36 thoughts on “CHART OF THE DAY

  1. gary Post author

    So far so good. The SMT metals portfolio is up 20% for the year and waiting mostly in cash for the next DCL. Considering that miners are down 24% for the year we are outperforming the index by over 40%.

    I’m happy with that considering this has been and continues to be a very difficult market to trade.

    1. Jorgy

      Sitting in cash until we get clarity on EQE2 Thursday at 7:45 am (EST) and FOMC liftoff (or not) on Oct 28th is key. No need to jump the gun and go long gold, silver and the miners when they could be rolling over to make potential new bear market lows.

      The Trillion $ Question is whether the FED is supportive of a weaker EURO/YEN or whether they’ve re-entered the global currency war(s)? We shouldn’t have to wait long to let the currency markets, oil, gold and the miner complex to tell us the answer. Frankly, I’m more interested in shorting the broad index’ around their 200 SMAs, getting long volatility or staying in cash until we get our signal.

      Bottom Line: The entire commodity complex was short-term overbought, sentiment had improved from the mid-summer lows and they deserve a nice rest given the outsized move. Should they swing above the recent lows in the timing band for a DCL and a half IC low then we’ll re-load long if/when the time comes. Until then… ?

  2. Bill in Tokyo

    Way to go!

    Loved the comment in the chart above, “You will know the correction is complete when it has dropped far enough that all thoughts of buying the dip are gone, and you are too scared to pull the trigger.” ha ha ha! You should write a book! Love it.

    But man, today’s GDX daily candle went down to a small shelf support, so I still think it’s possible we get 1 more push up. This is just killing me.

  3. Jay

    Doesn’t “Too scared to buy the dip” imply that we need to see a new 52 week low….or at least get extremely near the 52 week low?

    Up 20% for the year is great (if it’s true), but that doesn’t mean most folks here (including premium members) are anywhere near back-to-even relative to where they were when the metals bear market began.

    1. gary Post author

      I doubt that everyone has held all the way through the bear market.

      And those returns are documented in real time.

  4. David Silver

    Fantastic call for both Mr. Savage and William, way to go!

    I’m in the bullish camp to hold here in energy and metals/miners because I think the bottom is in therefore don’t really like to day trade unless there is no trend just directional momentum plays in which they are not at this juncture in time. The same can be said for me about the US Indices and the Shanghai IMO. Unless an ETF is involved but at this time I own a few mining and US internet tech companies too and in hindsight should’ve unloaded the metals/mining at the open as Mr. Savage recommended but have a longer game plan for them.

    William was spot on unloading last Thursday, good job my friend!

    1. William

      Welcomed David. Thanks goes to Gary for hosting this public forum for non-subscriber. It is a good place for bouncing off my 2cents’ view while considering others’ thought.

      Really likes the “check and balance” here…

  5. William

    May see gold price dripping down and test 1,158-ish level, i.e Fibonacci @ 38.2% from Oct’s trough to peak on 60mins’ chart, to work off the overbought level on daily chart…

    If this pans out, miners’ positions will not be compromised as this happens during Asian trading hours…it would be a positive correction to prepare for a reversal tonight!

    1. David Silver

      I agree William Mr. Savage IMO is the best market timer ever and the best value second to none.

      I hope your forecast for tonight is dead on and wished I should’ve listened to both of you but oh well trying a different approach nowadays of being more patient I guess.

      1. William

        Ya man, being trader is already tough let alone operating in our respective & crazy time zone…and still have to operate with a proper mind!

          1. William

            CRB? Looking at CRY, it’s pretty much done with correction. Also, on New Crest mining, today’s gap down is testing its 2011’s downtrend breakout happened two weeks ago…i think New Crest is pretty much done with this short-term correction…

            I like to look at New Crest as i consider it as one of the leading indicators for miners!

    1. AlexP

      agreed, William:
      – today & tomorrow pullbacks
      – Thursday upthrust (possible DCH in stocks) as institutions stop selling and let retailers buy the would-be dips
      – Friday most likely to set the DCH in stocks
      – on Monday tighten the belts
      – Wednesday = quiet day with a last rally immediately after FOMC –> tighten the belts further: THIS IS A ROLLER COASTEEEER ! and screams start all over

    2. David Silver

      William you may very well be the master behind the master with your correction call!

      Shanghai blasting higher my friend.

