526 thoughts on “CONTRARY INVESTOR INTERVIEW

  1. Nike Boy2008

    Hi Gary,

    Maybe you can’t answer this on this message board, but in your nightly report.

    I see that people are way too happy and cocky on this board

    Do you think that the USD just threw us a curve ball by moving back over the 77 pivot?

  2. Gary

    Sorry folks I’ve been out all day and I just don’t have time tonight to read through the 300+ posts and answer questions tonight.

    Ask them again if it’s important on this thread and I’ll try to get around to it later.

  3. Shalom Bernanke

    Why not just trade the metals instead of of looking to the dollar for direction? It’s not like anybody knows with certainty where the USD is going any more than metals, and more importantly, any prediction also requires that the typical inverse relationship between the two will continue each step of the way (it hasn’t for some time, even if it will again).

  4. mylifemytrade

    @ALL of you who post real time / near real time (esp EricH & Arun, who seem to click the “Publish your comment” with one hand and “buy/sell” button with the other hand at the same microsecond)

    In again at 1434.. yeah yeah… I didnt do real time.. Ok.. for your guy’s book-keeping sake, it is 1431 (which is where we are right now).

  5. Brian

    MLMT, I guess you are really just a godsend for all the futures traders on the right side, since that market is a zero sum game. Seems you just have an unlimited amount of money to lose……..

  6. Brian

    Great interview Gary. Glad you are starting to get some media exposure. That bothered me previously, as I wanted to keep you wrapped up! Clearly that won’t be possible. Great luck as it expands.

  7. Arun

    MLMT.. either post real-time about ur trades or quit boasting about a small loss. Based on below, how can you not be a cheat?

    1. You went short on 2/18 EOD. based on your post Based on that, your 75% position basis would be 1390 and not more. 1390.6 was the max in the last 2-3 hrs of that trading day.

    2. Magically your position basis became 1406 as you averaged up. No posts about averaging up but you can taunt like “Its coming… 1388.. its coming” How convenient!! This like 16 pts up in average when you got only 25% position left. Geez!!

    3. When GC’s trading at 1420+, you covered at 1410 for a 4 point loss.

    (2) & (3) has no real time posts. I don’t have a problem if you took a short trade and covered. But it insults if you want me to accept it was just a 4 point loss.

    BTW, no answer on the silver puts.

  8. Razvan

    Nike Boy
    maybe i am wrong but i have been on this blog long enough to know that people who make comments like that are either out of the market or under invested.

  9. Shalom Bernanke

    It’s not just the small loss that MLMT says he took, but the big gains he could have had (if long) but missed.

    As far as getting out yesterday, but telling everybody today to save face, well he’d like us to believe he doesn’t peek in here enough to comment when he exited.

    More upside to come, even if mlmt is right for a day or two.

  10. pimaCanyon

    SB,

    I was out this afternoon so missed your question re the silver channel.

    I had a steeper channel for silver until the big one day drop last week. I’ve reset the channel lines based on that low and the high that preceded it (and include the low of late January, of course), and I end up with an upper channel line around 36.50 by midday tomorrow. Lower channel line tomorrow morning is at 32.90.

  11. pimaCanyon

    Another interesting thing about silver channels: The big rising channel that begins at the October, 2008 low–silver busted out of the top of that channel on 2/21 and 2/22, dropped back inside it for a few days and busted out again today. We’ll see whether it stays out for a while. Silver’s rise since the late January low of this year is much steeper than the daily channel going back to the October, 2008. If PM’s are moving into a blowoff top, we would except the channel to get steep and stay steep.

  12. traderlady

    I am a new subscriber and am very impressed with the knowledge of most of you on this blog(TG, Shalom,Jayhawk, to name a few). High marks for Gary! I am so lucky to find this.

  13. pimaCanyon

    MLMT,

    You may get lucky and catch gold riding down into its daily cycle low.

    Where are your stops on your gold short? And what is your target?

    Are you short silver as well? If so, at what price.

  14. EricH

    “mlmt makes confident entries around here, but waits to see what happens for a day or two before sharing his exit points.”

    Exactly.

    I entered a number of April GC at 1330 a few weeks back. <–what value does such a post provide?

  15. Brian

    Pima and SB,

    I am much more focused on the channel of the weekly silver chart going back to the start of this bull run in 2000 ish. We dropped out of that channel in August of 2008. Even though prices slowly rose starting in November of 2008, we didn’t re-enter the channel until Nov of 2010. We back tested that re-entry at 26.38 in January and have not looked back. Gary’s target matches the top of this channel quite nicely.

  16. Nike Boy2008

    Razvan,

    I’ve been pretty much following Gary’s moves right from the go…just haven’t seen the board this jumpy…guess this is a good thing πŸ™‚

  17. Benjamin

    Dear Gary & Top Guns, is anybody gonna buy options with some of the “market’s money” (profits) at the daily cycle low?

  18. vuvvy

    MLMT lost all credibility way back when he posted as mylifemytrade and insinuated he was a different person.I knew he was full of shit as it takes someone with even an iq of 20 about 2 nanoseconds to see the correlation between the 2 handles.I sure wish this blog had an ignore button.

  19. basil

    Hi Gary,

    I just recently subscribed, and I do like the nightly reports and also how you manage the blog and answer questions; so I will extend my subscription and hope there will be another special some time soon.
    The radio interview was excellent, too.
    As you know I enjoy the occasional argument, but I am also getting a clearer picture of your cycle analysis and how it applies to PMs and stocks, and I like it!
    Thanks, man!

  20. mylifemytrade

    @vuvvy I clarified before that I ended up using two handles because one email address was blocked from work. I am sure someone like you who hopefully has an IQ of lot more than 20 can understand what this means.

    If I had to use a fake handle, do you think I will make them so obvious as MLMT and mylifemytrade… c’mon.. even if I had IQ of 20, I would know better than that…

    I don’t know why I am fighting a pig again..

  21. vuvvy

    You’re a real dumbazz,MLMT. You know exactly what you posted. You came on as the second handle and stated”didn’t that MLMT guy call for a correction” or something to that effect.I’m done wasting my time with you.

  22. Gary

    No idea. It’s a bull market though and no matter what SLW reports tomorrow the stock will continue to rise with the price of silver.

  23. Shalom Bernanke

    mlmt claims he doesn’t want to “fight a pig”, yet comes to a site where he’s clearly the only one going against the grain (and losing) with total certainty.

    Tell us, what does “3/4 of a position” mean exactly, and if you can’t take a full size trade, why would anybody have confidence in your call for lower metals. Why even bring it up, especially to others who clearly are not invested in that direction, other than to ruffle the feathers?

    Most here don’t post in real-time because we’re not guessing the next 1 day direction, but rest easy mlmt, many of us are up several hundred percent the last couple years. πŸ™‚

  24. Ohio Rob

    Can we please stop the MLMT pile on? I don’t see any point in arguing over his entries or exits. Taking the time to look at all of his previous posts and build an argument against him is rediculous. What a tremendous waste of time. It is not bringing any value to this board. Those of you focused on providing insight, identifying great stocks on breakouts, and teaching us from past failures, thank you…

  25. David Kafrick

    Good interview with Warren Buffett this morning on CNBC.

    Buffett said something interesting: What do you rather own – all the gold in the world, which would be a 67 feet cube or one third of all the companies listed in the U.S. stock market? These 2 things have approximately the same value nowadays.

  26. Shalom Bernanke

    OhioRob,

    You might feel that calling out mlmt doesn’t bring any value, but don’t speak for everybody. I’m quite sure that some might take mlmt’s misplaced confidence seriously and make the mistake of exiting early, leaving lots of money on the table. It really depends on how frequently somebody pops in here to read comments and learn from others.

    A new reader might take him seriously.

  27. Ohio Rob

    ‘We cover the asses of the masses…’ (Buffett commenting of Fruit of the Loom) It was a good interview, it’s appearant he’s not very interested in owning gold. His comment about wanting to own all the farm land in the US rather than all the gold in the world was interesting.

  28. Gary

    David,
    I saw that too. I would point out that in a secular bear market the value of those S&P companies will fall to about 3-400 billion while the value of that cube will go to about 20 trillion.

    Until that cycle runs it’s course one is much better owning the cube πŸ™‚

  29. Rebecca

    If you ask the same question to a Chinese, the answer may be very different. The Chinese would rather have the gold. One of the fundermentals the suports the current PM bull trend is the potential demand from the fast growing middle class in China.

  30. David Kafrick

    Gary,

    I agree with you. But still, it gives you some perspective about how we are already reaching some irrational valuations in gold. I do agree it will go on further, but if you ask that question about the gold cube and the stock market, no sane human being would choose the gold cube. Buffett is a genius at coming up with ways to make people understand his points.

  31. Shalom Bernanke

    As far as owning the farmland in the US, I like the idea, but one concern is that I’m not sure how much it’ll be worth if the US ever has to fight a war on it’s own turf.

    I’ve purchased a few timber properties at great prices in the US to diversify out of Bernanke’s confetti, but that doesn’t mean there isn’t any risk.

  32. DG

    Nike: I think you took the TBT trade I posted yesterday. Good start on it this morning. There are a lot off cross currents in Treasurys due to the QE nonsense, so I will be putting in my usual break-even stop if TLT takes a nice hit today. TBT up over 1% as I write this. I’ll put my mental stop in if it gets to 38.25 or so.

  33. DG

    TraderLady: Nope. My entries are often reversion to mean, so once they move the rubber band is relaxed the entry is ruined. Waiting to see if it “looks right” by getting price confirmation is usually too late, as it is with TBT. Doesn’t mean it can;t work, just that I have lost interest in adding based on mean reversion

  34. DG

    oa92: I will surely post when I get the next SPX buy, but they do not come often and we need some down days to get one, which have themselves become a rariity.

  35. Gary

    SLW has to have one of the best business models on the planet. No way would I sell that with the metals in a final C-wave rally.

  36. Wes

    I’ve been looking at the rate of rise in silver. Last fall the rate was approximately 1.1% per day.

    The current rate of rise is about 2.2% per day.

    I’ll bet that D wave will be a dozy.

  37. Gurvir

    Gary you mentioned “The final confirmation will come when the dollar breaks below the November intermediate cycle low” what value are we looking for here?

  38. Poly

    WES,

    It’s insane. If we get anywhere near $50 then that pace will need to continue. The peak at $50 will sure be a sight and euphoria will be out of this world.
    That environment should setup really nicely for a sizable deep OTM put. A lottery of course, so no major commitment needed. “I would never think of shorting a gold bull” πŸ™‚

  39. DG

    Nike: You dog! You got it at a better price than I did!

    Haggerty: The question is not whether they do well, it’s whether the beat what has been priced into the stock. If they disappoint it’ll go down even if there earnings were up a ton.

  40. Jayhawk

    Those would be rocket fuel for sure. I could see SLW getting rocked extra hard and they seem quite liquid & have tight spreads.

  41. ddn3f

    Jawhawk,

    And SLW will be extremely stretched above the 200 DMA by the time this C-wave is over, even further than silver is stretched. It is also a stock, so it will get dragged down with the stock market at least a little. SLW is probably a good candidate for a lottery ticket.

  42. Jayhawk

    I know it’s blasphemy to talking puts on SLW around these parts, but yes miners could get pounded harder than the metal…Regardless, it would just be tiny amt for me if I do it.

