127 thoughts on “PORTFOLIO CHANGE

  1. Jason

    I heard mention of some economic reports coming out tomorrow. Or was it today? I forgot, can anyone remind me what’s going on tomorrow?

  2. Larry


    Not sure if I’ve ever directed a comment towards you… so hello!

    What do you have your eyes on in the morning if we get a good opening puke out…


  3. Avann

    Why would CEF be outperforming the double ETF’s?

    HBU up 3.69%
    HZU up 1.87%

    CEF up 3.86%

    I understand it’s 50/50 gold/silver but it’s not leveraged so why the overperformance?

  4. Shalom Bernanke


    No, I’m focused on miners this round, and hopefully for the rest of the secular bull in gold/silver.

    Not interested in the general market, although it will affect my miners to some extent.

  5. Keys

    Gary you are doing a great job…I think I am just going to igonre the BS from now on…I really appreciate the debate on your calls, just to test holes…but the toungue sticking out stuff is going to get me pissed off again…and I would rather not go that route again.

    Either way as for myself, I bought some TLT, and sold some covered calls at 110 on half the position…the weekly TLT is offering over 2$ on the 110 for a week! I will take that dab. Pure trade too…I hate bonds!

    I am long gold as I mentioned before, sold my puts, and am treating the 100$ suprise gain per ounce as my buffer.

    I am treating this as a fear trade market…so until proven wrong…and if I am wrong! Wow I guess I made a booboo and need to submit myself to brutual thrashings with a cane…Okay enough of that!

    Good luck all…

    PS Gary’s best call was to tell everyone to get the heck out of the market and go cash for their retirement funds. NOW that was a brilliant call…and your gold stuff was good too!

  6. Gary

    The Philly Fed index came out this morning with a huge downside surprise. It’s now at levels that have marked all previous recessions.

  7. ver

    (reposting comment)


    You’re slowly converting me into a fan of them miners 🙂 They’ve held their own despite the market’s vicious turns over the last two weeks, and they even seem to be itching for a breakout. If gold does make a parabolic move from here it may be the catalyst, though then again one would have hoped the last few $100 in gold would have been enough. In any event, I’m contemplating a small position here but only on a panic sell. Will be keeping an eye out for your next move.

  8. Shalom Bernanke


    I’ll post in the morning as I buy ’em, if I get the oppty. I haven’t yet decided as I have a few new names (larger cap) that I want to add, but they haven’t pulled back enough.

    Other than that, I’ll keep my eyes peeled for UXG, SVM, maybe EXK, and a light chance (if it gets ugly enough) of buying some NUGT.

    Sizing is everything.

  9. Dan


    Your not factoring in changes in CAD/USD exchange rate. Secondary reason is CEF sometimes trades at premium/discount.

  10. Avann

    Thanks Dan but wouldn’t that factor into the Canadian ETF’s as well?
    It just keeps rolling along it’s up over $1.11 now at 4.7%.

  11. Gary

    I think some folks are missing the obvious.

    Gold is obviously in the final parabolic phase of a 2 1/2 year C-wave.

    The continued divergence in miners and silver, in my opinion, is pricing in a collapse of this parabola sometime in the not-too-distant future.

    A severe D-Wave correction always follows a parabolic C-wave top. So unless you think mining stocks are going to rise during a five or 600 point correction in gold you might want to think twice before loading up on mining stocks.

    At this point we are just playing chicken with the gold parabola.

    Everyone needs to be fully aware of what is coming and adjust your position sizes accordingly in case you get caught at the top.

  12. Shalom Bernanke

    It’s also possible gold doesn’t go much higher, and that miners catch up to some degree. Miners are piling up cash with metals at these prices. Even if gold doesn’t move, miners could rip.

    Not saying they will, just comfortable with the possibilities.

    Gary’s right though, “loading up” is a probably a mistake, and not just now, but always in any trade.

  13. Gary

    Today is probably going to be a 95 to 98% down volume day. It’s not unusual to get some kind of relief bounce after that kind of panic selling. It looks like some players are setting up for that bounce.

    I would really like to see a 400-600 million BoW day and a swing low before I would consider reentering the stock market.

  14. auger

    Yes, totally agree with Gary, about miners. Loading up on miners, right now, is not the play. Look at SLW’s divergence to PM’s, right now, something is happening…

  15. ver

    Agreed, not advocating backing up the truck on the miners. Just pointing out that pricing in the D-wave for half a year also suggests prices may be depressed, especially if folks are trying to position *now* for another $100-$200 run in gold.

