CURVE BALL

For some time I’ve been of the opinion that the dollar will control the fate of not only the stock market but also our favorite bull market…precious metals.

Since June the dollar has been collapsing down into a yearly cycle low. I didn’t expect that low until the dollar reached at least 74 and I thought it even more likely we would see 71 before the cycle bottomed. However yesterday the dollar threw us a major curve ball. What should have been a minor bear flag that would resolve with a downward break has gotten unexpected traction.

Yesterday the dollar broke the down trend line and it now appears clear that the dollar has formed a shortened daily cycle low.

If the dollar rises above 78.36 it will reverse the pattern of lower highs and the odds will rise significantly that we now have a shortened intermediate cycle bottom, which should also mark the yearly cycle low.
If that turns out to be the case then we can probably expect stocks and gold to turn down into an intermediate correction.
The stock market is definitely due for the intermediate correction as it is on week 19. (The cycle usually runs about 20 to 25 weeks so a top is now due.)

The gold cycle is a bit shorter at 15 weeks but still in the timing band for a top. If we end the week about where we are today then gold will form an exhaustion candle on the weekly charts.

This is why traders can’t leverage themselves to the moon. These curve balls happen. If you get caught by one of these and you are leveraged to the max you will do catastrophic damage to your portfolio.

Trust me when I tell you this. Massive leverage always ends in a blown out account. There are never any exceptions to this rule. Never!

476 thoughts on “CURVE BALL

  1. pimaCanyon

    Gary, question I posted at end of comments section from last post, reporting here:

    If yesterday’s high was the intermediate top, we will wait for confirmation and then sell into the bounce that follows.

    Here’s a question: If yesterday’s high was the IT top and we follow the plan to sell into the bounce out of the IT low, what chance would you give that bounce being at a higher price than the price PM’s are trading at today?

    I’m guessing that today’s prices will turn out to be higher than the bounce out of the low. If that turns out to be the case and if the odds are high that we’ve seen the IT top (and it looks like they are), then it might make sense to take off some positions today and then wait to take off the rest (of the total that we’re planning to take off) on the bounce out of the low.

    Does that make sense?

  2. Gary

    PC,
    I would need a crystal ball to tell you the answer to that one πŸ™‚

    I do expect we will get a healthy bounce out of the next daily cycle low as everyone will expect the buy the dip strategy to continue working.

  3. pimaCanyon

    Okay, maybe I should rephrase the question: Do you have any idea how many more down days we’ll have before we make a daily cycle low?

    Also, will the daily cycle low and the IT low be the same low?? Or will we see a daily cycle low, then a bounce, then another lower low that will be the IT low?

  4. Nick

    Well….the SPX has reversed hard almost immediately after exceeding the earlier high in april 2010….a repeat of the Double Top back in 2007, perhaps?

  5. Poly

    I bagged all of the long lines yesterday with that stupendous move. The rest in pre-market today.

    But 10-15% of net worth in a week, I dare not ask. πŸ™‚

  6. Todd

    Hi Gary,
    If the dollar breaks into new highs today, will you immediately sell some PM’s or will you still wait for the rally?

  7. Gary

    PC,

    Without a crystal ball I can’t tell you when a cycle will bottom. But I can say that the odds are we will see a bottom and then a failed cycle. Intermediate bottoms almost always take at least 3 weeks.

  8. TZ (7006)

    POLY,

    >But 10-15% of net worth in a week, I dare not ask. πŸ™‚

    Let’s just say I was up a lot more at noon yesterday. It was certainly a curve ball for everybody.

    But my positions were from much lower ($25 silver), the stops were in to control risk and I simply didn’t expect the pullback. It happens, but yesterday was managable and didn’t knock me out by far. Shame to lose those gains though.

  9. Sandy

    Gary,

    If the sell signal is hit, do you anticipate just taking the leverage off and return to 100 % invested position, or do you plan to trim your core holdings as well.

  10. Gary

    Todd,
    I maintain my discipline which means I will sell during the bounce out of the coming daily cycle low if conditions call for it. But then I have big profits from the recent run so I can afford to stick with my plan.

    If you didn’t get in at the July bottom like I did and you are in jeopardy of losing all your profits you might want to consider at least booking some profits if 78.36 is broken.

  11. Shalom Bernanke

    No fear, sweet babies. Whether we take a breather for a week or two (likely), or ricochet out of this decline, I believe this is the meat of the move lower as far as price is concerned. We’re working off the overbought, and that can continue even with sideways action after today.

    In short, I like some prices here, but I don’t expect them to start tacking on 5%/day again for a little while.

    Everything is OK. πŸ™‚

  12. Gary

    Sandy,
    I will definitely trim. Probably back to 50%. I want plenty of dry powder to put to work at the bottom of an intermediate cycle.

  13. pimaCanyon

    So, Gary, you are saying that we will see a daily cycle low, followed by a bounce, then a move down into the intermediate cycle low, right? Two different lows, the second lower than the first.

  14. alex

    that downtrend line on the dollar chart to this report doesnt seem right. Couldnt it have been drawn against the top of oct 20 high too?

    Or when you go back to HGHS of Dollar in June and draw acroos the top of HIGHS in SEPTEMBER , the real downtrendline lines up with the 50 dma…near 78.80

  15. Razvan

    its been a terrible couple of days guys… i am not happy at all about this action. We cant make a lot of money with this kind of bs.

  16. Gary

    Rav,
    You should have already made a ton of money. No market goes stright up forever.

    Eventually there is always an intermediate correction. The key is to buy the bottom of that correction. That’s what I did in July and what I will attempt to do again if this turns out to be an intermediate decline.

  17. Gary

    I can’t tell you were your core position should be. Only you know that. It should be something you can ride through an intermediate correction and not get knocked out at the bottom.

  18. Razvan

    i am still up a respectable 200% since july but i dont even want to think about where i was 3 days ago. A good thing i did when i was more profitable was to take some of the money out and convert to physical.

  19. Chrys

    Gary – if on this forthcoming bounce what if it exceeds the recent highs? Would that mean the intermediate top wasn’t in yet?

  20. thedocument

    Todd,

    My personal guidelines for buying and selling, generally-speaking, are as follows: buy when the market provides a high-probability entry; sell to protect capital. Note that the decision to sell has absolutely nothing to do with the entry price. Once you are in, your job becomes to protect your account. You ride the cycle up to the point where the odds swing against you, and the exit is done based on market conditions, not your entry price.

    There is certainly a mental/emotional part of this work which depends on your entry price… a trader can follow his rules more easily when sitting on big gains… but ultimately discipline is an emotional game, and learning to ignore the entry price will help keep those emotions under control.

  21. pimaCanyon

    Thanks, Gary!

    Hey, for a “retired” guy you are working pretty hard at this new job you created, eh? We subs definitely appreciate it! Maybe this sitting around answering all these questions is good therapy for the back, but when it’s healed up, those rocks will be calling your name.

  22. Nintendo78

    Just found this posted last night by Harvey Organ, the guy who testified at the CFTC in March.

    ‘Dear Sirs

    I am now deeply concerned that a default may occur in silver in December. We have witnessed a huge number of options exercised for the physical metal in November. With the exponential gain in the silver price one can just imagine how many will stand in December. Many customers are fleeing the registered vaults..fearful of a default.

    Please act to prevent a cataclysmic event occurring at the silver and gold comex.

    I thank you for your kind attention and I also thank you for inviting me to testify in front of you. I hope that the CFTC heard our message.

    Harvey Organ

    http://harveyorgan.blogspot.com/

  23. DG

    Just shorted 1000 XLE at 62.91 to add to SPY and SMH. Stop is at the high at 63.26, so nice and close. Market looks very vulnerable to me, and i like hedging my PM’s.

  24. DG

    Doc: agreed generally about entry prices being irrelevant as the market has no memory, but I like to use entry price as a stop regardless of market conditions. Once I buy something and it gets into the black I generally set a mental stop at cost to prevent a position from getting into the red. If I have gone from black to red maybe something has changed that I have missed.

  25. Gary

    We do have a four day corollary in effect for stocks. If we get a down day today and tomorrow we will have a 4 day rule possible trend change. The lack of SoS prevents me from selling short though and of course I would never short PM.

  26. TZ (7006)

    GARY,

    What are the top three things that require the most time or are the most trouble for you writing this blog? I’d like to help with some suggestions if possible cause there is no reason this should be too hard on your part.

    Billing?
    Emailing passwords?
    Composing the nightly page?
    Incoming emails?

  27. Gary

    Everything got lots of volume yesterday. The only way to know is to wait for confirmation. That means a failed daily cycle.

    Right now you are just wasting your time trying to guess whats going to happen.

  28. DG

    Agreed on OIH Gary, and I usually do that one, but XLE is showing more overbought than OIH the way I look at. And I always have lots of cash. If I want a bigger percentage move I just do more of the less volatile item. For example I have twice as much SLV as I would have AGQ and with interest rates at less than 1% I don’t mind spending more capital as the cash just sits around anyway. Thanks for the thought and point though—appreciated. And there goes XLE…

  29. Gary

    wrinting the nightly report emailing it and then having to do it all again on the website is #1.

    #2 is trying to respond to email questions and questions on the blog.

    Billing and filing is a distant third unless it happens to be a day I run a special and I get flooded with new subs. I usually try to initiate those on Sunday when I’m not doing anything anyway so that’s not a big deal.

    This has gotten to the point where I don’t feel like I can take a climbing trip anymore. I certainly can’t do it and get out the reports via email. In order for me to take any kind of trip the reports have to be website only.

  30. Redwine

    Gary,

    What are your thoughts concerning diversifying into physical PM at any point during this secular bull run? I’m thinking of increasingly diverting stock profits into metals as we go along. Thank you.

  31. alex

    Hope no one sold their EXK during that pullback. They had great earnings report this morning and were up ( at one point) 17% for the day.

    Slight pullback intraday now…may add to position if a large flag appears here (for long term)…already own a lot from the doublebottom cup/handle breakout in Sept/oct

  32. TZ (7006)

    GARY,

    OK, #1. Your reports are the same text and graphics. Why are they written twice? What are you writing each report with (or how?) and which is slower/faster?

    #2 Do you have a smartphone which would give you easy ability to read and respond to the simple text comments on the blog during the day – *regardless* of location. (Note that having you here during days is nice for us, but by no means required. It is your life. During times like this of extreme action, though, the gesture is appreaciated.)

    #2(part 2) what system do you have to handle incoming emails? Do you just use POP and something like outlook express to receive incoming cox emails? Do you use a webmail interface from cox (which probably is crap)?

