35 thoughts on “CHART OF THE DAY

  1. bhowe

    Your very sure, wow 99%? All I see is a possible AB=CD pattern with a high around 54. actually now looks like a great spot to enter. What makes you so sure about the bear market ending?

    1. gary Post author

      Confirmation that the CRB has completed it’s 3 year cycle low. If the CRB has bottomed then gold has bottomed also.

  2. Mr. Edge

    I believe your analysis is correct. However, I also believe the official will be official if gold doesn’t get blasted in the wee hours of Monday morning.

  3. David Silver

    Mr. Savage,

    You are sounding like a hypocrite about trying to time entry points now don’t you think? That’s what I’ve taken from you about your swing low timing in Gold.

    I think only William and I were the only ones into Crude until Tuesday.

    At any rate appreciate your thoughts and confirmation.

    1. gary Post author

      I would agree. Folks get very married to the trend and can’t envision any scenario in which it could reverse. Like I said 90% will always be on the wrong side of the trend at major turns. And I should probably add that 90% will stay on the wrong side of the trend for many months before reality sets in.

  4. zkotpen

    FOMC minutes are always good for 1-3 reversals in gold/miners.

    Looks like we may have the first here in gold @1153 —

  5. AlexP

    I think skepticism is warranted until we see how USDX moves upwards towards its new YCH after putting its YCL due next week.

    1. gary Post author

      I’m going to point out that the dollar is only 6 weeks into an intermediate cycle. Any YCL is still months away.

      1. AlexP

        Exactly, USDX is rolling over and it will continue well into next week.

        Gary, I’m sorry but I must contradict you: there was no ICL in USDX on Aug24, so that we are now into week 21 of this IC.
        It wasn’t because of various reasons:
        – the IC down trendline was not broken,
        – USDX did not penetrate its 50dma but quite on the contrary – USDX bears fought a tremendous battle for about two weeks with bulls and have eventually won
        – the Keltner cycle band of USDX was not broken either.

        Thus, since we are in week 21 of this IC, the dollar is now getting ready to roll over into its ICL which will also be YCL. We are also late in the YC too –> we are in month 17 !!!

        1. MuffinTop

          No you don’t understand.. I’m disagreeing with you.

          You said: “.. until we see how USDX moves upwards towards its new YCH”

          And I’m saying: The Dollar is rolling over and headed to new lows Compadre, meaning it ain’t moving upwards cuz people are losing faith in the dollar 🙂

          1. AlexP

            :):) you’ve missed my part which follows, quote myself: “[…] after putting its YCL due next week.” 😉
            So, what I basically implied was the following stretch of events:
            1) YCL in USDX next week
            2) USDX starts its new YC and in november will put a monthly swing low as it moves into its new YCH.
            3) CRB, gold and oil will be put under major pressure as USDX will move higher from mid October into January, so that they will make new lows AND THERE WE WILL SEE THE MULTI-YEAR LOWS IN COMMODITIES.

            So first the YCL of the current YC and then the YCH of the next YC.

        2. gary Post author

          We did get a right transalated daily cycle and a weekly swing and a break of the intermediate trend line. All the confirmations needed to call an ICL in Aug.

    1. gary Post author

      Gold is trying to break through the triangle trend line and miners need a break after 3 big up days to let the 10 day moving average catch up to price.

      This is how the wall of worry is built.

  6. AlexP

    oh, yes, we will see.
    this is an unhealthy rise:
    – medium volume instead of high on up days,
    – SPX is on a bearish divergence with its Money Flow Index
    – defensive stocks (Consumer staples via et XLP) are leaders
    – discretionary goods stocks are growing with the market but are not leaders
    – offensive stocks complexes such as $RUT, Transports, biotech are now on bearish divergence with all major indexes.

    A new, fresh bull within a new multi-year cycle cannot beat the bear with its weapons – defensive stocks. It must lead its legions of offensive stocks, sharply, on high volume and with no bearish but, if any, bullish divergences of major indexes with their indicators.

  7. AlexP

    …and so much with this bear market rally. As soon as VIX has just come close to kiss its 100dma from the upside (not too far away from 200dma too) and as all major indexes touched their 50dma, heavy profit taking has emerged.

    1. gary Post author

      Ooops spoke too soon…

      Back up she goes.

      I’ll say again: Don’t make the mistake of thinking we are playing on a level field. This isn’t, and hasn’t been a free market in years. Just because the economy is rolling over into recession doesn’t mean stocks will go down. It just means CB’s will print even more money to prop them up and prevent the recession.

      It worked wonderfully in 2011. They will use the same game plan again.

      1. AlexP

        Gary, besides my arguments above, please mind that there is also MASSIVE selling on strength in stocks at 50dma as I write this!
        I am so confident that this is a genuine bear market rally set to end that I’ve just put in a short for 1.0% capital-at-risk of my equity besides the long UGL I had for 10% of portfolio; the rest is cash.

        PS: reverting to USD, the weekly IC trendline of USDX has not been broken; the weekly swing low is to be proven false

        1. Mr Edge

          Another thing to keep in mind is that B.O will never let the market tank in an election year. Ever.

  8. Dan

    F*ck the Fed. Deflationary crash soon. Loaded even more March SPY puts today to up the bet to 5% of my account. Don’t really care about looking stupid. This bet won’t wipe me out. Bring it on.

    1. gary Post author

      I would strongly suggest you not listen to the deflationists. The only way to get a sustained deflation is in a fixed currency system like we had in the 30’s. In the modern era where central banks can print at will the risk is never going to be deflationary. It will be 180 degrees in the opposite direction from the 30’s. The risk is inflationary.

      Bernanke proved that beyond a shadow of a doubt when he stopped deflation in its tracks with QE1.

      1. Dan

        That’s the myth anyway, that central planners will be able to control the free market. Bullsh*t I say. Deutsche Bank tanking after hours with horrendous earnings. There’s one derivatives time bomb that could really kick things off to the downside.

        My favorite macro maven (not Dent) says we get a deflationary bust first ($5 silver, 500 SPX, $10 oil), then when central banks panic and openly buy everything, then you’ll get your hyperinflation and $5000+ gold towards 2020. I doubted his call on $40 oil last year and will not again.

        1. gary Post author

          No way CB’s make the same mistake again and let the markets get away from them. They will be proactive this time and start printing long before we get deep into another deflation.

  9. William

    Trying to pin down on miner majors that have already breakout from their vertical resistance line since the peak in Year 2011 would be a worthwhile exercise to do now as this could serve as the eventual confirmation for an ultimate breakout in HUI or GDX’s vertical resistance line since year 2011….

    I have spotted one yesterday in the big Aussie miner New Crest Mining. Another interesting point to note on this stock is that it has been one of the “leaders” in precious metals sector as it has never hit new low or tested Aug’s low during September’s rout!

    I know a lot of small miners have exibited similar pattern lately but i think it needs the majority of big miners to pull the trigger here….

    In any case, the verdict for a collective breakout seems inevitable for now!!!


Comments are closed.