PORTFOLIO CHANGE

A portfolio change has been posted to the website.
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415 thoughts on “PORTFOLIO CHANGE”

  2. William Wallace

    I posted this the other day, just thought I would re post it again for those who may have missed it, the only thing thats changed is the DC trendline is now higher than the 150dma.

    “Just want to point out (besides trying to pin point it in realtime) a few significant levels im looking at for a DCL in gold now that the move into a DCL may be underway…

    First of all, as I have mentioned many times in the past, a break of the 10dma this late in the timing band for a DC top almost always indicates that the move towards a DCL is in effect.

    If the requirement for a DC trendline break is fullfilled, the 150dma and $1700 handle will be breached, they have basically all converged.

    If the 150dma is indeed breached, below that we have both the C-wave 23.6% and the current Daily Cycle 38.2% Fib levels at $1673, which is also the 11/22 DCL pivot.

    If that Fib level is breached (personally I dont put too much faith in them as hard support)we have the 50dma currently at $1664, which I have much more confidence in for a firm bottom.

    If the 50dma is breached under heavy selling pressure we have the 200dma not far below, if this were the case most likely the 200dma (or slightly above it) will mark the bottom and give us a key reversal that will close at or above the 50dma.

    A into B waves are even more tricky to navigate than D into A waves…one A-wave daily cycle or two? Maybe three! If two the second possibly fails and one is caught in a B-wave…you know the deal.

    Wouldn’t it be great if gold was just entering the bubble phase and the ABCD pattern was abolished?”

    February 4, 2012 11:15 AM

  9. William Wallace

    Neo,

    I laid out my expectations in the post above, there will be a number of bottoms, we have one here, pin pointing the final is tough, so I buy all of them with break even stops…but keep in mind I trade futures so I can do that.

  10. ALEX

    20 sma for GOLD is $1704 we hit it-

    NETDANIA has it looking that we broke FEB 7th lows on LIGHTER volume on 2 hr chart…looks like lighter on a 4hr (but the 4 hr finishes at 10 a..m. eastern) and reversal .

    Could that be it?? I’m not sure if volume on NETDANIA is accurate anyways.

  11. William Wallace

    at ease,

    I can recognize bottoms looking at a chart in realtime, whether or not it is the FINAL bottom I cant say, so like I said above I buy each bottom immediately when I see it with a break even stop.

  13. ver

    WW:

    Do you wait for a tag of the SMA to go long or just getting “close enough”? For example we didn’t quite make it to the 150 this morning.

    Feels like we haven’t really seen any panic selling, which suggests we have a sharp move down ahead of us.

  14. William Wallace

    If the stock market is just beginning its move into a DCL as I mentioned yesterday I was expecting to happen today, then gold is headed lower also, maybe not today, but next week.

  21. Danno

    Bought some ZSL @ 10.35. Nothing serious. Just doing a little gambling. Odds seem fair ZSL will see at least a small short term pop.

  25. TZ(8155)

    The 8:30am low in gold was tempting (about 7000 contracts stopped out), but I didn’t bite. I’m still expecting something sub 1700 to purchase.

  26. Haggerty

    I’m going to start to nibble here, and bring my core position to around 50%.

    I’ve been trying to get cute here over the last 6 months and it’s done nothing but really cost me money.

    I think Gary said it a couple of weeks ago, on a long term chart when you look at where the HUI is to the price of Gold it is selling at a discount,

    For example GLD in mid 2010 was at 120 ish and the HUI was at 500……GLD sits at 167 and the HUI is at 524. I really don’t think we are not going below the recent lows

  28. Matt

    WW,

    I consider myself an avid chart watcher – primarily 5 min futures charts – when trying to time daily tops and bottoms. But for the life of me, I am unable to see what you see when it comes to a daily trend change. There are many occasions where I get whipsawed to death, get discouraged and then miss the move entirely. I have been doing this for 20 years, so I am no spring chicken. I do okay overall, but geez your calls put me to shame.

    If you would be so kind as to throw some scraps of techniques or pointers my way, I would be forever grateful.

    [email protected]

  30. William Wallace

    In the past I mentioned many times, when gold puts in a daily bottom (not a daily cycle bottom, just the bottom for the day), it almost always retraces back up to the 150-200SMA on a 5 min chart, we see that right now. Thats not to say it wont move above it, but as you can see there is a run back to the 200sma and hard resistance. I spoke of how I often take a trade out of the bottom and take it off at the 200sma on a 5 min.

  32. William Wallace

    If gold were to move decisively back above $1735 I would take into consideration that the DCL may now be behind us, but that depends on what type of pressure if any gold comes under if the stock market continues to drop out next week.

  36. William Wallace

    If gold chops around at this level for the rest of this session, I expect out of the open Sunday night we will see a test of the 1735 area, if the DCL is in front of us we will most likely see a reversal at that level (if not before) as gold continues to fall out and attack the 150dma. If the DCL is behind us we should see gold move above $1735 fairly easily and push higher…I have some targets for a top in mind for the next DC.

  43. Quy

    WW,

    I’ve been quietly following/appreciating your posts along with everybody, but now if you’re doing the email thing, throw me in there ([email protected]). May be it’d be better if you just post your explanations so we all could see & learn. There’s so few of us that we couldn’t move the market with what we learn from you, or could we !

  45. Veronica

    TZ, have you ever done a backtest on parabolic sar? If you would have, you would find that the wins are only 45%. Not exactly a great % to build a long term strategy on. I have always said my system does use elements of sar but is using other parameters also. How would you explain my system when it holds wityhout a stop? Can sar do that?

  55. student123

    WW,

    Are you thinking of any “Newsletter” or ” Trading Alerts” service? I am about a year watching your amazing trading. I think you can be quite successful in that business.
    I would be the first in line to subscribe to it.

    Here is my email in case…
    [email protected]

  59. William Wallace

    Todd,

    Look a couple posts up, I mentioned a little while ago that I am out of my long now. I was actually short from near the top, mentioned it to Riley the day gold topped, covered short this morning and went long, which I took off a little while ago. As you know if you read my posts a few days ago I warned of the top (actually the day gold topped), I continued to warn that we were in the “topping process” and that there was further downside, and mentioned earlier that gold may continue to fall out if the stock market has begun moving into a normal DCL, if not ICL. If your long and you take it off here there is the chance you get left behind, but if you hold you are caught in a DCL and must hold until the bounce out of the DCL with a stop in place, because the question is will the next DC make a new high or not.

  60. Todd

    Thanks for your response WW.
    I bought this morning just under 1710. But, I am considering putting a stop at today’s low. However, I am reluctant because I don’t have a gold core and I am scared to lose it.

  64. William Wallace

    Todd,

    If you went long at $1710 you either are in near the bottom or not, gold wont drop back down to that level if the DCL is behind us, if not there is no reason to give back anything from here, so put your stop at break even.

  66. sophia

    W2,

    no need to put me on your mailing list, I was just kidding!
    BUT, I would love to see you type ” a bottom is in” like you did twice in the last 6 months!
    Good luck for Monday, will think of you and wait for your post to make sure that you are OK, my friend!! LOL

  67. The Angry Hippie

    Has anyone done a retrospective analysis of BOW/SOS numbers in relation to IC Tops and bottoms to try and tease out the sensitivity of this indicator? Data on WSJ goes back a couple years. Anyone know where we can get more distant data? I’m interested in putting together some data on the topic.

  71. Gary

    They are both predictive but the SoS often comes early. The BoW tends to be a much better timing tool, but only for the SPYder’s.

    Tops are pretty tough for anyone to get right with much consistency. So when things start to get stretched you see smart money start to sell into rallies. It doesn’t mean they will pick the exact top. Just that they know it’s getting dangerous.

    The mistake that many retail traders make is they think they have to catch 100% of the rally. If they exit youand the market keeps rising they freak out and talk themselves into buying back in. That’s usually about the point where the market tops.

    I’ve been trying for weeks now to tell people that it’s too dangerous to continue pushing the long side. Let someone else catch the rest of the rally. It’s just not worth taking the risk of getting caught in an intermediate degree decline.

    I’ve been around a long time and I know what happens during intermediate declines, and it’s not pretty.

    I want to make sure I have plenty of cash to buy at the bottom of one of those, instead of ride it down, freak out, and sell at the bottom.

  73. Matt

    WW,

    Had to step away for a moment. I did see the 150 crawl. I was also looking at the range bound between 1720 and 1725. I suspect we may have settled within that range for the day.

    BTW: Sorry for getting the blog started on the email chain.

  83. GP

    Enough of bowing to European Pressure, its time for Greek Prime Minister to stand up for its people and reclaim Sovereignty

  91. DP

    WW —

    “…Watching it in realtime is a whole different picture than a snapshot. Using MA’s in historical charts tells a whole different story…”

    Can you please elaborate a bit on that?

  94. William Wallace

    DP,

    I explained this a couple days ago to Arun somewhat at length, but to keep it simple…ie. If im trading gold futures and gold is approaching the 150dma in the after hours session and bounces off it making a $20 run to the upside, then during the daily session it retraces back down and breaches it to the downside $20 and bottoms well below it, looking at a historical daily chart the following day it would seem as if the 150dma was completely ineffective during that session.

  97. Gary

    The miners are not acting like this is the bottom of the gold correction. I suspect gold will test the Dec. low sometime in the next month or two when the stock market puts in the next ICL.

    This is what big C-waves do. They make you hungry for the party to resume. It never does. At least not before many many months of consolidation and whipsawing.

    I doubt we will see anything but sideways to down chop till the fall and maybe not even until next spring.

    It’s going to take a long time to consolidate that 2 1/2 year C-wave.

  99. DP

    WW —

    What I understand you assume that Moving Averages must be built using data from CONTINUOUS 24h trading, not just the daily sessions. That’s what exactly is done by barchart.com, I guess.

    So, the barchart.com graphs must have the same value versus MA’s as a your continuous data feed, I guess.

    I really like and appreciate your posts. Especially you presence in the open blog makes its atmosphere nice and polite.

    I wish you successful surgery and hope you recover fast.

    Good luck!

  101. William Wallace

    Gary said:

    “This is what big C-waves do. They make you hungry for the party to resume. It never does.”

    I’ve had my party hat on since the Dec bottom, the party didn’t start for those who chose not to come.

  104. Bill

    WW, thanks for that. Despite the fact that GLD only trades during NY, whereas gold trades 24×7, a hollow red on GLD is a pretty good signal. I ended up NOT buying because price is below the 10d EMA, and because the PPO (MACD) is now negative.

  106. Bill

    Gary, you might be right about how this year unfolds. 2008 was such a year long correction. The huge debt would also suggest this is possible.

    But, if Ben starts QE3, I think gold could shoot up. And history suggests that govm’ts ALWAYS choose printing over austerity. Also, since this is an election year, if Ben wants his job, he’ll probably print to make stocks go up, making gold go up further.

    I think you’re right about the S&P tanking here for a month or 2 – taking gold down w/it – but I think that will be it – gold will start it’s C wave up, beause Ben will be printing by summer.

    Who knows. I’m just saying that I expect it. But I’ll trade whatever happens.

  109. Gary

    The previous IC cycle in gold
    was very short at 13 weeks. Instead of week 6 what if gold is on week 19 of a slightly stretched IC to balance out the short cycle that bottomed in Sept.?

    4 or 5 more weeks down bottoming along with the stock market would still put gold in the normal timing band for an ICL.