  33. Redwine

    Gary…..I was thinking more along the lines of converting to physicals mainly near the end of the run. Do you think there will ever be a place for physicals during the bull market?

  34. TZ (7006)

    Your report SHOULD involve:

    1) a standard set of stockcharts bookmarks. You review each night, choose those of discussion interest, annotate, then

    2) write text.

    3) insert stockcharts interspersed to the text.

    correct?
    (Still want to know how you are writing reports twice and what you are using – particularly to insert/link the images.)

  35. TZ (7006)

    MISSED QUESTION:

    I’m also inferring a certain tech level from you (reasonably good). Am I off? No insult if so, just need to know.

    Do you know HTML? Would you know how to use a smartphone? Does asking if you use “POP” email throw you? etc.

    Give me some grounding of your level.

  36. Gary

    I write the orginal report as an email then I have to copy and paste it into the website.

    No smart phone. I wouldn’t use it anyway. When I’m out climbing or working out I’m not going to be responding to questions.

    I’m not a short term trader so to me all these constant freakouts just seem senseless but I understand how most people are severaly allergic to any kind of drawdown and need guidance to stay focused. So I do the best I can but it’s already taking up a lot of time and it’s only going to get worse as the subscriber base grows.

    I’m sure there will come a time when I simply won’t be able to respond to emails any longer.

  37. TZ (7006)

    One more,

    I know how many posts are on this board, but how many emails are you managing each day. Emails can QUICKLY grow to become laborious. In today’s society overload of info is easy problem to get into.

    How many emails?
    AND (even more important)
    How many times do emails result in a further back and forth discussion and not just a simple reply?

  38. oa92000

    ” DG said…
    Just shorted 1000 XLE at 62.91 to add to SPY and SMH. Stop is at the high at 63.26, so nice and close. Market looks very vulnerable to me, and i like hedging my PM’s.”

    DG do you ERY & SDS or other methods?

  39. Sandy

    Gary,

    Based on history, how much price correction from the peak do you estimate in gold price at intermediate bottom.

    I understand that I am putting you on a spot but even a rough estimate from you will help.

    Thanks.

  40. Gary

    I’m not very tech savvy and I’m a pretty slow typer.

    Right now with the reports on the website only this is about as good as it can get for me. And I can update the site from anywhere.

    That’s just not possible with email alerts anymore.

  41. TZ (7006)

    >I’m not a short term trader so to me all these constant freakouts just seem senseless but I understand how most people are severaly allergic to any kind of drawdown and need guidance to stay focused

    You have to know when to say ‘no’ or stay silent about random questions. Let others on the board chime in and answer as best they can. You don’t have to tackle everything. Being nice and having a service means you want to, I understand. But that isn’t necessary and you shouldn’t be unhappy.

    People will take anything they can get for free (and often don’t appreciate it). It’s humanity. It is clear to me (and you) when there is a serious question on the board – like when something you said is ambiguous Vs. when somebody asks how a “stop” works, etc. Gotta let them do their own work.

    And even crazier are the people doing things like bitching over $10 or not reading you cause it doesn’t come as a PDF. Are you serious?!? Guys have posted stuff like “I’m thinking about subscribing for a month.” Really? My gosh, how little money do you have for good information?

    If a book could make you $1mil, I’d be willing to buy it for a few hundred thousand. It seems others wouldn’t pay over $9.95. And only if you sent it in PDF. I’d read it if it was printed on toilet paper.

  42. pimaCanyon

    FWIW, even though Gary’s nightly update subscription is probably the best bargain on the planet, I took a while to bite. Why? Because I had already looked at many other paid services, some of which I’d subscribed to, and none seemed to offer the edge I was looking for. So I dragged my feet about subscribing to Gary’s service.

    It was reading the comments on this blog (Gary’s responses to questions and the occasional sub’s glowing recommendation) that convinced to me subscribe.

    I’m guessing that there may be other subs who read the blog and comments for a while first before subscribing.

    So, Gary, your responses here in the comments section serve a dual purpose. They answer the question and they also help bring in new subs.

    At some point you may decide you have enough subs and stop answering emails and questions in the comments section, but until then, your efforts are not wasted.

  43. DG

    Gary: You have done and are doing a great service for a lot of people. but you’re a person too, for gosh sakes. Don’t drain yourself dry. Decide what you are happy doing and do just that much. I agree completely with TZ: answer substantive questions that you feel like answering. Perhaps you need to exercise the same level of discipline on the site that you do with your investing! On top of for you, selfishly I’d like to see you run this game for a good while and not burn out over the next year or so.

  44. TZ (7006)

    Crap, I had a long post Gary to help and just managed to delete it with bad key press.

    Hold those thoughts and I will throw out some ways to address your issues.

    PS: when you say you “write the report as an email”…using what program? Outlook express? A webmail page?

  45. TZ (7006)

    Gary,

    What you are dealing with is a very typical scaling issue. You have grown to certain hard limits of your time/desire and need to reconfigure a bit.

    You are doing a few things clearly which are causing the problems. I’ll point them out in a bit. You can prob kill 80% of your probs with a 20% change in a few things (simply).

  46. Gary

    carlos,

    Well gold shouldn’t break below the last intermediate low at $1155.

    I seriously doubt it will be able to move below $1265 and I wouldn’t even give good odds for a move below $1300.

  47. Jayhawk91

    Gary-
    Do you have a tech savvy friend who can handle this stuff for you?

    Maybe send him or her the report and let them send it to the subs? Doc and the Aden Sisters just send out an email when a new post or alert is up. (Maybe the amount of information & charts you are attempting to email causes things to shut down?) So a basic email alert to the subs might be easier saying “new report”, etc.

    I’m not bothered by checking the site at all, btw…Maybe the folks on the blog can keep everyone informed with a “new members report up” comment on the regular blog.

  48. Onlooker

    I will heartily echo the comments from TZ and DG regarding Gary’s time and effort. From some of the questions that show up in the comments here, I can only imagine the questions he gets in emails from subscribers. I don’t think I’d have the patience he displays.

    Some people should spend some more time reviewing his writings, thinking about what he’s saying, and taking responsibility for their own trading/investing moves.

    He lays it out quite clearly (with few exceptions) and it’s really quite straightforward and relatively simple. But people continually ignore it and/or make it more complicated than it needs to be.

    Bottom line: I appreciate how much Gary does for the modest fee, and feel that he shouldn’t get too bogged down with it. But he has to decide where the limits are, and he’s clearly capable of doing that.

    Thanks Gary, you’ve made a world of difference in my investing/trading.

  49. Jayhawk91

    Gary-

    You should add a frequently asked questions page on the member’s site. Just let everyone know form now on you can’t respond to every question. Maybe set up an automatic reply email with “Due to the volume of questions I’ve been getting, I regret I will no longer be able to answer each question personally. Please visit the members site and view the “frequent asked questions” link. Thank you!”

  50. TZ (7006)

    GARY,

    OK, thanks.
    I mostly have enough to go on. Your problems solved soon. Give me time to write response.

    QUESTION: you MAKE and SEND the email with outlook, but you also RECEIVE and MANAGE the incoming emails with outlook too, right? No webmail interfaces, correct?

  51. DG

    Weird! If the Dow can close down just a little (say 15 or less) I will get a buy signal! The buys are damn good so I’d heed them. Especially if we get that big BoW number. Man am I being mentally whipsawed! Oh well—you do what the market tells you to do. the buy is good far an immediate 1% move. I will post near the close if I get it.

  52. TZ (7006)

    GARY,

    Your email address is ‘in the clear’ on your home page. This is usually a bad practice since web harvesting programs will pick it up automatically and spam you.

    If you just have Outlook with a simple “POP” account (which is what you are describing so far; dont’ worry about the lingo), then you must be getting a lot of spam.

    True?
    How is this being handled?
    Are you just picking them out by sight alone and deleting?

    (Again..easy ways to handle all this. Just need a bit more info)

  53. Gary

    True and I get some spam. Not that much really and I just mark it as junk and it usually gets directed to the junk file after that. Elliot wave quickly found it’s way int the junk file πŸ™‚

  54. pimaCanyon

    DG, thanks for your signal alert. Keep us posted!

    The BoW numbers look like we have more upside in store. EW also wants another wave up by most counts, so as long as the BoW number continues to be high, going long today looks like a low risk trade.

  55. TZ (7006)

    GARY,

    Your blog is called “smart money tracker”. Is that a key name for you or is it just a ‘good enough’ name you picked out to run with?

    How attached or strong was the “Smart money tracker” creation?

  56. TZ (7006)

    How come you have never used your smartmoneytrackerpremium.net domain to set up an email instead of using cox? Doing that would allow a permanent email (should you move or leave cox) and also allow redirection to any email service you want at any time.

    Do you not know the process to do this or just didn’t want to?

  57. Jayhawk91

    Shoot, go on a hike and stop answering TZ’s questions!

    Maybe you don’t need to do nightly reports if nothing is happening? Perhaps a 2-3 times per week deal and an extended weekend report.

  58. Razvan

    this is nothing but another whipsaw similar to the 10am shakeout before the fed meeting perpetrated by a bunch of thieves doing their random raids. It managed to shake me out of a monster position for the second time but it will not stop me from trying again. In typical fashion, tomorrow we will probably be at $1440

  59. Sandy

    Gary,

    A very easy option for sending bulk emails is through service like constantcontact.com or netatlantic. These sites charge app. 20-30 $ per month for sending bulk emails out on daily basis and you can create an email database in seconds (just import your existing database). Very easy to manage on everyday basis.

    We have been using these services for many years for our email campaigns. Work like a charm.

  60. Poly

    I’m encouraged by the recent action in the miners. The volume has been extraordinary (past 2 weeks) and the $HUI has clearly decoupled from the equity index and even to SOME extent the underlying bullion price. I’ve seen days where bullion was down but the HUI was up, this morning was an example.

    There could be a number of theories, but I would suggest, now that HUI has broken out, it’s being recognized as clearly undervalued in relation to the metal. It begs the question whether reducing any core miner positions in preparation of a coming intermediate dip is warranted. I understand reducing leverage.

  61. TZ (7006)

    JAY,

    >Shoot, go on a hike and stop answering TZ’s questions!

    I’m trying to help and my questions are pretty much done. Thanks for the understanding and patience.

    If Gary said “screw it, it’s not worth it” and walked away I think we’d all regret not trying to help improve things. He can probably deliver almost the entire service he has in all ways with just some small changes. But without knowing the situation specifics it is hard for those of us with some tech background to help out. The questions were necessary.

    He can take whatever advice I give or not, but I’m happy to put in a bit of time and suggest some improvements.

