PRIMED FOR A TREND REVERSAL

“Liquidity will eventually find its way into undervalued assets” Gary Savage

I think it’s time for liquidity to drain out of gold and flow back into a severely beaten up stock market. Depending on how quickly the market tests the 200 day moving average will likely determine whether or not it can make marginal new highs before resuming the cyclical (and secular) bear trend.

More in the weekend report…

719 thoughts on “PRIMED FOR A TREND REVERSAL

  1. TommyD

    Oh, so the DOT is just a game to see who’s the first to post???

    I thought it was utter acceptance of the lunar full moon cycle and the affects upon the tides, crime and mental disturbances throughout the planet unbenonced to all, which can cause people to act opposite one’s normal thoughts and behavior, thus prompting a “DOT” to form in lieu of commas or exclamation marks, not to be confused with skid marks that one should never question…

  2. ...at ease

    Tommy D.
    “.” is used as there were complaints on using other words or something like “BEEP” to be able to check the box to follow new comments posts from Gary.

  3. Gary

    Other than QE stretching the stock market daily cycles a bit they seem to be coming pretty much right on time.

    It appears the intermediate cycle has bottomed on week 21. The average is 22.

    What makes you think that HFT is having any effect what so ever on cycles?

    It’s just day trading on steroids but still just day trading. When has day trading ever deflected the cyclical or intermediate trend?

  4. Gary

    HFT is just another excuse some people use for why the market didn’t do what they wanted it to do.

    Mark my words, just as soon as gold enters a D-wave decline the conspiracy wackos will blow a gasket.

    All the scam artists (like GATA) will claim that’s why gold didn’t get to $2000 or $2500 or what ever price they guaranteed will be hit by the end of the year.

    Then they will conveniently not have to take responsibility for getting all their followers caught in a $500 point correction.

  5. SF Giants Fan

    Gary

    “What makes you think that HFT is having any effect what so ever on cycles? “

    Im not here to poke holes in cycle theory or questioning your ability but what I’m suggesting is the possibility when 75% of volume is HFT that human emotion is not entirely in the control.
    I guess I’m on the lookout for curve balls (not excuses) and wanted to run it by you for you thoughts.

  6. SF Giants Fan

    Gary

    Thx

    Oh yea it was good to deploy the $ I had removed from the market in April / may. While everybody at work was boo hooing about their 401k last week, when asked how mine was doing, I said “fine I’m all cash but I’m buying today”.

  7. sapient1

    Alex

    If you’re around over the weekend (unlikely I know) I’ve got a question for you.

    Thanks for those charts you posted of the bullish breakout patterns many of the miners have been tracing. But I wonder if you’re concerned about what a potential correction in gold might do to the miners’ prospects.

    Personally, even though Gary’s made a compelling case for a major correction down the line, I’m still fairly confident that any correction at this stage in gold will be just a wave 4 pullback, and that there’s still a wave 5 to come. This is based on the breakpointtrades (which I subscribe to) charts and indicators, which show a convincing looking impulsive wave count, as well as the fact that on Wednesday the miners rose strongly while the rest of the market tanked.

    Thanks.

  8. JG

    blindweb, what kind of service does Janszen offer, is it a monthly report? Is it worth subscribing to?
    He made alot of sense with that article rebutting Mish, I certainly agree he tore Mish a new one!

  9. St. Deluise

    i’d feel a lot more “in tune” with the market if last tuesday’s wick is threatened in a meaningful way because as of now it’s thrown my system a curveball. regardless of my gut i’m going to try scaling in again on any weakness early in the week.

  10. jeff

    Great article from Janzen and this is what he is saying in English.
    1. With fiat money, we cannot have long term deflation (short term may occur) as the US had under the gold standard in the 30s because the government will “print” to produce inflation
    2. Inflation is a function of both price (i.e. supply shocks) and money supply (currency depreciation) and the the primary cause of inflation can only be observed after the fact over the long term
    3. He distinguishes debt deflation (consumers paying down debts and not taking on new debts) from deflation (sustained GDP contraction) and explains how the government is now spending ( printing money) to cover the short fall in GDP. That is the government is printing to compensate for the decrease in consumer spending (and drop in consumer debt).
    4. Gold is rising because of government deficit spending (printing money).
    5. The consumer debt deflation is overriding price inflation at the current time (this why CPI is low, housing is a large percentage of CPI)
    6. The consumer debt deflation and government printing response implies lower stocks/house assets prices AND higher food and commodity prices and (wages eventually).

  11. Le Fou

    Mentoring question for Gary

    Everyone welcome to respond as well.

    Do you use a financial news website as your home page? If so, which one? How often is it updated?

    What are the websites that you visit everyday? What are others that you find most helpful?

    Aside from SMT, SMTP and THE DOCument, I visit Bloomberg.com, Zerohedge, TSI Trader, Marc Faber, & Naked Capitalism.

    Do you subscribe to WSJ Online? Is it worth subscribing to?

    Anything else you do to keep up with the world of business, finance and investing?

    Appreciate any feedback,
    Le Fou

  12. Gary

    I mostly avoid the news. The news almost always seems to fit into the cycle count anyway.

    I also try to avoid other analysts because I find it influences my decision making process, especially when things are exceptionally volatile.

    Like everyone else when the market is going crazy I have a tendency to look for someone “who knows what’s going on”.

    The truth is, that during those periods everyone gets lost and I’m better off just trusting my own judgment.

    I look for turning points on major economic data releases or Fed meetings. But other than that most of the news is irrelevant to the market.

  13. Le Fou

    Thanks Gary,

    So you know what’s going on in “the markets” because you have data on them that you work on regularly?

    For example, you plan at some point on investing in Biotech. Do you have charts ongoing charts in SmartCharts which allow you to make decisions about those markets? Or do you use some other resources?

    Le Fou

  14. Beksachi

    A SIGN! Dollar will go up.

    Was at gymn and was watching that silly “Kardashian” reality show.

    The husband was confronting his 2 teenage daughters for stealing his credit card and going shopping for second time.

    He says he wants them to learn value of $, when one of them talks back with “Value of $ is falling..”.

    When the movie “2012” came out in November 2009 and I understand there was a quip in it about the $ falling, the $ went on to rise dramatically.

    (BTW: when nauseating shows like “the Kardashians” get pulled off air, that will be a sign we are beginning to fix this generational mess”)

  15. JEFFtheFLEA

    (BTW: when nauseating shows like “the Kardashians” get pulled off air, that will be a sign we are beginning to fix this generational mess”)

    if they get pulled, it will mean they have 2 to replace them. ( ive never seen it though)

  16. JEFFtheFLEA

    the news has a new meaning to me since i found gary. The brokers just say ” well they will sell the news or buy the news and sometimes it does not seem to have any reasoning as to the direction. i.e. bad report markets go up. well i have learned from gary that when it is cycle time it doesnt matter what the news is, the cycle just needs a trigger to do what it was due to do.
    its amazing to me

  17. Russell

    If your not sufficiently scared of being caught in a D wave, read John’s latest in TSI trader. I got the same feeling about swimming in the ocean after the movie Jaws was released.

  18. Gary

    Beksacki,
    I watched the movie Cowboys and Aliens the other day. Take a guess what the aliens were after on earth.

    I’ll give you a hint. It’s shiny and yellow.

  19. Coffee

    I have trouble watching the Kardashians reality show which is probably one of the most stark examples of conspicuous consumption.
    Five minutes is about all that I can take.

  20. Veronica

    My system will sell at 1725, not having moved up substantially since Friday’s sell point. I would have to think the correction will move forward in earnest when the sell point is hit.

  21. aklaunch

    The Bulls and the Bears are having a good fight with Gold overseas at the moment. I almost feel like a nice sharp spike new high could fit the bill before a good sized correction? Going to be a great week to see how this all plays out.

  22. 86d4life

    And the aliens left the Rothschilds here to store up the booty so it`s ready to go for the next trip. I wonder if they`re still using fossil fuels to propel their ships. Maybe they`re using some kind of alternative/solar energy source. Hey, wait. You guys don`t think maybe…..Beano? Do you guys think he drove them bonkers too and they exiled him to earth?

  23. Robert Thrane

    I’ve seen the aliens trading website blacklist. Aliens are prohibited from visiting Beanie’s site because so many before have lost their money. Slope of Hope was number one on the list.

  24. Beanie

    “Bear charts” don’t work in bull markets. We will bounce, and eventually make new highs, not go to bear market.

    Bull markets usually end with euphoria — 2000 Internet euphoria, 2007 housing euphoria. There is no euphoria in 2011, only gloom and doom.

    Folks, it’s time to buy stocks, for the next 5-7 years.

  25. Gary

    I’ll buy stocks in the fall of 2012 at the next 4 year cycle low but for now this will just be a typical bear market rally even though it might possibly make a marginal new high (if it can get back to the 200 DMA in the next two weeks).

  26. Gary

    Boy if that doesn’t say “major top” I don’t know what does. All those late comers need to get wiped out by a D-wave, then the bull can continue higher.

  27. Éamonn

    Gary, thanks to you I will not be wiped out. Its just the kind of thing I would have done a year ago – buying tops and selling bottoms. I’m sure glad I have wisened up. And I would not like to be a buy & hold investor of stocks either. They have got their ass handed to them. Its sad to think of all the money they worked hard to invest

  28. Beanie

    Eamon,

    Not sure what you mean buy that. Buy and holders would be crazy not to snatch up bargains of 2008 and 2009. True buy-n-holders always buy (more) stocks when there is blood in the streets. Many have made out extremely well. Now there is a difference between your typical public investor (like your aunt or schmoe joe who only buys during euphoria) vs. the smart buy-n-holding investors.

  29. KAL

    Yeah, sad people have been paying more than $1900 for an ounce on eBay thinking they are smarter than everyone else.

  30. Éamonn

    Beanie, I don’t think now is the time to buy stocks, IMO. I will buy stocks when they have reached their full lows, just like when I would buy any other asset. But I think the signs are ominous that the world economy is stalling with parts already in recession, and thus it is likely we will see new lows. Maybe the Fed will come with a whopper QE and then I will jump in with call options.
    btw Beanie, I don’t think its fair that people sometimes deride you here because you have a contrary opinion. I enjoy hearing your opinion, but at the moment I would not agree with it.
    I feel this is a good article: http://www.financialsense.com/contributors/chris-puplava/2011/08/12/economic-indicators-show-us-recession-as-early-as-next-month

  31. Éamonn

    KAL, I agree with you, very sad. Those are the people who really cannot afford to lose money, and they will get eaten alive, because they will sell at the bottom

  32. KAL

    Eamonn,

    Hey buddy. How’s Eire?

    Maybe if the gold buyers figure they’re just early for the party, they’ll bury the gold until the real blow off top comes. But, you’re probably right. They’ll panic and sell, and since it’s physical they’ll get less than spot, just like they paid more than spot when they bought in.

  33. Gary

    When you look at that long term chart you really get a good idea just how stretched gold got at what I presume will be the C-wave top.

  34. Beanie

    Eamonn,

    Whoever wrote that article I’m sure have been writing articles like that for a very very long time. I would short it and I would short the guy.

    I think too many people are making things way too complicated than it really is. Also, too many people get too complicated with (or hide behind) charts when the answer is already right in front of them.

    I’m reminded of the Great Warren Buffett who always say to buy on fear and sell on greed. Sounds simple enough but so few take advantage of this tried-and-true wisdom of the stock market.

    We had doom and gloom talk all of 2009, 2010, 2011 since this bull market began. Now the bull market just hit another bump and everybody is calling for the resumption (or start of) a bear market. Bull markets never end with fear. Never. It always end with euphoria/greed.

    I’d go with the simple.

  35. Éamonn

    Beanie, I agree with you “buy on fear and sell on greed”. However, I believe there is more damage to come, down to S&P at 1000. Then, I believe the Federal Reserve will put a floor under the market with more policy support. At that point I will buy. But not now

  36. Beanie

    Sure, Gary, gold is in a secular bull market I don’t deny that. But it’s not something you can ride on for a few decades like great stocks. Eventually you have to get off before the whole thing gets blown to pieces. There is no way to measure what gold is worth, other than another guy is willing to bid it up. I hardly call that a great investment you can pass on to your kids. As such, it sounds so much like tulips and ponzis.

  37. Gary

    Beanie,
    The problem with that theory is if they get caught in bear markets, like you have a tendency to do, then they have no money to buy at the bottom because they rode the wave all the way down. They are forced to sell at the bottom or risk insolvency.

    You got caught in the last bear market and now you are caught in current bear market.

    You will get your chance to unload stocks during the impending bear market rally but your permabull mentality will prevent you from selling.

    I got everyone out and avoided this entire mess. You on the other hand are going to take everyone down with you because you can’t seem to comprehend the meaning of a secular bear market.

  38. Gary

    Actually it’s very easy to value gold. Once we get rid of Bernanke and get someone in charge of the Fed that is willing to make the hard choices and turn off the printing presses then the gold bull will be finished.

    We will also see a Dow:gold ratio of 1:1 or less before this tops. At the recent top it had dropped to 6.2:1.

    I suspect that it will move down a bit more as the Dow drops down into the 2012 four year cycle low. Gold should just consolidate in a high range between $1300 and $1800.

    If the Dow drops back down to 7000ish and gold hangs around $1500ish that would drop the ratio down to about 4.5:1.

  39. Bob loves Hawaii

    Beanie, I put my entire net worth in the stock market in 1998, it is at the same value today, but everything I buy costs more than double. I am a buy and hold investor, what should I do?

    Sarcasm off. LOL

    You must be a caricature.

