59 thoughts on “CHART OF THE DAY”

  2. AlexP

    Gary, your anticipation was accurate but I think the reason behind gold’s move today is different: gold hasn’t moved today on its own; it has mirrored USX as usual:
    – had USX moved lower to break the lower wedge trendline, then gold would have continued its rally;
    – had USX tucked in range-bound as it had until mid European session today, then it would have stalled.
    But USX has moved up…

    PS: to be noted that USX has not broken the upper trendline of the wedge yet, so that both options are still on the books for after ECB’s statement tomorrow – though, USX going higher to invalidate the wedge reversal signal is the most likely.

    1. Gary Post author

      The movements in the dollar make it easier or harder to push gold where the bullion banks want it to go but they aren’t the reason for gold dropping. Gold can rally along with the dollar and has done so many times. It rallied 180 points last winter as the dollar went from 88 to 95.

  3. Galen

    The best thing for gold would be for the Fed to get that interest rate hike out of the way and get that psychological barrier out of the way. The Fed is doing a lot of hand wringing right now wondering if they will lose control if things don’t go as planned. You can bet they will have their finger on the button of plan B if they go thru with it.

  4. MuffinTop

    This is where it gets a little dicey.. Gold is way overdue for a bounce and the Miners are trading near short term support and diverging from the shiny metal. Buying Miners with a Stoploss underneath support is technically considered a good trade ?

    Ps: And I agree with Gary.. Gold does not always trade inversely to the dollar. It’s important to remember that the rules we’ve gotten so use to over the years no longer apply thanks to this artificial environment of ours. Bastards!

  5. Mark

    Gary,
    you suggested in a comment a few days ago that the Biotech sector could be one of the major beneficiaries of the bubble phase you are hypothesizing.
    Would you sell some gold/silver shares like PAAS,FIRST MAJESTIC OR SILVER WHEATON and switch to biotech stocks such as Sareptha therapeutics or Sorrento therapeutics?
    Thank you

    2. Gary Post author

      I would never pick individual companies in bitotech. I also think because the 7 YCL was aborted prematurely that we aren’t going to start the bubble phase until at least the middle of next year. So there’s no rush right now.

      1. Mark

        Thank you Gary,of course I’m always anxious since I would like to regain at least a part of the enormous money I have lost.

  6. Johan

    Hi guys,

    I don’t get the people here who are soo hung up on gold being manipulated to the downside, I find it amazing. Consider that gold has been among the strongest the last few years among the commodity complex, so if anything I would say manipulated to the upside:).

    Hellooo – all commodities have gone south the last few years, hell look at industrial commodities. Why would you ever think that gold is somehow manipulated to the downside when it has in fact been among the strongest commodities.

    Guys just relax and trade it as the capitalist market it is. If you feel it is always manipulated why would you even bother to trade it…

    1. Gary Post author

      One can make really good money during bear market rallies. You just have to try to time when the bullion banks are going to be done hitting it.

  7. Johan

    I would rather trade with the trend, that is where the easy money is made. Very well known advice, but still valuable.

      1. Mark

        The entire world is awaiting this new “capitulation”….:-)
        I continue to hear podcasts and continue to read blogs where all are waiting to buy gold after the next “capitulation”,,,,,
        Take this guy….he is suggesting the biotech stocks that I’ve mentioned a few comments ago…he would even like to buy gold stock but AFTER THE NEXT CAPITULATION !!!!
        http://jaytaylormedia.com/chen-lin-shares-top-pics/

  10. Braden

    I don’t think given where we are in the cycle and the distance below the mean the trade should be short.

    Gold could rally $100 overnight with some unforeseen news here guys.

    In my 30 years I have seen these squeezes before in commodities. Anyone that has only been trading for less than five years has been sheltered from waking up to a 20% oil rally. Believe me. It makes people millionaires or bankrupt overnight and it takes no prisoners.

    I believe we are very close to a short commodities covering rally and high frequency firms will flip trades and generate an EPIC move. Make no mistake about it and trade safe.

    1. Tushar

      Thank you Braden! I appreciate sharing valuable thoughts and insights… Good Luck and trade safe.

