Folks there are times when the right thing to do is to just sit and watch. This is one of those times. We really have no edge at all in the gold market right now. Gold is moving down into the daily cycle low and I expect that decline to be exacerbated when the stock market corrects. So there’s no call to try and pick a bottom at this time.

We still lack two confirmations that this is a C-wave continuation, so there’s no need to buy this dip yet, epecially if this does turn out to be a D-wave as there will be a lower low by the time the next intermediate cycle bottom arrives.

Now if gold can hold above the prior dip at $1087 it would be a big plus as it would keep the pattern of higher short term highs and higher short term lows intact.

I’m not terribly confident that will happen though as the stock market hasn’t corrected yet. When it does it’s probably going to add downside pressure to gold and miners.
On the plus side the right translated nature of this daily cycle swings the odds heavily in favor of gold holding above the $1044 low. So once we do put in the cycle bottom gold will have another shot at taking out the critical $1161 level.

It doesn’t make sense to buy the stock market this deep into the daily cycle especially with the negative divergences and money flows popping up (more on that in last night’s update). It’s safest to just sit and wait for the correction to unfold and then buy into the dip.

Shorting is probably out of the question as this is one of the most powerful bull markets in history. And it should be, with all the liquidity that’s been thrown at it. The surprises continue to come on the upside. So you are just asking to get kicked in the teeth if you are shorting anything right now.

Folks I think it’s time to step back and be a spectator for a while.

139 thoughts on “TIME TO BE AN OBSERVER

  1. Anonymous

    That’s it, I’m capitiating and selling gold today, looking to buy back in at lower prices.

    No sense waiting for it to go lower.

  2. Anonymous

    I couldn’t agree more that sidelines is the best place to be. The slow creep up in equities on decreasing volume portends a potential problem given a negative catalyst. In my opinion the equity markets may have a blowoff to the upside which would be the end of the incremental move and a time to move into defensive issues.

  3. Anonymous

    fwiw, which ‘aint much lately, I do believe you’re reading the tea leaves correctly. Tks 4 ur blog.

  4. Anonymous

    Now I get why the dollar had such a strong month!

    Budget deficit sets record in February
    By MARTIN CRUTSINGER (AP) – 18 hours ago

    WASHINGTON — The government ran up the largest monthly deficit in history in February, keeping the flood of red ink on track to top last year’s record for the full year.
    The Treasury Department said Wednesday that the February deficit totaled $220.9 billion, 14 percent higher than the previous record set in February of last year.
    The deficit through the first five months of this budget year totals $651.6 billion, 10.5 percent higher than a year ago.
    The Obama administration is projecting that the deficit for the 2010 budget year will hit an all-time high of $1.56 trillion, surpassing last year’s $1.4 trillion total. The administration is forecasting that the deficit will remain above $1 trillion in 2011, giving the country thrree straight years of $1 trillion-plus deficits.


  5. Anonymous

    Isn’t that the guy GG (on the ZH post) who constantly posts here telling us to buy physical only?

  6. Anonymous

    Sorry, haven’t seen GG here, but perhaps so. Have only seen him at zerohedge. But it sure sounds like he’d only like physical.

    Anyone have any info on the safety of CEF, the big Canandian gold fund. I switched to it from GLD last year do to fear of fraud. Not entirely sure it’s safer though. Any info would be appreciated.

  7. Gary

    Unless you are thinking of taking actual delivery from the GLD fund why worry about GLD? It should track gold very closely so your percentage gain is going to be the same, only you don’t have the big spreads like you do with physical and you don’t have to store anything.

  8. Anonymous

    re. SGOL. Tks. for that.

    I came across this article on various wasy to buy gold. It does say that both CEF and GTU (the big canadian funds) don’t lease their gold. I think maybe SGOL was too new to be included in that article.

    Storing gold in Switzerland sounds good, if it’s really being stored and not leased. I will try to get more info on that one.

  9. Marc


    When the PM group reaches what you interpret as a bottom, what will you be buying at that point?

    (GLD, GDX, SLV, ETFs, Options, ???)

  10. Anonymous

    On the SGOL, you can go to their website and get the list of actual bars (audited), posted daily if I’m not mistaken.

  11. Anonymous

    On the website for SGOL, they list daily the serial numbers of each gold bar they hold (audited), if I’m not mistaken.

    SIVR is for silver, and the metal is held by HSBC in the US I think, but not sure.