    Looking at the HUI performance so far vs. the summer move–first 6 weeks. Then HUI moved 15% or so off the intermediate bottom, so far we are up 18%…This being the 6th week.

  43. Ryan

    traderlady: I’m a bit nervous with SLW reporting earnings tomorrow but like Gary says, no way am I going to give up my position either so I’m holding strong. I might even put some more in but then that’s just the gambling side of me talking.

  44. DG

    Fair enough about shorting PM’s when the D-wave starts, but I will be focussing on some of the tech pieces of garbage with ridiculous PE’s, or more likely, Q’s You think PM bulls are hard to ride, try shorting and then having a 150 point up day! The 10 points AGQ was down last week freaked people out. Bear market rallies are something to behold! The Dow was up 900 points on 10/13/08 and then broke to new lows ten days later (by the way, I got a buy signal the day before—best one ever).

  45. Wes

    SLW only moving up 1.6% per day vs 2.2% per day for AGQ. Must be the extra vig from the double ETF, which will be working for you in the puts.

  46. n1tro

    Buffet sold silver at $7 at 120 million ounces! I believe he bought at $5. Not bad return even though I’m sure he regrets the move.

  47. Shalom Bernanke

    What was inconsistent in Buffett’s silver trade was that he doesn’t like metals because they have no earnings, unlike companies which can grow theirs, but it’s not like he didn’t know this before he bought 120 million ounces.

    Still, from $5 to $7 is 40% return, so not bad for a trade he didn’t like.

  48. k proctor

    Gentlemen, I made the mistake of bot a few GLD out of the money MArch calls – it is what it is…I have made some modest gains…can anyone give me some input as to when to sell them in here?

  49. Poly

    Shalom, we’re talking AGQ/SLV, no buyouts. Plus we’re talking a lottery put, nothing to cry over if it goes sour. But with Gary’s ability to call the metals and a potential Silver collapse say $50 to $30, it’s set’s up as a very appealing risk/reward bet. As long as one doesn’t get carried away.

  50. bamster

    K,

    I listened to Gary and sold my options and bought AGQ stock. You may not make as much $ but it will be easier to hang on if we get a daily cycle low soon.

  51. Shalom Bernanke

    Even SLV/AGQ short is a poor bet, IMO. As far as “lotto” money, I treat all funds the same and just prefer something with little risk of going to zero. Why not just short AGQ or SLV (with a stop loss in the amount of what you would risk on options), instead of options?

    The decision to use options is an entirely different issue than what vehicle to use them on. I’m not telling you what to do, just saying that I won’t be joining you guys on that trade.

  52. Ryan

    Thanks Gary, I’ll hold off for now, not like i don’t have enough exposure in there anyways. I will add if they sell the news.

  53. Paul

    Gary,

    I would be grateful if you could find the time in the newsletter to lay out your plans for the D Wave with particular reference to those of us who own the physical stuff. Would you sell out completely or go to a minimum core holding (insurance) to ride the wave down?

    Thanks

    Paul2

  54. Razvan

    i agree , shorting the metals is a bad move no matter how you do it.
    I will be cutting my leverage significantly as we approach the end of the C wave and look into shorting the new zealand dollar or australian dollar versus the US dollar as a D wave play.

  55. DG

    My thought for those that own the physical: just short the equivalent of GLD if you want to get out. You’ll be net zero when the D-wave ends.

  56. Gary

    The narrow range day does set up a swing high and possible move down into a daily cycle low. But I certainly wouldn’t sell anything under that assumption.

    In bull markets the surprises come on the upside.

  57. Razvan

    bamster
    i have been trying to figure out why there is no momentum behind the break of the all time high and my best reasoning is the currencies seem to be at important resistance levels but have not broken out yet. The currencies will lead all the other markets so it is important to analyze these charts. When they break out momentum will follow.

    Right now a lot of currency strategists are still bullish the dollar although they are starting to go more neutral.

  58. Gary

    Folks it’s too late in the daily cycle to expect a huge momentum move now. That will come with the final daily cycle up.

  59. Ohio Rob

    What advice do my elders on here have for a 31 year old in regards to investing. I was very passive and just blindly dumped money into my 401k mutual funds until 2007. When my company offered a self directed brokerage account I became interested in learning more about the market and was introduced to point and figure analysis via Dorsey Wright shortly after. I wanted more insight on PMs and I came across Gary’s premium site late last year. I am comfortable with PnF and like the other tech analysis tools I have picked up here including the TOC and cycle counts. I believe I will be best off trying to stay focused on PnF and becoming a master of it vs. trying to learn and incorporate several methods. Just looking for insight here on failures and successes. An answer with the approach of ‘if I was thirty again I would…’ would be much appreciated. Thanks in advance!

  60. Gary

    PNF is just a tool and not necessarily a successful strategy.

    Just ride the bull and you will be fine. Try to trade the bull and you will massively underperform.

  61. Brian

    Exit door on GPL getting jammed up.
    Sold to close Mar 45 SLW options. Return was 516%. Still holding June 30’s.

  62. Gary

    It certainly could. If I was just looking at the silver chart I would say the odds were high that it was. Except silver doesn’t drive the metals sector, gold does.

    Anyway this is why I won’t take a chance with positions here. If we do get a pull back I may add, but I won’t sell assuming there will be a pullback.

  63. Gary

    This is what can happen with these small penny stocks and why I don’t recommend putting very much money in any single one. When the momentum turns they can go down just as fast as they go up. 5% is probably plenty.

  64. Avann

    Yep thanks Gary … I don’t have very much at all in it and I could certainly add more and not feel any pain even if it went to zero.
    I’m just wondering if anyone else is considering adding more.

  65. Wes

    Thanks, and point taken about not selling. In fact, with that in mind, I may do a modest add. I’m at 114% now, 90% silver.

  66. Gary

    Yes we should have to see a swing, which we haven’t. I’m not assuming we’ve seen a cycle low by any means. I’m just trying to warn novice investors of the danger of exiting expecting to be able to re-enter lower.

    The odds are not good that they will succeed.

  67. Brian

    Avann, That is a bearish engulfing candle on GPL. Those frequently but not always are a hint of more weakness to come. SLW has 2 hanging man candles on top now. Those occasionally mean the same. It gave me enough of a pause to close my options, but I wouldn’t sell the stock over it.

  68. Avann

    Thanks Brian … I added a little and now will just watch.
    My average price is still around 3 so I’m good for now.

  69. Poly

    Gary,

    Would you expect a cycle low next week or so, followed by one big very ERT cycle, followed by a ELT into D-Wave?

  70. Gary

    A $3 stock is a penny stock. A stock selling at that kind of price is risky.

    5% is plenty of allocation in something like that.

  71. funmike

    http://www.marketwatch.com/story/paul-other-republicans-rip-into-bernanke-2011-03-02
    Here are some quotes from the article.

    Rep. Ron Paul (R., Texas) called inflation a “deadly threat” to the economy and said it’s being caused by current monetary policy.

    “I would suggest that we still have a lot of inflation in the system and it is going to get much worse,” Paul said.

    Paul said that economists he follows argue that consumer prices are rising at a 9% clip and that the money supply is rising at a 24% pace.

    “Inflation is exploding and interest rates are going to go up and we are going to have one heck of a problem in the future,” Paul said.

    “There are more people who believe that aliens in Roswell than believe inflation is 1.6%,” said Rep. Steve Pearce (R., N.M.). His district includes the town of Roswell, where a spaceship is rumored to have crashed in 1947.

  72. Ken

    Gary, can you comment on these cycle theories, Peter Eliades 212 week cycle due to resolve about July 4, 2011 (presumably a low??) and Armstrong’s 8.6 year economic confidence model cycle resolution expected around June 13, 2011 (also presumably a low??)
    thanks

  73. Poly

    Bob,

    I would check those facts, I doubt GPL produces 350 million ounces of Silver, LOL. More like 2 million!

    GPL was at $0.60 8 months ago, It’s not a penny stock, but at a $400m market cap after a 400% run, it’s not far from one!

  74. mad

    Poly, I would guess that that type of question is exactly the type of cycles question Gary would like to see less of on the comments – too much info for non-subscribers.

  75. Ken

    I realize the cycles have to do with the stock market, but lets face it, in the last several years the moves in the general stock market have had profound influence on the mining stocks.
    Mining stocks can diverge from gold itself, like during an important stock market low, but I invest in mining shares for the leverage to the metal itself (although that has not been working lately but is typical?) and expect mining companies to have good earnings if gold goes to $1600 or $2000~
    ?

  76. Bob loves Hawaii

    Gary, I agree on allocation, but for me there is a huge difference between an on the come miner and a producer that has a small market cap against their growing production and growing reserves.

    Poly, SLV has no silver, it has as much silver as Social Security trust fund has cash.

    I also own quite a bit of AGQ, so not worried about default, Bernanke will pay off the hedge funds extorting the Comex for March Delivery, we’ll sell off and then we will run hard again into the next delivery month..

  77. Gary

    There is too much risk of dilution or other significant company specific problems for anyone to get heavily involved in these small companies.

  78. Shalom Bernanke

    Although I’d welcome a pullback to add to miners, say over the next week or so, I also won’t be surprised if they have more upside from here. My indicators suggest there is more short term upside even after the huge run we’ve had. Just another day to stand aside and wait patiently.

  79. Ryan

    For the Canadian’s out there, I know we can use HZU instead of AGQ but are there another option on the TSX in replacement for SIL?

  80. Nike Boy2008

    DG,

    I haven’t shorted in a while…got burnt a little shorting S&P in the 1270s and now waiting for Gary’s signal to go short again

    yep..got into a little TBT when you gave that alert yesterday

    Also the little FXP trade you mentioned

    thank you so very much for the alerts

    unfortunately, I’m not as experienced as most of you on this board…I will definitely mention something if I see something

  81. Techperson

    Gary, with all due respect, IF you are willing to do serious DD, you can take out a lot of the risk in a junior miner. I am in PZG with a triple – saw Albert Friedberg go in, and then did the work – and looking for another triple. They’ll file a killer NI 43-101 later this month. Also in OOO.V, the entire team came from Echo Bay and they bought an Echo Bay property. Up only 33% on that one, but there is MUCH more to come. Also GPD.TO, because it and KAM.V are going to be the big remaining Yukon plays, and management has done it before. You have to spend a lot of time looking at maps and core results, and maybe put your feet on the ground, but the rewards are mutiples of what the metal will do. Been all-in on silver and gold for two years, and I subscribed to your service because you are a superb cycles analyst.

  82. DG

    Nike: Please be careful. I did NOT recommend a buy of FXP yesterday. I said IF FXI hits 42.80, then buy FXP and FXI has not gotten there. When I am doing these “stretched rubber band” trades it is important for the rubber band to get fully stretched before we can expect it to snap back. Do not jump the gun. You are probably ahead on your FXP purchase and if so should sell FXP now. You can buy it back cheaper if/when FXI hits 42.80, but I have no opinion about what FXI is going to do here and now. Also—important—these price points are only good for a day or two, so don’t think abut them next week.

  83. DG

    Nike: One other thing—don’t feel you got burned by shorting and thus shy away from shorting. You got burned by being wrong. You can be wrong on the long side as well. The real mistake was shorting a roaring bull market. The very best traders have a hard time doing that, and by your own admission, you are not one of them. Don’t do it. China and Bonds (TLT) are both in bear markets, so shorting makes sense. Different story.

