DOLLAR TEETERING ON THE ABYSS

We all better hope I’m wrong on this one, but I think the CRB just put in its three year cycle low in October. I’m also afraid that Bernanke has done irreparable damage to the dollar. If I’m right about both of those assumptions then we are on the brink of a historic inflationary period.

I’ve marked the major three year cycle bottoms in both the CRB index and the dollar in the chart below with blue arrows. (Actually the CRB cycle tends to run about two and half years on average.)



The dollar is now a great risk of forming a left translated three year cycle. A break below the October 27 intraday low would initiate a pattern of lower lows and lower highs of an intermediate degree.That is usually a sign that a major cycle has topped. If the dollar’s three year cycle has topped after only five months we will be at great risk of a severe currency crisis in the fall of 2014 when the next three year cycle low is due.

Even more concerning is if the CRB cycle has bottomed. If it has then commodities are poised for a huge surge higher during the next two years as the dollar deteriorates.

The next two weeks are going to be critical for the dollar. It must hold above the October 27 low. Failure to do so would indicate that the cancer has now infected the currency markets, most specifically the US dollar.

If this scenario unfolds it has the potential to drive the bubble phase of the gold bull market.

355 thoughts on “DOLLAR TEETERING ON THE ABYSS”

  6. RJ

    Gary,

    I posted this on the weekend report but didn’t see you reply, on this topic.

    Is it possible that the USD just chops around or does it have to either go up aggressively (out of 3 year low) or dive aggressively (LT 3 year cycle)? If it does chop, what would you think that would mean for gold and equities? Chop as well?

    I’m just too young to understand heavy inflation and really cannot see $10 a gallon gas in the next 2 – 3 years.

    If the dollar does roll over like this, what would your hypothesis be for a gallon of gas in 2014?

    Thanks a lot.

  8. Driver

    Thanks, Gary.

    As I posted earlier, my charts agree with your assessment of the dollar going lower. Daily lower & weekly lower.

    Are you about ready to look for your new home in Australia/New Zealand?

  9. BBPOINT

    Gary,

    In the next two weeks , depends of how the dollar and the CRB plays, do you thinks it’s time to get some bullion or physical as part of the portfolio ?

  11. RJ

    Copper up 10 cents. Silver up 8 cents.

    If copper is a leading indicator and this sticks, Gold should have a nice pop this week.

  12. catbird

    Gary,

    Oil has outpaced gold by a substantial amount since October 1 or thereabouts.

    If the next 2 weeks confirm that the CRB has bottomed, might you consider taking a position in USO or some such ETF? The CRB can’t fly without oil going to the moon, can it? Gold is only 6% of the index, tied with soybeans and several others. Oil is 23%.

    I know you often say oil is a has-been, but I can’t ignore its recent outperformance so I had to ask this.

  13. Driver

    Anyone,

    I thought the method to receive text messages re. Gary’s updates would be on the site, but I couldn’t find it. Could someone please remind me on the text to send whereby I could receive those updates? Thanks.

  15. Danno

    I have absolutely no idea what is going to happen but I will share a few thoughts I’ve had…

    IMO the dollar looks eager for its last hurrah in the sun before the tables are turned and Europe moves into pole position to dominate the world. They will milk this ‘crisis’ for all it’s worth until their ducks are in a row. I’d give it another 6 months to 1 year.

    The dollar low in May was quite a low. Since then the dollar has been consolidating.

    Israel is key. When will they attack Iran? That event may finally prompt the USA to pull support from Israel, especially if they use a nuke. Pulling support from Israel will seal the USA’s fate. Israel must be 110% confident that it can stand alone. My guess is that they will wait until the last possible moment. So there is still some time left. Iran is not quite there yet.

  16. Gary

    The dollar has basically been chopping back and forth for the last three years even though we’ve had some big moves in both directions.

    One could make the case that the last three year cycle was nothing more than a big consolidation in an ongoing secular bear market. If that’s the case then the current three year cycle should see the dollar put in another big leg down.

  17. Gary

    BBPOINT,
    The only reason to buy bullion would be if you think we are at risk of hyperinflation in the near future.

    That’s unlikely to happen until at least 2014 so there’s no great urgency to buy physical and deal with the large spreads associated with that market.

  19. Gary

    Cat,
    It’s probably too late to jump on oil now. Once everyone has noticed the outperformance then it’s usually too late. You need to buy an asset before the move starts.

    Personally I think it’s time for the mining stocks to deliver a huge surge to the upside. So rather than chase oil, which has already had its move, I would rather stay invested in the sector that I think is going to produce the next big move.

  20. SF Giants Fan

    Very bold statement and many here are on the right side of that trade. However, it seems something always comes out of left field that changes things.
    It’s like big Ben is reading this blog and goes ” oh yea, I don’t think so”

  22. SF Giants Fan

    PM manipulation talk is a waste of time.

    Now how about our US congress and house of rep trading on proposed bills, laws and appropriations. Many behind closed doors. Frigging insider trading.

    Watch tonight’s 60 minutes and watch nancy paloski and others squirm and dance around the questions.

    We have the best government money can buy

  26. Driver

    …at ease,

    I looked at that link but it’s for emails. I was looking for the way to receive text messages.

    BTW, no on your question re. gold & silver, but golddealer.com is a good source.

  27. ...at ease

    Driver,
    Thanks… I signed up for a twitter account, searched for Gary Savage and selected to follow him.

    I also understand you can text message on your phone
    follow garysavage1
    to 404040

  31. Bullion Trader

    Gary,

    You had said for new purchases at this point (especially if one is not invested yet) would be to wait for a swing to form (not sure if it was on gold or the dollar). That was late last week. Has this occurred and would now be a good time to enter initial positions? Thanks…

  37. Shalom Bernanke

    I’m not using the USD index to determine what I do with miners, but if I had to wager on the confetti, I’d bet this observation of Gary’s is most probable:

    “One could make the case that the last three year cycle was nothing more than a big consolidation in an ongoing secular bear market. If that’s the case then the current three year cycle should see the dollar put in another big leg down.”

    People sitting in cash will get stung eventually, and if they cannot get invested now they are kidding themselves that they’ll flee the USD into gold when it’s $2,500 or more. We’ve seen people follow gold for years, while never taking much profit from the bull.

  41. Danno

    “Merkel Says Europe Facing Toughest Crisis Since WWII.”

    Why would the EU’s most powerful leader make such an explosive comment if the if the worst was over?

    Because the worst is yet to come.

  42. Shalom Bernanke

    Danno,

    Of course the worst is to come, all around the world. Focusing on the dollar vs euro is taking your eye off the ball, IMO.

    Your thoughts on the confetti vs confetti should not affect your outlook on metals. Only thing I care about is gold vs. dollar.

  45. Blog Posts - RNM

    Isn’t this the complete and total opposite of what you’ve generally been suggesting over the last few months Gary?

    I thought 2012 was to be a complete and total “depression” and one of the worst years we’ve ever seen.

    Commods up?….Stocks up no?…dollar down? stocks up no?

    I am interested in what factors could have turned the tables in your view – so drastically?

  46. Danno

    SB,
    Now you are talking about things you know nothing of. I have only mentioned one trade of any real size on this board. You have no idea what I’m doing right now. But go ahead and keep shooting your mouth off if it makes you feel like a big man.

  48. Gary

    blog post,
    That has always been conditional on the dollar rallying out of its three year cycle low.

    If Bernanke aborts the dollar rally then 2012 is going to be a bad year, but it will be a bad year because of surging inflation. 2013 and 2014 will be even worse.

  49. Shalom Bernanke

    Danno,

    You were the rude one, and I stand by my point. You’re hanging around making inane predictions when you can’t even make $10 to try out Gary’s service.