    These etfs also have lower expenses, and track the metal price more accurately.

  12. Gary

    I won’t be buying until gold breaks $1161. Until it does that this remains a D-wave.

    If it’s a D-wave then I don’t want to buy until the next intermediate cycle low which should correspond to the beginning of the A-wave.

  13. Anonymous

    Somebody here the other day pointed out NG and that Soros was buying in. Sure wish I had some!

  14. Anonymous

    “Unless you are thinking of taking actual delivery from the GLD fund why worry about GLD?”

    People that want to own physical gold have different motivations than just price speculating. They’re not all survival types either. There are plenty of blogs if you want to read up.

  15. Gary

    I think you will find that over the long haul shorting bull markets is going to cost you a lot of money.

    Just because something is stretched doesn’t mean it can’t get more stretched.

    Waiting for the correction to play out and then buying the dip will improve your odds of making a profit by many many times what trying to short a momentum move will.

  16. Anonymous

    For someone who claims you can’t predict the future, you sure predict lots of future, Gary.

  17. Gary

    Let me be clear. Cycles are just probablities. There’s no guarantee they will work every time. They are just a tool. And like every tool they fail from time to time.

    Heck Bernanke managed to abort a left translated 4 year cycle. Never in a million years would I have believed that was possible, but he did it.

  18. jg

    Gary, if the tin foil hat types turn out to be correct, that there is insufficient gold behind GLD, if such comes to the fore, GLD goes to near zero really quickly, seems to me.

    Who needs that excitement, when there are other gold proxies that are fully backed by physical gold?

    I think the tin foil hat types are correct, which is why I hold physical gold and silver in Switzerland.

  19. Gary

    I seriously doubt Paulson and Soros would be buying GLD if there was any chance of it defaulting.

    The conspiracy theories always seem to fly thick and heavy around gold.

  20. jg

    That’s right, the big guys never, ever get things wrong.

    Never, ever do billionaires move down to become mere millionaires.

    Just ask Trump, Macklowe, or, via Ouija board, Livermore.

  21. Gary

    I’ve got to think that Paulson has enough money to pay someone to go look inside the warehouse and see if there’s gold there.

  22. jg

    And, no way do the big shots get special terms unavailable to you and I; we all get treated the same, don’t you know.

    Just ask Buffett, on the terms for his Golden Schmucks investment, versus what Timmy Boy got for us taxpayers.

    For me, there are less risky ways to get gold exposure, and I sleep better at night.

  23. Gary

    I’m not knocking owning physical. Actually it’s a great way to ride the bull since one doens’t have the urge to click the mouse on every little dip.

    But I don’t think GLD is going to collapse all of a sudden. I feel confident that GLD will continue to track gold very closely minus the small fees charged. So if one want s to match the percentage change in gold they should be able to do so with GLD.

  24. Anonymous

    “I’m not knocking owning physical. Actually it’s a great way to ride the bull since one doens’t have the urge to click the mouse on every little dip.

    But I don’t think GLD is going to collapse all of a sudden. I feel confident that GLD will continue to track gold very closely minus the small fees charged. So if one want s to match the percentage change in gold they should be able to do so with GLD.”

    There ya go. Very nice! 😉

  25. Natanarchist

    I agree with you JG..how do we know that GLD is not just holding paper comex contracts? How do we know that GLD is not holding swap agreements with CB’s? How do we know it is not also leasing its physical?

    Also, how do we know the USA has any Gold anyway? Anyone seen it lately? How hard would it be to take a bunch of network news camera’s into the vaults and see…but you know that will never happen. Does anyone really believe we have to hide it UNSEEN so some criminals won’t steal it? Does anyone think a bunch of criminals could take all the gold out of Fort Knox/West Point? Certainly we can not trust what a Fed bureaucrat says..they lie for the politicians daily…how much has the USA leased/swapped..oh yeah they don’t and will not ever tell the People..whose Gold it is supposed to be held on behalf. I think anyone who trusts the Government or the FED to tell them the truth is being completely naive.

    CEF and GTU are far superior in my mind, because Wall Street criminals are not involved. Also look at what the Sprott Fund holds

    I think this is also in Canada..maybe with ScotiaBank Gold Vaults in Toronto..which are audited.

    and here is another link to interesting facts…its freaking sad that Americans get more honest information from Russia and China than their own government. The American Empire is dying..and good riddance..Long live the American Constitutional Republic which will revive from the Empires ashes.

    lastly..for all you dawler lovers…see here:

    11 March 2010
    Feldstein: Worry About the Dollar, Not the Euro: Keep an Eye on Sterling


    Physical Gold is insurance.

    ok end of rant…

  26. Natanarchist


    with respect to the possible coil in the dollar…how long do these coils go on before they become invalid..a week? a month? longer? is their any time frame? just curious what the general rule is for this.

