NEARING THE BUY ZONE

Gold is on day 4 of the decline into it’s daily cycle low. On average gold puts in a cycle trough about every 20-30 days. This one has stretched slightly long, no doubt driven by QE2. As a matter of fact almost all cycles have been stretched the last two years by the Fed’s printing activities. Consequently all markets have been swinging wildly between bullish and bearish extremes.

Think of it as a rubber band. The further you stretch it the harder it snaps back once the pressure is released. Gold and especially silver were stretched extremely tight during the last couple of months. Now that the profit taking event is here it is understandably severe simply because the upside was so powerful.

However QE hasn’t ended. So once the correction runs it’s course we should see another massive swing to the upside, again driven by free money and the extremes to which gold moves to the downside. The further the correction goes the more powerful the rebound will be once selling pressure exhausts.

It will also be driven by the many investors and traders that got thrown from the bull during the correction chasing as the metals surge higher out of the cycle bottom.

I’ve noted in the subscriber reports that gold will usually reach certain short term oversold conditions at daily cycle bottoms. We are now getting close to those conditions with this mornings move.

As you can see a daily cycle correction will almost always drive the 5 day RSI into oversold levels before bottoming. We also usually see a tag or penetration of the lower Bollinger band at daily cycle lows. As I write gold is about $1499/$1500. The lower Bollinger band will rise to about $1493 today.


Someone trying to pick a bottom should be fairly close if they buy on a touch of the lower Bollinger band.

Stocks and oil are also moving down into daily cycle lows. Oil especially is very deep in it’s cycle and due for a bottom soon. I would guess it will bottom within a day either way of gold. Oil is slightly ahead of gold and has already moved to short term oversold levels deep enough to form a cycle bottom. I doubt it will drop too much further than $105 and I certainly think buyers will step in at $100.

There is a possibility that gold, stocks and oil will all form a bottom sometime tomorrow on the May jobs report. If the report is weak (which is a strong possibility) we could see a gap down open. If the gap is recovered by the close and especially if the market can close positive we will probably have our cycle low in place.

We would then need to see a swing low on Monday to get the first confirmation that the correction has run it’s course.

461 thoughts on “NEARING THE BUY ZONE

  1. Russell

    Great post Gary,
    As a new subscriber, could you comment again on the timing of the end of a C wave, length of a D wave and what to expect timing and length of an A wave. I’m thinking of GLD options with a long expiration as a conservative play.
    Russ

  2. TZ(8155)

    Bought gold and silver futures here for a BOUNCE. This is NOT a ‘long’ trade and I will be exiting at a target profit shortly.

    I’m still in the “back to core” camp and not playing this (for now) as a contining C.

  3. Greggy_M

    Gary,

    With all the weakness in the markets even I’m surprised the dollar hasn’t risen more? I guess there is major underlying weakness in it.

    If this is a coil and we get a fakeout bounce up to say the 20dma(74.10) how long might that last and will it push metals even lower?

  4. DG

    Gary: I don;t want to beat a dead horse here, but i believe this is important and this is my first response to what you have written. And you said you like a good debate πŸ™‚

    You wrote last night—
    “In hindsight one can say I should have got out at $49. It was so obvious. But in real time that’s pure nonsense. In real time one doesn’t know whether the top is going to occur at $49, $48, $47 or $45”
    If it is that random why did a bunch of us sell between 48.5 and 49.5? Just a lucky coincidence? The answer is because there was an exhaustion candle overnight; the clear sign of a top after a frantic run. Silver blew out up 7% overnight on the China news. The flaw in your statement is that you don’t have to know AHEAD OF TIME whether the top will be 45, 47, or 49, but you have to stay awake and spot a blow out when it occurs. All this “crystal ball” stuff of yours is a red herring. If you reread your statement you’ll see that you changed tenses: “Real time” and “top is going to occur” has one in the present and one in the future. In REAL TIME silver reversed so we sold; no prediction price was ever necessary–no “crystal ball”. You yourself said an exhaustion candle would probably mark the top, yet you rejected it because the bulk of it didn’t happen during NYSE hours. Fine, but saying a group of us cutting back or getting out at the high is a just a big coincidence seems a bit silly to me. Maybe we saw something (?) You picked 50, we picked something else. If 50 had worked would it have been because you had a crystal ball? We each picked intelligent strategies and ours worked; yours didn’t. That makes us “lucky?” You had planned to get out Monday. Why? Was that your crystal ball? How could you know the future? You saw something that spooked you. Well, others can see things as well without being emotional or psychic.

    I think what I am saying is totally clear and compelling and if not persuasive, well, I don’t know what to say. We all have stuff to look at and learn every bad result. Your experience from 2006 changed some tactics of yours. Maybe this will too. You are a great trader and I have no desire whatsoever to bust your chops but, as I said, I think this is too important to let peter out too easily.

    Welcome home, Gary.

  5. muttonfish

    Silver still doesn’t look broken to me. I know Gary doesn’t rely on trendlines, but it still looks like simple (and healthy) backtesting. A year-long trendline incorporating the May 2010 and January 2011 high shows the March cycle low as one backtest on the way up, and this as another.

  6. wmp

    If someone can clarify: IF the jobs report is down, as expected, this will drive the dollar up, and the everything else (PM, oil, S&P) down?

  7. Supermalc

    Gary,

    Clear post as usual, for which, thanks. Thanks too to the wonderful community that is the SMT blog. As a very recent newbie sub I have learnt a lot since first investing April 12th. I have also laughed so hard my head has fallen off my shoulders. Being so recent there was no way I was going to hold through any drawdown, so I exited early. I am 100% cash, well up since I started, and following in your footsteps, waiting for the cycle low.

  8. Aaron

    Bought some silver options (the only way Id play silver). And added the last batch to my gold.
    I am officially done.

  9. notGreedIsGood

    @dg … i guess your gut indicator isn’t working this time?

    having sais that, and based on history, i think we’ll be lucky if silver can reclaim 50, but i think it’s dangerous to assume that we will see 60 or 70 silver…

    well i do have you to thank as you helped inspire me to switch 70% of my agq to dgp before the crash, something i was mulling doing but your post cemented my decision.

  10. DG

    Not: We’ll see It got the bounce yesterday and there is sometimes a marginal new low. It would be it’s first clear miss if we didn’t bottom by tomorrow. I would have to figure out an appropriate punishment then (stop feeding it?)

  11. T.J. Rand

    wmp-

    Yes, due to expectation of lower inflation.

    Of course at some point, a poor economy increases the expectation of opening the $ spigot to stimulate economic activity (QE3), meaning higher PM prices.

  12. DG

    eamonn: I bought a little DGP last night and will probably buy more by Monday. No silver until I am convinced a bottom is at hand. I am getting to where I want to be in terms of % invested. Not quite there yet.

  13. tom

    $50 Silver was a target everyone was looking for and when that situation happens I always front run the number thus why I sold in the upper $40’s.No one ever went broke taking a profit.Nuff Said

  14. Jonas

    Gary may disagree with this, but I can’t help posting a quote from Ted Butler (one of the figureheads for the PM manipulation theorists). It comes from a completely different analysis than Gary’s but arrives at the same projection of the coming C-wave finale.

    “Long-time readers may remember a pet theory of mine that I had kind of forgotten about until this week. My theory was that before we get the real blast to the upside, amid the termination of the manipulation or a physical shortage, we would get an unbelievable shakeout to the downside. After that downside shock…and after the last speculator that could be tricked and frightened into selling did sell, the commercial would just put their hands in their pockets and not sell on the upturn. That selling void would create the conditions for the final blast-off. This sell-off sure feels like the big one to me.”

    – Silver analyst Ted Butler, 04 May 2011

  15. Gary

    DG,
    There was an exhaustion candle on March 11, 23 and April 11 and 25th.

    If you can tell me how one decides in real time which one to believe and which one not to believe I’m all ears.

  16. sophia

    Aaron,

    Just came back from lunch and thought of you! Well done..I covered earlier, made a bit of money, but not as much as you must have done πŸ™‚
    Happy though to be right on this one, ah ah ah

  17. archrival

    So Trichet decides to not raise rates, and sounds more dovish in some time. Jobless claims 474,000, much higher than expected. QE3 looking like a done deal.

  18. Gary

    I should also point out again that i was set to convert on Monday but the decline came premarket so I never had a chance. By the time the market opened I was already caught.

    Now If I could have foreseen the damage that would be done over the next week I would have went ahead and sold anyway but Like I said my crystal ball is still broken.

  19. Jonas

    So fairly big misses on the employment and up the dollar goes. Any opinions on the logic of that?

    I would rather say that bad economy -> need for more stimulus -> QE3 -> lower dollar

    But when did logic enter into this?

  20. Gary

    I’m stuck in the Redmond, OR airport for two hours. When I made my reservations online I mistakenly hit May 21st instead of May 5th.

    Imagine my surprise when I went to check in and they told me I didn’t have a reservation.

    What’s even worse, the airport is so small there isn’t even any place open to get breakfast.

  21. Gary

    Jonas,
    The dollar bounce has nothing to do with any economic news. It just needs to put in a cycle low.

    Remember I’ve pointed out that the dollar cycle tends to turn on or within a day of the employment report.

    Well the report is tomorrow.

  22. sophia

    Gary,

    AGQ is back to where it was last month. I am quite tempted ( I am NOT long of it) to try a small long at 215 as it was a level that found support last time. Do you have any pro-con view on it, or should I just wait for Monday morning and lift whatever price?
    Thanks for your input, you are the first research I read in the morning and bring me peace and quiet in my trading approach

  23. DG

    Easy, Gary. Those exhaustion candles did not come AFTER parabolic runs (except 4/25—see below).

    Why were you set to sell Monday? Crystal ball? What reasons?

    re 4/25: That candle could have been sold except: the timing was wrong given the cycles (too early) AND more importantly, had you sold then you’d be smiling now! That was the first clue this was getting late, in fact. Sellers of AGQ at 342 did not do too badly, eh? Selling there would have been fine.

  24. CMT

    Well, I just got notice that my 401k funds have been rolled into my IRA. Should have them tomorrow or Monday. Should I put it all in ZSL?

    I kid, I kid.

  25. sophia

    Actually I am confused…If Employement report is a turning point for the $, that means more sufferance for the PMs. Unless it is a dead cat bounce only, right?

  26. DG

    Sophia: the dollar is rallying now. It may gap up on the report, finishing its little bounce, and then reverse down starting its final decline into the 3 year bottom.

  27. Poly

    Gary, really the portfolio is down 40% from the high and you rode down a 200% (leverage) position in Silver. I know you dont have a crystal ball, that you were caught, that you planned on switching and that you don’t like selling into any cycle low.

    But with all due respect, this denial is seriously underwhelming. If you can not come out of this without being able to say I learned or would do at least one thing differently the next time, you’re not being true to yourself or this board.

  28. gold silver troll

    good, we have a USD bounce

    bad, there are more gaps at 36.5, 34.25 and 33.5 in SLV

    on another thought, the HFs can will all the gaps up to 25 cents while they are at it and then there will be reverse split and then HFs can short it to 25 cents again

    sorry for my morning rant…this is total BS

  29. gusto

    I wish everyone would get off Gary’s back. Its like everyone expects him to tell you when to exactly sell and exactly buy. Last week, I told everyone on here that it was exhaustion buying and was ignored. I knew it was time to sell at that point. Now is the time to buy and close your eyes if you have the money. You will never time it right. If you bought in the last month, you can either sell at a loss or wait for the bounce and unload some. We have only tagged the 50dma so its not like the chart is broken.

  30. sophia

    Ok DG, I thought that we were done with the 3y low…so we have some hope to see that stupid Silver go back up, right?

  31. Jonas

    Of course, Gary, I saw the initial and continuing claims number pop up on Finviz and somehow got that mixed up with the non-farm numbers due tomorrow.

  32. DG

    Gusto: You seem to be completely missing the point. No one is on Gary’s back about the past, but if you don’t learn from pain you just get pain again and again. You even contradicted yourself: “Last week, I told everyone on here that it was exhaustion buying,” What—do you have a crystal ball? You’ll never get it right exactly, so why did you post that? We should ignore someone who says he will never be right, no? Missing 150 points in one stock is not “exactly.” Who asked for exactly?

  33. Strellsy

    gusto – this happens on each and every correction. The board always debates the merits of Gary’s advice when they are losing money.

    It’s another sentiment indicator that we will soon see a bottom.

  34. Poly

    “Gusto”

    Nobody is getting on his back, this is NOT personal or some attack! It’s what traders do, they analyze their trades, thoughts and emotions.

