold tight stop positions over the weekend, and Never take a position that is 2-5% of your total account value. For most, that is Mirco Trading.
I made money in Forex, but I’ve also lost a lot of money. I haven’t traded in about 2 years, miss it sometimes, but not the grief & sleepness nights wondering it the trade will go the other way, in an instant.
Thanks Alex, I will re-visit my screencast account if I can’t be happy with how stockcharts does it. I have seen people do it from stockcharts so I’m fairly sure it can be done right.
Blogger catbird said…
ALEX,
The Ben Bernank is just trying to keep prices stable while maximizing employment…what’s so creepy about that?? heh heh
Well, he has AUDIT inscribed in his forehead, so I was afraid the S&P would AUDIT and downgrade him too…before he’s done printing and the C-wave finishes it ‘thing’ here.
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Gains and subsequent Corrections since end of January. It is very interesting to see that after every gain of $4.50+ in Silver prices, there is a correction. Nothing to do with Gary’s analysis, just some patterns I am following and thought I should post for fun and any comments.
26.40 30.51 +4.11
30.51 29.67 -0.84
29.67 34.31 +4.64
34.31 31.71 -2.60
31.71 36.75 +5.04
36.75 33.57 -3.18
33.57 38.18 +4.61
38.18 36.44 -1.74
36.44 41.98 +5.54
41.98 39.71 -2.27
39.71 44.33* +4.62 (in progress)
Beksachi,
I follow other newsletters, BUT I only ACT on what Gary says. I’m not leaving my wingman.
Brian, cant you just zoom in and do a screen capture?
WHAT IS WITH PEOPLES NAMES ON HERE?? I have to keep scrolling down to make sure I spell the word I’ve never heard before correctly!
ANYWAYS…
Dallascpf
I love patterns in motion like that.
…and still got it wrong in the end…hahaha
Alex, Poly might have said he wasn’t buying but . . .
4Life – for me, it means hold tight. But ultimately I’d say their reappearance is a sign of increased profitability for all!
I’m desperate, I admit:
Catbird’s sacrifice evidently hasn’t taken hold yet. Response to my nightly descent dreams? Nada.
I’ve even started singing “GO DOWN (Moses)”
At least it’s the season . . .
E,
What is the best way to enter an options position? Let’s take the Jul $50 SLV for example….
Bid / Ask is $0.95 / $0.98.
Would you put in a limit at the bid/ask/in between or below bid and let market come to you?
Let’s say one wanted to use the morning hours “weakness” time periods to buy into the calls and try to get the dip, but the farther out of the money options aren’t as liquid?
With these options under a dollar a penny here or there can make a lot of difference, right?
Today, it was actually down 2 cents or 2 percent whole many of the other options were up.
No worries Alex….I live in Dallas and am a CFP, hence the name dallascfp.
DALLAS
NOW that makes it SO MUCH easier!! I should have broken it down myself…sorry Bro!!
P.S. I got the biggest steak in my life in Dallas (porterhouse)
VONDA
You just hang in there and your dreams will come true 🙂
Bamster,
Agreed- if only I had followed Gary’s advice all along, I would have sold off a lot too early, and would NOT be now scouring other websites looking for upcoming “correction” signal to make myself FEEL BETTER!!
🙂
Vonda,
Indeed! That “sacrifice” is now nicely in the black. Quality problem.
Your turn tomorrow : )
Thanks, Alex!
There was some mighty g-force in those rickety elevators: I was plastered to the ceiling!
(Good job spelling my name, btw.)
Dallas-
Pretty cool, we are getting close eh?
The average looks to be 4.78 followed by a loss of 2.12. 2 bucks off here gets us to the 10 MA.
I tell you, CatBird, I’m seriously thinking about it.
Stubborn, stubborn, stubborn refusal to capitulate and buy- knowing it’s what “They” want me to do.
SD Jack, Thanks for the forewords. I think you can do that with options also. Good to know upfront, as it’s not fun learning the hard way all the time. 🙂 I want to investigate fully before getting into forex. For now, I need to pay attention to this C wave and managing trading 6 accounts. If I get through this, I will have time to look at my other options, but can meanwhile get paperwork processing if it is something I think I can use.
One of the things I learned from Gary was not trade and sell thinking it is overbought or oversold. Once you lose your position in the bull market, it becomes difficult to buy back in, trust me, it will be very hard to get in again because you will always want to catch the price lower than your sell price. Then it is too late and the price will keep going higher and you will never be comfortable to get back in.