  27. Gary

    No time frame. Although I would expect a break higher to coincide with the half cycle low in stocks and daily cycle low for gold.

  28. LowTax

    From the previous thread:

    “EVERYONE PLEASE LISTEN. Do yourself a favor and 1st get rid of all your pm stocks, 2nd do not listen to Gary or read his blog any longer, and 3rd there is a Bull market out, and you are missing it by wasting your time listening to Gary.”

    You mean all that money Gary helped me make last year was just an illusion? Let me check my accounts just to be sure… nope, it’s all REAL baby!!!


    Sorry dude, Gary’s ‘da man.

  29. Anonymous

    Gary, You do a nice job not taking some of these comments personally. I like your website and I value your input. With your comments, I have decided to take profits and go to the sidelines with my GDX and wait for gold to hit 1162 or drop near 1000.

  30. Anonymous

    At 5:38 EST — The Euro is currently spiking higher at 1.3790, surpassing the March 3 high of 1.37356

    And the Dollar as at 79.95 hopefully it will take out the March 3 Low of 79.82

    Interesting Development

  31. Chaim


    What are your thoughts about the possibility that gold bottoms in it’s daily cycle low while stocks still at highs. Do you envision gold working higher as stocks turn lower, rather than going lower together?

  32. Gary

    I think if gold can move above 1161 we will be in much better shape. We got tricked into this scenario back in January when it looked like gold had bottomed. Then when the stock market fell it took gold and especially miners down with it.

    A perfect scenario would be for gold to take out 1161 before the stock market corrects. Then we could pile back in as stocks correct.

  33. Gary

    No weekly swing yet. It has to go below 79.50.

    I would caution patience right now. The stock market is in a severe overbought state and sentiment has reached dangerously bullish levels.

    When a momentum move like this runs out of steam it can reverse hard. I don’t think miners are going to be immune to that.

  34. Anonymous

    The dollar is going higher and gold lower…you people here just don’t get it…1161!!!not anytime soon…

  35. Natanarchist

    “Anonymous said…
    The dollar is going higher and gold lower…you people here just don’t get it…1161!!!not anytime soon…
    March 12, 2010 7:16 AM”

    Actually we do get it…and if you were a sub to SMT you would know that. Perhaps you had trouble reading the topic of the blog post you are commenting on. I will help you…”time to be an observer” How you translate that into thinking gary or his subs are believing gold is going to 1161 soon is strange.

  36. Anonymous


    To reiterate QS’s question: do you think this move down out of the coil in the dollar portends a more lasting move higher?

  37. Gary

    I don’t really have an opinion one way or the other. The dollar is getting very late in the intermediate cycle. So at some point it will start heading down in earnest.

    When the stock market corrects I would think it would act to drive the dollar higher, so it’s anyones guess at this point.

    I’m just going to continue wiating till I get all my confirmations.

  38. Blake

    Market up, gold down….Dollar down, gold down. You would think with this drop in the dolar gold would at least smile at us. It seems determined do drop regardless of what is happening around it

  39. Blake

    if gold gets to 1090 i am getting back in. Not sure about silver though…it can drop really hard once it gets started

  40. Jayhawk91

    OK, trying to figure out these coils!

    Dollar coiling on both weekly and daily…

    So, a move down on the daily would be a false move, and the reverse out of this fake move would put the weekly coil into it’s false move of up, which would give us our true move down several weeks out.

    Gold and the miners yawning at the dollar break today has this scenario making much sense now.

  41. Gary

    I would time your gold entry with a stock market bottom.

    Every half and full cycle low since March as pushed the 3 day RSI into oversold levels and all but one has pushed the 5 day RSI into oversold. Obviously we are a long ways from that yet.

    I don’t think you need to pick a specific bottom. Let’s just watch the market and the BoW data as we go.