    We’re all trading with hard earned money, trying to learn, better the markets and prosper. Gary runs a professional paid subscription service that weathered a 40% decline. You’ve got to be kidding me if you think for a second that discussing the trade is off limits or some type of attack.

  35. Larry

    it’s almost comical… the flip flop nature of those on here… he told you exactly what was going to happen for weeks…

    suck it up

    i’ve never been so confident in what he has said as I am right now… you all will be smiles and praises two weeks from now.

  36. Haggerty

    DG Poly

    If I can Chime in hear I think Gary as usual has the right approach.

    For example, Gary was expecting a correction at some point when AGQ was at roughly at the 275 level and then it rallied 90 points, I got out and thought I could get in lower. BUT as usual IN BULL MARKETS SURPRISES COME ON THE UPSIDE. I got totally burned and missed the move then got back in at the top. I didn’t hear anyone questioning the calls by Gary then.
    Your statements are with the benefit of hindsight. If he would have advised to get out at 45 on silver then the thing rallied to 60 you guys would have been beside yourselves.

  37. DG

    SB and others: C’mon guys. Who said a thing about giving up on Gary! Can’t he learn and change without being worth giving up on? Is the world all or none? Ridiculous! He changed after his 2006 experience (according to him) so why not after this one? This is weird how people are changing what has been said by me and Poly.

    Simple: You get crushed, you look to see whether you could have done something better/different. Period. EVERY decent trading book says the same thing. Most good traders keep a journal for just this reason. This is common knowledge in the top level of the trading world. Confusing the issue with red herrings (Exactly, Perfectly get the top, crystal ball) is just missing the point and changing the subject.

  38. Nike Boy2008

    Hey guys,

    if Gary knew silver would drop to 36, don’t you think, he would have sold?

    He was all set to sell and he missed by a day…tough lesson to learn for all of us, yes…now we all next time about parabolic moves

    I don’t know anyone else who provides a better service than Gary

  39. Keys

    Keeping things real…perhaps as a strategy, it would be better to load up during C-wave bottoms…and when the obvious parabolic moves comes to begin scaling out.

    In this strategy, your money is made during the boring years, and you leave money on the table, but the returns are much safer.
    My exit in silver was only due to the fact that I got burnt before with parabolic moves…I know for one that I am disappointed in myself for getting out of this parabolic move with a too close to call miss. I need a better strategy going forward. When the bus barely misses you, you are just plain lucky….

    Now let’s assume that Gary is correct, and this is profit taking event and silver soars at this point past $50…elastic band theory. Some here will take that trade, some will not…and there is nothing wrong with that. Some here are willing to risk 1/2 of their gains to obtain 2x their current gains…fine…this is a measure of risk. Not all of us here want that risk. Even if I knew silver would soar to 80, I would not want to follow silver down 40% first.

    The worst thing about going old turkey, are moments like these…the Achilles heel to the “Turkey”…let’s say US gets its taxes in order while silver tanks 40%, now the bull won’t rescue you as you are now stuck in the trade. Or say you are wrong about the final final c-wave surge, and your loses are forever.

    Going forward I think I will try to develop a better strategy, then selling on my “DG” fear index or gut feel. I am serious about that one too…we often excuse emotions as being irrational, I disagree sometimes our instincts perceive things in a way that our brains cannot process. We call this emotion, but sometimes it is instinct….I would rather have a system that doesn’t rely on instinct however as a last resort.
    Learning from this mess, will provide us a great tool going forward into the next 5-10 years as this bull finally tops…take our lumps now, but learn and adapt. This bull isn’t over, and I hope we do surge from here, so those with painful accounts can get a free education….

    I think our biggest problem were the exits (for those like myself)…we should have been at perhaps 25% during this last surge…not 100% and leverage….Layer out as the parabolic move comes in. Of course, that is my risk preference…some want to make money and quick dirty money, which of course is fine…So perhaps more than one strategy going forward.

    In terms of Gary…HE IS A GREAT COACH! …period…I have no desire to attack a man that puts his account in front of his words, is clear on his plan, and goes forward with it…I have no desire to criticize a man who’s plan has made many people here a lot of money…even if you lost 50% of you gains, who got you those gains to begin with? Anyways, once emotions and pain stops, we can concretely move forward, learn and adapt. Nobody says you need to follow Gary 100% either…we all own our own trades…..Look, how many guys let their subscribers live in their basements when things go off-plan anyways? That’s all heart baby!:)

  40. EricH

    DG,

    It isn’t the exhaustion candle that troubled me on his decision, it was the subsequent action that followed. Silver came right back to 49.5 and 49 the next 2 days and then started to pullback fast.

    Obviously Gary didn’t get his 50, but after the move to 49.5 and 49 attempts, he should have started to lighten up or at least took away the leverage when it made the swing high at 45.

  41. Hot Rod

    Gary/All,

    A shining light that I have kind of hung on to and been peeking at are the silver lease rates. I noticed that a few days ago, they started rising again despite the liquidation.

    Does anyone give weight to lease rate direction?

    Another comment regarding margin hikes. THe continued raising this past week in my opinion was purely done to get all small speculators out. THe big boys have the capital and it would affect them very little.

    It may be too late, but we will see some confirmation on this in the COT tomorrow and the real tell will be next Friday.

    What an opportunity for the big shorts to cover and go long.

    Gary – One other thing I can say is if you are right on this one and silver gets at least to the $50 range on this move and gold does hit $1650 range (let alone your newer outlined possible targets) it would be completely breathtaking.

  42. Le Fou

    Gary,

    You said you were caught when silver dropped so precipitously overnight. Will you convert to Gold at some point, or stay with silver?

    For those who switched before the drop in silver, would you recommend a switch back to silver when we get a swing in silver?

    Best,
    Le Fou

  43. DG

    Poly—I guess if people don’t get this we should drop it. It is disappointing, though. Funny how people are so personally involved with their trades that analyzing them after the fact feels like a personal attack. It explains why you were up more than anyone else on this board this year. I’m done with this as it cannot be made clearer. Apologies to those who were made uncomfortable by my trying to encourage Gary to figure out what went wrong.

  44. Haggerty

    DG

    Of course you always try to learn, and do things better. And I know you guys are not attacking Gary, But given everything you know to date, I think Gary’s approach and decision making is really well thought out. Every time I have tried to get cute and go against what he advises it has alway’s backfired on me.

  45. EricH

    Anyone know since this Silver bull started, when was the last time Silver had a 20% correction, closed below the 50 dma and then rallied to new highs the following 4-6 weeks?

  46. Keys

    DG,

    I think you made some really good points…people are just high on pain right now and are not at the point of and education yet…give it time…

    Thanks for Blogging!

  47. Poly

    These defensive posts of the trade make no sense, they are based on emotion and fear of upsetting. Nobody is infallible, that is part of the attraction

    I’m done for the day, good luck all.

  48. Gary

    Actually April 11th was exactly in the timing band for a cycle top. It was even a little late.

    As much as folks would like to claim that they can always sidestep a timing error the reality is that you can’t.

    This is why I only trade bull markets. Because the bull will always correct my timing mistakes. I’m pretty confident he will correct this one too.

    I seem to remember hearing the same thing about holding a core position through the last two intermediate corrections.

    Now a year later both of those instances only cost me a little time value just like I expected.

    So was it wrong to hold a core through an intermediate correction? In pure a profit and loss sense it was meaningless.

  49. DG

    Yes, Gary but April 11 was not after a parabolic rise. The others were and we are now well below both of them.

  50. gold silver troll

    this is getting hilarious…silver down another 5% at open again..

    silver could do to single digits in 1 week

    silver down almost 33% in 4 days…

    is anyone left on the boat?

  51. Haggerty

    I have learned a lot from people here.
    DG you alway’s keep a little dry powder for opportunities like this.
    Poly and SB have incredible patience and wait for numbers I can’t believe are hit. I hope you guys took my points as just discussion points and not attacks.

  52. wingwalker

    Poly & DG
    You guys are absolutely right. Rehashing trading decisions and learning from them is trading 101. I learned that long ago. But many don’t enjoy doing it since it’s the hard part of trading. That and taking losses.

    Anyway for today, I’m watching the miners very closely.

    And for me I’ll be scaling out of my remaining silver at around $45 (alot of trapped longs up there). And going to something with fresh air above it. Hopefully gold or large cap miners.

    Assuming $ isn’t putting in IT low and trade is over (which i’m not).

  53. catbird

    Poly,

    Options question.

    I’m not willing to commit much more capital but at these prices it’s hard to resist.

    I think you bought some June 160 GLD calls yesterday? What looks good this morning?

  54. pimaCanyon

    TJ,

    The family reunion is in Orkney
    Springs. My wife grew up in Alexandria. Her parents now live in Black Mountain, NC. Brothers still in VA.

    What part of VA are you in?

  55. sophia

    Ok, just sold back DUG, ERY and ZSL…ZSL made me sweat as it is volatile and I bought well too early ( April ) but at the end it paid up.
    Added some calls on GOLD as I believe in Gary.

  56. pimaCanyon

    muttonfish,

    Good point about the silver backtest. Will it hold, though, that is the question.

    If it hits that TL and breaks right thru it, what would TA say about that?

    That channel that silver is approaching the top channel line as a backtest–that channel has its lower channel line way down around $24. Seems that if silver gets back inside the channel (by blowing thru the upper channel line instead of just touching it and bouncing off), that it could go all the way down to the lower channel line at 24.

    Another possibility is the steeper channel drawn off the August 2010 and January 2011 lows. The lower channel line for the channel is around 33.50.

  57. pimaCanyon

    wmp,

    If jobs report is bad, why would it drive the dollar up? Seems like a bad jobs report would portend more QE which would be bad for the dollar in the long run, no?

  58. gold silver troll

    we should all be glad the USD the bouncing…when was the last time anything this market worked on logic?

    if this bounce lasts until tomorrow, this will be the best news for all of us because it means that USD will tank for another month after this πŸ™‚

  59. Brian

    DG, Although we did get the spikes in Silver, we did not see any of that action in Gold that has marked all the previous tops. So far the correction in Gold looks orderly. I suppose we can second guess not taking AGQ profits, but it is a little late for that.

  60. 86d4life

    Poly & DG,
    You guys said EXACTLY what needed to be said. In real time, does anybody get through an entire move without making some kind of mistake? It would be hard to believe.

    Honestly, I think we just caught a pass, a freebie. This debate needed to come up right now because in a month we`re going to be in the exact same position except with no safety net to fall back on, just pure ugly below. Figure out your exit plans now because next time it`s going to be for real.

  61. Gary

    I wouldn’t waste much time on silver trendlines and such. It’s too thin of a market for those to be of any real use.

    Here’s the question you have to ask yourself and how you answer will determine whether you should continue to hold silver or sell.

    If you think the final C-wave blow-off stage for GOLD is still ahead of us and if you think gold is going at least to $1650ish or higher, do you really think silver will remain below $40 while gold rockets $150 to $300 points higher?

    Everyone already knows how I answer that question, but then my opinion is meaningless. You have to answer it for yourself.

  62. aklaunch

    I am on board with Gold Silver Troll. I hope this turns out to be the dollar in the coil scenario. I have lost the better part of my last 3 years of savings so far. Not to scared though as i think this is a bull market and we will have a chance again if this does not work out.

  63. PST

    A bad jobs report, in and of itself, should be dollar negative, but there are other factors at play here: a dovish trichet this morning, usd/jpy hitting pivotal $80, increased liklihood of additional future easing (one of Feds mandates is full employment), etc. Plus as Gary will add, we’re in the timing band for a correction.

  64. muttonfish

    Pima,

    I’m thinking it will hold, IF this is in fact a daily cycle and not the big D. If it doesn’t hold, I will sell and wait. Everybody’s got to have their line in the sand, and that one is mine.

  65. pimaCanyon

    So this is the jobs report that Gary’s been mentioning? Happened today, not Friday.

    Now can someone tell me why a bad jobs report causes the dollar to spike to the upside?

  66. ALEX

    HHMM

    ZSL went from about $12.83 to over $20 later today in 4 trading days!

    I am thinking that I would’ve never shorted a bull mkt before, but THAT says a lot for the D-Wave expectations coming up.

    DG & POLY…I LOVE how Garys cycles have helped my ‘timing’..its another tool of confidence in the trading toolbox!! butI agree with much of your first post…also simply going along with what POLY? was saying yesterday. I have been trading metals and mkts for many yrs and I think its IMPERATIVE to look back at past gains/losses and learn from them. I’ve made many errors, we all have.
    I just need to try to Learn & add a USEFUL tool to my toolbox if I see one. I still keep it simple, not getting bogged down with this indicator or that,but improvement takes time, study, and effort.