    Aren’t you the same clown that was long silver and long the leveraged silver short etf at the same time as a “hedge”? Ridiculous.

  51. Danno

    SB,
    I still own AGQ. I hedged with ZSL. That hedge did not perform well, but by hook & crook I sold/bought/sold ZSL several times and also sold AGQ covered calls several times. That trade is now nearly break even, but I admit it took a lot more work than I thought it would.

    I don’t think disagreeing with Gary is the same as insulting Gary. I see a lot of guys insulting Gary on this blog and I don’t think that’s right.

  53. Shalom Bernanke

    Danno,

    You need a nap. Who said anything at all about insulting Gary?

    Try and think a little before you speak. I didn’t ask what trades you have on, either. I could not care any less.

    Now get back to that amazing analysis of yours and let us know what you come up with. 🙂

  54. Blog Posts - RNM

    Thanks Gary.

    I too ( in trading currencies only) see this recent “dollar action” as a bit unsettling.

    And yes….the move off the bottom has been quite slow with little conviction – but – still heading in the right direction as per most of my charts (however choppy) with several ‘daily closes’ now above the 200 SMA now (barely) turning upward.

    So….ya….they suuuuure arent makin it easy – and as you;ve suggested the next couple weeks should be very very telling.

    I imagine some kind of “big news” out of Europe (perhaps China stepping in etc…) would likely seal the deal (as we’ve recently seen – markets wanna go up up up like mad once this is over with) so……onward.

  55. Blog Posts - RNM

    Thanks Gary.

    I too ( in trading currencies only) see this recent “dollar action” as a bit unsettling.

    And yes….the move off the bottom has been quite slow with little conviction – but – still heading in the right direction as per most of my charts (however choppy) with several ‘daily closes’ now above the 200 SMA now (barely) turning upward.

    So….ya….they suuuuure arent makin it easy – and as you;ve suggested the next couple weeks should be very very telling.

    I imagine some kind of “big news” out of Europe (perhaps China stepping in etc…) would likely seal the deal (as we’ve recently seen – markets wanna go up up up like mad once this is over with) so……onward.

  57. Razvan

    i see a little sparring going on today…must be due to the market’s lack on action!

    Danno, why would you hedge your silver position? if you enter a position after a significant bottom you have to give your position a chance to run.

  59. Danno

    Razvan,
    I bought AGQ at $239 (before it split 2:1). I knew it was risky, so I hedged with ZSL instead of putting in a stop loss.

    Dan,
    You could have made a boat load of money on my USD head & shoulders call. Even drew a picture.

  62. intelliblue2000

    SB – I read all your posts, you don’t seem to think there is a tight connection between gold and USD. What do you watch for gold’s action? Just gold futures? Commodity index? Just picking your brain, not being argumentative. Thanks!

  65. Shalom Bernanke

    intelliblue2000,

    Sure there is a connection between the dollar and gold, as one is purchased with the other. It’s the focus on the USD index that throws people off, as the index is just the dollar vs other confetti.

    We’ve already seen the USD index and gold move together in the same direction enough of the time that focusing on the index provides no edge. One has to predict where the USD index is going, THEN also guess if the index and gold will move together or inversely. Too many moving parts to provide a reliable edge.

    For example, the USD index might rise in a “flight to quality” but gold might go up for the same reason. The way I see it, gold is going up vs the actual dollar (not the index) and that’s all I need to know for the trade. In short, the USD index is not the dollar, just a measure against other flawed currencies (not gold).

  66. Shalom Bernanke

    Of course, there are times that the USD index will rise and gold will drop, but correlation is not causation.

    I also would guess we’ll see less of this typical relationship as the bull market progresses. Eventually, all anybody will care about is price of gold in their currency, totally neglecting the USD index.

  67. intelliblue2000

    SB – thanks for your response. What do you watch for the USD? Many times I just pick a few currencies against USD, watch those to get a sense of the relative value of USD.

  68. Shalom Bernanke

    intelliblue2000,

    For the last year I haven’t paid much attention to the USD index. I’m focused on metals/miners for now, but if I were trading currency, I would most likely trade only pairs.

    We might even see the USD index just meander around in a wide range for years, while commodities rip higher. If each central bank prints the equivalent of $2 trillion in their own currency next week, the index would stay the same, but the action would be very positive for gold with so much more confetti out there. 🙂

  70. Shalom Bernanke

    I think they will, maybe not from this moment, but certainly from these levels.

    I’m leaving Wed for 18 days(+/-) vacation and my ideal situation would be to return and see the $HUI around 570, so that I could add more. A week or two of sideways drift would be alright in my book. If they just rip from here, I can live with that too, but I’m no longer at all concerned about a collapse into the end of the year. Patience will be rewarded as long as we don’t force an error by watching every wiggle. 🙂

  73. Shalom Bernanke

    Thanks intelliblue2000, but I’ll have a computer to check in on quotes and maybe place a few orders here and there.

    Bullion Trader,

    I suppose it depends on how much you already own, if I didn’t have any I would nibble but since I’m closing in on my total % risk I’m willing to lose, I’ll wait to add into a good shock lower. Maybe two good size down days in a row, or an oversold stochastic on the daily charts, something like that.

    As far as a price on GDX, I’d be happy to pick some up if it pulls back to the 50 MA around $59+. If that were my first purchase, I’d plan on giving it plenty of room (smaller position) to avoid any shakeouts. I’d put my stop $6 below my entry point.

  74. Shalom Bernanke

    BT,

    Also, this is a longer term “trade”, hence the very wide stop. It depends on what your expected hold time is.

    If I were day trading, I would not buy here, but since we’re looking several weeks out at least, best to give it a lot of room. 🙂

  75. Gold Lion

    SB, LMAO

    “You were the rude one, and I stand by my point. You’re hanging around making inane predictions when you can’t even make $10 to try out Gary’s service.”

    Danno, you should listen to SB. He knows of what he talks about.

  76. Sleeper

    I’m looking at the 3-month daily chart for GLD. I try not to read too much TA into them, BUT dang, it sure looks like a cup with handle forming on lower volume. I am hoping for one more push higher before the DCL… Maybe I should just back off on the koolaid.

    Anyone else?

  77. David

    The more blogs I browse, I get the sense that most are short the S&P or are looking for Europe to spell the endgame for stocks. BOW number creeping up today.

  78. sophia

    David,

    I agree with you….Dax is not selling off as much as it used to, Cac40 holding pretty well considering, so are we too pessimistic?

  89. MarkF

    Hey Danno,

    I think 50 million abortions performed in this country sealed USA’s fate, not whether we support Israel’s corrupt regime, if they decide to get us into another war. Bibi Netanyahu is going to reap the whirlwind.

  90. wolf33

    rally should start yet this week. some cycles i see point to this. everything is a risk but these are fairly high probability. so was buying little weakness today like dba few others. not going wild.

    do have stops.

  91. TZ(8155)

    RAZ,

    My posts hang in for about 3 seconds and then google removes them as spam. It’s a crap system here. I think i need gary to ‘unspam’ my comments and then google won’t keep doing that (just like how the email systems work).

  92. Liquid Motion

    Gary,

    Finally we are singing from the same hymn book.

    Damage done (USD)agree…inflation is without doubt a very big part of our short – medium term future …agree.
    Gotta watch the downward trending channel on the CRB though,which has been the move for the better part of this year. For your theory to stand ..then it will need to breakout to the upside of that channel…..???

    Miners are the place to be. The analysts have them priced using $1200/oz metric. Still unloved but soon to be in high demand. Watch the HUI. It will outpace the CRB and GOLD if they both turn up. My best guess is somewhere north of 50% increment. The Q1 12 will tell all.

  93. Visitor

    My guess is we will see weakness next week with options ex. on 22nd. With Thanksgiving also that week, probably a raid and a chance for those here looking for a opportunity to get in.