    Miners marched to their own tune while gold went through it’s nasty correction last week. It’s possible they could do the same if gold corrects or catch up while gold consolidates at higher levels.

    Current weakness in the miners is in no small part a result of panic selling in the broader the market. Perhaps it’s more than that, but if that’s the case trying to add a position in gold now is not any more sensible to me.

  16. Shalom Bernanke

    Many of the miners I trade have +/- 20% moves in a week. Be sure to factor in that volatility and trade sizes that won’t cloud your judgement and force errors.

  17. ver

    In any event, I’m on the sidelines until tomorrow to see how things play out in gold and the market. SPY is at the top of the BOW list at $90, $218.30 in block trades. Another down day with large BOW numbers and I’ll be looking for bargains in the market over metals.

  18. PST

    Financials make up about 20% of the S&P, so any fund that has large short positions in individual financial names can hedge their exposure by going long SPY

  19. St. Deluise

    volume on last hour’s green bar (SPY) largest since the fed announcement.

    the 4:15-20 million share trader’s back too, 2 buys @ 1 mil then one sell at 2mil within 4 minutes. testing for supply/demand?

    oh and there just went a 4 mil purchase.

  20. PST

    St D,
    Relative value arb guys often use these index tracking ETFs rather than other securities within a specific sector

  21. St. Deluise

    yep.. just trying to quantify jesse livermore’s ‘least resistance’ theory.

    like in the last 5 minutes- a 1M buy order pushed (ate through order book) price 20 cents up. conversely a 5M sell order pushed it down 12 cents. in that period of time there there was more buying pressure than selling => bullish.

    this screenshot i posted last night (http://i54.tinypic.com/262uuy9.png) seems to show that the equivalent sized buy orders didn’t budge price up at all, and in some cases paradoxically lowered it. not bullish. and we all know what happened today.

    might start taking some rough notes at each close, or does anyone know a free place online that catalogs time&sales for SPY?

  22. Mighty

    Alright, missing the boat on the last 2 trade calls has me finally willing to sign up for Twitter, against my general disdain for its common use.

    I know you all have instructed others in the past, but would someone be so kind as to tell me how I make myself available to Gary’s “tweets”?

    Many thanks

  23. liquid


    Your assessment is spot on. The calls were missed. period. Doesn’t mean a thing about a thing, but without question, missed.

  24. Gary

    You are mistaking my expectation of what would happen from how I trade.

    If I expect a correction in silver or gold that doesn’t mean to sell short. I’ve said a 1000 times not to short a bull market.

    If I buy the Q’s because it looks like an intermediate bottom is in place but then sell them for a small profit because the market isn’t doing what it should be doing, it’s still a profitable trade even though the market didn’t do what I expected.

    Your problem is you are trying to take low percentage trades based on expectations.

    The fact is that the model portfolio is making money in a very tough market. If you are doing something different than the model portfolio, who’s fault is that?

    I think you need to take responsibility for your own trades as you obviously aren’t following mine.

  25. Gary

    Hell just the call to get out of stocks in one’s 401(k) account alone would be worth 10 times the price of a subscription.

    On top of that the model portfolio is making money this year, which is better than probably 95% of the investors in the world right now.

    What more do you want?

  26. Felix

    Gary, can you explain what happens if you short a bull market when you think you have probability of a low, a rubberband stretch, etc. – why is it riskier to wait for the drop back to your price?

  27. Felix

    Yes and no; I mean, it continues to stretch and stretch to unbelievable levels that still demand the snapback eventually, don’t they? Just asking to understand, not argue.

  28. Felix

    I’m interested in your experience with it as a successful trader more than some kind of TA.

    But anyway, thanks a mint for getting us out yesterday, *whew*!


  29. Gary

    You’re welcome.

    Apparently that wasn’t good enough for T and liquid though :~)

    Nothing less than perfection will be accepted. Good luck with that!

  30. Keys

    Don’t worry that 10% position in GLD will guarantee more bickering….if it makes money, why didn’t you go all in…if it doesn’t work, another call that was wrong….

    Man I don’t think I would have the patience for that day in day out!

  31. Gary

    Yes everyone wants to ride the parabola all the way to the top and conveniently forgets all the warning signs that happen in real time.

    It’s always easy to play Monday morning quarterback. Unfortunately I have to do this in real time.