    EX: where I worked,they had a carpentry dept…and this young new ‘kid’kept asking questions, buying ‘new tools’ all the time, and the ‘old timers’ always made fun of him, “What are you doing, trying to be a superstar? ha ha ha “.
    He is , BY FAR, THE most skilled carpenter there now 13 yrs later.

    He learned all he could from the old timers (they mostly got lazy and comfortable, ALWAYS SAYING there work was ‘Good enough for govt work!” Ever hear that?? He has many tricks of the trade that he picked up and taught himself, by reviewing mistakes determined not to repeat them. He’s a perfectionist. Never satisfied with… ” its as good as Joes”. He now also runs the compay “continuous improvement” meetings there for NADCAP and ISO

    In trading, We do the best with what we have and know…thats all we can do in the here and now, but if we can learn more…It pays dividends.

    JONAS

    your 1st post..

    Great quote that I wholeheartedly agree with πŸ™‚

  67. muttonfish

    Gary,

    I’ve found the trendlines to be helpful in the metals — just one more tool in the toolkit. The market may be thin but the same psychology and rules of human behavior apply here as they do everywhere else. πŸ™‚

    Hope you got some breakfast in your belleh.

  68. gold silver troll

    Hi Pima,

    Great question about why the USD is up on bad jobs data

    to be honest, I’m just glad that it is up and I don’t care why…i am not looking for a the reason as long as the USD rallies today and tomorrow

    if the USD tanked today, we may have top in 2 weeks

    this bounce buys us some time…

    on the other hand, I could be totally off and the USD just put in the 3 year low

  69. ALEX

    Sophia

    Just caught up to your post…those were some sweet trades (well, depends on when you bought, but they look good on charts πŸ™‚

  70. pimaCanyon

    forget my last comment re the jobs report. It IS tomorrow.

    Still, I wonder why a bad unemployment report today causes the dollar to rise. And if we get a bad report tomorrow, will it rise even more?

  71. aklaunch

    I think Gary is dead on! This dollar is not done yet. After all this printing how can we believe that is it, and the dollar is off to the races again….? I think the dollar is in a rally because it is being true to it cycle.

  72. Robert

    From Ted Butler–A blind person could see the manipulation that has done on

    Silver analyst Ted Butler posted an essay to his paying subscribers yesterday…and I’m stealing this paragraph and a bit from it…
    “The decline in silver has been brutal and fear-inspiring. Let me try to dissect it and put it into the proper perspective.The current takedown has been a typical COMEX-generated production. In little more than ten minutes in the absolute least liquid trading time possible, light COMEX predatory trading took the market down almost 13%. That takedown resulted in the continuing follow-through to the downside. I’m told the CFTC is looking into that trading, but then again, they have been looking into the silver manipulation forever. (Note to CFTC: time to stop looking and start doing.) While extreme, this COMEX price smash is remarkably similar to previous silver smashes where the commercials sold small amounts of contracts in order to start an avalanche to the downside, so that the commercials could buy at distressed price levels afterward.”

    “Also similar, is the general misunderstanding by the world at large of what actually occurred in these price smashes. That’s because the world at large does not and cannot recognize that the silver market is manipulated. So when these price smashes occur, the world invents reasons for them other than the simple truth of a COMEX-induced manipulation

  73. whitebear

    I have a stop on AGQ shares recently bought yesterday at 240, set for 210. If it gets hit, which is very possible I will be out and back in on the swing confirmation of gold. I just have to be prudent with the money I’m managing. I agree with Gary that gold will go much higher in step with silver.
    This is another good opportunity to practice emotional management. Buy the panic and sell the euphoria.

  74. catbird

    Earlier this week many were frustrated that the dollar wasn’t rallying enough to set us up for the drop to the 3 yr cycle low.

    Well, 70.70, if I recall, was the 3-yr cycle low on the dollar from 2008.

    At 73.60 now, it has a long way to go to get down there. Heck, by the jobs number tomorrow, it could spike to 75.

    The point is, it’ll have plenty of dropping to do to get to the low, which should be good for PMs.

  75. ALEX

    GOLD SILVER TROLL

    I hear ya,super high volume buying on UUP- but do this for confidence

    Pull it up on a 3 month chart , cover the past two weeks, and you see that on April 18…that up day was the highest, twice the avg volume, now uncover the next 2 wks…Sellers blew it away.

    It could be that way next week. πŸ™‚

  76. sophia

    Alex,
    Thanks for your compliment, it helps the moral…Yes, sweet trades, better on DUG and Ery than ZSL that I bought in a matter of dispair when we started heading down..The main thing is that they are nicely profitable πŸ™‚

  77. w

    Anyone else getting kilt in their metal positions?

    We are down 15 to 20% in our collective accounts…

    Mr Savage is correct, do not sell your Au positions now..

    Any new Ag buys MUST have a stop with it..

  78. yanivicious

    Gary,

    I heard today the CME (which already raised silver margin requirements by 84% in recent weeks), is going to again raise requirements on Monday. Do you know anything about this, and if this does happen do you think this could hinder our expectations of a cycle bottom on Friday or Monday?

    Thanks

  79. Bill no 2

    This old turkey has not lost a single dollar as I have not sold. My account balance is down, but I expected it to be because of Gary’s coaching.

  80. T.J. Rand

    Sorry Gary, I cant resist…when I read

    “Here’s the question you have to ask yourself…”

    my mind immediately went to Clint.

    “..Do you feel lucky, Punk? Well do you?”

  81. torero91

    IMO, AGQ and similar 2X or 3X products should always be traded with the utmost of caution. Absolutely nothing wrong with taking profits early with these derivatives, even if you get left behind after doing so. Anybody who played with SKF in the credit collapse knows what I’m talking about. So when I see posts that AGQ should have support at 215 or at whatever price, it tells me you do not understand what you are trading and I strongly encourage you to at least consider trading the 1X products instead. Using charts, trend lines, fibs, etc. on 2X ETFS is dangerous and a waste of time. You absolutely MUST use the underlying for technical analysis.

  82. whitebear

    I just capitulated on AGQ, so the bottom is probably in…
    Will jump back on with swing confirmation.

    Credit goes to those that can sit with the pain.

    Peace,

  83. PST

    PC,
    I’ll take a shot at your question. When looking at currencies, it’s often a relative comparison vs. others including the pound, euro, yen, etc. It’s not necessarily that the dollar is strengthening for any macro reasons, as much as it is that other currencies are weakening. I think the action today can be attributed to the following:
    1. Dovish ECB – many currency traders are expecting a rate hike out the ECB in June to combat inflation, but Trichet didn’t even mention it in his comments this morning. A rate hike was likely already priced in, so you have euro selling this morning now that there is uncertainty that this will happen.
    2. The USD/JPY has fallen below the ~$80 level this morning. This has been the line in the sand where the Japanese central bank will intervene to weaken the Yen. Actually after the earthquake/tsunami there was a coordinated G7 intervention to defend the Yen at this level. Traders are likely anticipating an imminent intervention again to weaken the Yen against the dollar.

  84. TZ(8155)

    Out my futures (was hoping for a bounce.)
    VERY small loss.
    I’m in BIG TURTLE mode and fully tucked in with only core.

  85. ALEX

    LE FOU

    Didnt get an answer gold vs silver , did you?

    I will share my thoughts, just a hunch, something I will be watching as it plays out ( you can always change along the way πŸ™‚

    ask: Do you (right here & now) believe gold is going to $2000+?
    Maybe not.
    Do you believe Silver could go back to at least $49 area? seems so.

    For that to happen…

    $37silver + 34% = $49.58

    $1500 gold = the same 34%=$2010

    SO, If I think silver WILL go to $49, but gold prob WONT go to $2000…

    THEN , I believe silver will still outperform Just returning to $49 , than if Gold even goes to $1900.

    So I would be inclined to stick to silver until I see differently -UNLESS gold bottoms and Silver drags around this low area…

    I am NOT saying that Gold wont clear $2000 , I am just saying IF Silver double tops, it seems to be higher % than my target for GOLD % at this point.

  86. T.J. Rand

    Pima-

    I live outside of Richmond in a town called Midlothian. Coincidentally, I went to high school in Alexandria.

    Orkney Springs is amazing in the summer – the Episcopal Dioceses of Virginia has a retreat up there (Shrinemont) that I’ve had the good fortune to visit a couple of times.

  87. fubsy_cooter

    Enjoying the conversation this morning. Especially that there is a disagreement being discussed with respect between DG, Gary, and Poly. Great modeling of behavior guys!

    Just want to add my tactic for this bottom. I have found Gary’s cycles to be really accurate for timing bottoms. So, I’m waiting for a swing low to add to positions. Simple. No guessing needed. If the low happens on a strong bounce, I’m in at day 1 or 2. I’ve done this a few times now, and its a low risk entry.

    I will set stops on new positions below the presumed cycle low in case I’m wrong as i don’t want to increase my risk at this point. If the stops are taken out, I’ll do the same thing on the next cycle low. I know Gary would disagree with this tactic as it could result in selling into a bottom (we did this in January and it backfired), but I want to avoid a deeper decline in the pms at the risk of sacrificing some gains.

    That’s my strategy from here. Still haven’t added anything on this correction. Am 30% invested between DGP and GDXJ.

    f

  88. Edwin

    Silver is crashing to earth.. hike in margin requirement exasperated the problem.

    it’s below the run-away condition 37.2 and headed south

    I’ll step into buy at 31 if it gets there.

    poor leveraged AGQ/HZu folks you’re holdings are smashed

  89. Keys

    Gold is showing strong strength via all other currencies, except for the yen. It is positive in Euro, and at par”ish” for the CAD and the Aussie.

  90. T.J. Rand

    The CME hikes are what they are…

    The only thing I don’t like is that the huge hikes are forcing margin liquidations which provide increased volatility, thus justifying additional hikes, which force more liquidations, etc.

    Interesting also that margins on ES (S&P) contracts weren’t raised during 2008-2009 during the extreme volatility of that period. And margins on food futures are only being nipped around the edges.

  91. Edwin

    tz – it’s feels like last Spring when the market was going up in one direction and reversing to another. lots of fakeout counter rallies. best to be in turtle mode.

    correction is not over

  92. TZ(8155)

    AGQ coming up on 50% loss from peak. This will probably be a capitulation point for anybody who invested most of their account in it ON MARGIN (and holding and hoping as we drop.)

    50% on full margin means the account is about to get cleared out at these levels.

  93. basil

    30% down on silver is D wave territory already, regardless of whether you call it a D wave or a daily cycle correction. These are labels. % is fact.

  94. pimaCanyon

    Gary,

    I know you’re very confident that this C wave has not topped yet. However, what if this time it is different and it has already topped?

    Do you have any indicators that will start to raise probabilities in your mind that maybe the C wave has already topped?

    For example, do you have a line in the sand that the dollar cannot go above? Or a price that gold cannot go below?

    The last daily cycle low is way down around 1380. We know that if gold drops below 1380, then we would have a failed daily cycle and that would imply that this intermediate cycle has topped (and very likely the C wave also).

    But that is still a big drop from here. Is there a gold price between where it’s trading now and that daily cycle low price that would tell you that it’s likely the C wave has already topped?

  95. Shalom Bernanke

    Duuude,

    It has crossed my mind, but I felt there are better/safer ways to play the bounce we expect. After all, if silver can bounce, everything should go, but if silver doesn’t, some things have shown relative strength (although not much, to be honest)

  96. Edwin

    pimaCanyon- imho this downward ‘pulse’ can go to 1470

    it’s not a buy yet. I hope for some support at 1515 bought some yesterday but once that was cracked.. we’re going down.

  97. BuritoBell

    Maybe it’s not that it’s so different this time, but that it is not the same. At least not the same as last time in the sense that it can never be exactly alike.

  98. daniele

    folks, about C and D wave, everythings you said about silver is meaningless.Is gold what does count, not silver.It’s all depend on gold.And gold is in a daily cycle low.That’s all.Gary told this many many times by now.Hoping for reentry on silver now.

  99. pimaCanyon

    TJ,

    Yes, my wife’s brother and his wife are involved in the church there. Sounds like a cool place. I’m looking forward to it. It will be my first visit as my wife and I have been together for just a little over 3 years now and were married last November. (Even though we’re newlyweds, we’re not twenty-somethings… Nancy graduated from high school in Alexandria in 79.)