    BTW – I don’t understand Gary’s thesis of not owning physical now, see his quote below. What do you think spreads are going to be like when everyone’s trying to get in? Events happen that you or I can’t predict. Thinking you can time a physical purchase is crazy. It’s like buying emergency supplies in case of earthquake or other disasters. The time to buy is before the event. Doesn’t hurt to own some, especially if you believe in the bull.

    Gary said…
    BBPOINT,
    The only reason to buy bullion would be if you think we are at risk of hyperinflation in the near future.

    That’s unlikely to happen until at least 2014 so there’s no great urgency to buy physical and deal with the large spreads associated with that market.

  96. Gary

    TZ,
    I think you got flagged as spam because your posts are often very long. Send me an e-mail whenever it happens and I will unspam them as quickly as possible.

  97. Gary

    Visitor,
    The time to buy physical,if you want to own physical, would be at an intermediate cycle bottom.

    I think there is almost 0 chance of a hyperinflation any time in the next year so I prefer to own miners which I think will vastly outperform gold or GLD during this intermediate cycle.

  98. ...at ease

    From my understanding if you want to simply maintain your current value of wealth, you would buy physical gold, however if you want to increase your level of wealth, then trading would be get you there.

  99. High 5

    Obviously trading paper assets is riskier than holding bullion. Bullion has little, if any, counter party risks.

    If there is some kind of monetary paradigm shift gold derivatives could quickly crash while bullion flys to the moon.

  100. Gary

    When was the last time in history that derivatives crashed while the underlying assets soared?

    Problems don’t emerge when assets are soaring. Look at the housing bubble. There was never a problem until the real estate market started to crash.

    It will be the same for gold. Problems with derivatives won’t emerge until the bubble pops not before.

    Folks, these are silly irrational fears.

  102. High 5

    Gary,

    “Problems with derivatives won’t emerge until the bubble pops not before.”

    You also said bullion only needed for hyperinflation. Do you expect hyperinflation will pop a gold bubble or are you referring to the dollar bubble? I’m confused.

  103. Gary

    I took Toby to a specialist last week. He confirmed that he does have stage 2 kidney disease, but he also said he’s seen dogs go for years with stage two and it never gets any worse.

    I’m hoping that will be the case here as I will be heartbroken with out my best buddy.

  105. Gary

    Hyperinflation would drive the final bubble phase of the gold bull market.

    At this point in the bull I would really only recommend physical for someone that has trouble controlling their emotions and tends to sell at the bottom of daily cycles.

    With physical one never gets that urge to sell during corrections.

    But the spreads and liquidity are much better in GLD than in physical gold. Plus I think the miners are going to be the place to be during this intermediate cycle.

  106. High 5

    Gary,

    So if and when a hyperinflation begins you would take that as a sign the blow off top is approaching? Makes perfect sense. Thank you.

    Do you think there’s a chance that if we get a dollar hyperinflation the dollar will survive and if not what would be the new currency? Euros maybe?

    If the dollar fails would gold price remain high for an extended period or maybe even not trade for awhile?

    Thanks.

  107. Gary

    All big cycles run the gamut from extreme undervaluation to extreme overvaluation and back. Gold will be no different than any other time in history. At some point it will reach truly stupid price levels while stocks will become historically cheap.

    That’s the point where you have to trade in your gold for stocks no matter what the fundamentals tell you at the time. All that will matter is that stocks are way too cheap and and gold is way too expensive.

  108. High 5

    Gary,

    Thanks for the answers. One more then I’ll leave you alone.

    Why do you want bullion during a hyperinflation and how much do you want (percentage on NW)?

  112. ALEX

    RJ

    I guess you stumped me : ]

    I actually dont use the diamond topping pattern for a few reasons-

    1) I find that it’s not very reliable UNLESS OTHER INDICATORS ARE USED TO VERIFY…and therefore can mislead one into selling.

    2)I also am of the opinion that they take weeks to form to be reliable , not just a few days. MOST people will actually see one and call it a ‘head & Shoulders pattern’

    Sidenote: A TRUE H&S pattern has certain Criteria to make it ‘probable’…most that I see people call are NOT True H&S- they’re diamonds and take off to the upside
    🙂

    Here Is A Diamond Top Pattern..that was also thought to be H&S…and broke upward,then fell later. Double the pain.

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

  113. RJ

    ALEX,

    Thanks for responding. The CDE one really doesn’t have a “top” but I swear the bottom side looks like a symmetrical diamond bottom.

    Do you use Ichimoku clouds at all? They are intriguing me to learn more about them and I have pulled down some good info on the web. I’m just not seeing an edge from them either at this point (see many bullish patterns fail and bearish patterns reverse sharply).

    I give you major props for buying in the miners on Oct 4th. That was truly a “buying on weakness” event – the marks of a good trader.

  114. ALEX

    RJ

    If I was in CDE , I wouldnt sell , unless this pattern changed, because it could be ready to break higher as a Cup/Handle

    http://www.screencast.com/t/LuO3Dy1B

    And I’ve seen the ‘clouds’ but I havent used them , really. Interesting, but I dont use them.

    And thx on Oct 4th, but I went in fully loaded and sold 1/2 on the way up , so it wasnt a full blown “Old Turkey” nerves of steel 🙂 It just looked like an important bottom the way I look at things.

  115. RJ

    Question for anyone that uses The Linn Group and Ira Epstein’s charting software…

    Each day Ira uses what I think he calls a “slow” stochastic and in one of his videos he indicates he uses a K of 5 and a D of 3 (5,3).

    However, I am not able to reproduce this using these settings, meaning my Slow STO lines look nothing like his.

    Reason I am asking is because he focuses on when the Slow STO is “embedded” or 3 consecutive days with both lines over 80 and his videos don’t come out until 5 or 6pm EST, I’d like to chart in real time.

    I tried tinkering with the numbers but just can’t get close, even using the futures contract instead of $gold.

    Does anyone use Ira’s charting software successfully?

  116. TZ(8155)

    GARY,

    Actually my posts were being hit as spam predominately because I didn’t go through the “give us a phone number” authorization of google. After a certain number or type of posts (without giving them a phone number) they kill the account. I did the phone number thing on the account this time so the ‘unspam’ you just did should be the last of it.
    Thanks.

  117. TZ(8155)

    GARY,

    Notice how many other people are having trouble with the stupid spam filter at blogger. People even moving blogs.

    http://www.google.com/support/forum/p/blogger/thread?tid=2f055acbcd7b6e53&hl=en

    Even after you ublocked multiple of my comments new ones are still getting routed to spam (as happened to people bitching to google there). Maybe unspamming a few more of my comments will work. Maybe not. We can try. I guess if it ultimately doesn’t work I will try creating another login.

  118. TZ(8155)

    GARY,

    Looks like the trick is for you to unspam a number of my comments again and again until the filters finally learn I’m not a spammer. Usually filters like this will switch on the first or second ‘unspam’ click, but googles are not. So we can try it a bit loner i guess. Sorry for the hassle. I hate it too and wish you were not on blogger/google (for a whole host of reasons), but you’ve already weighed in on that.

  119. TZ(8155)

    Before anybody even mentions it, I don’t post to ANY other blogs. I have this account and all i do is read and post here at smt.

    Wonderful smart system google created.

  122. Neo

    Dolar did cross his daily trend line on friday´s close, so i think we may be cautious about PM´s, since USD may have start a new daily cycle.

    Any thoughts ?

    Thks.

  126. Gary

    The one day dip occurred way too early in the daily cycle for the dollar to have put in its cycle low yet. If it can continue to push and make a higher high then we will just have a right translated cycle, but one that is getting deep into the timing band and should move down strongly soon.