    I think it’s a mistake to ignore the stock market cycle. Any time stocks move down into an ICL it is a big event that effects virtually every other asset class.

    Occasionally gold can resist that kind of selling pressure to some extent. The miners are always affected, usually severely.

    A lot of people seem contnent to ignore the fact that the HUI was unable to regain the 200 DMA despite a furious rally in gold. The 50 DMA has fallen below the 200 and both are declining. And now the miners have dropped back below the 50 DMA.

    Does anyone really think gold is on the verge of a push to new highs or even a test of the highs with the mining sector acting so badly?

  110. William Wallace

    The miners have been consolidating the whole time gold was busy churning out a 3 year advance higher. The real question is, does anyone really think miners will go parabolic without gold going psycho.

  112. Unknown

    >>>> Does anyone really think gold is on the verge of a push to new highs or even a test of the highs with the mining sector acting so badly? <<<<<

    Not a snwoball’s chance in hell, IMO. It will bounce around but a test of $1,900+? No way.

  114. Bill

    Gary, thanks for pointing out the swings in the Weeklies.

    Something is wrong with the miners. Since Jan 1, SPY is up 7%, GLD up 10% and SLV up 20+%. But GDX is up only 6% – even lower than SPY.

    Plus the volatility in GDX is INSANE.

    I don’t know if it’s HF’s shorting GDX, or if there’s no more gold in the ground, or labor costs rising, or whatever. I won’t trade GDX. And I don’t trust GDX as a sign of GLD doing anything anymore.

    I’m just going to trade GLD and SLV from here out. Just me.

  115. Bill

    Further … I again agree w/Gary that the SPY will take GLD down for the next few weeks or months.

    But I think that GLD will put in a higher low on the daily chart, or a divergent lower low, and if/when it does, I’m buying 1/2 of my position in PHYSICAL bars, the other 1/2 in CEF. Price will below the 150d EMA.

    No more screwing around for me. I’ve f’d up for way way too long, and lucky me the world hasn’t collapsed. But it’s coming, what w/all the debt, and all the f’ing liars on Wall Street and in public offices. I’m really sad and pissed off to see this, but it is what it is. Humans are totally dishonest.

  116. Bill

    I think that from now on we should have dog’s run the world. At least it’d be honest. Although we’d probably be eating Alpo the rest of our lives, too!

  117. Gary

    I agree that some of our problems are this honest politicians. But a big part of the problem is that there are no easy solutions left. We either default on our debt and cause a deflationary depression. Or we print and ultimately cause an inflationary depression.

    Since printing allows us to avoid short-term pain that is the path that will be chosen.

    Human beings have evolved to avoid short-term pain. So whenever this choice has to be made we almost always make the decision to kick the can down the road, which just makes the problem bigger. Which is why we are in the situation we’re in right now.

  118. Bill

    Gary, sad but true. It’s hard though for folks like many of us (me for sure) who has spent their entire life living within my means, expecting nothing, and working my arse off – saving 1st then buying or choosing to live w/out stuff. So many people now are fat, have too many clothes, have all the techie toys, and expect handouts. Put them in the woods Friday and they’d be dead by Monday. We need to go back to the caveman days, and focus on family, community, and living within our means. Sure, we die by 20 or 30, but at least we live as MEN (and women!) and not as punchbags w/no work ethic. Again, just me.

  119. Bill

    So what I’m saying is that, although most humans are just as you say, there are enough of us wiser humans to know our own nature, and have the discipline to live small and still be happy, for real reasons instead of artificial.

    I myself vote for austerity. No more nothing for anyone who doesn’t work. Nothing. And those that work should share to help those who don’t work. Again, just me.

  120. Bill

    I mean, those who can’t work. The rich should help those who can’t help themselves. Charity is very important. But giving cupcakes to those who are greedy or already bloated should be stopped. Sending SSN checks to the rich is insane. Meanwhile those who are truly poor have no relief. Makes me absolutely sick and ashamed.

    Done for now. I need to ride to burn off this stress.

  121. Bill

    FYI giving to the poor is an important part of making money for my wife/I. Same for you Gary w/your weightlifting team, and probably other stuff. But I’ve been around enough rich folks who don’t give one iota about the poor, it just makes me sick. They flip mails on their iPhone driving their Porsche’s and BMW’s that they are totally oblivious to the poor. If they sold a hubcap, that’d feed a family for a week. A week.

  122. smt_troll

    TZ(8155) said…

    “No. You don’t get rich by shorting.

    Even the VERY few people on this blog who make SOME money by shorting know that statement is true.

    The rest are simply gamblers or cant do math.”

    I am going to disagree (strongly) with that.

    First, I will concede that most people do poorly shorting. I believe success in shorting depends a lot on the personality of the trader, and people need to trade in a way that matches their personality.

    I have always made a lot more money on the short side. To me, it just seems easier to find “mini-bubbles” (coffee and cotton in the last year just to name two) and short them than to make money holding long positions (although I still do have longs).

    But let’s look at one example using some (simple) math. Over the last forty-three months, natural gas futures have lost more than 6.9% per MONTH (compound return for the second month contract ADJUSTED FOR THE MONTHLY ROLL).

    A strategy of shorting the second month contract (with no leverage) and rolling into the new second month contract when the front month contract expires would have returned more than 1650 percent during that time (yes, I am ignoring transaction costs, and applying the 6.9 percent to the entire amount – in reality, there would be an integer number of contracts each month, and some remainder that would not earn a return).

    I dare say this has done even better than Gary over this period. 🙂

    I don’t want to encourage people to short if they don’t feel comfortable with it, but in pure trading (a zero sum game, unlike investing in companies), the same number of dollars are gained (lost) by the short position as lost (gained) by the long. It’s silly to say that only the long side can make a lot of money.

  123. Bill

    FYI giving the poor food and clothes is great short term, and giving education and jobs is a key part of sustained growth out of poverty.

    There, I’m done now.

  124. Gary

    First off you only mention two cases where you managed to win. You didn’t bother to tell us about all the cases where you just kept getting whipsawed out time after time, or the times that the intraday moves knocked you out for losses.

    Like I always say if one would honestly go over their trading history 99% of you will find that you lose money over the long term selling short. That is especially true of traders who think they can successfully sell short with nothing more than charts.

    Successful bears have research depts. that find sick or failing companies.

    Coffee is only down 30% and that’s if you managed to time a perfect top and could hang on through all of those violent swings. Not too mention the thing went straight up for months with multiple false tops. Anyone trying to short that lost so much during the run up that they would never be able to make it back once the top came.

    Cotton, same story. Months and months of steadily higher prices with multiple false tops.

    You’re either the greatest trader in the world or you are conveniently forgetting about all the multiple losses you took before finally catching the top.

    If you did better than the model portfolio it’s only because you leveraged massively and got lucky.

    I can’t depend on either one to produce sustainable gains.

    I’ll let others dream about easy gains selling short. The reality is, it just ain’t so.

  125. NJ

    Wow WW. Looks like you had quite the discussion going with the intra day MA’s! I guess when you look @ the charts like a hawk, you see things us mortals can’t see! 🙂

    Good Luck for the 27th!

  126. smt_troll

    “I’ll let others dream about easy gains selling short.”

    I never said it was “easy” (neither is buying long), but some things have proven quite reliable over the years. One of those is selling futures with large contango.

    I mentioned natural gas (down 6.9+% per month for forty-three months), which you didn’t bother to repeat. That has made me a lot of money (and there is still huge contango there – next January is forty-seven percent higher then the current month).

    There are a few others. Volatility futures (down 11.4 percent per month for thirty months through the middle of last year), and even lumber (down 2.9 percent per month for sixty months through the end of January). I particularly want to point out the similarity to volatility futures and insurance – buyers tend to pay more than fair value.

    “Like I always say if one would honestly go over their trading history 99% of you will find that you lose money over the long term selling short.”

    *I* know where *I* make my money, and most of it comes on the short side.

    “That is especially true of traders who think they can successfully sell short with nothing more than charts.”

    I do a lot more than that. I spend the whole day doing everything from developing and updating models, to evaluating macro events to reading crop reports.

    “Successful bears have research depts. that find sick or failing companies.”

    Too many companies. There are only about a hundred or so (important) futures in the world, and I tend to concentrate on those.

    “You’re either the greatest trader in the world or you are conveniently forgetting about all the multiple losses you took before finally catching the top.”

    Nope (especially not the greatest trader part 🙂 ). I am just doing the basics. Finding my edge (most people can’t short successfully) and exploiting it (using the experience I have gained over the years, and, of course, good risk management).

    “If you did better than the model portfolio it’s only because you leveraged massively and got lucky.”

    Or because I developed my skills over a number of years, and work hard at it.

    “I can’t depend on either one to produce sustainable gains.”

    I never said you should (and it seems you can’t – if you believe that something is impossible for you, you are certainly correct).

    My point is that there are a lot of ways to make (and of course, lose) money. I don’t see why, by sharing my experience (which I clearly said is not something most individuals can replicate), you should imply that I am a liar.

  127. KAL

    William,

    Hey, can you do me a favor and tell me what platform you use to see the real-time sma’s? I have been following your posts when I can and find your work fascinating. I don’t have the time to do it, but at night after the kids go to bed, I could follow the futures for awhile and finally see in my head what you’re talking about? Maybe? Thanks and good luck with the surgery!

  128. 86d4life

    Kal,
    You can download the TOS platform and choose the `paper money` option at login and get to use all the great stuff they have. Using the paper money is a freebie and real time. Good luck.

  129. Haggerty

    Gary

    In the first 6 months of 08′ the HUI averaged (for arguments sake around) 440ish While GLD averaged around 90ish during the same time. Right now we are 90% higher on GLD and about 18% higher on the HUI.

    Right after that we had the crash of a lifetime, Unless your expecting a 4 yr cycle low soon(which I doubt with the QE’s), I really see no reason not to start building an old turkey position.

  130. Gary

    If you’ve been around long enough you know that you don’t buy anything before the stock market moves down into an intermediate cycle low.

  131. Haggerty

    I know I just believe that we aren’t going much lower. I also feel that we are going to be consolidating for a while, I just hope I can raise a good amount of cash during that time to add to the portfolio.

  132. Tiho

    If anyone is even remotely close to any success in the market timing, either on the long or the short side, they must be a lair or a bullshit artist, when it comes to this blog. Lot of people here must be very insecure in their own abilities.

    Maybe the reasoning behind this is because the overall concepts of market timing here is out of whack just a tad (end sarcasm), because 99.9999% of all decisions are made just on cycles. And when a certain asset class missed the timing band of the cycle – because cycles do not actually work all the time – everyone chucks a big cry and a huge whinge, than starts blaming each other or calls anyone else who correctly timed the bottom or a top “luckily fluke bullshit lair artist”, who only did that once, because historically they got it wrong 99 times before that.

  133. Danno

    Tiho, There is no perfect system. That’s what stops are for. If you stick to your stops you should be fine with Gary’s system. I have seen Gary be absolutely wrong and still make money, while I was absolutely right and somehow managed to lose money. Gary has done his homework and has hammered out a no-nonsense trading plan with safety measures. You have to respect his knowledge and track record.

  134. 86d4life

    Tiho,
    Here`s your chance. If you have something that is better than what we are already using, I can`t imagine you could find a place with a more captive, appreciative audience. I bet Gary would even change styles if you have something better. Here`s your chance, Sunshine! And to the rest of our SMT Family, I say let`s give Tiho this chance. After all, what do we have to lose?