  40. Beanie

    gary,

    It’s just wrong to assume that buy-n-holders or bull traders never sell stocks. There are times to sell (either thru valuations or technicals or sentiments or forced) but they all know when it’s time to put money (new or cash from sold stocks) to work and snatch up stocks and it’s usually when everybody is extremely fearful.

    Even Buffett himself, sell stocks on a quarterly basis (not sure if he day trades or swing trades) as you can see at gurufocus.com . Smart bulls are not as stupid as bears seem to think. And no, bulls do not buy and hold stocks for ever.

  41. Gary

    Beanie,
    I’m not a bull or a bear. I sold my gold a couple of weeks ago and I bought stocks last week.

    But I do understand what happens during a secular bear market. Stocks go from extreme overvaluation (P/E of 45:1 in 2000) to extreme undervaluation (P/E ratio in single digits & dividend yields in the 5%-10% range). This process usually takes 15 or more years, barring a complete melt down like 1932, when it happened in 2 years.

    That extreme undervaluation may come at the 2012 low. If it does then I will start adding biotech ETF’s as a long term hold to ride the next secular bull market.

  42. Beanie

    I actually think we now have all the ingredients for a mega bull market in equities. I recommend watching your shorts if you guys are shorting. I think 2012 is when everything goes crazy crazy…to the upside. And I think I know what will cause that. It will be a combination of green tech and mobile tech.

  43. auger

    Beanie, what stocks are you snatching up, with the intention of holding through a bull market, right now?

    BTW, the great Warren Buffett, hedges/trades/shorts with options, all the time. I wonder what he would think about an entire market ban on shorting?

  44. Gary

    And that is why you will get dragged down into the depths of the next bear. Because you refuse to acknowledge that secular bear forces are at work on the stock market and it will continue until it cleanses the system of debt and returns stocks to insanely cheap valuations.

    The rest of us will use our profits from riding the gold bull to buy stocks at the bear market bottom rather than getting caught in it.

  45. Gary

    It looks like you are using a parabolic SAR indicator. If so what settings did you find worked the best with the least whipsaws?

  46. Venicerain

    Gary,

    I’d like to know your insight of the long term picture for Dow/Gold ratio. If it does drop to around 4.5 in 2012, when do you expect it to drop to 1 or lower?

  47. Beanie

    You can tailor any explanation you like why mkt goes up/down. But don’t forget 1 indisputable fact: Bull markets end w/ greed, not fear.

    This is the time to back up the truck on equities.

  48. Beanie

    Auger,

    Buffett has publicly stated that he thinks shorting helps the bulls, but I don’t think he really believes that. There was a reason why he never split BRKA for many years, and it has something to do with keeping the daytraders and shorties away. Short term short selling bans (2 weeks) are bad for the markets, I agree, because shorts wait for the ban to get removed and they short like hell (just to prove short selling ban is bad). Short selling is hedgefunds’ bread and butter; so they will do everything in their power to make it look like bans are bad. However, if countries ban short selling for 1 year, 5 years, or forever, I don’t think there is anything bears can do but to find other ways to make money. I suspect long term or permanent bans
    actually help the market, not hurt it like the bears want people to believe.
    —————————

    Nobody knows what Buffett really does in the short term because he has permission from govt not to reveal all of his trades. But he did claim that he rarely turns on the computer during market hours.

    Gold is okay to own but since it is a bet against America, I wouldn’t hold more than 25%. Nobody has ever won betting against America in the last 200 years. The odds aren’t on the bears’ side — just horrible odds if you ask me.

    Technology – anything that helps speed up or removed bottleneck on the internet is a good bet, as well as anything related to cloud computing and apps. I like FIO (chief architect is cofounder of Apple), VMW (founders orginate from Microsoft), GOOG, AAPL. Of course, I like AMZN, the next Walmart.

    Green tech — FSLR (king solar), BYDDF (Buffet electric car pick), and……special secret sauce…

  49. Shalom Bernanke

    Beano,

    Looking at CY, MU, and STM I see many names in your favorite group (semiconductors) have been cut in half since only May-June.

    What’s Buffett say about losing half your portfolio in 3 months?

  50. Power Corrupts

    The reason I subscribe to SMT, and the reason I believe it is indespensable, is because SMT gets the secular nature of market moves. Whether or not a subscriber takes every cycle trade, the basic assumptions of SMT about how markets behave over time are the same as this subscriber’s. That understanding is key to long term growth of one’s capital imo (and personal experience, at least, supports the case).

  51. TZ(8155)

    My thoughts from last week havn’t changed. Gold needs to rally here back towards the highs in the next day or so for the parabola to still be in effect. It really could be. Don’t count it out yet.

    But it can’t just stay flat down here and meander. After you’ve gone vertical you either need to keep going up or it’s over. Move like a shark or die.

    Silver looks like a bear flag last two months, so that seems to suggest lower. And gold has a triangle here last day that is looking like a continuation down.

    So for the moment the odds would seem to favor us going lower, but I’ll let the mkt tell me.

    If we *DO* go up then there should be plenty of ability to jump back in for a final 100-150 dollar move.

    Don’t forget that this week is also equity options expiration so there will be games involved there too. There are a ton of calls on GLD at most strike points and very few puts except at much lower levels. So that should offer no downside resistance.

  52. TZ(8155)

    I put it out there again that gold and silver will NOT necessarily perform like they did in 2008 even if lots of other stuff drops.

    People have LEARNED THE GAME this time.

  53. Dubbelito

    Tracy,
    Gary said that silver will get annihilated when Gold moves down in its D-wave.

    Furthermore, today is hardly a significant move down in gold since it is moving toward its Daily cycle lows. Silver have not moved very much either, it’s basically flat.
    Watch silver when gold drops down to the 1500-or-so-area.
    BR,
    D

  54. Shalom Bernanke

    I agree with TZ that everybody would love the opportunity to load up with PM’s in an ’08 environment. PM’s will not offer up the same game only 3 years later.

    I’m long metal and miners, not yet adding to gold until Gary wants to get long. However, I am adding to miners into puke outs from now til the end of the secular bull.

  55. William Wallace

    Gary,

    In 08 the Nasdaq rallied 200+ points out of what looked to be a bottom and then dropped to make a new low before rallying 300+ points before the next leg down began…do you expect something like that will happen again, or are you leaning more towards the low is in?

  56. William Wallace

    Gary,

    I see…so even with what looks to be a swing low in now we may still get a new low before we get this bear market rally back to the 200ma, how will you determine if the Daily, IT, and Yearly cycle low is indeed in then?

    Hope that makes sense.

  57. William Wallace

    Sophia,

    That was my thinking…maybe we get a 200 point pop here off the low before making new low to put in the cycle bottom. Im thinking maybe see if we test 2600 and take profits before heading lower.

  58. Gary

    WW,
    No you misunderstood me. I think this intermediate bottom is in for now. We should see a multi-week bear market rally and then a move to new lows later in the year.

  59. sophia

    W2,

    I have more or less the same target, slightly lower as this market can turn very fast…I bought the future at 2035 last week, so I won’t hang around for too long….

  60. Gary

    Bear market rallies tend to last 5-10 weeks. This won’t turn until the intermediate sentiment levels have reversed. That takes time.

    You can relax for at least the next month.

  61. William Wallace

    Gary,

    Ok thanks for clearing that up for me…im just going to hold fast then.

    Sophia,

    I remember you mentioning that you bought futures, and that you were hoping Gary made the right call 🙂

  62. More Cowbell

    Good morning all.
    I see we are approaching the 10 dma on QQQ then comes the 200 day not too far up.
    My garden has weeds and I feel lazy.
    oh, what-to-do…

  63. Gary

    E,
    They won’t. and I wouldn’t anyway just look at how stretched (link I posted in an earlier comment), gold is. One would have to be nuts to buy something like that.

  64. William Wallace

    Gary,

    If you get the chance, take a look at the low put in on the Nasdaq on 1/23/08…thats what im concerned about. After the swing low was put in the market turned and pushed lower, im not sure where we were in the cycles at that time though.

  65. DG

    I am going to be posting a lot less here until at least October. I am traveling a ton for business until then, and have started a couple of new enterprises that are taking a lot of my time. (BTW, my new website had some technical difficulties, but should be live this week.) Email me at [email protected] if interested). Also…

    I passed my Series 65 exam and am now Registered Investment Advisor! (as soon as CA finishes the paperwork.)

  66. 86d4life

    Good for you DG and best in your new endeavors. We have been very fortunate here that you have shared your expertise with us. Thanks and good luck.

  67. Poly

    In terms of being stretched, this would be one of the lighter C-Wave tops. It would also be considered very light in terms of the multi-year preceding run up, you would expect a massive top. We’re also well into the 2nd half of this glorious bull market, so they should get bigger.

    We’ve also got that big unknown out there, out all of the C-Wave tops, this was the only not to be dollar collapse fueled, it was all demand driven. One should not so readily discount this point.

    It certainly will be interesting to see it unfold here, I’m keeping all possibilities open, last thing we want is to miss another big $300 move once this settles into a cycle low.

  68. Feel

    Is there a consensus expectation for gold’s *short-term* reaction in the event of a Tuesday Eurobanker announcement of new money printing?

    Separate question, what is the recognized most liquid inverse gold ETF?

  69. auger

    GLD looks like it’s on a melt up, to fill its intraday gap, around 170.63.

    It’s also a possibility Gold futures are building another bull flag, on the daily

  70. Gary

    I’m more worried about getting caught in the crash that always follows than missing any further move.

    This is by far the biggest most
    parabolic C-wave of the entire bull market. Those that don’t know any better worry about missing the move. Those that have been through this kind of thing before worry about losing all their profits.

  71. Poly

    Auger, the two most recent one’s covering the majority of this bull market.

    In fact, the 09 peak was greater, that wasn’t even a C-Wave top!

    Careful getting hung up on one idea, the evidence can be viewed from many prisms.

  72. Poly

    WW,

    Why on earth would use nominal values?

    This past top is only the 4th highest above the 200dma, a serious warning for sure.

  73. Poly

    “Those that don’t know any better worry about missing the move. Those that have been through this kind of thing before worry about losing all their profits.”

    Gary, it’s a good warning for many, but it’s never black and white. We already banked our profits, watching this from the sideline and can then play the next DCL with very limited risk, I’m sure you know that. You keep referencing the silver experience but they are in no way related. You rode that drop to the bottom, you’re already out here.

  74. Gary

    Poly,
    I’m talking about the people still in or contemplating jumping back in because they are worried about missing a move.

    For many people it’s more painful to miss a move than to lose money. Well almost 🙂

  75. Poly

    Auger,

    You’re showing me a 20 year LOG scale chart of a major bull market. OMG.

    WW,

    2009
    High $1,227 200dma = $975.50
    Stretched = 25.79%

    Now
    High = $1,817 200dma = $1,459
    Stretched = 24.54%

  76. auger

    Poly, I’m not sure why you’re OMG’ing, buuut that is a linear scale, monthly chart. You said, that there were other c-waves that were more stretched. Please show me on a chart.

  77. Michael (Hulk)

    Doc showed today that gold is 36% stretched above its 80MA now and has been 44% and 51% stretched at previous tops.

    The point is probably academic but as markets generate more and more data, the whole concept of stretch gets more extreme. Read a market book from 20 years ago and they were all freaking out non-stop about October 1987 – we just had an event in equities of comparable magnitude and we had several in 2008. 2008 blew the barn door off of any historical comparisons. Historical precedents need to be taken with a grain of salt – extreme will become much more extreme in future.

    The simple analog charts are misleading for longer time periods and log or semi-log charts reveal a truer picture. Nothing stopping gold stretching 60% above its MA before a top.

  78. oa92000

    Buffett, who is estimated to be worth more than $47 billion, called on Congress to commit to “shared sacrifice” and raise taxes on people earning more than $1 million. Buffett said the rich are “coddled” by Congress “as if we were spotted owls or some other endangered species.”

    “While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks,” Buffett wrote in a Sunday New York Times Op-ed.

  79. Poly

    Auger,

    Sorry if you took offense to the “OMG”.

    But you can not use a linear chart for a bull market.

    Are you saying that in 2001, if gold went from $200 to $500 overnight, that it still would not compare to this $300+ move? I don’t think so.

    Again, 2006, 2008 and 2009 were all stretched further.
    I’m off to lunch.

  80. auger

    Poly, didn’t offend me, no worries. It doesn’t matter what scale you use, stretched is stretched. I’m talking about technicals, you’re referring to price appreciation, it’s not the same thing.

  81. skogie1

    Gary, even though gold is pulling back it’s not showing the type of sudden sell-off usually associated with parabolic tops. Any thoughts on that?

  82. Poly

    “Why the log charts for bull markets?”

    If you bought this bull on day 1 and held for a few years, you would have doubled your money and sold out at $500, for example. That’s a $250 move. If you bought 18 days ago, you also had a $250 move. Who made more money?

  83. MrMiyagi

    Poly,
    I don’t get it unless I misunderstood.
    Are you talking about a logarithmic scale vs a linear one and if so, how does that affect what you are saying?

  84. Poly

    @Auger,

    “It doesn’t matter what scale you use, stretched is stretched”

    I’m not sure this is accurate as the argument here is not if it’s stretched, I’ve acknowledged it is.
    The argument is if this is stretched the most ever and I’m saying there have many other instances, one not even associated with a C-Wave top, that have been stretched further.

  85. William Wallace

    Miyagi,

    Does this answer your question about log charts during a bull market.

    Imagine a company with a stock price increasing by 15% each year for 20 years. Think about how you’d normally draw a chart of its stock price. You’d probably use a linear chart, as that’s what most of us learned to do in school. The graph would show a really curved line, though. It would look like the stock price grew slowly in the first years, and then zoomed up a lot in the last few years.