  127. sophia

    hey Gary,

    would I get a nice gift from you if I get a friend to subscribe to your letter?

    Just kidding, you are doing great already for all of us!!LOL

  129. High 5

    Just finished opening my first futures account with optionsXpress. Might make my first futures investment this DCL. Any advice anyone?

  132. wolf33

    doing vert little. i am quite conservative. not based off internals—will likely concentrate on TRADING Qs but could do nothing just as well.

  133. mikezza

    based on others experience does gold tend to hold above the 10ma as it moves out of intermediate cylce low? seems like there are few exceptions like march 2011 when daily cycle bottoms move below this ma.

  138. Razvan

    silver looks good today. It consolidated at the 30-32 for a good while now its moved to the 34 dollar area. I think this type of action makes it less likely we will go close to #30 again even if a DCL comes in the metals. The odds are much better staying long especially if you have a good entry at the $32 level.

  145. TZ(8155)

    Triangle on gold here last few days. We look like we are about to launch another $100 higher to 1850 or so (we have had 2 legs up so far, each about $100; I’m not an elliott guy but sometimes it has merit and the pattern of gold on this wave is classic elliott and argues for this next wave of $100)

  146. TZ(8155)

    I’ll get into my trading last month or so (I was just taking a break from the board. No RAZ I didn’t blow my account out by far), but I’m currently 4x long gold with about 0.5x silver (most of it futures on both) from that sharp pullback low on Nov 1. That’s also where my stops are if something goes wrong.

  147. TZ(8155)

    I have zero miner stocks or gdx or etfs (for reasons I’ve mentioned before).

    GDX is showing zero outperformance still (on a smooth continuous ongoing extended basis) against ‘straight metal’ (as I measure it using 50/50 gold and silver exemplified easily on stockcharts by CEF)

    stockcharts[PUT.DOT.HERE.TO.FIX]com/h-sc/ui?s=GDX:CEF&p=W&b=3&g=0&id=p71061369241

    There is a slight bump up in the last 2 months on that chart, but it does not meet my (specific technical) criteria of an ‘ongoing continuous clear’ outperformace yet.

    And remember with the futures you get better tax treatment, better leverage, cleaner stops, 24hr trading, etc.

    So that’s where I am for now.

  149. TZ(8155)

    GLD options expire this friday and the sweet spot to take out the largest group of puts and calls is $170

    (I do not look at ALL the options in existence. I simply look at what is reasonably ‘close’ to where GLD is trading NOW and assume the guys writing the options can move things SOME but not ‘superman unlimited’ amounts. I think they can move it to 170 if they try (lower) by fri, but the EU is looking like a mess and I’ve already said we appear to be headed higher, so I’m not so sure).

    PS: GLD of 170 would be gold of about 1750 which would be a nice round number to likewise expire at next week when the FUTURES gold options expire. Or it could be 1800 or 1850 higher (likly one of these round number we are shooting for).

  150. TZ(8155)

    Silver entry about 2% lower than right now.

    Silver is simply impossible to trade on high leverage without a profit buffer on something else.

    So what I do (same as earlier in the year) is go nuts on gold, which trades VERY well and is VERY liquid and then….if the leveragad gold position is profitable, use the profit buffer to comfortably add in silver (on pullbacks) as we climb towards blowoff tops.

  151. TZ(8155)

    Note that while silver might rebound or outperform gold here on a RECOVERY basis, it is indeed a bit ‘broken’ as gary indicates from the crashed parabola. Too many walking victims for silver to seriously start screaming ahead.

    stockcharts[PUT.DOT.HERE.TO.FIX]com/h-sc/ui?s=$SILVER:$GOLD&p=W&b=3&g=0&id=p81354632705

    Yes, silver has outperformed here and there over the last month or two, but there is no clear, smooth, continous outperformance anymore unlike the end of 2010.

    Eventually the chart will stabilize and a true direction will become clear but for now I can easily (that is the key word there, easily and more safely) get more leverage and gold futures than worrying about silver – even if it outperforms.

    For example, there woudl be no WAY i could have gotten 4x silver with a 1-2% stop (as I use when buying) without sheer luck. But it worked quite well for gold.

  152. TZ(8155)

    The GLD calls and puts is visible here:

    finance.yahoo[PUT.DOT.HERE.TO.FIX]com/q/op?s=GLD+Options

    Scroll down and focus on the quantity of 170 and 175 calls and puts on the list. Those would be the two areas for GLD to zero in on by friday if the writers of options tried to zero lots of premium.

    the 170 = 1750
    175 = 1800 on gold;

    higher than 175 by fri would really show some strength

  153. TZ(8155)

    Thanks gary, looks like the spam filter cleared up. I still might get hit a few more times, who knows, so I appreaciate you unspamming any errant posts that might creep up.

  154. Razvan

    I agree that silver was impossible to trade on leverage after the selloff happened. The volatility was insane but i did grab some physical at $29.

    I build some cushion with the Nasdaq trades and went into silver x5 on the breakout at $32. Right now there is no way i am giving up this hand until it goes towards 37-39 or i get stopped out.

    It does look broken a bit and its evident from the large volatility but with a possible move to 37-39 it is worth taking the trade.

  155. TZ(8155)

    I think silver will match or slightly exceed gold here, but on a RISK or SANITY adjusted basis gold will still be the clear security to trade.

    I’d rather hold 2x gold than 1x silver (which still wins even if silver gains 1.9x over gold).

    Gold also (still) is the risk safe asset over silver as parts of the financial system collapse.

  156. TZ(8155)

    I’ll tease a bit with a comment here:

    In 78-79 there as a point in the bull mkt where there was one final sharp pullback and then gold simply took off and didn’t look back.

    ABCD whatever. It didn’t matter.
    Not many pullbacks either.

    I think that is where we are in the gold market. I think recognition has now set in worldwide as to how bad things are and where this is headed (massive printing and/or BK’s all around). In either case you want straight metal. Not paper.

    I think that the selloff in sept was that equivalent sharp selloff shaking out a final batch of people and I think that from here on out (at least for a while until we are significantly higher) there won’t be huge selloffs. Congestions? Triangles? yes. Selloffs I’m not so sure.

    That is my opinion and I’m NOT betting the farm on it. I have stops and a strategy to trade if we do go lower – as any good investor should, but it is my belief on where things are heading.

  157. TZ(8155)

    >In either case you want straight metal. Not paper.

    Sorry, that comment didn’t really belong in the post.

    The post was more about how I don’t think we get ABCD much anymore and how I also think we won’t have the same type of pullbacks as before.

    My argument against ‘paper’ as per mining stocks is simply based on waiting for them to ‘show me the outperformance’.

    I don’t have as much of an argument against the use of ‘paper’ such as futures to trade and make money, although I agree that you should have a physical portion as protection through either CEF or PHYS or something like that in case things fly apart.

  160. JaketheFake

    At Ease,
    >>Question, does anyone buy gold/silver from Perth Mint of from goldmoney.com?

    I don’t know if you got an answer to this. I HAD precious metals at Perth Mint. It was unallocated, which scared me, so I cashed out there and rebought with another company, storing some in Britsh Columbia and some in HK. These ARE allocated and I am supposed to be able to have the exact purchases I made shipped to me or I can pick them up. As far as Goldmoney.com is concerned, I do have a small account with them which is currently in gold. It is NOT allocated but the guy who runs it, Jim Turk, is a good guy. Also, it is super easy and fast to sell the metals and transfer to your personal account if you need the money. No more than 2 days total.

  161. JaketheFake

    Gary,
    >>But the spreads and liquidity are much better in GLD than in physical gold.

