I’m pretty sure the PPT has halted the rest of the drop into the 7 year cycle low. This probably means gold enters a trading range for the next couple of months, oil has bottomed and will likely rally to $40, and the dollar has likely completed an intermediate degree correction.
Smart Money Tracker
Excellent video given the swing lows in $WTIC, $SPX and the $USD. $Gold rallied when everything was dropping, now we get to see if it can rally out of it’s DCL and make a higher IC high or give us 3 DC’s. Plus, it’s always good to remind everyone (the kids) that we’re playing in the deep end of the pool and their isn’t lifeguards on duty! ?
Gary,
would you take advantage of the correction in gold and miners to buy more or would this strategy to be risky since this could be a bear trap and gold could make new lows?
(it seems unbeleviable but sentiment is becoming bearish again in gold everywhere I take a look at)
Unless stocks roll over and break through 1825 I’m going to assume the rally in gold is over for now and just wait until the next ICL before buying back. That won’t be due until late April or May.
USX is not in a new IC; it hit merely a DCL not ICL on Thursday – its rise is going to be capped as this new DC will prove left-translated too.
The only thing that can prove it otherwise would be a FED rate hike, but that’s unlikely.
Stocks and oil are in new ICs indeed, though.
Don’t worry yet about gold guys. It haven’t breached its first important level of defence. Second, stocks is merely bouncing, I said last week it has high chance of bouncing to 1930 ish. So reshort when it shows price weakness. USDJPY breaking 100. So , markets making new lows.
In fact, based on certain price behaviour, cash market looks like tanking already for tomorrow.
That’s the problem if you subscribe to voodoo theories that the natural path should unfold according to your own pet theory (cycle theory in this case) – when it doesn’t happen you blame conspiracy and outside influence rather than accept that your grand theory of the market is incomplete and imperfect.
It doesn’t matter what causes it, only that you trade it correctly. We have traded it correctly.
Q, my answer to ur q:
there were 4 classic cumulated traits of extreme fear on FEB6: extensive put volume on a market falling on large volume after a dead-cat-bounce. This combination is a cocktail of ensuing havoc to exhaust the bear quickly, in a matter of days in the wake of the hazard.
at the same time, bullishness was enforced by :
– favorable multiple divergence with oscillators and with VIX,
– the late timing band for the IC since AUG24,
– transports had got in relative strength with broad market for the first time in many months.
SO, ON FEB7 THERE WAS ONLY ONE COMMENT TO BE MADE, THE ONE I DID CALLING FOR A SHORTENED DAILY CYCLE WITHOUT ANY TRACE OF MANIPULATION, JUST SHEER MARKET ACTION
At Wednesday’s low the intermedite score never even came close to either the Jan. low or the Aug. low.
At the Jan. bottom and the Feb. bottom the short term optimisim index didn’t even reach bearish levels. No intermediate cycle low in history has ever bottomed without the short term optix hitting extreme fear levels.
At the January bottom and the Feb. bottom the short term mean regression model never reached oversold. No intermediate cycle low in history has ever bottomed without the STEM model hitting massively oversold levels.
At the bottom this week the total put call ratio was completly neutral at .92. At all other intermediate cycle lows the put call ratio has spike over 1.0 and most will spike above 1.5. The Aug. bottom reached 1.69.
And finally there was no bloodbath phase. All intermediate bottoms should end in a 5-7 day bloodbath phase when a key technical level is broken. We were setting up for that to happen when the selliing pressure was terminated.
So sorry boys you are wrong, there is nothing natural about this bottom. What we can hope for is that the rally will fail very quickly, roll over and complete the move down into the ICL and trigger the rest of the signals that a true ICL has been completed. I don’t have high hopes though.
Heck even Jim Rogers acknowledges that central banks are trying to artificially prop up global stock markets.