  135. SF Giants Fan

    Today, we have a cover of Barrons with DOW JONES 15,000 written so big all over it that even Stevie Wonder could see it ! I suspect that sooner rather than later the Bulls are going to be in for a surprise

  136. SF Giants Fan

    Video shows Tom Demarks proprietary indicators plus other market outlook.  

    00:00 – 04:15 Market outlook
    04:15 – 14:26 DeMark indicators for the S&P 500 and Germany
    14:26 – 19:31 CCM Market Models

  137. Bill

    That hollow red in GLD’s daily chart still has me spooked, despite the MACD which just turned negative. If GLD get’s above 170.37, I’ll go long w/a small position. Although my triggers are on daily charts, I often times find it easy to see what’s going on using 60 and 30 min charts – on these I look at price only and not oscillators/indicators. GLD is trending down now, but a break above 170.37 would be a micro-higher high, so I’d buy.

  139. Bill

    Basically, I think this “topping” action in GLD is taking a bit long as compared w/Nov’s high (ref: EricH’s post). The fact that it’s taking longer has me suspicious that this is just a horizontal correction, and that it may break to the upside. If it does, I will follow.

  140. thedocument

    Bill,

    I wouldn’t put too much weight on the appearance of candles. That said, some indicators I watch make me believe gold and miners (and maybe even the stock market) are about to surprise to the upside. Just from the cycle perspective, gold should set new rally highs soon, as it is in the process of completing a RT… and nearly extremely RT… daily cycle. However, I believe both gold and miners may shoot to the upper bounds of their consolidation patterns over the next 3-4 weeks before correcting sharply along with an intermediate-degree drop in stocks.

  141. KAL

    Thanks 86d! I appreciate it. I’m with TD Ameritrade but haven’t messed with TOS much. I’m a small fry with a full-time job and young family so I usually just use the web app since I pretty much follow Gary’s calls. I will check it out… Thanks again.

  142. Bill

    Was studying GLD from many timeframes again, and just now noticed slight pos. divergence in the PPO/MACD on 60 and 30 min charts. I’m real sure now that GLD will close higher on Monday.

    I’m now pondering entering at just above 168.13, or just above Thursday’s close. Friday, GLD gapped down, then slightly drifted higher. A price up to 168.13 would fill that gap; and I’m now thinking that any price above that would be bullish for the trend. So I may enter a small position at 168.25 or so, and then more at 170.40 – something like that. My floor would be at 166.30, in case I’m wrong. Risks are 1.2% and 2.4% respectively. Am still thinking though.

    4 things make me a worried bull: price action is taking a bit long to top, Ben spoke of QE3, Europe is hosed as is the US, and Gary said many times that surprises come to the upside.

  144. Bill

    thedoc, generally agree on candles. But for GLD however, it does seem to happen more than 50% of the time. It’s not a buy signal, but for me anyways it’s a sit-up-and-take-notice signal.

    I’m not a cycles guy, but I follow Gary because he’s an overall great trader, plus I learn from most folks here, too. I’m a big believer in following just price action, and so far it’s 50-50 that GLD is topping on daily chart, or just sideways consolidating. I’m just preparing my mind for a break up. Glad to hear that you too are preparing for that should it happen. I’m just a beginner.

  145. William Wallace

    Bill,

    I noticed a couple times you mentioned that gold is “taking long to top”, but in fact the previous two daily cycle tops were both 10 days top to bottom, this top is only on day 6.
    GLD is an ETF, you need to look at a chart of the underlying.

  146. Bill

    WW, OK thanks. I was just looking at tops on the daily GLD chart over the past year.

    WW, one more thing I just noticed a few mins ago … on the 30 min chart, it looks like GLD filled the gap on the 26th – GLD ran up big after Ben opened his mouth on the 25th – then GLD gapped up the 26th and went higher. Friday’s gap down looks like it filled the Feb 26th gap. WW, I know you look at spot gold and futures, so gaps are mostly gone, but I’ve read that some take note of gaps on GLD in particular.

    All’s I’m saying is that I think GLD could go up, and the odds are 50-50, and if it does I’ll follow. 😉

  147. Bill

    uh, meant Jan 26th gap – last Friday’s gap down filled last Jan 26’s gap up – looks like.

    Moving forward, I’ll take care to re-read my comments to eliminate typo’s.

  148. William Wallace

    Bill,

    I hear ya, if gold plans on pushing higher (even if for just a day before falling out on Tuesday), I’ll be long before ya wake up Monday morning and short before you go to sleep Monday night 🙂

  149. Bill

    WW, you remind of a Terrier going after a rat – on it’s tail every turn, left right, up down, doesn’t matter – always in your sights.

    Good point too though that GLD could go up a bit but not make a higher high, then tip over and go down. I guess that’s why Gary always waits for a key reversal. Good food for thought – thanks!

  153. William Wallace

    Poly’s track record is well worth the subscription price.

    “I could go on about my track record, how I rode Silver to the top and jumped off, how I called to the day a major summer Gold rally, when everybody called for collapse.  After the summer collapse all thought it was back to new highs, I showed it was going to collapse again. But the reality is; only you can decide whether what I have to say and share is going to be of value to you” – Poly

  154. SF Giants Fan

    High 5 and WW

    I just wish Gary, Doc, Poly and WW would team up. Great for us but hell for them. Can you imagine a time when all 4 would have 4 different opinions trying to send out the nightly report?
    It would be one hell of a team!!

  156. Gary

    A week ago the volume was only about double and it was selling volume. That doesn’t tell you when a turn is or has happened.

    It wasn’t until Thursday when we got a hint that a turn might be coming. Friday it was confirmed big time.

  157. William Wallace

    “BB crash on the VIX
    Everything bullish % is in nose bleed territory
    SoS # on Spy today should be big.
    Volume on TVIX this week was huge.
    News out of Europe this weekend ?

    Looks like the perfect setup for a top IMO.”

    February 3, 2012 6:47 AM

    – SF Giants Fan

  160. Gary

    For the most part I don’t really care if people want to start their own newsletter and draw their clients from my subscriber base. This has never been about money or subscriptions for me. It was about helping people ride the bull market.

    But this has gotten to the point where I think I will speak up.

    Both Doc and Poly are very experienced traders and I have the utmost respect for both of them so I’ll put this as delicately as possible.

    The quickest way to generate new subscribers is to make a bold call in the opposite direction of me.

    If it pans out you have 3000 potential new subscribers that think you know something that no one else does.

    Barring the need to generate customers I don’t believe either one of these two guys is crazy enough to buy anything on the 19th week of an intermediate cycle.

  161. thedocument

    Gary,

    I have no need to make silly calls in order to snag subscribers for a couple hundred dollar annuity. I run an investment partnership where the stakes are much higher for making correct calls, and I do trade what I call. I have every intention of adding to my positions upon the next swing low in gold, and I have posted my views here for the same reason you run your letter… to help people.

    I also believed you enjoyed thoughtful challenges to your commentary as opposed to some of the banal trolling that goes on. If you only see my comments as showmanship and an attempt to be different for the sake of being different, then I have made a gross mistake in judgment.

  163. William Wallace

    Gary I don’t think you have any reason to “speak up”, your simply one to be admired and exude not only a high level of experience, but common sense and discipline, which I believe permeates everyone. Your definitely a source not an alternative. Again I thank you for all you do.

  165. Tiho

    Commodities bottomed in December. Don’t worry about any technical mumbo jumbo. Just buy the pullback and short the Dollar rally in coming days / weeks.

  167. Rob L

    Danno,

    I don’t think you should be the person to tell people to leave this blog – no one should be that person, aside from Gary.

    I have read a few of Tiho’s posts, over the last few weeks, and have found them to be quite informative. He is no troll.

  172. Rob L

    Danno,

    I believe a warm cup of milk, an animal cracker and an episode of Sabrina The Teenage Witch is what ails your weary soul.

    Just a typical Saturday night for you.

  174. smartbullion

    Tiho’s comments regarding currencies have been interesting for me. Although I could see how he could wind people up too. Hmmmm…I wonder where basil is hiding out

  176. Tiho

    I add my views which are quite informative. No one has to agree, but it might help someone. Write ones views out is self-helpful in the first place. This has been my point of view over the last several weeks:

    When one follows currencies, one should take a broad look of how the Dollar is performing – similar to breadth in a way. Obviously, the same should be done for the stock market too.

    So keeping that in mind, and looking at the Dollar across the board, we can conclude, from many many posts I have written here, that the Dollar has topped already. Therefore, most likely commodities have already bottomed, despite any “technical head & shoulder” warnings.

    If we look at the breadth of the CRB Index, we can conclude that energy bottomed in October against the Dollar, just like S&P, Junk Bonds, Asian & Commodity currencies did too. Next came Agriculture in middle of December and finally Industrial Metals and Precious Metals in late December.

    Agriculture is the main competent of the CRB / CCI index, with a weight of 40% or more. Therefore, its bottom in December, most likely marks the true bottom for the whole index. I’m long Agriculture in middle of December, for those reasons, plus many others.

    Unfortunately, where a trader makes a mistake, is looking at the DXY / UUP index, which is very connected to Euro and Pound as a huge weighting. There are no components from BRIC, Emerging Market or Commodity Currencies apart from the Canadian Dollar.

    Euro and Pound currencies are very sick, just as sick as the Dollar really. But since currencies relative, these three ugly sisters move against each other with real progress in either direction. You will notice that many currencies bottomed in October against the Dollar, while Euro didn’t. So it “appears” that the Dollar Index and Stocks have been moving up since October. But the truth is, the Dollar was only strong against the Euro, and weak against almost everything else!

    Focus your attention away from the Dollar Index / Euro / Pound, and you will come to a conclusion, especially using sentiment as well, that most likely commodities have bottomed in December and the Dollar has topped in a period between early October to middle of January breadth wise. I am short the Dollar since middle of January, using a proxy through Swiss Franc, as that currency has been beaten down the most in a forced “peg-like” manner which will not hold for long.

    We are now entering a third bullish rally since 2009. Risk assets like equities, currencies & commodities, leading economic indicators, central bank balance sheet expansions and most importantly credit markets are all in harmony. The investments to hold are:

    – long commodities due to secular uptrend
    – short dollar due to secular downtrend

    Sure, there are overbought levels for some risk assets and you shouldn’t just rush out and buy something Monday morning as there is a scope for a correction. During that correction, Dollar rallies a bit.

    But to talk about Dollar (as in DXY / UUP) making new highs, is shorting the Euro – which is way overdone – and picking head & shoulder tops in commodities after a bear market just bottomed, and money printing has re-started, while all credit markets show signs of improvement, seems “unprofitable” to me.

    Now, I don’t think that is a troll post. You can agree or disagree with everything I wrote here, but at least it might be useful to someone.

  178. Unknown

    As just an average investor who subscribes to both Gary and Doc I prefer Gary, by far. Doc’s site is on the cryptic side unless you are an experienced cycles trader.

    As he has clearly stated, Doc trades for a living. He posts his trades on a site, makes a few very brief comments about what he things may or may not happen, and says follow me if you want to.

    OTOH, Gary realizes that the vast majority of his subscriber base are average investors, he takes a great amount of effort and posts to keep them out of trouble by warning them off risky trades, his site and posts contain volumes more information regarding cycles and how they mesh with fundamentals than does Doc’s, and his trades are more conservative and designed more to give his subscribers the best risk/reward ratio on his trades.