  84. Razvan

    thats so true , never short a strong bull!!

    just look at what happened to MLMT! he got 3rd degree burns from trying to short silver.

  85. T.J. Rand

    Ryan – Waiting for the daily cycle low to add…recognizing that we may not recognize it until after it’s come and gone. But we’re in the timing band.

  86. blammo

    Ryan, I have not been able to find an equivalent to SIL on the TSX so I have basically created a mini fund of miners instead. A little more work but the returns have been better so I think its worth it:

    SLW.to
    FR.to
    GPL.to
    SVM.to
    EXK.to
    AXR.to

    I don’t own PZG.to but will probably buy some soon.

    You need to monitor position sizing as per Gary’s reco but you can easily build up 25-30% of your account with the above (not including SLW).

    I also own MMP-UN.to which is a dividend paying (15%!) gold trust and I variety of gold miners.

  87. Nike Boy2008

    DG,

    Thank you…out of the FXP trade..will wait for complete confirmation from here on out..

    yea…thank you for the kind words about shorting as well..i’ve never been able to make much money shorting..I need to be careful and start getting better at it.

  88. Ryan

    Thanks guys, I’m still trying to understand what a swing low/high and daily cycle low means. I don’t think I’ll know how to spot it, I’m sure Gary will issue an alert or something so I’ll just wait until then.

    Blammo, thanks I was also considering doing that as well but it might be too much management and complication for me. I guess if I want to keep it simple, I can always change more USD.

  89. Yash

    AGQ

    151.94
    144.01
    185.35
    162.63
    197.80

    1,3,5 wave respectively 35.17,41.35,35.17

    todays high 50c more.

    of course these ratios may mean nothing for 2x etf plus in C wave. But if there is swing high for daily cycle then this seems to be good spot.
    Retracement may be up to 168 or so which will be still above big one day selloff low.

  90. fubsy_cooter

    You know what I would love right about now? I nice bull flag. Or a rocket higher into a nice bull flag. Whatever, as long as it comes with a nice bull flag.

  91. Slumdog

    Gold closed Feb with a major monthly reversal signal. Yesterday and today, it traded a monthly double top.

    The market is now set for either a significant fall, to comply with the reversal, or a retest of the double top.

    Historically when what we’re seeing happens, there are these pull backs and pass throughs until finally the prior top, 1434.8, is a meaningless number.

    Currently, we are trading at the prior top, 1434.4.

    IMO, this last few hour drop has cleaned out the weakhanded tight stopped traders (goodbye!).

    I still hope the uptrend will continue (the one Gary refers to). If so, we will see 1540-55 on the top of the first surge up.

    As I’m long, I have a bias. But the market is just now, today, setting up its final line of resistance.

    In a few days, by Monday, we will know what which way the gold market will move, based on this huge reversal now formed. Silver has already made its statement. It’s eaten the attacks against it like a vegan does a bowl of vegetables, interesting, tasty, with the bitter roots just accents enhancing the experience.

    As I’ve said, rejection of the reversal means at least 300 points above 1434.8 and max move of 650 points; and like all of us, we “need” this rise to help us fulfill our material dreams.

  92. DG

    GPL may close in the top half of its range today (midpoint is 4.36). which would be a very good sign. I bought just a little more at 4.09, but that’s it for me. Man do these little suckers move!

  93. Mark

    For those on you interested in an up-and-coming royalty company in the SLW mold focused on gold (the CEO is the ex-CFO of SLW) you might check Sandstorm Gold (SSL.V). Their assets are in politically stable countries (Canada, MX, and Brasil) with sub $500 gold royalty cost, going from 10K oz royalty in early 2011 to 40K oz in 2012. I’ve owned the stock for 15 months. Good corporate presentation on their web site. Do your own DD.

  94. wingman

    Mark,

    I’ve been in it for a few months. Nothing major, but a small position. The one things I worry about is the big float. A lot of shares for a small company. But as you noted, good management and a good and proven business model being executed by those who have already done it before with SLW.

  95. Bob loves Hawaii

    Silverman, I won’t sell GPL until the D wave. They are doubling production from last year until 2012, with increasing reserves, and increasing prices. Their cost to mine silver is very low, meaning profit leverage to price.

    I am adding to on weakness.

  96. Mark

    Wingman,

    I agree on the share float, but they have the right business model and proven management, which are really an important components of a successful junior. I too have a small position, especially compared to SLW…..check out their corporate presentation, and you’ll I’m sure you’ll agree that it’s a nice growth story, especially since you’re a share owner!

  97. mamaloshen

    Mark, Wingman,

    There is another gold junior with a very similar name that I own a modest amount of: Sandspring Resources (SSP.V). It has a promising gold/copper project in Guyana with most of the infrastructure on site. The chart is interesting–seems to be putting in the right shoulder of an H&S pattern and seems to be breaking up. I’m not competent enough to interpret drilling results but respect the management. Don’t know whether you’ve heard of that one.

  98. kmisak

    Silverman, I second Bob Loves Hawaii on the GPR sale. As long as this c-wave continues and investors see the appreciation in sp, there will be volume and momentum.

    It is my biggest holding – now 24.7%, so Gary would slap me upside the head if he read this! I have bias, as it was the first silver miner I bought, in early 2009. man, there were some frustrating months, but it is paying off handsomely now! πŸ˜€

    Someone on the last thread referred to the electrum they found; they mentioned it once in the body of a press release ages ago, but never again. I ask: how much electrum?! :O

  99. kmisak

    Gary, I want you to know that I really appreciated the advice you gave me re: junior miners. I have followed your advice inasmuch as HZU, non-existant in my account a month ago, is now my #2 holding. I have decided to be a little risky, however, with GPR and small holdings of a few others. You yourself have a few (though how you can’t look at them for months is beyond me!).I can’t help it! I’ve got the junior miner bug!

  100. Peter

    Gary, FYI, I read this on SOH website … it was in the comments section

    Tim Knight(click for details)Trading idea: buy GLD.

    Opened at 140.36 on 3/2/11 9:01AM, closed at 140.37 at 9:38AM.

    I think I’m finally seeing the light on this. Gary Savage is a genius.

  101. Clarkatroid

    gary

    whats your plan if you mis-time the c-wave top @ circa 1650 and we jettison all positions to see gold rocket to 2000?

    nice radio interview btw

  102. Bede

    Clark,

    Gary always says he exits too early, so just set your stops at his exits and let your winners run.

    πŸ˜‰

  103. Robert

    Gary,

    What, if possible, would you estimate your whole subscriber pool is invested based on your lead? $50 million? That’d be $20,000 avg. with 2500 subscribers. That might be conservative, right?

  104. Power Corrupts

    David Kafrick,

    Surely Warren understands that one person owning all the world’s gold would have a corner on the market!

    Reference the Panic of 1893. I guess even he’s not old enough to have been around for that one…

  105. Jayhawk

    Yes, I’ve thought of that before…There’s a thread on Kitco where they all look for the penny junior mining stocks. You have to think with thinly traded stuff groups like this with many worldwide viewing the trades as well as Inflation.us pumping junior penny stocks move those markets big time.

    GPL is getting a lot of hype out there in the trading blog world. (Along with EXK, AG, SVM)

  106. David Kafrick

    Reminiscences of the late stages of the Nasdaq bull market keeping popping up in my head as I read the comments.

    I tend to think this will end much sooner than Gary predicts

  107. Gary

    David,
    You are reading comments from a gold trading blog of people who are invested in the trade.

    This will end when half of your neighbors start talking like this.

  108. pimaCanyon

    Gary,

    The “end” that you’re talking about (where half your neighbors are trading PM’s) is the end of the PM bull, right? Not the end of the current C wave.

    The bull may run for another 4 to 8 years, right? 2016 to 2020?

  109. Avann

    David, I agree with Gary on this. I remember the tech bubble … everyone was infatuated by it. Stocks went from $2 to $30 in the blink of an eye. When I tell friends of gold and silver today they think I’m crazy until they follow it for a few weeks/months and then they think they’ve missed it. The bottom line … most people have no clue what’s going on with precious metals … until someone points it out and even then they don’t buy into it.

  110. David

    Keep in mind that there are only a handful of regular posters on this board.

    At the top of the PM bubble, you will see MUCH more interest in PM investing.

  111. David

    It actually amazes me how disinterested people are in PMs, even after a 10-year superbull market.

    PM’s are considered somewhat disreputable even now. When I tell people I’m invested in gold, they look at me like I’m crazy. It’s not considered respectable. You will find that most people are willing to invest in something only when everyone around them is doing the same.

    Interestingly, I think people are more willing to invest in an asset class after a bull market is already over.

  112. David Kafrick

    Gary´s estimate of 2018 would mean that today would be the equivalent of 1993 in the Nasdaq bull market. I would say we are more likely to be in 1998 or so.

  113. David Kafrick

    I find it very unlikely that in 1993 there were thousands of people who knew almost nothing about the financial markets leveraging themselves up to buy penny stocks.

  114. kmisak

    Notice that the dollar properly broke 76.88 today; the earlier break was of the just barely variety, but this is confirmation.

  115. David

    I would say 1996.

    But keep in mind that the bull market will top at the same time that the secular bear in stocks end. If this is true, stocks have a lot of work to do on the downside before they revert to the mean. Ten years on, they are still overvalued. This may be a twenty-year bear, which would equate to a twenty-year bull in gold.

  116. Gary

    David,
    We need to have our LTCM moment before the third bubble stage can begin.

    Bull markets unfold in three phases with major counter trend moves separating each phase. My best guess is the next 8 year cycle low will separate the second phase of this bull from the third and final bubble stage.

  117. Gary

    Actually penny stock volumes are still rather mild compared to prior bull market tops. pretty much in neutral range at this point.

  118. Gary

    David,
    I’ve said this many times. Human nature tends to go to extremes. This not only applies in the shorter term but also to the very large multi decade cycles.

    The 30’s cycle went from a Dow:gold ratio of 20:1 down to 2:1.

    The next cycle in the 70’s and 80’s went from 28:1 down to 1:1.

    This current cycle started at the extremely stretched level of 45:1. If human nature hasn’t changed, and I don’t think it has, then we should see the ratio drop to 1:1 or even .80:1 with gold being briefly more expensive than the Dow.

    We can talk about a final top when we get near those levels.

  119. David Kafrick

    I see no logic behind the Dow:Gold ratio needing to get to 1, simply becuase the Dow is made up of productive companies that create value. I understand that throughout history we should see the dow:gold ratio oscillate between extremes, as gold and the stock market go through bull markets and bear markets, but still, there should be an uptrend in this ratio, simply because we are more productive citizens than we were 50 years ago. And 100 years from now we will be more productive than we are now.

    So even considering that gold is an asset that maintains its purchasing power, throughout the decades 1 ounce of gold should buy less % of the Dow.

  120. Gary

    This doesn’t have anything to do with productivity. This has to do with extreme levels of over and undervaluation. In 2000 stocks reached crazy levels of over valuation and gold got stupid cheap.

    That process has to reverse. We also have a monster debt spiral developing that will fundamentally drive the gold bull as the government tries to print away it’s unsustainable debt burden.