Vonda,
Think of it this way: What’s stopping AGQ from hitting $330 (<10% away) before the PMs correct?
Well, maybe the long-awaited correction takes AGQ only back to $290– a $40 haircut from $330. That’s barely below where it closed today. Yet, I think it would make ill-informed latecomers soil themselves.
You Betcha, Vando!! 😉
One way to post a stockcharts chart is to hit “linkable version” below the chart.
Then copy the url, and paste it into your post.
Then others can copy and paste the url into a new window to open the chart.
Thanks Jayhawk. I am thinking $44.75-.80 should be the price if this pattern is any good.
You’re right, CatBird. Absolutely right. And I’ve never found myself frozen in the headlights like this before. So I’ll muse over my complexes OFF of book time and get back to the reality of the numbers. Thank you for that!
“Vando” – I like it. Makes me feel all broad-chested 😉
Link to Jim Rogers dismissing silver price manipulation theories:
http://www.youtube.com/watch?v=FBzWanlBTe4
I mean, I am in. 10%. Also in the friggin’ black.
Never been so upset with profits before either.
All right. I’m taking the leap. Tomorrow.
If anyone has thoughts on timing (I think Gary told Bill just go for the opening), I’m all ears.
Vonda,
I always see what the low was the day before and see if I can get in on that. If it looks good, I am getting back in tomorrow also.
I preserved my profits since February, but need to get back in the game. So if it looks good will scale back in slowly on the best buys in the selections of funds. And save the rest for corrections or dips. 🙂
Gold just took off and broke 1500 again…last print 1500.46
Thanks, atEase,
Admirable strategy and it sounds as if it’s worked for you.
The 10% committed is in miners. Think I’ll rev up to 60-70% with AGQ. You should feel the burp in the market right after 🙂
Good luck with your reentry!
LOL Vonda, you too, good luck.
It was too hard sitting out here watching the grind UP without us!
Yes, AtEase, it’ll be much more fun watching it plummet WITH us!! 🙂
Night all. I am to bed. Trusting those in the other hemisphere will soon be up, keeping watch for us.
When the VIX is low…
YOU GOTZA GO!
posted last week…..I think we are going to see a shot at 43 by close..(which I hit dead on nuts) Now we would have to see a $2.70 pullback just to hit 40 again from last week. Now for this “pullback we would have to see a $4-6 quick pullback for a decent pullback… $4-6 buck quick drop seems unlikely IMHO…. Anyone wanna follow my blog????
Lots of sympathy on procrastinating entries
I am at 95% and comfortable for the day, now is that worrying? I,m sure I should be more fearful!
I,ll probably get the fear when a scary correction hits or an even scarier run away move
I loved the Dallas data too. Damn…
In the end though I,m more concerned missing exit call at the top what with work and all sucking up time
Lol in the am all
Almost comical how gold keeps kissing $1500 but just will not poke above it. Nobody wants to be first.
Catbird,
Not all cash but about 85%. I’m usually 100% so this is kind of different. I’ll post my plan when I figure this out. GN all. Tomorrow looks like it could be interesting by the overnight action.
Vonda,
FWIW, you might take a look at this so you go in with eyes wide open.
http://tfmetalsreport.blogspot.com/2011/04/something-to-consider.html
TF is an absolute mega bull on PMs. He foresees a dip in a matter of days but he’s not concerned in the slightest.
Gary, Are you still shifting voer from SLV/AGQ to GLD at a certaqin price and are you still out at $50?
Or has this runaway action going to change that plan? Just checking cause we are getting close to both. Thanks 🙂
If the dollar can’t correct and gold gets into a runaway move everything will change. I will probably take profits at $50 and then see if silver can break through.
You’re treating me well, CatBird. Thank you for the blog posting. Another angle I hadn’t really considered ’cause I didn’t know the particulars of it.
(Still up. Still staring at 1500.)
I had thought, “Gee, if I were long–and getting nervous, what would make me more nervous? Holding through an extended weekend. So maybe wait it out and see if there’s some divestment on Thursday. If not, I probably won’t lose too much more opportunity cost and I might just catch a dip.”
But either way, I’m holding my nose and taking the plunge.
Gold price just can’t break through the 1500$ barrier. Bid 1499.90 Ask 1500.30.
Gary,
I appreciate the way that you can roll with the punches and adjust. As usual, very informative report.
Gold at $1501. if it can hold above, silver should be up near $45 🙂
Popped through the 1500$ mark a few minutes ago.
Silver at 44.40 and Gold barely made it to 1501!
We’re seeing history in the making!