  62. Gary

    Right now with the current system as is, everything works perfect. The only clich would be if Cox prevented me from sending out the password on Sunday.

  63. Jayhawk91

    SAN FRANCISCO (MarketWatch) — Silver surged to a record volume on Wednesday, as 201,216 futures contracts changed hands, the CME Group said in a press release. That handily beat the previous record of 127,890 contracts set Dec. 30, 1976. Silver tanked more than 7% on Wednesday after the CME, which owns Comex, raised margin requirements for silver futures. The December contract settled at $26.87 an ounce on the Comex division of the New York Mercantile Exchange.

  64. DG

    C’mon guys…Gary has explained this 100 times. Think of what “buying on weakness” means. You can’t have “buying on weakness” unless there is weakness! If the SPY is up on the day the weakness is gone so it “disappears.”

  65. Frank

    TZ,

    I have been making the same suggestions (mostly) to Gary via private email.

    He prefers to stick with an Outlook platform so the best solution is to set up his own domain that allows bulk email. I have offered to provide step-by-step instructions.

    An important thing is that the hosting provider needs to provide a custom port number (not 25) for POP mail. (I suppose that IMAP would not be a problem). Cox and other ISPs block port 25 in order to try to force you to use their outgoing mail server.

    The simple matter of sending a weekly password is going to become a nightmare if the subscribers increase and Cox could tighten their anti-spam policies with a drop of a dime. Verizon shuts you down for 24 hours for a “violation”.

  66. pimaCanyon

    okay, DG, then I am not interpreting the BoW and SoS lists correctly. I originally thought it meant what you’re implying it means. But yesterday we some comments about it and now I understand it to mean that BoW means buying on a downtick, NOT down for the day. So I’m confused, which is it, buying on a downtick or buying when the stock/etf is down for the day??

  67. Gary

    It’s calculated by whether the bid or ask is being hit. But the signals ony occur when the market is down for BoW and vice versa for SoS.

  68. pimaCanyon

    looked at the SoS and BoW lists again, and you’re right, DG, the only stocks that are appearing on SoS are stocks that are up on the DAY. Vice versa BoW.

    So I’m back to square one on how useful this data really is. Big money could still be piling into SPY, but it’s not going to show up on EITHER list because it’s up on the DAY, even though big money is buying it on downticks.

  69. Gary

    Here’s how you use it. Go back and look at every intermediate top. Then go through the data on up days. You will find that at everyone of them there was SoS days prior to the top.

    You will also notice it isn’t a perfect timing tool, but it is an excellent warning device.

  70. David Kafrick

    Gary,

    How come you use cycle analysis on the Dollar Index? I ask this because cycles are a reflection of investors/traders sentiments, but the Dollar Index is not a heavily traded market. If you take the Euro/Dollar FX (which is traded on CME and Forex) it is infinitely more liquid than the Dollar Index. Maybe, what I´m trying to say, is that the Dollar Index moves because of investors/traders who buy and sell EURUSD, GBPUSD, USDJPY, AUDUSD… and not the other way around. Therefore, shouldn´t you use cycles to analyse the sentiment of these markets instead of analysing the Dollar Index?

    Not sure if I made myself clear, but thanks anyway

  71. Onlooker

    Could end up being an exhaustion candle for the dollar today. Bottom line is that we still need to watch the marks that Gary has pointed out. Trying to get ahead of them, anticipating the move, can just end up leaving you whipsawed.

    Of course you may get lucky, or have exceptional market instincts, but most will just act emotionally and get torn to pieces. Been there, done that myself.

    Gold is approaching it’s all time high again. It might just be that the silver trade got too extended (which it certainly was), with way too many people leaning on one side of the boat. And it capsized.

    How many people do you suppose were selling gold and loading up on silver, chasing the outperformance of the last couple of months? I think we saw some evidence of that here.

  72. n1tro

    tried to buy some physical silver from scotiamocatta (bullion bank in canada) today…they are physically out of 10 oz and 100 oz silver bars!

  73. DG

    Pima: The other thing is that it is only useful for SPY. You may as well stop driving yourself crazy looking at the other stocks. the reason is that SPY is used in order to hedge against a general market decline; nothing else is. It’s a proxy for the whole market. Gary has studies other stocks and found nothing useful so don ;t get distracted by other stocks. If SPY is there fine. Otherwise just close the page.
    And Gary—for the purpose of letting you off the hook to go climbing, let others answer stuff like this—unless we blow the answer. πŸ™‚

  74. n1tro

    Dont know if this is widespread, but got off the phone with CIBC to buy some physical silver and they said not a problem giving me a certificate. When I asked to take delivery, they said they can’t gurantee getting any bars. Guess Canadians having been loading up. Guess I’m going to suck it up and pay the premium for silver maples. πŸ™

  75. DG

    Damn, this buy signal is gonna be close. If we are down 12 or less on the Dow assume we get it. It’s 80% accurate for the past 30 years and means an immediate (within five days) up move. I will cover all my shorts and buy a lot of SPY if we get it. And metals? Wes—haven’t heard from you in a while. You still out there?

  76. DG

    Nope, no signal. Kind of like BoW, you need to be down to register. It is designed to get good entry points (a new recent low for buys or new recent high for sells) so an up day can’t be a low, thus no buy signal. I play with very tight stops so entry points are crucial for me. Seems to me “close but no cigar” works better than random but I have never studied it, so hesitate to make a claim.

  77. alex

    even if these stocks ( EXK , HL , ETC) go sideways like this , its just forming a huge flag for the next move up πŸ™‚

    can you say Dollar 74
    Gold 1600

    the way we used to

  78. DG

    Damn! I really wanted that signal. Each one is worth some thousands$ to me. Also nice to know what the heck to expect at least for a few days. Oh well.

  79. n1tro

    I’m in Canada so there is a surcharge. And they also ship via UPS so huge brokerage fees. Buying with the banks, they give you bars with their stamp on it and it would be easy to cash out when needed. Hopefully silver will go sideways for 2 weeks so I can buy some more.

  80. Jayhawk91

    Raz-
    I agree, something big is about to break on silver. Global pressures all coming to a head, they are throwing the kitchen sink at this thing. Intermediate cycle or not, I don’t think now is the time to be off the silver bullet. Also, let’s not forget the summer intermediate bottom was extremely mild so even if we hit one sideways correction may be the game plan.

  81. Jayhawk91

    Silver miners got destroyed yesterday and todays snap back rally was a response to that. Also EXK and Slw had monster days. Yesterday SLV was rocking and SIL was just sitting there. Who knows??!!

  82. pimaCanyon

    DG, I have to study the SoS, BoW thing a little more. I’m now wondering whether you’d do just as well to look at volume alone, as in climactic volume.

    I know Gary has said the other stocks/etf’s are not useful, but was it just a coincidence that GLD was at the top of the SoS list at its recent high and then dropped hard? I’d like to go back and look at daily and IT tops in gold and see if GLD shows up on the SoS list for two or three days leading into the top.

  83. Uatatoka

    Lightened up today given the $ strength and will remain so until the $ rolls over again. I wasn’t in since July so I don’t have the cushion Gary has or I’d wait for further confirmation.

    Implied volatility for metals is very high right now, especially for silver. Might be worthwhile to sell some SLV calls if we have a few weeks of sideways or further selling to take advantage of the premiums and generate cash going into a possible intermediate low.

    Then again maybe not with crazy Bernanke working overtime at the presses…(no offense Shalom)

  84. Dean

    I lightened up today and yesterday as well as I didn’t get in during the July lows either. However, lightening up just means reducing position sizes to 25-50% from 100-150%.

    HZU, which is the Canadian equiv of AGQ is a screamer and I don’t like holding it during sideways action (chop).

    I use TD and BMO and I prefer BMO. Waiting for thinkorswim to re-open then I will move all accounts there.

  85. coolkevs

    Demark voodoo told me that we would see a dollar rally. Expect another 2-4 weeks upside, then resume the dollar “collapse” – 72.5 here we come! I also saw yesterday that Gold records a YEARLY 13-sell signal this year, which would imply 12 years of bad luck. Silver on the other hand, is about to reach a YEARLY sell setup, which would imply 1-4 years of bad luck. Silver is a much better thing to be bullish on than gold as Gary has detailed here. BTW, a YEARLY sell signal recorded in 1999 for the S&P (12 years of bad luck) and we are emerging from that next year – I would say that has been pretty accurate. Who knows – just throwing out a different look at things.

  86. Gary

    I think you can throw out all your indicators right now. The dollar is waiting on the G-20 meeting. That will decide whether the rally continues or the collapse resumes.

  87. Daniel

    Gary–
    RE: G20
    obviously anything can happen— but wouldn’t you put greater odds on nothing really changing and actual actions will not follow the Lip Service provided (like the U.S. actually wanting a strong dollar)and dollar will continue falling as the Federal Reserve wants?

  88. DG

    Gary: I agree that the dollar is clearly king of the hill and that other things will follow its tune. However I wouldn’t quite throw everything else out. It’s funny how the various markets are usually synched together. “Coincidences” happen where something external happens just at the right time to have some reliable indicator or other proven right. I believe, for a number of reasons, stocks are due to fall. So maybe the dollar rallies to cause that. Sometimes it’s almost hard to tell what’s the cause and what’s the effect. I have been shorting for a few days based on how overdone we are to the upside and, what do you know, CSCO announces lousy earning and tanks overnight. I’m hoping for a “both sides” day tomorrow: up PM’s and down stocks.

  89. Daniel

    By the way everyone.
    I now receive a text to my cell from twitter telling me Gary has posted the new daily update.
    this will work very well for me!!
    Just wanted to let everyone know it worked and is convenient for me!

  90. Poly

    Guys, the FED will start buying as part of QE2 this coming Friday and will buy for 18 straight days for a total of $110B.

    G20 meetings have a history of producing nothing.

    Just saying….

  91. DG

    Yes, I’m just saying that while some overbought-type indicators are not going to work as well in a roaring bull (or during a collapsing dollar) “throwing everything else out” is a little extreme because everything tends to dovetail together.

  92. Nick

    One possible thing to consider for Stocks: Rise out of August bottom, midpoint consolidation over past 2-3 weeks and a similar rise above today’s level, possibly till year end? I know stocks are way over done, but then again, so are Gold and Silver. Not sure how the metals will react, but given the POMO days lined up, looks like we may continue higher in the SPX.

  93. DG

    Yeah this POMO thing is annoying. I’m really not big on “manipulation” nonsense, but a few trillion here and a few trillion there really can influence things. Makes me careful not to hang on to shorts too long unless I really get some room. Good patient entries and tight stops for me!