Alex – thanks for your reply. I feel much more enlightened 🙂
welcome, Q
Wednesday’s FOMC minutes will be the catalyst for 3 things:
– USX-stocks correlation to inverse
– USX to reach its DCH and rollover while stocks to continue their bounce
– treasuries to take a deep dive into their DCL.
Thus, stocks and gold will correlate positively: both will be on the rise 😉
Ok, gold has broken a pattern during its huge rally . Gary’s scenario of gold, stocks and oil is in play.
The only problem is that nothing about the bottom on Thursday is indicative of a final 7 YCL. That needs to be so severe that it looks like the world is ending. The Vix didn’t even close above 30. That is not an end of the world type move. It means there is still more to come. The only question is will the selling pressure break this intervention and finish the move over the next 3-4 weeks, or do we have to wait through another entire 20-25 week cycle before it has the next chance to complete the 7 YCL.
exactly, Gary, this has been my point since the break of 200Wma of Nyse on JAN8: we need time for this bear to work its way just like an influenza its rush for 2-3 days before its over.
Except that for stocks such an “influenza” would cause many months …
So, we are fresh in a new IC, this IC will go high above 1970 for SPX and, at about the time VIX shakes its 200dma and treasuries are in the timing band for an ICL (some 5 weeks from now), then WE WILL BE ABOUT THE ICH IN STOCKS, THE END OF AN ENORMOUS DEAD-CAT BOUNCE, and stocks will rollover with a final bottom in SEP.
Confess my ignorance of cycles but agree with your analyses. Personally believe we saw the low for the stock market last Thursday and bought emerging markets. oil, materials and capital good stocks last week in hopes of new market leadership out of this correction. Financials also look good as an anti gold trade. Silver miners look like a good buy in … July (seasonal’s). Generally a buy and hold guy with a longer time frames never dreaming I’d have to get this “flexible’ just to survive. Good luck all.
Wow.
From the bull is back to trading range for weeks.
Nothing has changed. It’s all dependent on what the stock market does. I do think the bear market is probably over, but to get another big leg up in gold, stocks have to finish the move down into the 7 YCL. If that is delayed then the rally in gold will be delayed.
I was expecting a bounce in the markets, not due to ‘manipulation’, but the charts were saying short and long term too.
This is the longer term view, and why the markets will bounce here. Notice that weekly 200moving average and a trend line.
.
http://www.screencast.com/t/dPlenoHllsiB
And the reason for a trading range in Miners after a noce run up? Just looking back at prior lows in XAU. It wasnt straight up, it went sideways for months. Its all in the charts ,
http://www.screencast.com/t/X2hLPehuUrd
Sorry but 86 was not a bear market bottom. 2009 was and you can see what a rally out of a bear market bottom looks like.
Yes, you can see that I called it “Prior lows” of 87…it was coming out of a sell off and rallied strongly, but still had a long consolidation in the middle. That is normal accumulation / distribution, not always due to some Government manipulation hampering progress of the retail investor.
Thats why I went way back to a time ( 87) that no one felt that paranoia, but we see that the markets still ebbed and flowed as they do today. Yes, Markets do move with big money, and Big buyers and big sellers do stop runs to be able to buy larger positions in the selling, Big money does often do a partial sell into buying frenzies ( And even short to hedge, so the COT rises) but every move isnt there to cause you harm. They need to move big money around, and that takes buying the dips and selling into rips.
Just pointing out that It shouldn’t turn into a paranoia prognosis, or one can become too flip floppy and paralyzed with fear. If the lows are in, we should see Big Money buy the dips and accumulate again.
And I agree, the rally that you pointed to out in 2009 was out of a much smaller selling period ( bear mkt) than the multi year sell off that we just saw.
How this one unfolds could be rather spectacular.
1200 looks shaky bull trap lots of longs caught on wrong end. Just wondering if it will retest lows of December . Blood bath on metals when it opens up tomorrow. This bear market will be drawn out for a good part of this year.