    That’s because in the first few years, the change in the stock’s price might have been from $10 to $11.50, and later from $25 to $28.75, and later still from $75 to $86.25. So the absolute changes will look small at the beginning, and will look large later on. But it’s really just been a steady 15% increase from year to year. (Remember, an investor should be just as happy with a total 50% return from $20 to $30 as from $100 to $150. Investment-wise, percentage-wise, it’s the same thing.)

  86. auger

    Poly, that doesn’t explain why log charts are used. You wouldn’t double your money, just because you used a log chart.

    Log scale, simply plots the vertical axis in percentage change. So, $250-$500 looks the same as $500-$1000.

  87. Hack

    If you want a good index fund look at VEU. Seasonality for QQQ is in October. I’ll give QQQ and DZZ one more day to shape up or they’re gone, (gold and silver look strong here). And REIT’s are killing it today, VNQ.

  88. Poly

    I’m really confused on the insistence and focus on nominal change over so many years. You presented a 20 year chart showing a massive bull market in linear terms and dedcuting from the awesome “visual” of the chart that we are stretched further this time around. Of course we are and always will be, you’re solely looking at the absolute change and not the percentage change.

  89. Poly

    Auger,

    Of course it’s all good, except for that shady WW character. 🙂

    In the end, it’s all free anonymous advice, 99.5% of it is useless.

  90. William Wallace

    Poly,

    Stop lying your not confused…you know most of us dont understand what the hell the difference between Linear and Logarithmic charts are!!! Try being more helpful in your explanation and stop bashing us fools…lol 🙂

  91. auger

    Haha Ploy, you’re good at putting words in people’s mouths. I’m not insisting, deducing or focussing solely on anything. You say Gold has been stretched further, at previous peaks, that’s fine with me.

    Meanwhile, it looks like Gold wants to break out of another bull flag, here

  92. Poly

    at ease,

    We should expect at least a clear DCL, so we should see it drop below $1,700 soon enough, IMO.

    OK, back to real work.

  93. Dan

    Really guys? Your debating whether to use real or nominal values to compare changes? Using nominal makes zero sense, compare relative changes.

  94. hamvestor

    “Bull trap in place?”

    Perhaps, and I’m totally out of pm’s now, but that said, the GLD chart right now sure looks like it’s about to launch on another leg higher. jmho.

  95. wolf33

    interesting–last time on this site was mostly bullish—now bearish. there is another cycle that takes gold up into october. one has to at least wonder. no axe to grind—-but have pointed this out before. persons pivots on daily gold has not given a sell. all i look at

  96. hamvestor

    “Either to infinity or to brief new highs?” aklaunch, that’s a question for which I wish I had an answer. Gary’s calls have been working fine for me (I’m in QLD and SSO at the moment, and avoiding pm’s), but it sure looks like we have GLD breaking out of a bull flag for another move up. It’s tempting to jump back in, but I’m resisting for the moment anyway!

  97. wolf33

    btw—wae at Ames straw poll. The boots on the ground are more energized than anyone here including me for Ron Paul are awesome. next fund raiser will be key!

  98. William Wallace

    I found that the best time to buy gold futures for short term scalps is when the heavy selling ends (like now)…its almost certain that gold will slow buy grind for a $10 move atleast

  99. aklaunch

    WW,

    Where do you think the last drop in GLD places us. Seems it bottomed around GLD 168$. If we where going to call that the DCL then any move below that should constitute a failed cycle and we can count on a nice drop?

  100. Robert Thrane

    I’ve never seen so many pro-gold articles and headlines in my life as I have the last two weeks!

    CNBC all last week, and MarketWatch all today.

    Count that with the 90+ million tick down in GLD last week and I for sure don’t see us breaking new highs for awhile, maybe even a year!

    I think the dollar with maybe fall, maximum another 1% or so and test the previous DCL then from there to the moon until QE3 eventually.

    Just my two cents.

  101. D

    Hey I wanna learn about using put options to short in preparation for the move down after the bear market rally is over.

    What I want to know about is the “VEGA” I’ve been hearing about on the blog.

    The VEGA coincides with the VIX correct? And the option would be cheapest when the VIX is lower and is more expensive when the VIX is higher? The VEGA positively correlates with the VIX whether you’re buying a PUT or a CALL?

    Is this correct?

  102. Brad

    This is from Investor’s Business Daily:
    For chart analysis, should we look at a logarithmic or an arithmetic scale?
    When using a daily chart, an arithmetic scale chart (in which the vertical axis denoting a stock’s price shows equal spacing between each unit of price) is fine. For example, a flat base will appear as a tight formation on either the linear or the log scale chart. More importantly, check to see that the percentage price change between the high and the low of the base fits the parameters of the base it portrays. In a good flat base, the stock should never fall more than 10-15 percent below the peak in the base. In a weekly chart, a logarithmic chart has a couple of advantages. If a stock falls from, say, 200 to 100, the depth of the drop will look the same as one that falls from 40 to 20. In both cases, the stock has dropped 50 percent. Also on a log chart, you can more clearly see when a stock is rising fast or too fast in price. If a stock rises 50 percent or more in just a week, it will look more dramatic on a log chart than on an arithmetic chart. Such climax runs following previous big gains often signal the stock’s top.

  103. William Wallace

    AK,

    Around 1725…I cant see a DCL being put in unless we close at least below the 10sma or a bounce off the IT trendline, but anything could happen at this point and gold could just move higher from here and that would be it for a DCL. We are pushing back above 1770now and may wind up putting in a swing low already.

  104. Shalom Bernanke

    wolf33,

    Good to hear about Ron Paul. I also caught a poll on Topix that showed 60% of the nation thought he won in Iowa.

    Also, not all bears here, as I’m still long my miners and 70% of my PHYS. I don’t think the question is to be long or not, but to be long with size that fits one’s risk profile.

    Good luck.

  105. wolf33

    ww—Costitution=Stat issue.

    We are broke—The Fed and much more are cooked. BRING THE TROOPS HOME and get a handle on Military Industrl complex. I am a Viet Nam War Vet. Anything else go to web sites or dozens of u-tubes.

  106. Robert Thrane

    Ron Paul is the man. I’ve met him first hand. He would turn this country around in an instant, but sadly, he will never get elected.

    Remember folks we have an electronic voting system- don’t be fooled- everything is completely locked down.

    WW, what’s wrong with legalizing drugs? If idiots want to put drugs in their body, so be it. We also people to drink as much caffeine as they want, what’s the big difference? Freedom of choice is key. Education also, and most people would decide not to do drugs if properly educated.

  107. wolf33

    Shalom–Agree! But overall site has changed since I was last here.

    RP—Yes I think he won—but biased. There were thousands there.
    Paul had the boots and Bachman the $. Many more will give in next fund raiser.

  108. Shalom Bernanke

    WW,

    It’s about liberty and small government. Besides we’ve been fighting a “war” or drugs and every other thing for decades, and still drugs are everywhere.

    His stance on drugs is not the jist of his message.

  109. More Cowbell

    To me, gold looks like a weightlifter doing a clean and jerk. It did the overhead jerk phase on 8/10. It’s been holding for 3-5 days just like a lifter… Tomorrow is when the junk gets put down!!! imho…

    Tom (tommyd)

  110. Shalom Bernanke

    wolf33,

    I think you’re right on RP. He’s got my vote and many I talk with each day. All the other GOP candidates were more concerned about a NEW war with Iran than the American people.

    And the whining about Israel was enough to make an American lose interest. Israel has many nukes, we just gave them 21 brand new fighter jets last year, and they can defend themselves. AIPAC runs our government, for now.

  111. William Wallace

    Drug dealers and cartels will not simply become gentleman/businessmen if drugs are legalized. Unless you are a drug dealer, or ex drug dealer, or are an addict or come from a family of addicts you can never understand what legalizing drugs will do to this country.

  112. Robert Thrane

    Hey Gary, congrats, it wasn’t too hard I’m sure, but you did say that Gold would well outperform silver for the C-wave finale. You were right on again.

  113. Shalom Bernanke

    I’m with ya on the miners, Alex. Although I’m long gold too, I’m hoping they DO smash ’em lower so I can add comfortably.

    If not, I’ll live with what I have.

  114. Shalom Bernanke

    WW,

    Drug dealers will be out of business. Are you serious that of all the problems this country has, drugs is your main concern?

    How’s that drug war working out?

  115. William Wallace

    SB,

    You think drugs are everywhere now? You have no idea what it would look like if they were legal. It will go from stupid choices breeding addicts to peer pressure at the levels never before seen breeding drug addicts.

  116. Robert Thrane

    Legalizing drugs would ruin the cartels. The prices would plummet, and supply/demand would force cartels into other lines of business.

    Once you legalize something less people want it. People spend more time thinking and talking about forbidden things. Once legalized it will quickly be placed on the back-burner and lose its fad.

    Plus we wouldn’t have this massively over expensive jail system that houses tens of millions of drug users.

  117. Shalom Bernanke

    WW,

    Cheaper, cleaner drugs, with s much reduced prison population.

    If an idiot wants to do drugs, he can get them anyplace with the current system. It’s about freedom to choose and making decisions for oneself.

    Besides, the drug problem we currently have is proof the “war” on drugs does not work, however id does keep prices high and induce “dealers” to get in the game.

  118. Shalom Bernanke

    And how’d the “war on booze”, aka Prohibition work out?

    Booze kills, make it illegal. Of course drugs damage society, but spending many billions (probably trillions if you include those incarcerated) is not the solution, so it’s time for a new approach.

    Is everybody a drunk b/c booze is sold in stores? Nope.

  119. Keys

    Eeesh! Going long or short looks like playing chicken in a car going 100, while blind-folded, with a screaming toddler in the back-seat, while texting with a cell phone in one hand and bottle of something illegal in the other.

    I know Gary says never to short a bull market, but we will get to the point of never never never go long in a bull market too.:)

  120. Poly

    I like Ron Paul, but I have no idea why his campaign managers try to mix it up with all of those other extreme conservatives. By going toe to toe with them, he gets lumped into the same extreme group, the independents and center democrats are frightened of that group.

    I totally agree with WW on the drugs. I hate spending billions on a drug war and yes you should be able to roll a joint in your own home. You should not go to jail for using!
    But to legalize all drugs would be a huge disaster. To believe otherwise means you’ve had zero exposure to addiction and the forces behind it.

  121. Ben

    Is it legalizing, or decriminalizing, that Ron Paul advocates?

    Spending $20k or more per year to keep drug addicts in prison is about the most idiotic thing we do as a nation. It benefits the prison lobby, nothing more, and harms so many.

    Prohibition was repealed during the Depression. State’s will decriminalize because they have to, not because it makes so much sense.

    And seriously, after thirty years of our ‘war on drugs’ doesn’t it now meet the definition of insanity to continue?

  122. ...at ease

    Seems to me, it’s just another tax income for govt to get their hands on. The more kids you can hook, the more income taxes coming in down the line. The middle class will subsidize the habits of the disengaged of society even further.

  123. Shalom Bernanke

    WW,

    Yes, I’ve had friends die from drugs, but that is irrelevant. I’ve known many that died from drinking as well.

    The legality of the drug does not make the abuser. Weak people find drugs today, and at times even feel they must commit crimes to fund their habit because they can’t afford them.

    Dirty drugs are also a problem that kills. Likewise, prescription drug addicts are everywhere these days. Drugs will exist and get abused no matter the laws.

  124. Shalom Bernanke

    Robert Thrane has a point, we better make banks illegal too, and the cars people drive to get them.

    Then lets throw the parents in jail for poor parenting, and on, and on…

  125. Shalom Bernanke

    WW,

    I can sure as hell tell you I won’t be begging the government to get involved if my kid gets hooked.

    They screw up everything they touch, and just use these excuses to reach further into people’s pockets.

    WW, you were hurt in a motorcycle accident….they too should be illegal.

  126. Larry

    YES – we do know what it would look like it drugs were legalized… it’d look like holland… where they have the lowest hard core drug usage % in the world…. cause it’s legal…

  127. William Wallace

    SB,

    Are you saying everything that kills should be illegal? I never said that. Maybe everything that willingly makes people kill should be illegal. Enough of this conversation for me.

  128. Shalom Bernanke

    Larry’s point is just one more reason for us to dump a failed approach. ours hasn’t worked, in fact it’s failed terribly, while other countries doing the opposite have lower numbers of abusers.

  129. ...at ease

    SB,
    You are correct, the last thing you want is govt in your family and business affairs. Smartest thing you can do is keep the govt out of your life. PERIOD. However, they will always find a way to creep into your life (any reason they can find). Has anyone read about the Lois CAPPS laws (have to pass it to see whats in it). Amazing now they can put their hands into your 401k now and tax you further on capital gains. And I believe I read they can designate where you put a percentage of your funds.

  130. marksomething

    the definition of an addict is:

    doing, ingesting, consuming or what have you more than once makes one an addict. if you know the effects after smoking a joint and you go back to do it again, you are an addict. very simple and concise.

    dependence is an altogether different subject.

    people “do” drugs to numb themselves or to escape their reality. I was one of those people. once I realized what I was doing I gathered my wits and found keeping busy with creative endeavors kept me from numbing myself.

    granted my escape of choice was pot. but if I had of paid tax on what I consumed Canada’s health care system would be flush with cash.

    tax the hell out of cigarettes, pot, booze, shrooms and licking toads. lol. opiates shouldn’t be legal

  131. Shalom Bernanke

    WW,

    That’s the point William, it’s personal choice at the same time less expenses for those that opt to stay away.

    I think riding motorcycles is insane, mostly because others on the road don’t know how to drive and you can’t know which ones do. You ride bikes on the road, and I choose not to, it’s not for either of us to make the decision for anybody but ourselves.

    I’ll let it rest at that.

