Mar. 14 morning report

Well gold didn’t hesitate at all to break through the resistance. I have to think we probably have a clear shot at $1425 at this point with minimal retracements. 

More importantly silver has finally joined the party and broken out of its bull flag. It’s got a lot of catching up to do. I expect the biggest move over the next week is going to come from silver. 



Hold positions. This is a monster trend now with no upside resistance for another 40 or more points. 

Gary

76 thoughts on “Mar. 14 morning report”

    1. Gary

      I have no idea how to predict when the Fed is going to step in. Based on the Bollinger band crash signal today would be a good day. I have to think they want to stop this ahead of the FOMC meeting next week if they want cover to taper again.

  3. FiatFlatline

    Gary –
    I noticed this admonition in the paragraph on the far right of your blog page:

    “Gary Savage, will not provide you with personally tailored advice concerning the nature, potential, value or suitability of any particular security, portfolio or securities, transaction, investment strategy or other matter.”

    A good point for the loyal followers to keep in mind. We are ultimately responsible for our own trades, and no one has a magic crystal ball.

    1. FiatFlatline

      You are welcome, eliyahu.
      Seriously, though, you obviously understand this, but if you have followed the comments on Gary’s main site over the past three months, there is ample evidence that a number of subs are trading shorter-term and with options (but have not joined the AP service) and then come off pretty critical of Gary’s long-term projections, when they sustain some losses.

    2. eliyahu

      those guyz will learn, like everybody does
      gary to me is very uniqe and I have been trading the markets since the tech bubble

    3. Gianpiero P.

      FiatFlatline, probably you want to see more than it is really there. A least if you are referring on my previous question to Gerry, you are definetly

  5. BOBBO

    As I mentioned the other day gold’s rise is partially due to Ukraine, to what extent I’m not sure. Even though the gold stocks broke out of their consolidation, yesterday, it wasn’t a big move, and today’s move is modest. If gold’s rise wasn’t geo-political the gold stocks would be making a much larger move. Gold will take a hit when the situation is resolved, and will continue to move up if the situation escalates. Geo political events always muddy the waters in terms of the price of gold and its hard to figure out how much of this move is real.

    1. Gary

      Gold is moving because the dollar is collapsing. With all the political stuff happening the dollar should be soaring. Instead it’s tanking. The Ukraine is just icing on the cake, but the real driver is the dollar.

    2. Greenspansconscience

      Strongly disagree. This is a pure currency situation. You have yen and $USD both moving in the right direction for the metals. If it was geopolitical, you would be seeing a so-called flight to safety and a rise in $USD, imo.

    3. FiatFlatline

      Good point, Bobbo. The obvious value of precious metals is a truth that has not yet reached the masses in the US. China and Russia know their value. If Ukraine is resolved and gold drops, most forget that the world is not any more stable or fiscally sound. Over the second half of 2014 and into 2015, as the US dollar is increasingly rejected and traded around, gold and silver will shine at much higher, consistent valuation … imho.

  6. BOBBO

    The weakness in the dollar is very interesting. Usually the dollar is a flight to safety. In this case its been bonds and gold.

  9. eliyahu

    Greenspansconscience
    did you check by any chance nugt to gdx ratios? I think the higher we go the ration will grow (nugt:gdx)

    1. Greenspansconscience

      No haven’t checked, but you can easily calculate using 3rd grade math. 🙂
      Yes the ratio should go up. The 3x mining etfs have 2 things working in their favor, the rising mining to gold ratio and their rising ratio vs gdx and gdxj.

  12. BOBBO

    Gary, IMHO, Gold would be moving up even if the dollar were also moving up because of Ukraine. If Gold was moving up mostly because of $ weakness, the other metals, especially silver would be stronger, and gold stocks would be making a larger move higher.

    1. Greenspansconscience

      Silver is setting up for an explosive move. The weekly Bollinger bands are extremely narrow in historical context. Sure, the move might be up or down as the Bollinger tightness doesn’t tell you about direction. But make no mistake, silver will be moving soon.

  14. Gary

    Here comes the Fed market save before the market closes for the weekend. It might have a temporary depressing effect on gold but it’s not going to stop the dollar collapse so gold should recover and continue higher next week.

    1. dutchisu

      Gary
      This selling seems awful heavy to just be a “temporary depressing effect” stemming from the recovery or the stock market.

    3. Gary

      I don’t think gold’s intermediate cycle is going to top until the dollar bottoms and that might not be until the GDP report or the Apr. employment.

    1. Gary

      Not selling until I think the dollar has bottomed. This is just another manipulation event. We seen many of them during the last two months. They’ve all failed. I think this one will too as I don’t think the dollar has bottomed yet.