As I told subs this weekend there was something fishy about the run up in miners on Friday. They should have been down marginally with gold. One should pay attention when things don’t behave naturally in this most heavily manipulated sector. It almost always means something is going on behind the scene. In this case the rally in miners on Friday was to create a buying panic so smart money could sell their shares at the top.
I’d say the miner herd didn’t see the tiger coming their way Friday afternoon…GDX…up over 2%, yet GLD ended down over 1/2%
The higher move in GDX vs the down move in GLD was a red flag to get out of the way before the aftermarket closed on Friday evening. Looking back though, the earliest warning the miners was about to tumble happen when the DOW halved its loses around the time auntie ended her meeting last Thursday…IMO
Lightening up on the miners last week is beginning to look like a good move. 🙂
gold will not continue to rally further, it may rebound from here, even go a little higher, but then it will drop like a stone. 500/oz is the target for later this year. Prepare yourself.
Bloodbath term is way over used.
It’s just my term for the final 5-7 days of an intermediate decline. This is when traders start to panic.
Perhaps gold is going to trade down in to a icl, and the market will trade up for a daily cycle then fail on its second daily cycle bringing in the much greater decline that we were expecting? My only issue with that is the miners making a deeper low in Jan, so to me the hui, looks like it’s on its 2 at daily cycle, but I imagine Gary will say is not tree miners that drive the sector, that gold does, and it didn’t make a lower low.
Gary
do you feel gold still has a higher high coming? I found a page that showed the correlation between the Yen and Gold and saw extremely amazing similarities the only difference is that the Yen is a leading indicator by a couple of weeks. Gold nearly moves to a tee following the Yen.
https://4.bp.blogspot.com/-ihbJ-7d8QJ4/Vro6Gh7icsI/AAAAAAAAG-c/58IucHnpmfU/s1600/3.png
this nearly showed that gold will retrace steeply for a couple of weeks then rally to a higher higher.
a second support in very bullish gold outlook is the comparison between now and the 1970s, after a multi year bear trend, shortly after gold busted upwards (ending the bear) every retracement was very small. It will not give anyone a chance to buy very low, this may line up well when everything heads into a bubble phase
It simply boils down to whether stocks break the intervention and continue down into the 7 YCL.
Gold sniffing out a bottom here guys.
You guys need to stop watching 5 minute charts.
There are many gaps to fill on the $HUI.
132 and 111
Patience.
I expect SPX to make all time highs this year! Period.
Woods is a cycles man…He says, even though this last gold bounce up was a big one, gold should continue DOWN. http://www.howestreet.com/audio/Wood_Tim_2016_02_111.mp3
Speaking of Jim Rogers, he recently mentioned that he expects gold and silver to make lower lows, and is not a buyer at these prices, and hasn’t been for a long time, although he keeps a portion of his wealth in gold and silver at any given time.
he wants yr gold Russell..
Stocks UP driven by PPT. Dow 16,000 defense once again magically comes in overnight. “No More Correction for You”, says the PPT to hopeful shorts dreaming wet dreams of SPX 1600 or lower, and DOW 14,000. Better luck next time boy bears; PPT men have taken over. SURPRISE!!
Oil up in tandem with stocks and driven by news of OPEC cust(ceasefire deal between Russai and Saudi over Syria). It will last as long as the ceasefire and no bombing by Russia in Syria lasts, Has potential to go to $50.
Gold down below 1179 support and more? Then 1139, then, 1090? Personally, I think a lower low is coming for gold down the road. Deflation may get stronger by / in 2017 thanks to the stupid Fed.
Amazing, in just 3 trading days everyone has switched from BULLISH to BEARISH on gold and miners, lol.
Gary went from saying not to trade the bull market to saying hedge/take profits. Every site I visit today is full of bears quoting Martin Armstrong and all the gold bear gurus. I see the stock market bull posters climbed out from under a rock to post today, lol.