    And the most important consideration right now is not trying to catch all of the gold parabola, it’s making sure we don’t get caught when it crashes.

  32. Shalom Bernanke

    Well said, Keys. It’s hard enough to trade our own accounts properly (in private), I believe most people have no idea how difficult Gary’s situation is. People’s emails must be even worse than their comments here, and no mater how tough somebody is, these things can throw off his own trading.

  33. Robert

    I followed the model portfolio on the last three trades. Made money on each trade. No complaints. Took a small position in GLD at closing today. Fingers crossed. This is exactly the type of trade that I want Gary to get me out of early.

  34. torero91

    I really enjoy reading your thoughts on the metals complex. That’s why I subscribe. You made a great entry with silver earlier in the year, but the exit was a tough one. The trade was very profitable, however, and that’s really all that matters.

    My issues have been with your general stock market calls. I have always provided my rationale in disagreement. We were in a bull until we had bearish confirmation. Some of the major indications of a top over the last 75+ years were missing. This time really was different. A trader goes with the probabilities. Nothing is 100% certain. The question that remains in my mind is do we have a “flash bear” here, much like 1987, or something more typical along the average span of 17 months or so. Time will tell. My positional buy signal never arrived, so I’m still mostly out of longs. Let’s see if last week’s lows hold on the coming retest and assess the nature of this bear as it evolves.

  35. Shalom Bernanke


    If you took a small position you should have no worries regardless of where gold goes. To put a time constraint on Gary by saying you want him to get you out early is exactly what will make your returns suffer over time. What is early or late can only be known in hindsight.

    I’m not picking on you but only making a point. Proper sizing is the real issue for every trader, and going in light like you did gives you better perspective. Rather than thinking of when you can get out early enough, you might also consider that if gold ran $200 and then pulled back $150 could you add there, instead of whether you sold a small position $200 higher. 🙂

  36. Robert

    Appreciate your comments and do not feel picked on. My expectation is that this will be a short term trade and of course I want to exit before any major correction.
    Did not mean to confer any pressure on Gary to get me out early in fact I sold my stake in QQQ the day before Gary said to sell. The comment was meant more to back Gary’s previously stated strategy to not hold on to positions until the last penny is made.

  37. wolf33

    therewas a diamiond silver trianggle whereby silver has broken out to the upside. i think ithat silver will start doing better and for awhile even outperform gold. and i see nothing that disrupts the 65 day cycle from low to high. but trust me, i will stick with pivots and if get a sell i will sell.

    so both silver and gold on buys with silver being 4 days ago and gold 7-5. i would like to see silver break throug 42.29.

    but always remember predict for show–react for dough.

  38. wolf33

    actually silver broke out to upside from a diamond formation as well. this was more significant.

    silver has to be thought of as a monetary unit for it to get to the 44-46 area relatively soon.

  39. Poly

    Gary, let’s hope you’re right too. I jumped back in This morning with some Oct calls (aggressive/small position) and some longer deep calls out to 2012. Balanced with some weekly’s in case we indeed see a DCL, which would need to come ASAP. No need to get crazy though, if it goes parabolic on us, a modest stake will light up like a Christmas tree.

    Good luck all.

  40. deshy

    Poly: Not trying to follow you just interested in learning. What are “Balanced with some weekly’s”? What time frame and how deep in or out of the money are these?

  41. Silverhound


    Is your cycle guy using the 60 day Gann rule?
    If a chart trends up for 30 days and has a small correction the continues higher it will run for another 30 days.

  42. wolf33



    although i do monitor gann but i seem to see them make constant changes like changing highs to lows etc. too wishy washy for me—although eventually get it right, i suppose.

    fib retracemens useful—like .383 now but only using very short term time periods. some even intra day.

  43. wolf33

    miners—–if not nationalized which would send gold price to the moon are going to have huge cash flows. Hedgies could get caught on this one. Neverthless feel more comfort with physical play.

  44. sophia

    I am sure that Gary will be right on his call again, but I don’t have the guts to follow him on this one.
    My reasoning is that the stockmarket selloff is now overdone.
    Dax lost 24% in 8 weeks! Germany is growing nicely despite the summer slowdown, still exporting to China which is growing at ( only) 9.2%, creating jobs ( unemployment at lowest in 10 years).
    France is OK as well, economy weaker but not down.
    Bottomline, we are etting too pessimistic.

