70 thoughts on “CHART OF THE DAY – ALL CYLINDERS FIRING

  1. FoolsGold

    Great call on the stock market months ago Gary.

    Very interesting watching the doubters flipping over to the bull camp.

    Bubblelicious!

  2. jacob2

    Awaiting a November fire sale in the miners. Risk reward in PM’s and commodities compelling. Thanks for the update.

  3. Christian

    A very timely post Gary πŸ™‚

    Can’t help but notice more and more people – or wannabe Traders – losing sight of the big picture and getting lost in the wiggles, which is how you end up losing money in the end :/

    1. JJHarmen

      Martin Armstrong says that it is primarily money fleeing Europe that is driving up the Us markets but I think that’s BS. It isn’t just the US markets that are going vertical.

      1. Christian

        Pundits always need to come up with a reason – using sound logic of course – to try and explain Market misbehaviour, but they don’t actually understand that Markets are the results of human emotions.

        Fundamentals are a distant 3rd πŸ™‚ That’s why I never waste my time watching the news.

      2. Gary Post author

        Of course it’s BS. The European markets are going up just as much as the US markets. The Dow has only slightly outperformed the DAX since the seven-year cycle low in early 2017. Most European indexes are forming textbook perfect cup and handle patterns. There is no need for European money to flee to the United States.

        The euro has started a new bull market completely opposite of the nonsense Armstrong has been pushing about the euro collapsing. Socrates is set up to be a big trend following program. So it always misses the turns from bull market to bear market, or vice versa.

  4. JJHarmen

    You really have nailed the stock market and gold. Good work. As for copper, you might want to heed the warnings of Pedestrian which was that copper was going to $2. His chart reading skills are unmatched.

    1. Gary Post author

      Ped was wrong about copper and still is. It just needed a correction which it has now finished.

          1. vin

            Gary, taking a position is not the end of the world. If there is anything certain about investing it is that one can’t be right all the time except for the powerful crooks known as manipulators (not investors). And, I bet you that even they will wrong one day, in a VERY big way. And, we all will pay for it.

            Even though Pedestrian has been emotional sometimes yet (s)he seems to be capable. Additionally (s)he seems to be a good human with a heart.

            It will be nice if he came back? He made this site lively. What do you think?

          2. Christian

            “Additionally (s)he seems to be a good human with a heart.”

            Vin — No disrespect to you but you have no idea who this person is.. there is, in fact, a lot of weirdos out there with a lot of BS to go along with it! And although Pedestrian’s opinion never bothered me; he always took it 3 steps too far. This board is far more friendlier now that he’s gone.

            Seriously folks, if you need drama or entertainment.. turn on your television and try The Real Housewives of whatever the F*ck !!!

          3. TraderPete

            I wonder about that too! He should have stuck with his bearish slant. Although, some day he will be right. πŸ™‚

  5. jacob2

    Capitulation of the gold gurus on the web, Frank Holmes and Avi now in the crypto advising business. Business diversification, Just a way to sell more letters, or is BTC the real deal?

    1. ziasDad

      The former.

      However, BTC is the real deal until it isn’t. Tulip bulbs went up until they didn’t. I don’t know of anyone who’s figured out how to determine when a bubble will top out, in terms of price or time. Prechter & Co has already pronounced the popping of the BTC bubble with nice looking 5 waves up chart showing the first wave down. ‘course, since they published that, BTC has gone on to make a new high. So much for the 5 up, eh?

      Me personally, I don’t know what to think of crpto’s. They are nothing but air, nothing but numbers printed on the computer, not backed with anything. But that’s true of all currencies today, the US dollar, the Euro, etc. Max Kaiser whose opinions I agree with most of the time thinks crypto’s are the real deal and will serve the purpose of undermining the CB controlled banking system which Kaiser hates. But I have my doubts. How can you use something like BTC as a currency when it’s as volatile as it is??

      1. Gary Post author

        Actually real currencies are backed by the productive capacity of the country issuing them, and the governments ability to tax its citizens.

        Crypto’s are backed by nothing. It’s a pure Ponzi scheme, but like all Ponzi schemes common sense goes out the window in the face of rising prices, and we convince ourselves there really is a fundamental reason for price to keep going up and up.

        In 2006 the theory was that we were running out of available land. Apparently no one bothered to come look at the Mojave desert. Land as far as the eye could see.

        In 2008 we had reached peak oil, yet there were tankers sitting in the gulf of Mexico with nowhere to unload as everything was full.