    I have been reading (lurking mostly) on Gary’s SMT Premium site long enough to know that when he says he is in it to help people make money and stay out of trouble in these markets, I’m confident that is exactly what he is doing.

    Perhaps I don’t know enough about cycles yet, but I can’t say the same about Doc’s site.

    I don’t know anything about Poly so am not able to comment.

    For this investor, I’ll be renewing with Gary and dropping my trial subscription with Doc.

  179. Gary

    The problem is that oil, just like stocks is now due to move down into an intermediate degree bottom. Unless gets its act together real quick, then this intermediate cycle is going to be left translated.

    If the oil cycle fails then the CRB is going to break down to new lows and we are going to get the true 3 year cycle low this spring and not in Oct.

    Until the dollar index reverses the pattern of higher highs and higher lows I’m not prepared to call a top. It is still early in the three year cycle and usually the rally out of a three year cycle low will last at least a year.

    We have to see where everything goes when the stock market drops down into its next intermediate bottom. Until that event occurs its just too early to make any grand calls of dollar tops or commodity bottoms.

  180. Danno

    Cycles and Sentiment are forms of Technical Analysis. They are pattern recognition. Calling TA ‘mumbo jumbo’ on a site like this is only something a troll would do.

  181. SF Giants Fan

    Gary said

    “On the 3rd volume was to the downside and it was just as heavy the week before. The turn was confirmed until Friday.”

    TVIX traded 16 million shares on Feb 3rd the highest EVER traded.    That was said real time without the aid of hindsight that you mention so often.  

    WW thx for the mention.  

  182. ...at ease

    I haven’t seen anyone on this site get every move in the market 100%. However, I would think that whomever you choose to follow into a trade, you better be sure you agree on those reasons before you take the trade, because it is your trade and your money you risk. Gary, Doc or Poly may disagree on market direction right now, but the one thing they do agree on is risk control and is planned out in their various types of trading.

  183. Unknown

    SF Giants Fan-

    TVIX just traded 30 million shares on Friday, 2/10.

    I have no idea if that was the highest volume ever but it was almost twice the volume of TVIX on 2/3.

  185. SF Giants Fan

    Unknown

    Please re-read my post. It should make sence. I had no way of knowing the volume 7 days in the future. The point was at the time it was the highest ever traded.

  186. don

    seems the smartest ppl are the ones who start subscription service..atleast you get a nice 5 figure income which is much better than any other normal job..dumbs like me who struggle in market lose on both ends..in market as well as paying for subscriptions..and what i am annoyed is same type of concept but 3 different subscriptions..

  187. Bill

    Was out all day riding in the freezing Japanese winter – my body broken – brain drained – pulled up some daily 2 yr charts of $GOLD and $USD, and now I think $GOLD will go down and the $USD up, at least on a daily basis.

    Day to day I have no idea, but it looks like these 2 are in sync after all, and that their turning points match up.

    How long the dollar goes up I have no idea, just it’s turning up now, and gold down.

    Check out 2 yr daily charts. The $CRB is also interesting. The $HUI is screwed though. I hate the $HUI!

  188. JEFFtheFLEA

    unknown

    im with you … gary is better

    1) more interaction
    2) safer
    3) keeps in mind the new people
    4) and the interaction with argumentive people is very educational.
    this list should be much longer, but its 4 am

    thankyou gary for smt

  189. don

    Also gary or doc plz do not say that your service is to help people..you charge for the service..and your income must be north of 500K just from subscription..i am not sure how much profit you have earned in absolute terms from trading…if ur absolute trading profits are north of 10 mil then i can say that subscription income is just 5% of your total income..and even then 5% of toal income is substantial amount..and you all must admit that you CAN NOT call it helping people..its a plain PROFESSIONAL RELATIONSHIP..its a Business-to-Consumer model..nothing more nothing less…personally i don’t see anything bad in charging for subscription..but then i am not sure why you people don’t admit it and hide behind words like helping people…

  190. don

    ofcourse above comment is applicable to Poly too..personally if i would have been so smart in trading, i would have started a service..cos it has a fixed income which help offset your trading risks..

  191. GottaHaveIt

    I have not posted here for a LONG time, but I felt I had to say something about the people who are somewhat critical of Poly for getting into the paid subscription biz. I say “the more the merrier!”

    I have personally made a TON of money (+195% 12 month return ending Jan 31, 2012) by following investing tips from Gary, Doc, Poly, Alex, BobLovesHawaii, DG and a few other frequent posters on this blog.

    NOBODY has all the answers!

    Knowledge is power and the more info you can get the better.

    I’ve been a paid SMT subscriber since March 2011 (lurked for 2 months before that) and I’ve subscribed to Doc for almost as long. I plan to keep both subscriptions forever.

    I just joined Poly’s subscription service today.

    Poly has an incredible track record!

    Many of you may not know that Poly was up something like 600% in 2010 based on his gold trading.

    I have personally made a LOT of money by following Poly’s option calls at DCL’s.

    But nobody is perfect. Both Gary and Poly missed the gold bottom in late December, but Alex nailed it.

    That’s why it is important to have MULTIPLE sources of investing information.

    I realize that some people here can’t afford it, but if you are SERIOUS investor I think you should subscribe to Gary, Doc, Poly and any other investor with a great track record.

    Then you have to pick and choose who you follow on any given trade
    because they will often conflict with one another.

    I know many of you follow Gary’s model portfolio exactly and if that works for you, great!

    Others do your own thing (WW I’m looking at you) and do very well with that.

    There is no “right” or “wrong” way to invest. You have to find what works best for you, within your personal risk tolerance level,
    and always remember that NOBODY is going to be right all the time.

    Gary provides a great service, and we are all very lucky that he allows free and open discussion on this blog. If you are one of those “lurkers” hanging out in the blog comments sucking up free investing advice and NOT paying for a SMT subscription, shame on you! Come on, it’s dirt cheap compared to the money you could/should
    be making from what you learn here.

  192. Danno

    The issue is not other subscription services. The issue is trolling for subscribers on someone else’s board. As a reader it annoys me. I can’t imagine how annoying it must be for a site’s owner. And yes it is possible to for a person’s primary goal to be helping other people in spite of the fact that the person may ask a fee for doing so. The notion of helping others is the best reason to start a business. In fact, if your goal is not to help other people then you should never open a business.

  193. jabalong

    Don’t comment often, but just wanted to chime in and say that as a subscriber to Gary, then Doc and now today to Poly, there’s plenty of room and it’s not a zero-sum game. I welcome having a few coaches and am happy to maintain several subscriptions.

    Don’t know what the etiquette is or should be on commenting on each other’s sites, but as a subscriber discussion is always welcome. As I mull different reports, I often think it’d be nice to have more of these guys talking to each other and bouncing views off each other.

    But I can see how that might be delicate so as not to step on each other’s toes and maybe it makes more sense for each to work in isolation so as not to have their analysis unduly influenced by the others’. I don’t know, there are pros and cons to either scenario.

    Whatever, it’s all good and I’m sure these likeminded services can happily coexist as we all make money going forward into the next few years of the precious metals market in particular.

    I was very happy to find Gary over a year ago, which led me to Doc and Poly and everyone else in this little community of communities.

  194. SF Giants Fan

    Arun

    I agree. I like Gary much better because of the risk adjusted return. Buying a 3x ETF is not in my risk tolerance even though it was a very small %. And yes, many did miss the 12-29 bottom because Everybody said gold was going lower. I think WW called it and a few others.

  195. SF Giants Fan

    Arun

    Yes it was WW.

    SF Giants Fan said…
    It seems like EVERYONE is waiting for gold to hit the $1400’s. Not just this blog but many others (except doc). And you know what happens when everyone is waiting for the same thing. It never happens. I hope I’m wrong…

    January 4, 2012 6:28 PM

    William Wallace said…
    SF,

    Im not 🙂 Am I the only one who is long gold right now, is Doc long?

    January 4, 2012 6:32 PM

  196. kmisak

    SF Giants, thanks to that post of yours early Feb. Due to that post, I began to finally look at and figure out the VIX index. It led me to buy with both fists on the 8th, at the beginning of the upturn, so thank you for that astute observation! How the market got so complacent is beyond me. It appears the news cycle is turning, and it may be time for the ‘widowmakers’ (TVIX + HVU.T) to shed their shrouds and let the volitility party start again – until of course evryone gets too greedy and the widowmakers make widows again… Check out TSI Trader and technicalmarketsanalysis; both these guys called it accurately, and could provide guidance for the trade.

    Good luck and good trading (standing by my man – Gary, except hard to take the UUP trade in Canada, for the only etf has zero volume).

  197. SF Giants Fan

    Kmisak

    Thx, but i will pass the credit to  Tom Demark  on TVIX.  That is when the volume started to surge. Please do not get greedy with any volatility ETF.  It was up > 30% on Friday at the high and it can fall just as fast.  

  198. Gary

    SF,
    Yes but it was selling volume and we had 10 other days prior to that with above average selling volume. None of those were confirming a bottom. It wasn’t until Friday’s heavy upside volume that we had confirmation that a turn had likely occurred.

  200. Gary

    don,
    Last year I paid off my weightlifting coaches house for him. He was struggling on a fixed income.

    Several of my friends leveraged too heavily and got caught in the silver crash and lost most of their life savings. I recapitalized their accounts.

    Most of my climbing friends are young and can’t afford health insurance. I pay their medical bills for them.

    And until recently I sponsored the weightlifting team. Since Nationals is in three weeks sponsorship just ended as we don’t know who is going to stay and who is going to leave after nationals.

    I also contribute to various animal shelters.

    I find it rather offensive that you think I’m only in this to generate subscriptions. I’ve given away most of the proceeds from the newsletter.

    If I wanted to I could easily jack the price of a subscription up to $1000 for the service I provide. I mean honestly how many other newsletters in the world have delivered the kind of risk adjusted returns that the SMT has?

    I think we all know the answer is none.

    I’ve given away most of the profits from the newsletter and I have to put up with the constant whining from traders if a trade isn’t timed perfectly and now I have wanna be newsletter writers using my blog to generate subscribers.

    Is it any wonder I get a tad upset when others come on the blog make big calls against me, never bother to explain their reasoning, and claim it isn’t to generate subscribers? If you are going to make a call then tell us exactly your reasons so we can judge for ourselves. People shouldn’t have to subscribe to your letter to find out why you think the opposite. If you don’t want to give away subscriber information then keep your calls on your own site.

    If you want to build a business then do it the same way I did. Do your own advertising and if you provide a valuable service then you will gradually build a subscriber base over time.

  202. ALEX

    Gary

    I think you are a straight forward and honest guy, so I dont think you would make up anything just to “make a statement”…so I DO believe what you wrote about some of the proceeds from the newsletter.

    I just wanted to commend you on your generosity.

    And I appreciate this comment that you wrote…”I also contribute to various animal shelters. “

    GOOD TO KNOW

    THANKS

  203. JEFFtheFLEA

    gary

    I just cant thankyou enough for this site. I couldn’t follow sentiment trader and figured out how to use it to trade. Now i know its a great compliment to other tools. Cycles are still hard to count and see by myself.
    Just now understood what breath is ( more than just a line).
    I should go on and on, The hand holding/ repeating and deeper understand you provide makes your site invalueable.

    My broker ( who i buy a subscripion for and he does follow you) just made the comment this week how far i have come. At this point when i check in i give him the rundown and what i am trying to do. I run the ideas by him for a sounding board. He is great and pulling for me, but you are the middle between us for being likeminded and on that link we will correct each other and keep on track.