  100. Farm Girl

    torero91 – I really disagree. AGQ gives very clear signals. I sold my AGQ, waited about a week, and bought DGP. A few days ago I posted that I sold 15% of the DGP to buy DITM AGQ options Friday or Monday, per Gary.
    I think I have had May 6 on my calendar for at least a month as Gary has said it is a likely day for a turn, plus or minus a day. It looks like it will be plus a day to me, but the market doesn’t care what I think.
    So what I am looking for is a bounce in AGQ, and a retracement that holds. I buy my options on the retracement and set a stop just below the low (sorry, Gary, but I think stops USED AT MAJOR TURNING POINTS are useful).
    Silver has been whacked so hard I am thinking about selling another 15% of my DGP today and moving 30% into AGQ options on Friday or Monday. But that may be more volatility than I can stand – I’m actually pretty conservative, and don’t have the testosterone issues some of you boys do πŸ˜‰
    Gary made a mistake, but as he endlessly repeats, bull markets bail out mistakes. Some of you sidestepped this one, others got caught. Next time, some will sidestep and others will get caught, except the faces will be different. Well, maybe not DG.
    (DG – Your book had a big impact on me and my husband. It’s a life-changer.)

  101. Edwin

    now currently a war is being fought at 1500

    once that goes, it will go down a few more points then maybe it will be ok to dip.

  102. Power Corrupts

    Mexico’s central bank has purchased 100 tons of gold so far this year. Russia’s central bank bought 19 tons in March, and Thailand’s central bank bought 9 tons in March. (Bloomberg News) China has $3 trillion of foreign reserves, half of which is $ denominated. Less than 2% of China’s foreign reserves are in gold. By contrast, Germany holds around 70% of their currency reserves in gold. China (and many other countries) are interested in diversifying more of their currency reserves into gold. (Richard Russell) There are buyers with deep pockets waiting in the wings.

  103. PST

    Are we sure that this is about cycles/waves or might it be better attributed to the withdrawal of liquidity in advance of the completion of QE2 and the return of the deflation trade? The entire commodity complex is getting crushed.

  104. pimaCanyon

    Wow, this move down in silver is a sight to behold! Someday I want to be on the right side of a trade like that! I can see why some traders start drooling when they see a parabolic blowoff, and why there was talk here about shorting the upcoming D wave. Classic waterfall decline, but the speed is breathtaking.

    It doesn’t look done to me–the wave pattern doesn’t look complete. Looks like we’re in the middle of a massive 3rd wave down. But wave patterns have fooled me in the past, so I have no idea where this thing will stop. Silver is on the backtest TL right now, but looks like it’s just breaking right thru it. Next stop is the channel line at $34.

  105. bud.shooter

    First time poster and subscriber. I like the miners here at these prices. They look ready to bust out. I’m long EXK, SLW, SIL, AAU, NGD, IAG and ANV…

  106. Patrick

    What are peoples plans for unloading their silver positions if this doesn’t turn around? How far are we going to ride this down?

    These silver charts are just ugly and banking on a miracle C-wave finale to bail us out of these positions seems questionable.

  107. YesLetsDiscuss

    Poly, DG,

    I certainly don’t want this discussion to end because some people and Gary might be offended. This is much bigger than that.

    We all know Gary’s timing is great for spotting bottoms. His cycle numbering etc is also top notch for the most part.

    But…that doesn’t mean he is perfect and always be right. He himself has said this many times. Yet, he is supremely confident in what he says, and defends it all the way. That is a mark of greatness when that person is right and is also the fall of the person when he is wrong.

    We all take these trades with our own volition, and are solely accountable for those. Its our responsibility to take care of our money.

    Now, having said that, we do act upon what Gary outlines. We also have this group psychology on this board and act on ideas that others express. Thats because we have some really good and experienced traders who have seen it all and learnt from the mistakes and the right decisions of the past.

    (will continue….)

  108. Matthew

    hedgies are gone they are in bonds right now. They have been running the price up and moved capital over. We are the last ones holding the bag. This bottom buying waiting thinking this massive bounce to infinity C wave will get you hammered

  109. DG

    Jmenoy: I have taken my personal stuff of the site since someone threatened to shoot me to death. Sorry. See if you can find it. Gary might respond to an email from you as he knows who I am.

  110. ...at ease

    I believe Gary is traveling today, on his way back to Vegas. So not sure he is feeling anything right now about what we are feeling/seeing.

  111. Edwin

    PST – with any deflation, there is a time of inflationary spike.

    If this spike was the spike, uh oh

    you’re on the wrong trade because PM imho don’t work in this environment

    have your hedges in place.

    holdings in TIP and cash have been steady

  112. Beanie

    Good to have some sort of protection, for all we know this could be march 2000 for silver, meaning it probably goes way down to $20 this year.

    ZSL.

    The scariest thing about this drop in silver continues to be the massive volume….the kind of volume one sees when a bubble pops.

  113. Moneyman

    Feel sry for a lot of people in here..Maybe the plan wasnt that good when it force people to sell.

    Its not about leverage anymore..AGQ from 380 to 200 or what?

    I also think a lot of guys bought high numbers..Like 300-350..

    Oki we will for sure bounce or go to 50 + or even 60..But some kind of risk management is needed..

    I dont think that we are at three year cycle low. But maybe we are..What then?

    How far must silver correct until we are forced to sell? Like 32?

    The good thing is that the sentiment is low now.

    This is really sad..

    But probably when a lot of people on this board are selling the bottom is near..

    How far will you guys keep silver..I havent sold anything yet but I feel sorry for a lot of people in here..

    You cant expect people to lose 40% and be cool with it.

    Do we have an alternative plan for this in case we are wrong?

  114. Patrick

    Its a little concerning to me that SIL is awfully close to breaching the low it made in march and thereby making a lower low.

  115. rapper

    this move will certainly convince people that the run is over. I still like Martin Armstrong’s timing though. Gold broke through 1530 and the high should come in mid June. The problem is that the move will change the overall look to the move. That something more dire is occurring. To badly paraphrase him….

  116. daniele

    I think that with this move, dollar is in day 3 in a new cycle.So at least 1-2 days more up (maybe 75) and then will turn down toward 3-year cycle low below 70.70.Meanwhile dollar bounce, silver can go down even to 30.Who know.

  117. Sandy101

    Are there still lot of folks in substantial AGQ positions. Are we going to keep holding on.

    What if this is the bounce out of 3year dollar low.

  118. gold silver troll

    there is no DOUBT anymore…3 year cycle low IN

    1) High volume in UUP for a week
    2) bad USD sentiment
    3) gold and silver tanking way before the USD bottoms (gold and silver smelling the bottom way before)
    4) All commodities getting hammered today

    GAME OVER FELLOWS

    the sky is falling…get out

  119. Taurus

    Bill no 2,
    It reminds me more of that movie Apollo 13. We were on a rocket ride to the Moon at one point, now we’re just trying stay alive in our crippled craft The AGQ.

  120. Patrick

    Doc just commented on his site that this move is very suggestive of a 3 year cycle low in the dollar. If that is the case game over for this C-wave.

  121. YesLetsDiscuss

    So what we need to learn from this is that Gary is a great guide, but we don’t have to hear and agree with every single point of his.

    We, on the board are not very encouraging of contrary opinions. I have seen many posters derided when they something that contradict’s Gary’s positions. That needs to change here when it comes with good analysis and is not empty trolling.

    One thought from me about differing from Gary is built upon some discussions yesterday, and would like to hear comments about it.

    What I have seen in this cycle is that I now differ from Gary’s insistence that Gold is the driver of this entire complex. It may be an overall long term driver, but when we talk about a few days and a few months, I think we need to figure out a way to have an independent assessment of Gold, Silver and Miners. They have behaved very, very differently from each other.

    Just because Gold did not get parabolic doesn’t mean Silver didn’t. Just because Gold was rising doesn’t mean that miners were. All three have their own thing and need to be analyzed independently.

    Gary will keep defending that Gold is the driver it all. From here on, my goal is to analyze all three. Who knows, maybe miners will be the Silver of the next wave. Silver may be the laggard next time. Forget the long term fundamentals, we are talking about days, weeks and months.

    I would certainly like to hear from this board and have analysis contributions regarding this going forward.

    We may yet get that blow off phase in the next couple weeks, but this is brutal right here, and if there are ways to avoid this account destruction, I think we should keep pursuing ways to add to Gary’s work agreeing with his basic cycle tool, but perhaps disagreeing with some other aspects as you’ve said before.

  122. St. Deluise

    well, depending on how the 4Hour /SI bar closes at 1 pm we could see $33 before this is over.

    buy signal is still valid but i made a mistake buying PSLV yesterday afternoon when i damn well know that bottoms are more likely to arrive in the first half than the second. also, the whole knife catching thing. small chunk so will hold until $14.

    will be hunting for gold in the morning tomorrow, hopefully around 1450ish.

    deluise out, hang in there team

  123. jhnewman

    I haven’t been in here for a few days, but there’s one thing I know FOR CERTAIN — this is the D-Wave!!!!! The D-Wave has started!!!!!!!!!! Run! Run for your lives! The sky is falling!!!!!!!!

    OK, OK — just kidding, Peeps. ;^)

    (This was just a test. I now return you to more reasonable comments.)

  124. PST

    Now this is what I call capitulation!

    The question is who has the minerals to step in and buy. Personally, I’m thinking about waiting for the low risk entry like Fubsy was talking about after we see a swing…although I am tempted.

  125. Matthew

    Gusto, you are screwed hope you din’t buy a lot.. Anyone read trader Dan Norci? He was saying same thing hedgies are expecting a bounce in the dollar so moved funds into bonds. I personally think we are going to see some awful news about the euro pretty soon in conjunction. Add to that the upped margins again on slv and you have what we are seeing today.

  126. pepper2009

    I remember Gary´s words that there will be a correction and it will be so brutal that everybody will be paralyzed to buy. I am now a big buyer! Thanks Gary!

  127. Mike

    I want to full cash when gold cracked 1500 or about GLD 146.5 and seeing the dollar make a large move. May be a mistake, but I had to have a tight stop given my gold leveraged position. It will probably come back soon and I will re-establish if/when it does.

  128. Duuuuuude

    I just bought AGQ at 200. Looks to me exhaustion is taking place.

    AS for the 1480 gold, I believe Gary would mean that it needs to close below that level.

    This is a tradeable place guys. If you have not bought, buy. If it closes below 1480, then get out. Other wise, sit on your hands. These are the moves that shake people off of the bull ride. The dollar will finish what it is going to do tomorrow and we move on with the C wave.

  129. Edwin

    the sky is falling. haha ‘the phrase is so much embodies sentiment

    if you’re feeling like jumping out of the window, you’ve gone way overboard with capital allocation to PMs.

    sorry but it’s time for the market to take it back and show you it takes no prisoners.

    ray of hope.. tomorrow is a new day.

  130. jhnewman

    pepper2009: Good for you! Ya got that right. Three or four weeks ago, Gary was talking about there being blood in the streets.

    I just bought a big chunk of SLW.

  131. Frank

    Per Gary’s criteria, GLD has tagged the BB and RSI(5) has dropped below 30. Just picked up my first margin trade, for a slot of AGQ! Go AGQ!

  132. Aaron

    Will you people please stop mentioning volume on UUP? that is the most irrelevant indicator when it comes to the dollar.

  133. Charles

    Well said pepper2009. Everything has happened as Gary stated and the dollar could be a coil break, fake and drop. I’m a buyer…

  134. GottaHaveIt

    DG, Poly, Alex:

    I have learned more from you guys on this blog than I have from Gary (no offense Gary) so please keep posting!

    If you ever get to the point where you don’t feel comfortable posting here, click on my profile and email me and I will set up a private board where active traders can swap ideas without being criticized or having to worry that newbies will follow you wihtout knowing what they are doing.

    Keep up the good work!

    Gary, I also gave you credit for giving me the idea to switch to gold, just too bad your timing was slightly off for your followers.

  135. Sandy101

    Gary is travelling today, hence may not post till the evening.

    DG-Whar are you doing with your banance 50 % AGQ position.

  136. jhnewman

    In the next 4-6 weeks, the Precious Metals Complex is going to slingshot upwards like a house afire.

    Warren Buffet: When others are fearful, you be greedy. When others are greedy, you be fearful.

    (Paraphrase)

  137. Edwin

    gold has hit 1478 in trade.

    not ready yet to buy imho, don’t try to catch the falling knife.

    it may take 2 weeks of wallowing around people licking their wounds and recovering from their injuries they inflicted on themselves from this week. haha

  138. ...at ease

    jhnewman said…
    Warren Buffet: When others are fearful, you be greedy. When others are greedy, you be fearful.