Bob Hoye says that after daily upside exhaustion alerts in gold like we have just had, 2 to 6 days of correction historically follow. Bob is rational. I see this move down in gold as a good development and the fact that silver is above $15 is actually surprising to me.
It’s true!!!!!Absolutely amazing…..no more bulls anywhere!!!!!
The world is so accustomed to this bear that at the first sign of negativity it returns quickly into its arms!!!
Gold is just moving down into a DCL. That is not unexpected. BUT…
If the selling in the stock market has been terminated prematurely then the buying pressure to drive gold higher into a second leg up has been taken away.
Gold needs the stock market to complete the move down into the 7 YCL. That will drive gold radically higher and it will trigger QE4.
Things are fluid right now. Don’t get locked into any scenario because we don’t know yet whether the market will break the intervention and continue down or whether the PPT has succeeded in stopping the correction.
Give it a couple of weeks to see what happens. Then we should be able to figure out whether gold has topped for this intermediate cycle or whether there will be another leg up.
That’s right… No predictions, no bias, we are just going to let price and cycles tell us where to be and when to be there. It’s not about being right or wrong it’s about making $ and being on the right side of a trending move up or down. ?
Speaking of Bob Hoye, he called this recent move in gold perfectly in his December 6, 2015 free article on 321gold.
http://www.321gold.com/editorials/hoye/hoye121015.pdf
He is now calling for a 2 to 6 day correction before a move to new highs. His exhaustion alert was triggered when gold moved above $1200.
http://www.321gold.com/editorials/hoye/hoye021316.pdf
Bob Hoye is one of the few people who called the 2008 meltdown perfectly and he is usually correct.
Great call on gold Gary the last couple of weeks. I’m glad I followed you here after following you on the Korelin report.
I agree with you that everything about market action (S&P, miners) was suspect. What a great opportunity for those forces that desperately want to ignite a rally to kick it off in a relatively low volume/start of holiday period. The markets look more like a heavily manipulated casino then a normal ‘honestly’ behaving market (whatever the definition of ‘honest’ may be in an environment driven by financial greed.
I still see an option for the market falling like a knife again tomorrow. I’m not sure if the market makers can keep oil elevated, and if global storage capacity is full, I mean, really exhausted – then that’s it. The oil price might drop like a stone, and it will take all these fantasy price levels for the conventional markets down with it.
According to Avi Gilbert’s Elliott Wave we’re heading for a 17-handle in the S&P in the coming weeks. I give it a more than 50% probability it’s going there rather sooner than later.
Don’t mention Avi Gilburt on this blog 😛
Avi gilbert … oh well… What a snake oil salesman .
For a guy who claims that he called the top perfectly, you have to know what he was saying in december
2011 when gold was at 1600$ and expecting 2300$ …
“In the event that gold does find support at one of the higher levels, then the higher targets for the metal that I left you with the other day are still applicable: $2,111 (2.236 extension), $2,232 (2.382 extension), and $2,429 (2.618 extension).”
http://seekingalpha.com/article/316050-gold-at-2000-coming-sooner-than-you-think
Gary… I almost never dare to disagree with you but this time I think you are giving too much credit to PPT and stocks will do to 1730.
Just my 2 cents.
The only problem with the bearish / neutral outlook on gold is that currently we are in a bull market.
The fact that everyone wants to take profits / sell / hedge etc means only higher prices ahead without participation. Too much emphasis is being put on gold vs US equity market correlation. I dare to say even USD correlation should fade a bit – after all, EVERY MAJOR CB is printing money. Why would you ever sell gold / fade the up trend in this case ?
If ECB prints money and moves EURUSD lower – would this translate into lower gold. Not anymore as sentiment shifted. Gold bull run is just getting started and patience is key. Today’s move does not matter. Low volume (1/3) of Thursdays when it moved 5% higher showing big central banks buying.
In more poetic terms we could say “The golden dragon has awoken”.