  204. alexi

    Gary, don’t be upset. You are right! You work very hard on build your sub base. I still remember that you were told he was a troll in SOH site in 2009. Too bad I didn’t follow you until now.

  206. Elaine

    I think Gary’s writing style is better for inexperienced traders. Doc’s style is cryptic and a bit harder to translate. Poly will take short trades like SDS.

    As others have indicated, getting different perspectives is a good way to educate yourself.

  207. sophia

    I think that Gary does a terrific job and as you said Elaine, he is great with inexperienced traders, but he is also great with experienced traders.
    He is patient, polite and caring.
    Doc’s letter is more cryptic for those with no experience, and Poly writes like a day trader ( no offense Poly, but you are sometimes difficult to follow!).
    BUT, all of them are contributing to make all of us better at trading and better at doing it with less tools than the Goldman guys …and better returns!
    So, kudos to Gary, Doc, W2, Alex, Poly, DG, SF Giants,jhNewman and others who make investing fun.
    I feel that thanks to you guys, I am part of a big community of gentlemen/women traders!!
    LOL

  208. Gary

    Bob,
    I’ve learned my lessons the hard way. Almost nothing emerges unscathed when the stock market moves down into an intermediate degree cycle low. Next week will be the 19th week of the cycle that averages 22 weeks.

    Unless one can time a perfect top or thinks there will never be another intermediate degree correction it’s just too late to buy anything right now. Now is the time to wait patiently for that correction to unfold and then buy as close to the bottom as we can.

    That strategy will produce the greatest return with the least draw down.

    Buying anything right now will almost certainly produce a massive draw down unless you can time a perfect top. Is it really worth a jumping in front of the train to snatch a couple of nickels?

    It took me a while, but eventually I figured out one of the most profitable strategies in the world is to have the patience to wait for the right setup.

  209. Elaine

    Sophia, you are right. I didn’t mean to imply that Gary’s work is elementary, his writing style is just much more understandable.

    Also, for political / economic commentary, Mish is fantastic, and free!

  210. Unknown

    >>>> If you are going to make a call then tell us exactly your reasons so we can judge for ourselves. People shouldn’t have to subscribe to your letter to find out why you think the opposite. If you don’t want to give away subscriber information then keep your calls on your own site.

    If you want to build a business then do it the same way I did. Do your own advertising and if you provide a valuable service then you will gradually build a subscriber base over time. <<<<

    – Gary

    Yup! I could not agree more. Trying to build a subscriber base by using Gary’s free blog to lure his subscribers to one’s own subscription site by making calls against him ON HIS OWN SITE is about as unethical as anything I have ever seen. I am amazed Gary allows such posts from anyone. I have never seen it before.

  211. Bob loves Hawaii

    Thanks Gary, I totally agree. There are some sweet falling wedges out there that will really run. My big position is UVXY. Something is brewing, the volume in these volatility shares have my attention.

    I am glad to see your post on your giving. I tell everybody that if they get the chance to meet you face to face they should, you’re the real deal.

  213. MrMiyagi

    It is not relevant to me what Gary’s net worth is, we can all speculate what his income from the subs amounts to.
    He loves dogs and that’s A1 in my book, plus, try having a burrito with Cramer or any other financial service provider and see where you get at.

  218. William Wallace

    I always said, this blog consists of a team that flanks the markets from every angle and kills it. A well oiled machine that gets gunked up at times, but filtered out and the machine continues to run smoothly. I know for a fact that even the the head coach’s winning decisions are influenced by team players, benefitting everyone. The team need not forget this and it’s players keep their pride in check, or the team will break down.

  219. sophia

    well said William! Gary’s letter is the first letter I check in the morning and it is so reassuring and telling! AND, I feel that we are a TEAM!

  220. David

    I personally admire Gary for all he does for others, and have contributed to his weightlifters in part as a way of saying thanks.

    At the same time, I think that any one newsletter writer’s efforts will stand or fall on their own merits, regardless of whether they post on a public blog. Though everybody and his brother seems to be starting a service, Gary, Doc and Poly all stand above the crowd. I don’t think any of them represents a threat to one another, though the proliferation of market calls makes it difficult to take a position and hold it with any conviction.

  221. William Wallace

    SF,

    Anyone who is a good judge of character never needed for Gary to even make that comment to know what kind of a heart beats in the guy’s chest. Some people simply fail to realize that doing the right thing is often rewarded, and will always find a reason to be a hater.

  222. SF Giants Fan

    Sophia

    Wow thanks for the recognition, but I do not deserve to be listed in a group of such elite “heavy hitters” as l like to call them. I have learned so much in the last 2 years from the “heavy hitters”

    This blog is really attracting some amazing people with talent and you are right, it is one hell of a team.

  225. SF Giants Fan

    WW

    I agree. Too bad many don’t see Gary’s good side. They just think its a scam to get more subs.

    Oh I know next week the markets are going to be rocking, but don’t forget tuesday is valentines day 🙂

    Spend some of those profits on your lady.

  229. Phil

    Looks like Seabridge (SA) daily chart is forming a perfect cup and handle…and nice little bull flag as well?

    I’m fairly green wrt chart analysis…any feedback would be appreciated.

    TIA

  234. TZ(8155)

    >Something is wrong with the miners. Since Jan 1, SPY is up 7%, GLD up 10% and SLV up 20+%. But GDX is up only 6% – even lower than SPY.

    Oh..you mean the same thing that has been wrong with the miners since 2004? Yeah, I guess that is weird. Who could have suspected?

    These things come right out of the blue sometimes.

  237. Bill

    Phil, agree w/your assessment of SA. But given what happened to HL and AEM, I myself shy away from buying specific miners because I don’t have 1st hand knowledge of their mgmt team and ops. So I play the diversified ETF, SIL. And SIL looks a bit like SA, though SA sure has cleaner price movement. Good luck.

  238. Elaine

    I think one reason Gary is tolerant of other opinions like Doc’s and Poly’s, is that he is pretty confident in his own decisions, but yet is smart enough to recognize that others may have valuable input.

    As far as what he does with his money, he can spend it all on bro’s and ho’s and it’s really none of our business.

  240. Phil

    Bill,

    Just based on what they have in the ground SA is seriously undervalued….BUT….how many times have we heard that before??!!!!

    Thanks for the response.

  243. ILUVPMS

    Gary, are you still waiting for a stock market crash and a lower low in gold… Im guessing you do not assume December to have been the bottom. In any case, as I’ve repeatedly previously.. its better to be in than out.. I just don’t see how the market is going to “crash” when qe3… to infinity is there…. you are assuming that during an election year the numbers won’t be inflated to support obama?

    The markets will be chopping until march, june the latest but all hell will break loose. The pm metlas should decline until next week from a cycle perspective (maybe until the 14) but then again… cycles don’t tell you weather its going to be a down or an up transition.. just that a turn is happening.

    best of luck to ya all.

  245. thedocument

    Don,

    You way overestimate the financial benefits of a newsletter service, at least for me. The primary reason I write a newsletter is because keeping a trade journal is an essential part of trading, and doing so publicly forces me to be astute in my thought processes. While the income is certainly a benefit, the main reasons I charge for the newsletter are 1) to keep the riff raff out, and 2) because it would be unethical for me to give away for free what others who introduced me to cycle methodology charge for. In fact, last year I raised rates to slow down subscriber growth. I want a community of serious traders who can converse intelligently about their profession, not people who simply want hand-holding. So far, I have been quite successful in this objective, as my Members generally post very thoughtful and educational comments internally. My career objective is to be a very successful hedge fund manager, not a successful newsletter writer, but I have found these tasks to work quite well together.

  247. thedocument

    ILUVPMS,

    There is no way December cannot be an ICL for gold. We just saw a daily cycle form as RT, and RT daily cycles do not form during intermediate declines, by definition.

  248. Bob loves Hawaii

    If you look at the last two QE’s, you saw an uninterrupted run higher, a selloff (mild), then a race to new highs. Afterwards, a real selloff. My view is we are at the first selloff stage again.

    Also, the McClellan report posted on the Eurodollar futures and how this offsets a year ahead of the market. Scary accurate. February 3rd report. It is calling for a top, drop and chop until June, then a boom.

    Regarding SA, it hit my buy screen, but am hesitant to promote it because they don’t yet produce.(which means this baby is going to the moon)

    I will buy a breakout tough, because it has a lot of upside potential.

  249. thedocument

    Gary,

    I am not trying to make any calls “against” you, and I have stated the reasons for my calls here freely. I would have also been quite happy to elaborate if anyone, including you, responded in a more inquisitive manner. I enjoy the challenge and respect your opinion. In fact, despite having developed my own views and techniques within cycle methodology, I still read your letter because I know I am not right all the time. I certainly hope we can return to a more stimulating exchange.

  251. Bill

    Phil, I remember the CEO of AEM on TV w/Cramer saying how much gold is in the ground for them. Cramer was so bullish on AEM that he switched from supporting EGO to AEM. Then the floor fell out. I’m not sure the story of HL, but living out here in Asia I’m aware of miner strikes in Indonesia that affect NEM, BHP and others. The more I learned the more scared I got. Luckily SIL performs pretty well, and trends somewhat similar to SLV. Good luck.

  252. Bill

    Gary, theDoc, I don’t know if others would benefit, but in the interest of educating non-cycle believers like me, maybe you could make a new article for us to explain the different cycles views of the markets.

    FYI the fact that there are different views further enforces in my mind that cycles doesn’t work – there can’t be 2 high tides in a row, type thinking. Reminds me of EW’ers recounting and recounting. But I honestly remain open minded and would welcome the education.

    I know that cycles is only part of the equations that you 2 use, and that you are both great traders in your own right. Teach us cycles!

  257. Phil

    USD leaking lower…will be interesting to see how gold opens…

    Thanks for all of the feedback on SA…usually Cramer is a good contra-indicator!!

  259. William Wallace

    Doc said:

    “We just saw a daily cycle form as RT, and RT daily cycles do not form during intermediate declines, by definition.”

    The majority of A-waves (advances following parabolic corrections)are single RT powerful daily cycles.

  260. Bill

    Phil, agree on Cramer. I still listen to him though because he’s former GS and Harvard.

    Be sure to read the comments from Bob from Hawaii above. Looks promising.

  263. Bill

    WW, I’m stuck in the mud on cycles. So what’s next for gold (on a daily basis)? Are we topping here, then a brief down? Brief as in 1 week down or something? Thanks.

    FYI though I look at 60/30 min charts, I trade off the daily, so your thoughts on what’s happening on a daily or weekly basis are much appreciated.

  264. thedocument

    William Wallace,

    That’s a different issue. You can argue that a new intermediate cycle has already peaked, but one cannot deny that December hosted an ICL.

  265. William Wallace

    Bill,

    Friday’s post.

    “If gold chops around at this level for the rest of this session, I expect out of the open Sunday night we will see a test of the 1735 area, if the DCL is in front of us we will most likely see a reversal at that level (if not before) as gold continues to fall out and attack the 150dma. If the DCL is behind us we should see gold move above $1735 fairly easily and push higher…I have some targets for a top in mind for the next DC.”

    February 10, 2012 9:00 AM

  266. MrSu

    Wow…Anyone that thinks Gary is in this to make money off of subscriptions either hasn’t been paying attention or isn’t a sub.
    He is of the highest integrity and it is evident that he has his subscibers’ best interests at heart. He spends countless hours on analysis and answering questions at all hours of the day night on his blogs.