  42. Blake

    something i use for short term trades: when the 50ma crosses the 200 ma on an hourly chart, AND on the 5 minute chart, it is a pretty good setup to trade for gold and silver. You can usually find a pretty decent intraday stop for position sizing. A very short term trading technique, but also works well for long entries. This is for futures…which is what I trade

  43. Blake

    seems logical here. Probably get some buyers today with gold holding the check at 1100. Then monday we gap down to 1090 area to relieve them all of their positions as they stop out with a move below 1100. Then start a slow grind up that turns into our stair step move that we had last year to 1100 or so before we went exponential. Of course, that would take longer than middle of may unless it was incredibly aggressive

  44. Anonymous

    Complicated algorithm of MAs, Fib Retracement levels and Elliot wave analysis … ok .. you caught me … dart board.

    Really I am guessing, but there seems to be support at that level .. even when it dropped to 1044$ it quickly hightailed it back to 1060ish …then came back and retested 2 or 3 days later … and, even if you go to November, the 1060-1070 was a resistance area

  45. Jayhawk91

    Blake-I’ve been noticing that too on the GDX and HUI charts. I like the result after the long wait back then…whether or not we get it again is the question. We had a much weaker dollar situation back then for sure.

  46. Blake

    i don’t know anon…I would think if we broke below the 1087 mark, we would be right on with Gary’s D wave scenario and it would be very likely that we check the breakout zone in the 1000-1030 area…that would be one busted chart and would throw out any hopes of gold making a hard move up in the near future in my opinion

  47. Blake

    if the current situation does match what we saw in july-august, it would support a big drop in silver in the coming days. I would love a chance to buy silver closer to $16 again

  48. Anonymous

    Reel nice action in gold today…Covered my shorties @1100…told ya so..lower prices are coming…

  49. Anonymous

    Not shorting gold, but it doesn’t look too strong here. I prefer to stay away until it decideds to move up or down. All those inter-day swings between positive and negative are just a nasty thing to deal with.

    Gold and dollar moving down together is strange too. Not sure what that means either.

    Ahh well time for my base ticker of “C-A-S-H”.

  50. Anonymous

    gold down down down. Dawler down. Dawler to go UUP. Gold to further down. You’ve been warned. I called the dollar rally months ago on this site while garry was busy advising all you newbies to buy at the top. Bon chance mon ami’s

  51. Blake

    something else worth noting that is another similarity between now and the july-august move in gold: Gold and dollar were both dropping together in early august. Once they began moving opposite of each other was when gold began to climb again. It corresponded to gold checking the last local low, which this time was at 1087. In the first half of august, gold and dollar dropped together. then gold gained its footing at the last low and began the grind higher. I will be buying at 1090 if the dollar and gold begin trading opposite of eachother again. I think that is a fair bet given all of the other similarities between the 2 time frames

  52. Blake

    Jayhawk- If you are in miners with no time limits, then just relax. Depends on your time frame, but at the very worst, if the gold bull plays out you will be up handsomely within a year. Probably some additional short term pain over the next week(s), but not like you haven’t been through it already!

  53. Natanarchist

    curious…are people using a lot of leverage? is that the reason folks are freaking about their positions? I mean if one has fully paid for one’ s positions unless one sells, you haven’t really lost anything. Or is it the folks freaking out are those who trade for an income/job?

    maybe that is the better question…how many posters on the board trade as a means to support themselves?

  54. LowTax

    “Bon chance mon ami’s”

    Hey that’s exactly what Karl Denninger says! Karl, is that you hiding behind the Anonymouse face? Come on dude, you’re better than that! I love your work by the way, but picking on Gary is silly – he’s made me tons of money and he’s clear-headed about his trading. Can’t ask for much more.

  55. LowTax

    SPY SOS was -$105M before the last update. It was removed from the page since the SPX closed fractionally lower but I doubt the -105M was reversed… technicality. The big boys have been selling the livind daylights out of this pig.

  56. Anonymous

    I think people and Gary are putting to much importance on Gold spot vs. the miners. I don’t know what everybody is worried about or bitching about. GSS up 9%+ today NXG nicely rebounding with buying and look at their longer term charts.

    Gary, you said yourself many times that the miners were undervalued to the price of Gold. While everybody debates here about a small move here or there, they miss opportunity.

    Both short term traders and long term “investors” can buy the dips and make money.

    Instead it seems everybody here wants to worry and think they can call every little move.