  94. Elk2Go

    Has anyone else had problems getting Gary’s Twitter notice via email forwarding? I’ve checked my spam file along with whitelisting twitter in my server too. Also see others in Twitter having the same problems as well.

  95. catbird

    Consider: What are the odds we get another sell-off as nasty as Tuesday in the coming days in a market as fundamentally strong as the PMs?

    I have to think slim. Tuesday was so violent, so dramatic, I think it terrified a heckuva lot of weak hands. The volume was just out of this world. When we are emotional, in the aftermath of a horror show like Tuesday afternoon, our fear tells us “Well, there must be another one comin’ right around the corner.”

    But what are the odds of that? For example: Gary is always saying, the odds of another October ’08 style market crash happening in the near future are next to nil simply because a century of history shows us that bona fide crashes are so rare.

    Which brings me to this: I’m not a chartist by any stretch, but just from eyeballing the gold chart Gary included in tonight’s report, here’s a thought: what if gold drifts slowly downward for 4-5 more days? That would form…a bull flag.

    A bull flag that hopefully bottoms in the middle of next week, followed by a spike upward (which would naturally bring silver up with it). I’d love to see higher prices until at least the first week of December.

    Just basing this on a hunch (and wishful thinking) so take with several giant grains of salt. (I don’t know what I’m talking about.) If we get another violent downdraft on MASSIVE volume akin to what we saw Tuesday afternoon, well, that pretty much nukes this idea.

    p.s. — All my money is in AGQ, which I have sold none of in spite of the last 48 hours.

    p.p.s. — These G-20 meetings seem to me to be meaningless Kabuki shows. It’s difficult to imagine Ben going in there and saying something surprising, like telling the world “Yeah, maybe I’m being too aggressive with QE2…” Why would he say something that could depress his precious S&P 500?

  96. Uatatoka

    No problem getting the texts from twitter both yesterday and today. Be sure to set it up in your twitter account to have Gary’s tweets sent to your phone (you have to send a verification text to verify the cell #).

    I don’t use Tweetymail.

  97. aviat72

    Gold action was much stronger compared to Silver today. Silver is having a hard time staying above 27.30. Gold on the other hand rallied strongly making higher highs, while silver was stuck below that 27.30 level.

    CSCO’s miss (10% of revenue) has stocks down. Given how over stretched we are, this should lead to a correction. But we have Ben and his POMO billions ready to be pumped in next week.

  98. Wes

    DG,

    I’m wasting time perfecting the 200 share QLD trade for lunch money while waiting for whatever you guys say is going to be the next big happening.

  99. MLMT

    Today intra-day dollar reversed at 78.34. Why didnt they go up to 78.36. Tomorrow (Thursday) by 9:30am (US cash open) dollar will be over 78.36. Watch the drama unfold as night progresses.

  100. Steven

    For those who pay attention to embedded status, silver is close to embedding again. It will take another day or two to be sure it embeds but then the theory says that it will move from overbought to locking in the trend which in this case is higher. It was, fwiw, embedded during most of the move these past couple of months. As with all tools not perfect but also not usual to see something embed so it’s worth watching imo.

  101. TZ (7006)

    I have reviewed stuff and now believe there is an excellent chance the metals resume surging up higher in the next 2-4 days. This is obviously not guaranteed.

    I have planned out a trade to re-enter on certain parameters.
    Again, this will be with silver and gold futures, leveraged, and with very tight stops.

    There is no guarantee my entry will be during US market hours since gold/silver trade continuous.

    Just an FYI on my opinion right now (as of the last few hours upon reflection.)

  102. Onlooker

    MLMT

    For the record, the dollar actually got up to 78.17, not 78.34. We’ll see if your prediction comes true or not. So far, as of this writing, it’s still in question, though I realize that the action can get much more interesting as we approach U.S. market opening.

    We’re really in limbo here and could still break either way. Trying to anticipate a trend change is always perilous. Better to use the guidelines that Gary has laid out, IMO.

  103. Movax

    USD rally is pretty subdued in most currencies. (Look at CAD, AUD, CHF) It is a result of euro weakness like in the summer. If so last time gold outperformed. It wasn’t that long ago, ppl haven’t forgot already.Any transition from gold to USD may be backstopped and reversed by fears of the euro going down again.

  104. Steven

    Gary,

    Can you see the situation in which the PMs go higher in conjunction with a rising dollar (as they have been doing)? There is some thought that the broader stock market rising has actually made it harder for PMs to outperform since there is so much action elsewhere. I know the PMs have had much history in rising with a falling stock market and also with a rising dollar although I’m not sure if both happened at the same time. In fact could it be that IF this happens it puts the spotlight on the PMs even more? I suppose it depends partly on why the dollar is rising. It seems to be due to some Euro concerns. I also have my doubts that the G20 meeting with resolve anything and this just could renew the dollar downtrend but who knows. Just a thought.

  105. alex

    Gary or anyone

    This isnt a cycles question, but I was just curious…

    are any markets affected by Veterans day (closed)?? and if so, will that in any way affect other markets trade today ( more or less volatility or liquidity?)

  106. Razvan

    we have to wait for the G20 puppet show to finish before we can go higher. I was watching the press conference last night and these guys cant even come to agreement on beef import but people expect them to agree on currency movements. This puppy is far from over. Higher prices to come

  107. DG

    Gary: what if the $ rallies above 78.36 AND gold rallies above $1424.40? If the euro craters both are distinctly possible. I guess you sit tight because the gold daily cycle is still intact? Might you sell into strength if the $ has clearly made an intermediate low by crossing 78.36?

  108. Gary

    For me to sell I would have to be convinced that gold was or is going to enter an intermeidate decline. The only sure fire method to recognize that would be for a daily cycle low to be violated.

    So that would be a tough one.

    If gold ignored the dollar rally then I would probably just put a stop below the next cycle low and let my positions ride.

  109. Jesse

    Doc said…

    “Hey Gary, if you’re overloaded, feel free to send some subscribers my way ;-)”

    Hey Doc,

    Maybe you need to getting a marketing partner, seems to be helping Gary’s sub base grow. I have a suggestion for you. Periodically come on to Gary’s blog during heavy traffic times at tops or bottoms, maybe with a guest blog or a link to your blog (like that superb Nov. 9 blog post), with the following enticment.

    “One day only, SMT sub’s get a $50 discount on a 1 year subscription. Just send this week’s password in an email for the discount”.

    I suspect you could easily get Gary’s approval if you toss him a few burrito’s, or better yet, let him win a few burrito bets. πŸ™‚

  110. DG

    Gary’s subscriber base is growing because he has been hot (I have told a few friends about him myself). Doc, all you have to do is make a whole bunch of great calls in a row and you’re base will grow like weeds. Good luck! Then you get to blow a few calls and watch it shrink. Frankly, I’m glad I don’t do this for a living any more!

  111. alex

    Anyone ever heard of Jesse Livermores “shakeout plus 3′ ??

    He says on a double bottom pattern , Like the dollar now , the second low is the shakeout, then add (10%) to that low. If the price gets there , there is real interest on that 10% move and it creates a buy point..

    I think its called shakeout plus 3…because he shows it in a $30.00 stock , the plus 3 was $3 off the 430.00 low…..or…..10%

    that would make Garys call correct I believe, if I have that straight.

    correct me if you have heard of that Livermore approach and I used it wrong.

  112. DG

    Nice! Stocks smacked and PM’s up. I am holding my stock shorts for now—a little nervously, admittedly, because of this damn POMO stuff, but I am “strong hands” now unless we get a little panic for me to cover into. Go euro!

  113. Poly

    Dollar doesn’t seem to have any steam to it and appears to be a Euro trade that about the dollar. It to will pass and the dollar will be left out to dry. We may get our equity sell off after all, without much dollar assistance which could satisfy all 3? (Dollar & gold within cycle and equities forming a low)

  114. Shalom Bernanke

    I’m not concerned about the USD in the least. If it starts to puke again, the metals will rise.

    It the USD goes higher, metals will either pullback (oppty to add), hang steady (no problem with some sideways action), or possibly even go higher along with the USD as a flight to safety.

    All good outcomes, because everything is OK.

  115. DG

    Razvan: I hope I am not crossing the line here, and you may already be a much better trader than I am, but it really seems to me that you need to keep your emotions in check. Recently over-leveraged, now worrying about a few pips in the euro. Make sure you’re not just gambling for the thrill. This is not an easy game and it is designed to get you emotional so you’ll do the wrong thing. Success is unlikely unless you can watch what is happening at least somewhat dispassionately (at least when the market is open). If what i have said is helpful, great. If not, just ignore me.

  116. n1tro

    500 pips is not something small…thats 5 cents out. 1 mini lot on the forex means $500 down…you can do the math for what his unrealized losses are using leverage

  117. Razvan

    i am not trading currencies guys.Currently 100% in commodities. I am watching it for its correlation to the DXY. When the fall reaches the end then we can look for higher metal prices.

  118. Mary

    Good morning Gary,
    Got me glued to the monitor watching the US dollar index since we no longer get intraday alerts via email. Also, this is a first to find and post on your blog. I’m happy that your subscribers have increased, but sharing you stinks with these growing pains. : ) MLF

  119. Gary

    Good morning to you to Fergie.

    It’s about time. I was feeling kind of lonely since you post over at Slope but never here.

    You’re forgiven now πŸ™‚

  120. Gary

    BTW after spending several hours pondering this mess I think I may have figured out what’s going on. It’ll be in tonight’s report…

  121. Mary

    Well you fixed that by forcing me to pay attention and get off autopilot. Next time I see you, I’ll make you try sushi just to see how you like that. : ) Slope isn’t a warm and fuzzy place for the precious metal crowd so I’ve been an infrequent visitor. Blogging from an iPhone isn’t easy you now.

  122. Gary

    I’m sure you are vacationing in Napa vally or shopping in the Big Apple or Paris so I don’t feel real bad for you πŸ˜‰

  123. Mary

    Guilty as charged. Just some of the perks of being a longtime precious metal nut case as Tim would say. Wish I could squeeze in your Hawaii boondoogle!

  124. Gary

    Yeah that’s too bad. I think we are going to have a lot of fun.

    And you know I’m going to be rubbing it in that week as we sit on the beach while the rest of you are watching the snow come down.

  125. Mary

    May your Mahi Mahi be blackened beyond recognition for being so cruel as to mock the non-attendees. Yes, I can’t wait to read those reports from Hawaii. I’m sure it’ll read more like Travel & Leisure than Smart Money.

  126. Jayhawk91

    I can see it now…A buff 50 year old Gary with a chicken burrito stuffed in his face on the beach while I shovel 18 inches of snow off my Colorado driveway.

