70 thoughts on “CHART OF THE DAY

  1. Gary Post author

    Typically when I start to see people shorting gold very late in a cycle and into extreme oversold conditions, along with predictions for completely irrational targets, that usually means gold is at or very near a major intermediate or yearly cycle low. On yesterdays breakdown I started seeing all kinds of predictions for $800 and even $600 gold. I also saw traders initiating short positions with gold’s TSI at -90 and silver at -96. That is a sign of irrational pessimism and indicative of an impending bottom.

    The same thing happend in oil yesterday and oil is up 2% as I type.

    1. MuffinTop

      Muffin Wisdom 101 — Understanding People Pyschology is the most important lesson in Trading and will ultimately take your game to the next level.

      Just like in Poker.. You don’t play the cards, you play the person sitting across from you ?

  2. Davidh

    Any idea on what you think the bottom will be for GDX and also the potential top if it bounces?

  3. angus

    ibelieve gold has one more 5 monthly cycle to run after december which could finish the bullish wedge pattern which could make june/july20 16 a better long term entry.

  4. Simo83

    Until now every call for a market bottom has been wrong and during last decline we have not experience a minimum bounce at all.
    Maybe it is too late to enter short on this last move but there is no sign of significative and tradable low.
    GDX is behaving very bad, the improvements in the balance sheets of the miners result in a 3-4% relative strenght compared to gold, but nothing more than this.
    Paper shorts are driving the market despite everything, nothing else matters. I’d like to ask to corrupt “finanacial journalists” if dollars pay interest.

    1. AlexP

      yes, gold should continue this IC lower after the new DCH is hit and while USX will resume its upward trend into a new daily cycle

    1. Gary Post author

      Yes but gold is now in the timing band for an intermediate cycle low. I’m watching for signs of a bloodbath phase. If gold just continues to crash for another 5-7 days then this is the bottom of the ICL. If it bounces first then the 5-7 day crash will probably come in December after a bounce.

    1. Gary Post author

      True but I would like to catch the bottom because one could make 50-100% on the rally that finally makes a higher high. I would prefer not to miss that. No other rally of the next bull market will make as much, as quickly as the iniitial move off the bottom. So I will continue to try to catch these bottoms even if they don’t turn out to be the final low, because one of them eventually will.

  5. chris

    TFOMO! Lol. Good one. Anyway bloody silver has been dropping like 14 days in a row. Entering Guinness world records. Anyway it’s amazing since dare to initiate short given how oversold PM are now. Now is the time to tighten take profit level if you have shorted at higher levels.

  6. Mark

    I appreciate A LOT this blog , the passion and the experience Mr.Gary Savage put on it is great!
    I must say it’s one of the reason why I still fight in my trench rather than give up and sell all of my PM shares!!!
    Yesterday I came across to an interesting opinion from Mr. Larry Edelson who seems similar to Mr. Savage’s:
    Larry Edelson yesterday came out and said the following:
    “Over the past several months I also told you that while this crisis would ultimately cause gold, silver and other key commodities to soar, it was too early to begin investing in these areas. The bear market that has plagued commodities since 2011 showed no signs of ending. In fact I expected that the bottom would not come for many more months — until well into 2016. I was wrong: The four-year bear market in gold, silver, oil and other commodities is beginning to end NOW!”

    1. Bud fox

      Until there are people still calling for “The bottom”, the bottom IS not In. We need complete and utter capitulation. When Gary says gold is going to $600-$800 might be a good time.

      The opportunity costs associated with this 4 year bear market for some have been unmeasurable.

      It’s best to move on and wait for at least a WEEKLY higher high, unless one wants to continue to get sliced and diced by this unrelenting bear market.

  7. zkotpen

    Hi Alex,

    “yes, indeed. FOMC minutes later today will be the catalyst for USX’ decline and gold’s burst”
    “yes, gold should continue this IC lower after the new DCH is hit and while USX will resume its upward trend into a new daily cycle”

    — We are pretty much on the same page here…

    How high are you looking for gold to bust out to?

    I am thinking something like 1100 or maybe 1117 area, 24 or 38% fibonacci retracement, respectively.

    1. AlexP

      Hello, hello, Z!
      I have no idea how much gold may retrace … sorry, Z! 🙁
      such a strong USD bull obliterates any forecast at least definitely from me.
      Anyway, I think USX will retrace by a small percentage so that gold will not have much space for recovery, neither in time nor by measure.

  8. Herman

    I am afraid 600 gold is not unrealistic, especially not when USD strength will reach extreme levels (somewhere next year?) when the stock market starts to crash and the whole world will flee to presumed safety of USD.

  9. Herman

    Still a lot of bulls in the market and we have not seen a real shake-out in the miners yet (comical bid period).

  10. David Silver

    Stock Talk:
    Shorting miners yesterday was a strategic technical event: http://stockcharts.com/freecharts/gallery.html?s=DUST
    Gold to 1025.25 min to 956.20 max
    Crude forming a bearish intraday wedge as I type:http://m.investing.com/commodities/crude-oil-streaming-chart
    Crude to 37.75 min to 32.99 max
    US Stocks need to break abover her 200 dma:http://stockcharts.com/freecharts/gallery.html?s=Spx
    If she does I’m back in FB however still continue to own ANGI as a hedge in the meantime.
    Short miners and crude.
    Long ANGI

  11. Herman

    I think that the bear market will only end when the bulls have lost all hope. Low activity on gold related blogs etc., because just being sick of it. I thought mr. Savage’s earlier call (‘surviving the last months of the bear market’ or something) was rather credible ( ‘avoid losing your capital and sanity’) and will be proven correct, though at much lower bottom price and later in time. I agree with this call and those of contrarianadvisor and the Plunger.

