1,012 thoughts on “PORTFOLIO CHANGE”

  6. Dave

    Made at 3:57?! Since I’ve never placed an after-hours order, should we leave it to get filled on the open or strategically place it sometime in the morning?

  7. Rob

    Gary,

    Very impressive. From what I could glean from your public comments you were spot on. I’m now a new subscriber.

  9. William Wallace

    Couldn’t be more dead on Troy!!

    Troy said…
    Gary,

    I just read your message about the grief you are getting.

    For every 1 that gives you grief there are 10 of us that are learning and have profited from your service.

    DON’T LET THE IDIOTS GET YOU DOWN.”

  12. St. Deluise

    kaboom! missed one of my SSO fills by 26 cents but bought more before the close. first dip tomorrow i fill out the remainder.

    i think gary deserves some props here. especially with all the zazzing he took yesterday.

  16. St. Deluise

    PLUS this SoS thing is neat and all but if you actually look at effective volume, or hell even accum/dist and not some wonky php code on a website, it’s on like calgone.

    that new low was not sold into at all. even stronger divergence than the june 23 low.

  19. SW

    Gary,

    In case you thought my post is a grief, it is not. I went short at $1665 last Friday and I just had to laugh at the ridiculous up move. Just want to make it clear 🙂 Boy, it is really hard to short a parabola.

    here’s my post an hour ago:
    sp down, gold up. sp up, gold up. hahaha, ridiculously strong. maybe no down move until margin increase.

  24. 86d4life

    Low Tax,
    just funnin as usual. It feels good to have the stress bleeding off. Every time I thoght we hit bottom, I`ve been adding a little long. By 3;45, I was getting wound a little tight. But you, listen to Gary. Added QLD into my IRA this morning at 69.15. Cool. Thank you Gary.

  25. St. Deluise

    if there’s no dip i guess i’ll just live with my half position. if tomorrow seems like a trend day maybe i’ll go to 3/4 early on.

    i’m not super excited about being long here, mind you. i think most people know this is just is sort of a BS rally.

  27. William Wallace

    SW,

    Its impossible to short a parabola, unless you are shorting on certain days within channels…anyone who thinks that they can short a whole decline of a parabola is simply nuts, its impossible…you will lose all your money before you catch the top

  28. Mean Guy

    Bought beat up shit yesterday & today AKS WLT DD also a SH hedge on the FEDS that I had to pull out of the fire, overall good day see what happens now.
    Thanks Gary

  30. LowTax

    Gary, SOS on SPY is -$410… I know these things are terribly predictive but that’s a big number. And we haven’t hit the last update for today…

  36. Dan

    Loaded up on QLD also although still wanted to buy a few % more but ran out of time.

    Added some DZZ also…just to keep things interesting 😉

  37. Silverman

    Gary,

    Been a subscriber for about a year. Nobody is going to get all the calls correct. Bottom line for me is that my account is worth quite a bit more due to your guidance than it would have been without you. I will be renewing my subscription when it comes due (no brainer).

    Thanks for doing what you do. Stay focused and let your long term track record do the talking.

  38. Mean Guy

    Ain’t this great yesterday i was Herbert Hoover, Today Gordon Geiko, I love the smell of fear it smells like money. Until tomorrow who knows what it smells like. S&P 1170 8/2010,09/2008,05/2009,11/2004,8/2001,12/1998 I thing they were all Tuesdays

  39. marksomething

    how about a disclaimer every ten posts reminding folks that gary is giving advice based on his experience and education.

    Gary doesn’t control your trades and isn’t a broker… his fees for that service will undoubtedly would be far too high for 95% of us here. yuck yuck.

    if you do not like his calls ignore his advice. also, deluding oneself into believing your posts are for the benefit of all is, in my opinion self-aggrandizing.

    1 do stop buggin’ Gary
    2 do stop speaking for anyone but yourself
    3 conduct yourself as an adult
    4 be interesting and engaging

    This post has been brought to you by the letter M

  40. sophia

    At ease,

    Thanks for your kind thoughts

    In France at the moment. But apparentely curfew in some places close to London….Martial Law in the UK, unbelievable

  41. ...at ease

    Sophia,
    We just arrived back home today in Ruislip, they had closed down businesses early and are boarding up storefronts. Evidently organized riots expected throughout different areas in London. So far it’s been quiet this evening here. Perhaps with more police and alerts it may calm down. Glad to hear you are in a safe place. Worrisome times.

  42. DG

    Wow! My best day since the glory days of AGQ. Should be a rocket ride to the 200DMA. Gary got this just right. Very few writers did. Anyone who is still complaining is just out to lunch. If you refuse to buy during fear and insist on buying during exuberance no one can help you avoid losing money. Use Gary to get the guts to do both.

  44. trader

    Today would be day 38 of the 40-45 day cycle. So im thinking maybe a little more volatility ahead. Perhaps the reports out of the US are trying to add additional confusion by saying that more austerity measures are required and people like me wait and miss the boat. I have to remember though that going long in a bear market is ultimately a sin and whilst risk is on, gravity is pulling her down.

  45. SW

    William Wallace,

    Yeah, It looked like a reversal last Thursday, so I thought the top was in. More, I didn’t scale but all in. I will learn my lesson if this yellow monster continues. If not, thank god and scale out until it hits Gary’s D-wave target!

  46. aurum

    Great calls Gary! Thank you so much for your service.

    Been a subscriber for a while now at the premium site, but – do you think there is any way you could tell the crowd (in a nice way, of course) to keep the off topic comments to the blog? It would be so much easier to follow. I love it all, but… it’s a bit much to read it all when it’s not really about your report…

    Love the crowd lots, but it would be great to be able to choose when to read the chat (here) and when to read the more on topic stuff.

  47. oa92000

    Everybody knows the bounce is coming. The market is extremely oversold, but it is hard to get the exact bottom. Russell 2000 rally 5% in the last 20 minutes of the day, but tomorrow, who knows??

    Cory , do you add any RWM for this bounce??

  50. Felix

    Gary – Don’t let it get to you when people are down – they’re down because they’re still learning about controlling their emotions while trading, and that’s a big part of what we are learning from you. I have already learned a mountain’s worth.

    Anonymous 24/7 blogs mean some are just going to post their feelings in-the-moment even though they should be more careful. Remember, they think they’re at home in their bedroom in their skivvies, not addressing a worthy guru. Please don’t quit! You are a success: If one of us can’t figure out how to make your moves successful in our own portfolio, he should find someone suited to his temperament.

  52. William Wallace

    Gary,

    Its sad to hear that so few are getting to you and causing you even the slightest bit of grief, but it is understandable….but there is one thing you need to keep clear in your mind, you are helping people make money during really hard times, me and my family are very grateful and wish we could some how repay you, but what can we do other than express our gratitude with only words? There is not much more we can do and only hope that in our heartfelt thanks you keep this truth forefront in your mind and heart. Your commitment to your subscribers from what I have witnessed in the short time that I have been a sub is unparelleled to say the least, and im certain that many of us have no problem saying…we not only appreciate your knowledge and experience, but also your calm and commitment to sharing these amazing attributes with us. Thank you Gary.

  53. Danno

    If you guys believe PMs are going much higher and you don’t want to sell (but you are worried) protect yourself by hedging a little. Then you win either way. If PMs skyrocket your gains will eclipse the pittance you paid for puts. And if PMs tank your hedge will erupt in value, wiping out most if not all paper losses in your longs. And now with inverse x2 and x3 ETFs out there you don’t even need to buy puts and worry about expiration dates.

  55. Danno

    Let me put it another way. If you trade and you do not hedge… you are only one lousy trade away from destroying your brokerage account for years. Stop losses will not always save you, especially in a runaway market. You are NUTS if you don’t hedge. Totally nuts. Capital preservation is always Rule # 1. Before all other rules.

  58. aklaunch

    Be careful on shorting silver here. Silver is more fond of a weaker dollar and likes to run with the general market better than gold.

    Disclaimer: I am usually wrong….

  59. Le Fou

    alijowa,

    SOS = Selling on Strength. The Wall Street Journal publishes this stat here:

    http://preview.tinyurl.com/5pngkn

    Large SOS numbers indicate distribution by institutional players and indicate a reversal is on the way.

    The reverse is BOW = Buying On Weakness. It’s found in a tab on the same WSJ page.

    Good trading,
    Le Fou

  65. David and Courtney

    question about my trade – placed trade when saw the portfolio change, it got in at 4:01, i placed it market-day order. now it is unfilled and there’s a link that says ‘attempt to cancel.’ will this trade automatically place at the open or since it’s time period is ‘day’ will it go away tonight and i need to get another one in for on the open tomorrow. thanks for your help!

  67. catbird

    Danno,

    re: hedging…

    I don’t really see the point if one’s account is not big enough to move the market.

    If you’re long QQQ or GLD (or whatever) and you don’t want to get killed if the trade goes against you, why not just reduce your position size?

  70. Danno

    @Catbird

    “I don’t really see the point if one’s account is not big enough to move the market.”

    I’m not sure I follow you. My point was simply that hedging (for the average Joe) is about insuring yourself against calamity. Hedging should be done even when you are absolutely SURE you are right, not just when you are worried and have reduced the size of your position. Hedging should always be done, at all times. Not only can hedging save your account, it can also make you a lot of money if there is a totally unexpected and violent swing of significance.

  71. catbird

    Danno,

    I assumed you meant (for example) that if you are a gold bull and hence are long a lot of GLD, you should also hedge with some GLD puts.

    And my take is, why not just sell some of your GLD? Doesn’t that accomplish the same thing?

  72. St. Deluise

    i’m with catbird. hedging is for people who can’t move in and out willy-nilly. which is none of us.

    when i’m unsure of my position, i lighten it or sell it altogether.

  73. Veronica

    Sell on my system is really flying up now and is at 1670. If it sells tomorrow it would be a $150+ gain, it’s largest ever.It is currently on day 26 and we NEED some down movement soon to avoid a major parabolic top.

  74. Hack

    A monkey could throw darts in todays market and make money. But how many folks shorted the market last month? Now that takes brains.

  77. Ken

    I was 100% short from June 2nd and closed them out yesterday before Obama spoke and got long 58% on yesterday’s close. I bought the other 42% before today’s FOMC annoucement and crapped my pants when we rolled over. I turned the computer off and missed the last hour rocket shot only to see my all my trades go from red to green. I’m up close to 28% YTD and should we get back to the 200 DMA I’ll be 35%+ and plan on jumping back into PSQ, DOG, SH, RWM or maybe going ‘Old Turkey’ the next 1 1/2 years BEARX or GRZZX. I’m looking to scale out of longs at the 200 DMA and back into inverse ETF’s or bear market mutual funds at the same levels. I’m thinking I’ll be at or near 50%+ YTD w/o buying options.

  78. Rob L.

    ken,

    what would you have done if the market kept going lower after the FOMC announcement with no turnaround?

    Not being a jerk here. Curious what your stop was.

  82. Natanarchist

    Gary

    So I followed you and everyone into the stock market trade yesterday.but only in the kids account. First non PM related trade in years. only committing 20% of available cash and so far its green..another good call.

    however, I am going to say you are correct on QE 3 being “officially” announced, if we even believe that QE (whatever they call it) ever stopped. With Zero, or negative rates built in for two years announced today, debt ceiling raised and will be raised again if need be…and now, today, the wife was checking the kids bank accounts….nothing but fee’s! We ended up closing a few accounts..however while talking with the manager, we asked if we had missed a notice about fee increases..he said yes and more on the way. Coupled with post a few days ago of BoNYMellon charging for deposits, seems they want you to either pay debt, spend, or speculate chasing returns. They are NOT going to pay you interest of significance. Can it be anymore official?

    So two calls right in 3 days..what have you done for me lately?…LOL..But I have been on the blog for about 4 years and I think 3 as a sub. I can only think of 2 times, PM related that could be considered “missed”. They were both buys and the early entry was corrected in 6 weeks maximum. and it was a drop of 100.00 maximum. With respect to May ’11 silver, You had already outlined a plan and strategy to be executed on the open of NY trading. While lots of us, you included “lost” some profit, the call was correct.

    Gold may still run its cycles, but we may see the smallest D wave of this bull. Its not 2006 or 2008. And it sure looks like no one is going to run to Dollars or US debt except the FED. Just a thought.

    The youth of the world are rioting. Sometimes for no reason. A life of no job and no freedom will do that to people.

    Its called a currency event. You really can’t fool all the people all the time.

    Anyway, whenever the next big pullback or d wave comes in gold, I am stocking more physical. its ugly out there.

    @ Alex in Montana..driving out to Banff next week with my two eldest boys. I estimate 40 driving hours..probably passing through Montana somewhere.

  83. sophia

    Sorry guys didn’t see the action yesterday US hours as friends around but…bought back more or less where I had been stopped the night before and want to thanks Gary for encouraging me to do so….

  84. Danno

    @ Catbird

    I suppose holding less of something would protect you (after a fashion) from the position moving against you, but whatever shares you still hold could be wiped out. My belief is that a person should hedge no matter how small his position is. Why lose any money?

  85. jeff

    The Fed did announce QE3 but instead of them buying treasuries they will have the public do it.

    That is, keeping short term rates at zero for the next two years, means that investors (especially large institutional investors who can borrow at close to funds rate) will borrow as much as they can and buy longer term bonds thereby netting the difference in yield. This will support demand for the long term bonds and drive down long bond yields. That is why yields sank today. And low long term yields will drive more and more investors into other asset classes to support stocks and commodities price appreciation.

  86. Danno

    It is ‘possible’ that instead of selling off… gold could churn sideways and correct over time. Just FYI. Not likely IMO but possible.

  89. Danno

    @ Wav_ridah

    The problem is the USA is a house built on sand. The sand is oil and global oil supply cannot keep pace with global oil demand. We have reached a turning point. GDP growth relies on higher and higher volumes of oil each year. It is not sustainable. The whole house of cards is about to come crashing down. There is no substitute for oil at this time and we have run out of time to find a substitute.

  92. Frank

    One thing that I don’t understand here is the sycophancy. If you “followed the trade” then you bought QQQ at the open on Monday and close on Tuesday. NQ is slightly down right now so overall the trade is break-even at best.

    If you do this kind of trading (or gambling) then you have to have good timing. Of course, I am not confident that the broad market is going to rally, so have a different perspective.

  93. Shalom Bernanke

    We’re due for a pullback, but I’m staying long with what I have as this is the best possible scenario for metals. I’m hoping to go Old Turkey and stay in my miners.

    The threat of QE3, or it’s actual launch which has been promised suggest gold has much further to go in the future. I’m willing to ride through declines and rather attempt to sidestep, I’ll rely on my strong hand status to buy into those declines. No way I’m giving up strong hand status. It makes it much easier to make the difficult decisions.

    I’m not saying gold won’t “crash” at some point, just that I’m not worried about it. Just another opportunity.

    Good luck today.

  95. Stoker

    Hi everyone,

    I have a question. I did not get my QLD position filled before the close yesterday, but got it filled pre-market for $74. I don’t know much about pre-market trading and want to know more – does anyone have a recommendation on where I can get pre-market charts and quotes? all I could find was Nasdaq.

    Cheers!

  97. Danno

    Shalom,

    If you don’t hedge your long positions only a matter of time before your ass is grass. 2008 killed a lot of bulls who could have made enormous fortunes had they been hedged even just 5%. At the bottom they would have had boat loads of money to buy to their hearts content.

  98. Blindweb

    In 2006 gold rallied 33% with no pullbacks in little over a month. Hasn’t Gary said at the end of a C Wave the average move is 25%, or something like that, with no pullbacks? I’m guessing he isn’t saying that now because it doesn’t fit his cycle counts. But like I’ve been saying since I came here, his cycles are going to fail when the size of the event is greater than the scope of the data backing his cycles. If you have a hundred year event you need many times more than a hundred years of data.

    IMO worst cases for gold are we consolidate or grind up slower than stock for a couple weeks, and then we blast off for another 250 point move. A major correction doesn’t make sense to me at this point.

    I already know younger people who aren’t wedded to the market who are pulling their retirements out of the stock market and going to bonds or gold. My guess at this point is the stock rally will be lower than expected

  99. Danno

    Blindweb,

    I think you make some valid points. However, gold can still EASILY pull back to it’s Bollinger Band midpoint or even 50 SMA and that would not be considered a sell off by any means. We have to make the distinction between ‘sell off’ and profit taking. Profit taking can happen at any moment right in the midst of a multi-month rally.

  101. Michael (Hulk)

    If you’re long equities for a bounce out of a panic low and assuming the bounce holds, then note that past such episodes have included significant “shaking of the tree” weakness and some ugly closes followed big up gaps the next day.

  103. ...at ease

    David and Courtney,
    If you placed a day trade and it didn’t get filled, you will have to place another trade for the next day (today). You won’t need to cancel the day trade order as it will cancel itself out. If you want to fill a trade that day or next day, have to place a trade for GTC (good til cancelled). So sounds like you will need to place another trade today either day or GTC. Right now, the stock looks lower than close of yesterday, so you may get in lower anyway at market price or limit.

  109. Blindweb

    Danno,

    Yes after posting that I was thinking that a daily cycle size correction wouldn’t bother me.

    Also if we get a surprise rally in the dollar from Europe collapsing again I think gold will withstand that much better than the stock market.

  110. Shalom Bernanke

    Haggerty,

    No, I haven’t bought the QQQ or any index. Focused on miners and PHYS, but also have not added any more PHYS lately.

    Danno,

    Don’t worry about me, my “ass won’t get grassed”, and I don’t have need to hedge. Thanks for your concern, though.

  111. St. Deluise

    well at this point anyone who bought the breakout yesterday is in the red. let’s see what the strong hands think.

    got last SSO buy order at 39.05

    need to see /ES close hourly below 1033 to worry me

  118. Rob L.

    Yesterday, DG was looking for a gap lower and was disappointed when there wasn’t – well, it’s here today. Is this a good sign?

  119. St. Deluise

    maybe, how many people actually bought monday or tuesday? seems to me that this is the call that people here are having an exceptionally tough time following.

    (boy this whole making money thing sure is hard isn’t it)

  120. Shalom Bernanke

    Hey Danno,

    If you’re always perfectly hedged, how do you ever make money. You keep paying double commissions, double spreads, and have twice as many moving parts that can fail, I’ll just focus on proper sizing, pal.

  121. Danno

    Shalom Bernanke,

    With 2x inverse ETFs you don’t need to keep buying puts every month. Anyway, I’m sure you already knew that because you are so very wise that you don’t hedge your positions! Man you are freaking crazy. The next 2008 is going to spank you hard and you won’t even see it coming.