    I don’t know what you mean by the spreads being much better. If you buy a 1-oz gold coin, you will pay a premium of maybe 3.5% and on the sale, probably receive a tad under spot price. If you buy a kilo, you probably will pay just under 1% of spot. Of course, there are fees for storage or if you have it delivered, you need to keep it safe, which is a bit of headache, but not nearly as much as with silver.

  164. Natanarchist

    Wolf,
    I read on the premium site that you are going to see an alternative Doc for your condition? I am curious as to what kind of alternative you are investigating? I just found out last week that I have a not so nice medical condition and am also exploring methods outside the mainstream.

  168. Leilani

    At Ease,

    A few years back, I wanted to buy gold and store gold via Perth. I wired a relatively large sum to them. I waited until the money was in my Perth acct so i can placed a buy order. Guess what? They couldn’t find my money. It took them over a week to credit my account after the funds were wired. It scared me a bit. Perth is bit of a distance from California. So, I had them wired the money back. I also have an account with GoldMoney with nothing in it. I hestitate with GoldMoney only because the storage fees are high. It is based on a the price of gold and it is a certain percentage.

  171. wolf33

    Wolf,
    I read on the premium site that you are going to see an alternative Doc for your condition? I am curious as to what kind of alternative you are investigating? I just found out last week that I have a not so nice medical condition and am also exploring methods outside the mainstream.

    I have decided to make this my last stand. Hope like acres of diamonds. The one procedure is QRNT. Quite new and I have luckily one of the best. But he does a lot else and talks to another that has a patient similiar to me. Do a lot with just vials related to body parts or systems like lymphatic etc. Besides he is a great chiropractor for adjustments which I always need from time to time. The goal is to get the brain communication to do whatt it is suppose to do. Obviously one has to get the immune system —adrenals—liver—etc doing what they are suppose to do. Like I say this is it for me. I have been more places than one could ever imagine. I am after the first of the year go back on a gluten/sugar free diet. I also have 2 Bio Mats to help with pain. A Rife machine—seems to settle me down. I am a big believer in Himilayn Salt. Should mention that Chiro is using some new supplements(herbs) that make me stronger. Other similar outdated NAET-JMT—NMT is newer. If you do not mind, could you let me know where in general you live.
    Please feel free to chat—as I would never ignore but keep in mind I might miss your post so do it again.
    I will keep you in my prayers.

  174. smt_troll

    Danno said…

    “Europe moves into pole position to dominate the world”

    Europe is not going to dominate the world. Aside from the worst demographics in the history of man (some European countries will lose a third of their population by the middle of the century), they have too many structural problems (labor inflexibility for one) to compete with Asia and the United States.

    Gary said…

    “It’s probably too late to jump on oil now.”

    Long WTIC / Short Brent should still have several dollars to go as the premium disappears. This was caused (in part) by a lack of storage at Cushing, which is slowly getting resolved.

    Shalom Bernanke said…

    “If each central bank prints the equivalent of $2 trillion in their own currency next week, the index would stay the same”

    That’s completely wrong. The differences in the sizes of the monetary bases means that $2 trillion from the Bank of Canada or the Sveriges Riksbank would affect the relative values of their currencies far more than $2 trillion from the Fed or the ECB.

  176. wolf33

    ALEX said…
    Blogger wolf33 said…

    clne like a rocket today.

    November 15, 2011 11:35 AM

    Dont firget PEIX and BIOF 🙂

    November 15, 2011 12:47 PM

    WOW! am looking at new technical system—will add. got any more?

  177. Natanarchist

    Thanks for the reply Wolf. I hope it is successful for you. I am in Georgia, buy am looking at receiving treatment in California. I will know more on Thursday, but I am hoping I can wait until the first of the year before starting any treatment. I suspect it will be two or three months living in Cali undergoing treatment. I suppose the won’t be so bad except being away from the family.

  178. wolf33

    NAT—-I went to a place in Walnut Creek—years ago. It worked but could not bring back. It was Interractive Light Therapy—Think called Post Trauma ?

  179. Natanarchist

    Interesting wolf. The place I am looking at is in LA. It will be Hyperthermia treatment with low dose radiation. As I said I will find out definitively by Thursday.

  181. ...at ease

    JaketheFlake and Leilani,
    Thanks for your answers on Perth, I was reading a book by Peter Schiff and he recommended buying through is company from Perth Mint or what he expects to be a common practice in banking Turks site goldmoney.com as places to buy gold to hold. I think for now, I will stick with what works, Gary. I have some physical just for Peace of Mind if all hell breaks lose, but otherwise, I think everyone is out to make money on fears. I think Gary is the only one with the smarts to know how to make the money on the fears in this market to be set for the future.

  183. High 5

    at ease,

    I’ve been warned! LOL. I plan to start off safe and small but for now am still studying the ins and outs. Have you been at it long….any good books or sources of info?

  184. ...at ease

    High 5,
    From experience. Start small, single contract (I only buy the mini gold). Buy at bottoms (cycle lows) twice I have bought the tops anticipating the big run. Nope. had to wait for it to come back up or cut the losses at the higher high. If you happen to buy too high and it drops, don’t panic it’s a bull market, just wait it will come back up. or cut your losses as small as you can and just get out at the higher high. Most of all, make sure you have a cushion, twice as much as you are trading. I got a margin call by buying a top with not enough cushion. So I think I have covered all the rookie mistakes. Other than that, make sure when you buy you know your exit either way. I don’t use the stops unless I just want to go to sleep and not watch all night. JUST BUY AT THE CYCLE BOTTOMS and you should be fine. Made a good amount on the last run up. I sit for weeks without trading in this account. Just wait for the cycle bottom set ups.

  187. ver

    at ease:

    Helpful stuff. Couple questions for you if you don’t mind:

    * you mention a cushion of 2x what’s being traded — do you mean 2x the margin requirements or 2x the value of the contract? I assume you mean the latter but am then wondering how you got a margin call even when buying at the top?

    * what dates do you target, especially considering you’re just looking to buy and sit vs. trade in and out? do you buy further out with the goal of holding through a daily/intermediate cycle or buy front month and rollover each month?

  188. Danno

    smt_troll,
    If you are trying to predict the future it might profit you to read the book famous for predicting the future. Europe is rising, not falling. The middle east is rising, not imploding. The USA will enter decline sooner or later as we are absolutely addicted to cheap oil and cheap oil is in decline. The crisis in Europe is not a real crisis. It’s a manufactured power grab. Demographic problems or not, the old Roman Empire is rising again.

  192. JM

    You sure have come a long way using TA now Gary,, as someone who used to dismiss it completely as just “squiggly lines on a chart” as you use to refer to it. Good for you,, dont agree with either of your analysis on CRB or the dollar tho. Glad your still at it though, Its been pretty profitable these last few years, and seems you’ve done well.

    Best,

    Plunger

  194. Shalom Bernanke

    smt troll,

    My observation is not “completely wrong”. I was not arguing where the dollar goes relative to other confetti. My point is that if all central banks print more simultaneously, the USD index is not nearly as important as what the implications are for metals.

    The fact is the USD index is less relevant every day, especially when trading gold. This has been the case for some time now. If you believe that watching dollar futures is giving you an edge, I’m all ears.

  195. ver

    at ease:

    In terms of contract dates, I take it you bought the Dec. contract around the recent cycle low in Oct., so you purchased 2 months out? Any other helpful tips about how to think about what dates to select?

    I understand there’s no theta decay as with options but you do often have contango in futures based on implied borrowing/interest rates that are priced in above and beyond spot price, and which decays until maturity.

    Also, I’m guessing that the further out the less often you’ll have to roll futures over assuming you don’t actually want to take delivery upon contract expiry.

    Any other experience or caveats you have is much appreciated!

  197. MrSu

    Alf Field speaks!

    “I have come out of retirement for this one off, once only, speech to warn that the good ship ‘Life As We Know It’ is sinking.