  132. Robert Thrane

    “It’s the banks laundering money for the cartels that finances the tragedy,” says Martin Woods, director of Wachovia’s anti-money-laundering unit in London from 2006 to 2009. Woods says he quit the bank in disgust after executives ignored his documentation that drug dealers were funneling money through Wachovia’s branch network.

    “If you don’t see the correlation between the money laundering by banks and the 22,000 people killed in Mexico, you’re missing the point,” Woods says.

  133. ALEX

    SB
    I remember when you bought_ you’re nerves of steel have paid off…you didnt panic out when they got caught in that MKT flush, but when I look at it now–

    Some miners ( EGO, AUY, Rangold)are at highs…with the markets still near its lows. I see strength in Miners.

    nice job Holding on

  134. Shalom Bernanke

    Alex,

    Thanks. I just put AUY on my screen for purchase next time we get a sizable pullback. Love the fact they’re dividends are being raised, and frequently the last few quarters.

    🙂

  135. ...at ease

    RT,
    In Mexico, on vacation or traveling, you can only spend so much USD a day down there. Most restaurants and hotels can only accept a limited amount of USD (cash) now as the banks only will take in so many USD cash from the businesses down there. I was wondering if it was because of the lost value in the USD, but they say it is to control the drug money running through the banks in Mexico.

  136. Gold Lion

    Gary you said..

    “I think it’s time for liquidity to drain out of gold and flow back into a severely beaten up stock market.”

    And I agree, but some of the most undervalued stocks are the mining shares. JMHO

  137. Shalom Bernanke

    I’m trying to find a chart I saw a year ago or so to share with you guys. It’ll put the whole miner vs. metal issue in perspective for the rest of this secular bull.

    I can’t recall where I saw it, but will post when I find it.

  138. William Wallace

    SB,

    Riding motorcycles doesn’t destroy you, your family, and others who cross your path, it is the other motorist (as you have said) that destroys you. You can’t compare motorcycles to drugs.

  139. ...at ease

    W2, I agree, I like some of his ideas, but some are too extreme.
    Bachman has the same issue, too extreme. Have to find someone who can make govt work for the people.

  140. Robert Thrane

    Woods, 45, says his bosses instructed him to keep quiet and tried to have him fired, according to his letter to the FSA. In one meeting, a bank official insisted Woods shouldn’t have filed suspicious activity reports to the government, as both U.S. and U.K. laws require.

    So one could argue by depositing funds into your bank you’re indirectly supporting the drug trade as they’ll lend it out to buy DC-9s for the cartels! LOL!

  141. Shalom Bernanke

    WW,

    Sure I can compare motorcycles to drugs. Motor cycles are too dangerous to allow anybody to ride them on public roadways.

    Ron Paul is about liberty, and the issue of drugs is just a tiny part of his message. Spend some time getting to know his views, then we can talk.

    When is the last time you agreed with every view a politician had anyway?

    One thing for sure, drugs didn’t get my kids and I hope not yours, but the Fed certainly has.

  142. Robert Thrane

    Didn’t you guys ever read about the US/NATO troops ordered to protect the Afghan poppy fields?

    U.S. Marines protect Afghan’s poppy fields

    I’m just trying to point out that most of you misconceive the hierarchies of the drug trade! All of you start talking about drugs and you don’t even know how it gets to your neighborhood yet you’re strongly opinionated on it!

  143. Shalom Bernanke

    Robert Thrane,

    Yes, I know about that, and have even seen videos of our troops playing in the fields (marijauna) while smoking pot and looking for somebody to shoot.

    Truly ridiculous!

  144. William Wallace

    SB,

    Motorcycles are dangerous because other motorists are dangerous, you said it yourself…legalize drugs and a whole lot more motorcycle riders will be dying from other motorists.

    I know Ron Paul, I know you cant agree with everything, but he is too extreme…I think our founding fathers would even consider him extreme.

  145. Robert Thrane

    We can now see a gap down without needing to gap fill with today’s close near the highs.

    Although I’ve noticed that preceding the largest moves of anything trade-able, there is usually a gap that ends up not being filled which fools traders.

    … look at the RUT prior to the market collapse, and silver and gold going into their different parabolas.

  146. Keys

    FWIW i remember oil dropping, and I don’t remember exact numbers, something like 10$ before making new highs, only to go for the final nose dive. That was also the time when the divergance in oil stocks stepped up massively.

    All this to say…pppttt…I have no freaking clue!

  147. ...at ease

    W2, they did a movie on that… didn’t they?

    Our forefathers are rolling around in their graves moaning, at our loss of freedoms. We are no longer a free people. The govt owns all of us at least our income producing capabilities. They just want more money. It’s illegal if someone else does it, but not if they can tax it.

  148. Shalom Bernanke

    WW,

    Well, anybody can call anything extreme. I think doing the same dumb thing over and over at growing expense is extreme.

    I’m sure England labelled our Founding fathers “extreme”.

  149. marksomething

    back in the day… the black panthers protected the neighborhood from the drug trade. very rarely did one ever see a junkie on the street or not getting some form of aid. (not saying the BP org. was good or bad, no judgement here).

    just before their ouster new York state officials, ny mafia and the Feds conspired to bring drugs to the hoods formerly protected by the BP’s

    the day after the BP were chased out, any one could observe the drug trade out in the open on the street and not a single law enforcement individual could be seen

    drugs of all kinds are meant to pacify the masses. one could argue that tv, the interweb and social networking are drugs pacifying the masses.

    if we are not in front of the tv. we are most likely demonstrating to change the way gov’t is run.

    what do you think the powers that be want? a drug free state? hardly

  150. ...at ease

    The powers that be in England just wanted their tax money and all the goodies they could on the backs of the colonialists. They asked England for freedom and were turned down and the rest is history. We need to get back to basics again. Sweep the dirt out and cleanse our govt structure of all the unnecessary laws that are outdated and no longer needed.

  151. Robert Thrane

    mark,

    you are dead on.

    the great thing is that soon enough our taxes will be raised and we’ll be transferring more money to support this system! Can’t wait even another minute!

  152. Robert Thrane

    We’re due for an oversold RSI in gold. This hasn’t happened for close to 3 years! It will come soon, it almost has to!

    … same with GDX, and silver…

  153. Shalom Bernanke

    WW,

    Since we cannot know if it’s a D-wave (or will be), I’m inclined to hold PHYS too, but for sure my miners.

    At this point I doubt a D-wave will even put my PHYS in the red, so shouldn’t bee too difficult to stay with it.

  154. ...at ease

    MS,
    You are right, the govt doesn’t want an uprising from any group. They will say or do anything to pacify the masses.
    They sure don’t like the Tea party.
    Some are placating and some are ignoring, simply pretending they don’t exist while others call them extremists and have no impact on them. We shall see.

  155. Keys

    SB,

    Old turkey sounds great for me, until I see the parabolic turn. I wish I were still a turkey, and question that move each day, but my answer is the same each day…I see parabolic I run!

    I am not 100% out though…I saw the parabolic move in silver, got out of that…but for now, I still hold a big of gold, which true to my word never sold…I did hedge out the position though..I never thought the extremes would have been hit, but I caught 50% of the move up as my put and put spreads got leveled. I re-allocated my puts since upwards to lock in those suprise gains.

    I never stay in parabolic move events, if it weren’t for that I would have stayed old turkey. Up and downs are no big deal, but I have yet to see any parabolic move not crash horribly. If this is the first, so be it, I guess I will let me pot(no pun intended 🙂 ) do the work.

  156. Shalom Bernanke

    WW,

    Yeah, I expect to take a hit in miners. I’m up enough I believe I can weather the storm. It might play out that the miners have already forrtold the D-wave, and that the worst has passsed (for miners, not metal).

    We’ll see, but if I can buy heavy someplace near the D-wave bottom, I will hold the rest of the bull market. The time is near for Old Turkey on the miners. 🙂

  157. Robert Thrane

    Wav-Ridah,

    mind posting that chart which projects this fall to be the single best buying opp. for miners besides 08′? I remember it was one of Rambus’ charts.

    Where are the Rambus charts posted? Or does he have a service? Thanks man.

    It is possible I am mistaken and it was Gann, but pretty sure it was Wav…

  158. marksomething

    well ww,

    I’m in Canada and the account I trade with is a tax free savings account. anything made inside this account is completely tax free ONLY if I’m holding/trading Canadian securities. if I trade American securities I am responsible for American taxes. having said all that (breath in)

    I will be holding hqu.to 2x lev. really cheap right now. in fact hold a lil for a few days now.

    they is a Canadian ETF

  159. Keys

    Good point on CME…once they start with margin hikes, they will keep going until they see things stabilize…guaranteed they see the same things we have noted on the blog and want to minimize their risk.. but this of course is all guess work….

    Gold will do whatever it wants!

  160. Gold Lion

    SB,
    I would love to see that chart on correlation of gold to mining stocks if you can find it. I know I read that mining stocks didn’t top out for over six months after gold during the 1930s so I don’t know why it would be different this depression – lol

  161. William Wallace

    at ease,

    No…I sold same day, I told you that day I felt gold was going to grind higher, its pretty much always the same once the heavy selling stops, there is always that slow gring buy until it hits a resistance level..today was 1767
    When the panic selling begins then buyers are alittle bit more cautious and that grind higher usually ceases and becomes flat until big buying begins to push it up…basically the reverese of whats happening now

  162. wmp

    I’m looking at the SPY 5 minute chart..the first two five minute periods after the close have tails decending to 118.15. Can someone tell me what’s happening with those? Running stops to buy down to that level?

    Thanks in advance.

  163. Hack

    The market is now dictating the price of silver and gold, not TA. Time to overcome, adapt and take advantage of the situation, which means buy miners…

  164. Michael

    SB,

    I have to second what Alex said about you controlling your emotions and not only holding by adding to your miners… you motivated me to follow my instincts too. THanks.

    YOu too Alex, thanks for your charts and for sharing your miner picks.. got them all on my screen and watching for entry places…

    PS, SB you are spot on about Ron Paul and the absolutely ridiculous “War on Drugs”… just the like Bush’s ridiculous “War on Terror” which is only meant to increase the size of gov. and terrorize the populace…

  165. Frank

    While you guys are fretting about D-waves, NGD just hit an all time high around $12.

    I have to say that I was not very impressed by Gary’s strategy during the Dec 2009 to Feb 2010 correction. I don’t really recall what happened in Jan 2011….

    Nevertheless, I think it is much better to manage exposure (not go all-in or all-out) at peaks and correction lows by gradually going from 30% to 60% cash, for example. My understanding is that a so-called D wave is a major correction that retraces 50% of gains and this is built upon the 2006 gold peak experience, and this is the underlying fear that prevents Gary from being invested in anything gold related now. I do not see any other such events for 2001-6, and 2008 was obviously a special event. Even the May 2011 correction in silver is not a “D wave” correction unless it has another major leg down into the mid 20s.

    You could have purchased NGD for $8.70 in June. I purchased most of it for around $1 in 2008 and apart from some trading positions in late 08-early 09, I sold my first NGD shares last week at $11.75. Certainly a worthwhile trade since June if you don’t want to hold long term.

    p.s. Re drug policy you must read: http://www.amazon.com/Saying-Yes-Defense-Drug-Use/dp/1585422274
    Ron Paul does not focus on it and deflects the issue as being something that should be delegated to the states and thus not an issue for a presidential candidate. Actually, another good candidate is/was Gary Johnson, but I guess he just went up in smoke. He is less “extreme” than Paul and would have broader appeal. The rest of them are either religious zealots or RINOs. Actually the two main RINOs are religious zealots in their personal lives.

  166. Shalom Bernanke

    Michael,

    With regard to politics, I’m glad more of us are seeing the same things and speaking up about it. 🙂

    As far as miners are concerned, as long as we know the average ranges to expect (like 15-20% moves/week in my names), we can be sure not to get in over our head with too big of positions. It’s the positions that are too large for one’s risk tolerance that forces the mistakes.

    Glad you’re on board, and although I expect volatility as always, I’m not concerned in the least. If they puke ’em out we can use that opportunity to add and if they rip we’ve got some exposure.

  167. Hack

    Who needs gold at $2000 to make profits when there are thousands of companies beating the pants off of gold? Hell, even the S&P is beating gold 4x the past five days. Anyone sitting on the sidelines is missing the best opportunity of the year…

  168. Shalom Bernanke

    Robert Thrane,

    I’m not salivating over $2000 gold b/c I want to have pullbacks to add. With strong hand status it’s easier to see straight and welcome the drawdowns as opportunity.

    Once I’m full to the gills and with a nice size cushion, THEN it’ll be hard not to get a little excited on the crossing of $2500!

  169. Shalom Bernanke

    Even if gold goes immediately to $2000, we’ll have a decent beat down eventually. It’s all in how we view the pullback. Painful, or opportunity to add some more?

  170. Shalom Bernanke

    The next best opportunity to buy miners will be when stocks pull back, and IF the miners can pullback with them I will do some buying.

    I’m not sure when that will occur as Gary is still long and I trust his instincts, but whenever it presents I’ll take advantage.

    Alright, enough from me. I’m off to spend some time with family.

    Good luck tomorrow.

  171. Mean Guy

    60% all federal prisoners in for drugs
    25 Billion fed and state spending annually for drugs
    U.S. spends 44% entire worlds defense budget
    U.S. spends more on defense than the next 20 countries combined

  172. hamvestor

    Pardon me for posting anything on-topic, but CNBC just reported that Steve Cohen (SAIC) just placed a huge bet on gold through a gold ETF. Cohen’s no dummy, so it will be interesting to see how his bet plays out.

  173. Gary

    Cohen is intensely private about his trades. If he made it public that he’s buying gold then you can probably bet he’s trying to sell to the public.