    Thanks JHN, good timing!

  139. Moneyman

    DG

    Can you here me? Lol..I lost 40% of my portfolio this week..Have you sold your share?

    Doc think this is the D-wave..Can anyone confirm that?

  140. Moneyman

    DG

    Can you here me? Lol..I lost 40% of my portfolio this week..Have you sold your share?

    Doc think this is the D-wave..Can anyone confirm that?

  141. jhnewman

    I’ve lived through 2 D-Waves in Precious Metals — 2006 and 2008. And this ain’t no D Wave. They plummet from the beginning like a boulder dropped off a cliff. Gold hasn’t done that. And silver’s move is a product of its huge run-up and “natural volatility” — not a D-Wave.

  142. 86d4life

    Yeah, this sucks………..

    The turbo boosters kicked in on my HP and it`s starting to levitate off the desk. Like Linda Blair…..

  143. YesLetsDiscuss

    …at ease, jhnewman,

    Thats what people who bought any day of this week thought. The big issue is having fortitude to hold the position when it keeps getting more fearsome.

  144. Duuuuuude

    Takes some cahoonas to buy silver here, but the big boys have big uns.

    Take a look at SLW. Despite the blood bath in silver, it is holding steady today.

    Come on guys, snap out of it. Don’t make me come over there and slap you around.

  145. oa92000

    ” jhnewman said…
    I’ve lived through 2 D-Waves in Precious Metals — 2006 and 2008. And this ain’t no D Wave. They plummet from the beginning like a boulder dropped off a cliff. Gold hasn’t done that. And silver’s move is a product of its huge run-up and “natural volatility” — not a D-Wave.”

    jhnewman ,
    you are the old timer, do you think silver will go up from here?

  146. 86d4life

    Can you guys imagine how Garys gonna feel when he gets off the plane and gets hooked up and sees this unholy mess!

    That poor man……….

  147. Vonda

    Reading through this morning’s comments and I for one vote for thoughtful deliberations organized around developing skills for top-spotting, the likes of which was initiated by DG and Poly.

    Hopefully we’ll have the opportunity to engage in such dialogue sooner rather than later. Oy. Account is down 50%. I could have done nothing since Jan low–saved myself all of the fun and angst–and gotten in here…or not.

    The good news is: my DITM options are now nearly worthless, so I can’t suffer any more downside there.
    The rest is in GDXJ and AG which I’m willing to hold indefinitely.

  148. Poly

    @Gottahaveit,

    You have to trade with what you feel comfortable with. For me, I’ve been waiting for this event, to some extent.
    I just put in most of my remaining funds, about 30% into GLD and some SLV. If this is truely the start of a D-Wave, we still will be given a chance to get out with at least these levels.

  149. Farm Girl

    Here is the problem I see. Gary has said that the dollar turns when the employment numbers are reported, plus or minus a day. Well, the employment numbers come tomorrow, and – sure enough – the dollar has turned.
    But it turned up, big time.
    I don’t see any way to tell if this is just the dead cat bounce, or if it is a turn that will last a month and take silver back to its 200dma, which would be around $30 in a month.
    Gary, if your “employment numbers plus or minus a day” is right, what do you make of the turn in the dollar today?

  150. Moneyman

    One interesting point is that everything that happens now Gary early predict..The only thing he missed is that silver is lower than he told us.

  151. EricH

    I picked up more GG, GDX and SLW June call options. It’s held up extremely well.

    Buying GDX below the 200 seems to be good risk.

  152. Ivan

    Read Gary carefully,Gary says dollar turns on employment report,but it could turn either up or down.Tommorow it will turn down.

  153. Wav_ridah

    Massacre at the comex. Rivers are running with blood. Can it get any worse? Buying more here and saving dry powder for tomorrow.

  154. Larry

    exactly moneyman! i’d be freaking out now… but i’ve gone back and read a few of the reports from last week.

  155. James

    edwin, gst and the other trolls – I assume you’re being paid for your posts, because otherwise it’s hard to fathom why you would relish so the losses of others. What a strange world we live in.

  156. DG

    Gotta: I love posting here and have learned too. Great offer though. I will keep it in mind.

    Moneyman: I still have some AGQ and am puking like everyone else. Bought lower so still have a modest profit but Geez! My fantastic year has turned into a modest profit. Not sure what to do.

  157. basil

    200$ is a good turnaround number on AGQ. For a bounce that is. I don’t buy the $60 and $70 anymore, obviously. This falling knife has broken much support on the downside. I think seeing silver going from 36 to 60 or 70 in a few weeks is very much dreaming.
    The silver bull is still alive, but this rally is over, not withstanding some strong bounces.

  158. St. Deluise

    one more thing: just looked at /DX, assuming the first move out of a coil is usually the false one this is a bullish development for PMs.

  159. John

    “…If this is truely the start of a D-Wave, we still will be given a chance to get out with at least these levels.”
    Thanks for that one, Poly…. I was considering selling.

    In the past I usually do that at the bottom – after long agony.
    I also can pick a top. Every time I start to gloat on all my wealth it drops.
    Just realised this, so I’ll tell you in the future if you like!
    J

  160. Brian

    DG, I thought you believed that guy was joking yesterday. Do you have new information to believe otherwise?

  161. RQ

    OK Just got back from being sick when we crashed below $36 Now we are starting to bounce. Just have to likely be prepared for one more dip. I hope that’s all. Would be nice if the bottom was in but i doubt it.

  162. ddn3f

    DG,

    Doc said
    “I would say that today’s surge in the DX combined with the across-the-board slaughter in commodities is very suggestive of a 3-year cycle low. It will take a few days to get confirmations, though.”

  163. catbird

    DG,

    Doc, says the bloodbath in all commodities today combined with a spike in the dollar suggests that the 3yr dollar low MIGHT be in but it will take a few more days for him to be satisfied.

  164. Poly

    DG,

    No he did not. He said the move in the dollar was suggestive of a 3yr low. Confirmation would be needed.

    The dollar has not broken the trend-line, in fact he argued few days ago that a good bounce would be supportive of a 3yr decline.

  165. catbird

    DG, Shalom, (or anyone):

    Wasn’t 1491 gold our hard stop and warning that the D wave was on until Gary recently removed all stops because he doesn’t want to be stopped out at a daily cycle bottom?

  166. PST

    James,
    If you meant PST, I’m not relishing in other’s peoples losses at all. I’ve been in that position and really feel for everyone here. In fact, I’m down a bit now myself.
    I was just trying to add some levity to the day. Please except my apologies if you think that I was trying to make you feel bad.

  167. niven

    If we stick to the fundamentals there is no way this is the 3 year dollar low. Compared to 08 and now the dollar is now in a much much weaker state. Helicopter Ben hasn’t exhausted his printing press yet.

  168. Moneyman

    Larry

    True..He told us that this will happen..But not silver 36..Gosh!

    Vonda

    Also lost a lot of value last days..But what to do? What can we do?

    The problem is that we all are looking for the bottom.

    Didnt Gary told us that the correction would feel like a D-wave?

  169. ALEX

    I am watching MINERS putting in a bottom. Its what I look for…

    Gold / Silver down big yesterday, they reversed and ended Green. Today the are currently going down on less and less volume intra day…Pull up a 5 day chart of AG or EXK ( these are silvers, should be absolutely KILLED right now, with silver down $3 again today).

    AG just shot up from $17.34 to over $18 while Silver is getting trashed.

    F.W.I.W. I am 100% as of yesterday, and feeling very good about it

  170. catbird

    For the first time this week, I’m concerned…and it’s not about silver, I don’t care about silver. It’s the fact that gold for the first time is showing big weakness.

    Still, I would feel like a complete chump selling here.

  171. YesLetsDiscuss

    Well, with the bloodbath over the past 4 days, its very unlikely we will go up at a rapid pace here. All bounces will be sold into, especially in Silver. It will take time to clear the mess.

  172. EricH

    If this isn’t a DWave, i won’t know what is.

    Silver down almost 30% in 4 trading days. Gold down almost 100 dollars in 4 trading days. GDX cracked 200 dma.

  173. Astrella

    Well looks like I stepped in front of a train with this mornings purchase.

    I am starting to get that sick feeling in my stomach, that I last felt in 2008 when I was on the wrong side of some trades.

    Another sentiment indicator that the bottom is close.

    FWIW I sold in 2008 and learnt that lesson the hard way.

  174. Moneyman

    Alex

    Thanks..I really need som good news..Lol! πŸ™‚

    In this mess i actually having a lot fun with all the panic..There are a lot of funny guys around here and they for sure make this easier..:-)

  175. Shalom Bernanke

    I’m long and will only sell into a rally (unless stopped out, but stops are wide), but agree with catbird on the gold observation.

    We’ll know more when the bounce comes. If they scream higher I’ll keep most, if they limp I’ll be forced to cut loose the trade.

    Just a waiting game now.

  176. Larry

    yep… gary said everybody would be flooding the board saying the D wave has started..

    he also said that we need to watch gold… and that silver may or may not go to 39 or further… obviously it’s gone further.

    What i’m sitting here pondering is… all these CME margin hikes everyone is talking about is… wait for it… are playing right into our theory for a parabolic blow off top! It was the catalyst to destroy sentiment and bomb the metals…

    Just amazing to watch it happen…

  177. John

    Gold tagged the high of April 11th, then bounced up to the bottom of daily channel which began on March 15th.
    Let’s hope it likes staying above it and doesn’t tread on a rotten floorboard again…

  178. Ryan

    I couldn’t take it so I’m out I’m guessing bottom is in for sure now. I just can’t risk it. Hopefully I can come back when there’s a swing.

  179. Le Fou

    ALEX,

    Thanks for your comments on moving from DGP to AGQ. I made that trade a little while ago. I’m holding my GLD 140 Jun calls, so I’m protected if only one goes up.

    WRT AG, I’m still holding, though a trade trigger sold me out. Bought back in at a lower price. πŸ™‚

    FYI FOR THE BOARD

    Check trade triggers.

    For GLD, the Last was Less than or equal to 145.48 at 11:08:46 EDT.

    Date: 05/05/2011
    RE: Your account ending in xxxx

    The trigger you set on 05/04/2011 has activated.

    Best,
    Le Fou

  180. Astrella

    Despite the sick feeling in my stomach, thanks to Gary’s guidance I am still in profit for the year.

    Despite all the bloodletting I haven’t yet lost any money.

    So I’m holding on to this bull with both hands. Sore, tired hands.

  181. Dan

    Guys whether Gary states it now, or after the coming bounce rolls back over, the C-wave is done. Silver has crashed almost 30% get real. Am personally amazed people here are are still debating this issue. Total ignorance of past patterns!

    Glad to see Doc is finally slowly coming got his realization btw.

  182. catbird

    Well, I’m looking forward to the nightly report (and I don’t mean that sarcastically, I really am).

    We’re in a very mushy, subjective area. The USD is rallying….but it’s rallying HUGE.

    There is panic and blood in the streets…but of course, those things are present at the onset of D-waves too.

    I just wish gold had never dipped below 1490.

    I really want to hold on at least until the jobs number tomorrow…but at this rate, who’s to say gold doesn’t drop $40 overnight?

  183. Vonda

    Yep, MONEYMAN – feel kinda helpless. Though in an odd way, I feel as sense of relief at hitting the lowest I had psychologically planned for. For once I set my trades up to match my risk tolerance and if I was happy with “1/2 an account” in December then I might as well be happy with it now.

    But I am also eyeing those gold numbers, CATBIRD. Disconcerting based on what I’ve had the privilege to learn from you all here: It’s not “supposed” to be doing this.

    And I feel the weight and pain of so many we know of who were going long right before this bloodbath. The absence of some of those familiar voices this week saddens me…

  184. basil

    Doesn’t matter how you label this decline. We went down more than 30% in silver. D waves supposedly can go down 30% or as much as 50%. So what does the labeling really matter? Calling it this or that or putting a letter in front of it is just something to cling on like a crutch. The fact of the matter is that this is a decline that could very well be a D wave. And what’s following could be a continuation of a C wave or you could call it an A wave. When I look at past C wave tops, there is really nothing there that makes me think it wasn’t in place at this top.

  185. James

    PST, no, by “gst” I was referring to gold silver troll. As for your posts, I find them very useful, and appreciate the contribution you and the many of the other regular posters make to the blog. My issue is with those who feed off others’ misfortune. Kind of a sick way to spend one’s life imho (even if they’re getting paid for it!).