  12. AlexP

    VICTORY!!!
    SPX=2104 was my maximum level, the DCH, for SPX during this daily cycle, the top of the dead cat bounce which I called on Sunday, NOV15, and called several times ever since 🙂 –> SPX topped at 2104.27 today before diving.

    But of course, some will say it has been just [another] “guess” and will continue their inherent ridicule.

    1. AlexP

      next targets. I’ll repeat myself:
      – tomorrow a bounce as ECB increases its QE gun capacity but it should be capped by the same 2104 notch
      – low arround JAN8 at about 1950 (minimum 1920).

    2. victor

      as for me, I listened, bought yesterday HVU (triple VIX S) good profit, closed. Didn’t have chance to buy another portion today at 104. Hopefully tomorrow we will come to 100 again, will short SPX with HVU again till January…

      1. Gary Post author

        Yep that was a good call on the stock market. We’ll have to see if the Fed will suffer to let stocks correct ahead of the FOMC meeting though.

  14. JT

    With the poor action in Gold and Silver, the miners should be hitting rock bottom themselves, but they’re not. Very, very strange….

    1. Bud Fox

      JT

      Miners have been crushed compared to gold.

      That’s the problem with only looking at daily action. One must always look at longer time frames.

      YTD
      Gold -11%
      HUI -32%
      GDX -25%
      GDXJ -21%

  15. Allah

    I hate miners… Nothing but loss after loss. I will never trade miners again. Or even attempt investing in them– what absolute losers, totally the wrong sector time and time again.

  16. Dan

    “Capitulation” would come at something insane like $500 gold and $5 silver, how many bottom calls have we heard the last few years. If not, probably need to base out for years until the next bull, like biotech did for a decade.

  19. felix

    Sorry Gary, but something here escape me…. how can be a bear market rally if, as you said, the next one is the REAL BOTTOM….

    Felix.

    1. Gary Post author

      I thought the July low was the final bottom. I was wrong. The coming bottom is anotehr chance for a final bottom. It has to occur during a yearly cycle low and that’s what gold is dropping into right now.

      Or it could push out to next years YCL. We are getting a lot of similarities to the secular low in 2001 though so it’s possible a final bottom will form soon.

  21. William

    I think HUI “must not” hit lower low versus Sept’s low…otherwise, gold’s further chopping to the downside will be “validated”. So far, miners have invalidated gold’s lower low…therefore, we’re at very crucial juncture again.

    Therefore, gold can go lower and test 1,020-1,030-ish zone, but, miners must not go further than its Sept’s low…else, it would be utterly negative!

  22. chris

    2104 is a good call, at the moment. Could be just a pullback. I already mentioned stops must be tightened. Let’s see if market can rally of here.

    Back to gold. People here still arguing over the need for capitulation. Lol. It has done tis few times bounced and failed over the years. Now it’s making new lows. So it still need another capitulation. Big sell off first on huge volume. Eventually one of the capitulation will work. Qn is, is it tis one, or at 950, or at 750???? Who knows.

  23. David Silver

    Willaim:Next gold intermediate bottom Jan 2016 i.e. 1025.25 which makes total sense now.
    Then next intermediate top mid March 2016 i.e. 1146.42.
    Then intermediate/final bottom mid Jun 2016 i.e. 956.20.
    All figures are derived from my theoretical timing bands.
    I’m still long crude since last Tuesday (playing OPEC pop)?

  24. chris

    I got bad news for you guys. Gold and silver made new monthly lower low. Ie there is follow through on downside. My stance is , 1970s it din break a whole number $100, this bear will break instead the whole number $1000 mark. It will make those premature longs cry in big pain.

  26. tim

    the last top in gold was on oct 14 at 1187,
    the last heaviest volume day at 126 m in gdx was on the same day,
    gdx traded a couple pennys higher the next day but less volume,
    you can call this anything you want but it works very well in trying to
    trade a bottom or a top.
    i

    1. Gary Post author

      I’ve only seen two false bottoms so far. One can only cry wolf so many times before everyone starts ignoring you.