    1. Mark

      Wait a minute.
      I’m one of those idiots who did not sold in 2011,my loss is ALREADY 90% so I will NEVER sell my position even if Gold will go to $50!!!!!!!!
      I don’t understand when someone says “the gold bear will finish when all the bulls will capitulate” This is RIDICOLOUS.
      I have ALREADY capitulate!!!!
      But I will NEVER sell!!! Rather I will sell my house and go in some exotic cheap country rather than sell my shares to please some permafuckinbear!
      I did a giant mistake and I will die with it;of course I hope that in this extreme bearishness something positive will happen, but I’m VERY bearish on Gold but,I repeat, I will NEVER sell with a loss of 90% !
      Will this loss go to 99%? NO PROBLEM AT ALL!

      1. kaiwen

        Mark, agree!!!
        If this were not a capitulation, I really don’t know what it is…
        Most of gold sites today are full of short sellers… look “http://321gold.com/” for instances…
        For years, some of them were buy, buy, buy.. all the way down.. Look what they are doing …”dust, dust dust”! lol..

  12. Stefan

    We have YEARS left in this bear, but Gary does not want to listen. In between we got a few rallies.

    Short term I have no idea, mid term yes I think I have a couple of dates, long term I am going to nail it 🙂 bcos everything works in cycles, we will know when the time is right. I think the next bull will be trigged by an important financial event. We are not there yet, remember big complex structures crash in slow motion, complex structures like the dollar or the bond market, IT TAKES TIME, be patient !

    1. Gary Post author

      What cycles are you talking about, because gold is already in the early timing band for it’s 8 year cycle low. And the CRB is getting late in the timing band for it’s 3 YCL.

  13. Herman

    Gold price slides down so easily, then takes a little rest, and down further. I think a pop will be small and short lived, then down till FOMC December, and then maybe a larger ‘surprise’ rally if the FED does not hike. That would then be the last rally before the big drop, when the expected deflationary bust arrives (courtesy to CA).

  14. Don

    Gosh, it just seems like yesterday that this site was full of happy talk about gold and it’s miners being in a new bull market and that the dollar was supposedly topping out. Actually, it was only three weeks ago.
    I have been trying to understand this ‘cycle’ thing but it seems that they are mostly described as being “failed” or “stretched” and that it’s the FEDs fault that market cycles are no longer “natural”. If that is true, and it may very well be, why bother with charts, cycle studies and technical analysis?

    1. Lil' Ricky

      Don, you make a very good point…deciphering cycles often seems to be in the same boat as decoding tea leaves. But you have to admit it makes for an entertaining read.

  15. JT

    Hmmm….perhaps the PM market is wrapping its head around a one-and-done December hike, and getting cozy with the idea.

  16. William

    Fed. said = all in for a Dec. hike.
    But, the journey of this interest hike cycle will be slow and steady.
    So, rate hike = inflationary…
    But, a slow and steady increase in nominal interest rate = real interest rate can be negative for a long time still…
    so, conclusion = very inflationary for commodities. Period.

    1. MuffinTop

      No problem W! This one is part of my 5 year plan, but we should (regardless) keep a close eye on major monthly support @$2 just in case Gold decides to drop some more over the next month or so and drag GORO under. Note: My daily indicators are diverging nicely but the weekly is still catching up.

      My strategy at this stage: If GORO closes below $2 on a weekly chart then I’ll close half of my position and wait on the sidelines for a better opportunity. Clearly, I’m trying to pick a bottom on this one and that’s intentional by the way because I agree with Gary — we could make 50-100% on the rally that breaks out of the gate and finally makes a higher high, and that is always more likely with stocks that are trading below their intrinsic values.

      Good luck 🙂

    1. William

      No worry there…a bullish candle-stick will be bullish regardless of volume. And, RSI for GDX is about to get to 40 reading again, but i needs to stay at or above 40 to confirm that positive momentum is back…we shall see in another 35mins time!

        1. William

          Price (i.e candle-stick, trend-line, pattern) is always primary indicator…
          All others: volume, stochastics, etc are always secondary…

          1. JT

            I want to call a win a win, but watching the miners get all jiggy and seeing the metals (gold and silver) go virtually no where is a bit concerning.

  17. William

    Gold and silver can follow later…miners are leading (again) here, i think.
    We shall see how gold and silver move during the Asian trading hours…

    Until then…

    1. Bud fox

      GDX is guilty until proven innocent. This is nothing than a bear market bounce until proven otherwise by higher highs and higher lows.

  18. chris

    Go look at the chart that Gary posted previously. Looks like Inverted HS. Double bottom being the head, right shoulder is the Paris attack low. Now we need a close above 2120. Measured move shall be 2320. Good luck.

    Catalyst? GS just upgraded Apple , saying 50% upside. Said what service revenue.

  19. AlexP

    Z, please see my reply to you above.

    On STOCKS –> each additional day adds to the compelling evidence that this SPX daily cycle will be left translated and that now we are on a dead-cat bounce within an intermediary cycle decline to go as low as 1950 arround JAN08.
    Maximum SPX level of 2104 within the next days is even stronger after today!

  20. JohnWilkinson

    Oh no Gary, you did not take my advice I see to turn your back on gold, and to move on to other assets. Worse, here you are again like you have been doing the past several years, dangling the prospect that some big, important inflection point is near, that will re-start the bull market. It’s not coming. It’s not near. Gold is going to get much, much worse before any recovery (sustained) can take place. Even the USD would be a better bet the next few years. What does gold have on its side? Nothing.

    Folks, this is NOT 2005. Repeat: you are not living in the prior decade, when the macro stars aligned for gold.

  21. JT Marlin

    Next stage of the bull? The HUI has been decimated… there is no “next stage” nor “resumption” …it is more of a start from scratch.

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