  45. Silverhound


    ok thanks for your reply.

    re Gann: I think it’s like any form of T/A. Many jump on the bandwagon but only a few really know how to use it so T/A gets a bad name. A bit like how posts get distorted on this blog 🙂

    Luck with your trades

  46. RJ

    I just had one of those “holy shit” moments.

    An ounce of gold is One thousand eight hundred forty dollars.

    Is this serious?

    How is anyone going to afford a ring or jewelry anymore?

    That is a lot of cash, and even if the dollar is being debased, our salaries are not going up nearly as fast.

    BTW – groceries at stop and shop went up big time last week. Jar of pickles now $3.49 for mini ones…

  47. sophia

    No no RJ, you don’t get it, Bernanke says that there is NO inflation!


    I agree with you, here in the UK, grocerie shopping has been very expensive for 6 -9 months already

  48. RJ


    Yeah, its complete bullshit.

    How about Bachman today saying if she is president she’ll get $2 gas.

    Does she have any idea about how economics works? So, she is saying that she will drive us into a severe depression….?

    All the republicans are a joke. Everything is a joke.

    I’m too young to really understand what’s going to happen here.

    Are we going to look back at some point and say that these were the good ‘ole days? Or are we just going through a rough patch now?

  49. Gary

    We are going through the deleveraging process that must follow the bursting of a credit bubble.

    Because we are trying to fight the cleansing process we are going to create another depression.

    We had our chance in 2002 to make the right choice but Greenspan blew it. Now we are on a path that ultimately leads to more pain than any of us care to imagine, and I suspect probably World War III.

  50. Gary

    Yes I remember Plunger telling me we would never see $100 days in gold. I must admit it came quicker than I thought it would.

    In the bubble phase we may see $1000 days.

  51. wolf33

    for intra day trading tomorrow at this point shorting broads looks best. but no way in xell if vix gets to upper 40s.

    trin could be useful fot bounce if 5 or higher with vix 47+.

    or just watch the game may be wisest.

    i always write down some trading ideas night before.

    fas-short but doubt if you can borrow stock

    auy–best looking miner.

    i am done 4 tonight.



    omgolly over 1845

  52. Natanarchist

    @ RJ..you are living through a major paradigm shift.

    a point re Gary’s silver call…again…For at least two weeks prior to silver crash, Gary was warning that it would eventually just crash. About a week before it crashed he began outlining a plan on EXCITING silver at 50 and switching to gold..remember this was when everyone else was calling for 55, 60, 70 dollar silver. He PUBLISHED his plan in advance. there was no missed call. To be a sub and believe the call was missed you need to look far beyond Gary for the error. You might want to sue your school system for failing to teach you reading comprehension.

    Even if one is relatively new, last 6-12 months..if you followed the portfolio, you made money.

    SB..agree with your remarks about this topic. Risk control and position size. I learned that the hard way..haha. I also agree that a lot of folks want to trade in and out of things and it gets distracting, especially for me..and I don’t even make those trades, so I am sure if effects Gary to some extent. Oh and the last trade..the Q, I went with SSO in my kids account. 50 shares, closed on Gary’s call with a 4.18 a share profit. Not taking the gold trade..sit and wait.

    Plunger..where are you? I remember those debates Gary. And you always preached that by being old turkey and gaining strong hand status, one wouldn’t fret when those 50-100 dollar day moves come.

    And for the dissenters, you can post almost anything on gary’s blog…try doing that on any other blog, financial or otherwise, and see what happens. But if you don’t back up your claims, expect to get rebutted.

  53. Gary

    I have always said that I would try to completely avoid a D-Wave decline. A D-Wave can turn strong hand status into mush in a matter of weeks.

  54. Natanarchist

    yes, that is true..avoid the D waves for trading..I hold my physical through the D waves. I have no gold trading position at the moment. I can twiddle my thumbs until the right buying opportunity presents itself.

  55. Natanarchist

    and for some anecdotal information, one of the largest “Cash for Gold” companies has tripled their order for checks….that tells me the public is still selling their gold. Lots of time left in this bull.

  56. james r

    Hi Gary,

    Great call on the QQQ’s.


    Do you think the markets will make a marginal high by the end of this year or will any rally be shorted and lower highs are what’s coming this year.