  127. Elk2Go

    Does anyone have thoughts on Denison Mines Corp. (DNN) which is engaged in uranium mining. I’ve been hearing a lot about the future of uranium lately.

  128. aviat72

    We estimate there is around Eur 2 trillion of debt issued by public and private
    sector institutions from Greece, Spain and Portugal held by financial institutions
    outside of these countries. This is the equivalent of 22% of euro area GDP and is
    well above most widely quoted estimates.

    The size of financial institutions’ exposure to these 3 countries argues in favour of
    intervention so as to avoid a repeat of a complete collapse in confidence.

    The ECB will need to step up considerably its purchase programme especially
    on the private asset side.

    From an RBS note today.

    So the DX might rise as the Euro falls. However competitive devaluation is alive and kicking.

  129. Mary

    Yes, we’re all becoming accustomed to those curve balls. I wouldn’t be surprised if we see another run up on silver to set new high tomorrow or Monday, maybe $30, before declining.

  130. DG

    Man, I can’t get any stock chatter going here. I guess I’m on the wrong blog (except that I am long a lot of PM stuff)

    And, good luck TZ! It’s all about the right entry and tight stops…

  131. pimaCanyon

    interesting morning. DX has broken the line in the sand and is trading near its high of 78.40.

    But gold has retraced more than 78 percent of its recent move down (this happened during the overnight session). That’s a very deep retracement for gold –IF– its trend is now down.

    So we have conflicting messages: dollar broke the line in the sane, but gold retraced deeper than you’d expect if the IT top was made on 11/9 at 1424.

  132. alex

    If you look at the UUP , you get volume analysis ( which I value alot).

    The last time UUP was running up here , it was on `15 million ( measures buying demand)

    today its only 1.8 million 1/2 day…so could be 4 million at best.

    Dollar rally running out of steam I.M.O.

  133. TZ (7006)

    I’ve got good money invested in this play. I worked on the trade setup for hours last night.

    I think we go up from here and continue the metals rally. I think it’s a reasonable bet, but I’m not advocating anybody follow.

    Just running commentary that could be very wrong, of course. That’s the reason for the stops (which will still cause me losses.)

  134. alex

    jay…

    cancel that…I guess you are talking about the LARGE DECLINE day…then sideways

    I was thinking the recent run up…pennant…then continue

  135. Poly

    Although Gary called it, what are the chances that we really are still in the dollar uptrend of the last cycle low?

    Looking at the dollar chart, the last uptrend was VERY short, mild and interrupted by QE. But if you compare it to the Aug cycle low, which had a month uptrend, is this really any different? We’re not even at the 50 day average?

    http://stockcharts.com/h-sc/ui?s=$USD

    Could we get the SPX low now while the dollar continues an uptrend to the 50 day and then have the next cycle begin?

  136. Shalom Bernanke

    With it being Veterans Day and all, it’s been a good day to get stuff done around my place.

    I’m not at all concerned about the USD. The cat is already out of the bag, and everybody now realizes that if it bounces it’s only because Europe is joining in the money printing scam, and in that case gold is still the best option. Besides, the Chinese are seeing inflation and buying all the metals they can get their hands on. I think that at worst we get a little downside reaction in metals caused by nervous USD watchers, and I’ll be glad to take their miners and metals from them.

    Otherwise, sideways to up is expected.

  137. Jayhawk91

    Alex-

    Very short term/smaller time frame possible little bear flag on the 60 minute charts-If it played out, we could fill some of those recent gaps. But don’t listen to me, Gary is your guide here. These patterns don’t seem to work for the pms.

    URRE-I have no fricken clue about them except the chart looks tasty.

  138. MLMT

    Everyone expecting dollar will dump after G-20. Hmm, everyone was expecting stock market will dump after Fed. Hmm…. I wonder what will happen.

  139. Jerred

    Poly,

    I was wondering the same thing. It is acting like the sell off never occurred.

    Already pressing the highs 2 days later.

    I have traded this one for a while and will add on the right setup

  140. TZ (7006)

    For the record, I don’t think the dollar breaks high. I think the action since fed has been a squeeze/manipulation to try and make their actions look like the market approves (and to catch people who were all leaning the same way.)

    I think dollar drops by tomorrow and I think gold/silver will imminently rise.

    WARNING: your loss if i’m wrong and you trade off this info.

  141. TZ (7006)

    The dollar is rallying because the Euro dropping due to another crisis…which just means they are going to print more.

    Eventually you’d think the metals would get it.

    Nothing ‘good’ is happening to the dollar. It just isn’t currently going over the cliff as fast at the Euro. Heck of a way to define “strength” (Not you guys, but wall street in general.)

  142. alex

    I said this earlier

    Tell tale sign…look at the uup for the dollar

    last 2 times it was up to this level it had 11million volume on OCT 19 , then 15.4 million on OCT 27

    today uup has 3 million so far…supply & demand argues

    buyers drying up/probable false rally up.

  143. DG

    Hey Gary: I took your advice and shorted some OIH at 130.10 (stop is the day’s high so very tight)

    [Just kidding. I know you’d never short in a bull mkt. I’m a fair bit short now as I keep adding, so hope we tank into the close.]

  144. TZ (7006)

    http://www.zerohedge.com/article/pomo-schedule-announced-105-billion-monetizations-through-december-9

    If the Fed is going to start printing money like crazy for the next month (starting tomorrow), then why wouldn’t they engineer a rally to try and crank the dollar higher (and not have it being at the lows) before they start? You don’t want to start printing on the low now do you?

    Pretty common technique on wall street, imo. Perfectly reasonable business decision on their part.

    If a bad guy has a lot of stock to sell they could write a positive article about the company or go on TV and say “I love it. Strong buy!”
    Then they sell. I even recall stories about this.

    Well…bernanke has to get rid of dollars the same way. And he wants the price higher before he starts ‘selling’ them. He doesn’t want the market to collapse.

    The Fed and the banks can easily squeeze anything, including the dollar, in a particular direction for a little while.

  145. Jerred

    redwine,

    the best way to compare is total cost for the physical.

    some places show a tight spread over spot but then hit you with the fees on the back.

    I think most people will laugh but I have bought all of my physical on ebay. You have to shop the price and it takes time but the over spot price was so much cheaper.

  146. Razvan

    RW, you are right! it seems your site is even cheaper although they need to spend a few hundred dollars on a new website. APMEX has a shipping fee of $25 added to the total cost. EBAY seems to be more expensive then APMEX for silver or gold coins…i was actually comparing prices today

  147. Onlooker

    I would beware of making some kind of judgment about the superiority (or inferiority) of a closed end fund on the basis of one day. The premium can get pumped up and then let out the next day (or week, or whatever).

    That said, I have no idea of what the premium is for PSLV. And there’s also the risk for the issuance of more shares, just as happened to PHYS back in May or so. That was a nasty development for those who weren’t aware of that possibility (probability really).

    Bottom line is that it’s key to keep an eye on the premium (or discount) to try to get in when it’s relatively low, and out when it’s high. The Sprott trusts don’t have much history, needless to say, and so it’s hard to know where those points are right now, other than taking an educated guess.

  148. Wes

    I would be willing to converse about the stock market, but I think patience is in order since I don’t short bull markets.

    From what I read, most participants are looking for a strong Thanksgiving week/ December finish for the market. Sentiment is not overly bullish but I think is overly complacent. I measure the latter by using multi-week averages of sentiment readings.

    I believe the market will correct and it’s going to take longer than most folks expect, throwing off the Thanksgiving timing.

  149. Jerred

    Razvan,

    I buy from the sellers that offer free shipping and then bid spot price (not a cent more).

    I buy the 10 oz. bars this way and have done very well. (takes a little more time tho)

  150. Shalom Bernanke

    As far as Tulving vs Apmex, one might consider that Tulving’s basic site is also not updated as quickly. Therefor, on days where the metals are up, like today, Tulving might have the better price as they haven’t yet updated them. If buying into declines like I tend to do, APMEX will have better prices. This is something I noticed way back when I started buying physical, but perhaps it’s changed.

    Yes, I did pay $25 for shipping and insurance.

  151. Robert

    I’ll get you when your out to get a burrito that I know you will fall for πŸ™‚

    Hey SB,

    If I remember correct you sold off 50% of your position, do you have a plan yet on when to add those?

  152. Jerred

    it’s all good Redwine not worried a bit.

    Been buying broken silver jewelry for years at or below spot.

    I have more than plenty to hold me over.

    Cant wait to cash it all in at the local refiner (NTR) and get my bars.

    Sell all of them on ebay at some ridiculous premium.

  153. Nick

    Gary: I got a question for you. We have beaten the topic of Manipulation several times – now if the Fed (or JPM or any big institution) were indeed manipulating the markets, why would they care about the lines in sand? They can take it higher or lower anywhere they want no? Lines in sand barely matter to the big dogs?

  154. Onlooker

    PHYS has underperformed gold pretty substantially during this intermediate cycle (i.e. from the July low); 14.81% to 20.68 through yesterday. And anybody who bought in the middle of May, when apparently the premium got kind of rich, is underwater on their purchase (-2.13% vs. 13.91%0. I bet they’re pretty pissed right about now.

    You’ve got to know what you’re buying when you buy the closed end funds.

  155. Shalom Bernanke

    I did sell off half, but also posted that I put back on some ANV and SVM (SVM was the sweetest fill this year, as I was far away from the market at $11.17 for size when the stock was up on huge at new highs the other day…got filled and the low tick was $11.15, but that was just lucky).

    Now I’m back to 75% invested, 25% in reserve, and ready to add should we selloff. Only in an extreme sell off would I borrow on margin. Gary’s right about leverage, one can be correct and still lose if they get too heavy. I’ve never been more than 120% of account size.

  156. Shalom Bernanke

    Onlooker is correct. However, those results are because all things gold have risen. As I mentioned yesterday, PHYS typically outperforms (down much less, as they hold physical and experience somewhat of a flight to quality) when gold gets hammered.

  157. TZ (7006)

    Earlier in the week, the weekly candles on silver an gold looked like massive reversals.

    However, we have been creeping up since then (as I am betting) and if we continue through to tomorrow (and accellerate a bit) then the weekly closes will NOT be ‘reversal sticks’ anymore.

  158. Jerred

    I am looking for an edge in the market and right now I dont see it when it comes to gold/silver.

    If gc/si move above the highs then I will add leverage at that time because shorts will drive the market much higher.

    If we move below the lows set on Tues then I will wait for the correction to run its course.

    I am 100% cash and loving it!!