    – KB

  57. Jayhawk91


    I think the anticipation and expectation of this “epic” C-wave that was hyped by Gary and many other has caused me to seriously doubt the short to medium time frame on this trade. I’m losing faith a bit here and the dollar just keeps hanging in there. 2010 so far looks to be the year the dollar’s faults get ignored while Europe and other equally screwed countries get their asses handed to them. Longer term, I think the fundamentals of a dollar bear/gold bull seems to make much sense. I just think we may be too early here for whatever reason. I try and look at the longer term charts, but the all look weak and ready to roll over (miners). I think the lack of strength in the miners while gold has been surging could be seen as a bearish sign…Especially when we have had one of the most powerful stock market runs in history since last March. If there was ever a time for the miners to kick some butt, it was then! We could have gone long banks, US Steel or any other random crap stock vs chasing this pm bull that looks to be ready to roll over and sleep for a while. My frustration today was my positions going red for most of the day in light of the dollar finally breaking 80. That was disappointing.

  58. Frank

    I tend to agree with KB here.

    My miner account was net up today because of strength in NXG. Actually it is higher today than any monthly closing statement, including end of November. (That was partly due to the the weakness in NGD because of the Cerro San Pedro shutdown.)

    Gee, I was thinking of pulling the trigger on GSS when it was below $3. Missed that one; not going to chase.

  59. Gary

    Gold is just working it’s way into the daily cycle low and it’s leading the stock market. It will do what it has to do to knock everyone out of their positions.

    But don’t forget this is a secualr bull market and the only way you can lose is to sell for a loss.

    As long as you have no time requirement on your positions eventually the bull will turn any and all losers into huge winners (provided you didn’t pick a company that is going bankrupt).

    You just have to ask yourself if you knew for certain that all your positions would be up 200% by this time next year would you hold on and ignore the short term swings.

  60. Anonymous

    Jay (3:12PM):

    Sounds like a pretty decent analysis. Encouraging that you’re putting more independent thought into it. Now you need to find a personal strategy that fits with that point of view. One that controls risk and allows for you to be wrong without gutting the account or whittling it away with a thousand cuts. No problem with being right of course. If it feels like you’re getting whipped around too much, a longer time frame, more patience and lots of discipline might be in order. The hardest part is learning to trust your gut correctly. Vague stuff I know, but you have to find a way that feels right for you. It’s almost all strategy and very little tactics in the end.

  61. Anonymous

    Jayhawk –
    I’m just not seeing/experiencing what you are. You are implying that if you bought a year ago, you wouldn’t be making money. All but one of my miners is solidly in the green. The one that is not, I bought in Jan. Just a stupid buy on my part.

    As recently as 3 weeks ago, you could have bought NXG, EGO, GSS on the dip and had a very solid return.


  62. Anonymous


    No, I’m saying the run in PMs has been mild vs. other sector since the March bottom. I bought based on Gary’s all in call back in January of this year. This was my first big pm purchase, unfortunately. I added a bit near the bottom in Feb to average down.

    For instance, you could have bought a commodity play like US Steel-X and doubled your money easily. I’m just a little bummed out the C wave didn’t materialize as advertised is all. Maybe we will all be richly warded soon, maybe it will take a year or so, but I still think eventually this will work. Cheers.


  63. Gary

    Yes Toby is the ghost writer for my new partnership. I’m trying to steer traffic to the goldscents site so we can keep track of how the marketing eforts are going without having to try and separate them from the SMT.

  64. Anonymous

    “Yes Toby is the ghost writer for my new partnership. I’m trying to steer traffic to the goldscents site so we can keep track of how the marketing eforts are going without having to try and separate them from the SMT.”

    Always knew your previous incarnation was in sales or marketing. 😉

  65. Gary

    Actually I really have no motivation to put the time and effort into marketing the blog or newsletter but one of my longtime subs and good friend finally convinced me to let him do the marketing side if I would write the articles.

  66. aviat72

    A very nice update this weekend in SMT. Makes a lot of sense.

    Very early this month I had the plan of shorting Euro near the region it is right now in. I was hoping for a spike.

    However the spike never came instead we seem to have formed a rounded bottom kind of pattern. The extended basing action has reduced my conviction in the short Euro play. It is very likely that we have a crushing stop hitting rally once the Euro closes above the 1.385 level, especially if the Fed is less hawkish than expected next week.

    The news flow from Europe has been more positive though nothing has been achieved on the ground. GS is already pumping the Euro so it looks like they are setting the stage for another big leg down, eventually.

  67. aviat72


    Will Minyanville/GoldScents be reproducing your work on SMT or will SMT be replaced by them?