  128. Ken

    I have no stops in and 100% committed long at this point and bleeding red right now on this mornings gap down. I have no stops in at this point as I don’t want to get whipsawed out. I guess I’ll start to get scared on a SPX cash close below 1100.

  129. Brian

    Ken, why don’t you place stops so your profits can’t turn to losses? I think you said you were +28%? The only thing worse than letting those profits evapourate is to let green turn red, no?

  130. Ken

    This is the first of many gut checks for new longs. Buy the dips and sell the rips works for those undercommitted at this point. By the end of the day I’d bet that this mornings open will be a gift. If the ES level just below 1100 holds this is just a bull flag formation and we’re just hours away from a massive short covering rally. The move up at yesterday’s close happened too quick for shorts to cover, let alone add more. Hopefully bears shorted this mornings hole and will quickly get burried in it. They’ll realize this when we break the 1180 level that held us in overnight and start to panic cover. This is nothing more than a bear trap, but who knows. Long and strong baby!

  131. LowTax

    The huge SOS and 10yr yield freaked me out yesterday before the close and I bailed on all my QLD. Then I fretted all night about selling. I used this morning’s gap to buy back half of my position. Will buy the rest on AN ACTUAL swing low!

  132. Dave

    Alright i have a major peeve i need some info about. EVERY TIME i place a fidelity order (market/day), it fills HIGHER than the prices i’m looking at either in the google finance feed or even the price listed in the order preview screen at fidelity. NEVER have i gotten the good end of a wiggle. for example, one of my orders last week placed way higher than i expected based on current prices – and if you go back and trace the price movement that day anywhere near that time it never got that high on the charts!

  136. Ken

    I’m not looking to make 10’s of thousands but rather 100’s of thousands if not millions. Markets like this only come around every so often so I’m going to make the most of it. By the time people realize what a gift they’ve been offered the opportunity will have passed them by. Right or wrong that’s how I’m playing it. I wish I would have been more greedy in November 2008 – March 2009 and looking back I was too afraid to get run over. I’m not going to let that happen again. These longs are just rentals anyway as I’m w/ Gary on getting back to or even making news 52 week highs by late September. I think we rally hard until the Q3 IRA/401k statements go out in the mail and then the lights go out on the market. I plan on being 100% short going into Novemeber for the slow bleed into Q4 2012 – Q1 2013. That’s how I see it.

  138. Billy

    I will be a buyer if the S&P can break over 1152 and hold. Otherwise I will wait and see what happens today, and probably make a small purchase near the end of the day if the weakness continues.

  139. Mean Guy

    They always bone on Market orders, same problem here,use limit orders. I also have Fidelity. Market orders basically they can but it when they get around to it.

  140. ...at ease

    Dave, make sure you refresh the bid price on the right side to make sure your price entered for a limit order is between the ask and bid price.
    I always go lower than the ask price depending on how it moves by nickels or dimes or quarters. Then wait for the next tick down. Or just wait for the dips in price and enter a market order.

  141. Hack

    All time high in GLD – problems in Europe. I guess we’re kidding ourselves thinking that Europe will solve all of their problems anytime soon… How can gold crash under these circumstances?

  144. Gann360

    yeah, it seems short term that 1140 ish on SPX (SP 500) Should hold, if it falls back into the down channel , that would be bearish

  146. dipshit

    This is going to be a long week.

    (Keep it to yourself, Ken. Can we give you the grief now? You don’t mind being the scapegoat do you?)

  147. Hack

    I was chastised yesterday by several folks on my stance on gold vs. QQQ but I doubt anyone here will say today, “maybe you were right Hack”…

  153. Frank

    I really like seeing that 1776 print for gold futures.

    Miners are doing pretty well today. At least the ones that I own. And Wheaton is coming back to green.

  160. Robert

    From Bill Downey–Gold Trends-like Gary offers excellent analysis

    We discussed last night when the (red circle) weaker trends do not kick in, the market has a potential of having dramatic moves up. That is the beauty of this cycle. WHEN ITS NOT WORKING — it is a “clue” that the market is very strong and the potential for dramatic moves to the upside are most likely during these times. Many people think that cycles are inconsistent but that is because they fail to realize a cycle inversion which produces the opposite effect is really the same cycle.

  169. St. Deluise

    gut wrenching indeed! you really gotta weight the potential upside with the downside though. still a good time to be long but i’m biased of course.

    people not willing to risk much could probably put their stop at the wick of this hour’s bar.

  173. Movax2

    Rob,

    Just looks good on the charts. MACD and other indicators look good, plus the rally yesterday should convince ppl to pile on if the low today holds.

  174. Ken

    Give it to me if you wish but I own 100% of the moves I make. I know the risks, assign probabilities, and measure the risk and reward. I see a lot more reward in buying equities at their yearly low than buying bonds or gold at their multi-decade highs. When people act like I’m crazy I know I’m on the right track. Common scence works folks. Has anyone ever heard of “buy low and sell high” or “be greedy when others are fearful” I think both apply right now. That’s all I’ll say as I don’t want others to blame me or Gary for how they manage their own capital. Good luck to all whether you’re long, short or just watching the show!

  176. Greenspansconscience

    This market is absolutley nuts.

    I am still long miners but very weary of what a correction in gold will do to them.

    I refuse to buy stocks based purely on technicals, and therefore will never buy a non PM related stock until the ponzi financial system is dead and buried. Call me pigheaded or ignorant or whatever, I just can’t do it.

    Long PZG, HL, EXK and AXU.

  178. 86d4life

    W2,
    Yeah right Pally! Doing taxs, gotta get this stuff to the cpa. One ass whoopin after another! LOL. I guess that`s what I get for a life of sin and crime(but I really like being a sinner).

  179. Shalom Bernanke

    Greenspanconscience,

    Same idea here, but not worried about miner positions. I’m more concerned about PHYS, but the miners have already taken their beating, IMO.

  186. Frank

    Shalom and his mentor Greenspan are wise.

    A nice trade would have been some puts on XLF yesterday. Reminds me of the good old days in 2008.

    Interesting that silver miners are following the market down.

  187. 86d4life

    Dollar homing in on the top of the bear flag channel on a daily. Everythings OK. we haven`t broken to new lows. Holding and gritting teeth.

  190. Slumdog

    RMB 6.4133 The highest ever.
    Moved from 6.44 last week’s high to 6.41, up .5% this week.

    Maybe they’ll get the message and take the hit on their past piling of paper, realizing that mercantilism is the wrong game?

  194. Frank

    It was some time ago and I was slow in hitting send. SIL was -2% at the time and also SLW, which is the only silver miner that I own.

    Weak g miners like JAG, GSS, and THM were all down too.

  196. Dan

    Jeff,

    Or we just keep falling into the close, as his been the case for the past couple days.

    Not happy with my positions at all. Markets just can’t get a footing no matter how wildly stretched they are. Feels like 2008 all over again.

  197. Duuuuuude

    SB, I understand that miners are tremendously undervalued against gold near term, but if indeed gold is hitting its D wave, I would think that would temper any gains on the miners somewhat…near term.

  200. Hack

    Mr. Shalom – you are correct about miners – I sold my SLW and EXK too soon. I need to adhere to Livermore’s rule – “ride your winners and cut your losers”. You are definitely our resident expert on miners…

  203. Gann360

    As long as that 1127 ish ( 61.8 fib Retrace ) Holds, Bulls have a Chance, Love to see them regain the MA;s and Pop back above the Channel.

    Call it around 1136 ish

  206. Shalom Bernanke

    Duuuude,

    I also would think if gold heads down it could hurt miners, but when I’m trading miners, that’s where I focus.

    Many things can happen, like oversold miners go sideways while gold corrects, or they even gain with the S&P while gold corrects. the point is we can’t know, so I almost treat my PHYS as a different trade than my miners even though they are related.

    Miners are piling up cash and will continue to do so even at much lower metals prices. Sure, traders that react to every little wiggle will dump when gold turns lower, but I don’t think those traders are focusing on the bigger picture.

    We’ll see how it plays out, but those are my thoughts.

  210. Shalom Bernanke

    Greenspanconscience,

    I do have physical, and fondle it often. lol!

    The PHYS is bought with funds I want to keep in brokerage accounts to take advantage of intermediate cycles, while the physical is being held for the entire secular bull. Never even thought of letting any go, but that’s not the case with PHYS up here.

  214. Shalom Bernanke

    One last thought on the topic. Those that want physical but have not yet bought or don’t want to withdraw funds from a brokerage acct might consider that miners are the next best option.

    They own the physical in the ground, so even if they don’t mine it profitably the properties can be sold. If this is the end game (not saying it is), there really is no good excuse not to have some exposure, IMO.

  215. St. Deluise

    this may not resolve itself at all today. what a mess.

    the lack of a gap fill is ominous but for as “bloody” as it seems out there we’re basically oscillating around yesterday’s vwap.

    got plenty of dry powder left but probably just going to live with what i’ve got until anything concrete happens.

  219. StupidMovingAverage50/200

    SM, thanks. What could be be safer than gold in the ground? Never thought of it that way.

    Ha! Ha! They are busy trying to dig it up. Green is busy trying to bury it again.

    Just leave it in the ground in the first place. The miners arn’t even bothering to dig it up anymore.

  222. Frank

    AUY is breaking out of its range. Its stagnation annoyed me and I sold much of it in Dec or January but still have a chunk. Not sure if it’s that 4.5 cent dividend, which is up 50% believe it or not. Kidding aside, the results last week were very good, but they came out just in time for the market plunge.

    Same thing happened to NGD. So it’s not surprising to see strength in these two now that the dust has settled. (Well not for the broad market.)

    BTW, GSS is up like 30% since yesterday’s sell off. I bought some at 1.85. Let’s see if it can push up toward 3.00 before the next correction.

    p.s. Where did they find Jamie Dimon? Put a white smock on him and you would find him down at the local butcher shop or fish monger. Hey, just like his buddy Mozillo.

  224. Greenspansconscience

    @StupidMA

    There is a bit of irony there, lol.

    Actually, thats why I prefer juniors or mid tiers with undeveloped properties. Why dig up and sell all of your silver and gold now when you can sell it later for a lot lot more?

  226. Marc

    Gary, If the newsletter and blog aren’t enjoyable for you, then I would quit too. Life’s too short and we will move on. Cheers!

  229. Greenspansconscience

    Frank,

    I am definitley familiar with AUY. Look at the size of the base it has. Once it busts through $14 for good, it will probably rocket. It’s been a POS for so long. Lol.

    It and ego have shown incredible relative strength.

  230. Hack

    Gary did say that gold would hit $1700 – $1800. Amazing… Now maybe ZeroHedge will be right about $2000 gold, and every one thought he was crazy…

  233. auger

    Hack, are talking about ZeroHedge, the blog? There’s probably dozens of people all posting under the same handle (Tyler Durden).

  237. Gary

    Actually it’s not unusual for major intermediate bottoms to whipsaw back and forth for a couple of days as bulls and bear fight it out.

    It is the 38 day of the daily cycle after all. And we will almost certainly see a positive divergence on the NYMO if the market can make a marginal new low. That also happens quite often at intermediate lows.

    Gold on the other hand just keeps stretching further and further above the mean guaranteeing a bigger and bigger crash when the trade stops.

  242. Frank

    The conspiracy crowd led by Sinclair were going on about 1764 or 1770 (or 1776???). Anyway, if it can break from there then it’s off to the races. We’ll see….

    Ah, the “cartel” pulled it back. Tsk, tsk.

  244. marksomething

    sb

    “There are now lots of trapped longs in the S&P, Nasdaq, etc. that will be looking to sell into rallies hoping to break even. This could keep a lid on stocks.”

    You are correct sir! IMHO

  247. Poly

    Gold @ $1,800 is a nice big number, for a DC top, at least.

    Right now they are simply just fear trade correlated, once that trade reverses, equities will stamp out that IT bottom (they are fighting a massive trench battle here) and gold will VERY quickly find at least a DCL within a few days.

    One thing I’m NOT banking on is Gold moving towards a IT low.

  260. Visitor

    Still looks like a lot of group think here. I guess you can call for a Gold correction or D wave all the way up as gold hits 1800 and above and eventually you’ll be right. What happened to “Old Turkey” or whatever you used to say here?? – – As far as I can tell, you pulled out just when the run was heating up and put it on a loser. The funny thing is almost everyone here keeps believing and patting themselves on the back like everything will be OK.

  262. corporatewarrior

    To the more experienced investors:

    Will a ban on short selling affect Inverse ETFs? I’ve scoured numerous blogs and websites and the answers seem pretty ambiguous. Just looking into options for long term over the next couple of years. Any other ideas for buy and hold? I had TZA and FAZ in mind for this avenue.

  269. Keys

    Vistor,

    I appreciate your post…you are right about missing the last bit. However it depends on what your objectives are.

    The only thing I will say about old turkey, is that there are two types…old turkey and modified old turkey..

    The problem with old turkey is that it is true that the bull will rescue your position, however the risk is getting stuck in a severe drawdown and at that moment something changes and the bull dies…these are forever losses!

    The longer this bull stretches, the more likely the final end comes. We hit $2500, and this is going to look like a final pop. Many of us, or none of us, or maybe just me, do not like being involved in parabolic moves for such a reason…the longer gold goes up, the older that old turkey gets, and dies. If this is what C-Wave top is, and understanding parabolic moves, I get why Gary wants to get the heck out of the way…and I believe despite what he does, that he would have been irresponsible at a certain point to say exit.

    You sell parabolic moves, you don’t buy…You might be early, but you won’t be late.

  270. Keys

    that he would have been irresponsible at a certain point to say exit.

    Shit….meant to say

    that he would have been irresponsible at a certain point to NOT say exit.

  271. aljiowa

    Visitor, if you oppose then propose. Propose some good knowledge or thoughts, don’t just nag on people for taking profits after a good run. What value does that add to our blog?

  275. marksomething

    For the Newbies and those that b*tch and moan,

    “Experience is something you don’t get until just after you need it.” S. Wright

    Im out, gotta go to my other job now.

  290. 86d4life

    Poor little Toby,
    sitting there spitting and licking, trying to get the visitor out of his mouth. Like when they`re trying to spit out feathers.

  291. Adam

    Visitor is right. Gold will never correct… ever. What should we do right now – as in today? Apparently you have the answer.

    I’m listening.

  292. Visitor

    I can understand why everyone is sensitive here. I have what has been coined here as “strong hand status”, so I’m not really freaking out if this is a gold top or not. FWIW, I don’t think we’re at the ultimate top, so I don’t really care. I’ll sell when I think real corrective steps have been taken regarding the economy, like when my neighbor who stopped paying mortgage long ago is kicked out or resumes paying, when banks start writing down losses and begin loaning again . . . when we have a flush of Washington, etc.

    What I wouldn’t do is continue to try and trade what is (still) a bullish sector. Of course, if you did that, you’d have to stop posting multiple times a day and go out and enjoy life while you can.

  295. StupidMovingAverage50/200

    This is the European version of TARP underway. U.S. dollar is supposed to be the weakest currency until the zero-interest-until-2013 gets priced in even against the EURO. EURO still has German Marc backed into it.

    MM, please give me a link to SOS list or some sort of explanation of where I can find it.

    “SOS is led by GLD …”

  296. Power Corrupts

    Bob Farrell, one of the greats in market analysis, observed that market corrections are when the old market leaders are replaced by new ones. If that’s the case, the action of the mining stocks over the last several trading days is very encouraging for bulls on the group…

  298. n1tro

    stop hoping and dreaming about a gold decline. if one keeps saying it’ll happen, sure it’ll happen evenually but those who sold as per the portfolio change instead of rasing your stops are out 200 points now. physical stackers must be having a good laugh now.

  299. William Wallace

    Gold is like 86 when he is drunk…you punch him in the face…he hits the floor…gets back up slowly and stumbling and gets even boulder…you do it all over again until he is so beat up he finally cant get up for a while

  300. 86d4life

    Adam,
    gold will never correct? Really. I don`t know what`s going to happen 5 minutes from now. Maybe you can share with us your Guaranteed visions of the future.

  303. Keys

    What I don’t like about stops, during parabolic moves…is that it is the same old story, of everyone thinking they can get out all at once…pre-market we have been up 60-80…this is not healthy…if a pre-market move hits gold we could be down 100-150 overnight…now this is just a chance, but since these levels will be revisited at some point, since we have gone parabolic, I view the more patient thing to do is to exit, or buy puts, or something and wait….I know my puts have been blown out on my physcial; although I don’t participate 100%, I did get 50% of the move up with a big surprise…moved those puts up, and now I wait further..

    One note, I hedge out my physical silver, and right towards the end it became more difficult to hedge due to price of puts…I am noticing the same problem in the gld now…just a note don’t mean anything from it.

    BTW I think I know who Vistor is, miss you on the blog…N1TRO good to see you too

  307. oa92000

    Treasury sold $24 billion in fresh 10-year debt today at a rate of 2.14%, lower than the 2.18% the market expected.

    S& P is just a fool..

  308. Avann

    Let’s all just capitulate and buy back in … that will surely get the correction started.
    FWIW … I bought back in … 10%.
    Frankly that’s one thing that I found a bit surprising in the last few months … no core position.
    I still have a little bit of physical but not near enough to consider it a core position.
    Well … let the fun begin … I’ll set a stop around 1650 … I think that may be considered the last DCL?

  309. n1tro

    Keys or anyone who knows,

    Has gold ever opened $100 lower in a day even in a D wave? Can’t ever recall. But my point is that even if it does, having clear stops from a starting point of $1478 (when Gary called the bottom), everyone would be in the green. I learnt my mistake of getting scared out when Gary got his gitters. Next time, I’m just raising stops. Whats that old say? “The bull will do everything to knock you off” I think most of us are all knocked off and sitting and watching gold run away.

  315. Adam

    86,

    You obviously have a firm handle on the use of sarcasm. I actually had typed in “sarcasm” before and after that statement in HTML, but unfortunately it was not included after pressing “Publish Your Comment”.

  316. Keys

    It depends on what your objetive is …I have never seen gold gap up 60-80 before either…so tit for tat…I don’t trust parabolic moves ever…learned that the hard way…I keep that rule simple…no matter what, I always sell into parabolic moves…and yes I was early…but I have seen guys get blown out on these things…they never recover…

    If you are true to old turkey…great, as long as you can hold…I am not trying to say people are wrong for it..I have not experienced a D-wave with Gary, but I have exprienced parabolic collapses…I think they are the same thing…I run and hide when I see these things..