  121. Avann

    I have a friend … now remember I’m up in Canada where we still have not had the real estate fall out that all you Americans have had … he has a bit of money so I told him he should think of putting some into PM’s … he tells me noway … he’s gonna buy some real estate and make a fortune!
    HAHAHA I say Good luck …

  122. DG

    I was with a group of guys last night (friends of a friend so people I do not know well.) At one point I mentioned, “Hey, gold close at an all time high today.” I like to do that to see the reaction. No one cared at all. I then said I thought silver was even better and one guy asked, “Where is that now about $25/ounce?” Not one person knew anything or cared. We have a long way to go!

  123. David Kafrick

    I understand the overvaluation and undervaluation argument, and I am not denying that the ratio will oscillate to both extremes. All I am saying is that the center of gravity of this oscillation is trending up. So the equivalent of a dow:gold ratio of 1 in the 30`s should be a higher number nowadays.

  124. David

    I have a friend who is a private banker in Luxembourg for wealthy clients. Some of his clients are extremely interested in gold, but he doesn’t understand it. The concept is farther along in Europe because of their history.

    So far, in this country the only people with any interest are big money private investors and Glenn Beck-watching crackpots.

    Everyone else is utterly disinterested.

  125. Brian

    Thanks Jay, they were out of the money, so any stalling, flag building, etc was going to kill them off.

    Silverman, Hopefully you are a sub of Gary’s. When he calls the top, I will exit with him. The problem with setting stops is that the initial downdraft will probably blow right through. I would rather sell in control instead of a panic exit.

  126. David Kafrick

    Gary,

    There is another argument for the bull being over before 2018… If it does last until 2018, you would probably have 1 million subs, and I don´t think that´s a realistic situation πŸ™‚

  127. Avann

    And these people who are so oblivious to what is happening are middle aged well educated professionals with a good amount of cash to invest … not one of them has any invested in precious metals. Most of my friends and associates don’t even manage their own money. They leave it all up to a financial advisor to decide.
    Well … good luck with that too.

  128. Avann

    Now I do realize that we all are using Gary as our financial advisor BUT I think we all decided on precious metals and then found Gary … not the other way around.

  129. Brian

    I travel quite a lot, and I bring up PM’s all the time. Rarely do I run into an owner. My trader friends will buy a PM stock if I tell them it is getting ready to move, but they don’t buy the bull mkt yet.

  130. Brian

    Avann, It was the other way around for me. Prior to finding Gary’s blog, I didn’t really understand what was happening and why.

  131. dallascfp

    Other way around for me too. I never invested in Metals until I found Gary. The money he made for us, I cannot Thank him enough.

  132. Jayhawk

    I’ve been pounding the PM trade since 2009 with my parents, inlaws, other family, etc. I had my dad read a couple books, sent him articles, interviews, etc. Nothing…Deer in headlights for both my parents and inlaws.

    My dad emails me back in Dec and tells me he’s buying gold. Also forced his financial advisor to get him into the TGLDX fund. The FA agreed to do it after crapping on gold for years. He pretty much bought the top of the last intermediate top. πŸ˜› Should have asked me…LMAO. Unfortunately, it’s only about 4-5% of my old man’s net worth. He’s in “safe” things like CDs, bonds, banks, you name it.

    My inlaws had about 20% of their capital in the market, garbage positions from their old broker. I convinced them to let me manage this and put the money into a hedge against their large bond position. They are actually starting to wake up to what might be happening to the dollar. So I got them in last month and they are thrilled with how well it’s doing. Slowly but surely I’m seeing some people come in…But even on some of the trading blogs out there, all you see is a piece of their trade will go into a PM stock.

  133. Jayhawk

    Brian-

    I let me SLW and SLV March calls go today too…I want to put more calls for the later part of the C-wave. What are you doing with your option strategy moving forward?

  134. Razvan

    when the D wave hits and we drop 50% do you think people will be jumping up and down to get into PMs??

    Do you think most people know what D wave means??

    its going to take a lot more time and price appreciation to build the euphoria necessary to form the bubble

  135. Chicken Burrito

    I’ve got 2 hard core gold/silver friends. I’ve tried to mentally prepare them for a large move up followed by a large move down. Neither wants to sell anything and both are not buying the possibility of a larger scale sell off. I can tell you that for folks like these, it’s going to really do some damage to the sentiment/psychology.

  136. Brian

    Jay, Those SLW’s were the only front month I had. All the rest are June, and I bought them all as we approached that intermediate low. ANV, CDE, EXK, HL, MVG, SLW, SVM.

    I only buy them with 2 to 3% of portfolio, but if this leg goes according to plan, the returns on these will dwarf anything else I own. Last time ANV’s returned 3,000%. SLW’s 1,500%.

    My basic strategy is to buy 1 strike out of the money at the bottom, so they are all very quickly in the money, as they all are now. For instance my SVM’s are June 10’s. The reason for that 1 strike out is to get in as cheaply as possible.

  137. catbird

    Question about margin:

    Early last month when I re-entered with 130% leverage, I obviously borrowed a dollar amount on margin equal to 30% of my equity. Iow, let’s say I had $100k cash in AGQ and SLW. I borrowed $30k from my broker to buy more shares.

    Well, as AGQ and SLW have appreciated handsomely, that $30,000 I borrowed now represents much less than 30% of my equity. I take it that I can now borrow more (to get back to 130% leveraged) without being a cowboy?

    This is my plan when we get something resembling a daily cycle low.

  138. Slumdog

    vuvvy said…

    When I look at the monthly chart of gold, i see a picture perfect bull flag that is breaking out to the upside.

    SD: PC, thx for answering TJ.
    We are at the prior high 1434.10. My study of the S&P, another market of “all of us”, which I think like gold, is not manipulated other than by TPTB, and that’s now I think history, shows we can wave back and forth through this prior high a few times, this being the 3rd time, now, and in a day or two, the market will make up its mind.

    What vuvvy sees, I don’t see as I don’t trust what I see unless I know it via backtesting and then studying the probability of every move within that backtest.

    For me, it’s very difficult to be long, though I am, now. I read Gary and so want to believe. But unless I see a pattern which has been studied down to the probability based on angle of movement, length of movement, and probability based on move away from the starting point, I’m just plain scared.

    When we see 1460 after everyone’s jumping off this thing awaiting a D move, I’ll probably be much more likely to sit there, lump on a log on part of my position because I believe the move will stretch to 1535-55.

    Then I’ll be concerned about a retracement and will then judge whether I leave part and wait for a fig retracement.

    Silver, for me, is vicious in its movement. I don’t understand it, and it’s whipped me every time I’ve entered. As I’m in the futures market, I’m leveraged enough. I’ll wait in gold for my returns, about 10 X on the money. Then, that’s all she wrote as the rest is hen’s teeth until the next time, and I may be part of a clay pot by then.

  139. Slumdog

    CB, look at the monthly chart in gold.

    Can you read charts? If so, based on what you know, do you see any pattern you recognize, through February?

  140. wmp

    Friday’s jobs number will be good…at least until they revise it lower next month. Talk about conspiracies.

  141. Gary

    FWIW it appears to be a three month consolidation to allow the 200 DMA to catch up. It’s now trying to break out of the consolidation.

  142. Gary

    It’s been bad almost every month for the last 6. I doubt this one will be any different. I’ve always said the Fed wouldn’t be able to create jobs by printing money.

  143. Rebecca

    Good article on the effect (correlation) of FED printing on (with) the general stock and PM market. It compliments Gary’s cycle analysis with fundamental analysis and other economic indicators. It agrees with Gary on high oil price as the chocking point for economic growth, therefor a catalysis for the next leg down in the stock market.

    Money Will Always Find a Home
    by Chris Puplava

    http://www.financialsense.com/contributors/chris-puplava/money-will-always-find-a-home

  144. TZ(5288)

    GARY,

    >We need to have our LTCM moment before the third bubble stage can begin.

    >Bull markets unfold in three phases with major counter trend moves separating each phase. My best guess is the next 8 year cycle low will separate the second phase of this bull from the third and final bubble stage.

    I disagree with this and with the duration you suspect is left in the gold bull for a very specific reason.

    Almost all other bull markets are NOT based on SOMETHING ELSE going DOWN.

    Tech bull was not based on another fiancial sector crashing.

    Real estate was not based on another sector crashing.

    The Nikkei was not based on another sector crashing.

    Etc.

    The gold bull, however, is not a bull “cause it is gold”. It is a bull because PAPER ASSETS, the DOLLAR, and the US GOVT are CRASHING.

    And thus we come to my next point. When markets crash, they do so at least twice as fast as they rise. Sometimes much faster. This is a known fact, not opinion.

    So…the gold bull is not a bull in and of itself. It’s a bull cause false/fake/fiat/paper assets are being recognized, defaulted, sold, and burned. They are DROPPING.

    Thus, the gold bull will happen faster than other bulls which simply rise on their own.

  145. TZ(5288)

    Hemingway once wrote that a man goes broke “slowly, then all at once.”

    The underlying actions that are causing gold to rise are approachig the ‘all at once’ stage. (Although I could still see 2-3 yrs left).

    Who knows. Maybe I’m wrong. Just how I see it.

  146. TZ(5288)

    >I was with a group of guys last night (friends of a friend so people I do not know well.) At one point I mentioned, “Hey, gold close at an all time high today.” I like to do that to see the reaction. No one cared at all. I then said I thought silver was even better and one guy asked, “Where is that now about $25/ounce?” Not one person knew anything or cared. We have a long way to go!

    All of us know two groups of people. (Well, three actually):

    1) in the metals game now (US)
    2) heard the talk from us, but didn’t really care or think it was important or true
    3) no clue whatsoever

    As I see it, at the end of THIS C wave we will all be getting interest, emails, advice seeking, and actual (finally) buying from group #2. Just in time for them to get *CRUSHED* on the D.

    They swear metals off, think it’s over and topped (again..as per typical CNBC) and stay out.

    The next A-D cycle begins.

    Group #2 sorta notices again, sees it climb (again), and realizes they got suckered out. “Damn..it really is shooting up. I shouldn’t have sold!”

    Group #2 buys back in (relatively early) and starts riding higher (making profits).

    This probably goes on for a year or so, then Group #3 finally asks why everybody else is getting rich.

    Group #3 (the dumb money) starts buying in. Things go ballistic.

    The final fuse is lit and we go to whatever high is the ultimate high.

    Group 1 exits (prob too early).
    Group 2 some exit. Some dont.
    Group 3 keeps buying the bag.

    Group 3 and some of Group 2 ride it down. Just like all the other previous bubbles.

    So…keep and eye out for those Group 2 friends of yours perking up in the next few months so you know the top is coming.

    Then the next cycle begins

  147. TZ(5288)

    The only question I dont know in that scenario is whether there are TWO A-D cycles left after we peak shortly or just one.

    My story illustrated just one.

    But maybe psychology needs two so that group 3 buys in, get’s crushed, realizes they got ripped, see’s it climb again, chases it and buys and says (*critically) ” no WAY i’m gonna fall for a dip and sell out AGAIN “.

    That last temperment is usually necessary to lock them in to the downside. And if there is only one cycle left it might not be enough to train them for that.