Oooohhh Catbird, Interesting link!
Will have to see if it works.
Wes,
You said,
“I can say that with confidence because the money supply is still not back to where it was in 2009.
See this :
http://www.shadowstats.com/charts/monetary-base-money-supply
“
I think you are seeing something that is not there, the money supply has clearly grown far and beyond anything in 2009, except possibly the M3 measure.
I am curious to know what you think the FED uses to purchase bonds with when they perform POMOs.
at ease, so turd is’s buying the dip by the middle part of next week.I hope to do so too.I do really hope in a strong correction.
Im still sitting on the sidelines. Im not bothered if i miss this runaway move. My rules state that i will only buy after a pull back or a consolidation that shows some form of basing for accumulation. Personally i still think that dip is just around the corner.
Gary, I can’t get the April 19th report and I’m not getting an email from you for a new password (I’ve tried twice). Please help (I’d hate to miss the C-wave 😉
Hi Gary. Was gone a few hrs on my bike.
I sorta figured you’d say go buy 1/2 now and 1/2 later. Makes sense, though it sure is hard to take an inital position – weak hands, and weaker kahunas.
Market open is like midnight for me so I’ll see what muster I can manage at market close. Sure is hard.
Is taking an initial position late in the game near the top of a large C wave hard for anyone besides me? Any remedies?
Bill, I am fully out and jumping back in tomorrow. I look at it this way even if it drops it is supposed to be quick drop and back up again and will just go higher. Would rather have my position than miss it totally waiting for the dip and if it happens on the overnight hours, out of luck getting on the Bull ride. I am getting in a bit higher than i got out and preserved profits. But would rather get in now at least 1/2. Going to try for best prices tomorrow, but getting on board.
Just pick your top two or three to start getting in.
now that most of us are highly invested in silver, what specific parameters or clues will we look for to pull out of silver? Its always easy for me to get in, but selling is the most difficult part. Will we wait for Gary to send us a sell off signal?
Brian, Alex,
On posting a chart. Something I was shown. You should be able to post a chart from any chart software on any machine by doing the following.
1) Open the chart on your screen
2) Hit “Alt & PrintScreen” this will save everything you see on your screen.
3) Open MS Paint or similar (I have used PicPick which is a free download which I can link you to and is easier to use than paint)
4) In paint hit “Ctrl V” this will paste your screen capture image into paint.
5) Edit the image as you wish.
6) Save as a .GIF file
7) Upload this GIF file to your normal image sharing account. I use photobucket.
Easier than losing money on the stock market 🙂
If you use Mac, then its Shift + Command + 4 and you’re done for grabbing screenshots.
Diane,
Shoot me an email and I’ll fix it for you.
So Gary, I’m trying to get the nerve and all. I’ve noticed some chart things that have me concerned.
– Price is stretched way above 50 & 200d EMA’s – you wrote about this many times before – true, a parabolic move won’t care – but you’re right that it will snap back and hard
– FXE went up w/the Euro, but look at the volume – I just noticed this – it was strong on selloff Monday, but weak Tuesday.
– Same volume of heavy selling and weak buying on SLW, GDX, and GDXJ as well. But not in GLD nor SLV.
The net for me is, if this next rise higher lasts a month or so, maybe it’s best for me to see what the $USD does. I just feel high risk seeing RSI’s at 84, and PPO’s at 5. I think that I’m glad I joined your services, but I think that I’m hard wired (perhaps a bit like Poly) to buy only on a pullback. It it goes to infinity w/out me, that’s OK w/me. I didn’t loose anything, I just didn’t gain. And I don’t mind following you into the next A wave and doing it right from step 1. I am a beginner, after all. I’ve never traded in my life.
Gary,
Is there a chance we test 74.23 on the dollar like you once expected and then get the dollar daily cycle later this week. My gut feeling is people may be getting ready to chase this market because they just can’t take it anymore fearing a runaway move. Then just after they get in here comes the nasty correction you previously expected.
Any thoughts? Thanks for all the hard work. BTW I just got trader Vic’s books yesterday, can’t wait to read them.
King Dollar is finished (for now)! Waking up and seeing gold take out 1500 is simply amazing!
This thing is beyond strong, its a beast!
Go gold go!
The beauty of using PicPick over MS paint is that it opens automatically when you hit the print screen button.
If you hit “Alt” & “Printscreen” it it automatically captures the entire screen.