  57. Mighty

    Okay, I need input here from the pros. I missed the call to sell QQQ in time to take the profit. Now I’m not sure if its better to sell tomorrow or hold through whatever may be coming.
    I’ve read the post but still am not clear. Is there a signal I should be looking for at the open to indicate which move to take?
    Many thanks

  58. trond56

    Gary, in the 70’s the bullmarket started in 1971 and topped after 9 years in 1980. The present bull started in 2001 and could top after 9+ years like in the 70’s (i.e now)?

  59. Gold Lion

    WTF? Foebes says..

    There’s a high amount of open interest – 14,532 contracts, says The Financial Times – in December 2011 gold calls with a strike price of $3,000. That’s a lot of people counting on nearly a double in four months.

    Some one know something? The article also says mining stocks about to catch on too.

  60. Dubbelito

    Gold Lion,
    can’t speak for the North Americans, but here in Europe I would venture a guess that the ETF’s will be the choice over miners for some time still. Direct correlation to the price and no corporate risk involved (i.e. mis-management, busted projects, etc. etc.)

  61. Shalom Bernanke


    Unless those etfs don’t have the gold they say they do. Increasing dividends will also pull people from the etfs at some point. Check out Homestake’s dividends in the Great Depression.

    Last point, gold might take a breather even if it doesn’t sharply correct. In this situation I would think some will pull money from the etfs and put into miners. I did this myself in the last week or two when I sold 30% of my PHYS.

  62. Harry

    I have news for you guys – the gold parabola is not going to make it until a week from Sunday. We’re currently rising at a rate of close to 4%/day and counting. That could get us well into the $1900s before the close tomorrow. I do not anticipate us getting much past there. $2000 in gold is like $50 in silver.

    Once the parabola breaks it’s D-wave time, no questions asked. I suspect that if/when QE3 is announced the following week gold will get some mild bounce before everyone realizes the buyers are all gone and the flow out of gold and into stocks will commence in earnest.

  63. Wav_ridah

    I wouldn’t short oil here. H&S top on USO targeted about a 22% drop and that ended up being about 78 on oil. Target was met. I wouldn’t bet on it going any lower than that for the time being.

  64. Dubbelito

    yes that might happen, but what I see is people that have no clue how to invest; these ones will pile into the ETF’s because that is what the advisors say (and sell…).

    Furthermore, it’s different because the majority of the big boys (and quality juniors) are located in North America, so for you to invest it is zero fx exposure, but when I invest on TSX in Canada I have to use CAD, so I can lose out due to fx movements even though fundos for the company iteslf were golden.

  65. JG

    Harry siad..
    ‘I have news for you guys – the gold parabola is not going to make it until a week from Sunday.’

    How can you say that, fact of the matter is no one knows when this run will stop problems in europe could easily see it going like it did in 1979 / 80.

    You can just sit there and watch this train go by or you can make a plan about getting on board that will limit your losses. I’ve been watching this bull for to many years to risk missing it.

    I’ve laid down the 1st 10% and I will continue to lay down another for each 100 it goes up with a large enough stop loss trailing.

  66. Shalom Bernanke


    I own EXK, SVM, UXG, GPL, and little NGD which I’m looking to add to.

    Some other names I do not yet own, but will buy into a correction of a few days or more, are AUY, IAG, and OSK.TO

    Although it could happen, I don’t expect to get paid right away. Even into rallies I will not sell, only looking to buy into weakness for some time.

    Good luck.

  67. Rishi

    Broken parabola in silver has retraced more than 50% from the highs…next target 61%..Gary, if broken parabolas never tests new highs for atleast a year, then shouldnt we be shorting silver heavily close to the 61% mark?

  68. Shalom Bernanke


    I’m also interested in one of Alex’s favorites RIC, but will only buy into a sharp miner pukeout as it’s much less liquid than the other names I mentioned.

    Keep in mind my expected hold times are longer than usual for these positions (and for most traders here), and I don’t mind being a little early.

    I feel safer in miners than dollar confetti, as strange as that sounds. 🙂

  69. Harry

    JG, I’ve had an open futures position of some kind for every minute of this run since $1526. I’m down to a single contract at this time.

  70. Dubbelito

    It looks like silver is actually following big daddy this week and have shaken off its industrial skin for now… Could this be indicative that the real blow-off top in gold is yet to be reached I wonder?

  71. Gold Lion

    My Auto Trader system gave buy signals on AAU, CDE, GDXJ, SLV, VGZ, NXG and RBY in the last few days. That system trades a lot but is up 600% since beginning of 09. Warning though, it is only 40/60 winning trades to losing trades.

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