  186. Poly

    This is difficult to stomach, but puking your shares now after 5 days of bloodshed is not going to help you.
    I know it does not seem remotely possible, but 4-5 day collapses like this often result in fairly strong snapback rally’s. The shorts will have to cover to cash out and realize gain and price will bring in buyers once they see some support.

    Also we have to print a cycle low at some point very soon. The early part of the next cycle will give you an opportunity to regain “some” of the drop and exit early in the cycle if you fear a failed cycle.
    That’s just MHO, I’ve taken a bath today too!

  187. pimaCanyon

    Yes,

    Good points. I too believe it’s very possible, even very likely, that silver has been the driver for the last few weeks at least. If so, we have had our parabolic top and the dreaded D wave is well underway.

    It’s certainly a lesson for me regarding parabolic tops.

    The next few days will be the tell here. If the dollar continues rallying and breaks significantly above its downtrend line, then it becomes very likely that the 3 year cycle low on the dollar is in. If that happens, the D wave has begun and we will have ridden much of it down on the wrong side of the trade.

  188. basil

    I have decided to NOT buy this drop and neither to buy any bounce here. I will wait for the dust to settle.

  189. Salty

    A ray of hope from P Radomski(just out)

    We believe that opening additional
    small speculative long position in gold is a good idea.

    The precious metals market has been declining rapidly today, however it
    seems that a bottom is being reached. Gold moved to its short-term support
    line and mining stocks moved to their 2008 highs and also a lower border of
    the rising trend channel. These are quite strong support lines and since
    they have just been reached, at least a short-term rally is likely to
    follow. Silver is at its long-term support line (and a cyclical turning
    point) as well. The sentiment is very bad and since the decline was so
    sharp, at least a short-term bounce appears likely.

  190. Jonas

    Dan

    I don’t think that it’s possible to categorically state anything about the future development of the PMs at this point – just based on prior patterns.

    For sure, most small investors will be scared away from the scene by this slaughter. But since all fundamental drivers remain intact, who knows what big money will do now that the PMs are on sale at a discount?

    I don’t really anticipate another immidiate parabolic rise either, but a steady climb, much like has been the case for gold lately, doesn’t seem impossible at all.

  191. DK

    Gottahaveit,

    I really like the idea of the trading board. I stopped posting on this site mostly because of Gary’s attitude, but still read it every once in a while because I value the opinion of DG, Poly, Wes, Alex and some of the other independent thinkers who want to share ideas and learn. If some of these people are up to it, I would definitely participate, if it is okay with you guys.

  192. basil

    Poly,

    you write…
    “This is difficult to stomach, but puking your shares now after 5 days of bloodshed is not going to help you.”

    That’s a gambling assumption. Investors have been holding every D wave all the wave down with the assumption that it would make no sense to sell now, because it was already to late. You can ride this thing all the way down, thinking that same thought every day.

  193. Poly

    Rather silly and simply ignorant to talk D-Wave when you don’t know what it means!

    First, there are no cycles in Silver, FULL STOP. Quoting Silver’s decline is pointless. The fact you’re invested and getting killed in it does not make it a D-wave. If you bought 3 weeks ago you’re even!

    The cycles work off Gold. It’s down 5.5%, hardly a D-Wave. It’s still ABOVE it’s last cycle. A D-Wave can not be confirmed until we witness the behavior of the NEXT daily cycle.

  194. D. Saul Weiner

    I too greatly appreciate Gary’s analysis and his communication. He has been pretty upfront regarding his strategy of riding the bull and not getting thrown off during corrections.

    I must say, though, that if Gary was contemplating exiting silver, it would have been helpful to hear these thoughts ahead of time. That may have helped others to plan their own strategies. Perhaps he did share his thinking on the blog, though I do not always read it.

    Gary has been right far more often than not, obviously. One premise which was recently violated, though, was that the price action in gold will drive movements in silver. Clearly, the breakdown in silver initiated the correction here. Though we would have had a correction at some point, no doubt. The skeptic in me says that traders are going to be too shell-shocked to load up on silver any time soon. If that is the case, will the weakness in silver also drive weakness in gold?

  195. ALEX

    Blogger Lynn said…

    My only wish is that ZSL wasn’t marked as a BUY. Do we only make money on the upside?

    If this isnt the D-wave (its not i.m.h.o.)

    I think we know what to buy then πŸ™‚

    I am only at posts stamped 8:30 am

    got a phone call and cant even catch up to my last post!! You guys are FAST!!!

  196. DG

    Brian: I assume he’s joking but you never know, right?

    Voltaire and Catbird: If the prevous daily cycle low is violated the C wave is over. 1491 was not really a daily cycle low as it was not long enouhg (3-5 days)

    DK: Good to have you back! I always enjoyed your posts. Didn’t know DK was you.

  197. YesLetsDiscuss

    Just looking at the gold chart, this looks very similar to Nov 2010, like the first phase of an intermediate decline. No time for another intermediate cycle means the C-wave is over.

    At the best, we make it back to new highs, but considering how far we had gone, a 50% retracement would make me more than happy. I am fully invested right now and will sell out then. But its so bleak right now, I am not even sure if we get any bounce at all.

    Sorry to sound pessimistic, but feel like crap after my buys at yesterday’s lows.

  198. 86d4life

    Salty,
    I puked up a hell of a pile of change following him. Remember that one about a broken watch being right twice a day?

    Things started to turn around when I started to follow Gary.

  199. TZ(8155)

    Got stopped out my earlier bounce buys, but I’m back in with stops near the lows on gold. Will be very surprised if low doesn’t hold. Would signal incredible weakness.

  200. Ben

    -24.5% in my trading account in one week. If that ain’t a D-wave, then I’d hate to see one. If these losses are erased in the next four weeks, I will be stunned. Sell-in-May-and go away crowd is gone, QE2 near the end, margins raised again and again to stifle the beast (ver successfully, it appears). If the alternate dollar cycle count is the one to go by, why would smart money buy the final dip in the dollar if it’s going to be short lived?

    I’d say the odds are high I missed the exit from the D-wave and now will wait for the A-wave to exit. If there’s actually more to this C-wave besides a dead cat bounce, I will be really surprised. And all in, so bring it on, please!

    Oops, -26% now.

  201. YesLetsDiscuss

    Poly,

    “First, there are no cycles in Silver, FULL STOP.”

    Thats the assumption I am challenging. The components of the PM complex have behaved very differently. Miners have gone lower ad lower. Gold had risen steadily and Silver had gone parabolic. Gold may be a long term fundamental driver, but from here on, I refuse to keep believing that Gold drives Silver or the miners in the short term. They do things on their own.

    In the future, miners may do what silver did. Then, they should be the prime indicator, like silver should have been in this one. If they go parabolic, all sells should be based on them, not gold.

  202. Edwin

    this isn’t a D-wave yet

    you only lose 40% because you’re leveraged to the hilt.

    silver went from 2010 14 to 49 that’s 350% gain

    a haircut is going to happen.

    i’m buying silver at 31 if gets there.

  203. Bob loves Hawaii

    An alternate rationale for the weakness. The Treasury is unable to borrow anymore money until the debt ceiling is raised. Ergo, no liquidity to lift the markets. I imagine that news will cause quire a lift in these risk assets.

  204. Wes

    wingwalker,

    I’m trying to catch up on the posts, so this will be untimely.

    I noted with interest your comment about trapped longs above silver $45. I wonder how many are still in after the rash of margin raises.

    I’m not a commodities guy (heck of a time to discover that) but are these trapped longs still there ?

  205. catbird

    Full disclosure:

    When gold approached the day’s lows a second ago I trimmed (trimmed, NOT liquidated) for 3 reasons:

    1. I was concerned that if the 1478 low was violated we would drop through an air pocket

    2. I wanted to go from 122% invested to about 80%

    3. Since I began investing with Gary began in August, I have annualized gains that most hedgies would kill for. But, I have bills coming due later this year. Capital preservation–a purely lifestyle dictated decision.

    Again, just for the sake of full disclosure.

  206. niven

    What do you guys think will happen to the price of the miners on Monday? Earnings report are released, however, there is still one margin hike! The miners seem to be a good predictor for the future price movements of precious metals which makes it a strong possibility that we’ll see small percentage gains or a swing low on Monday.

  207. Hot Rod

    I posted this last night late but don’t believe I saw a comment. I was out all morning and looked at it again in light of the big pop in the USD. To me, it seems very viable but of course I don’t know a thing about cycles and how it may conflict with them.
    ——————————–
    This may be a stretch but here goes….

    I’m seeing some similarity in the Gold/silver/USD formation right now to the time period of March to December 2007:

    http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&st=2007-01-01&en=2007-12-31&id=p36939707092&a=233342407

    Gold had a big consolidation and made a nice run up (sort of looked parabolic) in Sept and Oct 2007. THen in early Nov, gold got hit (silver not as much as today, though) and the USD did a little “bottom feeding.” Also note that Gold made it to the BB bottom and just made it to the oversold RSI. Another key was the pop in the USD.

    Ok, now here is a chart with 5 more months added on so you can see what happened next:

    http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&st=2007-01-01&en=2008-04-31&id=p66964022606&a=233342407

    Maybe you can now see my thought process here.

    In late Dec 2007 Gold took off again and ran the final C wave top to March.

    Another key here is the trend on the USD and potential similarities. In Nov 2007 the USD bottom fed around 75 but did have a pop from 75 to 76 that coincided with gold’s temporary drop. Then at the C wave top it was at 72 (give or take).

    Fast forward to 2011. We got a pop from 73 to 74. What if it stretches and takes 3-5 more months to fall to 70 and we can made another more organized run here?

    A secondary option is that (look at chart #2) the action we saw in gold this week coincided with the Feb 1 2008 drop. Notice how gold got down to the BB. If this is the case, then gold took 1 1/2 months to finish the C wave and made it to significant new highs.

    Just food for thought.

  208. niven

    dead bounce up backed by no fundamental reasons. I guess that is just the beginning of a new dollar cycle.

  209. Hot Rod

    Positive inkling ray of light in a sea of blood….

    The past 1 1/2 hours silver has “held up” despite gold’s push down into severe lows (for it’s charts).

  210. Farm Girl

    From http://blogs.barrons.com/focusonfunds/2011/05/04/pressure-builds-cme-to-hike-silver-rates-4th-time-carlos-slim-selling

    Pressure Builds: CME To Hike Silver Rates 4th Time; Carlos Slim Selling

    * New Small-Cap Oil ETF Set To Launch
    * Copper Seen At Inflection Point Vs. Stocks
    By Murray Coleman

    More pressure is likely to show up in silver futures markets in coming days after the Chicago Mercantile Exchange notified traders today that it’ll raise margin requirements for a fourth time in a little more than a week.

    Effective after the close of business Thursday, the CME’s initial margin requirements — the minimum amount of cash that must be deposited when borrowing from brokers to trade silver — will increase to $18,900 per futures contract, up from $16,200. About a year ago, the margin was $4,250.

    Today was the first full-day of the CME’s third recent margin hike on silver contracts. The latest round means that investors will get two days of trading in before costs go up again.

    Separately, billionaire Carlos Slim has been selling silver futures to hedge the production of his silver mine, CNBC is reporting this afternoon.

    The report comes after today’s WSJ story detailing how several big hedge fund managers such as George Soros have been moving out of silver and gold.

    Silver for July delivery settled lower by $3.20 an ounce, or 7.5%, at $39.388 an ounce on the Comex division of the New York Mercantile Exchange. That was the lowest close since April 6.

    Gold for June delivery dropped $25.10, or 1.6%, to settled at $1,515.30 an ounce on Comex. That represented the contract’s biggest one-day percentage drop since March 15.

    Meanwhile, the iShares Silver ETF (SLV) fell 5.7% and the Global X Silver Miners ETF (SIL) closed down 0.2%.

    The SPDR Gold ETF (GLD) finished 1.4% lower and the Market Vectors Gold Miners ETF (GDX) closed up by 0.2%.

    The sibling Junior Miners Gold Trust (GDXJ) also managed to finish in positive territory, closing with a 0.1% gain.

    Top holdings include Silver Standard Resources (SSRI), which was up 1.6%, and Silvercorp Metals (SVM), which gained 0.8%.

    Note: Barclays has sent a late note advising clients to sell their silver positions. The firm’s analysts are now projecting that the correction will deepen and that futures could fall to around the $34 an ounce level before finding technical support. Gold’s floor appears to be around $1,475 an ounce, the report added. The analysts remain bullish on both, however, over the medium- to long-term view.

  211. Dan

    Edwin,

    You win post if the day in my books….”this isn’t the D-wave” but “I’m buying when it hits 31” LOL so at that point silver will be at the 200dmva and will have declined nearly 40% but “this isn’t the D-wave.” haha

    Would love to see your definition of a large decline or “d-wave” if you dont think 40% is sufficient!