    But to each their own! Really depends on risk tolerance. For me I need to manage a very small family trust, I need to think beyond today and well into the future…I am a big gold bull, but parabolic anything tells me to be careful.

  318. Dan

    TZ,

    You out there? Seems you got it right again with your gold futures for the past few weeks. How are you viewing all this now?

  319. Adam

    Visitor,

    That’s fine if you have strong hand status. You’re probably right about most people over-trading. I was simply pointing out that GLD is currently exceeding a 3 std deviation from its 50 DMA. At some point you will need to sell your position if you plan on making those paper gains real gains. I’d rather sell when it’s stretched personally. It’s not a recommendation to do anything – just an observation I thought I’d share. Apparently, the observation was not welcome. My mistake.

  320. n1tro

    WW,

    So what if gold dropped $60 yesterday? Unless you got in really, really late, it wouldn’t affect you. I believe Gary got most out at around $1530-$1560 (correct me if I am wrong). So assuming you went in at $1478, your profit stop could have been $1500 when the model portfolio was sold off. No point calling this a parabolic move after most of us are already out and too scared to get back in. I can only remember Poly and one other user having a contrary opinion at the time Gary got out so congrats if they are still in. I’m holding on to my small physical position.

  321. Gold Lion

    Mining stocks on the move, QQQ’s not so much. Maybe the smart money realizes real value. Instead of fearing getting caught in a D wave, maybe buying weakness in the jr. miners makes sense. The coralation isn’t 1:1 obviously.

  322. auger

    In my opinion, “strong hand status” implies you can weather any kind of drawdown/correction, in Gold. It’s not just simply being confident, in your position. Didn’t Gary write a post about this once? 🙂

  323. William Wallace

    N1tro,

    You said what are the chances of gold dropping $100 overnight…my point in saying gold dropped $60 in minutes makes the chances of gold dropping $100 overnight a good chance…this is a parabolic move, when the panic selling begins a 4100 drop will be nothing within a half hour.

  325. n1tro

    the only parabolic collapse I’ve witness was silver last may. That took 4 days and I was heavily leveraged and didn’t feel the effects until after a full day of declines. Remember if you got in when Gary called the last cycle, you would have a HUGE cushion if gold did drop $100 or more over night. My personal belief which I know Gary doesnt share is that silver only collasped because of the 9 rate hikes in 5 days from the comex. If we didn’t have that event, we would have all gotten out profitable with raised stops.

  328. William Wallace

    N1tro,

    What the hell do you mean Poly and one other person on this blog were calling for gold to be at these levels…everyone here knew it..gary has been saying it forever..he expects $10,000 gold, but that doesnt mean its ok to get caught in a crash…gold will correct and it will be as if we were never here with alot less risk to buy back in.

  329. n1tro

    Poly did not agree with Gary and reason for getting out of gold. He said there were more factors at play than miners diverging.

  330. Hack

    Building a big cap portfolio, flight to quality. Just added XOM. Already have AAPL, DECK, SLW and MCD. So that covers energy, consumer cyclical, materials and service sectors. Stalking VZ….

  340. n1tro

    WW,

    Let me summarize what lessons should have been learnt from silver fiasco to now and for the future.

    lesson 1.
    parabolic silver and then crash where most lost their shirts. Have a fricking stop!

    lesson 2.
    parabolic gold and up coming crash, raise your fricking stops!

  347. Gary

    I’m tired of holding everyone’s hand. I’ll put my thoughts in the nightly newsletter but I’m not going to spend much time on the blog anymore and I’m done trying to answer 50 emails a day.

  352. William Wallace

    Gary,

    There are many here, more than a few that look up to you and depend on you, all your help was invaluable…sad to hear you will not answer our questions anymore on the blog, but you must do what is good for you.

  362. Mean Guy

    Auger

    That’s alright was just looking to add to position that looked as good a time as any. Only 30% invested,my theory is if that 30 goes to ZERO think what a nice bunker I could buy with the rest.

  365. William Wallace

    Miyagi,

    Hello senseisan…you know its not like we havent had C-waves before..maybe not this extended, but even those came to an end. Most people think the world is in such shambles that gold will never correct, but the fact is smart money takes profits..period. Gold will correct and we will buy again.

  367. MrMiyagi

    WW,
    What goes up, always comes down. Then back up. Unless it’s Nortel or Enron..

    Three days ago, I whacked my finger with the hammer, must’ve confused what nail to hit.
    F me it was painful.. I can’t even begin to imagine what you might have gone through when you had your accident.

  368. auger

    haha, Mean Guy, fair enough. Gary’s got your back, if you’re a subscriber. It’s a shame that some people complain.

  369. Poly

    With regards to parabolic runs, yes they sure should be avoided once well under way. But everybody is waiting to say I told you gold is going to collapse, like it’s some big mystery. Been hearing it for $150 too.

    But in context with the discussion above, if you were invested well before it went parabolic, have strong hand status and “firm belief” in the trade, I see absolutely no point in exiting the trade until the very end. Even getting caught overnight, say in a $80 drop, it would only wipe out the last 2 days of gains only.
    The absolute key is to have and honor a good stop and if it is jumped in the overnight trade, simply exit and bank the difference.

  370. ...at ease

    Razvan,
    W2, 86 and myself have been out playing all day, Who was bellyaching?
    And who the heck is sending all those emails?

    MrMyagi, funny, I was thinking the same thing, he wasn’t getting his due time.

  371. aljiowa

    Tired of holding everyone’s hand? Who is everyone? The few people that complain? I understand not answering 50 emails a day…I do that as part of my job and it’s not fun. I thought this blog was for discussion and education…not for hand holding, complaining, feelings getting hurt, etc. Are we not adults?

  372. Avann

    I assume all the bellyaching is coming through emails.
    He should just have an auto-response telling folks to ask it on the blog.

  373. Mean Guy

    Everyone is going to die with a shit load in the bank because of not one of us is that stupid. The only thing is “HOW MUCH”. I’m 52 don’t work this what I do all day. 50% of the people in the work each day to get enough to make it to the next God Damn day. We do this all day and guys are bitching about this last 10 % on the move in GLD. The MKT could drop 300 S&P handles and I’m still doing better 99% of all the people on the planet. Gary hang in there because need the advice and I’m slow.

  374. William Wallace

    Miyagi,

    Yeah I have been through hell, I have nine lives…you can rip my brain out and I will still be running around. In my accident I broke my back, pelvis, and shoulder all torn ligaments, collar bone had to be cut in half…I was racing around the hospital in a wheelchair with 4 friends all in wheelchairs and realized my shoulder was feeling weird so they took xrays and found my collar bone was disconnected at two points (chest and shoulder, I told the nurse how could you not notice this..what else the hell did you guys miss wrong with me? She said I guess we will see and took more xrays and my back was broke too! I said what the hell is going on in this hospital, fly to a better place before I go home all crooked and lopsided!

    I whack my finger regularly with the hammer, did it recently bad. Stinks dont it?

  383. Bob loves Hawaii

    If you are going to play in these volatile markets, you need to learn to scale out, and / or sell calls into your positions.

    That way you can sleep at night, and get out on the break.

    That is what I have been doing, and wull close off on the break down. That way you should not care, and oh you would be $200 of Gold wealthier.

  385. 86d4life

    Mr M,
    back in the day, I tried to get Superman(coughW2cough)upon the roof with me, where it was safe and he could finally be productive for a change,but nooooooooooooo. He`s out running around on his motorcycle, doin all kinds of gangsta shit……

  388. Keys

    I think I am going to stop posting for a bit…too much “see I was right” and “We will see who has the last laugh”….

    Each parabolic rise is different I will say…and each day everyone has a choice to go in or get out…so I don’t understand strong hand status, weak-hand…Get in if you still think it is good or get out…but either way too much rubbing fur the wrong way while patting yourself on the back stuff nonsense. Not everyone!

    Damned if you do, damned if you don’t…

    Good luck all!

  396. Razvan

    Pretcher said we are in a bear market until 2016. He said we are entering the 3rd leg down of the Elliot Wave which is the most powerful but he stayed away from giving a target. He also said he is not interested in gold here. Nobody wanted it at $250 now everybody wants it at $1800.

  398. Poly

    I read Pretcher in 1987, he was calling for a major deflationary depression like bear market then too. He has been calling it ever since.

  399. Greenspansconscience

    Playing the miners can really mess with one’s head. They clearly do the best (outperform) when everything
    is up (stock market and metals).

    The divergence we saw was more a result of the insane rally off the lows in the HUI (from 490 to 580 in about 1 month) and then the broader market crashing, IMO.

  401. Hack

    Won’t be long until folks give up on the market. Problem is Bernanke put the interest rate at 0.1% so no one can save money the old fashioned way. So gold is the only alternative, rubber band theory or not.

  403. Visitor

    Here’s the thing I don’t understand from a “Visitors” standpoint. If the majority here believe gold will correct and you will buy back in, it seems like you should have some number in mind (a target) of when you will buy back in. I don’t see that from anyone here. Why?

    Also, someone mentioned 1530-1560 was the “out” call from Gary – I don’t know as I don’t follow the blog closely and don’t subscribe, so don’t beat me up if I’m not exact. (And I’m not beating up on Gary as he seems to do his best to make good calls.) So, even if that’s close, it would seem you have to wait for a correction quite a bit lower to have made the trade out and back in again worth the risk and cost. And you also have to hope and/or assume that your new opportunity buying QQQ or whatever you’re buying is profitable.

    My point really is just that I think people get caught up in the action, the internet, blogs, etc… and make huge mistakes by over trading, over thinking and not believing in their convictions. That’s all. Not meaning to stir things up, just would like to see more people think and let greed motivate their actions.

    If I were in the position most seem to be in here, (out of gold and waiting to get back in) I would figure out where to buy in (assuming you believe gold will go up and that’s what you want to do), take the action a stick with it this time. Let the winners ride.

  409. 86d4life

    Visitor,
    But your calling the plays in the rear view mirror. Why weren`t you here, busting a move and making the call when Gary said bail? that was 1630 for me btw. So why don`t you start your own newsletter. what is the point of coming here and Monday morning QB? Not being sarcastic.

  412. Hack

    Could be right. Obama gets Geithner to call his friends at GS to dump shares, then Obama gets his crises, QE3 and spends us into oblivion.

  413. Mean Guy

    Financials got taken to the office today. 10-11% I have to believe there phone calls being made to anyone that’ll listen. What’s the catalyst to push higher other than suppose to happen, any thoughts. As far as VISITOR go buy some GLD, make a lot $ retire.

  414. Hack

    The smart thing to do here is to sell QQQ on any strength, hibernate and let this blow over. Gary always says to preserve capital in order to buy gold cheaper. One thing I do know, gold is making me a lot of money and QQQ is not.

  418. StupidMovingAverage50/200

    Visitor, candlesticks. Cycle low needs to break the cycle trendline. The move up out of the low needs to break the downtrend line from the cycle low. That’s when you buy. When it happends on the weekly chart that is the intermediate trend, and that’s where you want you trand. pimaCanyon is the explanation guy.

  420. Visitor

    To those that commented. I had subscribed to Gary several years back and it was helpful. When he abandoned what I though was a sensible approach I decided not to continue. Not saying he is wrong, just not right for me. I have my own opinions and check in on other sources of information, so I don’t feel I need to pay for a service at this time. I don’t consider my comments “rear view” because I’ve held them for a long time. I don’t trade full time or even part time, so I’m not on boards commenting as a lot of people do. If you take this day and look forward, my comments certainly can’t be considered “rear view”. Somebody asked what I’d do now and so I responded. It sounds like you have your buy target, so hopefully that will work out well for you. I’m not an all in or all out kind of investor. Not saying it’s wrong, just not right for me. For example if you had held 10-20% of your GLD or whatever was working, you’d at least be staving off some of the hurt. By going all in or all out, you are in some ways trying to hit a home run. Even Gary says he can’t do that.

  421. Frank

    Check out JAG’s report and after hours.

    Finally, some luck with the “value” miners. GSS is up nearly 40% since the low yesterday.

  422. Michael (Hulk)

    From the volumes on the major stocks there is undeniably something brewing in the miners.

    I like to “trade em up” and not get batty with fundamentals but I see drivers beyond high gold price and low oil price pushing the sector that can create a virtuous cycle. It’s gold companies’ resources that were not commercial now becoming commercial at this current price, it’s financing for projects which was not available previously now being thrown at them etc.

    The risk is getting caught in a D-wave as Big G says. The upside is getting into a highly marketable story which could ignite like the internet days a decade ago. The solution is correct stress-free position sizing as Mr SB says that allow you to stay in.

  423. MrMiyagi

    Someone is selling LOTS of QQQ; over 3 million shares at 53.0438$ so far. Aside from these huge blocks, it’s been averaging around 51.40$.
    Same with SPY, big lots of half a million here and there at 117.4901$ otherwise averaging 113.10$-ish.

    Not good, not good at all.

  425. MrMiyagi

    There are HUGE blocks of 5 million shares apiece of SPY that went out in the last 5 minutes at 112.3142$.
    Someone (Obama) is dying to get out.

    I fear tomorrow will be redrum.

  437. KAL

    Probably I should know this, but who’s buying those shares of QQQ, and why isn’t the price being affected by the sales? If it’s liquidation, is it the PPT buying them? Price is holding up fine.

  438. Hack

    …at ease…I was a subscriber until last night. To me buying an index fund is not a value added service. Analyzing and picking an individual stock that beats the market is what I would pay for.

  439. Visitor

    Clearly, several individual miners are breaking out and I don’t think they will stop for awhile. Not straight up, I’d buy dips. Even if gold corrects, they still have good margins. Producers are making good cash flow. NXG, EGO, MFN not necessarily in that order. I like PZG too, but that is a wild horse so I’d be careful.

  440. Visitor

    Frank – Respectfully, I’d be very careful with GSS. Not all miners and juniors for that matter created equal. Lots of issues with that company and region of the world. Better plays out there IMO

  442. Frank

    GSS is piece of work, but I think we saw capitulation the other day. I have been watching it for 18 months.

    I don’t put big money into these “value” plays. I am only at break even with JAG.

    Maybe I get involved with these guys for extra excitement. But it sure beats messing around with QQQ. Oops, sorry.

    One interesting thing is that these companies that suffer from poor management are HQed in the US whereas the strong miners that I own are all Canadian owned.

  443. Moneyman

    Seems that we got a parabolic move in gold without the dollar moving lower to a three year cycle low.

    We might see the dollar moving lower soon and gold can feel the smell of it….Who knows..????

    With sentiment very high and miners and silver diverging gold is acting very powerful..

    The sad thing is that Gary predict this..First 1650 in gold..And later numbers around 1800-1900..He saw this coming..

    I think we will get one more chance later on..QE3 will come..

    We might see the three year cycle low in the dollar in oktober-november..

    So the case is..I hope we will soon see a correction in gold to 1650..I will buy there..But the correction must come soon and be big..And I think it will come..

    Sold my position yesterday as I wrote..

    Take Care!

  444. Frank

    BTW, re NXG I am happy about the merger because it elevated the share price, but I don’t like it long term. I am reducing at 3.50.

  445. 86d4life

    At Ease,
    looks like it`s moving into the dollar too. Not really digging the feel of this. Maybe I`m wrong, but it feels as though we are at a turning point. What defines when we actually arrive at phase 3 of the bull?

  446. Frank

    Forget about the dollar. The dollar index is useless because it is measured by over 50% with another toilet paper currency.

    Instead look at it versuses the CHF or JPY, especially the former because its central bank is impotent in terms of holding the currency back.

  448. Danno

    Shalom Bernanke,

    Miners could just as easily get Rick Rolled. Bad advice. Any selling in gold could cause a panic exit as long lock in profits. Now if you went long miners and HEDGED you would be fine. But of course you are too smart to do something like that! ROFL.

  449. Greenspansconscience

    I will say this about not following Gary’s calls-i almost always end up losing some or most of my gains. That being said I am still long miners, so my guess is I’m in for even more of a beating. :p

    Also, his bottom calling skills for gold futures are second to none (which makes one wonder why he even messes around with stocks or even etfs). That alone is worth the price of a subscription. If you are old turkey, thats all the info you need to know. Just go long and forget about it. He had us long at gold 1310 or so. Could you imagine going full margin and just rolling the contract forward until this gold bull finally tops and never trading a single wiggle or cycle again?

    I think the crazy miners spooked Gary. That coupled with the silver top miss have him overly cautious imo. Plus, I thought we always keep a core position, even through intermediate cycle lows?

  452. Salty

    Its hard leaving a great party while everyone else is staying late and having fun . But do you really want to be there when the cops arrive to bust it up? There will always be another party, but not if you got your head bashed in.

  453. LuckyGuess

    A horse walks into a bar. The bartender says, “Why the long face?”. Horse says “I sold my gold too early”.
    …..
    So now you know the funny part.

  455. Avann

    I left the party long ago and am jealously lurking in the neighborhood. I think I’ll call the cops … They’re having way too much fun without me.

  456. Gold Lion

    IMO I think trading in and out of miners is what gets people nervous. I have been long miners in three portfolios since Q3 2008 and have just had the worst draw down since buying them. It was 23.36% top to bottom. Now, if I have been trading in and out and my frame of reference was my last buy-in, I don’t think I could of heald through it. I have felt all along that I might need to stomack up to a 35% draw down. As of today I am 16.83% off the highest point…and moving up I fricken hope..lol

  457. Poly

    Get over it already, if you were not in it, you missed it too. There are plenty of other opportunities right around the corner.

    If you’re looking for a $200 subscription to make you rich, you will never make it or find it. A subscription is just one small part of your overall education and research.

  459. LuckyGuess

    Episode 2:
    A horse walks into a bar. The bartender says, “Why the long face?”. Horse says “I sold my gold too early”.
    Bartender says “Yeah, but at least you sold it dumb-ass”.
    …..Horse feels better, and feeling less pain, buys another round for the patrons.

  460. ...at ease

    DG, have a question, I just read this on an advertisement, did you write it? 🙂

    “I am a four month old subscriber, after 30 days I am thinking like Buffett. You take 4 credit cards at 0% for 18 months, max them out with 1/2 silver and 1/2 gold bullion sent to your house, then make min. monthly payments and you have a 18 month metal backed savings account. You guys opened my mind and I am cutting my own path.” – Paid-up subscriber DG

  461. rose

    Dear Frank,

    re GSS – I do believe I saw it on today’s selling on strength list – don’t know how to interpret that 🙂

    re JAG – my position is still under water 🙂

    With very kindest regards,

    Rose

  462. bamster

    Poly,

    I have read some of your calls and respect your knowledge with regards to trading. congrats on your latest trades. You stuck with the gold trade (along with TZ and a couple of others), and you weren’t afraid to post your trades to back it up. Please keep posting your thoughts especially when a call to change strategy is made. I feel it is healthy to have different points of view debated on this forum.