        In 2000 earnings didn’t matter. All that mattered was how many eyeballs one could attract to their website even if there was no conceivable way to ever monetize those eyeballs.

        History is pretty clear. People just become plain stupid during a bubble. We can convince ourselves of almost anything as long as price is moving higher.

  6. Goild

    Yes, the dammed manipulators have GOLD oscillating without any particular pattern.
    Since I have a couple of glasses of wine, I would repeat that GOLD has been channeling since 2013.
    The mean is about $1220 bucks. If not take a look at the monthly candles.
    Thus prepare for more pain if you are playing the miners 3X funds.
    At some point the miners would be ridiscoulsy dammed cheap.
    The trick would be to recognize that moment., and to have the steel balls to plunge in like Livermore.

    1. Gary Post author

      Just run the percentages for the Nasdaq and then assume a similar move in the Dow. That should give you a target.

  7. desertsun999

    My gosh, you can hardly contain the enthusiasm of all these crazy pm investors on this blog……LOL! I have one chart that has called the “big picture” in this pm market for the last 1.5yrs so I’m sticking with it. Good luck fellow goldbugs!

      1. vin

        If Gary is right in his prediction of the SM, then be assured no one will be able to buy gold, I mean the real thing and not jnug etc.

    1. Gary Post author

      Generally the time to buy metals is when we are seeing all out panic in the sector (the bloodbath phase).

      Clearly we aren’t at that point yet by any stretch of the imagination.

  8. Gary Post author

    There’s no doubt now about the failed daily cycle in the yen. If the correlation with gold holds, then gold should bottom about the same time as the yen. The yen cycle has been running 40 days give or take. It’s on day 11. So we should have about 30 more trading days yet before gold finds its ICL.

    I’d look at the gold chart again and the lower triangle trend line. That’s where I would look to start buying, especially if sentiment was extreme and the COT bullish.

    1. vin

      Gary you seem to imply that dow will double to quadruple. That is difficult to comprehend. If it does reach 88k within a year then it would have done better than 1929? If that does happen which I doubt (even though I am hesitant to doubt your predictions) then the consequence will be significantly worse than what was seen in the 30s. I don’t think there is a word for it in English dictionary to describe such an economic collapse. It will be one of the worst if not the worst in more than 2000 years. Are you sure those in power will allow it to happen?

      1. Gary Post author

        Pull up a chart of the Nasdaq from the fall of 98 to the top in 2000.

        Now keep in mind that happened with no QE and only low interest rates. And by low interest rates I mean between 4.5% to 5.5%.

        Now imagine that same rally only this time factor in 7 years of virtually 0% interest rates and trilions and trillions of QE.

        1. vin

          Yes. But, now the situation is very different. In 2001 it was still manageable. To-day it is not. Have you seen the real debt figures not just the States, Europe and Japan but also China, India and Brazil. If I can add/subtract then surely those in power know it as well. It will be fireworks with a resulting pollution filled sky for all to inhale the sulpher and what not?

          1. Gary Post author

            Every great party begets a hangover, and the bigger the party the bigger the hangover.

            If the Dow were to go to 60,000-80,000 over the next 12-18 months then it would lead to a crash similar in magnitude to the Great Depression.

          2. vin

            Gary I am of the opinion, based on numbers, that if dow goes to 75k (more or less) or higher then the collapse will be MUCH worse than 30s. In 30s it was just the margin debt, and no derivatives.

            I want to make money based on your predictions but I hope that you are not right.

          3. vin

            Gary, one more thing. If your scenario happens to pass then let me say it is a futile exercise to predict the future price of gold. No one will be able to buy gold at any price, not talking paper gold, miners or derivatives.

          4. vin

            One can only buy when someone else sells. If the kind of collapse your are talking about, happens then currency will be debased, not just the dollar but all major currencies maybe (and maybe) except for the Chinese Yuan.

            The only alternative currency is gold, so far. Those who have it are already not selling it. It is not easy to buy big chunks of the yellow metal (there are may documented cases). In case dollar and Euro are debased then even the ordinary folks who have gold will hold on to it. They will not sell it.

            Just for interest. This site is loaded with gold-bugs. Take a survey to find out how many of them actually have gold. It has always been a rare commodity. In recent time it has become even rarer. As long as the trust in currencies continues …. fine. The moment there is a scare, no one will sell gold for currencies.