      Ever look into New Crest clone charts like my babies? EGO, GORO, AU and King ABX?

      1. AlexP

        Unlike Hong Kong, Shanghai has never been a leader. It’s a LAGGING indicator and it will be there as long as the Chinese economy does not grow based on household consumption and as Communist interventionism lasts.

        From that point of view, Shanghai growing is like seeing capital goods blasting higher at the end of a bull market 🙂
        Patience is warranted.

        1. William

          Same as Alex, I would be cautious on China here, I still think the H&S daily pattern is heavily weighing on the prices…won’t be outright bullish until this pattern is invalidated of which i don’t see any reason for it to happen now.

  6. William

    Well, been waiting for the Gold to drop further during Asian trading hours but it just ain’t happening at all…and i think it ain’t gonna happen during U.S trading hours either!!!

    So, rather, i guess we can expect the opposite to happen!

  7. David

    Gary I am a relatively new member and have found you are weeks ahead of every analyst out there. I don’t know if you believe in the Elliott Wave Principal but I see this recent correction of Gold and GDX as the 4th of 5th Impulse Wave. I see Gold going to at least 1197-1225 before it fails and GDX getting to 17.95-19.38 before it fails. Then the real bloodletting will begin in a huge correction which can take us down to 13.60-14.30 in GDX. Bottom line i think your original analysis of a short correction followed by upside and then a huge correction is more accurate. Again I am so impressed with your service.

  8. Hong Bang

    Hi David,

    Each technical have target & price’s scenarios. So I think we have to build our own method with stop in the case other scenario happens.

    Elliott wave is widerly used but for the same stock you can pain many prices objectives & scenarios.


    1. David

      Don’t know what you are trying to say but up half mil by following Elliot which says gold will hit min 1197 to1237 before rolling over. I was merely trying to give my two cents since we all have the same goal.., to make money.

  9. AlexP

    yes, William, USD is getting away from its declining DC trendline continuing into this DC instead of producing a new DC, just as Gary expected it.

    Therefore, now USD resuming its decline into the same DC, would render gold higher –> confirmation that there was a HCL in gold and not DCL is to come soon

  10. AlexP

    on my side: you’re welcome Hong!

    JOHAN, watch out with those USD longs you had!
    On the other hand, that hand may work out quite well throwing RIGHT AFTER, I mean several minutes after, FOMC decision is getting published.
    This decision will NOT be followed by a conference call so that all that markets will have to digest will be the FOMC statement.

    Buying USD [dumping gold] on the selling climax to come right after the statement will make an excellent contrarian move – again, just as Gary spotted before us (or at least me) that DCL in usd would come on fomc day.

  11. Hong Bang

    William, you are in Malaysia?

    I’m in Viet Nam. We may exchange trade’s ideas in South East Asia !!


    1. William

      Yup, based in a very hazy city now in K.L…Irony thing is that I don’t trade Asian markets due to my day job as a fund manager since i am technically not allowed to.

  12. AlexP

    there are some fantastic stock opportunities for scalping (on small capital-at-risk percentage) thanks to the 2-day pullback to come today and tomorrow and to the ongoing earnings period … tomorrow evening I’ll be buying on weakness with a holding period of 2 sessions at most

  13. gary Post author

    This is all about the dollar over the next two days. If it rolls over and has one more leg down before the DCL forms, and especially if that were to test the August low then I will guarantee the bear market in gold is over.

    If the dollar can hang on today and close back above the 10 day moving average then it’s still up in the air.

    Everything depends on whether or not the dollar confirms that it’s intermediate cycle has rolled over.

    Today and tomorrow are key. If the dollar closes strongly below the 10 DMA today, and more importantly if it follows through to the downside tomorrow then it’s all over for the buck and the gold bear is over.

  14. JoshuaF

    This may be interesting, I don’t know. A few days ago I decided to sell all my NUGT and simultaneously buy GDX using 3 x the capital held in NUGT. The idea being that it is better to be in GDX than NUGT. Today early I shorted NUGT having read Gary’s post about everyone freaking out. The proportion is 5:1. Thus if you held 500 GDX (that is not what I hold!) you short 100 NUGT when the indicators are sowing overbought as they are now. At the end of the day both were in the green for the day! I could not believe it!
    I will wait to “freak out” time to cover my NUGT shorts and then short DUST. I have a feeling that if you were short equal quantities of both NUGT and DUST all the time you would be in front!

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