  465. bamster

    It means you have to put up more money if you are holding a Gold futures contract on the Comex. I believe it will now be $5500 per contract for existing positions.

  466. St. Deluise

    whelp, sold my SSO at the close at a loss. effective volume in /es broke yesterday’s low near the EOD so looks like a lower low is in order..

    think we see /es 1055 tomorrow & will give it another shot there.

    this is a weak-ass market yo

  468. gold silver troll

    This is a great lesson for all of us…

    Gold can and will go parabolic and the dollar could mean zip because this is the greatest bull EVER.

    At the next intermediate cycle or d-wave, we should all know what to do.

    LOCK AND LOAD for the next how many years.

  474. Dan

    Wow! Investor Intelligence just released their weekly update and there are MORE BULLS and LESS BEARS than last week!!! LOL The media has clearly done a great job convincing everyone this is nothing more than a dip and buying opportunity. Fear is clearly not here yet guys!

  477. catbird

    Well congratulations to all the whining little babies who have pushed Gary off the blog’s comments section. That’s some doing…the man has the patience of a saint.

    At least you haven’t driven him to give up the nightly reports yet.

  478. hamvestor

    catbird, I’m not sure the problem was “whining babies” so much as trolls whose agenda was to harass Gary and to disrupt the blog. I’m continually amazed at how many on the blog have been gullible enough to take them at face value and engage with them as if to conduct a serious dialogue, which is a pointless exercise imho. It’s a shame that these folks with malevolent intentions have had such success with what should be their patently transparent agendas.

  482. catbird

    hamvestor,

    There are trolls, no doubt. But some of these people I think actual meant to piss and moan because Gary fell short of perfection somehow.

    They lost money, they’re in pain, they’re not mature enough to take responsibility for the orders they themselves type into their computers, so they lash out at Gary.

    Also don’t forget that Gary apparently has some high maintenance subscribers who have been bombing his email wanting hand holding.

    America is one seriously dumbed-down country. The people who have come across Gary Savage’s writings are probably smarter than the average American–and yet this is how THEY act. People are idiots.

  485. Phil

    Catbird,

    Well said. We are a “society” full of instant gratification wannabes that don’t want to lift a finger to do any thinking for ourselves. Really scary part is that now our children have picked up on this sense of entitlement/apathy! I’m hopeful that this “reset” that is coming in 2012 will be enough to “shock” the system so our kids have at least some hope!!!! Sorry for the semi-rant but the cold hard facts are that the root of the problems are apathy and entitlements!!!

  488. Phil

    BINGO Eamon!!!

    Kind of like why would I go to school for 8 years and become a doctor to actually contribute to society’s well being? When instead I can get a four year accounting degree, go to “work” for goldman or JPM or whatever bank and make more money by not being required to pay for malpractice insurance for fear of getting sued! And don’t even get me started on the most important jobs of all and associated horrible salaries/treatment……School teachers…

  490. Rob L.

    Gary,

    We all know you’re lurking in here…waiting to see any comment from your arch rival “beanie”. 🙂

    Dow to 30,000 and beyond!

  492. RJ

    Check out this weekly annotated chart for gold.

    Back in the end of 2007, there was a parabolic looking run, then there was a sizable correction, then the real parabolic run up to march 2008.

    Poly,

    A repeat of this may be in line with your thinking of a regular DCL (or two) then the big leg up.

    Notice how the final parabolic run in 2008 had a number of red weeks on the way up. What a way to shake everyone off. This past run has been straight up without a down week. I have to do more checking, but how many final C wave tops were straight up on a weekly without pullback?

  493. SF Giants Fan

    Wow gold is red (a few bucks). Maybe it can gather some steam overnight. My guess it will be a Sunday afternoon surprise like silver. Small positions in DZZ are getting heavy but no way Im selling. ZSL still profitable. Will add on the swing high.

  495. marksomething

    “Avann said…

    Sad part is both Doc and Gary missed this last $200.
    August 10, 2011 3:48 PM”

    Gary didn’t miss anything! he took profits and ensured that those who would listen took profits as well. He also said that because of May (silver) he would get out early. It is comments like that Avann that seem to be wearing down Gary.

    I do not appreciate it and would politely ask you to cease and desist.

    now, on another note brought to you by Steven wright (he is killing me today, love his stuff)

    ~ The early bird gets the worm, but the second mouse gets the cheese. ~

  499. Keys

    My last post, as posted on the SMTP blog….well until morons exit!

    Look I am up but this will most be my last comment until the BS(bullshit for the pc followers) ends…
    I am tired of this grade school crap…look…we all lose our tempers! I know this, because I am a complete asshole when I lose control! Fact and submitted!
    But day in day out, just makes one a punk…I did learn alot from the blog..but the ongoing retarded comments are making it hard to live here….complete utter idiots that pretend to think this and that, but have never endured through a parabolic event. I will give a freebie to you novice investors…..1) always sell into a parabolic rise…that’s it that’s all……for the mom’s and dad’s fighting to make ends meet, that lesson is for you. Learn it the easy way or you will be ass rapped by the market…sorry for the crude meaning, but the market will do that to you….I am tired of good families and people trying to put their children through school, being screwed up by the propagated BS that the gov is giving……That being said, and as a parent, your safest bet is cash, until this parabolic rise is down, then we re-look!
    Inflation is about 7% a year…and no I am not going to give my data on this blog…families already know this fact….and to those that are trying to give their kids something, stop, cash for now, and wait…opportunities will come! Most people that follow a parabolic rise will lose a ton…I am not concerned with Joe gambler, I am concerned with Mike and Cindy novice investor…

    Just to be clear…..get the F***k out, and stay in CASH until things blow over….clear enough for Mike and Cindy…don’t ask further, this is the right thing to do…otherwise, in a couple months or less, we will be talking about the morons that tried to print. Either way Mike and Cindy get the F%%k out and wait…7% inflation will not nail you within 2 months…and gold is no place you want to be…
    Alright my peace is made…….when all this shit is over. Please apologize to Gary for being such retrards…I have never seen so many idiots in my life….but many of you owe Gary a huge apology. But only regarded when time tells I guess!

  501. james r

    I believe it was Ira Epstein who mentioned on his youtube video that the DOW road the bollinger band for seven days in a row.

    This has never happened.

  504. aklaunch

    In the ego driven world of about every difficult task at hand there will always be severe criticism. This stock market game can be boiled down to fear and greed and will never change. Each human will react to one of these emotions depending on which side of a trade he is on. That being said negative comments will follow and will never change either way. I believe that good old fashion competition is what keeps us sharp and evolving. With out that lies apathy and complacency.

    The good ole boys used to trade for 5 years minimum. Those days are obviously over as one can buy and sell on a whim with an iphone app, PC or trading platform. (international trading expanding as well)

    Seems Gary is on a crusade to make the model portfolio a safe haven that will take the best odds and play them, coupled with an aggressive portfolio that as mentioned 10 times before can break you if you are needing to be educated more in the ways of the force.

    I love the blog and have learned more about human emotion than i ever thought possible here. It is impossible for 400 people to be on the same page and i understand that.

    The thing we can all learn is to keep criticism at a minimum and education at a maximum. Learning from our mistakes makes us powerful. Blame shifting and pointing fingers is a cowards game that never ends.

  506. Beanie

    We successfully retested the low from Tuesday….in a very oversold environment. Tomorrow should be quite a face ripping rally.

  510. aklaunch

    Instant gratification just leads to poor expectations and misery. The spiders that wait in the corner always win against there opponent.

  511. Rishi

    What percentage did we extend above the 200MA in gold at the market price of 1815? also, what is the max that it has ever extended?

  512. Danno

    Keys,

    You don’t have to sell into the early stages of a parabolic rise as no one knows how high it might go and it would be very STUPID to miss out on the lion’s share of gains. Instead of selling you can simply ladder in a hedge on the way up (buy shares in an inverse x2 ETF and/or buy some puts). Then your profits are protected from a violent sell off but you still keep the ability to ride the parabola higher. Once the curve reaches nose bleed territory of course you want to sell your longs and take profits. But if this is truly a big time parabolic move then we may still be in the early stages and there is no need to run and hide under the blankets. Just hedge the crap out of your long position and you should be FINE. Hedging is what the pros do.

    I’ll give you an example. The other day I bought 100 shares of AGQ at $200 for $20,000 total. At the same time I bought 100 shares of the inverse ETF (ZSL) at $12 for $1,200. Worst case scenario if silver crashes and burns like 2008, ZSL will skyrocket. And for protection against a milder pullback I also bought about $700 worth of SLV puts that don’t expire for two months. So I paid about $2,000 in downside protection on a $20,000 investment that I hope will double in value sooner or later. The shares of ZSL I can keep indefinitely. The puts I may need to roll into the next month as time passes which will cost me a little more money, but it will be money well spent. And I am ready to sell a covered call on my 100 shares of AGQ if I feel AGQ is beginning to stall short term. In fact I did just that the other day. I sold a covered call for $1300 because AGQ felt like it was going to dip a bit. And when AGQ did dip I went ahead and bought the call back for $900 and pocketed an nice little $400 profit. It seems like many of the guys on this blog need to start getting a little more sophisticated. There is more than one way to ride this pig. It doesn’t have to be all or nothing.

  513. Danno

    Just FYI. I did not mean to call anyone ‘stupid’ for ditching gold. I do agree that gold is RIPE for a short term profit taking sell off that could wound gold for months. Personally, I am holding onto gold and hedging my long position. If gold gets whacked I will take the profits from my hedge and buy more longs.

  514. Moneyman

    Gary will nail this one..

    Bought some more spx futures..Rallytime!

    And one more thing..You dont see hard words on Docs blogg..We missed the gold rally..Bla bla bla..

    The reason is becuse he often answered question like this?

    “I dont know”
    “Maybe”
    “Possible”
    “I’m not so good at predicting coppers short-term swings”
    “I dont have a price target”
    “Cant do that”

    Gary take some time off..Dont read the blogg to much..Stay away..

    Take care all!

  516. Danno

    One problem any blogger runs into is the issue with making a trade public. When trading in private you are free to 2nd guess yourself and reverse yourself to your heart’s content. But a blogger has a much harder time doing that. There comes a temptation to ‘defend’ a position when (if you were trading in private) you would never have that level of pressure. Hateful trolls only exasperate the problem as the blogger feels even more pressure to defend his choices and runs the risk of losing objectivity.

    It’s kind of like the scientist who analysis something and actually affects the outcome by the mere fact that he was observing. A blogger has all these trolls observing, and they are bound to affect the blogger’s experiment.

    Not saying Gary was wrong. Just say’n. A blogger’s job can be a bitch.

  517. ALEX

    F.W.I.W.

    I Have been trading the markets , buying and selling Coffee ( CBOU , JVA, etc) and some oversold equities too.

    BUT

    I am turning my attn to Miners again. I invested in them when they BOTTOMED in mid JUNE. They rallied nicely , some 40 to 60%. Then they got a little caught up in the MKT FLUSH OUT…BUT, for many…They are near 6 month highs, NOT LOWS like the MKTS.

    The MARKET IS BACK AT THE LOW YESTERDAY -500 Dow move, HOWEVER, Many Miners are Breaking out with GREAT volume just recently.

    Earnings are coming out…OIL has dropped from $112 to $80 ( which is GREAT for their profits, Gold hits $1800 , GREAT for their profits. )
    I see Buyers stepping in , recognizing their value. SEE:

    http://www.screencast.com/t/NkkCF8kH0esm

    http://www.screencast.com/t/qSCiydBi

    http://www.screencast.com/t/uCRKqOUfF0

    http://www.screencast.com/t/SAx60S7Q

    When this Market bounces, I still think these will fly…I bought AG, EXK, RIC and GPL recently

  518. ALEX

    FRANK

    Been reading your posts too , and it does seem like some of the better junior miners are ready to move ( you mentioned GSS and JAG , I believe).

    I think the markets are bottoming here, and I think MANY of the miners showed strength in that sell off , are showing Real buying strength now, and will show more strength in the future.

    Time will tell!

  520. Avann

    Danno, regarding that hedge strategy. Do you find that more profitable then just reducing your position size?
    I’m not challenging … I am truly inquiring whether hedging like that is more profitable then just scaling back.

  521. Shalom Bernanke

    To answer Avann’s question, 100 shares of ZSL does not hedge 100 shares of AGQ.

    He needs 1,666 shares ZSL for every 100 AGQ, if he wants to be “perfectly” hedged. Even then, after commissions and wide spreads on less liquid vehicles, it will lose money in costs.

  522. Danno

    Shalom Bernanke,

    You have no idea what you are talking about! ROFLMAO. Just stop typing before your embarrass yourself further.

  523. Danno

    Avann,

    Position size is not a factor. All positions should be protected at all times. When is it ever okay to lose money? It is never okay. Capital preservation comes before all else. Many small losses add up to one big, fat loss. The only money you should be willing to lose and gladly so is the cost of your insurance (hedge).

  524. Frank

    Just to be clear, the likes of JAG and GSS are “bad” miners with operational difficulties. In the grand scheme of things, it is better to hold winners like NGD. But NGD had its own potential problems: not operational but political when leftists were trying to shut down a mine in Mexico.

    If you want some bigger cap laggards with operational problems then we have AEM and possibly AUY.

    Another that looks interesting now to me is SBB (TSX).

    My problem with GDXJ is that it has too many silver miners. And GLDX has some garbage in it.

  525. Shalom Bernanke

    Danno obviously doesn’t know math, and better quit trading till he learns. 🙂

    If AGQ drops 5%, ZSL will rise 5%

    AGQ in your above example (at $200) loses $10/share= $1000 loss

    While ZSL gains only .60/share=$60

    That’s it from me on this topic. Listen to Danno at your own peril.

  529. Danno

    Shalom Bernanke,

    Maybe if you bothered to read my post you my be able to keep up. The ZSL hedge is for a 2008 style debacle that murdered gold and silver along with the market. Look at the chart. See how far silver dropped. In such an event ZSL would skyrocket. I’m not concerned with a piddly -5% paper loss on AGQ. I’m not planning to sell AGQ. And if there is a steeper pullback, say -20% drop in silver my puts will easily quadruple in value, softening the short term pain and providing capital to buy more shares of AGQ. I’m not aiming at a 1:1 hedge for short term pullbacks and I never said I was. But for a scary, unexpected, seriously painful sell off… my hedges will EXPLODE in value.

  531. Danno

    Shalom Bernanke,

    Like I said. LEARN HOW TO READ.

    “Worst case scenario if silver crashes and burns like 2008, ZSL will skyrocket. And for protection against a milder pullback I also bought about $700 worth of SLV puts that don’t expire for two months.”

    I have no respect whatsoever for any clown who would mock a guy for buying insurance. One day the market is going to ass rape you.

  532. Avann

    OK thanks Danno and SB … I think I get it.

    SB is saying that the insurance is a waste of money in cases of normal, everyday market movements.

    Danno is saying it is there for protection against a major catastrophe.

    Thanks

  533. ALEX

    DUUUUUUUUUUDE

    Thanks for your post, its good to look at both sides of the trade for sure…

    I looked at the comparison charts that that guy posted , comparing SPX head & Shoulders with GDX.

    So far, its not a fair comparison for a few reasons-its not apples to apples the way I look at charts.

    The SPX had glaring weakness when you examine it forming the head & Shoulders and approaching its neckline…It collapsed.

    The GDX, shows support and strength as it approached its neckline ( which it has decisively moved away from Already)..SO FAR it is Not a head & shoulders.

    these are weekly charts, so GDX at wk end will be clearer, but so far…a High volume break UPWARD , AVOIDING a break down at the neckline has occurred.

    http://www.screencast.com/t/2qB62091eyYZ

    http://www.screencast.com/t/QfQjfKF8U

  534. ALEX

    Breaking news

    Possible ban on shorting in European stock mkts.

    also jobless claims coming out soon

    I am gone for the day …Could be a bit wild today…Have fun 🙂

  535. ALEX

    p.s. w/regards to the GDX weekly chart-

    …the Wkly GDX chart is obviously ‘incomplete’ until this wk ends, but if they continue upward…it is a huge wkly volume moveUP.

    IF IT BREAKS DOWN- IT WOULD BE BAD NEWS….I DOUBT GDX BREAKS DOWN WITH RECENT ACTION.

  536. Dubbelito

    Hey guys and gals,
    I’ve been thinking about the Dollar value clause that Gary has said; it needs to go down in order for stocks to go up.

    But the thing is we are now truly in a global crisis situation, where there is currency debasement and bank sector threat of failure all over the place.

    the $ index counterweight consists of six different currencies (EUR, JPY, GBP, CAD, SEK and CHF) all weighted differently. Suffice to say that EUR is 58% of that basket and CHF which is smallest is 3,6%.

    What if G7’s Central bank Top Bananas decide they want to go on a global-a-go-go debasement rollercoaster together? ECB, GB and Japan starts a printing spree (CH joins the party, heck, they already started!) that is equally matched by the US?

    This would in effect mean that (pure arithmetics I agree, but still) the US Dollar index remains as is, but with tons of more cash floating around.

    Food for thought.

  537. Michael (Hulk)

    Danno, you do sound like an adolescent who has come on here and recently discovered something new and exciting in the form of hedging. Hedging with -$50 is the same as taking exposure of $100 down to $50 by selling $50 (I realize that your account is a little bigger in real life). I don’t know how many pros you know, but more positions is often more complications and they sure don’t use often-flawed instruments like ZSL and AGQ. Relax and learn something here, son, and watch your language while you’re at it.

  539. SF Giants Fan

    Ok, now if we can get everybody running for the exits at the same time on gold, should be a wild day.
    Swing high on gold is a close below 1740 correct ?

  541. Shalom Bernanke

    Thanks bamster. I’m trying to see them through to the other side of this bear market, and expect that to take some time.

    Same plan as yesterday and the day before. 🙂

  542. Shalom Bernanke

    With regards to this potential short selling ban in Europe, it could play out many ways. My initial hunch is why would any European with retirement funds keep them long in stocks? I’d be inclined to sell and buy metals almost immediately, even at elevated prices.

    I’m not buying metals today, but this would make me re-examine that idea.