  148. Techperson

    http://www.marketwatch.com/story/what-is-golds-climb-really-telling-us-2011-03-03

    March 3, 2011, 2:21 a.m. EST
    What is gold telling us?
    Commentary: Gold’s gains may have meaning beyond the market

    By Peter Brimelow, MarketWatch
    NEW YORK (MarketWatch) — Gold reaches a record high. Is it telling us something?
    Gold closed $1437.70 on Wednesday, using the CME April contract as the measure, up $28.40 so far this week and breaking through significant technical barriers.
    Over the weekend, Australia’s The Privateer had growled: “Just as it has since early November 2010, the area between $1,400 and $1,425 is proving a firm ‘ceiling’ for gold.”
    The Gartman Letter was more direct on Tuesday: “Someone … or something … has kept a virtual lid on the gold market at or near $1,414-$1,416 for the past many months and has certainly been at work for the past two weeks making certain that gold does not push upward through that level.”

    Consequently the new, adjusted gold chart looks very exciting. Pring Research put out an early Weekly Infomovie Report on Wednesday morning, saying of the (for practical purposes identical to gold) SPDR Gold Trust ETF (GLD) chart: “The break-out is likely to be a valid one. That’s important because these consolidation formations are typically followed by price moves far in excess of that suggested by their size.”

    The Aden Forecast’s Wednesday evening Weekly Update has swung entirely positive: “Now that gold is hitting new highs, it’s still to be seen if this is really the start of an A rise or an extended C rise. In either case, it’s very bullish.” (Last week the Aden Forecast was still entertaining the possibility that gold remained in the undesirable “D” decline phase.)

    Can gold go further? MarketVane’s Bullish Consensus appears to say yes. On Wednesday gold rose to a 2011 high of 80% but the previous night a LeMetropoleCafe correspondent pointed out that, prior to the 2008 crash, tops generally involved several days in the 90s. Mark Hulbert’s HGNSI appeared to support this optimism. ( See Mark Hulbert’s March 2 column. — but after Wednesday’s action, HGNSI jumped very dramatically, to 71.9% vs. a record high of 89.58%, which will certainly disturb contrarians.)

    What is going on? Obviously, the Middle East and the oil squeeze have to be considered. But two (hopefully) longer-term factors also command attention.

    News of a recent stunning acceleration in Chinese imports is spreading. ( See Feb. 7 column.) This week UBS published a report saying China imported 200 metric tonnes of gold in the first two months of this year, which suggests an astonishing and bullish restructuring of the physical market.

    Possibly more important are signs of a dramatic slump in confidence in U.S. economic management. Symptomatic of this is the normally somewhat-deferential Gartman Letter.

    Discussing Fed Chairman Bernanke’s Tuesday Congressional testimony Dennis Gartman complained of “what we consider to have been one of the worst performances by an American central banker before a congressional delegation that we can remember … but then again we’ve only a memory going back to the days of William McChesney Martin, so our pool from which to draw is limited.”

    “The Fed Chairman seemed all too willing to write off the current global price increases of food and energy as simply the result of exogenous market circumstances. … We have heretofore been overt and very consistent defenders of the Fed and of Dr. Bernanke … but the Fed chairman’s denigration of the problems attendant to rising food and energy yesterday caught us off guard, as it apparently caught everyone else off guard also. It was within a few minutes of his discussion that gold prices soared. They should have. They responded properly and they responded well.”

    It’s not just Middle Eastern turmoil that is alarmingly reminiscent of the late 1970s!

  149. David Kafrick

    TZ,

    WHat you said about a bear market in the Dollar is actually not true. Currency markets are different than the stock market and most futures markets. In currency markets, people are always long a certain currency and short the other currency since they are always traded in pairs. So the moves in the currency markets are very simetric. There is always a long position in both sides of the market.

    So this is not really a bear market in the Dollar, you could see it as a bull market in the Euro, the Yen, the Australian Dollar and other currencies.

  150. David Kafrick

    Just one more thing: The moves in the currency markets are very different than all other asset classes. You can´t compare a bull market in stocks or gold to an uptrend in the Euro/Dollar exchange rate.

  151. Gary

    David has that right. All currencies are being debased. Right now the dollar is being debased the fastest by the second round of QE. So it’s falling against all other currencies. But gold is rising in all currencies.

  152. Slumdog

    Gold continues to trade above and below the 1434.10 prior high.

    This I suspect will continue for another day or two or even a week. This game of repeated failed breakouts was played just about 30 days ago. We humans have lousy emotional memories. We fall for the same joke every time. Expect nothing to transpire for the day other than pain for all those who think it’s going to take off, either way, imo. DYODD

  153. Chrys

    Gary – do you have any idea why gold miners (GDX) are laggards compared to the metal? Gold is at it’s previous high whereas GDX is well below it last high.

  154. Brian

    TZ, I like hearing other opinions, but it sure is hard to argue against somebody who has their finger so firmly on the pulse of this action.

    Clearly the action of the world wide central banks could explain why this bull will stretch past what you envision.

  155. vuvvy

    Slumdog, I think it’s very healthy action to back and fill around an important high before breaking through.I just don’t want to see a big solid red candle here on expanding volume. A nice sideways drift here with maybe a violent spike down that is quickly recovered is just what the dr has ordered for gold bulls hopefully:)

  156. Brian

    Jay, I realized I didn’t properly answer your question last night! I don’t have any options strategy going forward. I usually try to restrict option purchases to as close to a sure thing as I can. I will most like just put that money in AGQ tomorrow or soon thereafter.

    If you have some great ideas let me know!

  157. Gary

    Folks how many times have we seen technical analysis completely fail during this bull?

    Trying to make the charts do what you want them to do is a complete waste of time in thin markets like gold and especially silver.

    Just stick with cycles and sentiment.

    Right now gold is due for a pullback into a cycle low and sentiment is dead neutral.

    There is no right or wrong amount for a cycle low other than it shouldn’t drop below the prior cycle low if we are in an uptrend.

    I think we can say with confidence there is very little chance of that happening since the prior low occurred at $1307.

  158. David Kafrick

    If this is a real breakout in the Euro, then we should see 2 or 3 more days of follow through, which means 2 or 3 days of downside on the dollar before any significant rally.

  159. Gary

    Yes the dollar is playing out exactly as expected.

    And all those who have been looking for a pullback to enter or add should get it soon. Gold has formed a swing high. We will look for a swing low next week as the marker for the bottom of the minor profit taking event.

  160. sophia

    Gary,

    I need help anlysing this… If the ECB threatens to hike,EUR/USD goes to 1.42-1.45, but is Gold not supposed to move down then as Central Banks are taking care of the inflation?

  161. Gary

    Sophia,
    Gold is due for a minor profit taking correction. The market can use any excuse for that to start, even one that makes absolutely no sense.

  162. Pseudopersona

    If there is going to be a week of profit taking does it make sense to rebalance portfolios heavy on AGQ to heavier on something that won’t fall as fast?

  163. Poly

    Seems fairly obvious that we’re going to head into the gold cycle low in the next 1-3 days. In light of the run up to date, where we are in the cycle and the gold non-confirmation with the dollar drop this morning, more than seals the deal, IMO.

    Prepare the cannon’s, it’s almost time to enter with all you can handle!

  164. RA

    With that announcement out of Europe, who knows, we could get a swing low in gold tomorrow immediately following the swing high today!

  165. TommyD

    I took profit in my miners PAAS, GPL and SVM early yesterday morning. Now I have money to deploy in AGQ on today’s possible pullback. Or, wait and see how the market sells today.

    I kept only 1 miner, First Majestic (AG). Look at the BoW volume yesterday. It’s been a great one for me but it looks like more could come?? I wonder if that’s a buyout candidate??? If it is they will just have to buy me out! πŸ™‚

    Now if the DOW and S&P should take a dump, miners will be hit too, initially anyway. That’s what spooked to out yesterday to, not core, but to readjust a bit.

    FWIT,Tom

  166. Gary

    Bob,
    I’ll answer that in the nightly report when the time comes.

    Traderlady,
    Not much chance of that.

    P,
    If you know for sure a correction is impending you could take that action. Are you 100% sure a correction is coming? I’m not.

  167. Poly

    Gary,

    It would be buying, not selling. SO as you like to say, buying early would be corrected by the bull πŸ™‚

  168. Shalom Bernanke

    This sharp runup in metals and miners will not die easily, IMO. Although possible, I’m not expecting a significant pullback.

    I’m prepared to add at lower prices if they should come, or current prices if they churn around here for a few days.

  169. pimaCanyon

    David K,

    I think TZ’s point is that the gold bull is occurring because ALL fiat currencies are going in the toilet. The dollar is making its way lower now, but in a couple of months it will be the Euro.

    So the whole basket of fiat is crashing, going to zero.

    We’ve never seen this before–all the countries of the world being on fiat and floating against each other. And they are all debasing their currencies, so they are all moving toward zero and accelerating.

    As the acceleration towards worthless continues, gold and other real assets will “rise” in value.

    Simple concept. But the point is it’s not just the dollar, it’s the whole basket of paper crap that is becoming worthless.

  170. Shalom Bernanke

    traderlady,

    But that is the pic of the guy who’s going to make you rich by printing!

    Besides, it’s the best one I could find, most of the others I look stressed with big bags under my eyes.

  171. pimaCanyon

    Question of the Day:

    How low will gold go (assuming this is a daily cycle low in the making)?

    I want to add a bit here. Probably some deep in the money GLD calls.

    SB, you adding today?

    DG? Jayhawk? Poly? the Davids?

  172. Poly

    Pima,

    Who knows right πŸ™‚

    I would think it’s going to be at least a 2 day event.
    Looking at similar daily lows within the final intermediate cycles of each C-Wave top, there wasn’t much of a low! Looks like each daily low gave back around 2-3%.

    If this cycle follows suit, we could potentially see $1,400 providing strong resistance and it would be a significant enough drop to mark a clear bottom. I’m personally going to add my final powder at or around $1,400, which we might only get on a sharp intra-day drop.

    What do you think?

  173. Shalom Bernanke

    Pima,

    I’ll let you know if I do, but it’s unlikely at this point. Miners look like they might go a bit lower, but I’m not even convinced of that as yet. Definitely well bid.

    I’d like to see the $HUI trade down to 553 or so, and I might start there, but roughly 537 even better on pullback. Like I mentioned earlier, we must be prepared to buy at these prices too, if they just hang here a few days with little retracement.

  174. DG

    Nike: You have a nice profit on the TBT trade I posted yesterday. I have no target but will post when I sell it. I am tempted to let it run for a bit as I am bearish on Treasurys, and in bear markets surprises come to the down side.

    Pima: No idea where gold bottoms.

    TraderLady: My short or long calls often don’t last long. If you see one that appeals to you, it’s best to pull the trigger right away. Sorry you missed TBT.

  175. Shalom Bernanke

    No matter what, our buys will not be perfect and we’ll have to live with ’em. the important thing is not to lose your current positions. The only decision is when and and how much to buy.

  176. pimaCanyon

    Thanks ddn, Poly, SB, and DG, for replying to my question of the day.

    It does seem early to add and it is likely that the daily cycle low event will last more than one day. However, I remember of a couple of daily cycle lows during the runup after the July low and they were very brief pullbacks–you blinked and you missed ’em.

    Maybe I nibble a little today then wait a day or two for the final nibble. (I’m close to full position, so this is just adding a little gravy to the mix.)

    Poly, I know you dabble in out of the money options. What do you think of the May GLD calls slightly out of the money?

  177. TommyD

    All,
    Zero Hedge posted about possible action in the middle east this weekend. What affects can be guessed and would an event like 911 totally blow cycles and daily counts out of the water?