    It’s the same as when I hear Goldman Sachs tell me oil is going to $200, I know they are trying to unload their positions on the little guy.

  174. Gary

    What I’m trying to point out is that you’ve never heard of any other trade Cohen made and now all of a sudden the media is reporting that he bought gold.

    Why didn’t they report when he bought such and such a stock? Because it wasn’t news worthy.

    Right now anything gold is the hot topic so the media latches onto any and every story about gold.

    That’s not what I want to see. I would prefer the media went back to ignoring gold. The rally would last a lot longer if gold was still in the background and not jumping $50 a day.

  175. hamvestor

    From WSJ.com:

    “Has one of the world’s biggest hedge-fund managers turned into a gold bug?

    SAC Capital Advisors L.P., the hedge fund run by Steven Cohen, disclosed a new position in options on the gold exchange-traded fund, SPDR Gold Trust.

    The investment, options that allow SAC Capital to buy shares of the gold ETF at a defined point in time, is valued at $628 million, the single largest value of equity positions disclosed by SAC Capital, according to the hedge fund’s quarterly snapshot of its U.S. investment holdings.

    Cohen disclosed the holdings in a regulatory filing Monday that showed the hedge fund’s U.S. stock, options and other positions as of June 30. As of March 31, he disclosed no holdings of the gold ETF….Among SAC’s other quarterly disclosures, the hedge fund decreased its stock position in Newmont Mining Corp. to 2.18 million shares from 4.6 million at the end of march. He also cut his holdings in retailer BJ’s Wholesale Club Inc., which has agreed to be acquired, to about 996,000 shares from more than 2.8 million at the end of March.”

  176. William Wallace

    Markf,

    I don’t even watch the news so brainwashed by the media im far from it. Maybe your brainwashed by your research, I lived it and don’t need to research it. Drugs are beyond debate, so find someone else to “debate” with.

  177. royboy1979

    Alex in MT said:
    “Cohen disclosed his positions he bought from 04/01/2011 to 06/30/2011. These positions could be long gone by now.”

    You beat me to the punch here…long gone or trying to unload as we speak.

    William-Squared said:
    “Avoid like the plaque people who tell you that your brainwashed and have no idea what your talking about because you haven’t “researched” so and so. Such people have lead this country down the path it is on today.”

    Well said William, truly. I continue to avoid these types at all costs. So, did you enjoy the ending to season 8 of 24?

  178. Shalom Bernanke

    I will entirely ignore Steve Cohen buying calls on gold. AlexinMontana is correct that he could already have sold out so the data could be deceptive (not saying it is, just that it is unreliable). Also, the WSJ is second only to CNBC as far as being useless for making trading calls.

    Lastly, “Stevie” Cohen is a crook much like Soros. Who knows, he might actually be bullish on gold now, but we cannot really know so shouldn’t make decisions on this news.

    WW,

    Your personal experiences with drugs (not saying you, but friends, etc) have no bearing on the discussion. The argument is as simple as this, I don’t drive street bikes b/c I think they’re dangerous, so law should say you shouldn’t. It’s lunacy, despite the friends you’ve lost.

    Diabetes is killing Americans faster than drugs, so gov’t should make laws that you can only have one soda a week. Get it?

    I can get coke in 10 minutes in any part of this country, so what has the drug “war” done to stop it? NOTHING, except ruin more lives and cost tons of money!

    Quit being a hypocrite. Government can’t make your decisions for you.

  179. Shalom Bernanke

    I won’t sell metal just because I think Cohen is a liar and crook, but I definitely would NOT buy on a WSJ report that he’s now a gold bug.

    I remain long, but this Cohen news could make me itchy to sell if I let it. It is not bullish news, except possibly in the long term, if it’s even accurate and factual.

  180. hamvestor

    sb, the WSJ reported his filings. It is not the “opinion” of the WSJ. It is what it is. And yes, he could be completely out of the position by now, but me thinks sometimes you let some of your own, shall we say “bias”?, get in the way of objective thinking.

  181. ...at ease

    Govt could use all that tax money from the sale of drugs. Good place where all our fired postal and downsized military members can get jobs on retraining efforts to work for the IRS.

  182. William Wallace

    Sb,

    Let me make myself clear because now I’m beginning to not even take you seriously. I am for small government, but I am no extreme libertarian. As far as drugs go I believe you have no clue because you have had zero experience with the distribution or use of drugs. It’s this simple…I have had numerous friends, family, etc. who if not having gone to prison they would be dead or still feeding others poison, not one otherwise. Only someone who has had zero exposure to dealing would be so foolish as to believe that when a dealer is sitting there cooking keys of cocaine, cooking coke into crack and washing it with certain chemicals to make the customer fiend as much as possible, or the heroine dealer who even supplies his customers with the needle to overdose, will do anything different when it becomes legal.

    This goes way beyond government telling me what I can and cannot do, because in the end the government benefits greatly through taxing drugs while the country decays with haste like the pothead turned heroine addict.

    Listen… Drop it.

  183. Shalom Bernanke

    “As far as drugs go I believe you have no clue because you have had zero experience with the distribution or use of drugs”-WW

    You are incorrect from the get go. I had plenty of fun in college, and some of the frat boys were the biggest dealers on campus. Almost all turned out just fine.

    You are not a victim, WW. Even if you were, I can promise government wouldn’t fix your problem.

    I’ll leave it at that. Have the last word if you like, but you’re pissing in the wind.

  184. ...at ease

    W2,
    You are correct, it’s all from an individuals perspective. And it takes generations to heal the affects on a family dynamics, not just the user/abuser. And that can only happen if they are aware and all members can change to stop the addict/and his/her affects.

  185. ...at ease

    SB, I agree, the govt cannot begin to fix those problems for addicts or the affects on the family. Their programs enslave all who seek help to a new addiction, govt handouts and providing excuses.

  186. Shalom Bernanke

    And what about all the cheeseburger addicts that can’t stop driving cheeseburgers in their bellies, if only to save themselves from obesity and heart disease?

    Cheeseburgers are way more addictive than “toot”, if you ask me. 🙂

  187. William Wallace

    Sb,

    Frat boys pushing drugs and murderous thugs making drugs are two very very different people, now you can’t be taken seriously and I don’t mean that in a bad way. So what miners are you holding now…. Lol ?

  188. High 5

    There are so many laws on the books that we have all become criminals. I favor as few laws as possible since this would result in the least number of criminals.

    If you eliminate criminals you eliminate cops, attorneys, probation officers, parole officers, judges, bailiffs, prisons, jails, guards, wardens, crime, stenographers, therapists, etc. etc.. Sounds good to me.

    Make everything possible legal and before you know it there will be true freedom.

  189. Robert Thrane

    I actually just opened a restaurant and we ordered as much possible excitotoxins as the national distributors had.

    We jam pack our food with these and it kicks major azz because our customers eat them so fast, and come back so often to get more.

    I learned about these because I knew Ronald McDonald.

  190. Robert Thrane

    The funniest part about drugs in America is that all the most harmful ones are already fully legalized! MSG, Aspartame, and Fluoride. F-yeah America you kick azz!

    Everyone of you is on drugs everyday and you don’t even f’ing know about it! LOLOLOL!

  191. Shalom Bernanke

    Robert Thrane gets it. 🙂

    And thanks for the thought on excitotoxins. White Castle tells customers outright they “crave” the Castle!

    I could only eat about three in the old day, the rest were reserved for a “bonzai whoop shot” onto the overpass.

    LMAO!!!

  192. Shalom Bernanke

    I also agree with High 5 that there are too many laws. Everybody is a now a criminal to some extent or another, because you’re all in violation of something. It’s up to those that are chosen to enforce the law on the ones that they decide.

    There were something close to 37,000 laws created in the US, only in last year (municipal, state, and my favorite, the Federales). Laws don’t fix things, and especially at this advanced stage of decay. Better make your own decisions regardless of what your “TV” says. 🙂

  193. Robert Thrane

    WW,

    you’re totally lost aren’t you dude! excitotoxins are monosodium glutamine and now thanks to the wonderful FDA MSG now falls under 20+ names! Oh hell yeah, we can hide this crap in everything now! It makes foods addicting and some researchers say it’s related to obesity, heart disease, adhd, Alzheimer’s, etc etc (this isn’t provable cause of course there’s few studies on it)

    But it brings in the cash bro! I got couples that can barely muster the energy to go up and down the stairs coming to my restaurant three times a day to get their fix! People totally underestimate this stuff dude!

  194. 86d4life

    Wee Willy,
    the part your not taking into account is the ability of people to take care of themselves. Why do we need govt to take of care of us. If we get rid of the govt telling us we can`t punch the tickets on the nutcases, how long do you really think the nutcases will last? They`ll disapear post haste, guaranteed. Do the research on states that have legalized conceal&carry. When tx legalized c&c, violent crime dropped 25%+ the first year. The only thing keeping the pseudo predators alive is the law.

  195. Shalom Bernanke

    LOL! Thanks for the laugh High 5.
    Your avatar kicked the joke up a couple notches. 🙂

    MarkF,

    No need to apologize for sharing your views on a topic being discussed. Let each man stand on his own views. Free speech still reigns, unless you believe the Constitution is “outdated” or a “living breathing document” as our idiot-box tries to convince us.

  196. William Wallace

    Robert Thrane,

    Lost? Nah bro im well aware my friend, had a heart attack at age 35, im just not obsessed with it. You will die one day, maybe sooner then later, no matter what you do to try and avoid it.

    MarkF,

    Your not disturbed by my thinking so save us all the theatrics. Your one of those people who come on here and try to belittle people right off the bat if you dont agree with them, so I dont even take you serious. The difference bnetween you and me is you dont see drugs as an evil, I do…or maybe you see legalizing them as a greater good and I dont. Its that simple, yet you try to make it complicated and misunderstood by the little stupid idiots of the world. Dont waste your time, I can see right through you, I have been on both my side of the fence and yours.

    86,

    Again,

    Some of us view the world through the eyes of good and evil. Maybe you dont.

    “Dont you know that I have the power to set you free or kill you”
    -Pontius Pilot (Government)

    “You would have no power over me unless it were given to you from above” -Jesus (God)

    No need for responses, I dont believe that what I said calls for any. I hate debates and im not one to engage in them…its a waste of time.

  197. Robert Thrane

    So we got on the topic of drugs cause someone brought up Ron Paul which is actually related to Gold, lol, then WW went straight to the argument of him legalizing drugs as to why he should not be supported.

    So WW, you brought up the drugs baby!

  198. Shalom Bernanke

    And now WW is smoking dope, but want’s to throw Ron Paul under the bus for his ideas.

    Does WW realize he could have it for free if he didn’t want to fund wars of aggression?

    I rest easy knowing most people get what they deserve, myself included.

  199. Robert Thrane

    Gary, this is thumb twiddling until we see something out of gold or the dollar!

    Hell, why would we discuss all the best and cheapest miners when we’d just be paying higher prices for them come their low this fall (if that happens)?!

  200. William Wallace

    I have to go read tonights report and save my sons from a slow aspartame death (funny because I grill my whole family about aspartame, MSG, etc…I dont let them eat any of that, i was just messin with you Robert!)

  201. royboy1979

    William-Squared,

    I know…intense end to the series. That was it man – however I do hear there will be one final movie morphing 24 hrs. into 2. Needless to say it is something I look forward to.

  202. William Wallace

    SB,

    You have no idea how much we really agree on…seriously. If we were talking face to face it would be a whole different story. Writing on the blog always makes things crazy and makes people misunderstood.

  203. RJ

    Shalom mentioned today some charts about how “undervalued” miners are historically. Here are some charts illustrating this from a chart guy I follow.

    I got lucky last week and dove back into CDE (was a long time shareholder prior to jumping on SMT and AGQ early this year) and it sure does look to me the miners had a strong bottom early last week. GDX and HUI are flying. These shares are at “strong hand status” for me now and I am strongly considering old turkey on them long term, especially in the low risk accounts.

    —-instead of clicking one by one, you can go into one link and click on “10 per page”—-

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs29201266%5D&disp=P

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs137255542%5D&disp=P

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs221109051%5D&disp=P

    Here is an interesting one. THe gentlemen annotates this chart indicating good entry and exit points for gold but it uses the HUI. Going by this chart, we are now at an “entry” point for gold. Maybe it should be HUI…Maybe not.

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs44138649%5D&disp=P

    Some additional charts:

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs88467317%5D&disp=P

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs22066632%5D&disp=P

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs32602458%5D&disp=P

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs31392698%5D&disp=P

    ————————–

    Here’s his page on CDE

    http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID540918&cmd=show%5Bs230149409%5D&disp=O

    Notice that when CDE was at $22 last Monday it was the same level (actually lower) than the IT bottom in February.

    The 1 minute chart today indicates some very, very heavy buying last 1/2 hour (accumulation?) and it has been doing this the past few days.

    This is a company with gold AND silver mines, a new CEO (old one was kind of a buffoon) and lots of cash and reserves.

    The issue with them has been a shitty deal they made long time ago with Franco Nevada. In order to make it through the crisis they sold Franco forward gold production to raise capital. Because of GAAP, it hits their financials in a way that they have to show a loss and they are not able to offset by increasing the value of the reserves.

    I’m not trying to preach here, just knowledge sharing. If anyone wants more facts, let me know.

    What I could see happening is the miners tread water, maybe decline a bit to shake off the overbought conditions as gold puts in its DCL or maybe even an IT low. Then, they are primed to rocket up with gold to the end of the C wave or for the A wave.

    Or maybe, the weakness in the miners was a head-fake for a gold DCL and its back off to the races….

  204. royboy1979

    W2

    I have never seen it, but I will check an episode out tonight. No cable/satellite here at the casa, just good ol’ antenna and netflix stream. I know Prison Break is the stream.