  159. Jayhawk91

    Onlooker-

    I know, I wasn’t making a statement about the superiority of PSLV, just making an observation. This fund is brand spanking new we are in uncharted waters. PHYS has only done 11% the past three months vs 17% for GLD, IAU, SGOL.

  160. DG

    Covered almost all my shorts at the close. I got a strange kind of buy signal. I say strange because this variation has not been well tested, happens rarely, and is a slightly odd mix of what I use to generate them. I didn’t go long because I figured my PM stuff ought to go up if the SPX does. Glad to have had the ” hedge” the last few days thought it didn’t turn out that way. Amazing PM’s were up today.

  161. Wes

    alex,

    I have no strong opinion about the dollar. Often the stock market, particularly early in corrections, will ignore the dollar.

    Eventually POMO will be priced in (it probably already has) and the only effects will be the timing and amounts (I think this happened yesterday and today in anticipation of tomorrow’s POMO.).

    Once those effects are over (maybe already), then we continue to correct.

  162. Poly

    “Amazing PM’s were up today.”

    They have been showing strength and leadership for weeks now. When you consider they have pretty much lagged the bullion for the past couple of years and now finally broken out ($HUI), I’m reading the massive volume and recent strength as a sign smart money is positioning for a run.

  163. DG

    Poly: I agree they have shown RS, but with the dollar up a lot and the market down the same day, I’m still surprised they were up. Impressed, but surprised. Once the dollar starts down we are going to get some run in these things. Great! I look forward to Gary’s report since he said he thinks the fog has lifted.

  164. alex

    DOES ANYONE KNOW HOW TO GET volumes ON THE DOLLAR CHART??

    When I see the UUP up on light volume COMPARED to the last 3x it was at this level…I just see it as a weak bounce. Not real…ubt I’d like to see the $usd chart with volumes if possible.

    Anybody??

  165. LowTax

    Alex, I may be wrong here but I don’t think there is such a thing as volume for the dollar index. It is simply a market based representation of the relative value between the dollar and other currencies. This is derived from all of the transactions (trade, financial flows, etc.) that occur in the world – the volume would be the sum total of all the USD trade, I think… There are no ‘shares’ as such.

  166. alex

    Thank you very much !!

    Stockcharts didnt work ( i am not a member so I get basic charts) , but I will try that link POLY

    Thanks again!

  167. alex

    Low tax

    Thx , I used Polys link and did get a funny volume with $$

    it was very low, so I am not sure what it represents, but it did indicate that volume was

    35,095 for yesterday
    and only 23,112 for today.

    when I see volume drying up at a swing high…it just seems weak.

    supply/demand..no demand. Dollar rally looking weak to me, thanks everyone

  168. MLMT

    Did anyone take notice where they closed GDX today. 1c above Mondays close, thereby making it the highest daily close.

    That is as bearish a close as you can get. If dollar does throw another curve ball, miners are in for epic bloodbath tomorrow IMO.

    If no curve ball, then miners could see new highs.

    The chart of miners is saying former… the sell off on Tuesday has strong implications. They are not to be ignored IMO.

  169. Onlooker

    PSLV has underperformed SLV, 13.5% vs. 15.7% since it started trading.

    Here’s a chart:

    chart

    That’s pretty significant over a 10 day period. Although it’s hard to judge these things as the premium/discount issue can do anything over a short period.

  170. Jerred

    i can’t believe I agree with MLMT.

    I think the higher probability is down, not up.

    If it is up then we should have plenty of time to get long (heavy). Due to the fact that the shorts will be covering above tuesday high.

  171. Tudor

    Re: Physical silver purchases.

    I bought a monster box of ASE’s about, oh, $4.00 ago ;-). Tulving was by far the cheapest after premiums and shipping. Premium was easily the lowest around at $2.39 over spot; shipping and insurance were free. They even gave me a $15 rebate on the bank wire fee ’cause I got it to them within 24 hours. One downside to Tulving, besides their barebones website, is their high minimum order. It’s 20 oz. for gold and 500 oz. for silver. For smaller orders, I use Gainesville Coins and Provident Metals. Gainesville usually has better total pricing if you do a wire, but Provident will take a personal check (with delay, of course). All three have great customer service.

    I’ve bought off Ebay – mostly 90% junk for spot or even below. That’s getting nearly impossible to do as buying is picking up and premiums are rising.

    I dig my physical gold and silver. I want more, but I’ve been resisting because I know the miners are going to give me much better returns. I’m thinking I’ll pick up more when the D wave bottoms next year.

  172. Poly

    “Cash on the table” was a metaphor, but in this context could be taken literally I guess.

    So if your motivation to hold it is devaluation over investment return, there are plenty of other bullion alternatives (and non) that will accomplish that without having to carrying bags of metal coins around.

  173. Redwine

    Poly…I used ‘cash on the table’ as a metaphor as well. It just seems to me that if our fiat currencies do go to zero the share price of a company will be next to meaningless. Why would you carry metal around when it can be easily stored in many vaults?

    Also, what do you think is causing the price of PM to increase? Certainly not all the paper gold investments (they reduce the dollar price). Demand for the physical is driving this bull.

  174. Bede

    “[H]ave you looked at Irish Bond Spreads lately?”

    “They blew through 600bps today.”

    “That’s beyond the event horizon. The singularity is somewhere around 800bps. At the present rate we’ll get there in another few days, and we might get there at a greatly ‘accelerated’ rate.”

    “I strongly recommend that you pay close attention to this. The Irish banks were basically carpeted-over much like ours, except that this is a much smaller economy and the lies are harder to maintain. Now the dead fish has rotted the floor joists, and the creeking noises are getting louder.”

    “Should the ECB intervene, and I expect them to, it will not fix anything.”

    “The possibility of a monster move – southbound in equities, northbound in the dollar, southbound in the Euro – is definitely on the table here.”

    http://market-ticker.org/akcs-www?singlepost=2257026

    Whither gold and mining stocks?

  175. Poly

    It’s a debate with no end, which is why I don’t frequent the ZeroHedge and the like sites. If you seriously believe the dollar will be utterly worthless then your bag of coins might save you. However the share price of a miner who’s products are the basis of these shiny coins you carry will certainly outperform your holdings.
    Not to add the fact that shiny coins are almost illiquid for anything other than your hated fiat money!

    For me it’s simple, it’s a generational secular bull market we must take advantage of, but it’s time will pass too!

    Hold some gold ounces/bars in your pocket, just in case, sure can’t hurt.

  176. Poly

    Bebe you’re right and Portuguese and Spanish debt is also selling. But this isn’t new, Irish yields have been rising rapidly for 4 weeks.

    The European equities reaction and Euro decline has been relatively tame this time around and judging by those spikes we could be about to peak, for now.

    Who the hell knows when, but I would agree with you/article that these PIIGS are one of or the catalyst for the next big leg down. Let’s hope Gary is right on the timing of that leg.

  177. Redwine

    It’s just a matter of diversification. Without demand for physical the mining companies would be worthless.

    If you think the demand is due to a mania, like the tulip bubble, you’d do yourself a favor to give it more serious consideration.

    All fiat currencies in history have collapsed to zero and the US Dollar is now the champion, having lasted longer than all the rest.

    If it does go to zero and is replaced by gold/silver the governments might nationalize/tax the mines w/o warning and seriously impact the share prices.

    These are dangerous times.

  178. Tudor

    Poly,

    You’ll get no argument from me regarding the potential returns of bullion versus miners. When all is said and done, the miners will undoubtably be more profitable.

    However, my holdings of physical PM are not at the expense of investable funds. I converted most of my family’s emergency fund (about six months worth of living expenses) into physical. It’s highly liquid and will gain much more than the sub-2% I’d get from a CD ladder. I’ve still got some fiat held in a few CD’s paying 6%, as well as two months worth of linen stashed at home.

    I’m not plannning on getting rich off the phys. But I’m nicely hedged in the event the bottom falls out either in my own “domain” (i.e. loss of job) or in the context of a larger “situation” (disaster or societal breakdown). Helps me sleep at night.

  179. Poly

    “and will gain much more than the sub-2% I’d get from a CD ladder.”

    This is opinion which you’ve taken as fact in your decision and therefor discounting risk. The stated return on the CD is fact, which explains the poor return.

    Some diversification/security to phys I can definitely accept, but it’s not for investment purposes.

  180. Onlooker

    Thanks for the link Poly. It’s pretty nice that they have the intraday premium/discount there, up to the minute.

    CEF’s web site only shows the calculation for end of day; and it’s bogus!

    They use the end of day market price for the fund, but they don’t use the end of day gold spot price. Instead they use some other spot price, at a different time.

    So it’s an apples to oranges comparison and yields and erroneous end of day NAV calculation. Pretty pathetic. You can do the calculation yourself using all the info on the web site. I set it up in a spreadsheet as I was interested to see how it progresses during this c wave.

  181. Tudor

    Poly – I’ll disagree. Your POV discounts the inflation risk of holding fiat. I’d argue that in light of the current environment – the U.S. government actively debasing the currency among other things – PM offers a higher risk adjusted return than a 2% two-year CD. There’s a reason nobody wants to hold cash or cash equivalents when there is a maniac at the helm of the central bank.

    And like I said, my PM holdings are not an explicit investment. They are emergency funds.

    “Not to add the fact that shiny coins are almost illiquid for anything other than your hated fiat money!”

    ?????

    Have you ever exchanged a “shiny coin” for something you needed or wanted? Perhaps not. It’s not that difficult. Take shiny coins to shiny coin dealer. Yes, dealer gives fiat in exchange for shiny coins. Fiat can then be exchanged for items of value that are wanted or needed. It’s recommended, in the current environment, that the fiat be held for as short a time as possible.

  182. Poly

    I’m not arguing your Investement or advocate holding fiat. I’m simply saying that your statement that silver will out perform the CD is just an opinion that your are taking as fact, and comes with risk you’re discounting. FYI the miners are debasing gold too πŸ™‚

    This talk is so 70’s just as the world was ending, they were right then too. I guess I’m saying that taking a position as gospel and getting married to one theme seriously clouds judgement. If you’re holding a “small” position of your net worth at home, that’s great. OK, let’s hope that dollar crumbles πŸ™‚

  183. Steven

    Interesting thought from Lance Lewis. I personally was thinking they were keeping the dollar up to deflect criticism during the G20 meeting. I suppose we will know the answers to all of these issues shortly.

    Lance Lewis Comment…

    Don’t forget that the Fed’s money printing doesn’t actually begin until tomorrow with a $6 to $8 bln confetti spew. After that, we get money printing every single day next week, with 4 crazy days of between $4 bln and as much as $9 bln followed by $1.5 to $2.5 bln on Friday. That’s a lot of new confetti to flow into gold and other hard assets.