  178. David Kafrick

    1410 sees like a good area to buy.

    What I don´t want to see is gold taking out 1390 without retracing as much as 15 points or so in the process. That would be really bearish.

  179. David Kafrick

    I think the key here is to watch the Euro. If it reverses today´s gains and ends the day in the red, that would be extremely bearish for the Euro. I really don´t want to see that.

  180. Brian

    Personally I think this is just a stop running event for all the breakouts that happened this week. The SLW intra-day chart speaks to that pretty clearly so far.

  181. Tudor

    Does anybody subscribe to the Coffin brother’s Hard Rock Advisory newsletter? I’m thinking about using some of the profits from riding this C-wave to get a bit of exposure to the up and coming Yukon mining plays and need to find some quality analysis of the prospects. I’d appreciate some opinions regarding their service or suggestions for others.

  182. Poly

    Pima,

    OTM calls respond really well (both ways) to extreme volatility and I love adding OTM calls at the bottom of a sharp intra day move. You could pick up relative bargains right at the bottom, but obviously it has plenty of risk.

    The goal is to get them after a 2-3 day decline and on the heels of that final drop into the daily low. But you need a solid target, a lot of faith and conviction. Catching that bottom almost immediately rewards you with a massive gain.

    Obviously if that low never holds, these options go from slight to deep OTM, so size is very important.

    I’m not sure about GLD options here. If you’re going to take the risk and play Gary’s C-Wave expectations, the SLV OTM have tremendous upside potential.

  183. Gary

    There’s no need to guess at a bottom. Just wait for the swing low.

    The only thing that would be really bearish is if gold dropped back below $1307. Anything above that and the pattern of higher highs and higher lows is intact.

    Trying to attache a specific number to the metals market isn’t going to do anything except cause you to freak out if it’s hit and prevent you from buying into the correction.

    Concentrate on cycles and sentiment here and you will be fine. Revert back to TA and the bull will shake you off.

  184. pimaCanyon

    Thanks, Gary.

    Yeah, 1307 would be a BIG drop from here and would be very scary. Let’s hope this pullback turns out to be a daily cycle low and doesn’t drop gold below 1400.

  185. Avann

    Gary, I’m not sure about others here but I know I would have a very difficult time holding on all the way back to 1350 let alone 1307.
    Let’s hope it doesn’t come to that.

  186. Gary

    If this does turn into a daily cycle low we can probably plan on a move below $1400. Big money knows there is a ton of stops right below there. They will try to run them to get you to cough up your shares.

    You can either think and act like a shark or you can get eaten as chum.

    You decide.

  187. vuvvy

    Gary, you’ll probably be proven right about the sub 1400 gold. My system seems to give buys and sells near the cycle lows and the current stop for this long trade from 1340’s is at 1394.7 currently,moving up each day.In strong upmoves,especially the initial upmoves like we’re hopefully in right now, the short signal in many cases is the exact day of bottom so I will be watching closely.

  188. DG

    David K (and others): When Gary says “Technical” he means “Charts.” I have suggested several times he use the word the way everyone other analyst does, but he just doesn’t. It has led to confusion in the past so I thought I’d clear that up, especially for newer people. Most of the world refers to “fundamental analysis” and “TA”. Cycles are obviously a part of TA, but Gary reserves the use of the term TA to mean just “charts.”

  189. fat boy

    i think i’ll just wait for the call to add from Gary
    I have no hard stops set and probably good or I would have puked and lost by now

  190. DG

    Vuvvy: Two questions: You wrote

    My system seems to give buys and sells near the cycle lows and the current stop for this long trade from 1340’s is at 1394.7 currently,moving up each day.In strong upmoves,especially the initial upmoves like we’re hopefully in right now, the short signal in many cases is the exact day of bottom so I will be watching closely.

    First, the stop is 1394.7. Will you do anything if/when that is hit? Second, YOu said “the short signal is the day of the bottom,” What does “”short” mean in this context?

  191. pimaCanyon

    vuvvy,

    similar question as DG’s:

    You wrote: “the short signal in many cases is the exact day of bottom”

    Do you mean that your system will give a signal to go SHORT on the exact day of the bottom? Or was that a typo on your part?

  192. Jayhawk

    I really like how the 10 & 20 on silver supported silver coming out of last summer’s intermediate. Notice that the 10 was support for 2 months until it broke and the 20 held up.

    Also, the trajectory of this move is much more steep vs. that pretty steady and also steep move. (But this one looks like a blast off).

    Given our expectations, I can’t imagine the 20 getting tagged during this run for a while…Given the sharp move, the dollar low in front of us, the supply issues, etc. Also, we are only one month in so I’m guessing the 10 is the best pull back to use. It would also give a trendline tag. That being said, I’m still all in, but will add some leverage if we get the 10 tag.

    Silver

  193. vuvvy

    No, that was no typo.My trading system is built to always be long or short,although I do have a version where it goes to neutral also but to keep it simple I will give real time long/short signals from original.The short and long signals are computed daily after close of Globex, and a peculiarity of it(and maybe others use a similar system with orders close to mine providing a good place to run stops?)is that in large moves many times the sell/short orders are the exact day of the bottom.If we have a washout day and the system sellsI may start scaling into increased leverage with a very tight stop at that days bottom and finish buying when the system reverts to a buy.An example of this exact situation happened 9/10/2010 when my system took long profits and went short at 1246 and 2 days later flipped back to a long at 1265.

  194. Brian

    Jay, I just added my option winnings to AGQ this morning. Daily cycle bottoms are too tough for me to find, much of the time……..

  195. vuvvy

    BTW, I Will only go long gold using my system but am formulating a plan to short the top of this particular c wave to avoid selling some long term holdings.I haven’t shorted gold since 2006 and caught a huge chunk of that d wave.The sells after long runups are usually good and give a good R/R.

  196. DG

    Jayhawk (or anyone) Your chart shows the 10 DMA on silver at 33.41. I use stockcharts and they show it at 33.01 (see link below). They differ during the whole rally last year where your shows the 10 DMA holding the dips and mine shows multiple violations. I am using the “continuos silver futures” for silver. Does anyone know why we are getting different numbers? Probably different futures quotes (?) I think TZ mentioned something about this once before but it has not mattered to me in the past.

    http://img577.imageshack.us/i/27811662.png/

  197. TZ(5288)

    If we are pulling back, I do not think silver will drop below last thursday’s low. (I’m still grinning ear-to-ear about buying into that. It’s nice when things work out, unlike last fall.)

    I’d say the same about a maximum selloff in gold, which would still allow below 1400 that gary wants.

    Otherwise I’m just holding the futures and waiting.

  198. pimaCanyon

    DG,

    You’ve checked for obvious things like what do they use to calculate the average, close price or high/low/close? What about whether they include AH prices in the calc (which wouldn’t matter if using close price but could affect the calc if high and/or low are included)?

  199. TZ(5288)

    In other words, I don’t see the large selloffs that many of you are talking. 1390 on gold and 32.50 on silver might be the best of it.

  200. DG

    Pima: Obviously something is amiss. Jayhawk uses TD Ameritrade’s platform. Stcockharts prices are different, but since the chart Jay posted holds the price so well, I obviously want to use that one, but have been unable to recreate it. Darn. I will keep looking. Jay: At this point how fast per day is the 10 DMA you show rising?

  201. DG

    Auger: So my 10 DMA is always off by a day and his includes today’s action? I don’t see how his 10 DMA can include today’s action. Is it rolling and based on real time, so 10 days from point to point, not the previous close? Maybe i am being dense here. Thanks!

  202. pimaCanyon

    The most likely channel that /GC has been respecting since the late January low has its lower channel line around 1398 this afternoon and 1401 tomorrow morning. Whether /GC will tag that lower channel line on this drop is anybody’s guess, though.

  203. pimaCanyon

    The bad news with regard to channels is that the channel that GLD has been in since the late January low has its lower channel line around 134.50 which corresponds to a gold price of around 1380.

  204. pimaCanyon

    One last comment re the current drop and where it might end up, and then I will shut up for a while:

    From an EW perspective, a likely place for the drop to end would be between 1384 and 1392.

  205. Sasa

    Interesting video i found linked on Ed Steer’s blog:

    http://www.youtube.com/watch?v=sR28o5f9aKE

    Guy compares owning SLV since 2006 if you bought it at NY open and sold at NY close (9:30-16:00) vs. buying at close and selling at open.

    If you own SLV just during NY trading hours, you lost 46%. If you own SLV outside that timeframe you gain 344%.

    I found it interesting, but havent re-checked it myself.

  206. Rebecca

    Hi DG,

    Good question on the slope of the 10 sma. Based on my estimate, the 10 sma for both $Silver and SLV is at ~$0.30 per day; for AGQ the slope is at ~$3.0 per day. The estimate was done over 10 trading days using the average. So in about 2.5 – 2.6 days, the 10 sma of $Silver, SLV and AGQ will catch up with the current price level in the best case scenario of side way consolidation.

  207. Wes

    Poly,

    Are you going to reload on a OTM SLV option during this drawdown ? If so, what are you looking at ?

    I’ve not yet started looking at one.

  208. Razvan

    gold bounced off the 10sma for now.
    DG if you want accurate data then i suggest you get yourself a broker that trades spot metals. All my smas are right on the money!

  209. Gary

    FWIW every daily cycle low since last July has been able to test the 20 day SMA. I don’t know if it will do it again, But if it gets there before a swing is formed that’s where I would take a shot at picking the bottom.

  210. Jayhawk

    DG-

    I’m watching that on ThinkorSwim’s /SI futures chart.

    FYI…Reading this book

    http://www.amazon.com/Trade-Like-ONeil-Disciple-Trading/dp/0470616539

    A point they make regarding the 10 DMA…A “violiation” is not confirmed until the next day…watch the price action that day and if it doesn’t move bellow the prior day’s intraday low, it’s not a 10DMA violation. Plus, these lines are just ballpark zones to watch for how price action responds. Several of the miners tested the 10 last week, some violated it, but the next day they didn’t move under the prior days intraday low and moved up from there. (SVM was one that I saw do this.)

  211. Jayhawk

    Sandy-

    Not sure what I’m doing yet regarding some options positions. Gary said he was going to cover that in an upcoming report. If I do anything, it will be with a small % of my capital as Gary recommends.

    I’m leaning towards slightly out of the money, maybe May or June SLW & SLVs

  212. pimaCanyon

    seems to me there are two types of option plays:

    1) Deep in the money (DIM)
    2) Out of the money (OOM)

    DIM options track nearly one to one against the underlying and have very low premium. DIM options are a way to increase your leverage, especially for stocks/etf’s trading at high $ values per share. For example: You can buy 8 or 10 DIM GLD calls for the same money as buying 100 shares of GLD. If GLD moves up $1, your 8 DIM calls will increase in value by over $7.

    OOM are lotto plays. Higher risk, bu also higher potential reward. The entire price of the option is premium since they are OOM. If the underlying goes down or sideways for days (or weeks), those options will lose money big time. For that reason I do two things with regard to OOM options.
    1) allocate only a small percentage of my capital to OOM options, say less than 5 percent
    2) use expiration dates that are out in the future by at least a couple of months, 3 months is even better.

  213. Tudor

    I asked this morning for feedback on mining newsletters. I’m going to ask just once more because I know folks are busy and the messages can really get flying. If there’s no response, all good and I won’t bring it up again. Thanks.