    Notice the weight-lifting connection…

  68. Anonymous

    You just keep believing the dawler is going down in the s-t…fools believe GS …they will pump it to short the crap out of the euro…

  69. Anonymous

    Jayhawk –
    Sorry to hear of your stress. I guess the lesson would be scale in and scale out especially if you are following some other persons’ playbook.
    Best of luck.

  70. Gary

    No the SMT will stay right here. We’re just keeping GS separate so we can monitor traffic that comes in from marketing efforts.

  71. Anonymous

    “No the SMT will stay right here. We’re just keeping GS separate so we can monitor traffic that comes in from marketing efforts.”

    If GS traffic eventually matched or exceeded SMT traffic, what would be the motivation to continue SMT?

  72. Gary

    Hey I’ve been here for almost 4 years now. I’m not going anywhere. The GS is just so I can separate out the traffic attained through marketing.

    Generally anything published on the GS will be feature link articles, while I publish quite a bit of short technical blubs here that are not suitable for publication elsewhere.

  73. Gary

    I think energy will also paticipate in any commodity explosion although I don’t expect oil to be the leader during this second phase of the commodity bull.

    Since we are now stuck in an ongoing world wide recession the demand side of the supply and demand equation is compromised for oil. It will rise base on monetary conditions but enery isn’t going to be the leader it was in 07 & 08. I don'[t expect energy to be making huge new highs anytime soon.

    It may or may not get back to $150 eventually but gold is the commodity that will be soaring to big new highs in this phase and eventually the miners are going to follow gold. That’s the sector where we are going to witness 1000% gains not energy.

  74. Anonymous

    thanks in short term u have some opinion on energy, so in commodity beside gold silver what others can be just to keep a eye on it what the can bring up hard

  75. Gary

    I went over my short term expectations in detail in the weekend report. Obvioously I don’t have room or the inclination to try and rehash that here in the comment section. But a quick answer is we should experience a short term correction soon.

  76. pH11

    Couldn’t agree more Gary with that correction call…

    Getting ready for our regular “Manipulated Mondays”… But this time, it might be slightly different.

    DIA needs to hit resistance that sits over 107 (only another 1% needed). Then SPY, DIA, and IWM will descend into another buying opportunity. Hopefully PMs will bottom around the same time (2 weeks from now?).

    On DIA 107s:
    Could DIA ~107 be the critical level of resistance that breaks that camels back? It is clearly the short term major resistance location. But what about the past? The 107’s were the support for the 2006 bull run. On 3-4 separate weeks, the DIA descended to the 107’s. It was resistance at several instances in the beginning and end of 2004. 107/108’s were resistance in 2002….

    I personally don’t take big risks shorting in bull markets, but if you have some ‘play money’ that won’t make you feel like you’ll lose your stomach at a loss, short the weakest sector for a couple weeks using the Direxion Bear 3X ETFs – EDZ, DRV, TZA? Entry point is on THEIR intraday lows this week…. “Play money” only.

  77. Anonymous

    Wow! I will be exiting all my positions in the PM area on monday. I always knew PM were highly munipulated. I’m out. Even the miners. I will live to trade another day.
    Thanks Gary.

    Credit Suisse Standard Securities precious metals analyst David Davis has issued a warning for gold.

    Basically, the market experienced a surge of gold ETF buying over the last year, which became the key driver for gold prices. It wasn’t like this back in the pre-ETF days mind you, this is how the gold market has changed dramatically into something far more speculative than it used to be.

    Now, should ETF demand dry up, the market’s supply/demand could be horrendously skewed, according to Mr. Davis.

  78. Gary

    Seriously? Do you really think this guy can see the future any better than anyone else?

    Gold is just working it’s way down into a daily cycle low. The right translated manner of the last cycle gives pretty good odds of holding above $1044 (I’m thinking $1075). Then we should get another stab at that 1161 area.

    This pullback is a bottoming process probably not a continuation. If you’ve held this long you might as well hold through the cycle low and wait for the rally out the other side.

  79. Anonymous

    Hey Gary.

    Who is John Townsend? I saw the Kitco article and it is linked to your website.


  80. Anonymous

    The Gold goes higher for years, staying long all of my position. I’ll check back in Friday morning.

    Good luck all!

  81. Anonymous

    a week or two ago you mentioned that you had expected the stock market to correct about 10% and that the 9.something it corrected satisfied your expectation. In your last blog entry however you say the stock market has not corrected yet. I can’t put these two statements together as they are contradicting. Can you clarify please.