If you hit “Ctrl” & “Printscreen” it puts a red border around the images on your screen which you can move with your mouse. You just move the red border to your chart and click the mouse and viola’
what books? I’m interested in learning too! I’m a newbie at this technical trading stuff.. does anyone recommend YTC price action trader from yourtradingcoach.com?
Arun
I think you still need to save the screen shot as a GIF file before you can upload it to photobucket or similar, which is why you have to paste it into paint.
Niven,
I asked Gary for a book suggestion regarding education. He stated both of Trader Vic’s books are good.
1)Trader Vic: Methods of a Wall Street Master
2)Trader Vic II: Principles of Professional Speculation
Hope that helps.
Greg,
So what if the correction starts after you buy. It’s so late in the daily cycle that it should only last 3-6 days and then we’ll start another leg up.
Is waiting a few days in order to catch the rest of the move from say $44.50 to $50 worth a minor 3-6 day dip?
Of course it is.
The dollar has now given back all of Monday’s gains so we obviously are now looking at a dollar cycle that is going to stretch. Since the dollar cycle tends to turn on the Jobs report most of the time we may have another 2 1/2 weeks before the next short term bounce (which would in theory drive a short term correction in the metals.)
Gary, seen this yet?
http://www.youtube.com/watch?v=G-dPjDYVKUY&feature=player_embedded
Gary,
What are you thinking might be the timing band for the next four year cycle low in the S&P? Thanks!
One other thing Gary about my hesitation – earlier today I studied your Cycle charts, and was really impressed. Like you said they are not precise, but they do happen pretty regularly.
And in particular, the $USD is due for a low now, just like you said. And I agree w/you that if it does dead cat bounce a bit, that $GOLD will likely take a hit, and $SILVER even more so.
So your Cycles magic is another reason for me to wait for it. This plus the distance from the MA’s is pretty compelling.
If it doesn’t correct, and runs away instead, the move won’t last long I bet, and it will slam back down hard, like to the 200d EMA or something.
My personal belief after reading a bit is that this whole silver thing is short covering anyways.
Gold has the fundamental financial story behind it. And it will correct, and you’ll guide me when it does. Also, this gold bull will last many more years. The whole friggin’ world is in serious debt, in all currencies. No need to panic. I learned my lesson and have found a better guru.
Gary,
Aside from the obvious stretched dollar cycle, is it possible OPEX and holiday weekend (decreased volume) is allowing the correction to be delayed until next week? Maybe a nominal low of $USD to suck in the latecomers before the ‘scary’ drop. Great lesson to learn for those of you that sold your turkey!
I think that as long as everybidy is waiting for a correction it won’t happen…BUT I am not buying here either…Like you Bill, I prefer being a spectator…
Greggy,
Thanks for the book recommendations. I’ll take a look into it.
Hey Fergie,
What part of the world are you in this week? 🙂
I’m going to go with the dollar cycle stretching to the next jobs report since they have a strong tendency to turn on those. That would also set it up for a normal duration cycle into a final three year cycle low on the June report.
Silverhound
Thanks, but I was still unable to clip a chart from my laptop using that method. I just tried 3 times.
I was actually able to copy or’highlight’ the chart and ‘paste’ onto paint though , and then draw on it.
My problem is that I like to use the feature on stockcharts to annotate a chart. You have to click on Java or Flash, right below the chart to do this, but then it wont allow me to copy it or capture it (any way I know of). I can ‘clip’ it using a clipping feature in Windows 7 though.
By the way…Gold/Silver…Wow. And the Futures for SPX and Dow are way up..maybe a little miners action??
Power corrupts,
The next 4 year cycle low should come sometime in 2012. As the dollar crisis intensifies in the next month it will spike inflation to the point where the economy collapses again initiating the next leg down in the secular bear market for stocks.
That should correspond with another brief deflationary period and a strong dollar rally out of that three year cycle low lasting a year to a year and a half.
Gary,
Would it be a good idea to lighten up on some positions before the jobs report? Also are you planning to sell all your positions once silver reaches 50?
Alex,
Annotate and save. Then right click on the chart and click on “save target as”.
I’m still stateside. Looking at the JH vacation home next week. Ironically, I’m struggling with similiar entry fears that I’m seeing here, except mine is related to real estate. Too bad, I can’t make an offer to the bank in physical ounces. : )
Niven,
It depends on if gold has entered a runaway move. If it has then the dollar will become irrelevant (well other than the final three year cycle low).
All corrections will fall within the standard range and there is no way to determine when they will occur.
JH vacation home??
You’re up early. I thought I was the only one up at 4 in the morning.
Who can sleep with the fireworks going off in futures?