  547. deshy

    SB: Just trying to learn. Can you explain your logic of the short selling ban and Europeans going to PMs. Are there 2 different thoughts there or are they linked? I was thinking more the ban gives (may be false) hope that equities will be saved and hence be positive in the short term…

  548. Shalom Bernanke

    WW,

    Yes I did, lost back the majority of my profits on the trade (was up big), and added more into the weakness early in the week.

    I’m unconcerned about the unrealized P+L and am focused on working into significant positions with a decent cushion for a longer-term hold, possibly the rest of the secular bull.

    I’ll still do shorter term trades, like selling 30% of PHYS yesterday, but I want the miners for the biggest move of the bull.

  549. Shalom Bernanke

    deshy,

    Those thoughts are linked, but that is only a hunch. I really have no idea how it’ll play out.

    I suppose at first glance people will get long stocks b/c they can’t be sold short=less selling pressure. But if I were a European with a 401k, the short selling ban would reek of desperation, and I’d consider selling stocks (long in 401k) and at least park in cash until I decided what to buy (likely metals).

    I do know that rigging the market as they’re talking about never works in the long run. People lose faith.

    We’ll see.

  552. Shalom Bernanke

    Unlike 2008, gold is at all time highs and investors are aware it outperforms during uncertain times.

    At a minimum, I think 401k investors will stop contributing. I would.

  557. Avann

    I know this is very early … but maybe we have our answer with respect to whether miners follow PM or the stock market.

    So far anyway they seem to be following PM.

  559. Blindweb

    Sold all my Oct ugl otm calls bought in July (85% originally). Kept my Nov-Dec GDX,GDXJ,SLW otm calls bought in July(15% originally).
    I think gold might hang out at these levels for a bit. I’ll be looking for a place to reenter to ride to $1900-$2000. Then I should be out completely

  560. auger

    Avann, I suggest watching SLW, for clues for miner direction (it’s a GDX holding). On an hourly chart, SLW has a pattern of descending scallops. I posted a chart with a suggested sell zone, that triggered at the EOD.

    The miners’ true master, is Gold, no doubt and I think Gary’s original contention that they will sell off further with Gold, is correct. That is how I’ve been playing it, anyways; sell the rallies.

  563. Frank

    Crap. I was thinking yesterday of hedging by way of the CHF. Today it’s down 5%.

    Currency peg? Ha. That will never happen.

    p.s. In the Spring of 2010 I came within seconds of moving at least half my cash to CHF.

  570. Russell

    Can anyone who is a veteran of cycle theory give me a number for GLD that will confirm a swing high. Also I’m looking to the QQQ trade with a swing low conformation. My numbers are GLD 171.62, QQQ 53.08, and SPY 117.64. Am I correct?
    Thanks in advance,
    Russ

  573. Billy

    Technically the swing high on GLD came today, it’s tough using GLD though as gold trades 24 hours. The swing high for gold is currently right at $1740.

  576. Russell

    James R,
    Thanks, as the market has the habit of selling off at close, I’m going to enter when I’m sure 53 will be posted at close. Probably enter my position at 3:59

  578. High 5

    at ease

    With the European banking crisis brewing and the Germans well founded hesitation to fund the bailouts, I just ‘feel’ like the markets are nearing an edge. I’m not a gambler and want to be in cash for the time being. Will be ready to add to core when the time comes, and from here on out will stick to gold/silver trades.

  579. ...at ease

    High 5, I understand, I feel more comfortable in PMS also, but Gary is good at picking bottoms, so we should be going up now. Buy some GLD Puts. I should have bought more. 🙂

  581. High 5

    at ease,

    I trust Gary on cycles as well but think cycles work best during ‘normal’ market conditions. Too many exogenous variables here with government bureaucrats changing rules and banking opacity on a daily basis.

    It’s much harder for government and banking pukes to control gold price movements.

  585. William Wallace

    High 5,

    My feelings also, trust cycles but know these b-rats can corrupt the cycles the way they corrupt government, so im probably being overly cautious because of it.

  586. Gary

    Cycles worked fine during the 08 crash. The only time cycles have faltered was during QE when they had a tendency to stretch.

  587. Ken

    Congrats to those who had the balls to buy longs over the last three days. When we clear yesterdday’s highs and then 1180 on a closing basis you’ll see a lot of sideline money hiding in cash, bonds, and gold flow into the equity markets. We are going to see on of the worlds biggest shortcovering rallies of the last 50+ years. I’m taking 5% of my portfolio and buying a basket of way out of the money calls on everything that has been beat to shit and trading the most away from their 50/200 DMA’s over today and tomorrow. These calls expire next Friday and should be 5-10+ baggers in less than 5-7 trading days. Get you some!

  590. High 5

    “It is incumbent on every generation to pay its own debts
    as it goes. A principle which if acted on would save one half
    the wars of the world.”
    Thomas Jefferson

  593. William Wallace

    Ken,

    Share your options with us…If you havent noticed I ask traders to “Give me an option” and I choose one and take the position. Last was one of Miyagi’s GLD calls that turned out good but I gave it all back when I reversed position and gold continue higher.

  594. TZ(8155)

    Bought in here with a stop just above the lows. I think this might hold and then we rally back up towards the close by friday.

    I’ve already gotten stopped out once this morning. So I dont know if I’m just being aggressive or pushing things too much in all this volatility.

  598. ...at ease

    High 5, I trust the cycles. I have already seen too many events simply sideline them for a day or week, but they continue on as predicted. Sometimes the events don’t all all into together and get a bit skewed, but over all, cycles work better than anything else I have found. I think events and expectations are already priced into the market, so it is much simpler to just use the cycles getting in and out.

  602. Harry

    Sold a bunch of Sep GLD $195 calls yesterday for $1.37 apiece, bought back just now for $0.95. Just having some fun here 🙂

  605. William Wallace

    Gary,

    You ever see the movie Armaggedon?

    You know when they are all drilling the hole in the asteroid and Ben affleck and a few of the other guys who got seperated when the shuttle crashed, and everyone sees they are still alive they start yelling each others names…I think it was Ben Affleck who starts screaming (after he sees Bruce Willis) HAAAARRRRYYYYYY!!

    Thats what I was thinking when I just yelled GGGAAAARRRRYYYYY!

  606. William Wallace

    at ease,

    Im confused..Those are puts or calls? I dont know much about options..as you know…but if you bought puts are you not expecting gold to drop, which would bring GLD lower?

  607. Wav_ridah

    Auger,
    It looks like support at 30 should hold if/when it breaks out of that bear flag. Mahalo again for the chart. SLW has been on my watch list.

  611. RJ

    Alex,

    I like the looks of RIC as well. Seems like a solid company. 5 bagger+ the past few years.

    Do you think they can get their market cap to a billion?

    Any other folks here invested in DIC that can shed light as existing long time shareholder?

  614. auger

    Wav_ridah, you’re welcome, just posting what seems to be revealing itself, in the charts. SLW is a good indicator, IMO, for PM’s and the overall market because it’s traded by the HFT’s. It’s always running lock-in-step with something, it seems.

  615. High 5

    WW

    I still am not comfortable going long equities because I have a seriously negative expectation for the economy. Add in the b-rats (LOL) and I lose sleep at night.

  617. auger

    It’s hard to say whether 30 will hold, if Gold were to break down, near term. But, it looks like a reasonable target, *if* that is a bear flag

  620. St. Deluise

    you know what, i gotta stay in the new lows camp.

    what this probably means is that i’m going to miss a huge chunk of the move up waiting for a double-reverse non conformation thing, but i guess this is just one of those weeks.

  621. William Wallace

    at ease,

    Understood…thank you. So when you buy your calls $2-5 below the current price they are deep in the money? Aren’t they (calls) out of the money when they are trading below the strike?

  622. ...at ease

    Calls OTM (out of the money) are above the current price. In the money or at the money is the price or right below the price on calls. DITM is about 5 lower than the current price.

  623. Movax2

    High 5,

    I’m sure you realize this, but trading on short term calls, like going long the market right now is not based on any economic fundamentals.

  625. Hack

    PM purchases yesterday:
    EXK – up 8%
    SLW – up 2%

    IMHO I wouldn’t short silver or gold here. I lost a little on ZSL Tuesday. Not gonna make that mistake twice..

  626. William Wallace

    Gold will not break down below 1740until the market puts in a swing low probably…I would like to see the swing high in gold and the swing low in the market occur in the same day.

  627. ckpc

    TZ(8155)said:

    “Bought in here with a stop just above the lows. I think this might hold and then we rally back up towards the close by friday.”

    “About 5x.”

    Could you give a little more clarification about what you’re referring to? What did you buy into…the S&P, QQQ, gold, GLD?
    Thanks!

  628. gold silver troll

    I believe that Gary is going to be correct here about this gold’s decline

    he is one of the very few people calling for 1200-1300 gold on a d-wave.

    Most people would laugh at it saying gold is not gonna correct $400 and start calling it a bear market (bubble pooped) when we hit 1200-1300

    this gold’s decline should be interesting

  632. High 5

    Movax

    I find it difficult to trade short term since I have always been more of a strategic investor. Gary has been helping me in this area but still have trouble sleeping with certain counter trend investing.

    To me that means, currently, short PM and/or long equities (including miners).

  633. Billy

    The safest place to short gold or silver will probably be if/when the next daily cycle fails. We are pretty late in the daily cycle here so we should probably see a very sharp quick drop into the DCL, then a rally for a few days followed by a failed cycle falling into potentially an intermediate and D-wave decline. I will probably take a small short on silver once we get the swing high but it will be a quick trade as you might get a sharp rally out of the DCL.

  634. LowTax

    No swing-low in QQQ yet. Maybe tommorrow. Until then we have what appears to be a pennant forming. And SOS on SPY is building up… ugh.

  636. Chrys

    from Jim Sinclair…

    Now that we have reached $1800 gold, what should you do?

    1. Those holding gold to hedge the systemic risks of the Western Financial world simply stay in your position.
    2. Traders lighten up your positions as gold approaches the next two Gann Angles (1849,1936).
    3. No market fails to have reactions at some point.
    4. Reactions in this market will be deep, but brief when they occur.
    5. The undervaluation of good gold shares has passed manic.
    6. Utilization of some of your gold profits into good gold shares is pure logic.

  637. High 5

    The FED zero interest rate policy promise means mortgage rates at historic record lows.

    I intend to max out my mortgage debt and have it nicely paid off, during the next 5 to 10 years, through inflation.

    Let the sheep pay down their low interest debt.

  640. MrMiyagi

    WW,
    Not the best time for lotteries because of the big jumps on equities.
    The only one that is interesting is SLV September 30 put but it will be better to wait until a better time.

  646. MrMiyagi

    WW,
    If this rally sustains itself for a good stretch then I’d look into a small play on something (even SPY/QQQ) or a stretched equity.
    Until then, small non-lottery holdings should work out ok, I don’t expect a straight run upwards as there is a lot of nervousness out there.
    Any good news (real or not) will push it up, too bad they did the fake Osama death news earlier this year, sure would have worked to their benefit now!

  647. LowTax

    Damn it, that SOS just won’t quit! I’m starting to think we see lower prices first until this Europe thing gets settled down… People are unloading…

  648. Le Fou

    … at ease

    No need to rip the cover off. Just ordered it for my Kindle, $8.38.

    Big bargain, and I have already.

    Thanks,
    Le Fou

  656. MrMiyagi

    WW,
    That’s good, add it to the stack.

    Yes, I was thinking if we see a good progression here on the markets, at a point there will be an opportunity to get some puts or short some stocks.

  662. Billy

    Gary mentioned that we would see lots of SOS during this bear market rally as the big boys are getting ready for the upcoming bear. It may or may not affect prices at this point in the move.

  667. Billy

    Kitco showing a low for gold at 1739.20 so we have a swing high. Probably gonna look for any strength in SLV and buy some puts into that.

  675. rapper

    gold needs to crack 1730. Last time it needed to crack 1722 and touched, dipped a bit and then faked out and took off. will that happen again here?

  677. Avann

    Yeah … I just checked another chart and Gary’s right (as usual). I wonder why different systems use different clocks …

  679. BBPOINT

    Hi Veronica,

    Could you tell me your system status ( It’s in the buy or sell zone and the buy and sell signal number). because I do not understand when you say: “Sell on my system is really flying up now and is at 1670. If it sells tomorrow it would be a $150+ gain”

  682. Silverhound

    Potential Head n Shoulders pattern forming on the hourly chart for gold. Neckline ~1720. I don’t put huge faith in these patterns but sometimes they work.

    The “big moves” start with the “little moves”

  684. Avann

    On the chart I usually refer to it showed the high occurring yesterday … I checked what I consider a more accurate chart and it shows the high occurring today … well both charts are accurate it’s just the timing that’s in question.

  688. Billy

    No doubt about the QQQ swing now. Are we waiting for S&P swing to make the actual confirmation or does the swing on the Q’s count?

  689. Silverhound

    Harry you picked the wrong time to enter ZSL. The place to get in was when silver was at the top of it’s trend channel not half way down to the bottom. Thats just asking to get whipsawwed out of your trade.

  692. samppa_nyman

    one thing I’ve learned though is to trust Gary when he says don’t short the bull. That stupid ZSL looks to make sense but always just teases and makes no profit.

  693. Hack

    Yeah I got whipped, but re-deployed the money into miners and came out way ahead. I know when a trade is going against me and I don’t hang around losing money…Besides silver is going back to range trading so I won’t touch ZSL again.

  702. Silverhound

    Gap fill on NDX is at 2175 on the houly. Expect a few shorts to be seeded there.

    Bottom of the gap acted as resistance 2 days ago and stopped the rally after the fed anouncement.

  703. aklaunch

    5 more buyers than sellers? Does that mean the big guy is selling to the little guy?

    My guess is after a quick scary correction Gold will drive to new highs in the next week and come crashing down. The same little double nipple top like on SLV’s chart?

  705. William Wallace

    If I get the swing high gold, swing low market same day that I was looking for, going to add to my TQQQ position tomorrow hopefully on a small pullback and looking to load up on GLD puts at 1760 gold

  723. SW

    Hi Gary (or anyone,)

    Gary said, “Outside day for gold. Not possible to form a swing until tomorrow.”

    What is the reason that an outside day prevents a swing the same day? (swing low, in this case) Thanks!

  729. Gary

    I didn’t know I fell out.

    I do know that the odds are better buying something that is in the process of putting in a major yearly cycle low than trying to squeeze every penny out of a parabolic move.

    I also accept that I won’t get the timing perfect in this kind of volatile environment, so I don’t even try. I just need to get close enough.

    I know that gold should not be trading parabolic during a first daily cycle. If this was the third daily cycle I would have no trouble riding the parabola. I have no historical reference for this sort of move this early, so I have no idea how it should be traded.

    In that case I prefer to take the less risky stock trade and avoid what could be another huge mistake, like May.

  733. Billy

    I’m gonna add a little bit right before the close, but really hopeing for a little bit of weakness tomorrow to get a little more aggressive. We may just get the bear market rip that Gary has been calling for though.

  735. Shalom Bernanke

    KAL,

    Not rules in particular except that I never enter/exit trades in after hours sessions. Same with before market opens.

    On balance, pre-market “mistakes” have cost me a bundle. Typically after a good run if I saw my stock down a bit pre-market, I’d try to beat the rush so to speak, and often by the time the market opened everything was fine or higher.

    Just been my experience, they don’t work for me so I don’t do it anymore. I wait until all the players are at their desks (more participants) before I try and judge price.

  743. TommyD

    Swing low, sweet chariot
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home

    I looked over Jordan, and what did I see
    Coming for to carry me home
    A band of angels coming after me
    Coming for to carry me home

    Swing low, sweet chariot
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home

    If you get there before I do
    Coming for to carry me home
    Tell all my friends I’m coming, too
    Coming for to carry me home

    Swing low, sweet chariot
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home

    I’m sometimes up and sometimes down
    Coming for to carry me home
    But still my soul feels heavenly bound
    Coming for to carry me home

    Swing low, sweet chariot
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home
    The brightest day that I can say
    Coming for to carry me home
    When Jesus washed my sins away
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home
    Swing low, sweet chariot
    Coming for to carry me home

    If I get there before you do
    Coming for to carry me home
    I’ll cut a hole and pull you through
    Coming for to carry me home

  744. ckpc

    William Wallace said…

    Gary,
    “I dont think you need to explain yourself.”

    Personally, Gary, I am very happy that you did explain. I was feeling a little confused about nailing the perfect IC bottom call and then exiting (for a nice profit) instead of holding “old turkey.” I’ve only been around for about 6 months and thought that getting the opportunity to go “old turkey” was the purpose of finding the ICL.
    What you just explained makes perfect sense and I don’t feel confused and conflicted anymore.

    Thank you so much for taking the time to clarify that. Especially when you are in the midst of entertaining company.
    Very professional.

  745. MrMiyagi

    Not much of importance in earnings report for tonight aside from GPL holders.
    Tomorrow only interesting one is NVDA in the techs.

    Hopefully the uptrend will continue but perhaps a tamer climb will last longer? Or just go up 400 more points for a couple of days and end it.

  746. Michael (Hulk)

    The play here for the House(s) that took the other side as the world sold out and bought puts and VIX volatility hit 48 (akin to flash-crash 2010, 2001 bear dump, 2002 bear dump, 1998 crash) would now be to “burn” the September 19 (and obviously August) option expiries.

  754. Le Fou

    KAL,

    “Three huge QQQ trades at 5:31 after hours… 4 million shares total at $50.89.”

    Is that correct? 50.89? That’s quite a drop from the close.

    Le Fou

  756. KAL

    Yeah, Monsier Le Fou, that’s right. Price popped right back to $53 or so on the smaller trades after that. You can see the downward spike in the aftermarket price action.

  757. Le Fou

    TraderLady,

    Thanks. The link you posted shows this:

    After Hours Low: $ 50.8917

    Those big players either got hosed or it was a print from an earlier trade that was printed late.

    Good trading,
    Le Fou

  760. KAL

    So, either a late print or somebody offloaded 4 million shares more than $2 below market? Who makes those sells? Who gets the other side… The broker making a market on the trade?

    Please pardon the ignorance and thanks.

  763. Silverhound

    I have a question for the Americans about their financial instruments if anyone can help. What happens to the inverse ETF’s if short selling is banned in the US?

  766. David

    They weren’t affected during the short-selling ban in 2008.

    Of course, they were affected by the massive short-covering rally that ensued after the ban was instituted. So while there is little risk of being forced to cover by a “surprise” short-selling ban, you do have considerable market risk when you play the short side.

  770. David

    By the time you hear of a short selling ban it will be too late to sell your inverse ETFs.