  205. Gold Lion

    RJ!!

    Really nice charts on gold miner values and CDE. Thanks for posting the links. I am long a lot of CDE since 08 lows. Some of these miners are getting very cash rich and take over targets. OGC(tsx) is a 2$ stock with $1 in cash and mining 260 to 280k oz a year.

  206. MrMiyagi

    I never will understand why anyone wants to alter their state with drugs, booze and anything else they come across.
    I feel fine just the way I am.

  207. Keys

    I have a feeling that gold will be the biggest take-out we have seen in a long time…

    current patterns.
    dollar up=gold up
    dollar down=gold up
    market up=gold up
    market down=gold up

    Any serious trader, that is not old turkey, is just waiting to exit at the first sign of panic.
    So my question is who is buying. With Cramer, a GS boy, standing all around stating buy gold, and with gold never going down…I think the answer is clear, that mom and pop, and retail Joe are buying it up.

    The more I read on this the more is sounds like oil again…which is what I got burnt by btw. Went through the Nasdaq and general market collapse up nicely, got cocky, and bought into oil 200. Watched my 90% gains evaporate in days to about a 7% gain. cashed out, and stood in shock as we tanked further.

    Worse I remember clearly oil falling, thinking okay a little profit taking, my oil stocks fell, but then oil flung forward, and my oil stocks fell more…I had no clue what had happened didn’t make sense…bought into the hype, and then suffered the biggest drop from top to bottom I have ever add due to being greedy. Anyways being burnt once, protected from the silver rise, and now although very very much earlier it would seem is protecting from the gold drop, whenever that will be.
    All this to say I think the suckers are coming in hand over fist at this point. Nobody wants pain, like drawdowns, but that is what is needed during healthy bulls. So my question is who is buying, value guy is gone, the hedge fun guy knows exactly what a parabolic move looks like….so its probably mutual fund guys soaking up commissions as novice investors come in droves.

    I am getting a better feeling about the gold bull…Need to sit tight and preserve capital, because this take-down may produce massive sales! And this next C-wave, or run, will probably be longer than the last one due to the fact that many naive Joe Publics will be buying hand over fist. Not only will they get burnt, but they will never touch gold again most likely.

    Anyways I wish people didn’t follow the lemming mentality to investing but they do. Gold never goes down, fundy support, US crap, and some gold bug fever, and no severe corrections! Gold is a for sure thing.

    Anyways count me out of any further real plays on the metal, until this market corrects nicely…even if Gary calls a long call, I may put a toy position in, but my very fragile skin can’t take getting burnt again…so my profits will be very limited for the time being…

    Divergance=yikes
    Joe public asking about gold=yikes
    extreme surge forward=yikes
    no real correction since1500s=yikes

    alright bored again…

  208. marksomething

    Gary was musing not long ago about “new” industries that drive an economy: tech, Internet, bio-tech etc… but I say the next big industry to fuel the economy is the decriminalization of pot. virtually overnight ten’s of billions will be made and if properly done the potential tax revenue could or should be 10%+.

    talk about a BULL! yahooo

  209. TZ(8155)

    We now have an up day in gold off the selloff lows last week.

    The ‘fuse has been lit’ so to speak.

    This up day wasn’t as much as I was expecting if the parabola was still in effect, but it was more than I was expecting if gold has peaked already.

    So what it really did was put stronger emotions in both sides: bulls are thinking “here we go again” (and probably buying), shorts are now a bit worried they are on the wrong side (or shorting more).

    Anyway…as I said before being vertical on gold means it has to either continue ramping ASAP or it will drop. I think we get our answer within a single day from here now that movement has started.

    I expect, either, we rally to near 1800 very quickly – which puts us in the likely ‘continuing higher for another leg up camp’ or we drop lower after suckering some remaining buyers with today’s move.

    I don’t see the indecision lasting much longer.

  210. Veronica

    Gary, my system has some elements of SAR, but it incorporates other factors also. Only a few platforms can run it, with Multicharts being the best.I don’t believe TOS or stockcharts can run it.The sell stop currently has moved back down to 1721 for tomorrow.

  211. phantom

    anyone follow clive maund, he is prediciting a huge rally in PM,s, in fact he alerted on saturday that silver will have a massive rally. doc also mentions that dollar is going to have a cycle low in the next 5-10 days.

  212. Veronica

    TZ, I’m with you. We either fall big very soon or we consolidate here and move on up more.We have a swing low potentially tonight and my system missed an additional add point to longs today by a couple bucks with a very tight stop underneath it.It’s a new twist to my system with additional buy points that greatly enhances the profit curve but does lower the overall win ratio to about 61%.

  213. TZ(8155)

    There are many examples of where metals have peaked and they have a single up day on the way down. Today could have been nothing more than that.

    But if we are still parabolic we need to spike up near the high to get longs excited again and keep the fever burning.

  214. TZ(8155)

    Essentially, we need to rally to a price soon where everybody here says “damn, I wish I was still LONG. Shouldn’t have sold!”

    Today’s rally didn’t do that which is why I said it isnt’ enough. If we can’t get a price like that then the confidence of being out will set in and the longs will weaken.

  215. Slumdog

    Gold at the current price is entering into a gap on a NY Pit daily basis. This is either breakaway or exhaustion.

    Either way, this price will revisit, assuming a last, catch all the suckers trading window.

    Thus, this area is the end for a while, imo.

  216. deshy

    Poly: Just reviewing your recent posts…trying to understand if you’re thinking gold has another (significant) leg up or are you suggesting the relatively low volume is a warning sign? THX

  217. profitzone

    Yep, my motherinlaw, is a CD holder and muni bond buyer is doing a johnny come lately and started talking about gold going up and the dollar being worthless just the other day… i can smell a near term top.

  218. Keys

    Outside a couple token plays,
    I looked at my account and noted that it was still there; so the all cash play is working 🙂 Not very profitable though, really confused by that, may need to look into it 🙂

    I am interested to see what miners do, and what happens in the market. We have a potential gap fill in the general market, do we bounce or fall further. Miners, do they follow the market or gold, or simply hover around doing nothing.

  219. Poly

    Deshy:

    I’m really looking for (expecting) a pullback very soon, into the high $1,600’s, which would mark a daily cycle low. From there, I would enter back in with the DCL as my stop, as I’m tracking a July 1st IT cycle low.

  220. Danno

    Been watching gold every single day since 2004. This is either the biggest long fake ever, or gold is about to launch into one of its super rallies. It is impossible to tell yet. Impossible. So don’t even try. You will only be guessing.

  221. PK

    From what I remember last week, GLD was nonexistent on BoW towards then end of the week while gold was selling off. Does the low volume from yesterday make anyone think that this is dumb money getting in too late?

  222. St. Deluise

    should be an interesting day for TOS users. yesterday i “lost” friday’s gains and now today my account is zero’d entirely.

    i know switching clearing houses is a complicated thing but.. actually i’m not even surprised anymore. of course everything’s going to break, it’s TOS.

  223. auger

    That sucks, St.D. It seems like they treat their software (constantly updating), as if it’s more important than peoples’ accounts/$. There should be a basic platform (no charts), for executions, when crap like this happens.

  224. St. Deluise

    need a break anyway

    check out the 1597 day SMA on SPY. think it’s a pretty fat target seeing how price reacted to it over the last few bullbear transition areas. it’s currently at 122.77. not holding my breath for much above that without any fresh greenbacks dropping out of the sky.

  225. Shalom Bernanke

    Just peeking in on prices, and don’t see anything to be done today. Too soon to add to miners, need a good smashing to buy more, or another day or two of lower prices. Leaving PHYS as is, expecting to take a hit to profits at some point, but long is the side I want to be on.

    Stay focused on the plan, and good luck. I’ll check in later but for now I intend to enjoy the great weather. 🙂

  226. Hack

    Rob L.
    Just taking some profits off of the table. Europe, US and China are reporting lower than expected growth. I’ll jump back in when the time is right…

  227. Shalom Bernanke

    Michael,

    No, I didn’t catch that. Where was it?

    I just caught up on the comments and see you wanted to exchange e-mails. If you can post yours for a minute or two, I’ll stick around to catch it and send you mine, if that process is ok with you.

    As far as miners are concerned, all we have to do is get by this next anticipated correction in gold and the general market (buying into the pullback if it occurs), and I think we’ll be set to go Old Turkey for the rest of the bull. 🙂

    Post your email if you like and I’ll save it for later when I get back to the ‘puter. You can erase your comment immediately afterward, as it’s not wise to leave your email address in public areas for too long (I think!).

  228. Michael (Hulk)

    One endgame to watch for is a failed breakout of the HUI after a tag of 610 (GDX 65) to draw in sidelined public/technical money. Recall the seminal event after which this whole leg started was a failed breakdown of HUI through pivots at 490 in June. I am finding stocks lead the commodity more often than not lately across sectors.

  229. auger

    Hulkster, that’s my line in the sand, as well. Of course, there’s a possibility that it’s support, this time around.

  230. Michael (Hulk)

    Indeed, could be support, and would resolve a key divergence although G-man would point out cycles are stretched and caution advised to see how miners deal with coming equities downdraft … I would use the mentioned breakout tagging and failing to generate a clear “GO” to exit miner trading longs, retaining long-term miner longs.

  231. discreet shopping

    William Wallace, yesterday you asked if anyone wanted john doodys top ten list- yes please! Does he still like GQM.TO? It has fallen below 200day for the 1st time in over 2 years!

    Mark

  232. wolf33

    There is still a long cycle(posted many times) that goes into October with corrections be very short—

    1800 could cause little problem than old high.

    Drag silver along to 45/6 first.

  233. wolf33

    Jeff—Someone sends them to me—I do not know make-up. I always keep aware and let technicals take me out of market. Have not yet.

    Mentioned key numbers above earlier

  234. wolf33

    Numbers above are resistance zones—I use person Pivots at this time to sell gold—They have been on buy for long time—Still are. I will risk whipsaws.

    Overweekend—-I will often hedge at least some of portfolio.

  235. Frank

    Checking the market after dinner…. well, it is clear that miners are currently following the market today, which is a shame.

    This QQQ trade has meager gains unless one perfected the timing of entry.

  236. gold silver troll

    HUI and GDX right at resistance trendline…bull trap or bear trap…i dont know…this is the BIG BEST

    if we break with volume and the come back and retest it successfully, I will buy a bunch of NUGT

  237. Slumdog

    BB wrote: “Jim Rogers supports Ron Paul:”

    And Jim Rogers lives where? Singapore? Is that in the US?

    Did Jim Rogers sell his assets in the USA?

    He’s giving advice from 10000 miles away?

    Jim Rogers, the great American.

    Nope. It’s Jim Rogers, the great self-serving capitalist.

    That means he has zero skin in the game.

    Go Jimmy. 🙂

  238. David

    Wolf33,

    If you don’t mind, I missed your Person’s Pivot Points post and can’t find it. What time frame do you use?

    Thanks, Jenny

  239. wolf33

    David

    Daily on PP
    I also look at MaCD and RSi on 120 minute

    On levels—simply said could have resistance at 1800 and old high. If we can break those without getting a PP sell—think could go up big. JMO

  240. ...at ease

    I cannot believe they would discuss cutting retirement plans on servicemen & women while they are in war zones. Start at the top, Prez, down through congress and senate and civil service before you even consider the military cuts of the servicemen & women. Once you get done with the top, hopefully they will be all back home and then you can consider theirs.

  241. Hack

    Congress has been trying to cut military benefits for 20 years now. After they drain that they’ll go after social security. Then what?

  242. Marc

    Hey Gary,

    Is there a way you could make your comments on this board in red like you do on the premium site board?

    No offense to the rest of y’all but I don’t have time to sift through all the comments, arguments, rants and please help me posts.

    Cheers

  243. Slumdog

    If you want to rally folks, buy MADE IN USA stuff. The pennies of price difference mean that the entire price stays here.

    BUY AMERICAN is bullXXit. It denies jobs to the lowest skilled labor group. Then we get unemployment, welfare, riots… you get the point.

    It’s the lowest class that’s the most dangerous. Instead of tossing the money out to the Asians, hire the lowest skilled here so they send the money here.

  244. Hack

    Once everyone figures out we’re not Europe then we can resume our rally…Bought AAPL, QLD and VIG this afternoon.

  245. David

    Wolf33,

    Thanks for your reply. I have been using the pivots on a much shorter time frame, but do not like the whipsaw that occurs. I look forward to exploring strategy with this time frame!

    Jenny

  246. ...at ease

    Slumdog,
    I try to only buy made in America or made in countries I shop in Europe for specific items made in those countries. I have angered many shop owners asking to see labels or source of purchase. I think my Grandmother taught me that back from the days she would not buy made in Japan, only made in America.

  247. ...at ease

    Slumdog,
    It is very difficult to find things made in America in the stores. You really have to do your research on the internet prior to purchasing anything to ensure where the manufacturer is located.

  248. marksomething

    maybe when American companies create and make quality products (like our grandparents gen.) then I just might. wait I will buy canadian first then American. no wait first Canadian, then European and then American. lol

  249. Shalom Bernanke

    Michael,

    I got your email address and will respond later when I get back in. Just checking the close before I step out again.

    Slumdog,

    Jim Rogers has skin in the game. He’s forced to pay US taxes no matter where he lives in the world, even if he doesn’t step foot here. You don’t like Ron Paul b/c he’s not good for Israel. No more wars or foreign aid for Israel. Some American you are!

  250. Shalom Bernanke

    It’s far too late to think buying “made in USA” will save this economy and jobs. Hardly anything is made in the US anymore. Nice theory, little substance at this stage.