Gold has only retested this lovely breakout. Tomorrow the markets will make an about face and go red again. Gold will launch higher.
http://i.imgur.com/IL7QPFS.png
Golds already been clobbered. Down to $1196 already.
We will see $1150, then $1100 in no time.
Gary you ain’t suppose to say gold ain’t going up. Some gold bugs here will hate you. I guarantee you some did not sell. Thinking it’s a super bull run. Then when gold breaks, say 1000, they curse you for saying it’s a bull run. Forgetting you recommend taking profits
lol, Gary said not to trade the bull market last week because surprises are to the upside. Anyone who bought GDX or gold or NUGT into this latest parabola is an idiot. Select junior miners are where to put your money. When Gary gets really bearish and says he was wrong and a lower low is coming in gold then I will load up on GDX calls.
Looks like the new bull market in gold is already over.
News flash.
During a bullish trend, stocks do not go up every day.
During a bearish trend, stocks do not go down every day.
“Yikes! Did we just see a bear trap in stocks on Thursday and a bull trap in gold on Friday?” Holy Strawberries Batman we’re in a real jam.
TFF !
There goes 1200.
Not such a great night to be a Schiff-tard! (Gold futures down $42 currently) 🙂
AND the trolls are back posting with their smiley faces after having missed the huge run up and probably don’t own any puts right now either, lol.
I’m up 3.6% tonight compared to Gold. LOL
I had a feeling that the fed would abort the metal bull, and now that appears to be playing out.
My puts I bought last week will be up 30 to 50% by tomorrow. I will sell next week for a double then wait for it to get extremely bearish here and buy GDX calls. Rinse and repeat.
Meanwhile my Canadian miners have been going up for almost 3 years now. lol
There will be a DCL in gold probably at the end of the week after OEX. One should buy that cycle bottom but be careful in case it fails to make new highs and signals an intermediate top.
Where’s the PPT for gold?
Sorry, gold only has PAPT.
Gary
I think you pissed off the big boys with your humble pie post.
Payback is a bitch.
It’s too late. We already exited in the Quest and I told everyone to hedge last week. The SOB’s didn’t catch us, although they sure robbed all the traders that bought into the rally on Friday. I knew that rally was fishy. Clearly a trap to sucker in retail traders so big money could dump their shares onto them.
I’m getting pretty good at sniffing out the manipulation in the metals sector both to the upside and the downside.
http://blog.smartmoneytrackerpremium.com/2016/02/hedges-could-now-be-placed.html
Mike is a permabull. I am a practicalist. I made good money during this bull run, having caught the bottom. Its just a trade. And in a big picture, gold could just be making a huge bounce. Note that it did not clear certain trendline, and only tested its 200ema. We have seen this before. And gold fails. I dont have a crystal ball. The high volume on Thursday could be a blow off top. And to those permabulls who keep saying gold is a buy, the rest should open your eyes and be careful.
Read my posts last week, I was buying DUST and puts.
To those doubters, Index could be like Feb 2014, up and up, and gut the intestines, gall bladder of the bears up! Key is tuesday. If closes well, likely this scenario
Oh really. My bad Mike. Good job. Respect.
Mike, this Bob Hye guy, does he have a line in the sand, say on the daily chart that says gold is just a bounce? No bull run.
Bob is more of a market historian. All I know is that he says support as of last week is around $1150. If Hoye says the correction should last 2 to 6 days then there is a good chance that gold will be going up in a week from now.
I am sure if you pay for Bob’s services he will go into much greater detail. Bob is always rational and calls general market directions very well. I ignored him in 2008 when he called for all the markets to crash. I will never ignore him again.
Ok. I see 1165 ish as the line in the sand. An easiest stressless way would be a trendline buy. Aiming for that
They are kidnapping baby bull off the roof in overnight gold barn put him inside a blac k bag tie the top blind, and then carryng the bag swinging down with a rope jumping and flying over roofs to take him to an undisclosed location, dubbed “The Wood Shed”.
It’s called bull trap discipline night.