    Ask anyone who owned FAZ when the ban on shorting financials went down in 2008.

    Of course, the financials eventually resumed their decline, but you would have had to endure a hellacious drawdown, and I’m sure many people sold out at a loss.

    As Gary has said, the powers that be will not make shorting easy. They know how short-covering panics work and will do what it takes to ignite them. It will probably be a lot easier and more profitable just to go Old Turkey on the PMs when the time comes.

  771. Duuuuuude

    Every time the stock market pushes higher, CNBC thinks it is because some brilliant people out there are finding good value and the economy is great. Every time the market tanks, it is the machines. I guess that must be how the market works……

  772. SW

    Hi Gary,

    Question: A lot of good eyes here expect no straight down in gold. But isn’t it that a parabola tends to collapse even faster than its up move? You gave some parabola examples like silver and crude oil and they all sank faster in time and farther in distance (going below the point a parabolic move began.) Thanks in advance, Gary!

  773. MrMiyagi

    Shalom, traderlady,
    Look at page 5, around 17:31.
    I had posted last night of some huge positions, something like 5 million on QQQ and over 16 million on SPY in big blocks.

  775. jeff

    SW compare how far silver was stretched over the 200 DMA during its Parabola run in May versus Gold now. To a first order that would give you an idea of the magnitude of correction for Gold.

  776. Gary

    Silver is a very thin market. The only time gold will ever stretch 80% above the 200 DMA like silver did will be at the top of the bubble sometime in the future.

  780. MrMiyagi

    KAL,
    As was mentioned last night, perhaps a mutual or hedge fund was forced to liquidate positions but what I don’t get is why not sell during the day at higher prices?
    Yesterday I felt that it was bad news to have big blocks like that going and I still feel that way.
    Maybe it means nothing but I don’t know.
    At this point I’d like to see the market go up in small increments; 400 point plus days on the DOW are not sustainable, 50-75 are.

  781. Rob L.

    Anyone else notice that with Gary’s absence, many of the best traders here who have regularly posted wonderful comments, (DG, TZ etc.) are absent as well?

    The haters here need to go and play in a busy intersection.

  785. Veronica

    BB, my system is long gold from 1518, and the trailing stop is at 1719 currently so it will generate a 200 point gain if it sells tomorrow.
    William Wallace, I’m a dude, just using my daughter’s G-mail account:)

  786. Bob loves Hawaii

    So far, nothing usual is happening with gold, silver, miners, and the stock market. This is not meant as a criticism of the cycles but we must be open to being wrong.

    Maybe once this swing low in stocks is established gold will have its correction, but I think it is naive to think gold is going to D wave when there are simply no attractive places to park your money without a derivative risk.

    Gary, one thing you said that resonates with me, never short a bull market, the surprises come to the upside, and keep a small position in gold always.

    This advice from two years ago until May served us well, now abandoned. Confused as to why.

    Simply look at the oil market, there is ten times the contracts that can possibly be executed, ditto for everything else. Gold and silver are opposite, incredible levels of shorts to the physical.

    Physical gold and silver has no counter party risk, and impossible to conj er out of thin air.

  788. Gary

    Bob,
    I’ve always said I would completely exit if I thought a D-wave was coming.

    I’m not convinced it is right around the corner yet. But I do know I don’t like the extreme divergence in miners. We have never really seen anything like that during the last two years.

    Of course the fundamentals always look the best at tops. There were a million reasons for why oil was going to $200 in the summer of 08, but all it took was one very good one to break the parabola. We were heading into a recession.

    At the top of the gold bubble there will be absolutely no fundamental reason to sell. But there will be one very good reason why we will sell. It will be because gold will have become extremely overvalued and stocks extremely undervalued.

    And as I have said many times in the past liquidity will always find it’s way into undervalued assets. Right now that should mean liquidity will drain out of gold and flow back into a severely beaten up stock market.

    But it will only be temporary.

    Don’t forget a D-wave doesn’t mean the fundamentals have changed. It just means it’s time for a profit taking event.

  789. Beksachi

    Gary,

    Historical mean of the S&P 500 P/E ratio from 1871 to 1995 is apparently 14 or so. From 1995 to 2010, it was ~28.

    I am not sure what today’s ratio is (after the crash) but I am pretty sure it is not close to 14 yet. Also by law of mean reversion, P/E ratio may undershoot.

    My question is how can we tell the market is truly undervalued?

  790. Frodo2122

    I am a subscriber since March.

    I will forego my horror story of bad timing. 🙂

    imo, I think that Gary’s realization that he needs to back off from hand holding, answering all of the bs emails, all of the bs Gary, Gary, Gary posts, etc. is a very positive step. It’s let him focus on trying to make the correct calls, and takes away the baby sitting space of numerous frivolous posts and inputs.

    I too regret that others like Polly, TZ, DG, etc. have backed off on posting.

    Even though this is a great space for sharing ideas, imo, it is impossible for one person to meet the needs of all of the dreams of different mindsets involved…the short term action junkies, the old turkey junkies, the newbie lottery play junkies, etc.

    I fully endorse the idea of releasing the noose from Gary’s neck, and using him as one of the tools.

    I appreciate the input from the others as well…Alex, Miyagi, Veronica, Farm Girl, and even the dissenters, etc.

    My recommendation would be to open the blog up, rather than shut it down. Gary is now focusing on his reads, and in general, is not going to impacted by blog inputs, so he is turning the blog over to us.

    Anyhow, thanks to all for the inputs…this is a great blog, and I encourage us to open up, rather than close down.

    And a big THANK YOU to Gary for your efforts. You are ONE of my tools, and the Toby angle makes you one of my favorites. 🙂

    Good luck to us as we try to navigate the yellow brick road!

  795. Farm Girl

    Totally bogus.

    “Price earnings ratio is based on average inflation-adjusted earnings from the previous 10 years (Shiller PE Ratio)”

    AAPL
    2010 Actual eps $15.15
    Shiller eps 10yr Avg $3.84
    Actual P/E 21.7x
    Shiller P/E 85.6x

    Similar numbers for the largest S&P companies. You think the market is going to let you buy AAPL based on $3.84 earnings?

  797. Wav_ridah

    Look, the S&P is overvalued. Wasn’t it you saying the S&P was undervalued in July? Hopefully no one took your advice and bought at the top.

  800. Poly

    I think we need to be open to a 2nd stretched “super daily cycle” coming in Sep through Oct followed by a failed 3rd daily to mark the end of the gold C-wave.

    It’s early still, but if this were the final c-wave top, I would have expected a massive reversal to have commenced already.

  801. Dubbelito

    Interesting point Poly,
    what would then be a prudent thing to do? Try to time the DCL, ride with it and then place a stop 1-2% below the confirmed DCL?

  803. Poly

    Yes agree Dubbelito. We first need a good DCL cleansing and we do not want any new high’s from this point. It would be hard to time a DCL on this one though, obviously this one was far from average and where it finds a DCL is anybody’s guess. But when we do, it would provide a great low risk entry point in the event this 6 week young IT cycle has many more surprises in stall.

  804. deshy

    Poly: By ‘good cleansing’ are you referring to price, sentiment or both? ..so do you follow if shallow DCL and sentiment still high?

  805. Poly

    Sentiment does not concern me so much, plus wouldn’t you expect gold sentiment to eclipse the 2008 highs if this is a higher and bigger C wave? It’s the 11th year of the bull!

  806. William Wallace

    Poly,

    I would think that this top will not just fall apart quickly, too many buyers on dips still. Like a drunk dude being beat up, knocked down stubles back up, knocked down again and stubles back up again…until so beat up and weakened getting up gets harder and slower each time until gravity takes over.

  807. ddn3f

    Poly,

    As for a second super stretched daily cycle for gold, that would be interesting. Everyone has on their minds the silver crash. It is fresh on everyone’s mind, not just here but everywhere. So many comparisons between gold’s current run and silver’s parabolic move and crash in April. So if you wanted to shake off the most people and draw in the public, a second stretched daily cycle would do it. I feel like the public is not in yet. They might talk about it, but I’m not sure if the public has bought. I have nothing to back it up, so please prove me wrong.

  810. ddn3f

    WW,

    From what I see, C-wave tops in gold are not rounded tops. If it is a C-wave top, then it is acting strange. Heck, there’s been so many strange things about this run. What’s one more strange thing.

  811. mikezza

    to anyone experienced with cycles,
    is there any historical precedent for a new cycle in equities to top in only a matter of days and form an extreme left translated cycle. is it possible for this cycle to fail very quickly over the next few days.

  814. Poly

    All I’m saying, it’s a possibility that many are not focused on, it deserves a probability weighting and therefore should make up part of our trading framework/plan. On the flip side, it would be naive to ignore the stretched run we’ve had, so focus on risk ever more so.

  817. Poly

    Mikezza,

    Very unlikely when you consider it’s an IT and Yearly cycle low. You expect some meaningful run before failing. However, what you alude to is further downside within the existing cycles, so possible further downside before the true yearly cycle low prints.

  819. Shalom Bernanke

    European bans on short selling does not bode well for stocks. The general market looks busted to me.

    I continue to hold 70% of my PHYS, and all of my miners. Looking to add to miners into dips.

  821. Shalom Bernanke

    Maybe we get a few days of higher stock indexes, but I would be uncomfortable pushing the upside.

    That’s just me, and I know the cycles say otherwise, but I like trades I can stay in with confidence.

    Good luck today.

  825. Shalom Bernanke

    WW,

    As I recall, the ban was only on financials and they got about a day and half bounce.

    I’m not saying we head down from here, and there isn’t even a ban on US stocks as yet, just that in my experience when something comes down as hard and fast as stocks did (and with a fundamental backdrop of slowing economy), there is typically more to come.

    I see reasons for a big rally, and reasons for lower prices, so will stand aside and continue to nibble on miners into declines. It’s the best trade I can think of at the moment, realizing it might take some time to pay out.

  827. Shalom Bernanke

    For those interested, I won’t just buy miners when they’re red like right now. I need them to puke out WITH the general market or metals (either is fine), and be down several % to start adding.

    Might not be anything for me to do today, which is nice because the weather is great! 🙂

  830. Hack

    Agree with Mr. Shalom: We’re due for a hefty pullback. An opportunity to buy your favorite stocks or sell on strength today if you don’t want to see a drawdown in your acount….

  833. deshy

    Anybody have any thoughts on silver’s relative strength even in the gold decline? Wonder whether this supports Poly’s view that there may be more to come?

  834. Michael

    SB,

    Thanks to you and Poly for your posts. I agree with your strategy and am long miners too. Can you please advise which miners you hold as long term investments, if it is not confidential. Also, have you ever compared the differences between PHYS & GTU?

    THanks in advance,

  836. Elaine

    Gold Era,

    On kitco silver is down 4 cents, that’s hardly tanking. But, Gary said that when Gold starts to decline silver will get hit particularly hard.

  838. TZ(8155)

    With gold not holding after yesterday’s drop I have a might higher opinion that the top may now be in. The alternative would be that we form another congestion of some sort and then resume higher (and I will watch for that), but as of now I’m just at core and watching.

    PS: stopped out of two trades yesterday and one this morning buying gold for a bounce and resumption of the uptrend. Clearly volatile and much harder to read now.

  839. Shalom Bernanke

    Michael,

    The main thing is to trade small enough positions to keep your overall portfolio risk at a manageable level. This lets you take advantage of declines rather than force mistakes. I can’t stress that enough, because there will be substantial pullbacks all along the way.

    My focus is on miners that have already pulled back 40-50% from the entire bull run out of 2008. They must have cash in the bank so don’t need to access credit markets, and I prefer mid to smaller companies that will possibly benefit from buyouts down the road (just an added bonus if it occurs). They must already be profitable, or close.

    Many names qualify, but I’ve already been buying SVM, EXK, UXG, GPL, and smaller positions in several other names. I also intend to buy NXG (not so small), and if we get a sizable pullback from here, I would even get into NUGT again.

    As far as GTU, I looked into it some time ago and it seemed fine. For whatever reason I decided on PHYS (maybe Sprott seems trusworthty), but it shouldn’t matter if we’re right about gold. Miners are where big money can be made, but only buying into volatile moves to the downside. Chasing is never recommended, and especially in what could be the start of a bear market.

    I believe most of these stocks have seen the worst of the decline even if they don’t rocket higher immediately. One can always nibble away in small amounts as they work into a position, but I’m confident that we’ll all want miners as the bull matures. I’d rather be a bit early and take some pain knowing I paid great prices.

    Hope it helps.

  840. Shalom Bernanke

    One added bonus, if things collapse (not saying they will), miners will see me through to the other side, albeit with a wild ride.

    Next best thing to physical, with significantly more upside potential. 🙂

  842. Blindweb

    deshy,
    Yes I was thinking that was a positive sign.

    Poly ddn3f,
    Interesting points. A nice decline to break the correlation with stocks, and then a rush back in as everyone knows where to run with a European crisis brewing.
    Exited most of my gold position but miners in the 1750-1780 area; looking for a reentry.

    Shalome,
    Yes I’m very conflicted on stocks. I’m going to stay away from them until it’s time to short. They’ve been broken too many times. Oil is moving in tandem; no relief.

  845. William Wallace

    Trading gold futures buying dips on support levels, if the market shows strength gold drops and exposes support at round numbers, if the market drops gold rallies back to those support levels which become resistance.

  846. Michael

    Thanks SB,

    Your willingness to share yuor strategy in such detail with SMT subscribers is incredibly generous and appreciated.

    Have you seen Hussman’s piece from a few years ago called “Going for the Gold”? As you may know, he is not a gold bug, but analyses the market and invests according to very well researched historical data. He is now 15-20% in gold stocks saying that these market conditions are conducive to the miners.

    Bill Fleckenstein has also added to his miner positions recently as he thinks we have reached an inflection point in public and investor perception of gold and miners…

    The big money as Poly and you have so aptly pointed out, comes in being right and sitting tight…

  847. refiator

    Pennant forming in SPY; H&S in gold. If the spooze continue inversely to the metals, this is like a Mexican Standoff. Who will blink?

  848. auger

    SB, I beg to differ that if things collapse, miners will see you to the other side.
    They are stocks, after all, and these companies will experience all the problems associated with a collapse. Rising costs, Government red tape, for example will hamper their ability to produce anything, let alone a profit.

  850. Frank

    I don’t agree re NXG. It rallied from ~2.50 to 3.40 partly due to the merger news and I am not sure if that merger makes sense long term. Among other things, the merging party has large silver production that is under contract with SLW for the typical $4/oz.

    I have large holdings and I am going to start unloading in the ~3.50s. I had a sell order for 3.35 that was a penny too high.

    If you want a down-trodden gold miner then GSS is one to consider.

  852. Shalom Bernanke

    Michael,

    I don’t know about Hussman, but did catch Fleckenstein adding to positions. Rick Rule as well, and he was an admitted seller a few months ago after the big run higher.

    SVM bought back 800,000 shares in the $8.20-$8.40 range, with option to buy over 9 million more during the year. These are the things I like to see, and I try to think along the lines of these guys.

    We could get another big hit, who knows, but I can afford to be a buyer into it rather than be fearful.

    Good luck.

  853. Shalom Bernanke

    Frank,

    Good eye! I said NXG, but meant UXG.

    Rob McEwen has roughly $350 million of his own money socked into UXG, and doesn’t even take a salary. In addition, the company has had sizable insider buying over the last few months, and McEwen himself was paying something around $6.50/share if I’m not mistaken.

  854. Shalom Bernanke

    auger,

    You might be right, that’s what makes a market.

    I doubt the next collapse will play out the same way with miners. they’ve already proven themselves, are now sitting on cash, selling their product at 2x (gold), or 3x (silver) what they were in 2007.

    I think your reasoning is what caused the recent selloff, and keeps them 50% off bull market highs currently. Everybody knows they’re value, but is afraid ’08 will repeat. If it does, everybody also knows they were the buy of a lifetime and wants to do it again, thus making it unlikely they get that low again.

    Either way, I step into them over time and have stops to take me out (albeit very wide stops).

    Let’s see how it shakes out.

  856. Michael

    SB,

    Thanks for the detail on the SVM and UXG…

    I am a bit confused, if you are holding for the long run, how is it that you also have stops? Do you have stops on all positions or only on some? Do you have some stocks that have stops and others not?

  857. Michael

    SB,

    Thanks for the detail on the SVM and UXG…

    I am a bit confused, if you are holding for the long run, how is it that you also have stops? Do you have stops on all positions or only on some? Do you have some stocks that have stops and others not?

  859. Shalom Bernanke

    Michael,

    I have a stop on my overall portfolio risk. I also have specific stop levels on each individual name only if case it acts contrary to the group. For example, if all the miners are up 10%, while one name is down 12% on huge volume, that would be one to let the stop out work.

    For the overall portfolio stop, it’s the total amount I’m willing to lose on all positions combined. I do intend to hold a good chunk for the rest of the bull, but that does not mean I don’t sell a bit after big runs…just like I did with PHYS (holding 70% of original).

    If my overall portfolio draws down to my predetermined level I will exit all positions until I get another entry.

  862. MrMiyagi

    auger,
    Silver in itself is oversold on the daily charts and is actually behaving the way TA says it should. The ETF is just following along.
    Gold, on the other hand, is still overbought.

  863. Michael

    SB,

    Do you have plans to sell more PHYS or will you just wait to buy back the 30% that you sold? Do you have an approximate buy price?

    Thx

  864. Shalom Bernanke

    Michael,

    It depends what happens. I’m not selling here, for sure, as I like selling into spikes. I can ride it down to another place I’d like to buy without any problem, but have no specific price. Too soon to tell, but will probably when it feels it’s done going down (if it goes down).

  865. auger

    Mr.Miyagi, I was remarking on that short term spike up, in the last half hour, is all. Both Silver and the market moved together. Silver is not oversold, on the daily, BTW.

  870. corporatewarrior

    :To those interested in inverse etf’s as a way to hedge against a move south in equities:

    I have been eyeing FAZ and TZA the last couple of weeks. The recent drop in equities over the last few weeks essentially doubled their share price at the bottom.

    They both work off of index swaps which, if my research has proven correct, is NOT affected by a ban on short sales.

    I am going to nibble on some calls over the next couple of weeks. However inverse ETF’s are new to me and I remain naive…research continues.

    Any other advice on these?

  877. auger

    corporatewarrior, if inverse ETF’s are new to you, then I would suggest you read their prospectuses. TZA shares are triple-leveraged, and designed to be daytrading instruments. So, buying call options, if you don’t know what you’re doing, is a recipe for disaster.

  878. aklaunch

    Mr. M.