    War will reset everything as always, forcing things to not only be made in the USA, but locally too.

  251. ...at ease

    Marksomething,
    You heave to research to find made in America, Canada or Europe. I tend to look for local folks in communities to ask for local merchants. Most of the elderly listen and read about more that’s happening in their communities, because they are invested and care.

  252. Shalom Bernanke

    at ease,

    Me too, when I can. It’s just that there aren’t too many manufactured goods one can buy locally.

    If you really want to help the US, vote to cut out all the wars. That will have an immediate impact on the bottom line.

  253. Shalom Bernanke

    at ease,

    I meant that are made locally. Even when something is made near home, often the parts are made abroad and it’s only assembled in the US.

    Notice how today there was talk of cutting military pensions? No talk of cutting the wars out, though!

  254. ...at ease

    Sorry SB, Can’t do that, because I believe, the only reason, we should be taxed at the federal level is for the common defense domestic, foreign and abroad.

  255. Shalom Bernanke

    at ease,

    So just say you like the wars and feel they’re necessary instead of the “sorry SB” stuff.

    Then “make aliyah” to Israel instead of of trying to send my kids to fight your wars. Simple.

    I’m outta here, never been too interested in anything you’ve said and have a million things I’d rather do, sorry. 🙂

  256. William Wallace

    at ease,

    I agree…there has been war for centuries, to think we can just “stop” now…never happen. As long as there are humans on this planet there will be wars. War is human nature, whether we like it or not. God Bless our Troops!

  257. ckpc

    WW says,
    “As long as there are humans on this planet there will be wars.”

    I believe a more accurate statement would be, “As long as there are BANKERS on this planet there will be wars.”

    It always astounds me that people believe that sending young men off to die is “supporting them.”

    Did you know that Ron Paul has received more campaign contributions from active duty servicemen than ALL the other GOP candidates combined? Perhaps we should support the troops by supporting who they pick as best representing their best interests…which is to take them out of harm’s way.

    http://www.youtube.com/watch?v=MdXLSgZXH9U

  258. ...at ease

    “Most” military and their family members are supporters of Peace though strength… not war.

    It’s a volunteer service. When you raise your hand to protect and defend, it’s your choice. Or your choice not too.

    If you want to support the troops make sure their ballots get counted, even if they don’t meet mail deadlines, which are beyond their control outside the US.

  259. High 5

    “I agree…there has been war for centuries, to think we can just “stop” now…never happen.”

    This has got to be one of the stupidest remarks I’ve heard in years.

  260. William Wallace

    CK,

    Both World Wars had nothing to do with bankers. Maybe when we sent our kids off to fight those wars we should have just kicked them in the rear and told them see ya when I see ya, instead of supporting them.

  261. JG

    Mr Wallace, so now I know your a pot smoking could’ve been Navy seal…for the 5th time…. Come on this is an investment blog not an online chatting service there are plenty of places for that. Lets stay focused on the markets and help each other avoid this financial mess the world is heading into!

    Just sayin’

  262. William Wallace

    JG,

    First of all I was replying to other comments, second I dont smoke weed because I like keeping my mind sharp and on point instead of in a fog, zombied out and paranoid. Third, maybe you should take your 4 profile views to another financial blog if you got nothing financial to say.

  263. JG

    look I don’t mean to be judgemental and maybe I was and for that I apologise.

    Lets leave it at that.

    My take on the current situation is that we’ve missed this parabolic run in gold and I could easily see it hitting over 2,000 if this thing in europe gets out of hand and could well easily do. The question is what to do now…For me I can’t bring myself to go in with gold as overbought as it is now and I’m sure many others are feeling the same frustration.

  264. MarkMarin

    JG,

    I have the same frustration per the current run in gold, so I bought a futures contract last night on a tight stop. I didn’t risk much and now have an $18 per oz profit, so I have a little piece of the action, far less than the 300 oz in futures I held until early this month.

    I do think that Garry has once again nailed a intermediate cycle bottom, this time in stocks, so am long and with profits, expecting a challenge of the 200 day ma. It really doesn’t matter where the profits come from, but as a long time precious metals and miner investor, I’m looking to re-establish several positions later this summer. BTW, still holding physical…that’s not for sale.

  265. William Wallace

    JG,

    Take a deep breath and stop worrying about catching the rest of this rally in gold, it may and may not go to $2000 before a serious correction takes place. Atleast if it goes to $2000 without you and then corrects we will be able to get back in with much less risk and still profit greatly. Stay focused on making sure your money is there after a correction so you can profit big. Its definitely hard to be patient but the reality is gold may very well not go much higher right now. Look at it this way, even if it went to $2000, there may be hard pullbacks that will take your stops out even if you try to trail. It will be impossible to catch the top.

  266. William Wallace

    JG,

    Did you not take the QQQ trade? We are not far off the entry, you still have a good entry at this point. I added on the dip today and was in the green when the market closed. If we are going to hopefully test the 200 it will be a very profitable trade.

  267. Keys

    There is no missed move…each day one has the choice to enter or get out. Even on the best of days gold only moves up 2-3 percent..

    I will assume that many are very frustrated seeing the move up and
    either being in it, not knowing if it tanks tomorrow…or being out and watching the boat sail by.

    I can understand the stess on that one, this truly is a stange moving event.

  268. MrMiyagi

    Nobody ever is going to catch entry at the lowest price and exit at the top. Ever. E V E R.
    You’re always going to miss extra possible profit. You’re going to sell before an upturn. You’re going to buy on the way down.

    The most important thing is to show a profit. 10$, 20$, 1000$, it does not matter. You will think a long time about lost money than potential profit.

    For those moaning about missing the gold run, I assume you’re still of the mind that it will run. Go ahead and buy some then, no one is stopping you. No one forced you to sell either.
    Gold may keep going to 1900$, 2000$, join along for the profit. Gold may also go up 20$ and go down to 1700$, 1600$. What’s your decision? Can you make one for yourself without pointing fingers at others?

    This is an analysis service that benefits many and furthermore this blog with its differing points of view and poster’s analysis should benefit anyone even further but the bottom line is; you are the one hitting “ENTER” on your buy/sell orders.

    By the way, I grew up in Lebanon and war is not fun, people dying around you, kids, mother, fathers, that is not a bonus in life. There will always be wars because humans are assholes for the most part and that’s the end of it.

    Back to the basement…

  269. Hack

    I’ll have to admit the gold for QQQ trade was one of the biggest mistakes I have ever made even though I made money on both ends, but I also took a lot off of the table. I won’t make that mistake again.

  270. 86d4life

    Eamonn,
    As long as we`re taking a break from the political infighting, why don`t you drop the steamy details on us Dawg. I mean Horse. Lol.

  271. marksomething

    at ease

    the only thing I would buy American these days is a tesla motors car. the sedan is coming out next year and because I’m now a family man I have to sacrifice the spots model. I still have my Japanese motorcycle tho. lol

  272. rowlin

    I try to buy American, but it can’t be done a lot of the time. I don’t mind buying from a free trade country, but I try to avoid anything from China since they manipulate their currency to try and destroy industies in other countries so you have to buy Chinese crap.

  273. 86d4life

    1. After many years, I have come to the conclusion that one useless man is a shame, two are a law firm and three or more are a legislature. (John Adams)

    2. If you don’t read the newspaper you are uninformed; if you do read the newspaper you are misinformed. (Mark Twain)

    3. I contend that for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle. (Winston Churchill)

    4. A government which robs Peter to pay Paul can always depend on the support of Paul. (George Bernard Shaw)

    5. A liberal is someone who feels a great debt to his fellow man, which debt he proposes to pay with your money.

    6. Democracy must be something more than two wolves and a sheep voting on what to have for dinner. (James Bovard, Civil Libertarian)

    7. Foreign aid might be defined as a transfer of money from poor people in rich countries to rich people in poor countries. (Douglas Casey, GeorgetownUniversity)

    8. Giving money and power to politicians is like giving whiskey and car keys to teenage boys. (P. J. O’Rourke, Civil Libertarian)

    9. Government’s view of the economy could be summed up in a few short phrases. If it moves, tax it. If it keeps moving, regulate it and if it stops moving, subsidize it. (Ronald Reagan, in 1986)

    10. I don’t make jokes. I just watch the government and report the facts. (Will Rogers)

    11. No man’s life, liberty or property is safe while Congress is in session. (Mark Twain, in 1866)

    12. If you think health care is expensive now wait until you see what it costs when it’s free! (P. J. O’Rourke)

    13. There is no distinctly native criminal group in America other than our politicians. (Mark Twain)

    14. The inherent vice of capitalism is an unequal sharing of the blessings. The inherent blessing of socialism is an equal sharing of the misery. (Winston Churchill)

    15. The only difference between a tax man and a taxidermist is that the taxidermist leaves the skin. (Mark Twain)

    16. What this country needs is more unemployed politicians. (Edward Langley, Artist, 1928-1995)

    17. A government big enough to give you everything you want … is strong enough to take everything you have. (Thomas Jefferson)

  274. SF Giants Fan

    Mr M

    Your comment was spot on. Everybody gets it right after the fact but Real time decisions are the most difficult. I sometime wish we were all in a room face to face a then see how much finger pointing would be going on.

  275. auger

    Hack, if making money on both ends of a trade, is the biggest mistake you’ve ever made, then you must lead a pretty blessed life. Can’t say I feel very sorry for ya! 🙂

  276. Hack

    Auger: that was not a wise trade for me, I got sidetracked selling a winner in exchange for chump change. Luckily I made up for it by buying into the market with both fists last week near the low. However I see problems this week so I am reducing exposure. France and Germany kicked the can down the road today and that is not good…

  277. auger

    Hack, I’ve been down that road, one too many times, unfortunately. Your timing has been good on the trades that I’ve seen you post here, thanks for clarifying your thinking.

  278. Keys

    Wow am I bored! Can we get an online SMT game site going here maybe…maybe play checkers or chess against each other.

    Drugs, Israel, War, Religion. I think the only thing missing is gay marriage and abortion and we are all set. 🙂

    Alright good-night all…hopefully something happens, beyond the same as yesterday.

  279. coolkevs

    A dollar update from Kevin Depew at Minyanville who uses DeMark indicators:
    QUARTERLY: We have the long-term buy in place from January 2011 to December 2013 (12 quarters) but bullish price flip has not happened yet. (bullish price flip is a higher close than 4 quarters earlier). However (and I did not know this), we have TD Propulsion DOWN active and qualified with a target of DXY 64.6
    MONTHLY: We are on bar 3 of a 1-4 BUY Setup that occurred in May (while every other thing that reacts negatively to a strong dollar is on a SELL). TD Propulsion DOWN is also active and qualified, having a target of DXY 64.6 as well.
    So, this 64.6 fits with a Dollar Collapse scenario that Gary has espoused. Depew uses “scare” in quotes, so he’s not too scared 🙂
    72.5 – that was also a deferred Sequential from a long time ago. It’s still there, but I did not know about these qualifications of the MONTHLY and QUARTERLY levels with a target of 64.6. As I don’t have access to DeMark screens personally, how could I know? I’m sorry if I have been banging hard on my DXY 72.5 drum – 64.6 seems to be the new level of exhaustion.
    WEEKLY: TD Sequential 13 Signal has expired and are on bar 5 of a potential 9-13-9 BUY signal that record in September.
    DAILY: A TD Sequential BUY signal from July 26 has expired and produced an OK bounce, but not as much as you would expect with the markets down so much.

  280. NJ

    DG:
    Congratulations on the Series 65! Fantastic news.

    TZ,

    You sure nailed it – been tough watching gold go up $20-25. However, given the extreme stretched cycle and sentiment, I am sitting out on Gold.

    Thanks Gary, TZ, DG, Alex, Poly and several others for sharing all your experiences!

  281. JG

    WW, thanks, yes I took the stock trade and no I won’t be chasing gold at this stage as you are correct I’ll just keep on getting whipped sawed and only catch the top. My plan is wait for the correction and then go all in cold turkey! with 3 kids a wife and a job I’ve no mental capital left over to try and be trading this thing!

  282. Dubbelito

    JG,
    If you are so anxious to get on the gold bull and stay there, how come you didn’t go old turkey back in July when the intermediate bottom was in, as per Gary’s call?

  283. Danno

    Keys,

    Here is what’s really going on:

    – World oil demand is outstripping supply

    – Saudi Arabia has lied about their proven oil reserves. They are currently injecting water and other substances to force oil out of the ground (the last gasp before decline)

    – The USA desperately needs oil

    – Without more and more oil the USA cannot growth

    – Because supply cannot keep pace with demand, the USA will not be able to keep growing

    – Once the market figures this out the market will collapse

    – Oil will continue higher, with or without the USA

    – Iraq will become the world’s economic super power. It is the only place left on earth with large quantities of easy to pump oil

    – Germany will rise again to become the world’s military superpower

    – Iraq will be completely destroyed

    – The Battle of Armageddon will occur in 2060 or later, but not before (per Isaac Newton) and it will most likely be a battle for oil as speculation suggests that oil will finally be discovered in Israel

  284. JG

    Dubbelito,
    Really, I wasn’t aware I thought Gary sold all his gold positions before this parabolic run really got started so if you were following him then you should have no holdings either?

    Can I ask you what are the current gold positions in the modle portfolio?

    For all the talk of old turkey the reality is we are practicing selective old turkey…

  285. Danno

    I’m so tired of people calling the latest gold rally a ‘parabolic’ run. Years from now it is going to look like a mouse fart. And it’s not even close to what silver did ending in May, 2011.

  286. JG

    Danno, ok then latest ‘C top’.
    Also regarding my previous posts just want to make clear my frustrations are not with Gary but with myself.