    That cracked me up.

  212. basil

    Poly,

    I think the letter in front of the % is secondary. The % after the letter is and always will be my primary concern.

    At what %-loss would you say that the letter in front of the % becomes semantics?

    πŸ™‚

  213. David

    So the SMT portfolio is down over 50% at this point.

    It’s also on 40% margin.

    At what point does a margin call get triggered?

    Just curious.

  214. T.J. Rand

    “One minute you’re up half a million, the next your kids don’t go to college and they’re repossessing your Bentley”

    I sold the rest of my AGQ and DGP over the past 3 days (some even this AM) – I could not clear my head to think while they were taking bites out of my account. Have’t touched my miners.

    Like DG, I have turned an amazing year into a pedestrian, mildly profitable one. I will be adding when we get signs that the carnage is going to take a break (today’s candles could turn into reversal candles) and again at the swing.

  215. Razvan

    now it has become clear to me the reason for the gold bull was not the devaluation of the US dollar but rather the inability of the US government to find Bin Laden. Now that he is dead we have entered the D wave.

  216. catbird

    FWIW, to any that follow Turd Ferguson’s Watchtower blog:

    He drew a chart that shows lots of dead air from here to 1445 gold. Gold keeps flirting with the day’s lows at 1478. If that gets breached, there is a lot of air to drop through.

    Capital preservation. Gary has always said waiting for a clear swing low is an option for the more conservative.

  217. sophia

    well I guess that Gary was right when he was saying that when the market will go back up, there will not be so many people long anymore…what a day!

  218. Michael

    Food for thought in silver: cotton went down 30% in November 2010 and then promptly doubled. Sugar went down 25% in November 2010 and then rallied 44%.
    Big commodity bull, trend still deserves respect.

  219. Dan

    David,

    That’s a good point. Raises the question as to whether someone is really holding that portfolio inactuality.

  220. Duuuuuude

    I hope at the end of the day when all has been said and done, that those who have spent today trashing Gary man up and offer an apology. I feel embarrassed for you.

  221. Tim and Jeanene

    I think the problem with silver is the CME margin hikes. Everyone “knows” the QE that is going on and every “knows” metals can “only” go higher. So they buy silver and gold on margin.

    If these prices were truly sustainable long term, margin hikes would not matter that much. Metals would be held by strong hands. Instead, the CME margin hike and following silver crash shows that that trade was loaded with speculators, not investors.

  222. Dan

    Catbird,

    I have been following Turd but his recent posts of desperation and cluelessness as to where the price will stop declining are just silly. ALL past parabolic crashes have stopped at the 200dmva currently around $30 and that’s where this one will stop. End of story.

  223. Shalom Bernanke

    My sentiments are aligned with catbird. I should be up on this trade, with a cushion by now.

    As oversold as things appear, they can always go lower. I’m sitting with what I have and will make my decision to trim or not in the next few hours.

    I’m not getting hammered, but that’s not my concern as the upside it typically limited in my trades once they go “stale”, and it’s getting close. πŸ™‚

    Sitting tight, but miners better get some legs or I’ll break out the shears.

  224. thedocument

    Doc (favoring the third person here) said the following:

    1. The action in the DX and commodities today is conducive to a 3-year cycle low being set, but this can’t be confirmed for a few days.

    2. The action is also conducive to a type of massive shakeout needed, based on sentiment readings, IF a final dollar collapse and gold run were to occur.

    3. Regardless of which of the first two scenarios is the eventual outcome, gold is due for a bounce out of a daily cycle low, and we can better judge the first two scenarios based on the setups at that time.

  225. Ben

    The reality is that on my own, I did worse that when tapping into Gary’s service. It wasn’t easy before, and I got shellacked in late ’08. I don’t subscribe to be perfect with every major turn. I just hope to do better. And I have. He’s worth every penny. Anybody expecting absolute clarity and predictive powers from Gary needs to have their own head examined.

  226. Tim and Jeanene

    Jeff Clark from Growth Stock Wire:

    “So where do we go from here?

    In previous years, whenever silver rallied more than 50% above its 200-DMA, it always came back down to at least test the moving average line (the blue line on the chart). History suggests that’ll happen this time as well.

    This process should take at least a few months as the price of silver falls and the 200-DMA climbs slightly higher.”

  227. TZ(8155)

    Stopped out of 2nd bounce trade. 0.5% loss.

    Very few things I have tried this week have worked (other than getting out of GC). Something has broken. The situation has changed. The market has entered a new phase. Etc.

    Best to back off, chill, and not keep trying. This reminds me of how I lost 40% in 2008. Things weren’t working and I didn’t know why but I kept making the same trades (and holding). Not gonna happen again.

  228. David

    For those who are in the SMT portfolio, some triage is going to be necessary.

    Riding silver to $30 while saying “at least it’s not a D-wave” is not an option.

    Those people need to live to fight another day. If they switch to GDXJ, and go off margin, they can still participate in the massive C-wave top if it ever happens, or they can ride out a D-wave and wait for an A-wave to make them whole.

    What is not an option: margin, AGQ, options.

    I don’t care if this is a D-wave or not, people cannot be wiped out waiting for $70 silver.

  229. catbird

    Dan,

    I worry about that guy, Turd.

    He sees everything in the narrative of manipulators vs. the forces of goodness, the longs.

    When PMs rise, well, that’s swell. When they’re falling, it’s the dastardly manipulation. He’s playing the “The Dark Forces were stronger than I thought” card now.

    It’s fine to believe in manipulation but I think the guy is kind of unstable–well, I shouldn’t say that–let me say he comes ACROSS as unstable.

  230. pimaCanyon

    Dan,

    Insinuating that Gary is a liar has no place on this blog. Disagreeing with his calls is one thing and something that’s healthy if it’s done without name calling and other forms of verbal abuse. But implying that he’s lying about his portfolio is out of place here. If there’s one thing that Gary has, it’s integrity.

    If you would bother to look at how his portfolio is allocated, you would see that even though he is 140 percent invested, he has come up to that level without using 40 percent margin. He brought his account to the 140 percent level partly with the use of DITM call options. So even though he is 140 percent invested, he is using less than 40 percent margin. So I doubt he is close to a margin call today.

  231. traderRob

    I look at the announcement of 2 future margin hikes as a bear trap. Obviously they’re working to clear out sentiment, but now the dumb money’s thinking that day of margin hike = 10% decline. Just what we need to pull more folks onto the short side, as they’ll likely fail to recognize that the second hike is already priced in. Get everyone piled on the short side and leveraged to the hilt in ZSL, and then blow the top off SLV.

    Just a thought, but I figure the suicidal crowd here could use some alternative hypotheses.

  232. Gary

    Doc,
    Exactly, gold and silver are both due a bounce out of a daily cycle low. If that bounce fails to make new highs and moves below the cycle low then yes this C-wave is over.

    If one thinks it is over then unload positions into the bounce and buy some out of the money call options on SLV to play the rest of the D-wave.

    I find it hard to believe that the largest C-wave of the entire bull market will top with such a modest advance by gold and miners. I find it even harder to believe that Bernanke will “get away” with printing trillions of dollars and not cause a currency crisis.

    So I’m going to continue to operate under the assumption that gold has one more leg up and the dollar one more leg down unless gold breaks below this cycle low where ever it ends up at.

  233. Bob loves Hawaii

    If you want to see if there is a tradeable trend break, watch the EMA10 on the 15 minute chart. The algos have been riding it down without fail since Monday.

  234. Cory

    I just wanted to throw something out there and back Gary up. I have made over 20 million with Gary after starting out with 2. I was in AGQ for years after getting in close to the bottom. I sold all of my AGQ after several years 3 days from the top (even though I missed out on millions those next few days and was mad) for this reason: one of the most common patterns in the market is Gary’s T1, or the old 2 steps forward 1 step back adage that has been around forever. If you look at the silver chart, AGQ went up 100 pts, consolidated, and then I sold my last share at 320, which was roughly 100 from the consolidation zone. Now silver broke back to highs, but the hedgies always trip stops before turning. Right now we are back to the consolidation zone. What was amazing is how fast the last part of the T1, both up and down, played out. This is a very low risk time to buy, and after years of pure silver, I am now at 130 % miners, down 7% at the moment. Just wanted to offer up a different point of view for new and old subs. Its a perfect T1, the swings are just bigger now because the whole world is watching.

  235. Duuuuuude

    Gary is a victim today of SELF ATTRIBUTION BIAS (http://stockmarketinvesting.com.au/Self-Attribution-Bias.html)

    In the book “Beyond Greed and Fear”, page 130:
    “Having a financial adviser enables the investor to carry a psychological call option. If an investment decision turns out well, the investor can take the credit, attributing the favorable outcome to his or her own skill. If the decision turns out badly, the investor can protect his or her ego and lower the regret by blaming the adviser. This phenomenon involves self-attribution bias. The investor attributes favorable outcomes to skill, and unfavorable outcomes to either somebody else, or just plain bad luck.”

  236. Haggerty

    Guys based on everything that we have seen. Not counting AGQ, the miners should be down a lot more and so should Gold if this was a D wave. this is an over reaction of (Margin hikes, Correction, Sentiment). I really think Gary has this one nailed we just need to wait it out I think.

  237. Matthew

    lol..well you should not be thinking of gary as an advisor.. big trouble with SEC and Gary has already crossed that line…big nono…2nd Gary does not man up and say he is wrong when he has been wrong. “I don’t have a crystal ball” “Turn off you computers come back next week if you can’t handle it” He has clearly crossed a line when it comes to sec regs about financial advisers..

  238. pimaCanyon

    T&J,

    what? You have a lie detector you can apply to blog posts, and you know which ones are true and which are phony? Good for you!

  239. David

    I have not seen this mentioned on the board, but one of the main reasons the dollar is so strong today is that ECB head was not as hawkish as some would have liked. Remember the euro makes up 30-40% of the dollar index. To me the fundamentals have not changed one bit. There were to many spec longs in euro expecting a more hawkish Trichet and another rate hike in June. The ECB will most likely hike again in July and the interest rate d/f will widen further in favor of the euro. To me it just looks like a washout of euro longs who were late to the party.

  240. Jennifer

    Just because this correction is worse in real life than the “scary correction” we had anticipated and steeled ourselves for in our minds doesn’t make Gary’s calls wrong. Its happening just like he said it would so far.

    That being said. This is sooo much pain I am completely paralyzed with it.

  241. Tim and Jeanene

    pima –

    Not calling anyone a liar. I just find it interesting that people are willing to share that kind of information on blog posts. Never understood what it accomplishes except a bit of bragging.

  242. Moneyman

    Catbird

    Lol

    It’s fine to believe in manipulation but I think the guy is kind of unstable–well, I shouldn’t say that–let me say he comes ACROSS as unstable

  243. Jay Lin

    Instead of trying to pick bottom and getting stopped out repeatedly, I should just hang out here and read many good comments. This is a great blog.

  244. Todd

    Cory,
    Just curious. You said you have been in AGQ for years, but in has not been around that long. Did you mean something else?

  245. traderRob

    Matthew,

    There’s no trouble coming for Gary with the SEC; unsuccessful newsletter writers get shut down on their own… and Gary’s NOT an unsuccessful newsletter writer.

    You seem to have an agenda. The guy’s stated very clearly what the risks are following his personal investing methodology, and anyone who can’t “man up” and accept that they can’t ride the bull should take their ball and go home.

    Also, for anyone interested in a ridiculously-lucrative private gold mining operation, please email me; this isn’t for the liquidity junkies out there, but the upside is several fold greater than anything available in the capital markets.

  246. Nike Boy2008

    I have to admit..I’m paralyzed

    this one hit a little too close to home

    never seen anything like this

    will wait for the bounce to sell nonethless

  247. Ben

    Gary DID say there would be howling about the D-wave on this correction. I couldn’t grasp how that could be so, because I had no context. In the next four weeks, if the C-wave has another powerful push, I will have gained that context. And because I chose to listen, I will have profited.

  248. Canuck99

    Pretty disappointing reading some of the comments. Everyone is responsible for their own accounts. If you followed Gary blindly that’s your problem. You can use Gary’s cycles as an addition to your own analysis but any trader/investor who doesn’t have their own plan will lose at this game over the long run.