    Once this correction has been completed, Intermediate Wave III of Major THREE will be underway. This should be the largest and strongest wave in the entire gold bull market. The target for this wave should be around $4,500 with only two 13% corrections on the way.”

    http://www.jsmineset.com/2011/11/14/keynote-speech-at-sydney-gold-symposium-14-15-november-2011-by-alf-field/

  198. MrSu

    Also, Alf Field considers the possibility for a correction in gold prior to its big move up:

    “At the date of writing (7 Nov 2011), gold has recovered to $1767, which is a 61.8% retracement of the loss from $1913 to $1531 (-$382), a typical size for this type of recovery. That leaves open the possibility (40% probability?) that gold will have another dip to test the target areas mentioned. The higher the price goes above $1767, the greater the probability that the low was in at $1531.”

  200. William Wallace

    Gold is now below the cycle trendline and looks like it may be ready to dip into a DCL, if so, looking for a bottom on the 50sma at 1730ish. Below the 50sma is the 30sma at 1713.

  204. ALEX

    Blogger wolf33 said…

    ALEX said…
    Blogger wolf33 said…

    clne like a rocket today.

    November 15, 2011 11:35 AM

    Dont firget PEIX and BIOF 🙂

    November 15, 2011 12:47 PM

    WOW! am looking at new technical system—will add. got any more?

    November 15, 2011 2:00 PM

    NO WOLF33..I’m sorry I wasnt here all day…I owned both around 55 cents… PEIX and BIOF, I own Biof still , but sold PEIX – at 83cents 🙁

    I wouldnt buy them here, they are just too extended, I expect a pullback soon. I would buy a pullback or extended sideways move.

    DIANA

    Dont buy it here…if it keeps going straight up…thats ok, but it could drop to the 10 or 20 sma…thats WAY DOWN , before it goes again.

    Look at these:

    this is how they run- so almost done??

    http://www.screencast.com/t/htxw61sgcEd

    and PEIX ( COULD HAPPEN..sideways) OR could drop. NOT A BUY HERE…please :]

    http://www.screencast.com/t/SHfesgC5VKZA

    try to view this chart as ORANGE A-B-C-D Just happened…sideways move , then Purp[le A-B-C-D could happen later

  206. ALEX

    W W

    thank you , and I’m glad to hear that you are feeling better ,too!!

    I use moving averages in Much that I do, so your play by play is entertaining and good, BUT–

    I want to say that when I hear that you entered the hospital Again for heart -and are posting on here? kind of worrisome.
    NOTHING is worth weighing down the heart when its weak. Rest up! : ]

    Mini lecture over, I wont mention it again ( but my wife works in Cardiac surgery for real…she said “Cash out and take a couple weeks off…RELAX your heart and mind.”

  207. ver

    at ease:

    No worries, thanks for offering up what you know. You’re one step ahead by dipping your toes and playing it safe. I’ll join you soon 🙂

  208. ALEX

    That came out 1/2 way what I meant.

    I like your posts…YOU are entertaining and your play-by-play is good all day…BUT—

    REST UP , and STAY WELL!! : ]

  212. William Wallace

    Alex,

    LOL…funny you ask, I told the Cardiologist monday about trading, he looked at me all googly eyed and said “oh boy, so much for stress reduction” and laughed 😮

  213. ALEX

    My thoughts on Gold ( I DO LIKE ALF by the way Mr Su …Scooby Doo)is BULLISH for sure, but torn between UP HERE AND NOW? OR DOWN , then up?

    So POLY called that he could see gold going to $1400’s for his own reasons, and I wanted to see if I could get a chart to match that.

    1) This chart I drew in AUG saying that I thought we’d reach our parabolic C-Wave top in OCT/NOV–we were at $1663 –AND we did. Now thinking why have I changed my mind??

    http://www.screencast.com/t/0HjuUaNj113V

  214. ALEX

    This chart below shows that since Feb low of 2011, we seem to be in a STEEPER channel for Gold. DO WE STAY IN IT?? Even so, we’re at the top again anyways, arent we.

    1) A drop back down to the former lower trendline would match POLYS drop to the $1400 area

    2) IF we go to NEW HIGHS NOW, we break above the new steeper trendline too (AGAIN) …a truly parabolic move Ahead?

    http://www.screencast.com/t/YsrVmT483hq

  215. ALEX

    AND the DOLLAR- Based on UUP chart- looks ‘weak’ to me , even though it’s UP in latenight.

    This chart ( This was only 1/2 way through the day , so volume isnt complete for today)looks like a weaker climb than last time it climbed to this price area…

    (no doubt…that could change suddenly, but just weak looking for now, I.M.H.O.)

    http://www.screencast.com/t/oS2YmZqf

  217. ALEX

    W W

    I see both of them possible, BUT I lean towards POP first. I think Miners (SO FAR) are just going sideways, mostly staying above their 10 or 20 sma…consolidating.

    I actually was thinking they’d POP this wk and Gold would follow.

    Its starting to feel like groundhog day , waiting …day after day though!

  219. ALEX

    Agree WW

    $593 and $570 is the 10 and 20 sma support , so even a dip down isnt as scary as it may seem to some.

    But we’ll see–

    I need to go get some shut eye…WHEN DO YOU SLEEP?? I see UR posts day and night LOL

    rest up WW, Miners may break out tomorrow! 😉

  221. diana

    Alex, Thanks for your charts on PEIX and the other one. It’s easy to want to jump on the band wagon when a stock (or gold, etc.) is popping. Old habits die hard.

  224. RJ

    TrendTraderBH,

    Do you know how to reproduce Ira’s slow STO? His video says to use a K of 5 and a D of 3 but using those doesn’t work for me.

    U r right, gold is fighting to stay embedded tooth and nail for the past week.

  225. Danno

    RJ,
    Tried to figure that out once too. Even emailed Ira. He never responded. Trying to trade from Ira’s free videos is very difficult. To follow his system you really need to be a customer so that you can get his intra-day emails. I actually stopped watching his videos for this reason.

  227. William Wallace

    Gold is crawling the 10sma, the move out of this sideways consolidation should be pretty impressive should it break to the upside, especially if the dollar tops today and dips into a DCL.

  229. Danno

    WW,
    There is a small gap a bit higher on the UUP chart that will be filled at 22.08. My guess is if if a reversal happens that’s where it might happen. UUP is not $USD but most UUP gaps still tend to get filled.

  230. Jarek

    Gary when you count daily cycle 20-28 days its only trading sessions not calendar days right ?

    And does anybody know where i can find charts which “time tool” when i can mark time cycles in different periods (30 days, one year etc) ?

  233. Gary

    Yes from the previous low. Cycles are mostly worthless for spotting tops.

    Cycle bottoms occur in a range so there is no mechanical tool that can tell you when a bottom is due. One just has to make a judgment call once we are in the timing band.

  234. Poly

    Alex,

    Alex, I like that Aug chart. If the downside scenario plays out, I believe $1,472 (a prior ICL) should hold the line.

    We first have a DCL to contend with, which is most likely unfolding right now. That might be difficult for many to hold through.

  237. St. Deluise

    /zn (and all US paper) still seems to be the canary in the coalmine, and it is still ranging, 3 weeks and counting.

    gotta expect the first rush out of europe will be into the highest liquid assets in the US.

    thennn when those diverge at the top, the great monetization likely begins.

    flat everything at the moment except some UUP calls.

  239. Gary

    I don’t know about 170 but Friday would be the 21st day of the cycle and right in the middle of the timing band for a bottom.

  242. Rob L

    TZ,

    Can’t you open up a 2nd Google account and use it just for SMT. It might help get past these problems.