  287. Danno

    JG,

    It’s cool. Personally, I wouldn’t go long a bear market and I wouldn’t go short a bull market but that’s just me. Getting too fancy has not served me well in the past.

    The AAA downgrade might be blown off for a while or this bear market might decide it really was a game changer and this rally could be cut short.

  288. NJ

    I have some questions regarding the Margin hikes:

    1. Are these hikes permanent?

    2. Are margins always increased and never decreased?

    What scenario would cause a margin decrease?

    3. If these hikes are permanent, don’t all Longs now have Deep pockets and are big money guys who will not be easily shaken out?

    Thanks!

  289. Danno

    According to my charts a stiff round of profit taking should have hit gold on Monday. The strength over the last two days was unexpected. It may not last, but it also could signal a sideways move (correction over time) instead of a sharp pullback. Guess we’ll see.

  290. Éamonn

    “The rise in gold is expressing the mistrust in governments, central banks, and currencies” Felix Zulauf
    Can gold correct $100 or $200? Sure, any time. If it does, buy more” Felix Zulauf

  291. Keys

    Danno,

    In terms of oil it is tricky. We keep hearing about peak oil, but I think we draw incorrect conclusions about it. Peak oil refers to ease and availability of oil….The cheap above ground oil is done; now it is oil sands and deep water oil. These new discoveries are much more expensive and therefore have a higher cost. The marginal cost for oil is increasing…I haven’t followed oil too much lately since it lost it value play, but the marginal cost of oil was around 70-80 a barrel.

    War for oil has been going on forever, nothing new on that one. My point about oil, is that if the marginal cost of oil were ever to rise to the point where it was greater than what an economy can afford we have some real problems.
    Price 145, then now 120…at the next go 100?….at the one after that 80?

    If the marginal cost is greater than what people can or are willing to pay, we will find ourselves in a weird situation where oil is priceless and useless at the same time.

    In terms of Armageddon by 2060, I will leave that call for brighter minds than my one…these days I can barely project out 3 hours much less decades. I would however believe a stronger move would be made against Canada first. The oil sands show much more promise, and the US surrounds Canada so it would be an easy take-over. Now a take-over could be a military action, but most likely if desperation were to take place, firm negotiations would rather take place ie a lop-sided deal.

  292. Gary

    It does seem like it will never correct again doesn’t it? But that’s right about the time that the last buyer buys and then there is no where to go but down.

    Gold will eventually put in a daily cycle low.

  293. Shalom Bernanke

    I have no idea where gold is headed in the short term, with momentum higher but also due for a DCL.

    It’s also possible the pullback starts from a much higher level and only pulls back to current prices.

    I’m still long the same things with same amounts. Didn’t do any buying into yesterdays weakness, either.

  294. Poly

    Yeah we’re way overdue and this last 3 days is far from convincing, IMO. A good, quick $120 drop here will break the trend line and the 20dma and in the least, confirm a DCL.

  295. auger

    The PM/market inverse relationship has changed, here as well. Not sure what that signals, exactly, perhaps nothing more than options expiry. Keeping an eye on the dollar, here though.

  296. Movax2

    “Now a take-over could be a military action, but most likely if desperation were to take place, firm negotiations would rather take place ie a lop-sided deal. “

    No need for that.(Military) There would just be some kind of propaganda convincing everyone that whatever the governments/corporates had decided was the best for everyone. Wars only happen in areas where the propaganda doesn’t reach.

  297. Keys

    I ain’t buying, but I am wondering if gold won’t correct until the market does. Go from negative correlation to positive correlation. Either long or short and you are in the words of our coach…”asking to get your teeth kicked in”

  298. Frank

    There is a very big difference between a DCL and a so-called D wave…..

    I agree with Shalom’s observation. He must be nervous now that Gov. Perry accused him of treachery…. I mean treason.

  299. Shalom Bernanke

    My hunch is we still have a month or so (into late Sept) of sideways to lower action that should present a good oppty in metals and miners.

    We’ll see, but I cannot afford to be on the sidelines entirely. Those on the sidelines parked in cash should not forget it’s dropping as we speak. I can’t stay in confetti that’s getting hollowed out daily. 🙂

  300. Keys

    SB,

    I think we are all hoping for a pull-back, we are in the unkown right now…even if one really believed that gold was going to 2500 and were convinced of it on this run, it would be hard to buy right now.

    Both bear and bull think gold needs to correct…so why doesn’t it…pttt…wait and see and twiddle thumbs I guess.

  301. Dubbelito

    JG,
    I know that there are no gold in the model portfolio nor in my own. I left the gold choo-choo train around 1620 with a healhty profit and I honestly don’t feel too much regret of missing out.

    I did what felt right at the time with all facts on the table and if I do that 10 times then >6 times out of 10 I will have made the correct call.

    It’s just, I get the feeling that you’re itching to hop on the ever-glorious gold train at a stage when it is looking it won’t ever correct. How did you feel about gold when it was around 1500$? Were you willing to go all in and go Old turkey back then?

    I mean no offense and it is not any criticism, I’m just curious about your emotions and how they affect your decisions.

    Lord knows I let my emotions best me more often than what I would like in the stock market, but I’m working with it and it helps to do some introspection when you take decisions.

  302. Blindweb

    I’m still holding the theory that the middle phase of the greatest bull market in our lifetimes isn’t going to end with that puny parabola we saw in July.

    I bought some slv for kicks yesterday morning. Holding gld and miners. Reduced my position considerably in the $1700s.

  303. Frank

    Pardon my general ignorance of cycle theory, but is it not possible that Aug 12 was a DCL for gold. The last low was July 2.

    I understand that DCL periods are approx one month in duration.

    It also looks like you get more frequent DCLs when the market is flat or trending down.

  304. Dubbelito

    Todays current Dollar low (73,452) was 0,03 away from penetrating the July low of 73,421… If it doesn’t go through that and instead goes higher that will be one close mother funker.

  305. St. Deluise

    volume rug’s been pulled on /nq, on way to test yesterday’s lows at 2163

    i still like the long trade but i’m still expecting a good scare to the downside.

    TOS has officially frozen any trades i could possibly make though. what a mess. back to forced vacation..

  306. Gary

    Sentiment trader noted today that volume in the Rydex tech funds has shrunk to the lowest level since 2008. That has signaled aggressive rallies even in the bear market.

  307. St. Deluise

    i guess what i mean by volume is “effective volume” which is essentially a total sum of down volume and up volume. currently there is less in the Q’s than there was at yesterday’s low.

    not perfect but what is?

  308. Hack

    Let’s face it, the market is broken. Tech is not the place to be in August or September. Time to regroup and rethink the strategy here…

  309. Strat81

    Gold chart looking awfully similar to the the pre-crash Silver chart. Volume spread shows clear signs of distribution. Of course any news event in the next few days could invalidate it.

  310. Gary

    I’m just using past intermediate bottoming tendencies. They don’t typically test the bottom, especially in bear markets. Not to mention we already tested the bottom last Wednesday.

  311. St. Deluise

    auggie, tick charts anchored to the hourly.

    if anyone else is curious, here’s the basic thinkscript code. one could also google “pascal willian effective volume”. good for seeing what the big players are doing.

    def hi = max(high,close[1]);
    def lo = min(low,close[1]);
    plot EV = TotalSum( volume * (close – close[1]) / (hi – lo) );

    where “close[1]” means the previous bar’s close

  312. Gary

    No trader with any experience at all would short into this kind of oversold conditions.

    If it wasn’t still too early I would say we saw 4 year cycle low type conditions last week.

  313. Michael (Hulk)

    It’s the end of August folks and trading desks are manned by second stringers who try to run it between the 40 and 60 yard lines to make a contribution. Sustained sell-offs rarely come when the world is scared and short with many having used nearby Aug 19 and Sep 16 options strikes to express that view. FX, oil and copper not participating in this mini drip-drip – classic blatant bear trap for shorts here.

  314. Harry

    W2, as Gary said, it takes a little work to turn a steeply dropping 10 DMA. I suspect that we are just consolidating here for another day before heading higher.

  315. MrMiyagi

    Strictly from a technical point of view, QQQ has had 4 days of consolidation-type moves and SPY has had 3. The consensus is that after a consolidation the breakout should be to the recent move direction, in this case the upwards move.
    GLD has formed (so far today) a Doji candlestick but the previous one didn’t do what was expected and continued higher.

    So in other words, technically it is set up Market up Gold down but in reality it might mean jack shit.

  316. MrMiyagi

    I’m going to guess that QQQ/SPY is not going to hold for the rest of the day, maybe even the next couple of days.
    There is nothing but negative economic news on the front.

  317. NJ

    I may have missed it, but I do not recollect seeing any large BoW on SPY near this IT bottom, Instead there were large SOS on SPY and big Tech 2-3 days last week right after the bottom…

    Heck, Gold is the only thing looking strong!! As Keys said, Gold should subscribe to SMT so that it knows a correction is due! 🙂

  318. wolf33

    FYI only—just reporting.

    This is day 34 of long cycle. Usually gold corrects into day 34. If it does not(jury out) perhaps we might take out Sinclair 1800 and the biggie 1817.60 and then off to the races.

    Again I get this second hand and strictly sticking to Persons Pivots which has had a long run.

    PP went to buy 7-5 and still there, for now.

  319. William Wallace

    Maybe gold is setting up to roll over by the end of next week, miners could catch up and correct the divergence before gold dips into a DCL, then we can all jump in and ride to $1900 like a bunch of happy gold diggers.

  320. Adam

    Gary says: “Bulls might be reluctant to buy but no sane person would be shorting here other than for a day trade.”

    Tim Knight says: “I have ninety shorts. Zero longs. And many more shorts to come.”

    The good news is that there is no consensus.

  321. wolf33

    option activity favors GLD, auy,abx
    etc over spx. this I get from same person. Do not live by but could miners break out of their SLUMP.

  322. auger

    Wolf, ok I’ll bite. What is the method for using PP’s for buy/sell strategies? Was it the monthly S2, that triggered the long?

  323. auger

    Adam, Tim Knight is a day trader. Sometimes, he’s a minute by minute trader. He has a very aggressive style, combining size and calculated entry/exits/stops, and he scans the market, for shortable charts.

  324. abc

    Hello everybody.

    I have a question. Many people mention sometimes about “buying on weekness” or “selling on strength” and then post a link with a table which doesn’t tell me anything…

    I always interpret it as large volume when stocks go down (BoW) or go up (SoS). It is correct? Can somebody explain it to me?

    Thanks!

  325. Daniel

    I expect it to bottom sometime next year!! That DOES NOT mean I think prices will accelerate much. Probably a long basing pattern after the bottom!! Who knows??

  326. Adam

    Auger,

    Nah. My handle on SoH is Scalded Chimp. I don’t frequent the comments very much, but I check out the posts pretty frequently. My presence has diminished because my trading style has changed.

  327. Michael (Hulk)

    abc,

    I don’t want to be the one to break the bad news about Santa Claus, but I suggest that the data for BoS and SoW mean little in isolation. Admittedly SPY and GLD are quite big. But they often generate a figure of a paltry -$100 mn or +$100mn or so for the day, while on the same day billions of $ MORE traded at bid vs offer or vice versa in the futures market. $100 mn is a pittance compared to the size of the futures market. Think about it like this – one major active hedge fund manager that had to release his data for regulatory reasons and managed a multi-billion dollar fund was found to have turned over his fund 56x, yes 56 times, in just one month of 2008 (that’s turnover divided by size of fund).

    Gold futures and cash markets do roughly at least 20x the volume of GLD on any given day for example. The BoW or SoS may not be representative of what the big money was doing in the primary markets.

  328. Le Fou

    Gold’s Newest Believers
    Last week’s market turmoil converted some skeptics. But could it signal a bubble?
    By JONNELLE MARTE

    Los Angeles couple Chantay and Conrad Bridges have been on the fence about buying gold for years — even as the shiny metal was notching new highs. Their reason was Investing 101: They didn’t want to buy high and sell low. But recently they’ve changed their minds, deciding like many investors that gold still has plenty of upside. “The dollar is losing its value and if we’re going to do it we might as well do it now,” says Chantay, a real estate specialist. “Even though gold is high it will get even higher.”

    Call them gold’s newest converts.

    Read the rest here:

    http://preview.tinyurl.com/3jwko4n

    Good Trading,
    Le Fou

  329. Adam

    haha I’m around. The chart pattern trading is OK, but my analysis has evolved considerably thanks in part to the cycle analysis Gary & Doc provide. It’s so hard to find anything worthwhile on cycles. I’m going to be taking Level 3 of the CMT this October and I still haven’t seen anything useful in the curriculum about them other than “yeah, they probably exist”. Connie Brown seems to really value her work on Gann. I’m intrigued by that.

  330. Hack

    I’ve dumped everything that broke through yesterday’s low. Upping my cash position while keeping my strong hand. MCD, AAPL, XOM, DGP

  331. wolf33

    Poly—runs 60-70 days bottom to top with no big corrections in gold. i just want to be aware—use technicals to move on. started 7-5

  332. Danno

    Keys,

    Matthew Simmons was found dead in his hot tub. We are conducting 3 simultaneous resource wars (Iraq, Afghanistan, Libya) and we are making noises about starting two more (Syria, Iran). It is all about oil my friend. We are merely seeing a pause before the real thunder storm.

  333. Gary

    T,
    “TO MAKE MONEY from said advice.”

    Almost every trade we’ve made has made money. Even the late exit in silver made money if you entered when I did back in the fall.

    Not once did the model portfolio go short silver. When the market started acting poorly yesterday we exited the QQQ trade for a profit and completely sidestepped today’s decline.

    Unlike 99% of all other analysts, torreo included, I got you out in time to avoid the entire bear market move.

    We are making money in a very tough environment, what more do you want?

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