  18. Bail "OUT" 2 Bail "IN"

    Heavy manipulation from 11:30 ’til noon…roughly 32k contracts above avg. volume for this time of day on a Friday…and happening just after London shuts her down with the last Gold fix…

    32k Contracts controlling 3.2 million troy ounces of gold at an average price per ounce of $1,378.5 comes to a position of roughtly $4.4 billion…who has $4.4 billion to throw at the paper gold market in a 30 minute time span…yep, you guessed it…Janet must be “Yellen” at ’em now…LoL… 🙂

  19. dutchisu

    Gary

    Can you remind me again why you are so confident that the dollar has further downside. The current setup in the dollar looks almost identical to the bottom in January 2013. (See attached link) I know you have talked about this IC being extremely left translated but other than that this cycle has not exhibited traits of a super weak cycle. On week 13 the dollar came with in 0.27 pts (0.3%) of making a cycle high. It seems crazy to me to think if the dollar had just moved up a hair more during the 13th week you would revise your whole outlook on the dollar. Not trying to be critical just trying to understand as I think how things shape up in this 3rd daily cycle for gold and silver is 100% dependent on what the dollar does over the next week or two.

    http://stockcharts.com/h-sc/ui?s=$USD&p=W&yr=3&mn=0&dy=0&id=p20138000538&a=341673347

    1. Gary

      Yesterday was day 16. The previous cycle bottomed on day 17. This should be a long cycle, not another short one. ICL’s occur with everyone freaking out and sentiment at extreme’s, not looking for short cycles and double bottoms.

      So I have to think this left translated cycle will play out like most of them do with a move to lower lows and an extreme sentiment reading.

    2. dutchisu

      Gary
      I hear what you are saying. But the counter point to the extreme sentiment reading you are looking for is presented in the dollar sentiment chart you posted last night. We are currently at a lower sentiment level than was seen at the January 2013 intermediate cycle bottom.

      I just think there is the possibility that this ICL is not going to be as scary as you think since the 3 YCL is right translated and the 3 YCL bottom isn’t due until October or November.

      In the end I hope you are right about there being more downside in the dollar as I have not sold my longs yet.

  20. BOBBO

    Here we go with the manipulation again. Gold dropped after 11:30 because of the a statement from the Russian foreign minister that said Russia had no plans to invade Eastern Ukraine. While I do believe at times Gold is manipulated, not every move down is a manipulation.

  21. Bail "OUT" 2 Bail "IN"

    You’re entitled to your opinion as I am to mine…

    If a person applies logic to what happened at 11:30am this morning, there’s only once plausible explanation…no one dumps “in size” that kind of volume at this time of day on a Friday in an up trending market…

  22. David Akridge

    Bail “Out,” did you see any.obvious M in the premarket? The Boyz play the long side too.

    Gary, we have 2 to 12 more days in the Dollar cycle. Will this be the 3 YCL and do you think it will get down near the 77 level? At that swing, we go in heavy in the metals and miners? Will you be considering silver and their miners?

    Gary, any idea on timing of getting the SMT blog back on line? Thanks.

    1. humbe

      I think he’s both. I respect the analysis that he does, solid technical and qualitative insights though over the top at times.

    2. eliyahu

      but why does he have so many words to describe one thing? and they way he talks about the stock markets, as if it is a “bad” thing. I expect an anlyst to say what he thinks would be profitable. But when he does analyze he does state some uniqe analysis

    2. Troy

      Except links aren’t ‘clickable’. However, not sure if I like replies threaded or not as replies can get missed. (maybe a good thing!)

  25. Troy

    For those daytrading (not me) the miners are back in the green today. We can all stop worrying until the ICT gets puts in.

    apt10o

  27. Bail "OUT" 2 Bail "IN"

    Bobbo…here’s a little more data for you to chew on…

    I went back and reviewed the volume and price movements for every Friday this year between 11:00am and 1:00pm here’s the results…

    ………..Volume in 000’s….Price Move
    01/03… ……..101…………….↑$3
    01/10… ………98……………..↑$3
    01/17… ……..119…………….↑$6
    01/24… ……..143…………….↓$7
    01/31… ……..104…………….↓$5
    02/07… ………94……………..↓$3
    02/14… ………84……………..↑$4
    02/21… ……..104…………….↓$4
    02/28… ……..106…………….↓$5
    03/07… ……..132…………….↑$6
    03/14… ……..169……………↓$12

    Surely…nothing intentional happened today…

  28. Gary

    A decent size BoW number is again showing for GDX. I don’t think this IC is going to top until gold makes a higher intermediate high and confirms a new bull market has begun.

  32. FiatFlatline

    Gary –

    Assuming things don’t change in the coming hour with the markets, what argument can you make that the parabola has not been broken, or is not starting to break?

    Thanks

    1. FiatFlatline

      Being greedy, I wagered some call spreads . . . that’s my monetary interest. Plus, the chance to make some coin on the parabola continuing into late May. Oh well.

      Will you be able to project the markets’ fates with much greater confidence by next Thursday, after the FOMC?

  37. Gary

    Armstrong has no idea what he’s talking about. All markets run in valuation cycles. When stocks are undervalued then inflation moves into stocks, as in the 20’s. When stocks are overvalued then inflation moves into commodities, as in the 70’s.

    He’s been calling for $900 gold. I said he was going to miss this move and he did. Now he’s jumping on the band wagon as we move into the final daily cycle before the next ICL.

  38. FiatFlatline

    Gary –

    You answered me (thank you), saying that the stock parabola may have been broken. Will you be able to project the markets’ fates with much greater confidence by next Thursday, after the FOMC?

  40. Greenspansconscience

    Relatively ugly action for the miners, more so gdxj, all things considered. Gdxj has not been able to regain its mojo over gdx for over 5 weeks. Today, seemed like the day it would pull away, but no dice.

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