    “Does anybody subscribe to the Coffin brother’s Hard Rock Advisory newsletter? I’m thinking about using some of the profits from riding this C-wave to get a bit of exposure to the up and coming Yukon mining plays and need to find some quality analysis of the prospects. I’d appreciate some opinions regarding their service or suggestions for others.”

  214. pimaCanyon

    Ben wrote:


    ‘I just added my option winnings…’

    Are you betting at a casino?”

    If he had OOM options and a March or even April exp date, then yeah, I’d say he was betting at a casino. πŸ™‚

    (With Gary’s help stacking the odds in his favor a bit.)

  215. Shalom Bernanke

    I don’t have anything to add regarding other newsletters. Gary’s is the only one I’ve ever subscribed to in 20 years. I did have a mentor early on, but he did not subscribe to anything either, that I can recall.

    Especially as a trader, be careful what you put into your head. πŸ™‚

  216. DG

    David K: The Canadian Dollar just popped up on my short screen. This is a trade not a longer term situation, but how does that fit into your picture on the currencies? Anything interesting here?

  217. Jayhawk

    Tudor-

    Never heard of that one.

    I attempted to ferret out the up and coming juniors, but it all became a huge pain in the butt to me. Especially with the time period we are looking to play. I’m thinking after the D wave we will have some time to scout out some picks. Boblovehawaii’s buddy “wingman” here I guess is pretty astute at picking juniors. There was a thread on Kitco talking about Yukon mining plays, maybe those guys would have insight on that newsletter?

  218. Ben

    Pima, I wrote that partly to harken back to the Nasdaq bubble, but mainly about the sad state of our so-called free market which is so manipulated that it really is just gambling. Heck, I’m gambling just by having my account in the US of A. It seems a sure bet right now, but in ten years… ?

  219. DG

    oa92: Nope. Signals don’t come often. I had posted I expected a new SPX high, but the big down day sent me packing as in my heart I am bearish. More money for AGQ next week without holding SPY’s.

    Bamster: Try FXC for Canadian dollar. I assume it’s against a basket, though.

  220. David

    Tudor,

    I also have never subscribed to any newsletter other than Gary’s.

    I once bought a sample of John Doody’s Gold Stock Analyst re: silver miners. I didn’t find it all that useful.

    I’ve followed Richard Russell, the Adens, etc. but have never found anything actionable in anything they say other than “It’s a bull market. Get long.”
    Adam Hamilton is very interesting in a macro sense, but apparently his picks are not so great. Clive Maund will actively lose you money. I used to follow Thom Calandra, but I don’t know how good he’s been of late.

    Most of the info on the tiny pink-sheet lottery tickets tends to bubble up on the internet anyway. I always check on Kitco’s silver page for the best-performing silver stocks — GPL came to my attention that way.

    The truth is, you don’t have to move too far out on the risk curve to make a fortune in this market.

  221. mamaloshen

    I agree with Gary that it’s not a good idea to short gold or silver when the D wave arrives (as Old Turkey would say, “it’s a bull market after all”).

    However, if the $USD has an explosive move up, would anyone consider shorting the euro or cable? Or another currency like the loonie or Australian dollar (except the latter two seem to be in a bull market of their own). Which currencies do you think will go down the most vs the USD?

    Do any of you futures guys here have any thoughts on this? (I am not based in the USA so this may make more sense for me than shorting US stocks.)

  222. mamaloshen

    Thanks, David, hadn’t thought of that. Of course, shorting a currency on the futures market might outperform even UUP due to the leverage (though it carries more risk).

  223. pimaCanyon

    David,

    Great idea. When 3 year low on Dollar looks to be in, go long UUP and maybe add a bit of leverage with UUP options.

    There may be short opps in stocks then as well. We’ll just have to wait and see what happens to the overall stock market by then.

  224. Sandy

    Silver holding up fairly well given the weakness in gold. I wish it would magnify gold’s move down for few days!

  225. sophia

    Geithner talking to $ up…ah ah ah..and by the way, thanks to Gary, I gathered my strengh and bought eur/usd at 1.3820 …..happy camper today…

  226. David Kafrick

    Mama,

    If you have the possibility of trading futures and/or forex, than I would buy the Dollar/Yen pair when the time is right. I think the dollar/yen will put in a generational bottom this year.

  227. sophia

    I think that the stock market is done and dusted…It has been a long time since the Dax underperformanced like that…And it has been a leader like the Nasdaq since September 2010….

  228. james r

    This would make sense that the miners held up today since last week quite a few of them had a cycle low (if these’s such a thing in miners).

  229. pimaCanyon

    vuvvy,

    It’s actually an ugly RED candle…

    Okay, we’ll call it an ugly red gold candle. :-0

    Yeah, gold and silver both down equal amounts (percentage wise), but miners did pretty well. GDXJ down slightly more than gold, but SIL down about HALF as much as silver.

  230. Razvan

    mamaloshen
    short the new zeeland dollar or the australian dollar vs the US dollar when the D wave comes. The New Zeeland economy is in more trouble then Australia and when the dollar weakness arrives it will fall the most.

  231. mamaloshen

    Thanks, Rob, will look into that.

    David K, thanks for the suggestion. Eyeballing the charts the Canadian dollar seems the most stretched above its 200dma. And if commodities sell off hard that could, too. But Japanese yen cross worth investigating historically.

  232. Ryan

    I wanted to add more to SLW today but missed it and ended up having to chase. Added a bit more EOD hoping for good earnings!

  233. DG

    Intern: I have more to do and don’t mind buying on the way down a bit. I am not at all convinced we are going to drop much more. I just bought 1/3 of what I have left to buy.

  234. mamaloshen

    Razvan, just saw your post, thanks. Will have to look into the cost, margin requirements etc. Just looked at the chart; it’s already weakened vs the US dollar–I suppose partly due to the unfortunate recent earthquake.

  235. T.J. Rand

    With the almost universally positive commentary among media pundits related to PMs, I’m fearful that the daily cycle low might be deeper/longer than we expect…enough to begin to change sentiment. The next few days should tell.

  236. Jayhawk

    In my mind, a deep daily correction doesn’t seem to fit into an epic move unfolding over the next month or so. I could see a brief dip like today and then rocket higher leaving all would be pms longs once again frustrated and chasing this thing. Think last summer’s move. Dips were bought instantly. We will see…

  237. Ryan

    DG, I have the same strategy as you. I still have a bit more to put to work so don’t mind being a bit early. I’m already over weighed on AGQ so decided to take the gamble on SLW.

  238. Ken

    61.8% retracement of the gold move from 1392 to 1441 is about $30, and a $30 move down from the high is 1411.. so I added a little there with stop at 1409.. tight stop! and probably will be stopped out overnight, but that is a very small loss. I can try again at a small break of 1392, say 1388.

  239. Techperson

    Tudor – for reviews of most newsletters, check out http://www.stockgumshoe.com/reviews/

    S&A Research Report is excellent and not expensive, although you will be buried in upsells and cross-sells to their other newsletters. Ignore those.
    http://www.stockgumshoe.com/reviews/s-a-oil-report/

    Top 3 newsletters last year according to Hulbert Financial Digest were Howard Ruff’s Ruff Times, up 86.4% (almost all PM); Jim Dines’ Dines Letter up 76.6% (PM+uranium+rare earths); Michael Murphy’s New World Investor up 37.8% (PM, small tech, small biotech, small energy).

  240. Poly

    I agree with Jawyhawk.

    If this coming daily cycle is the very last (or 2nd last at most) daily cycles for this entire C-Wave move, we should expect a very mild and quick drop into a cycle low, before it rockets out before you can blink.
    I’m going on all of the previous tops as a guide.

  241. DG

    And there is very little bullishness. Rydex traders are at well below normal levels of PM’s and public sentiment is dead neutral. If we are going to get to bullish sentiment extremes and not take six months to do it, we need to start from near neutral, not terrified. Setup looks perfect to me.

  242. kmisak

    Thanks for the idea, Rob. Maybe I’ll buy HDU, too. It was on this blog that another Canadian showed my ignorant ass towards HZU, so I bought ‘n bought it; now I feel I am more in the ‘plan’!

  243. kmisak

    Oh, grrreat. Just what we need is a whole lotta Cotton Tom Heflins runnin’ amuck in the next, scary, generation! Let’s hope the traders have read their history… :0

  244. Ken

    I never get any feedback to anything I say. Perhaps my comments do not go through? Please let me know….

  245. T.J. Rand

    Hope/trust the group is right about a shallow daily cycle low – I’m betting on it.

    DG-
    Are you getting your sentiment reads from Sentiment Trader? I’ve been thinking about subscribing but have been on the fence.

  246. DG

    They’re there Ken. I don’t remember you posting much nor asking questions. I thought the 61.8% comment was interesting but didn’t warrant a response. If you post more people get to know you and different people who look at things the same way wind up communicating.

    By the way all, I’m out next week on a business trip (DC and FL) and will be posting a lot less. Keep ’em up by then so I don’t have to look while I’m away.

  247. DG

    TJ: Yes. He is terrific, but frankly this current environment has him baffled (me too!). We get a billion SPX bulls and just go up anyway. But for raw data he is definitely the best. Has a whole commodities section, and is the guy Gary uses.

  248. Jayhawk

    The Company had record quarterly net earnings, operating cash flows, attributable production and sales, as follows:

    Net earnings more than doubled to US$123.0 million (US$0.35 per share) compared with US$50.8 million (US$0.15 per share) in 2009.
    Operating cash flows increased 76% to US$124.7 million (US$0.36 per share)1 compared with US$71.0 million (US$0.21 per share)1 in 2009.
    Attributable silver equivalent production of 6.3 million ounces (6.1 million ounces of silver and 4,100 ounces of gold), representing an increase of 10% over the comparable period in 2009.
    Silver equivalent sales of 5.7 million ounces (5.5 million ounces of silver and 2,600 ounces of gold), representing an increase of 11% over the comparable period in 2009.
    Total cash costs were US$4.021 per silver equivalent ounce, compared with US$4.041 per ounce in 2009.
    Cash operating margin1 increased 64% compared to 2009, to a record US$22.42 per silver equivalent ounce, while average silver prices over the same period increased by 50%.
    Acquired 3.0 million common shares of Bear Creek Mining Corporation for total consideration of C$19.1 million. At December 31, 2010, Silver Wheaton owned 13.3 million common shares of Bear Creek representing approximately 14% of the outstanding shares on an undiluted basis.

  249. mylifemytrade

    It is funny that people are saying today’s gold decline doesn’t matter much because miners did okay.

    How about look at a slightly bigger time frame (say last 3 months) and see … oh gold is back to new highs… but miners are lagging so badly… Hmm… what is that supposed to imply?

  250. Poly

    The Sep daily cycle low (equivalent to this coming cycle low) shaped up the same way. it was essentially a 3 day event followed by “lights out action”. If Gary is right, my gut tells me the last real opportunity to add is almost upon us.

    Tomorrow could see another big down day and $1,400 stops get taken out and possibly an intra-day reversal to settle just above $1,400. If we get any sharp move below $1,400 I’m going out on a limb and will try to catch it.

    Sure I could wait for a swing, but where is the fun in that? πŸ™‚

  251. Arun

    MLMT.. i guess u do get quite a tickle by posting here. You have a point though abt miners. Although this won’t be a losing trade if they went in with Gary’s entry.