          5. vin

            Total amount of gold above ground is about 5,820,203,717 ordinary ounces i.e. less than 1 ounce/person. Now if you exclude the government hoarding, Indian gold (in necklaces etc.) and the gold lying in the safes of the very rich, the amount of gold in circulation isn’t a lot.

            Almost all the gold trading is done in virtual gold and not the real stuff. How they can get away with it really beats me.

  9. vaknight

    Gary, just registered to say I have been reading your posts for a while and I wish I listened to you months ago. With that said, it seems like bullish sentiment measures such as fear and greed index are over 90, which is extreme. Do you think October and early November may offer a pullback before an end of year rally? I see your point regarding the SOX testing the March 2000 highs, but that is a monthly chart and not necessarily a straight line target. How much of a pullback do you think the SPY and SOX may get to constitute a buying opportunity, or should one buy now anyway, even with extreme overbought conditions (sentiment, charts on multiple timeframes, some revenue and earnings ratios, etc.). Thoughts please.

    1. vaknight

      If you think one should buy now anyway despite the extreme overbought and bullish sentiment levels, what stop loss target you think is makes sense on a leveraged ETF like TQQQ, %10, %20? That is where the entry point may be tricky; just to avoid stopping out on a normal selloff.

    2. Gary Post author

      Be careful trying to extrapolate sentiment from one indicator. This is why I think everyone should have a subscription to sentimentrader.com. Another point I’ll make is that when it comes to momentum and sentiment, extreme momentum almost always wins over excessive sentiment. And by that I mean sentiment can stay excessively bullish for a long time before the market corrects.

      Another point I would make is that most traders waiting for a pullback invariably fail to pull the trigger during a pullback because they can’t judge where the bottom of the pullback is going to occur. They need to time a perfect entry and that is rarely possible in the middle of a strong momentum run.

      So you have a couple of options. You can just enter now with the intention of selling once the semi conductor conductor index reaches 1350 as that would be the best spot for a pullback, and not worry about short-term corrections.

      Or you could stay on the sidelines hoping for a correction and hoping that you are able to actually pull the trigger if a correction does come. Of course with this strategy you run the risk of the market just continuing to leave you sitting on the sidelines as it runs away and you could possibly miss the entire move from here to 1350.

  10. Steffmeister

    Gold going down into Hell …

    Anyone here with a chart that shows Gold in Log.scale and with the bearsh trendline from 2011 drawn …

    Tx in Advance πŸ™‚

  11. Goild

    Good morning.

    Added 1000 UVXY shares at $15.09 for a total of 1200 shares.

    Will sell them later today for a profit, I think πŸ™‚

    1. Gary Post author

      As long as people keep trying to pick tops the runaway move will continue. Like I said, I’ve seen these things last 6 to 8 months.

  12. Gary Post author

    “No this is not what is going on, Gary is too early with his call.

    No touch of the triangle bottom here, Gary is wrong again …”

    “so a top in Gold in November? lets say the 11th of the 9th month or the 9th of the 11th month?”

    Steff

    Oops Stefmeister was wrong and Gary was right again.

    1. Steffmeister

      I take it as a compliment Gary, now skip the nonsense and fork up a chart that I described please! It’s very interesting imo. and I do not have a tradingplatform or a Chart service.

      β€œNo this is not what is going on, Gary is too early with his call.
      /Can not remember, is it about Gold?

      No touch of the triangle bottom here, Gary is wrong again …”
      /We are far away from the triangle bottom here Gary, sooner or later we will break it I guess. Not a smart move to claim “victory” here Gary!

      β€œso a top in Gold in November? lets say the 11th of the 9th month or the 9th of the 11th month?”
      /A challange of the 2017 high yes, still possible! Not a smart move to claim “victory” here Gary!

  13. Gary Post author

    Even after a month and a half in the vertical market the Robo ratio still hasn’t reached even mildly excessive levels much less the massively bullish levels that went on for months and months at the prior to market tops.

    We’ve got a long long way to go before the average retail investor is ready to jump all in on this market.

      1. vin

        I know. Unfortunately, I still like to look for “value”. Biotech is the future so it is hard to resist for me. I have to learn not mix up making money with logic.

        Your advise has been right so far. But, I can’t understand how can the market go up like crazy and leave bios behind. Don’t worry I will learn. Give me a few decades.

  14. vin

    Goild, did you buy jnug? It went down to 16.35. I had put an order at 16.32, did not get filled. May be as well.

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