    Gary is Priceless!!

  268. William Wallace

    Doc,

    I never said DEC wasn’t an ICL, I actually called that exact bottom months in advance. The issue here is that it doesn’t matter if this IC formed as right translated. Over the last 10 years it didn’t guarantee a second DC, being the majority of advances following parabolic corrections were, like I said, single RT daily cycles within short 5-8 week IC’s.

  269. Bill

    WW, I remember that. But soon after you wrote that you were out of your long (February 10, 2012 10:25 AM). And then later you wrote back to me that gold might put in a deeper DCL (February 10, 2012 2:07 PM). Then you said you might be long Mon am before I wake up, and then short the same day (February 11, 2012 4:27 PM).

    Am not trying to play lawywer on you buddy 😉 I see your day trading style – I was wondering where you see gold at next week Friday, type thing. On a daily chart, is gold topping as the MACD suggests (and cycles I think) or is it bottoming and about to push higher? Just wanted your take is all. Thanks.

  273. William Wallace

    Bill,

    What I was saying on friday is that if gold moves above friday’s high of 1737, we will have another swing low, which I believe has a good chance of marking this daily cycle’s bottom and we should see gold test the 1766 high. Whether gold roles over before making a new high (above 1766) is the question.

  275. Bill

    WW, I see.

    How would you put it in wave ABCD terms? Like, are in (or just finished?) the A wave out of the Dec ICL that you called. And next (or now?) is the B? And B is over when it pushes above 1766?

    Thanks much.

  276. Gary

    B-waves are corrective waves. We may be in an A-wave that has or hasn’t topped yet. The B-wave when it comes will correct 50-90% of the A-wave advance.

    There is still a small possibility that the D-wave isn’t finished and the last leg down will be triggered when stocks move down into an intermediate cycle low.

    I’m not very confident this is the case but if we get a hard intermediate correction in the stock market it could happen.

  277. Bill

    Gary, thanks for that. OK, I’m on board here. I missed my own signal to buy in early Jan, so am hoping/waiting for a good correction.

    Gary, I can’t get it though my head yet why smart guys like you believe in cycles. I mean, there is so much grey. For instance, right now it’s unclear if we’re in an A, or in a mini-B, or still in the D. I understand the logic for these 3 scenarios, but the fact that there is so much variation leads me to think that cycles is not a help on markets at all.

    Myself, a beginner, think that if gold goes above 1765.90 like WW says, that the correction I was hoping for won’t happen anytime soon, thanks to Ben. However, looking at 2 yr daily charts, and the MA lines and MACD (I use PPO), I honestly think that gold will correct down here, forming the end of the D. The dollar looks to be turning up and the Euro down.

    Anyways, I sure wish I could believe in cycles. I hate lurching around like a beggar on this site.

    The other thinking around your exit and entry points – sentiment, price action, and so on – are all really really great.

  278. Bill

    Applying cycles in other things, like the sun or moon or tides, if we know the current state, the next is predictable. For instance, after a low tide, the tide comes in, then we have a high tide. Perhaps the problem on market cycles is that we’re never sure what state we’re currently in, so there’s no way to predict the next. For instance, was Dec an ICL or not? Will we not know for sure until gold starts it’s C cycle? So the end of B confirms that D is finished? Very strange, this cycle stuff.

  280. Gary

    Bill,
    Despite my best efforts you continue to try and make cycle do something they are not designed to do. Cycles are a very poor tool for trying to spot tops. They are however pretty good at spotting bottoms.

    What they are really good for is telling us when we should step on the gas and when we should tap on the brakes. We have a classic example right now. This week will be the 19th week of the intermediate cycle in the stock market. That cycle runs on average about 22 weeks. Our cycles tool is telling us that it’s too late to be entering long positions.

    At this point, one needs to either be in cash or you could play the correction with a long trade on the dollar index.

    Continuing to play the long side may allow you to tack on a few more gains but unless you are perfect at picking tops you will almost certainly lose all of those gains when the stock market drops down into its intermediate bottom.

    Cycle analysis is the reason why I continue to warn people to step aside and wait for the correction.

  281. William Wallace

    Bill,

    Since last tuesday I have been talking about the “topping process” and made it pretty clear that I wasn’t convinced at all that 2/7 marked a bottom. When I mention the “topping process” I am watching it in realtime playout (this is what compelled me the day gold topped to say many may be about to be caught), thats how I recognize that a top is being formed, gold futures begin to trade a certain way, with recognizable characteristics of a topping process. Watching many tops form in realtime one can see this, this is what has enabled me to call tops. When I ignore what im seeing in realtime because I look too far ahead I fail to recognize a top, I failed to recognize the Nov top for and got out a day late (I was considering the bubble phase may have been just beginning)…I try not to look too far in advance, so when you ask me where gold will be by Friday remember that im intentionally near sited.

  283. Bill

    WW, OK got it.

    Gary, alright let’s arm wrestle this out. 😉 Pull up a 3 yr weekly chart of the $SPX. Major bottoms were in Mar 2009, Jun 2010, and Oct 2011. Trough to trough these are closer to 52 weeks apart, not 22.

    From the last weekly bottom of Oct 1 2011, we’re at week 19. That we agree on. 😉 But as I see past history, I think we have another 20 weeks or so before the S&P really tops – probably next May – “sell in May and go away”.

    If you told me that S&P cycles were 52 weeks apart, I’d be more likely too agree. But if the number is 22, I’d say not so the past 3 yrs. And w/Ben now warning us about QE3, and in an election year, I think we go higher. Much higher. Gold too.

    Anwyays, I’ll give you one thing: you are consistent in how you describe cycles. I’m a math/physics guy. I have no right brain too balance my left. Anyways, I won’t ask you anymore. heh heh heh! We share climbing and lifting and dogs, but not cycles! Good luck buddy! 😉

  284. Unknown

    >>>> In fact, last year I raised rates to slow down subscriber growth. <<<<

    – Doc

    It worked. If you have a large subscriber base, they are the most silent subscribers I have ever not seen on a subscription web site. If you get 10 posts a day on your site, that’s a lot.

  287. William Wallace

    Bill,

    BTW, I think I made it pretty clear since gold topped that im leaning more towards this being an A-wave top, but I will be long out of the next daily cycle bottom and see how things go.

  288. JEFFtheFLEA

    Bill
    I really pushed you alot to join, im sorry its a confuseing time right now. I thought we were going to ride the A wave like a surfer on the pipeline. Well this past C wave was the biggest ever (longest). So did the D wave already happen? was it really that mild and short? Gary was expecting more and i guess we stepped aside, and still there is a possibility of the D wave continueing. So right now A,B,or D is on the tabe. Pluse i think Gary is not as agressive anymore.
    I do know that when the time comes Gary will step on the gas and it will be unbelievably clear. Preserve capital now, kill later.

  291. Bill

    OK, let’s use that chart. If I look at it from across the room (as you once said to do), w/out the blue annotations on it, I see the same 3 troughs that I spoke of. Do you see them? And don’t they look different than all the other wiggles? They do to me, and maybe that’s the problem, is I’m starting at too many steps back. The blue annotations you have mark bottoms, but again the variations are too wide for me … it starts with 18, then 30, then 21. The average is probably 22 as you say. But if the variation is 22 +/- 10, then I just can’t see how you can use this to pick a bottom. However, all that said, I do believe that you do. I just can’t figure out what’s wrong w/my brain. All’s I see are the 3 major troughs, and then a bunch of wiggles in-between. And, importantly (for me), the next major bottom is still 6 months out, so that puts the major top somewhere around May I would guess.

    I don’t know. I just wish I could believe in this stuff, ’cause like I said, the rest of your stuff is really really good.

    Oh well, thanks for trying. Relativity is something that few can truly see, but yet I see it quite intuitively; but I can’t see this cycle stuff. Jeesh. Must have several flipped bits.

  292. Bill

    Gary, just read your note that there is a YEARLY cycle. OK, we have another agreement then. I am learning, though slowly and surely!

    Flea, I think Gary is just as aggressive, just he’s more cautious, is how I see it. HAVE NO DOUBT that if he see’s something, he’ll go long 75% w/out any hesitation.

  295. JEFFtheFLEA

    bill

    1) you have a window for the time frame
    Now we have a timeframe ( window for a bottom)
    2) Sentiment at that time matters
    3) RSI , watch the transports (for the snp) or (miners for gold) or what ever the other clues are within the timeing. Breath, MACD, ect.
    Thats how a yearly cycle is picked . It does not fall 365 days apart, it just tells you pay close attention NOW. =)

  299. Bill

    WW, I’ve figured out your secret.

    You have 100 Cray supercomputers in your closet, and you’re front-running orders on gold.

    It’s either that or a time capsule – zapping yourself ahead in time 10 mins, then back; repeat.

  300. Russell

    Unknown,
    Doc has been a respected contributor to Gary’s site for some time. When I found Gary about 18 months ago, I learned that many on this site have opinions worth hearing. My favorites are Doc, Poly, DG, Alex, TZ to name a few, but I leave out many that I respect based on the arguments they present. It is especially helpful when they express differing views in a respectful interaction with Gary. Doc is even mentioned on Gary’s site as “my blog list”. This is how I found Doc’s site. When someone disagrees on this site, it is more beneficial if the facts are argued rather than to question motives.

  302. Unknown

    Not questioning motives, Russell. Just stating some facts.

    Granted, I am a relatively new sub to Doc’s site. That said, I’m astounded at how little information he provides and how few posts there are from his subscribers. After lurking for 2 – 3 weeks, I came to the conclusion he has a very small subscriber base. No way for me to know that, of course. I just came to that conclusion from the lack of much, if any, interplay and communication between his subscribers and between his subscribers and him.

    If he “wants a community of serious traders who can converse intelligently about their profession, not people who simply want hand-holding” it appears to this newbie he has been an abject failure. What few posts he gets are the same kinds of posts/questions that Gary gets.

    Just my observations. If you see things differently, you are seeing something I’m not.

  303. muttonfish

    The biggest advantage of SMT over other sub services is that Gary offers a cloud bunny at the top of each and every newsletter.

    Folks, you just cannot find that kind of value anywhere else.

  306. Russell

    Unknown,
    I’ve been a subsciber with Doc and Gary as they compliment each other. Many of those that comment are active on Gary’s site. I have never asked a question to Doc that was not answered. Maybe Doc’s followers are less talkative, and that can sometimes be refreshing,especially when nothing has changed in the setup that Doc outlines. You might want to
    check out this site. Very few comments, but he conducts a nice discussion re current interpretation. It’s free and I learned about it from someone on this blog.
    http://likesmoney.dojispace.com/

  310. Bill

    Just stepped outside, thinking on what you said, and I figured out the flaw in the cycle logic.

    You wrote:

    “Bill, Despite my best efforts you continue to try and make cycle do something they are not designed to do. Cycles are a very poor tool for trying to spot tops. They are however pretty good at spotting bottoms.”

    But just ahead of that:

    “B-waves are corrective waves. We may be in an A-wave that has or hasn’t topped yet. The B-wave when it comes will correct 50-90% of the A-wave advance.

    There is still a small possibility that the D-wave isn’t finished and the last leg down will be triggered when stocks move down into an intermediate cycle low.”