    I believe so. My cycle count never took into account that crazy manufactured late June early July rally. It could be flawed. I just stuck with the regular count and it “seems” to have bottomed right on schedule in the prescribed time limits with not stretch. 67 days long last time with the norm being 60-70. I feel pretty good about it.

  880. David

    I wouldn’t touch FAZ, let alone FAZ options, after the move we’ve just seen. The time for FAZ was a month ago, and options on FAZ are a kamikaze move.

    Inverse ETFs in general are not a hedge. Instead of hedging just sell your longs.

  881. aklaunch

    I am pretty new to the WSJ money flows page. Just started eyeballing it and thanks Mr. M for giving me the link on one of your old posts. My question is how predictive is the SOS and BOW? I just cant seem to make any sense of it. One day GDX is SOS, The next it is up high on BOW. Back and forth.

    How do you interpret these signals. Do they have a delay? and are the signals more predictive in a calmer market.

    Also has anybody noticed a time lag for these things to work?

    Thanks for the help.

  883. Blindweb

    If today is gold’s first DCL for an intermediate cycle that would put the Jackson Hole Meeting August 26th right in the middle of the next Daily Cycle….

  884. jeff

    aklaunch I think SOS and BOW are more useful if you see persistent SOS prints (or BOW). They oscillate quite a bit so they maybe better to use as a confirming indicator rather than soley trading off it.

  885. aklaunch

    I am still amazed at how inversely gold is behaving with the stock market….. So much like Silver a few months ago. I can look at the DOW and give a pretty darned good guess of what the spot gold price is doing.

  889. Blindweb

    Pure speculation:

    Daily Cycle #2 – Starting today. We grind to $1800 for Aug 26th. Bernanke announces QE3 or QE operation twist or whatever. Gold and stocks explode higher. Gold corrects a week or two afterwards as US stocks outperform gold and more money moves to US stocks.

    Daily Cycle #3 – Massive selling on strength occurs in US stocks and everyone rushes back to gold and we get our final parabolic wave of this phase. Or…

    Daily Cycle#4 – Europe implodes more. A doubly delicious parabola

    I moved some money into Nov GLD call options near the lows today

  891. TZ(8155)

    I said earlier that seeing gold continue lower for a second day beyond yesterday’s drop has made me worry that the top is in.

    If the top is NOT in then I expect some sort of congestion for a week or so and then ANOTHER $100-150 in gains for THE monster peak. If that looks to be panning out then I’ll try to jump in hard.

    In addition to the technicals a few other things concerned me this week suggesting a top:

    -JPmorgan and Goldman *both* upped their targets for gold. And they did it quite publicly. This often happens near peaks in my experience (to draw the remaining public in once the firms sense things coming to a close). If they really thought it was going higher and wanted to make money then then would have bought or upped it quietly to their inside clients. Again…my opinion only.

    -I had three friends contact me in the last week. They all know I trade these markets and that I’ve told them they should buy over the years. When they contact me it usually means the public optimism has reached a certain trigger point where the masses are responding. Happening more at peaks than not. (Although we’ve said many times that at SOME point in this bull mkt the public will respond and buy and will be right…gold will just keep on going up. Question is if that is now or not yet.)

    Anybody else have observations about people contacting you this week?

  893. William Wallace

    I mean c’mon with this public not knowing or knowing about gold…for goodness sake every other commercial on TV is telling you buy gold! When the tech bubble was ready to burst my neighbors had no clue that tech stocks were even going crazy. There is a huge part of the public who does not care about what is going on in the market…you see that in reports today about people not even really having a clue about what is happening in the market. People are worried (because of what they hear on the news) and we see this is the low consumer sentiment…but retail sales are up anyway.

  894. Harry

    TZ, great insights. I’ve seen the same thing. My inbox is full of congratulatory emails for my past predictions but I’ve been responding by advising caution here.

  897. William Wallace

    I mentioned yesterday gold would be at 1750 by days end, 1760 by last night and then another smack down today…thats exactly what happened. If the market rallies again monday gold will catch another smack down, and then stumble to its feet again like a drunk… and it will keep getting smacked down until the market stops rallying. Take a look at a 5 minute chart in real time, right now gold is the drunk dude getting up again after being punched in the face. Dont you love my technical analysis? If the big selling is finished for today, which it seems to be..gold will grind back up to 1750-60..then monday if the market rallies it will be at 1720-1710

  898. William Wallace

    The real selling in gold is going to begin when the panic begins. Right now retail investors are still eyeballing $2500 thanks to the Bank targets, and buying dips just to get smacked down the next day.

  899. corporatewarrior

    Auger and David,

    Thanks for the input guys. I knew they were 3x leveraged. I wasn’t planning on trading with the options but buying “LEAP” type options with less than 5% exposure in my aggressive portfolio. I would “excercise” (not sell) the options if they became vastly profitable in the future.

    If it works out I make some money, if it doesn’t my exposure is limited to an experimental sector of my aggressive portfolio. It’s insane how much my portfolios are compartmentalized lol.

  900. MrMiyagi

    WW,
    Gold has gone up in the overseas markets after the smackdowns, just like silver did. I have very rarely seen downturns start in the Asian timeframe, just in London and NY times.

  905. ver

    Q’s also having a hell of a time pushing through resistance in the 53.5-53.8 region. Don’t like the idea of holding through the weekend one bit, especially if we’re predicating the bear rally on a dollar break lower. May be prudent to just wait to see what the dollar does.

  909. St. Deluise

    pretty ugly participation all day. seems to be a lot less commitment than at 3:45 yesterday.

    3pm close below spy 118 or above 119.22 to make any moves..

  912. DP

    MrMiyagi —

    On the premium blog you was recommended as an options expert.

    Are you aware of any web site which can plot Delta, Theta and Vega on the same graph with the underlying and its option prices?

    The reason I am asking — I am wondering about volatility which affects the option price during market bottom formation.

    In simple words, you can be right with the equity movement, but still lose with the option.

  913. aklaunch

    My last post i ment how SLV was trading perfectly inverse with the dollar…. OOoopps.

    I am going to hold to. I have a couple of Calls on the QQQ’s. They expire Sept 17th. I am starting to become fairly confident in QE3 if we have another devastating week or two. I have some put options on GLD and am not happy about it…. I will never,never,never,never,never short a bull market again.

  914. MrMiyagi

    DP,
    I’m not an expert by any means!
    On option-price you can find calculator for Delta as well as volatility.
    I haven’t seen any sites that chart them the way I think you want to see it but give this one a go.

  915. aklaunch

    My flawed reasoning was that GLD would do what SLV did…. Last night i had a moment of clarity and realized that GLD is not SLV. I think even if gold where to start coming off the parabola it will not puke itself out in a matter of days like its rotten little sister.

  917. rapper

    I had a few friends text me. people that I told months ago to buy some pm’s. also, gold is testing the support in the 30s and has dipped below. there is a lot of testing going on. last time it rocketed higher. this time? the bullish setups have been happening every thursday and friday for a while. could we see an old style mutual fund monday? stocks gap up and rip towards 1212, 1225. I really don’t want to hold anything over the weekend.

  918. DP

    MrMiyagi —

    What bothers me is not Delta, which behavior is at least qualitatively quite clear, but volatility affecting the option price.

    In other words, during the bottom formation, should you go with 2x and 3x ETF’s or DITM calls?

    I am sure houses have people who study those facts in detail.

  920. MrMiyagi

    DP,
    Personally, I never (ok… rarely ever, maybe twice FAS in ten years) go with multiple ETFs. I’d rather straight ETF or some options.
    Personal choice, there are some here that made lots of profit with AGQ earlier this year.

  921. notGreedIsGood

    would anyone know what is likely to happen if the SPY closes lower than the open today? i figure if it stays above tuesday’s close, then things should be OK???

  922. auger

    “3pm close below spy 118 or above 119.22 to make any moves..”

    St. Deluise, I’m not following, you’re in for a trade, at these levels?

  923. DP

    MrMiyagi —

    I like better options too, bit on several occasions I was losing money with them because the effect of price change due to volatility was opposite to the price move of the underlying.

    That piece of art is still a puzzle for me.

    BTW I jumped out of AGQ options when silver hit 46, because this “parabolic” (I hate this word, explain below) has limited life span.

    Let me tell you a bit about of my understanding of “parabolic” moves.

    Parabola is function t^2, which is not growing in logarithmic scale.

    What we observe during so-called “parabolic” moves, it’s the function that growing faster than linear in log scale, which means it’s growing faster than exponential.

    Are those functions known?

    Yes, they are. They called “blow-up” solutions in physics: 1/(t_0-t), where t_0 is the moment of time of singularity (infinite price) formation.

    One can even estimate time t_0 looking at the beginning of the growth.

    Such blow-up functions have limited life span until time t_0.

    That’s why I don’t have any problems with jumping out of blow-up tops.

    Sorry for math details, though some people finds them interesting.

  924. St. Deluise

    auggie, not in anything.

    spy’s been weak all day but i couldn’t guess to what that would mean come monday morning. 117.88 thereabouts now my bull/bear line.

  925. MrMiyagi

    DP,
    Very interesting math equations, I never even thought of it in that manner, always figured there’s math behind it but leaned more on the human emotion part and big-boys profit taking.
    Can you elaborate further or link up a webpage?

  931. auger

    STD, makes sense, thanks.

    RJ, the COT report includes last weeks data, so it’s pretty difficult to gauge where they stand, heading into next week. Something to consider, though.

  932. DP

    MrMiyagi —

    Those are just the analogies with what I see in my field — math physics.

    I am not sure that they will help you with improving the edge.

    I know some people trying to write equations in spirit “prey-preditor” models, but didn’t see they became rich of that.

    From another side, it seems to me that this sort of analysis might help to split the market behavior to different qualitative parts, or classify it.

    After that you can apply corresponding approaches to it.

    It seems to me that you are absolutely right that human emotion part and big-boys behavior are very important parts of the game.

    From another view, houses derive up to 50% of profits novadays from algo trading, that’s the part where math comes into the play.

    And finally, if I’m that smart, why I’m not that rich? 🙂

    Look at this, it’s about me:

    http://www.youtube.com/watch?v=O-C18dMFYLM

  933. RJ

    WW,

    http://cotstimer.blogspot.com/

    This guys thesis is to fade the large specs in gold. I was hoping the large specs would stay bullish this week so the signal would go to bearish.

    I’ll see over the weekend if it will still go bearish, but this move lowers the probability significantly.

    This means as of tuesday the large specs were already shorting and closing longs.

  934. MrMiyagi

    WW,
    My QQQ position wasn’t filled that one day but I bought in I think after the next down day. I didn’t go in at the time Gary called because I bought a bunch of Ford shares around 10.50$ and I sold half the next day.

  935. Gary

    The only thing I’ve found to be predictive is when the Blees rating gets above 95 then we should look for an intermediate bottom.

  937. Silverhound

    They were shorting Tuesday because they need the volume to sell into to establish large short positions. it’s commonly called “pump n dump” and it’s why I’m always suspect of large volume near the tops of rally’s. It doesn’t always reverse price immediately, sometimes momentum carries price a bit higher for a couple of days.

  938. William Wallace

    Gary,

    I have an important question to ask you, maybe you can answer it for me when you get a chance, when would be a good time to email you..I never emailed you before? I dont want to trouble you, so whenever your up to it..thanks my friend.

  940. William Wallace

    Gary,

    I got your email pertaining to subscribing to the aggressive portfolio, I will respond to that along with my question, so when you get a chance you can just reply.

  946. Beanie

    Sure, we could go lower on monday. Doesn’t matter, we should end the week higher.

    On a different note, I think all governments should put a permanent ban on shorting — senseless and not real world stuff.

    Go to the store and say “I’d like to short 3 packs of Pepsi please.” C’mon man, you might get kneed out the door.

  947. TZ(8155)

    GARY,

    >The market is being held back by the banks.

    FINALLY! I *knew* you would admit to the manipulation eventually. You stubborn old bastard you.
    🙂

  949. ckpc

    I’ve also noticed some “dumb money” type comments regarding gold lately which you would tend to see at a top.

    1.) I overheard a couple (mid 60’s) talking about going into the local coin store to buy some gold and they were astounded that the price was so much more expensive than the online spot price. Their conclusion was that the store was a “rip off,” because they didn’t understand that you pay a premium when you buy physical. I excused myself for butting in, and explained it to them.
    2.) Day before yesterday a young man wrote (on a political blog) that he was going to take his entire (few thousand dollar) savings and invest in gold ETF’s.
    He had been looking at GLD, SGOL and UGL and concluded that it was a “no-brainer” to go with UGL because it had “outperformed” the other two. He had no idea it was a leveraged fund, and he had been planning to jump in and buy UGL options here at the high. Hopefully he did not do that, as everyone was yelling, “NO! NO!” at him.

    I exited the Q’s today midday when the Nasdaq was up 30 points. That was good for 21% this week, and that’s fine for me. Despite the cycle confirmation, I just don’t feel comfortable being long the market right now with all the volatility. I know I’ll sleep better over the weekend this way.

    No disrespect to Gary.

    Good luck to all, and enjoy the weekend!

  950. auger

    Beanie, short selling has been a part of the markets, for centuries, so it is real world stuff. What do you think real estate, is all about? People borrow (from a bank) to sell (flip) a house and then purchase another, for a lower price, all the time.

  951. Gary

    TZ,
    That’s not what I meant. The BKX was red most of the day. The banking stocks have to participate for the rally to really take off.

  952. William Wallace

    Have a wonderful weekend everyone. Need to spend some time with the family, they are all standing here looking at me ready to tear me to pieces like a pack of wolves if I dont get up. Uh oh!

  953. David

    Beanie,

    You need to gain an understanding of how markets work.

    Once you do, you will learn that a modern economy requires the ability to make directional bets in order to manage risk. The futures market evolved in order to give farmers an insurance policy (puts) that would enable them to hedge market risk. Every major multinational corporation requires the ability to hedge risk in currencies and commodities. What you are talking about would destabilize the global economy.

    You have demonstrated that you don’t even understand basic principles. You simply aren’t worth taking seriously.

  954. DG

    Beanie—you wrote:

    On a different note, I think all governments should put a permanent ban on shorting — senseless and not real world stuff.
    Go to the store and say “I’d like to short 3 packs of Pepsi please.” C’mon man, you might get kneed out the door.”

    Good Lord! Please tell me that was a joke! Do you actually not understand what “shorting” is? After all the writing you have done I find this incredible!

  956. Bob loves Hawaii

    For the first time in years I have gone nearly flat in my entire portfolio.

    I closed my GLD longs and their hedges today, as well. I have just a small SPY call spread and my MLP dividend stocks.

    GLD is not breaking down like I thought it would, silver is holding up as well, but the miners are acting like scalded dogs; flipping from buy signals to fake outs.

    This leaves me to conclude that gold still will fall but not in the sell and go away camp just yet. I think we get our parabolic move yet, soon.

    Gary remember when silver was going parabolic, it was understood we could get a fake out breakdown and then the final burst higher, a third DCL instead of the collapse we got instead.

    I wonder if that is what we can expect here.

  957. fubsy_cooter

    Holding my meager positions in sso and ZSL through the wknd. Deferring to cycles, sentiment, and managing risk via small position size. I hear a lot of fear out there around Europe dropping some financial bombshell, which it likely will. I just don’t think its gonna move the market anymore. It’s uncertainty or unexpected newd that causes markets to drop. This is now all familiar. My bet is we rise in the face of bad news for a few weeks. It may be volatile, but I believe it will be up.

    Nonetheless, I’m very light for now. I think that’s typical if most traders at this time, another reason I believe the market has room to run upwards. If bad news loses it’d shock factor, its good news that will come as a sunrise.

    Have a good weekend folks.

  958. Gary

    Bob,
    I’m not completely convinced of this yet, but I suspect gold is going to enter a very deceptive D-Wave decline that could drop $500 over the next month and a half to two months.

    Look at what just happened. For the last 2 1/2 years, gold has been climbing a wall of worry moving $5-$10 at a time. All of a sudden we start getting 40, 50, 60, and $80 moves. For heavens sake gold rose over $200 in 14 days.

    After a 2 1/2 year C-wave, that kind of change in character isn’t the beginning of something. It is the end of something.

    On top of that the Fed took away the fuel that was driving this move. I like everyone else expected Bernanke to announce QE3 on Tuesday. When he didn’t do it, in my opinion, that was a game changer.

    I’m confident we are going to see QE3 but it is apparently going to come with the stock market at much lower levels.

  961. MarkMarin

    Someone asked about people suddenly inquiring about gold. I did get email asking for a gold name on Tuesday. I gave him the Qs for a swing trade and said he should wait on buying a gold miner. He about fell out of his chair, but didn’t buy the Qs or a gold stock, so it’s a partial win.

    On another note, the U of Michigan consumer sentiment readings were the 3rd lowest since 1952. Sentiment Trader’s statistical analysis of stock performance after Lowest readings, shows a median gain of 10.9% after 3 months and 19.4% after 6 months. Any random time performance has been 1.9% after 3 months and 4% after 7 months, so statistically significant.

    Good luck everyone.

  962. Feel

    “I like everyone else expected Bernanke to announce QE3 on Tuesday. When he didn’t do it, in my opinion, that was a game changer.

    I’m confident we are going to see QE3 but it is apparently going to come with the stock market at much lower levels.”

    Gary,

    Been lurking a while. Didn’t realize you had pinned it down to this week’s meeting. I thought you along with others who anticipate a QE3 are expecting it at the Jax Hole get together. My understanding is that’s on the 26th…

    I’m cloudy on how it was rolled out last year (QE2). IIRC, it was revealed in Jax Hole but officially /publically initiated Oct./Nov. ???

  963. Gary

    Bernanke had his opportunity last week with the market crumbling all around us and he stood his ground.

    In my opinion that was a game changer, at least temporarily.

  964. Hack

    aklaunch – I made around 15 trades this week and am now 70% long. Two trades returned over 9% in just three days. Another is at 16%

  965. Feel

    The market (and I mean SPX, not gold) started selling off gradually but consistently the last week of July. Down five days in a row & 51 pts. that week. First week of Aug. down four days and 92 pts.

    Monday 8th down 79 pts.

    FOMC was a roller coaster ending up 53. Of course that got peeled off on Wed. Then put back on yesterday.

    This all looks to fit well with the idea posed by some of the fed needing a purpose/cover story or whatever.

    Their “opportunity” grows,right?

    Also, I think we’re in the window of time where the front-running of the news/decision re: QE3 should be taking place if it’s gonna…this would be about the time for that nugget of info to get leaked so it can be acted upon before the 26th.