    I’d hate for you to stop posting here b/c you one day get fed up. 🙂

  243. Neo

    Poly,

    From your “model”, you still think we may test september lows in near future ? I have followed your comments on twitter and a fz days ago, you were having some doubts about this ICL. You still maintain these doubts ?

    Thks.

  252. TZ(8155)

    ROB,

    I wont give up.
    And I HAVE already opened a 2nd account to do that. It’s google’s system. It may also be other metrics they are using to signify ‘spam’ – my systems are locked down pretty tight and it might make my browser look non-standard enough to set up a warning.

    working on it.

  253. TZ(8155)

    position recap:

    I’m 4x with stop near the 1680 low where I bought.

    I’m also looking to buy the 1725 zone if we drop that far (with small stop as always).

    gold still in a triangle here and could just as well go up as down. very suspenseful actually.

  255. Gary

    SB,
    Yes GLD. I’m not sure the DC will bottom at 170. I would expect at least a test of the 50 DMA and oversold levels on the 5 day RSI before bottoming. Plus there is still the possibility that the cycle hasn’t topped yet if the dollar tops today or tomorrow.

  256. TrendTraderBH

    ww, that full stochastic setting seems to work well to replicate Ira’s (wish I understood why).

    RJ/Danno, I used to have an account with Ira in 2008 and traded/auto traded many of his recommendations. He basically showed me about a 30% return during that rough rough year. I ended up closing my account since I needed the money to cover the blown out other trading accounts I had LOL.

    With Ira, you pay for premium – the charting was over $100 a month, the subscription now for his recs is like $25-50 per month. However, if you follow him and commit to what he is about – you come out ahead! He keeps risk low, hits a lot of singles, and once in a while a home run. ….but of course premium priced.

  257. Shalom Bernanke

    Gary,

    Thanks. I’m also not sure of the levels where it bottoms, or even if it’s trying to yet. I’ll defer to your cycles work and check in from the road here and there, maybe put some buy orders in way below current prices (miners) so I can get fills even if not near the computer.

    In any case, selling is not an option and I’m only looking to acquire more. 🙂

  259. High 5

    “What we commonly find, in going through the histories of substantial or prolonged inflations in various countries, is that, in the early stages, prices rise by less than the increase in the quantity of money; that in the middle stages they may rise in rough proportion to the increase in the quantity of money (after making due allowance for changes that may also occur in the supply of goods); but that, when an inflation has been prolonged beyond a certain point, or has shown signs of acceleration, prices rise by more than the increase in the quantity of money. Putting the matter another way, the value of the monetary unit, at the beginning of an inflation, commonly does not fall by as much as the increase in the quantity of money, whereas, in the late stage of inflation, the value of the monetary unit falls much faster than the increase in the quantity of money. As a result, the larger supply of money actually has a smaller total purchasing power than the previous lower supply of money. There are, therefore, paradoxically, complaints of a ‘shortage of money.’”

    Henry Hazlitt

  260. TrendTraderBH

    This whipsaw market has been tough to trade….so been mostly watching last week or two from the sidelines with my 50% holdings (GDX, DGP, SLV)….learned my lesson long ago not to trade for trading sake.

  261. ver

    Are stocks/PMs setting up for a move higher or just suckering in folks before the daily cycle drop?

    Impressive strength in the HUI / GDX. Doesn’t seem like anything is paying attention to the dollar these past few days.

  262. Danno

    Feathering in some DEC UUP puts. Maybe a bit early but don’t care. Staying light. If UUP rolls over seriously I could see it closing that huge gap down low. But after that I still think 85-90 is where it wants to go. Maybe when France is downgraded for real and the EU problem climaxes. Pulling out to a decade chart it appears the dollar it attempting to gear up for at least one more try. Either that… or all is lost.

  267. wolf33

    Broad Market—I am bullish for a move starting soon. why? in the bones. Never sell a dull mkt short.

    Also great to sell naked puts here.

    jmo

  270. Gary

    Unfortunately on Oct. 4 it was impossible to see where oil would be on Nov. 15.

    I will say that oil is not acting like the dollar rally is going to continue.

  273. Razvan

    i was aware of the phrase “the bull is going to shake you out of your position” but i didnt think it was possible for the bull was going to bore me out of my position! :}

  275. YesLetsDiscuss

    This oil move should be not be taken as a conventional move against the dollar. It is just closing the spread between Brent and WTI. Having said that, it is interesting that WTI moved higher rather than Brent moving lower. That may have a dollar relation. However, we will only know as positions unwind.

  276. gold silver troll

    Once we can confirm that USD is headed down to its 3 year low in 2014 (leading to inflation), will certainly have a nice position in Oil.

    Gold and silver are great…but it looks like Oil is leading the way

  278. Russell

    I just sold out to 100% cash. Too many uncertainties re the USdx. I was up 8% last week, down 1% this am, now out at +2%. Maybe some clarity will be found at a dcl and I can re-enter. You can call me Nicolas Darvas if you want.

  280. Poly

    @Neo

    That’s right, there is a lot about this IT cycle I just don’t like.

    But we just don’t know what the ECB/IMF/FED will do in response to this European crises. A fork in the road is almost upon us and it could be explosive for gold.

    I’m in the all or nothing camp for gold at this point, that last explosive IT cycles needs to resolve itself by continuation or consolidation.

  282. ALEX

    WOLF33

    SZYM…I was watching it & missed it

    I have a watch list that was BIO FUEL , namely ,PEIX, BIOF , SZYM, GEVO

    So I guess GEVO is next?? 😉

    and Energy LEI, TGC AXAS, TPLM ,BAS, KEG, KOG, etc that I’ve traded while waiting for MINERS / Metals to DO SOMETHING!! 🙂

    —if you look at SD on a 6 month…see the inverse H&S? Its looking close to a buy and you can see that if/when it breaks above that sideways move…it wants to run back to $12

    The energy and Bio fuels have been doing very well lately

    I BOUGHT TPLM yesterday…good looking set up

  284. ver

    $173 SPY BoW. Risk-on plays trying to go green. Dollar may finally be putting in a daily cycle top and reversal.

    Poly/WW: It’d be interesting if the last week or two of chop in PMs has been preparation for a launch into the parabolic move you are considering. It’s easy to see how it would leave a lot of people behind who sold out and/or are waiting to buy into a panic selling dip / typical daily cycle low.

  287. wolf33

    and Energy LEI, TGC AXAS, TPLM ,BAS, KEG, KOG, etc that I’ve traded while waiting for MINERS / Metals to DO SOMETHING!! 🙂

    see these on screen–have done nothing. still in clne. t boone seems wired into big G. bill introduced may get publicity.

    oil trading like better own something in defence. i have little irbt.

  289. ALEX

    WOLF33

    I am currently in BIOF ,AXAS, and TPLM on that list.

    I also am now taking some of my trading profits and adding to my miners…I added AUQ and wanted to post a chart (low risk entry, sell below $10.50) , but I am having trouble clipping the chart .
    : (

  290. William Wallace

    Ver,

    Any call, good or bad is still to be seen, like I said earlier, and Gary mentioned it also, if the dollar has topped today this DC is probably not finished yet. We have to see how powerful the move out of this consolidation will be, thats if gold doesnt dip into a DCL if the dollar rally still has some juice.

  291. wolf33

    alex–i have been doing same–tks.

    Off topic—-I think that Ron Paul will win the Iowa Cacus—-i sit here and see the momentum building. How long can every-one ignore him? the polls will be picking this up soon.

  292. ver

    WW: Fair enough, good non-call 🙂

    Alex: How are you playing the upcoming daily cycle low in miners? It’s interesting to see you adding, sounds like you’re planning on holding through? Or do you have a “soft” stop or signal you look for to exit. Miners certainly seem to be in an atypical mode of consolidating in a tight range (vs. sharp shake outs). Unless of course the sharp shake out is ahead of us 🙂

  294. ALEX

    Here it is

    This is AUQ

    During the sideways move , the MACD had steadily been rising , and now the price has risen above the 200sma and the horizontal trendline for support.