  249. Cory

    After getting hit in Fall of 08 like everyone else, I came across Gary and Doc. I had 2 million in trading capital, which I added to at Intermediate cycle lows over the years. I’m not bragging, I took huge hits in my early trading years with options and daytrading. I went Old Turkey with Gary and it was the best thing I ever did. Just wanted to add the T1 thing, because it happens all the time in a bull market. Move up, consolidate, equal move up, drop back to consolidation. It just happened fast this time and people were overleveraged or late buyers and it happens. But read Gary’s T1 if you haven’t, and then look at AGQ chart and its picture perfect.

  250. catbird

    Well, I’ve decided not to buy a penny more of anything until Gary is satisfied that GOLD (Au) has printed a cycle low.

  251. YesLetsDiscuss

    Look, Gary did his analysis and informed us about it. We did our own trades. Some suffered more than others.

    Its not ok to say Gary misled us. Its ok to say what Gary said didn’t work out, although we don’t quite know it yet. Even if it works out, its ok to say we shouldn’t have subjected ourselves to such a draw down.

    Its not ok to say Gary’s cycle analysis is absolutely wrong, because it has been right so far. However, its not only ok, but we should actively work to figure out how to improve our tactics in our trading beyond and on the basis of Garys cycles.

    Its ok if Gary disagrees with some of these.

  252. Jennifer

    My biggest fear is, what if there is no bounce. Not for a while at least. I don’t want to lose more money than I started the year with.

  253. Movax2

    Bounce or new highs, I dunno, but I think we are at a bottom. I like the wedge forming ATM. Would be nice if it breaks up.

  254. Felix

    I didn’t liquidate. I will continue to shave off loss-bits as margin call comes in. I am down so far it would almost be idiotic to sell it!

    I have suffered plenty in other areas of life to know what that means, but I have RARELY suffered directly in my gut like this for *days* on end. Similar anxiety when a gun pointed at you, I wonder?

    Don’t know if I’ll have any money left when this is done, but I guess I’ve discovered some guts I thought I’d not be needing! Now to determine if I will also need a brain transplant after my heart bypass.

  255. ALEX

    GottahaveIt and DK

    I understand what you’re saying ( and thank you for including me with DG,POLY, etc) I love to exchange or even just share ideas to help others.
    I was a beginner once, and Paid a big tuition -2 yrs having trouble holding my gains. William O’Neil said I knew how to fly the plane…didnt know how to land it!
    translation: knew what to buy, didnt know when to lock in profits.

    I dont think Gary minds us posting on here at all -its just a little frustrating when he follows a trade recommendation with overly confident statements like “Throw your charts and tech analysis away…you will have NO advantage in this C-Wave” -claiming we are overly concerned about ‘little wiggles’…
    BUT Then he says — ” You own your own trades” ,
    then he says —” Stick to the plan”. I know he’s helping newer ones, but why slam us? We MAY have an advantage πŸ™‚

    I love his cycles analysis (and over all personality)-but still, I have to do it my way,and I’m glad he does let us share here.

    My Trader Rule #1…SET RISK parameters so you dont Over trade, but you’re $$ is safe. -Do not marry a stock.

    Rule #2- re evaluate daily-If its moving against you (EX-down on heavy vol) ask “Would I have bought it here , under THESE conditions?” –
    usually NOT if you thought you bought near a low…
    If not, its not doing what you expected. Sell it! / Clear your emotions? re-evaluate or look elsewhere. (AAHH, DO NOT SELL HERE, This IS where i would buy πŸ™‚

    OK , I rambled, I meant to say if comes to that , I’d be happy to help, but so far this works pretty well, W/ ocassional slam feedback πŸ™‚

  256. Hot Rod

    I just bought June 145 GLD calls, entering in with my high risk account.

    My heart is beating through my throat, my stomach feels like its in a blender and my hands are shaking.

    Didn’t I say the other day that I hate this game?

  257. GottaHaveIt

    Poly,

    I bought some GLD options last week at the same time you did, GLD June 140’s and a few 160’s.

    Are you still holding those or did you bail out?

    Also, what would be a good DITM GLD option to buy right now?

    Thanks!

  258. Poly

    “My biggest fear is, what if there is no bounce”

    There are no guarantees in markets/trading and one must do what they feel is right or best for ones self/family. If losing more right here will cause you hardship or if the money is owed/due elsewhere, you need to seriously think about your position.

  259. Jennifer

    Alex, so would you consider this still moving down on heavy volume? I really want to get out at this point. I have faith in Gary, buy I also have a hole in the pit of my stomach right now that is making it hard for me to live my life. I’m just about done having heart attacks for the week. I mean, If we are due for a big bounce why not sell out now and buy back in at the swing?

  260. Farm Girl

    Matthew – What exactly did you mean by “Gary has already crossed that line”

    He can write what he wants as long as he doesn’t give peronalized, individual advice.

  261. Jay Lin

    There is no doubt that long term investors with Gary have made a good money following his method. People who complain now are accusing Gary of not being perfect in his forecast. ( Because if he is 100% right, we can all leverage like crazy and be millionaires within this year! )

  262. T.J. Rand

    Jennifer-
    You may want think about selling a bit- enough to clear your head and put you back in control of your emotions.

    I had to do that – I’d rather not have sold, but it’s better for me to trim and then buy back after having recommitted to my thesis than to simply continue forward in a state of angst.

  263. catbird

    I’m one of the youngest and least experienced traders on here, but I (think) I have common sense.

    Let me just throw this out there, and then I need to step out.

    Don’t lose faith in Gary. He is right FAR more often then he is wrong. I think he WILL make us a lot more money in the months and years to come if we stick with him.

    Ah, but what do you need to stick with him? (well, other than the annual membership). You need CAPITAL.

    Your capital is your “chips” in this game. If you lose so much that the demands of living life in the Ben Bernank’s banana republic prevents you from trading with Gary, you are OUT OF THE GAME.

    You can always make money if you preserve enough chips to trade, and Gary will more often than not make us money.

    For me, I trimmed today because of my personal life constraints….I would still be up big, PLUS I could rest easy knowing I had enough cash to pay loans later this year. Simple. Not dictated by panic, but by my PERSONAL situation.

    Again, think of your PERSONAL situation. Think of how many “chips” you will need to keep playing along with Gary.

    Hope that helps some people as you decide what to do in the coming days.

    Now, I need to run an errand.

  264. Hot Rod

    Dear Mr. Billionaire (the one that helped me and my friends out last week),

    I know you did me a tremendous favor when I requested a convincing move past $1515 and I was amazed at how you were able to drive it up to $1575.

    I would ask that you please do whatever you can in your power to halt the bloodshed and get gold back over $1500 as a start.

    I would strongly recommend you pick up an enormous amount more physical at these prices as you have been doing over the past few days. Just about everyone out there is interested in selling it to you here.

    Much appreciated.

    Average Middle Class American

  265. GottaHaveIt

    FWIW,

    I am a HUGE silver bug (see my avatar) but I sold out all of my remaining AGQ yesterday in the AH.

    David Morgan says silver will trade in a narrow range for the next few MONTHS bewtween $34 to $42… and my stacker buddies are very bearish. That tells me the games is up for now.

    I do NOT expect silver to come rocketing back any time soon.

    However I am taking advantage of this dip to add to my physical stack. Bought another 500 ounces this morning at $36 spot. That is a LONG TERM hold (years) so I’m not worried about short term moves.

    As my stacker buddies say “BTFD!”
    (Buy The F**king Dip)

    I’m just passing this on for your consideration if you are thinking about getting back into AGQ.

    To use another stacker forum term: DYODD (Do Your Own Due Dillence).

  266. Jim

    More food for thought (and encouragement) from Ted Butler’s latest comments (4-May-11):

    ‘Even though silver investors feel frightened and crummy, my point is that never before have the commercial silver shorts taken such a financial beating. Even in the current sharp sell-off, which the commercials have induced and are buying into aggressively, they are still incurring steep losses, as these positions were largely sold short originally when silver was in the teens. I know silver investors are feeling financial anxiety currently, but it is important to remember the shorts have been savaged over the past 9 months. Most importantly, the commercial shorts have been proven to have been on the wrong side of the silver market and have moved aggressively to close out those losing short bets. This is unprecedented.

    Quite simply, the commercials have been buying on the way up in silver prices and are now buying on the way down. This should be confirmed in this week’s COT and Bank Participation Reports. When the commercials are buying silver no matter whether the market is surging or crashing, that sends out a strong signal. That signal is clear and unmistakable – the commercials expect much higher silver prices soon. No one buys anything in the expectation it will go down in price. The commercials are buying silver, collusively and urgently, because they believe the price will be substantially higher soon enough. Amid all the talk that the silver bubble has popped, the commercials are putting their money on the line and are buying silver like never before. This buying signal should not be ignored.’

    Later, in the same article, he writes:

    ‘As I write this, the price of silver is still in a free fall, trading below $40. I can’t tell you what the absolute price bottom will be, but I think I can tell you some other things. My sense is that the market is close to exhausting itself on the downside. I do know that all past price smashes in silver over the years end when the last possible speculator liquidates or goes short. The COTs say we are close to that, if not already there. The thought of selling here is out of the question for me. It’s more a matter of what to buy.

    Based upon the market structure and my take on the physical shortage, I’m convinced that when the turn to the upside comes in silver, that turn up is going to be dramatic. I think there is a good chance that we will then go up as fast, or faster, than we just went down. I base that on the unwillingness of the commercials to ever go short big in silver again. These commercials will not put themselves in the same short position they have been in over the past 9 months. I’m sure they feel fortunate to have eliminated as many shorts as they have, even though it cost them a boatload of money. Their lack of selling in the future will create a vacuum on the upside that will allow prices to soar.’

  267. D. Saul Weiner

    For those out there who are (understandably) discouraged now, I would like to bring an encouraging development to your attention. Though Gold is obviously down big today, call options on GDX are pretty much flat. Sign of expectations for improvement …

  268. pimaCanyon

    T&J,

    The way I read the post was that its purpose was to show what was accomplished by following Gary’s calls.

    You, however, just assumed the post was all about bragging. Or maybe your blog lie detector gives you a reading on intent as well?

    Very handy tool, that thing is. Although it doesn’t have a whole lot of practical value really, unless you just enjoy taking potshots at other people’s posts here and elsewhere.

  269. drsadov

    DG,

    it seems doc believe it may be so but still need confirmation… I think volume has spiked in UUP, also what Gary was looking for?

    Sheesh…

  270. pimaCanyon

    TJ,

    Good plan about trimming. I did a little of that today. My only regret is that I didn’t start earlier, as in yesterday or the day before. One thing that prevented me was fear of selling at the bottom. But guess what, you don’t have to sell everything! Sell it piecemeal, stop the arterial bleeding, slow it down to a trickle. You can always put back on the positions you sold and maybe even at a better price.

  271. Jim

    Lastly, Ted finished the 4-May-11 article with:

    ‘The facts are that silver is better positioned than it has ever been. This sell-off has hurt silvers investors financially and especially emotionally. That will soon be over and the important issue is not to lose positions. It is the silver price climb that is not over and is, in fact, made better by this week’s developments. It’s not just that the price is cheaper, it’s much more important that the overall conditions are better.’

  272. wingwalker

    Wes,
    I hear you, it feels like alot of trapped longs have been taken out in body bags. But alot were not margin called so if they hold – once they get back to breakeven it’s bye bye.

  273. Jim

    For those who have not seen it yet, here is a comment about Silver (and miners) from Jim Sinclair, made last night:

    http://jsmineset.com/2011/05/04/silver-being-silver/

    Partial quote:

    ‘After this short play, which had to follow the spike intermediary top, silver will rise as fast as it did again.

    The Hedgies are having their way with the gold shares, but logically this is coming to an end. When you can buy companies whose resources are three times the company’s present capitalization, the share is getting unreasonably cheap.

    The ratio of GDX versus GDXJ is starting to favor the juniors which is a major heads up event.’

  274. aklaunch

    I have lost my ass. But i will ride this ship down. I am not doing anything until i see gold absolutely crap itself. And i have not seen that yet. Gary says 3-5 day corrections will be the norm and until we go past that i will hold. Most people here seem to know that Gold and Silver are in a long time bull market? If that is the case we can be millionaires another time if the worst case scenario happens here. Maybe we will be wiser and keep a bit more in our personal bank accounts. I know i will. Then on the other hand this ship could turn around and i could be chomping at the bit to add margin.

    I must admit even losing a huge chunk of hard earned change had been a good moral lesson on the basic human emotions of greed and fear.

    I am scared but will hold with Gary right or wrong. We will make it all back plus a whole lot more.

  275. oa92000

    gary
    I am looking at $HUI July, 2010. The chart looks similar. Does that mean we have to wait for another 2 weeks, before $HUI take off??

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