  966. Gary

    The market should be rallying pretty strongly by then.

    I really doubt this is going to play out the same as last year. And I really doubt gold is just going to keep going up and up forever like so many want to believe.

    There has to be a profit taking event after a 2 1/2 year C-wave. If there isn’t then the public will come in too soon and the bull will be over.

  967. Feel

    P.S.

    I am not expecting QE3. I’m also not NOT expecting it.

    I don’t know what they will decide or what they would like. I DO think that if they initiate it they would like the cover of an SPX closer to 1000 than 1400.

  969. Silverhound

    slumdog

    Last week you initiated a discussion about historical chart patterns and suggested we were at July 1929, using the 1929 DOW crash as a road map. Here is a copy of the chart for that year. I was wondering what you saw in the chart to indicate another crash coming rather than a slow grind like the market saw down into 1932?

    INDU 1929

  970. Beanie

    The ability to short the way we’re able to do now (and now we can leverage our shorts in a big way) is highly destructive to the markets, especially during times of economic stress. We have seen that already with Lehman and many of the banks. These institutions typically hold lots of debt. If they lose excess to credit, as result of fast and endless plunging prices, they could all go belly up rather quickly. Attack the financials and you can bring the entire economic system down to its knees. You basically destroy the game, when you short financials to oblivion. That’s why the Fed had to step in. (The fed won’t be able to step in on the next big stress to financials.)

    Unfortunately, 2008 is not the worst. The worst is in the future, probably a decade from now.

    We use to have the Uptick Rule, enacted in the 1930’s, that helped protect the market from massive bear attacks. It was a reliable rule, and for some reason we got rid of that rule in July 2007. (Somebody obviously wanted to pile drive the markets.)

    And for the psychos that don’t think I know anything about how the markets work because I’m against shorting, please think about why the govt had the Uptick Rule in the first place.

    Publicly, Warren Buffett had said that shorts helps the bulls, but in reality I don’t think he truly believes that (at least with the ability for shorties to leverage their shorts these days). Why didn’t he ever forward split BRKA? It’s because he wanted to prevent daytraders and shorties from touching the stock.

    Really think about why the Uptick Rule was with us for 80 years. And what happened when it was removed in July 2007.

  971. Gary

    If we had just let the insolvent banks go bankrupt 3 years ago we wouldn’t be in the mess we’re in now. Sure it would have been incredibly painful, but it would be over and done with and we would now be coming out the other side by now.

    Instead we have piled trillions of dollars of debt onto the American taxpayers back. Debt that we’ll never be able to service other than through monetization which is really just a hidden tax on all of us.

    Banks have been going bankrupt for centuries. It’s never been the end of the world and it wouldn’t have been this time either.

    The solvent banks, the ones that didn’t make stupid mistakes, would have taken over the assets of the insolvent banks and the system would have rebuilt from a sound base.

    We’ve chosen to repeat the Japanese mistake because it’s the easiest path to re-election.

  972. Ben

    I didn’t expect QE3 this week, nor later this month. I expect it around early October. I don’t think there’s political cover for the failed QE policy until there’s panic, and the ship righted far too soon. And if the ship had not righted, QE would not be effective directly on the heels on the QE1/2. The public needs to disassociate QE from the mess they’ve helped to magnify and perpetuate.

  973. David

    Beanie,

    Lehman didn’t go under because people were shorting its stock. It went under because it was bankrupt. It filed for bankruptcy.

    Try getting all your friends together and shorting a solvent company, like Procter and Gamble. No amount of short-selling could make Procter go under. It could temporarily move it’s share price, but that has nothing to do with it’s viability as a business. Eventually the share price would return to its market level and the shorts would be forced to cover.

    The only exception to this would be something like Enron, where the corporation had used it’s own stock as collateral in a de facto ponzi scheme.

    Once again, you’ve demonstrated that you don’t understand the basics. The share price of a company does not affect a company’s solvency or viability. You are confusing stocks with the companies themselves.

  974. Greenspansconscience

    Do a youtube search for “khan academy is short selling bad.”

    This guy is a math genius and lays out a case for why shorting is healthy for markets. Of course “naked” shorting is a totally different story…

  976. DP

    Ocean,

    I don’t know if that’s right nick for the open blog, but I appreciate your desire to share the information and continued discussion on the volatility influence on options pricing.

    So, you are basically saying that Vega (volatility) is generally maximized at market troughs and minimized at market bottoms.

    That’s unlucky, ’cause according to Gary’s approach we are sort of disadvantaged at the tops — i.e. unable to detect cycle tops, not selling bear markets etc.

    To the contrary, at the market troughs, when we are able to detect cycle lows with high probability, Vega is high and troughs are not good for buying calls.

    That’s sad, ’cause it means we can’t leverage buying with the options at bottoms having good risk/reward ratio.

    What I am thinking, if we can do a more complex money management at the troughs, like start buying with futures or leveraged ETF’s, and when market starts running and volatility reduces, switch to the options?

    BTW, does the ‘volatility smile’ say you anything?

  977. Beanie

    David,

    The reason most bears don’t understand this is because they treat the market like a casino. As such, they want things to be fair. They want to be able to short at will, anytime, anywhere, anyhow. They even want the uptick rule to be gone forever. As such, they are generally clueless what the stock market is about and how it functions.

    Bullish investors, on the other hand, treat the market as an investment. They make an investment in a company’s stock in hopes of gaining a positive return for the risk they take. They are taking the risk in supplying their money to the cash equities market so companies can borrow money to grow their business. They are in essence doing a good thing for the companies and for America. Yes, shorts take risk too but the kind of risk is quite different.

    With investors’ help, individual companies can access the capital markets and efficiently raise risk capital to grow their business, or borrow money if they run into temporary problems. So the onus should be put on the short sellers. Investors should be more protected than short sellers because investors provide a very important function to the market place. the uptick rule helps make the marketplace process more efficient.

    My friend, you may think PG is safe but I can assure you that one of these days if they don’t have access to cash equities market due to huge and fast plunging stock market prices, the company can go belly up. Most companies have some form of debt and need working capital that is borrowed. Note that PG has 32 billion in debt: http://finance.yahoo.com/q/ks?s=PG+Key+Statistics . Could PG go bankrupt if stock market plunges 90% and stays there for awhile? You bet PG can go bankrupt, similar to Lehman. The question then becomes, “Will the govt or anybody step in and save Proctor & Gamble if the company couldn’t borrow enough for working capital?”

    The truth is, Lehman could have survived had the credit markets not froze on them. There was so much fear (as result of massive and fast decline of stock prices everywhere) that no one would extend them credit (or, as the case may be, they weren’t extended sufficient credit.

    This is how a great company could go belly up (not so much because nobody wants to buy their products but because of a freeze in working capital), and in short fashion. It is very important the govt at the very least reinstates the uptick rule.

    Sure puts some light on short selling, doesn’t it? Perhaps you may want to study what is the function of the stock market, no? That’s why I always say that bears are like cancers –a bit harsh I know. It’s just that sometimes they destroy everything around them without understanding the consequences fully.

  981. Shalom Bernanke

    Eamonn,

    I explained that earlier on Friday in the comments here. Not much more to it than what I mentioned. Keep it simple.

    As far as diversification, studies show there is not any benefit to the investor in owning more than 7-8 stocks. I own less right now, but won’t ever hold more than 8 for sure.

    Beano,

    You do realize both Lehman and PG tested your hypothesis in 2008-09? One vaporized, the other continues to make billions of $/yr.

  983. DP

    W2 —

    William Wallace said…

    “DP,

    So how do those math equations come into play when a parabola collapses…to me its all just emotion like Miyagi said”

    It’s a prey-preditor model, math speaking.

    Foxes population grows till last rabbit is alive. Then it starts to die.

  984. Frank

    Re P&G, the company has EBITDA of around $20 billion. And their debt is only $32 billion. Risk of bankruptcy? Are you kidding? The company is rated Aa3 for good reason.

    If a company like that dropped by 40-50% then it would go private quickly. It only dropped to the high 40s in March 2008 and it actually held up well during the “liquidity crisis”.

  985. tom

    GOLD’S D WAVE-I feel gold’s D-WAVE will be more of a slow grind sideways with maybe a $1500 downside.This is due to the fact its a small market and with all the money floating around looking for a place to park that enough of that money will keep gold afloat.With central banks buying and the new middle class of Asia and the Middle East moving money to gold also EURO problems.This is why I feel Gold stocks will play catch up going forward and offer a better return than the physical near term.Good Luck HOGWALL

  986. Gary

    Tom,
    I’ve never seen a D-Wave yet they grind sideways. A consolidation can grind sideways followed by another move higher. But a D-Wave is a profit-taking event that starts to feed on itself as more and more traders that bought at the top panic.

    Depending on how far the parabolic move stretched above the 200 day average, they almost always drop back down to the 200 and often move a bit below it.

  987. Slumdog

    What is the number gold’s at for its current 200 DMA?

    Thx for hosting this blog, and its commentary.

    (As an aside, IMO, the DJIA will return close to 12000 in the next 2 days. After that, no pattern recognized.)

  995. David Kafrick

    David,

    Beanie does have a point here. The share price of a company does affect a company’s solvency or viability.

    It is a mistake to think that the fundamentals of a company affect its share price but that its share price does not affect the company’s fundamentals. It does!

    George Soros wrote a very good book called The Alchemy of Finance, where he presents his theory of reflexivity, which is exactly about how this is a symbiotic relationship. Real world businesses affects market prices and market prices affect real world businesses.

    That being said, I am against banning short selling simply because I believe it does more bad than good.

  996. tom

    GARY D WAVE well Gold’s 200dma is $1458 and rising and should be near $1500 by the end of the month.Overall were only talking $200-$300 downside which I don’t feel is a severe D-wave correction.Now if Gold gets 40% above its 200dma($2000+) we would have much more room to drop and that just might be where the C wave takes us but for now gold’s resting and the next move is unclear.One margin hike shouldn’t derail Gold and as of yet I can’t call Gold’s recent rise parabolic yet.Lets face it we have to play the cards were dealt as were not the dealer.Keep up the good work as you are better than avg at what you do.HOGWALL

  999. Blindweb

    George Soros also owns large swaths of land in South America. While I have no problem with it, I suspect it is directly contrary to values of the people at Media Matters which he funds.

  1000. David Kafrick

    SB,

    That’s irrelevant, and has nothing to do with the fact that his ideas about finance and economy has any merit or truth to it. But since I know you are a fan of Glenn Beck you probably don’t like Soros. 🙂

    Anyway, I would say that he knows a thing or two about finance. Also, there are many other successful trades/investors and economists who do agree that the movement of a company’s share price can indeed affect its business.

  1001. Shalom Bernanke

    Actually, Glenn Beck is a schlepp intended to misdirect the “thinkers”, IMO.

    If Soros teaches anything, it’s that cheating pays. Although all the facts are not in on the recent downgrade of US debt, somebody bet almost $1 billion dollars in a 10:1 bet against treasuries not long before, and it’s quite possible it was Soros. We shall see, but it is odd he returned investor money only 2 weeks before, meaning less reporting requirements.

    Old habits die hard.

  1002. Shalom Bernanke

    And if you think Soros didn’t have prior knowledge of the downgrade you’re a fool. Whether he made the bet or not we cannot know for sure (yet), but he did play a major role in getting Obama elected.

    Not only a big contributor to Obama’s campaign, but also the funds behind Move On.org

    Criminals don’t put money behind something unless it pays out, in my experience.

  1003. Feel

    A few posts for those interested in the subject of “bans” on shorting based on 2008 experiences.

    Let’s clarify some of the basics that transpired in ’08 regarding bans on short selling. I say “basics” because this subject can get technical pretty quick. The important distinction to keep in mind is “short selling” as opposed to “naked short selling”.
    Let’s pick mid-Summer 2008 as the starting point.
    They (the SEC) first instituted a “ban” on naked shorting in about 19 securities for 1 week. This means you had to cease naked shorting in these issues for 1 week. If you could get a borrow (like all average/normal/regular traders are required to do anyway) then you could still short!
    http://www.sec.gov/news/press/2008/2008-143.htm
    ________________________________________________________________
    July 15, 2008
    The Securities and Exchange Commission today issued an emergency order to enhance investor protections against “naked” short selling in the securities of Fannie Mae, Freddie Mac, and primary dealers at commercial and investment banks.
    The SEC’s order will require that anyone effecting a short sale in these securities arrange beforehand to borrow the securities and deliver them at settlement. The order will take effect at 12:01 a.m. ET on Monday, July 21. In addition to this emergency order, the SEC will undertake a rulemaking to address these issues across the entire market.
    “The SEC’s mission to protect investors, maintain orderly markets, and promote capital formation is more important now than it has ever been,” said SEC Chairman Christopher Cox. “Today’s Commission action aims to stop unlawful manipulation through ‘naked’ short selling that threatens the stability of financial institutions. We will continue our vigorous commitment to investors by working within the SEC and in close cooperation with our regulatory counterparts to promote the continued health and vibrancy of our markets.”
    The Commission’s emergency order, pursuant to its authority under Section 12(k)(2) of the Securities Exchange Act of 1934, will be effective at 12:01 a.m. ET on July 21, 2008 and will terminate at 11:59 p.m. ET on July 29, 2008. The Commission may extend the order to continue it in effect thereafter if the Commission determines that the continuation of the order is necessary in the public interest and for the protection of investors, but for no more than 30 calendar days in total duration.
    The securities identified in the Commission’s order:
    BNP Paribas Securities Corp. BNPQF or BNPQY
    Bank of America Corporation BAC
    Barclays PLC BCS
    Citigroup Inc. C
    Credit Suisse Group CS
    Daiwa Securities Group Inc. DSECY
    Deutsche Bank Group AG DB
    Allianz SE AZ
    Goldman, Sachs Group Inc GS
    Royal Bank ADS RBS
    HSBC Holdings PLC ADS HBC and HSI
    J. P. Morgan Chase & Co. JPM
    Lehman Brothers Holdings Inc. LEH
    Merrill Lynch & Co., Inc. MER
    Mizuho Financial Group, Inc. MFG
    Morgan Stanley MS
    UBS AG UBS
    Freddie Mac FRE
    Fannie Mae FNM

  1004. Feel

    A week later when the first “ban” was set to expire they extended it for a second 10 day period. Again, directed towards naked short selling and not what they call “legitimate short selling”.

    http://www.sec.gov/news/press/2008/2008-155.htm

    *****

    July 29, 2008 — The Securities and Exchange Commission today extended an order issued July 15 to enhance investor protections against naked short selling in the securities of financial institutions to which the Federal Reserve has granted temporary access to liquidity facilities on an emergency basis. The extended order will be in effect until 11:59 p.m. EDT on Aug. 12, 2008, and will not be further extended……….
    The purpose of the rulemaking is to provide additional protections against abusive naked short selling in the broader market, while allowing the legitimate short selling essential to efficient, highly liquid markets……….

  1006. David Kafrick

    SB,

    I won’t argue with you about George Soros, I was talking about his ideas, which by the way are shared by many other important investors.

    I only mentioned Soros because he had something to say about market prices not affecting the company’s business, and wether that is true or not has nothing to do with what he does in his private and professional life.

    Next time I will mention someone who is not a foreigner, maybe someone from the Tea Party, then perhaps you won’t feel the need to attack the person and instead can debate the idea itself.

  1007. Feel

    In mid-Sept. ’08 when the market began waterfalling they expanded the “ban” to ALL companies. This was in effect from Sept. 18th thru Oct. 1, ’08
    But again, ONLY TOWARDS NAKED SHORT SELLING.
    If you could get a borrow (part of legitimate shorting) then you could short.
    Do you know how hard it was to get a borrow at that time? I do!

    http://www.sec.gov/news/press/2008/2008-204.htm

    http://www.sec.gov/news/press/2008/2008-209.htm

    ***********************************

    Sept. 17, 2008 — The Securities and Exchange Commission today took several coordinated actions to strengthen investor protections against “naked” short selling. The Commission’s actions will apply to the securities of all public companies, including all companies in the financial sector. The actions are effective at 12:01 a.m. ET on Thursday, Sept. 18, 2008……

  1008. Feel

    Finally, just a few days later when things got REAL bad in the market they joined hands with the Brit’s FSA and banned ALL shorting (naked & legit) but ONLY in 799 *financial* companies.
    Originally this was to expire Oct. 2, 2008 buton Oct. 1 it was extended to Oct. 17th.

    Then, just a few days later, those who are used to naked shorting cryed foul and got the SEC to create a loophole just for them.

    *******************************

    http://www.sec.gov/news/press/2008/2008-211.htm
    http://www.sec.gov/news/press/2008/2008-218.htm
    http://www.sec.gov/news/press/2008/2008-235.htm

    Sept. 19, 2008 — The Securities and Exchange Commission, acting in concert with the U.K. Financial Services Authority, took temporary emergency action to prohibit short selling in financial companies to protect the integrity and quality of the securities market and strengthen investor confidence. The U.K. FSA took similar action yesterday.

    Sept. 21, 2008 — The Securities and Exchange Commission’s Division of Trading and Markets today issued the following statement:
    The Commission has approved technical amendments to the Emergency Order banning short selling in financial stocks. The technical amendments were made to ensure the continued smooth operation of orderly markets, and to coordinate to the extent possible with similar actions restricting short sales by foreign regulators.
    The technical amendments keep in place the exception contained in the original order for short selling related directly to bona fide market making in derivatives, including over-the-counter swaps, in the securities of any Included Financial Firm. However, this exception now requires that, for new positions, a market maker may not sell short if the market maker knows a customer or counterparty is increasing an economic net short position in the shares of the Included Financial Firm.

  1009. Shalom Bernanke

    David Kafrick,

    It’s not a personal attack on Soros, I only stated the FACT he’s a convicted felon in the same business we’re involved in.

    If so many others agree with his opinions on finance, as you argue, perhaps it’d be better to use their names?

    Or are they among the brainwashed idiots, and not worth mentioning?

    Have the last go at it, I’ve shared the facts, and people can draw their own conclusions. Quoting felons is not the best way to bolster your argument, unless talking with the misinformed.

    Perhaps you should start with “although Soros is a proven thief, he has some good ideas…..”

    At least it’d be accurate.

  1011. SF Giants Fan

    Someone mentioned about the margin change to gold contracts. 22% increase but it is still small as compared to total contract cost compared to silver.

    Current margin req for gold is about 4.3% and silver is 11% of currnent contract price.

    So my guess is there are more gold margin increases to come.

Comments are closed.