    Its forming a triangle consolidation, so I can buy it at the support area, or buy it here and just sell if it drops below support.

    http://www.screencast.com/t/Sd0U9KB2

    Also its above the 10 & 20sma for further support-and in the last 12 days, it has gone up ( $8.75 to $11.25) and nicely held its gains (SO FAR :]

    http://www.screencast.com/t/FjFlc2Zb20Yr

  298. ALEX

    VER

    I pretty much hold a core position , and since I am a trader too, I buy really heavy at the lows and ride them. Then as time goes on, I begin to sell out and trade individual stock set ups that I find .

    Eventually it leads to buying and holding again, when the bottom comes and the set ups are rock solid again.

    I’m still trading right now , mostly energy recently tho.

  301. ALEX

    Some MINERS arent waiting for THE bottom , I guess…they seem to be getting accumulated. see a 1 month chart of

    CDY, MGN, NG, AUQ, MHR ( I bought more MHR, anticipating it’s set up breaking out …inverse H&S )

    And of course -2 old faithfuls- RIC and EXK

    Livermores OLD turkey play…from Oct 4th , would have been sweet.

  303. Poly

    VER,

    I don’t a blast off towards a parabolic ending without a DCL, but if it happened, it would just be a wait and see, find a spot to buy in once confirmation is at hand. A parabolic c-wave top as WW describe will be rewarding enough for the late comers 🙂

    As for the action here, it’s been waiting to roll over for days IMO.

  304. TrendTraderBH

    Bad News – after two weeks gold finally lost its imbedded stochastic today

    Good News – its basically already at its 18 day MA target when that occurs

    Not sure where it goes from here…..

  305. ver

    Thanks Poly. Yes it’s a been a painful, slow-motion drop into the DCL but it looks like it’s arriving on schedule after all.

    Both Gold and HUI regained and then lost their 10-day SMAs, so now we’ve got failed backtests and a close below daily cycle trendlines.

    Wheels are coming off the car in the stock market as well, so we’re probably looking at a sharp, tandem daily cycle low in stocks and PMs and an extended rally in the dollar.

  306. RJ

    TrendTraderBH,

    Per Ira, gold can get back the embedded stochastic only on the next day. If gold rockets overnight it may do it.

  308. Visitor

    RE: JAG – Thrilled, but not surprised to see consolidation in the sector. Although JAG says nothing is firm and they have several inquiries. I have to say I got lucky and bought just before the pop. Dumb luck, but I’ll take it. Completely out now. AUQ buying NXG was/is a great one too, but I am holding all my shares as I like AUQ a lot!!

    This is why I think you have to have at least a few individual names to supercharge your account. PZG I believe will get bought (that’s their whole strategy) as will others.

    Many thanks to the Old Turkey Gary as you helped me focus and get a strategy in the “early days.”

    Yes bitchezzz!! Love me some GOLD (and silver)

  319. William Wallace

    Joseph,

    As me and Poly have been discussing, the possibility of gold retracing to the lows or a failed IC should in no way be ignored…as of right now I am leaning in the opposite direction, but will spin around so fast my head will spin for days…I definitely will not wait until this daily cycle fails to exit positions either. Have to see how things go.

  320. Gary

    With the COT showing max blees ratings at $1600 I think it’s pretty unlikely we will see gold trade back below that level. Only once have we seen gold dip back below the bottoming point once a 90+ Blees rating, intermediate bottom was seen, and that was at the 8 year cycle low.

    The next one isn’t due until 2016.

  321. William Wallace

    Gary,

    The IC’s of,

    07-14-03 to 01-15-04
    03-06-06 to 05-08-06
    11-19-07 to 03-17-08
    08-17-09 to 11-30-09

    May have not failed, but retraced to the lows.

    How were the COT reports and Blees looking then, have any idea?

  326. Gary

    I would also point out that gold dropped just far enough to test the May-July consolidation zone. It’s unlikely that level will ever get tested again during this bull market, especially if the CRB has bottomed.

  328. Gary

    WW,
    As far as I can remember there have only been two intermediate cycles that have failed. One was the 8 year cycle low and the other was a weird double top in 04.

  330. Gary

    The last intermediate cycle had it’s chance to drop down below the 200 DMA. It was early in the intermediate cycle. We could have seen one more failed daily cycle that would have pushed gold’s intermediate cycle into the normal timing band.

    But that didn’t happen. Buyers came back in at $1600. I think it’s very unlikely we will see gold ever trade back below that level for the rest of the bull market.

    It would take another financial crisis IMO. And the powers that be just aren’t going to let that happen twice. They are busy making sure the cancer spreads into the currency markets. So the next crisis will be collapsing currencies and that is not negative for gold.

  332. riley

    WW
    If gold futures test 1730-1700 would you bail on futures? I was looking to add a future if retests, but possible scenario you and Poly warned of has me wary. Anyway good see you are in good spirits, and good life to you.

  339. ALEX

    I thought GLD looked weakish end of today- but I’m not saying CRASH scenario (yet).

    The 20sma is right below, or a bit lower is a trendline for possible support.

    just 1 step at a time for now…(I still think Miners look ok).

    http://www.screencast.com/t/M9q2R7u2

    http://www.screencast.com/t/UyEX7kJioXz

    P.s. while creating this chart and retrieving it- I accidentally deleted my WHOLE album of all the charts I’ve made over the yrs.

    I couldnt believe it!! (Insert man crying at his desk)

    — anyways….my links on all other post…no longer work.

  340. Steve

    John,
    Are you the same person that made the following comment on August 22 at 6:41 PM?

    “the train left the station folks … watch the silver parabola unfold before your eyes”

    Thanks,
    Steve

  341. ver

    Alex:

    That’s awful. You may consider emailing/calling tech support though their site says its not reversible. That’s poor form for a service like that especially if it’s paid and not free.

    Sorry to hear it.

  344. ALEX

    Thanks Ver

    Yeah, even my email will hold my deleted item in a trash bin for a day before completely eliminating them, AND it asks if I really want to delete it.

    That service, my mouse must’ve double clicked delete and the whole folder was gone and irretrievable. Thankfully -it was only a few hundred recent ones (LOL)

  345. The Angry Hippie

    Poly, your call to exit long positions on Friday is looking pretty inspired right now. Are you developing your tool to avoid declined into DCLs with relative consistency or had you identified a larger concern than this probable correction? And have you identified a reentry point?

  347. John

    steve,
    yes … they forced the sell-off … it was z first abc correction in silver bull2date … after 11 years , the parabolic rise is around z corner … u don’t want to be out cause the D wave may be to the upside one day hhh … the rythm will certainly change and u will be left behind

  350. John

    C wave is unfolding

    oh wait, C wave was cut short, we’re beginning the D wave

    ooops no stop, the D wave may not be here yet, we may get an extended C wave

    ohhhh stooooop … this truly D wave, and it’ resuming

    hold hold hooooold it now, the the D wave is aborted, we may in for the big big parabolic run to the upside.

    Hhhhhhhhhh … so many flip flopping going on here

    see .. that’s what i’m talking about … sit tight folksies and don’t make any mistake at this juncture … it would be very foooolish

  352. oa92000

    John said…
    C wave is unfolding

    … sit tight folksies and don’t make any mistake at this juncture … it would be very foooolish”

    John, what is your holdings ( sitting on)??

  353. John

    oa920000000

    50% physical silver (1/2 eagles, 1/2 maple leafs)

    50% silver etfs (2/3 agq, 1/3 uslv)

    dumped pm stocks – went leveraged etfs

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