    In short, the dollar’s bounce is about to be crushed by a tidal wave of $40 bln in fresh new confetti over the next 6 days that begins to get dumped on to the global markets starting tomorrow after the G20 ends in disarray. Be ready…

  184. TZ (7006)

    OUT my gold and silver futures positions from the morning. They went lower than I expected. Dollar rally (I was wrong on that call too) not helping.

    Lost a tiny amount on the trade.

    Slinking back into the shadows waiting for the next attack
    πŸ™‚

  185. Gary

    TZ,
    It’s too late in the daily cycle to place leveraged long bets.

    Those can only be placed as gold moves into a cycle low. Unfortunately that’s the toughest time to make that kind of bet because our emotions say it’s going lower.

    This is where cycles analysis is invaluable.

  186. Walter

    @ Onlooker

    On a closer look, turns out you’re right. The chart header says just US Dollar Index, but the page header (where so far I had never bothered to look, having framed my browser to show only the chart) indeed mentions the front month (currently Dec 10).
    Sorry…!

  187. aviat72

    Does any body trade SI futures here?
    It is a beast. Huge leverage (1 tick = 0.005 = $25). Right now the market is very thin (after GC broke 1400) and is being jerked around all over. The price is jumping 20 ticks (0.4%) in a few seconds. You could be up or down $500 in a second or two. GC has taken out yesterday’s low while SI has not.

  188. TZ (7006)

    GARY,

    Trust me…your comments tonight factored into my decisions.

    PS: I whipped around on the exit so actually ended up losing a bit less than 1% (net worth) on the trade. Acceptable to me for a trade I had such high confidence in.

  189. fubsy_cooter

    TZ

    Based on the futures this evening, looks like getting out likely saved you a bundle.

    Looking forward to the eventual roll over in the dollar. It shouldn’t tkae long for PM sentiment to lose the froth. Most want to see them fall, and let this bias their view of the market.

  190. thedocument

    Jesse,

    It’s not a bad idea, though I’m kind of enjoying having a relatively small, but cozy group of subscribers. The comments in the Member area are informed and cordial, and I don’t have any of the trouble Gary expresses about e-mails. (Must be tough having that annoying, 6-figure income on the side of your trading, eh?)

    I figure if the subscriber base grows organically, the quality will remain. Thanks for the plug, though!

  191. v

    Hi Gary,

    USD made a high of 78.4 and went down to 78. should we take off leverage now on silver and gold as planned.

    V

  192. Gary

    Your wasting your time with these meaningless support levels. Gold is dipping down into a daily cycle low.

    This C-wave isn’t over so broken support levels are recovered.

    Trust me at the bottom it’s going to look like gold is broken. But then again I heard the same thing at the July bottom.

    Technicals are meaningless. one has to use cycles analysis to buy the dip in bull markets.

  193. MLMT

    Gary,

    Thanks. Feedback taken well. I assume that cycle theory will give the TIME and not the price at which to enter. So, some estimate on when the daily cycle low would come – a range is fine. I dont need an exact date and time.

  194. Onlooker

    v

    Are you a subscriber? Your question suggests that you’re not (since he covered that last night). And if you’re not, then why would you think that Gary is here to give you advice?

    As has been discussed here recently, Gary has his hands full just dealing with paid subscribers, much less blog commenters. Some people come here trying to milk him for the info from his newsletter, IMO. Just cough up the small entry fee, fer cryin’ out loud.

  195. hiptwist

    Some days ago somebody asked how to save Garys reports as PDF.

    I use the free PDFCreator for this: It installs a dummy printer which generates PDF files instead of paper when selected as printer.

    You can find it here:
    http://sourceforge.net/projects/pdfcreator/files/

    But read the “malware” section on the WIKI first:
    http://en.wikipedia.org/wiki/PDFCreator

    I personally would recommend to use version 0.9.6 or earlier to circumvent the toolbar of the newer versions. I personally still use 0.9.0 and it works fine too.

    Hope this helps

  196. MLMT

    Gary,

    So Oct 22 was the previous cycle low IMO. If Oct 22 is day 0, then today is day 15. So, gold should bottom out in 3 to 10 days (sometime next week to thanksgiving day).

    Thanks that is useful indeed. Appreciate your help.

  197. Gold Era

    Gary,

    I would like to know how do you master the market? As we know, individual always focus on wrong things. What advise would you give us for joining this gentle-game? πŸ™‚

  198. v

    Onlooker,

    I am a new subscriber but I missed reading last night reports as I am still use to emails. Gary pointed it out to me aswell that its covered in last nights report. πŸ™‚

    V

  199. Onlooker

    OK, sorry v if I came across a bit harsh. It just gets under my skin sometimes, and Gary has a lot more patience than I do, for sure. πŸ™‚

  200. v

    Onlooker,

    I agree Gary has a lot of patience, unfortunately I’m also in the impatient lot.

    No problem, I understand πŸ™‚

    V

  201. DG

    Yeah, but I covered way too much yesterday near the bell. I got thrown a curve-ball myself and got faked out a bit. Oh well. As Gary says, it’s not easy to get entry and exit right, and Old Turkey in a bull is a helluva lot easier. After a long lifetime of successful trading, though, I’m not changing now…except in gold πŸ™‚

  202. DG

    Got a bunch of shorts off on that silly rally back to down 15 as other traders bought in anticipation of POMO. Covering at the close yesterday turned out not to cost me too much Market is way overdone on the upside, and all cycles point down now. Don’t mind having some protection for my PM positions as gold works its way into its cycle low.

  203. Shalom Bernanke

    Nah, I haven’t bought anything yet. I’ll either wait until the swing low Gary is looking for, or buy into a sharp decline when the $HUI hits my lever, which is still a good bit lower.

  204. notGreedIsGood

    gold just took another dump, and moved below 1380… anyone willing to guess the bottom? I’d guess about 1340-1360 will be a good time to re-enter… what do others think?

  205. TommyD

    On SIL 6 month daily chart, I chose a fibonacci retracement trend from 7/28 to 11/09. The 38.2 will fill the gap perfectly from 11/04.

    I plan to add back to SLW maybe .25 cents above the 11/03 high-of-day for what it’s worth.

    GL

  206. Tudor

    Ok, I’m guessing Mish’s blog was hacked. Maybe Helicopter Ben has a crack IT team systematically taking down the resistance. As one wag at ZH put it:

    “All your bloggers are belong to us…”

    BWAHAHAHAAA!!!

  207. TommyD

    Next week could very well be a good one to turn off everything and spend time outside to enjoy nature with family and friends. Then roll into the holidays the following week with the market winds to our back.

  208. pimaCanyon

    Gary, if Gold trades below 1315, that would give us a failed daily cycle, right? Then we’d likely have a bounce out of that daily cycle low, followed by another even lower low that would be the intermediate cycle low, right?

    So everything depends on 1315 holding. If it holds, then gold will likely make a new high (which will become the IT top) before heading down into the IT low. If 1315 does not hold here, then we have already seen the IT top, right?

  209. DG

    I agree that it’s too bad for Gary to be pestered with questions on the blog, but at the same time that’s how he builds his subscriber base. If the blog had no content of value, and every question just said “buy a subscription and check out the terminology”, no one would be tempted to buy a subscription. At least, that’s how it worked for me.

  210. Chrys

    Gary – it might help some of your subscribers to have a PM scorecard summarizing your advice: Buy, Buy with leverage, Reduce leverage,Wait, Sell, Sell with leverage. You could have a scorecard for Stocks, PM, and Miners.

    Your narrative would go on to explain your thoughts for the day.

  211. Poly

    Oh come on, if Gary answers these questions in the comments section then why pay for a subscription. When, how and with what to buy and when the swing occurs is what we pay for!

    Of course he attracts subscribers by answering questions, generic questions, but not the questions that subscribers pay for.

  212. Josh

    So it looks like we’re too early for a daily cycle low, which suggests more downside possible next week. But these lower prices are tempting me today.

  213. Gary

    If they are tempting then it isn’t a low.

    If you have to have someone else pull the trigger while you look away then maybe it’s time to buy.

  214. pimaCanyon

    Gary, for those of us who plan to take off some of their positions –IF– gold breaks 1315, would you recommend doing that on the break of 1315, or instead, on the bounce out of the cycle low (that will follow that break of 1315)?

    (The problem, of course, is that if 1315 is broken, we won’t know how much lower gold will go before making a daily cycle low AND we won’t know how high it will bounce after making that low. So the bounce could end up being a lower price than 1315.)

  215. TommyD

    Just heard a rumor that Asian buyers are set to buy silver at $25.50 as FED banks attempt to unload shorts below that when they go to hit their clients stops. Yes, banks are betting against their clients.lol

  216. alex

    Just want to add that I subscribed because I read this blog…and the detailed charts that Gary posted with his commentary…such as

    “all the signs in place”
    “final leg up”
    “Curveball”

    and I wanted the charts and daily thoughts. I still heard of swing lows and cycle timing questions on this blog, but Its MUCH MORE when you subscribe and see daily charts and so on…

    without this blog ,I wouldnt have known if he was accurate or not.He spoke , it worked , so I signed up.
    It may sound like he’s giving away treasures, but it whets the appetite.

    If you dont think so…JUST TRY THE BLOG AND NOT READING YOUR SUB FOR 1 WEEK, just read this blog w/ questions and answers…You’ll feel ‘uncertain’ still. (My humble poinion)

  217. tfortrader

    Gary, I’ve quietly enjoyed your work for some time. Thanks for taking all the time to educate us neophytes. I’ve especially enjoyed the thoughtful and entertaining debates b/t you and Doc. I don’t know if you two had a private bet about the recent action, but I gotta give this round to him. He dumped most of his positions Tuesday saying that the risk of an intermediate decline had picked up and he stuck to that view even while gold bounced back. He also believes the dollar is most likely in a new intermediate cycle. You probably know all this already, but I was just wondering what in your view would confirm a new intermediate cycle for the dollar and decline for gold?

  218. Gary

    I laid out my views in last nights update. Because of the stock cycle it’s unlikely this is either an intermediate bottom in the dollar or top in gold or stocks.

  219. alex

    SEE…THIS IS WHERE GARY USUALLY SAYS…

    I COVERED THAT IN LAST NIGHTS REPORT πŸ™‚

    or I’ll Be covering that in tonights report πŸ™‚

  220. Dean

    I’ve already canceled my description with Gary and signed up with thedocument…. kidding. However, it does look like docs call was the correct one and was also how I positioned myself – those bearish engulfing candles were pretty ugly.