  82. Gary

    The Jan. to Feb. correction was an intermediate term correction that should serve to separate the second and third leg of this cyclical bull.

    We are now moving into the timing band for either a half cycle low or full daily cycle low. Either way these are a smaller scale cycle low than the intermediate term correction last month. Probably not more than a 4-5% correction before the intermediate up trend resumes.

    Sentiment is just starting to get a bit too bullish. The market needs to cool off that sentiment a bit before it can continue higher.

    There are four different magnitudes of cycles the smallest being a daily cycle (what we are working into now) intermediate, yearly and 4 year.

  83. Anonymous

    We are way over bought and I really think we are going to double dip. What will happen if war with Iran brakes out? Market should react I think, in a very negative way. Just my thoughts for now. If I am wrong then I will gladly re-post and admit it. Thanks for letting me share my bearishness.

  84. Gary

    We are very close to a daily cycle top of that I’m fairly certain. When we do get the correction it will be another buying opportunity.

    The surge out of that bottom should be extremely powerful as I expect the dollar intermediate cycle will have topped and we will have a big tailwind at our backs for the next 5-10 weeks.

  85. Anonymous


    If this hurricane occurs are you expecting new highs in gold over the next 10 weeks or just a surge up?

  86. Gary

    If gold & the dollar complete the last two confirmations then I’m going to assume the C-wave is still intact and gold will put in another leg up.

  87. Anonymous

    As soon as we get the criminal Fed out of the way this afternoon, it’s time to buy more gold, and possibly a few other commodities like sugar.

  88. Gary

    I would just ignore everything between 1087 and 1145 as meaningless.

    I’m pretty sure when the market corrects it’s going to pressure gold and certainly the miners.

    If you are holding positions just keep holding but I wouldn’t initiate new ones before we complete the last two confirmations.

  89. Anonymous

    It’s also possible gold experiences a flight to quality as money comes out of stocks, being it’s having a swing low earlier.

  90. pH11

    Here’s a question…

    Why is gold the better of precious metals to invest in, over copper, platnium, silver, palladium, aluminum, etc.?

    Example –
    Thus far in 2010, SLV’s up 16%, DBB’s up 14%, but GLD is only up 6% since the Feb 8th, 2010 lows.
    In 2009, the same thing happened from the July 10th lows to the December 3rd highs, with SLV and DBB going up > 45% each, and GLD only went up < 35% .

    Are we sure the returns on gold, from the coming PMs dip to its following PMs peak, will be more than the other PMs?

    Basically, if one PM moves faster than another, even while all of them are moving, shouldn’t you invest in the faster of movers?

  91. Gary

    I think we all realize silver will be the biggest mover. But the miners, especially silver miners and juniors should outperform even silver.

  92. Gary

    BTW copper and aluminum are base metals. Their fundamental driver is tied to the golbal economy. That is going to be in an on again off again recession for many years so I don’t expect the base metals to be the best place to be during the second phase of the commodity bull.

  93. Anonymous

    Nice move on gold and miners.
    You snooze, you lose!
    20+% positive moves since Gary said sell. NOBODY can time this gold bull!

  94. Anonymous

    silver up, gold up, equities up….



    Nice try douche bag…Have fun with your dawlers.

  95. Anonymous

    Gold up one day..hahaha…enjoy why it lasts…deflation will kill this bloated pig then buy it…not touching only to cover sharts…its been working…

  96. Anonymous

    I do believe Gary is holding on to about 25% of his position while waiting for gold to complete the last two confirmations.

  97. Anonymous

    Anonymous said…

    Gold up one day..hahaha…enjoy why it lasts…deflation will kill this bloated pig then buy it…not touching only to cover sharts…its been working…

    Miners have been going up up up. You are a worthless sack of crap. Most here are long silver and silver miners. Deflation? PFFFT.

  98. Gary

    Let’s stay civil boys. Hey if there wasn’t someone to take the other side of our trades there wouldn’t be a market now would there?

    Plus I wouldn’t get too cocky just yet. GLD left a big gap on the chart today that will probably have to fill before it can continue higher not to mention the stock market still needs to correct.

  99. Anonymous

    Quick question to help a newb gain perspective on the gold market. If you could keep all of the gold that you could clean and jerk today vs. what you could clean and jerk in the prime of your youth AND you had to cash the gold in for US dollars at their then current values, would you have more money today or back then? This really helps! Thanks!

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