Gary,
Up early here in NY too, baby not sleeping so good tonight.
Just curious what u are up to at this hour out there.
I know your not hitting of the card tables. 🙂
U doing TA? Hobby?
Thanks Gary.
I’m wary of this cyclical equity bull. Went from 90% equity allocation to 10% back in November in 401K’s with no PM options. Plan to be 100% cash by the dollar 3 year cycle low with the hatches battened down. I agree with you that there’s a tremendous amount of downside risk in the S&P at these levels. Will look to reengage around the next four year cycle low.
Gary, I got up at 3:30 – playing golf at day break this AM.
Fergie, what I’ve read from Robert Schiller (Yale) is that if you plan to own for 5+ yrs, though the market goes down another 10-30%, it will flatten out, like forever. So if you’re OK w/the final dip, and if you love the home, go for it. You’ll be dead in 20 yrs anyway, so go get what you want.
Gary, looking at your $USD cycle chart again, I think we’re due sooner than the next jobs report. You know I don’t know squat about this, but if history is a guide, the way you marked the chart w/the blue arrows, and count the months between them, and project forward, we are due now – as in NOW – in fact, we are late.
Fundamentally, I can totally see it happen, w/Greece or Portugal or Ireland blowing up again. Currencies are all relative as you know.
I’m going by CYCLES MAGIC on this one, man! I will sit in a full lotus zazen, quiet and breathing, until it comes.
Bill,
Why not get in now? Just designate a small position. Perhaps 10-20% of your cash if you are really worried. If gold corrects you’ll be more confident to invest more when the price goes down. I was really worried about getting in too…heck I waited 2 weeks for a correction but it never happened. I’m very confident silver will reach 50 anytime soon even with the dips along the way and I’m sure Gary will provide an excellent timing for us to sell off our investments when the time comes.
Bill, Thanks for the early morning death wish. : ) Advocates for real estate are always saying it is a great time to buy.
Gary
For those reading your report , and seeing the Dollar where it is now…I guess since you mentioned that the ‘rest of this week…’ would be critical in analyzing the dollar -may not matter quite as much? Like , we got what we were looking for already, so now we DO see whats unfolding here?
Sorry , Not a crystal clear question, but I’m trying to preserve the content of your report.
It is not only the shorts on Silver tgat are getting squeezed…SPY Dax Nsq all scrwaming short squeeze!
Bill,
I have to ask. So what if the dollar choose to bottom here. (doubtful. If it was going to bottom it would have done it on the S&P downgrade. The fact that it couldn’t hold the rally says much larger forces are at work).
But back to my question. So what if gold corrects for a few days. Silver is going to $50 and gold somewhere above $1600. Neither one will top until the dollar bottoms.
Since the dollar is in a bear market that means at least marginal new lows. There is still a lot of downside left for the dollar and consequently a lot of upside in precious metals before we get to that point.
It’s like you are saying I refuse to make 20% because I might have to weather a 2-3% dip first.
Gold is above 1500$ as it was expected by Gary´s analysis before it might correct. Maybe the dollar has not bottomed on Monday but couldn´t it bottom today or tomorrow? Why not have the sharp correction now? If a parabolic move is starting wouldn´t the big investors play every trick to knock out even us following Gary?
NEW Post
Gary
you lightened up a week or two ago your AGQ… based on your comments to Greg, are you planning to redeploy your capital soon?
not
Right Sophia. Plus the market is wondering now if QE2 will extend or not.
Fergie, no death wish, just reality. If you’re Gary’s friend, you’re in your 50’s like he (and I), so odds are … Just get what you want and be happy. A house is a home. Screw the money. You are a human, and need to live.
Niven, if SIL rises above it’s recent pivot high of 3 days ago at 29.5, it’s a breakout (in my model) so taking a modest position as you and Gary suggest is a good idea.
But, I want to give this Cycles Magic a try. Who is waiting for it? No one, thus it will happen. I remain in seclusion in my zazen position, breathing and waiting. It will come.
Since I’m out of miners as of last week, and I won’t get caught chasing with any significant size, it looks like another day of standing aside patiently. Physical is my only position for now, and I’m not selling that for several more years.
Congratulations to those still long AGQ, what a ride! 🙂
I’ll go back to printing money and see if I can accelerate the dollar’s move lower. Rest easy, Everything is OK with me in the driver’s seat.
Thanks SB, all is good!
so there are some pretty sophisticated investors on here. Are their any ways to make bets on severe weather patterns in specific geaographic areas. Insurance pools, vegas, etc ?