    So on one hand, cycles are supposed to help one pick bottoms. Yet, can’t say for sure yet if gold D bottomed or not, even though that was 1 1/2 months ago (per Doc, the ICL). Both statements can not be true at the same time.

    At least in this 1 universe. 😉

    Please explain how cycles can pick bottoms, yet we can’t say for sure if Gold had it’s D bottom or not yet, 6 weeks later. Can’t happen.

    Sorry to pick a bad day to drill into this, by the way!

  313. riley

    WW you hooked me again, lol, how do you spot daily bottoms. I only scalp after a retest of a ? bottom then buy on first move off with tight stop. And vice vercer. If I don’t get a retest I let the day go. No long term futures trade at moment as await confirmation of dcl and s+p icl.

    What do you notice different at bottoms? Thanks

    Gary you are true person for helping your friends like that. Thanks to you also.

  314. alexi

    Doc is a very intelligent investor. He is humble, smart and humorous person from what I observe (I am a sub since 06-11). I don’t think his sub base small and his subs are very experience and sharp. That includes good traders like Rosabarba, Tjrand. Txtraveler… They offer extremely valuable comments (of course, every words are golden 🙂 The funny thing for me is my English get better everyday by reading Doc.

  315. Bob loves Hawaii

    Hey Bill, there is a concept of missing the forest for the trees. It is keeping you from making money with Gary. You are trying to find absolutes in a world of probabilities. Timing bands have a very good record of identifying bottoms, tops are a moving target, but Gary is saying is to start scaling out or bailing out as he does, once you are in a timing band, as the probabilities support a reversal. The goal is to consistently make money not make the most money, that is when (I) we lose money.

    If I am being presumptuous, just ignore me. But cycles overall have been a winning strategy.

  316. Bill

    Flea, I’m w/you man. The 2 yr daily gold chart tells me that we yet be in for another lower low, because the dollar is making higher highs.

    I will say though that despite this funk, that Gary’s done a good job protecting his subscribers, as you noted earlier.

    Me, I don’t have a frickin’ clue as to what’s going on. Am trying to follow the trend – but missed the buy signal in early Jan – am hoping to use cycles if they would just work (for me).

  318. William Wallace

    Just wanted to make a correction to my earlier comment below to clear it up.

    “Doc,

    I never said DEC wasn’t an ICL, I actually called that exact bottom months in advance. The issue here is that it doesn’t matter if this IC formed as right translated. Over the last 10 years it didn’t guarantee a second DC, being the majority of advances following parabolic corrections were, like I said, single RT daily cycles within short 5-8 week IC’s.”

    It was meant to read:

    The issue here is that it doesn’t matter if this DC (Daily Cycle) formed as right translated. Over the last 10 years it didn’t guarantee a second DC (second DC within A-wave), being the majority of advances following parabolic corrections (A-waves) were, like I said, single RT daily cycles within short 5-8 week IC’s (weeks to top).”

  319. Bill

    Hi Bob. You’re pretty much correct. I like how you use the word “bands” as that allows for some variation. But is it normal to know or not know if gold has bottomed some 6 weeks after the fact? Isn’t that kind of a major unknown?

    FYI I totally see that this is a game of odds, that that Gary uses cycles to improve the odds in his favor. And you’re right that I prefer absolutes. But I’m fine w/odds of like +/- 10% or even 20%. But having timing bands on the weekly S&P that are off by as much as 50% is insane (though not criminally insane! 😉 You gotta agree man.

  320. Bill

    Gary, you mean that ABCD’s don’t follow major cycles?

    Oh boy, that just blew me out of the water. Good luck with that, man!

    Man, remember when Ptolemy had this complex model explaining how the earth was at the center of the universe, with this massive physical model with all these exceptions and such – and then along came Copernicus with his simple heliocentric model, with no exceptions, and suddenly it was clear what was happening?

  321. Phil

    Given today’s geopolitical environment, do you guys really believe that gold will be lower in terms of USD/oz. At the end of this year vs. now?

  322. Bill

    Einstein: “Everything should be made as simple as possible, but not simpler.”

    Works for me.

    Thanks Gary, Bob and WW for your support. I’ll be in the back seat w/Flea.

  323. ver

    Doc:

    If I recall, you are expecting an intermediate cycle low in the stock market several weeks later than Gary is. Why is that? I think that would go a long way in explaining your relative comfort with going long for a second daily cycle in gold.

    WW:

    Nice investigative work on A-wave durations. That data point alone warrants serious caution, let alone if we’ve just seen an intermediate top in stocks and an intermediate bottom in the dollar.

  331. MrMiyagi

    Visiting family in Montreal before changing search location; put n 10lbs eating crappy foods in hotels, I won;t even start on the costs…
    Wednesday we will start to look in Alberta. Lower taxes, better economy, cheaper houses than BC.
    Any reno work lately?

  332. William Wallace

    I hear ya, hopefully you’ll get settled soon. Little bit of lighting left to do, been sheetrocking a bit, trying to get a few things done before surgery, most likely have everything done after I recupe.

  334. TZ(8155)

    Doc and Poly are long looking to add at whatever low we get in the next few days. I’m not long but looking to go heavy leverage

    I think it is a mistake to not risk 1-3% net worth that the prices from Jan 25th’s surge upward will hold.

    That move up was on high volume, broke higher from an up wedge (usually a topping pattern) and also broke over the main daily chart downtrend line.

    That move looks solid and I think it is a REASONABLE BET to buy expecting that move to hold.

    There is a GARY/SMT faction here that appears to be looking for lows back down at 15XX zone.

    That may happen, but I think not having a contingency bet (buying this next drop here in the 1700 range with a set risk) is just asking to be left behind on a possible continuation higher.

    Just saying.
    Ask yourself “What if my plan is wrong? How will I recover and what will is cost me”

  336. TZ(8155)

    I’m discussing gold in my post if I didn’t make that clear.

    I intend to add gold futures 2x-4x on a drop below 1700 (which looks to be the zone I think makes the best bet.)

    The exact trade(s) will depend on the action at the time. “Below 1700” is just an estimate. 1685-1700 is where I think any decline will stop.

  338. ver

    TZ:

    We just touched 1706 on Friday. If you didn’t buy then, what are you looking for now in the “1700 range”? It seems unlikely that a trip back down to the 1700s would stop there, unless you envision a low retest.

  341. William Wallace

    Ver,

    I agree, I dont see gold stopping at 1700 if the DCL is still in front of us. If the 150dma is breached, below that we have both the C-wave 23.6% and the current Daily Cycle 38.2% Fib levels at $1673, which is also the 11/22 DCL pivot.

  342. Danno

    I’d need a lot more confirmation before I’d even think about going long PMs right here right now. Better to wait a bit. ‘Missed money is better than lost money.’

  343. Rob L

    TZ,

    What will you do if last Friday’s low of 1705 is the final low for this DC? Will you chase on a DC confirmation?

    With the news that the Greek parliament passed the austerity package, the dollar could very well be pressured again early this week and begin its decent into a ICL and gold heading quite a bit higher from here.

  344. ver

    WW:

    Indeed. One has to respect the weekly swing high on gold as well. A move above 1755.5 would negate it but by then we will be even deeper in the timing band for an A-wave top based on what you’ve found.

    A time for quick hands.

  347. Danno

    Rob L, That is ‘Scenario Trading’. Everyone has been warned not to scenario trade. The market can easily shake off good or bad news. Besides, many believe Greece cannot actually follow through with its cost cutting promises. The vote is no guarantee that markets will move up or down. It’s just more noise.

  348. ver

    Based on WW’s analysis we’re likely 0-2 weeks away from entering a B wave or, though less likely, still in a D-wave. Both of those should host deep selloffs over the coming several weeks that will present attractive buying opportunities relative to the gold trend — be it the beginning of a C wave or an A wave.

    I’m afraid folks (including me) who missed the run from $1500s to here are eager to make up for it but the unfortunate reality is that the easy, low-risk profits have already been reaped. The ones lucky enough to have profits from this run have earned the luxury of taking a bold stab at a potential 2nd daily cycle here but for the rest of us it ought to be a very carefully calculated risk given all the cross-currents at play.

  349. Gary

    Folks a missed opportunity isn’t the same thing as losing money. There will always be another opportunity.

    Even if the A-wave continues there will still be a B-wave after that. If you don’t time the top of the A-wave correctly you will get caught in the B-wave.

    If you think you can pick the exact top of the A-wave then by all means push the long side as far as possible.

    I don’t trust my ability to time the A-wave top and I’m more worried about getting caught in an intermediate degree correction than I am about trying to catch all of the A-wave.

    We already caught almost the exact bottom and exact top of the move in miners. That’s good enough for me.

  350. TZ(8155)

    VERONICA,

    >TZ, have you ever done a backtest on parabolic sar? If you would have, you would find that the wins are only 45%. Not exactly a great % to build a long term strategy on. I have always said my system does use elements of sar but is using other parameters also. How would you explain my system when it holds wityhout a stop? Can sar do that?

    My discussions of what you seemed to be doing were, first, simply light competition. It’s hard to not try to figure out what people are doing.

    There were also a number of people who kept asking you “what is yours doing now?” repeatedly. So I figured they could instead (if they cared) go off and learn that type of trading on their own with those example charts.

    As for SAR I haven’t used it much. The large distance between and entry and a stop turns me off cause I can’t use much if any leverage.

    As for % winning trades this issue comes up often. DG has raised it too. And others.

    It’s funny because % winning or losing means nothing without one other basic number…how MUCH does a win or loss generate.

    A system that wins 1% of the time but return 1000% is DEFINITELY something i’m interested in.

    So I can’t just ‘45%’ or even DG’s ‘90%’ or whatever without more info.

    But generally you have something that works and that you have put effort into. I salute you and wish you continued success with it.

  352. TZ(8155)

    ROB,

    >What will you do if last Friday’s low of 1705 is the final low for this DC? Will you chase on a DC confirmation?

    I’ll just have to look for a different entry. I suffered a long time last fall in this same situation, but surprisingly it turned out to be my best year ever. So patience can work as gary says.

  353. TZ(8155)

    I’ll restate clearer..

    Saying the % of trades that win from a system is NOT useful unless a person also specifies how MUCH each winning or losing trade makes.

    Only with those TWO numbers can you evaluate the expected return.

    Something that is right less than 50% of the time can have HUGE value.

  355. don

    after reading many analysts

    (1) We are in daily cycle decline for SPX. which should least for atleast for next 5 days. Then a new daily cycle should start which should peak by end of march to mark a IT cycle top.
    (2) dollar in new daily cycle and should peak in next 5-8 days. Followed by final daily cycle low leading to IT cycle low.
    (3) Gold…we are in trading range…doesn’t matter what you laber it..A wave, B wave, New IT cycle etc..

  356. ALEX

    QUESTION:

    Does the fact that the last drop (IN GOLD) undercut the first drop automatically negate the chart I am going to post here.

    This Chart is strictly being drawn for this question…thanks for any response in advance. Question: Is this Impossible to “cycle guys”?

    http://www.screencast.com/t/RAZQih5ct

    I ask because This has been an extremely strong move. I wonder (have seen it in smaller cases) Will some ever look back and say “The Fed stretched & changed things and we missed the A and the C??”

    I’m just trying to see possibilities and plausibility…and stay alert to both. I have been invested since end of Dec and the % gains have been large. Thanks.

    I have a few charts to post tomorrow .

  357. smt_troll

    Upon further reflection, I am going to add a few more thoughts.

    “First off you only mention two cases where you managed to win.”