      Notice the attacks now have very little follow through anymore. ICL’s only drop 50 points or so below the last ICL before bottoming. It’s becoming more and more dangerous to continue trying to manipulate the marekt lower as there just aren’t any longs anymore so there are almost no stops to run.

  28. Jay

    I cautioned everyone on Monday that, most likely, the right thing to do is put orders in to buy GDX in the single digits and walk away from your computers until the orders eventually get filled, but I was laughed at. 🙂

  29. AlexP

    yeap, Gary, as Ive mentioned before, I think FED will do nothing and move on its rate hike to rejuvenate world’s trust in it that it is not an undiscriminant all-out money printer aiming to prop US federal budget by inflicting inflation on people as an add-on tax (as many had started to believe).
    So, it will save face by delivering the first rate hike on DEC16 and another one in early summer (it will prudent though and it will allow 6 months to see its economic repercursions).

    Getting started to trade:
    – short T-notes today and
    – short stocks tomorrow after Empl.Sit. (the stronger the figure, the safer and larger the weight of the short in my portfolio).

  30. AlexP

    I think USX will break above 100.72 today (ensuring the right-translation of the current 3-YC) and DCH to be established tomorrow on day 10 –> selling climax in gold tomorrow.

    Then the next daily cycle of USX will produce a higher high on FOMC day and will fail shortly after thus delivering another shortened intermediary cycle –> it will be right there, as USX finds its intermediary cycle high immediately after FOMC (either on DEC16 or on DEC17) that long gold will be warranted as it will rise into its new intermediary cycle.

  31. chris

    Bears and shorts, like I said, looks like a pullback, a one day drop as R2K is so overbought on a shorter time frame. So don’t blow the trumpet and declare 2104 as a big vitory.

    Futures and took out several key levels. It makes yesterday a one day pullback very likely. NDX is only 10 points from yesterday’s high!!!

    Short the market, I prefer buy pullback unless the inverted HS right shoulders are broken downwards.

    1. AlexP

      I’ll buy the pullback myself but not any sooner than JAN8 with SPX around 1950 –> I’ll be able to draw a better estimate of the low shortly after the FOMC.

  32. AlexP

    the moves of Treasuries and of USX place [at least for me] the onset of the next bear market in stocks in the 2nd half of 2017 – two years from now we should be in a bear market.

    we will have plenty of space to long stocks, though, through several intermediary cycles until then; the first one will be from January through May (ICH in May/early June the latest).

  33. Bud Fox

    One of the best articles written by Trader Dan.

    http://traderdan.com/?p=8229

    There is no “capitulation” until people STOP LOOKING FOR a REASON TO BUY GOLD. The gold oriented sites continue to stay married to their yellow metal god no matter how far it drops. As long as they keep doing this, there is no capitulation.

    What is so tragic about all of this is that many of the people who were hoodwinked by the gold gurus and the various gold-oriented websites and newsletter writers and who “backed up the truck and loaded it up” are now too old to ever have a realistic chance of recovering from their massive losses.

    1. mike trike

      Here is Dan Norcini in Aug 2011, right at the top. He is bullish as hell.
      Here is Dan from the comments in the article:
      http://traderdannorcini.blogspot.ca/2011/08/monthly-gold-charts-august-2011.html

      “I have to laugh at the comment by one named Judy who talks about the “smart money” shorting gold. I wonder if those were the same ones who were so smart that they shorted it all the way up from $1500 and go a good education on the power of leverage to destroy one’s trading account. To believe gold is in a bubble one has to believe that the fiat currencies being issued by the governments of the West are rock solid. It is also to believe that there is no inflation problem raging across China and other various parts of the far East. All markets correct in price and experience price retracements in ongoing bull markets so it is not unexpected that gold has seen a price setback from the $1900 after putting on $400 in six week’s time. A time of consolidation will do it a lot of good.”

      Pathetic!

  35. bhowe

    Gary,

    I thought you were long SPX thru the year. I believe you called it a safe bet that the government won’t let it correct. I see Alex P is calling a top now, are you in his camp now?

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