  252. Shalom Bernanke

    It’s funny how mlmt is losing money, while those in miners are up huge. And why would mlmt short metal, when he thinks the miners are the obvious short?

    Let him keep trying to pick up nickels in front of the steamroller. πŸ™‚

  253. blammo

    Muted response to the .05 SLW beat in after hours. Apparently they’re going to pay a .03 divvie? Not sure how the market will like that.

  254. TommyD

    I just got back from the coin dealer. I got 20 silver eagles for $36.75, or 2.55 over today’s close of $34.20.

    Is that good? What’s the average to expect?

    Tom

  255. Josh

    Nobody woke me up.

    Maybe because the market never broke. That’s what happens when Big Spenda steps in and buys 1.4M shares of SLV on a 2-minute bar. That bloke didn’t show up again for the retest at 3:30pm. I wonder if he and his pals like to buy the open?

    Unable to trade while asleep, so no buying for me today. Hoping for better prices tomorrow, but who can say. Should have pushed the stick all the way to Ludicrous Speed last Thursday – then I could have taken a longer nap.

  256. Ryan

    Blammo, regarding SLW earnings report, it does look very up beat minus the dividend news. I guess we’ll have to see what happens tomorrow but looking at the AH action, it looks to be a non-event unfortunately.

  257. TheBookGuy

    Tudor,

    Matt Badaili from Stansberry and Associates is good. David Morgan is good. Others have lost me money, especially Clive Maund. Those guys stay in most of the time. David is about as conservative as it gets.

    Gold and Oil guy didn’t work out for me.

    Gary is by far the best service I’ve ever bought and I’ll be very happy as long as he keeps going! He is incredibly cheap too!

  258. T.J. Rand

    I’m hesitant to post on the topic of potential silver COMEX manipulation given the fairly strident points of view related to it, so given the info that emerged today, I thought it might be useful to simply post a link to tonight’s Harvey Organ report for anyone who is interested.

    http://harveyorgan.blogspot.com/

    The link details the purported results of the purported group of ex-JPM traders who were taking on the COMEX by standing for delivery, hoping to force a cash settlement significantly in excess of spot. (In the link he claims they received an 80% premium to spot, and questions whether spot silver will go above 36 if the COMEX counterparty is willing to settle in cash – for some unknown reason- above $50.)

    The intent is NOT to spin up a discussion of the validity of this (or any) conspiracy, but rather to provide a link for those who are interested.

  259. Poly

    So these righteous traders taking on the big bad corrupt comex and JPM, in the end settled for some cash…….LOL.

  260. Poly

    Sorry if I don’t share in your faith of a one “Wynter_Benton” who is commonly found trolling the Yahoo message board, of all places!

    The post and description of “what went down” is just beyond stupid.

    At some point a lot of “people” are going to be destroyed by this bull, but nothing ever changes.

  261. pimaCanyon

    Arun,

    I have been trying to use channels too. However, theDoc has said that BY DEFINITION a daily cycle low has to break the trendline (which in a rising channel is typically the lower channel line). So if you’re using traditional channels and if we are moving down into a daily cycle low, that lower channel line will get busted and you’ll get stopped out.

    One way to still use channels is draw one off the rising TL formed by the highs and see whether the lower TL would be at a shallower slope than the more normal channel (drawn off the lows).

  262. Aaron

    T.J, Im a believer of manipulation, but that Wynter stuff is just ridiculous!
    That poster is simply an attention seeking idiot.

  263. pimaCanyon

    Poly (or anyone else who has figured out how to do this),

    Were you able to figure out how to block comments from a particular user from appearing on your screen?

    It looks like if you are the blog owner you can block someone from posting, but I don’t see a way to block comments from displaying if I am not the blog owner.

  264. jeff

    brian

    what part of this looks like a d wave? this is in a daily cycle. Gary said this is when it should occur and he said not once in ten years has it failed to bounce out.

  265. n1tro

    Hey SB or those with a sizable physical holding in metals…

    Are you going to sell off your physical when silver gets near $50 or hold it through the D wave?

    Still undecided, would like to know what others are doing. Thanks.

  266. ddn3f

    Nitro,

    DG has said to just short the equivalent amount of GLD or SLV and you should come out even.

    Or you can swap all your silver for gold and hold the gold until the bottom and swap back to silver. That is if you are interested in keeping silver and maintaining a physical stash. That’s my plan.

  267. TheBookGuy

    n1tro,

    I’m in the same dilema. I have a ratio of about 80 to 1 physical vs stocks and the leverage is obviously in the stocks. I’ve decided to sell at least 100k worth of physical…still mulling it over. I’m interested to hear what folks have to say.

  268. ddn3f

    Silver will of course drop less than gold in the D-wave. Also the purist believe that gold is money, that’s why the central banks hold it as a reserve. The central banks do not hold silver.

  269. ddn3f

    Some of the physical people are in the camp, it’s about the number of ounces you have, not the amount of FRN you have. So your wealth increases with the number of ounces/shares you have, not the amount of FRN the ounces are worth.

    Like I said, I like to keep my physical and the paper account separate. Also I think the swapping from gold to silver won’t give you a tax bill. But that’s just my guess.

  270. TheBookGuy

    ddn3f

    I think you mean gold vdrop less than silver right?

    Well, I sort of feel that the number of oz you have matters more than the FRN but if you sell your physical at the top of a wave and buy back at the bottom…you increase your oz.

    That swap is certainly enticing.

  271. DG

    vuvvy: and that “sell” often coincides with a short-term bottom, if I understand your previous post. Is that right?

  272. Keys

    As per physical, from my perspective.

    I am most likely going to buy SLV and GLD puts and enough to hedge out my then current position…most likely at the money, not sure about the time period yet. The premium should equal to what I would qualify as a normal drawdown, something I am not concerned with. Basically the put protection makes a D-wave decline into something I would normally hold through anyways.

    I don’t like the idea of being without a position at anytime. And giving up me pot, really doesn’t sit well in the gut.

    Sell the puts at the bottom(ideally anyways) and buy more pms with the proceeds.

  273. ddn3f

    TheBookGuy,

    Well I believe people buy physical for insurance. If it was profit, then paper accounts are easier and have a narrower spread. So since physical is your insurance, why sell it? Until 2018 or so when Gary tells you to get out of everything.

    Just remember, when the prices drop, premiums get higher. Remember what happened in 2008 with the premiums? I am not sure it will get that bad though.

  274. ddn3f

    Vuvvy,

    Thanks, the 1401 area is around where Gary believes they will run the stops at 1400.

    DG,

    I believe Vuvvy said that the sell signal at 1401 during an intermediate move up usually is near the bottom or a daily cycle. So…buy.

  275. mamaloshen

    ddn3f,

    I’m not a tax accountant, but I think you’re incorrect about the tax consequences of selling silver and switching to gold or vice versa.

    If you sell gold you have a recognised gain or loss (presumably a gain). You would have to report it on Schedule D. If you then bought silver you would have another gain or loss when you sold that. Same consequence if you sold Exxon and “switched” the proceeds into, say, Chevron. You would still have to pay tax on the Exxon sale (if a gain). Uncle Sam doesn’t consider gold or silver as currency, unfortunately.

  276. Ken

    Arun-
    Got your comment, was out a few hours.. Yes, the channel touch AND 61.8% retrace both noticed, I hope we are right!!! The jobs reports always worries me, seems gold usually sells off on a jobs report,, this time perhaps different~

  277. ddn3f

    So I guess either sell it or buy Puts. Maybe when the time comes Gary can make a recommendation on which Puts to buy for those of us that want to hedge physical.

  278. Ken

    Today’s House vote to repeal the $600 1099 reporting requirement was good news!! Senate already passed its repeal and the President has said he would sign. Imagine a 1099 for every oz of gold you sell or buy, paperwork nightmare for thousands of small and large businesses.

  279. vuvvy

    DG, that’s correct. I’ve gone back to every large rise since 2006 and the sell marks lows consistantly.Just remember,trade it at your own risk as always no guarantees.

  280. james r

    Looking at the gold candle stick chart a reversal tomorrow is a very good possibility.

    Maybe the last time to add before the C-wave takes off.

  281. Steven

    I’d like to chime in on the physical decisions. I think it comes down to why one holds the physical in the first place.

    I first looked at my US dollar holdings and placed them into three buckets.

    The first bucket was the amount of money I thought was necessary for my family to exist for a reasonable period of time and I keep this amount in the bank.

    The second bucket was money that went into a brokerage account meant for speculation on the PMs/

    Then came the third bucket, my physical purchases. With this money I purchased quite a bit of physical (75% gold, 25% silver, although the ratios have changed due to the outperformance of silver).

    The physical purchases were NOT meant for speculation purposes rather they were a simple money substitute. Instead of holding dollars I was more comfortable holding gold & silver. Frankly other than a few hard currency countries I was uncomfortable holding it in ANY currency. So I bought physical with this cash.

    It was basically just a cash substitute. The fact that it has gone up so much in the time-frame I bought it (started around $800 in 2008 and just continued to purchase until the end of 2009).

    Now there was one more aspect to my physical purchases and that was insurance against “whatever, and whenever”. I purchased more than I wanted to convert to another currency, so to speak, because I wanted my insurance. So there are two parts here and neither frankly was for speculation. One is a currency substitute and the other insurance.

    For my purposes I think about 75% of my entire physical was a currency substitute although that number has increased since it has appreciated.

    This also affected what I purchased. I bought gold kilo bars, 100oz silver bars and 90% bags (1/2 and full bags). I intend to keep some of the gold kilo bars and about half of the bags (can be used for purchases in the event of a total system collapse) as my insurance policy.

    I don’t think I will ever hedge this amount since I don’t believe one hedges insurance. If the hedge goes against me then yes I don’t lose money but I do lose my insurance. But I’m still thinking this part over.

    As for the remaining amount of my physical (maybe 85% or more) I will sell it all at the top of this C wave and just be left with my insurance. I will keep it in dollars as I expect everything to be in dollars once we come out of the 4 year cycle low. I will keep money in the brokerage account for the A wave.

    I actually may repeat this process again although next time I may just use SLV or GLD as I will already have my physical insurance. It will depend on how comfortable I am feeling with the system at that time.

    So that’s my two cents. I’d appreciate feedback on this strategy.

  282. Steven

    1099 House Bill

    I think the senate has to draft a new bill as the provision was in some larger aviation bill. So it seems like everyone wants to get the 1099 rule repealed but it’s not a done deal yet although it will likely be done before it is ever required which is the beginning of 2012.

  283. Shalom Bernanke

    nitro,

    I won’t sell the physical for several years, and possibly not all my miners before a D-wave. Physical stays, but do some pruning on the miners, looking to add back after a good stretch of the D-wave.

  284. n1tro

    seems wasteful to hold physical at $50/ounce and watch it drop to $30 or below in the D wave when I could cash in and come out more physical for the A wave. Not worried about taxes because what the gov’t don’t know won’t hurt them or me for that matter.

  285. Shalom Bernanke

    n1tro,

    I suppose if physical is most of your invested funds it would be a good idea to let some go at $50/oz. The problem is that silver might trade straight to $60, then pullback to $40, and leave us waiting to buy in again at $30. One thing seems clear, if silver gets to $50, $150 is certainly on the table as well, and I’d like to stay quite long for most of the secular bull.

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