    There was one in particular I didn’t mention, because of what many of your subscribers have been though, but if you insist. I was chomping at the bit to short silver last year. It was in a runaway move, and it was obvious that margin hikes were coming (in the last week of April the maintenance margin was under $10K – just over four percent – on a contract worth $225K).

    However, since it was still going up, I had kept a small long position (two contracts) going into May 2nd. When I saw 42.80, I concluded that the top was in, and put on a short position in size between 44 and 46. I covered them between one and two weeks later, making over eight dollars a contract. While I did make some money on the way up, I made a LOT more on the way down. That was one of my five best trades last year.

    You will probably say I was lucky, but I was waiting for what actually happened for a while, and managed to recognize it when it occurred. For shorter term trades, move to the downside are usually quicker than moves to the upside, which often tells you more quickly whether you are right or wrong.

    “If you did better than the model portfolio…”

    What model portfolio? I don’t know of any benchmarks for the short side. 🙂

    “…it’s only because you leveraged massively and got lucky.”

    I just posted a simple trade (shorting natural gas futures) that returned 1650+% percent in just over three and a half years with NO LEVERAGE. Off the top of my head, I can’t think of ANY asset that has returned more than that from the long side over the same time period. And this is just from following your advice (I have actually learned some things from you 🙂 ) about finding a bear (ok, you said bull) market and sticking with it.

    “I’ll let others dream about easy gains selling short.”

    I absolutely am not claiming that short selling is an easy road to riches. My response on this topic came from a claim that it was IMPOSSIBLE to make significant money on the short side. I am stating that with the proper knowledge, tools, experience, and discipline, that it can be done. Heck, options (which I don’t use) tend to (over the long run) transfer money from buyers to sellers. I hope you are not saying that all of the gains that option sellers have made over the years aren’t real. 🙂

  359. William Wallace

    Alex,

    Your chart suggests gold will bypass an A-wave. Maybe if gold enters the bubble phase. Look at the “extremely strong move” in reaction to the 03′ D-wave, still followed by a B-wave. Like D-waves are profit taking events following powerful moves (C-waves), A-waves are violent reactions to oversold conditions (D-waves), B-waves are smaller profit taking events in reaction to smaller powerful moves (A-waves).

  361. William Wallace

    I would like to point out also…swing lows went right out the window during the 03′ A-wave top, there was multiple swing lows as gold continued to gring lower and retraced over half the A-wave. So I wouldn’t suggest using a swing low as a guarantee for a new DC to new highs.

  363. ALEX

    Blogger William Wallace said…

    Alex,

    Your chart suggests gold will bypass an A-wave.

    Why? I have an A wave drawn…so you must be saying it’s not valid. WHy?

    Thx

    Oh, and you mentioned the “B” word (Bubble) ; ]

    …I wouldnt bet my money on it at this point, but I do believe that since 2008 , since we had 3 years of C-Wave?? – we might be in a different stage of the Bull.

    3 stages of a bull will lead to the Mania , and I think 2008 onward looks STRONG (3 yrs of C-Wave?) like the 2nd stage. MAYBE we are entering Stage 3 (bubble).

    But like I said, I wouldnt bet on it yet.Thanks for the answer, but why am I avoiding an A-Wave? criteria missing?

  365. William Wallace

    Alex,

    I believe when gold enters the mania phase, the ABCD pattern will be behind us and it will look exactly like what you have charted or the last C-wave will just keep grinding higher looking like sky’s the limit.

  366. don

    but if dow/gold is going to equal to 1 then does it makes sense that bubble phase has already started?..isn’t it too early..

  368. ALEX

    Sorry I was gone so long.

    OK, The answer was “B wave cant be lower than D wave was”. I thought that too…

    But when I look at the 3 years that NASDAQ approached it’s BUBBLE PHASE…It looked like “SHAKE OUTS” were causing the 2nd low to undercut the first low . (Or wouldnt that be B-wave lower than D-wave?).

    I just dont want to marry an idea that could change by “Bubble -over enthusiasm-Fed injecting, Gold parabola , etc ” IF ITS POSSIBLE .

    Maybe this comparison doesnt fit ??
    Just running it by the trading team : ]

  369. ALEX

    Blogger William Wallace said…

    Alex,

    I believe when gold enters the mania phase, the ABCD pattern will be behind us and it will look exactly like what you have charted or the last C-wave will just keep grinding higher looking like sky’s the limit.

    February 12, 2012 9:43 PM

    I believe that too. We will need to recognize it , to stay on it ;]

    Thanks W-W

  371. ALEX

    Blogger ALEX said…

    Sorry I was gone so long.

    OK, The answer was “B wave cant be lower than D wave was”. I thought that too…

    But when I look at the 3 years that NASDAQ approached it’s BUBBLE PHASE…It looked like “SHAKE OUTS” were causing the 2nd low to undercut the first low . (Or wouldnt that be B-wave lower than D-wave?).

    I just dont want to marry an idea that could change by “Bubble -over enthusiasm-Fed injecting, Gold parabola , etc ” IF ITS POSSIBLE .

    Maybe this comparison doesnt fit ??
    Just running it by the trading team : ]

    I FORGOT THE CHART…SORRY LOL

    http://www.screencast.com/t/Jg1cwU7Jw7

  372. William Wallace

    Alex said:

    “I believe that too. We will need to recognize it , to stay on it ;]”

    We will recognize it. We have a killer team, not so sure everyone will be in though.

  373. ver

    Alex:

    Welcome back, great to see you here more often again.

    How do you square being in a C wave with the action in miners? GDXJ is certainly demonstrating strength but the HUI looks rotten. I’d expect it to have at least kept pace 1:1 with gold’s % gains (let alone 2:1) if we’re in a C-wave with only higher highs and higher lows ahead.

  374. ALEX

    VER

    Thats a good point. I have been in select Miners (JUNIORS) so I hadnt looked at GDX really.

    I was in some Miners that doubled and some gained upward of 50% in a month.
    XRA, UXG (now MUX) etc.

    Let me come back in 5 minutes with a better look, thx

  375. ALEX

    VER

    HUI was off to a gradual start in 2008 too…but in a yr went from $150 to $450-
    (notice first 2 months shaded)

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

    while some JUNIORS then like EGO went $2 to $5
    , IAG $2 to $4+ in the first 2 months.

    I’m not really saying we are there at the start of a C-Wave, but I thought GARY was thinking that 2 weeks ago, and now that maybe the B-Wave undercut the D- wave…Its a “Shake out” in technical analysis and often shakes out positions.

    So I just wanted to know how that’ll hold up in later stages of the Bull.

    then I posted the Nasdaq , and it looked like it had those “shake out” periods 3 yrs prior to THE BUBBLE.

    http://www.screencast.com/t/Jg1cwU7Jw7

    why not the Gold Bull 3 yrs before a blow off?

    just my usual observations ;]

  378. ver

    Thanks Alex.

    I go back and forth about how much to read into the HUI vs. ignore it altogether since it seems to truly march to its own drum (more like a bunch of hedge fund algos).

    I have no doubt that when it finally begins its 2-4x momentum move it’ll look no different than it does now, causing everyone who tries to be clever by half to chase. But the idea that it has any practical usefulness as an indicator of what’s to come in the sector may be nothing more than wishful thinking.

    And as for GDX as an investment vehicle, I am starting to think that for those who really do want exposure to miners that it is well worth doing the homework to put together their own basket of a select group of miners. Virtually none of the traders and investors on this blog who I have seen be successful with realizing gains on miner plays use GDX or GDXJ but rather assemble their own list based on their own homework and fills on their well-defined “value” price levels.

  379. ver

    As for the pre-bubble-move-shakeout, I don’t think the Dec. low was scary enough. It retraced a small fraction of the entire C-wave move. If we are truly at a Nasdaq-like, pre-bubble juncture then it would more likely mean that we’re going to see this D-wave continue here and now. A drop from here to 1300-1400 would truly terrorize gold bulls and send everyone to the sidelines before going vertical.

  394. mikezza

    gary,
    you are now expecting this dcl in the dollar to mark the icl too. in the past you always used the standard cycle counts as the default until proven otherwise. what do you see now that makes you think that this is a shortened dollar icl rather than expecting another daily cycle.

  395. TZ(8155)

    >As for the pre-bubble-move-shakeout, I don’t think the Dec. low was scary enough. It retraced a small fraction of the entire C-wave move. If we are truly at a Nasdaq-like, pre-bubble juncture then it would more likely mean that we’re going to see this D-wave continue here and now. A drop from here to 1300-1400 would truly terrorize gold bulls and send everyone to the sidelines before going vertical.

    Before the NDX ‘launch’ into its higher-sloped final phase, it made a drop of a few weeks and then one more drop slightly lower. Then it was up and away into the final 1.5years of the bull. Potentially the exact same chart pattern we already have in gold.

    imageshack.us/photo/my-images/15/ndxlaunch.gif/

    I really want to warn people again about expecting lower action. It could happen, but I think there is a good bet to make in case you are wrong.

  397. Piazzi

    Vow! man, that is so generous and so cool of you doing all that

    Those who think one does a newsletter for 20-30 dollars to get rich are deluded and small-minded. Their brain are smaller than the size of their capital that they try to gamble in the market

    Keep up the good work inside and outside the market

  398. ALEX

    “Those who think one does a newsletter for 20-30 dollars to get rich are deluded and small-minded. “

    I dont know about ‘small minded?’ I think the reason you see more and more people all of a sudden joining the party is because it is GREAT MONEY …IF you can provide the service. After all , 3000 subs…do the math

    3000x $25/month = $75,000.00 per month.

    Thats $75000 x 12 months= $900,000.00/yr

  399. ALEX

    I personally just wouldnt knock anyone who is providing a service that people need-
    and are willing to pay for that service-
    and BONUS, they pay $25 / month and get back a way to invest and make 100x their original investment.

  400. don

    100% Agree with you Alex!

    I am not saying gary is bad person or his service is bad…my whole point is its a B-2-C model!! and now many people are realizing the alternate revenue stream which could be significant…I work full time and it is not easy to get paid so handsomely in real life jobs even if you are at VP level!!

    What i read about gary/doc so far is they sounds to be a good at heart and has good brain towards market. But i seriously doubt about your brain size Piazzi or even does it exists?

  402. TZ(8155)

    Ross clark a few days ago outlined a similar comment to what I just made and compared it against 1979:

    talkdigitalnetwork[PUT.DOT.HERE]com/2012/02/gold-whats-next/

    Download the MP3 and listen to it while you view the PDF file available on the same page.

  403. Haggerty

    Look I’m not sure what’s going on man, but I can tell as a member for close to a couple of years that it is well worth the money. Even if you have a small amount of money like me. Gary is in this to help people, he is doing it with his personal friends and for his members across the country.

  405. William Wallace

    As I mentioned on friday, sunday night we would see a test of the $1730-35 area before reversing, and that if gold were to begin selling off at the European open we would most likely see a new low today, lets see if we get that new low.

  406. TZ(8155)

    I really recommend viewing that Ross clark info i just posted:

    “…The optimum high would occur in October over $3,000 using this scenario. …”

  409. sophia

    William,

    I followed your lead this morning on 2 contracts…Will close soon as kids on vacation and I won’t be able to follow…Merci merci mon ami!!

  410. Haggerty

    TZ

    Just listened to that link, pretty similar to Gary’s outlook like you said. Just need to show patience here. the opportunities will come.

Comments are closed.