    Also, I didn’t get in at the July lows so I am just trying to pick the middle thirds of these swings. You have to measure Gary’s work, and his positions, with your own style and positions. You can’t come in this late in the cycle and manage your account exactly as he is, you could easily get cut in half.

  221. alex

    someone is buying , because my old turkey account was bleeding , now its healing a bit…daily downtrends in EXK and HL have broken to the upside.

    HMM , silver stocks…The asians ARE buying??!! πŸ™‚

  222. alex

    HHMMM , but my silver stocks are being purchased…

    maybe 25.50 is secret code for the time of day they’ll buy

    25.50 hours from noon yesterdays G-20 mtg is…..1:50 p.m. NOW!! 1.50 N.Y. time!

    GENIOUS!

    BUY BUY!! πŸ™‚

    J/K of course

  223. Poly

    LOL, it’s funny how after a nice correction, every finance site and blog come immediately switch to extremes. Two days ago QE was going to save the world and make my breakfast daily, now it’s a complete failure, we’re a currency manipulator and we’re going to default ROFL.

  224. Jerred

    TZ,

    should have posted the link.

    i get most of my reads from reformedbroker

    //www.thereformedbroker.com/

    I only read and post when I am bored and not trading

    or

    When somebody posts some ridiculous comment, I just cant help myself.

    Any trades today?? What are you watching??

  225. coolkevs

    Days like today leave a sour taste in everyone’s mouth, especially those who thought AGQ was going up to 200 lickety split. I traded SKF back in the day – hard to believe I used to love that volatility – the nice round numbers (200, 300) were always a sell sign. Alas, SKF is a smoldering ruin of its former self. Gary is right, leverage will kill your portfolio if you take on too much of it.
    Demark -well, nothing has really changed – GLD, SLV, SPX, etc. are in the midst of WEEKLY sells with increased probability of selling through the end of November lessening into the end of December. Dollar on WEEKLY buy through the beginning of December. Prof Depew on Minyanville stated a SPX target down based on retracement of 1155.24, but there is also a WEEKLY up momentum level dangling up at 1287, so probably don’t expect a descent into Flash Crash territory this time…

  226. alex

    I wonder if we’ll retest that blow off top, my old turkey account is again rising , and buying coming in on

    exk , hl , pal, gbg

  227. alex

    this mkt could start buying, suck some in , and flush the tiolet in the last 10 minutes…

    or

    buy the dips at the last hour

    my crystal ball broke haha

  228. Poly

    I think (need)the market needs to close “flat on it’s ass” today.

    The entire commodity space is being smacked and rightly so, in hindsight, considering how stretched they all are.

    We’ve got China fueling the commodity play and Europe fueling the Treasuries/debt play(Muni’s getting smacked too)

    But why the hell is the dollar flat, makes no sense in light of the debt play. Tell?

  229. Daniel

    Poly–
    Dollar trading more on the Ireland news. I suppose I should say the Euro is trading on that news—thus pressuring our dollar– (even though we are doing whatever it takes to devalue)

  230. coolkevs

    From http://www.minyanville.com/businessmarkets/articles/economy-piigs-hyperinflation-inflation-deflation-depression/11/12/2010/id/31116

    KEVIN DEPEW: If you look at the dollar, it’s already collapsed twice since the peak in 1985. Twice. The dollar collapse most assuredly happened. It recovered about half of that collapse in 2001 and then collapsed again to make a new all-time low in 2008. It’s happened. Everyone was right. It’s time to stop predicting it. It’s like the entire country has been gathering outside the Super Bowl every year since 1979 to successfully predict the Pittsburgh Steelers will win the 1979 Super Bowl. You’re right. They won. You can stop predicting it now.

  231. pimaCanyon

    SoS and BoW is not telling much today. Since the market is down so much, we wouldn’t expect to see a lot on SoS because stock has to be up to appear on that list.

    SPY does not appear on BoW, so it’s likely a bottom in not yet in on stocks. The only PM related stock I see on the BoW list is GDX. We’ll see where and when gold puts in a bottom

  232. Jayhawk91

    Those gaps are getting pretty close now…I have a feeling it’s going to be a quick touch and reverse. Gary says you will have to have someone else pull the trigger while you look away. Is this true on a daily cycle bottom or I thought intermediates were the toughest to buy.

  233. Gary

    I’m afraid you are all going to be wrong, This is not an intermediate top in either stocks or gold. You are letting the daily wiggles play with your emotions. I suspect the selling will be done by the middle of next week.

  234. Gary

    As a matter of fact I’m willing to bet another burrito on the fact that this is not the yearly cycle low for the dollar and not an intermediate top in gold and probably not an intermeidate top in stocks.

    No SoS numbers. Odds are heavily against an intermediate top without that. Not to mention for this to be an intermeidate top in stocks we would have to put in a daily cycle bottom soon, then roll over into another complete daily cycle down.

    Not gonna happen during the bullish December period.

    People you are letting your emotions make decisions that aren’t supported by fundamentals (QE) or cyclical structure.

  235. DG

    Gary: Time for the troll meter again? At times like this the “anons” really pulled their weight. Human emotion is amazingly consistent isn’t it? This game is endlessly fascinating.

    Kept all my shorts this time. Plan to cover when gold bottoms as I suspect stocks will also bottom then. Unfortunately today my PM stuff was down a lot more than my shorts were.

    Have a great weekend everybody!

  236. Josh

    Here’s my current thought. Better traders/superior intellects please dismember as appropriate . . .

    I’m currently 100% cash. Will take full position if gold makes it down into the 1330s next week. Stop below 1315. Otherwise, enter on new high in gold.

    Or, wait for the nightly report. πŸ™‚

  237. thedocument

    TZ, I assure you I will never sell at the exact top of anything save for blind luck. In fact, I went into Tuesday with no intention to sell, but then we saw a buying frenzy and a sharp reversal. I dumped my silver futures around $28.25 and then worked on other holdings in the Docfolio. It was what I call a “Soros Moment”: the sudden realization that a view about which you have conviction is incorrect.

    Basically, I got out to protect capital. I won’t get back in until I see a new, high-probability setup, which 90% of the time is near an intermediate low. Now, contrary to what is implied above, the action only made me think it is possible to see an intermediate decline in gold. We don’t yet have confirmation one way or another. Likewise with a new cycle for the buck, although the strong bounce off the 3-year cycle trend line has me favoring a new intermediate cycle.

    Anyway, just to keep things interesting, I’ll take Gary’s bet about having just seen an intermediate low in the dollar. I’m down a burrito and need to win it back πŸ˜‰

  238. Romeo Bravo

    Doc/Gary, boy that poor burrito is sure going to get beat up going like a ping pong between Atlanta (I think?, Doc?) and Las Vegas. Might be better as a trophy than something to eat!

  239. Todd

    I hope you win your burrito, Gary.
    I will be really impressed if GLD and SLV can overcome the massive reversal on huge volume this week. My portfolio will be even happier. Have a good weekend.

  240. Gary

    Not a chance in hell πŸ™‚

    That will only happen at the next D-wave decline. I doubt gold will even make it to $1300 and if it somehow made it to $1265 buying pressure would overwhelm shorts.

    No this is just a normal move down into a daily cycle low that will probably be finished sometime next week.

  241. Marc

    I wonder about the SoS numbers. Usually when a reported number indicate future trends, it stops working eventually since the market figures it out.

    I also see the PM trade as starting to get crowded. It’s like everyone I know is in silver (I have too many friends who brag about it).

    A good correction, like this past summer, would help the PM trade.

  242. Brian

    Marc,

    I don’t find the trade crowded at all. I have several trader friends that are now acknowledging thePM’s, but are not on board. They would like to be somewhat, but a day like today happens and they give you that all knowing nod of “see I told you” and leave it at that. I think it will be a good while before folks like that are fully engaged. I am receiving calls now from folks asking how to join in though.

    Thanks again Coach for keeping me on the right side of the trade.

  243. Bede

    Here’s some confirmation bias reinforcement:

    Silver – Still The Investment Of A Lifetime

    “I believe silver will become the single most important investment of our age, filling the void in the wage gap gold leaves behind. As gold shoots into the stratosphere, it will be silver that people turn to most for smaller investment needs, which means much higher demand and much greater returns for those who are smart enough to buy now. $27 an ounce is incredibly affordable, especially when considering that the metal has the potential to reach $75-$100 an ounce in the next two years (and that is a conservative estimate).”

    http://tinyurl.com/294qcdb

  244. Brian

    Bede,

    The article may be correct, but realize very few people read such things. This bull has a ways to go before full engagement.

  245. Gary

    Actually the public sentiment poll for gold is only a little past neutral. The last correction cleaned out quite a bit of bullish optimism.

  246. Onlooker

    That’s good to know Gary. I was wondering what that poll was saying lately, as I no longer subscribe to SentimentTrader.com

    Here’s another pretty good and balanced article on silver’ situation from Zeal:

    Silver Toppings

    Verdict is that it is a mixed picture, with silver having made a stellar run and reaching a very overbought condition. But gold is not in that condition yet and seasonality is quiet positive.

    That’s pretty much how I’ve been thinking of this. A bit anxious about silver’s run, and trying to get a bead on the sentiment that exists vs. the fundamentals (i.e. QE2). Bottom line for me is that all that considered, along with Gary’s cycle interpretation, keeps me in the trade here, with a large exposure.

    We still have a good level to watch that will safely take us out for a deeper correction. Just have to have the discipline.

  247. JG

    Gary, your analysis completely discounts the problems in the eurozone. Is this wise when the eur is the largest DX component…

  248. Gary

    People somehow seem to think that the austerity measures in the Eurozone are Euro negative. Nothing could be further from the truth.

    Europe is doing everything they can to avoid destoying their currency, while we are doing everything we can to ruin ours.

    How is this in any way dollar positive? This is just a technical bounce to relieve extreme bearish sentiment. It will run it’s course quickly and then the dollar will get back to the business of collapsing down into the 3 year cycle low.

    Fundamentally, an extra 900 billion dollars created out of thin air isn’t going to help the dollar.

  249. Gary

    The weekend report is posted.

    I expect silver will continue to follow and magnify the moves in gold just like it alwasy does.

    This is why I typically just follow gold. It is the cyclical driver of the PM sector. But I invest in silver.

  250. alex

    If your curveball report is now incorrect ( dollar breakout )you may want to just do a small update, so that future subscribers will see that you are on top of things as they change.

    otherwise it may look like you think the dollar has bottomed (yrly)last wk and gold topped.

    just a thought

  251. sucky sucky

    The Bernanke has repeatedly said that QE2 is an asset swap and not funded by “printing dollars”. Does that in any way alter how you think about the impact of QE2 on the Dollar?

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