145 thoughts on “ENTERING THE BUY THE DIP PHASE”

  1. Pedestrian

    Nice video Gary and you made a lot of excellent points about where and when to buy. The gold chart you have there is a daily and where we are right now shows a double top has formed with a reversal candle on top.

    Too obvious maybe and so it can’t be trusted? I don’t think so.

    Can I point out by way of comparison that every major mining index and ETF chart is currently in the process of breaching their upper Bollinger bands as the bands narrow and that implies a decline is coming. Possibly a strong decline.

    Some of these include GDX, GDXJ, GLD, HUI, SLV, SILJ, NUGT, XME, JNUG, SGDM, SGDJ and on and on. So the list includes silver and gold as well as more general mining stock funds. I think you mentioned 6-8 days for a pullback although from a cycle perspective as shown on the daily I think it must be longer and certainly when all the stars line up like this we would be asking for trouble to fight the tape.

    We all want miners and metals to go up. The time is not quite here though.

    1. bill

      Oh no lol

      http://www.marketwatch.com/investing/fund/nugt

      Look your a good trader Ped, you nailed a few calls, we all do but no man is a crystal ball not even you, I know shocking. The switch pullers see both sides of a trade behind the scenes and they seen everyone loading up short as a typical NFP Friday trader would….there are times where the house cleans the table, and from morning the looks of the tape the house did just that…again you are a good trader but no one can truly predict which way these markets will swing not even Gary…we all just guess and hop for the best.

      1. Pedestrian

        Well sure Bill. I can agree with that to a point. Reading the market is like predicting the weather. It just keeps changing. But if you have a long term cycle chart you can also find a support line 30 years in the future. Same way I am pretty sure it will snow every winter.

    1. Pedestrian

      Exactly like Gary said. Fools rush in to buy at the top when metals are already overbought.

      Nobody ever learns.

        1. Pedestrian

          Boz, that is always a possibility and nothing can ever be ruled out as an absolute. I work with the probabilities and most of the time I have success. If you are familiar with Bollinger Bands you might want to check your stock charts or gold/silver indexes yourself. Like any technical it is not a guarantee of an outcome but as a general rule when price pierces the top of the band you anticipate a decline and when it breaks through the bottom you look for price to rise. These can be pretty nuanced though and there is hardly time to explain it all. My point above was that ALL the precious metals and miner indexes and ETF’s that I normally check are telling us a bearish bias is in the works. So stay cautious. I don’t want to lead you astray here but rather offer some technical perspective that might be helpful.

          1. dboz

            Yes, helpful info. These you mention could drop. They could also just take off again. Remember when it was going down and you kept saying that bulls were crazy for not seeing it? Well, I am saying the same to you on the way up. I don’t care about those technicals. Yes, they may help you. I just follow the money. Money is pouring in. In a bull market surprises happen to the upside. I said yesterday I expecting an up surge as EVERYONE was expecting a down break. So far so good. NOT GREAT by any means but no collapse to 1150 either. I am closer so far. So just keep an open mind that we could just be consolidating right here and now and that the next move could and should be explosively upward.

          2. dboz

            I assume that is also why GARY named his site SMART MONEY TRACKER? Price is the ultimate indicator. I see we are going higher here.

          8. dboz

            I don’t think you will, but we will find out! I say the rocket is on the launch pad and ready to make a significant up move. Dollar is toast. No rally is store. Today proved it.

    2. MegaMind

      Adrian, I have march as a turning point for metals aswell… looks like we will head higher for next 6weeks…

      1. Adrian

        MegaMind: Any way, I think Gary is right, just now do not seems to be the best time to buy Gold or Silver, until oversold and next cicle arrives

  8. Option Trader

    Strong payroll number this morning….. but hourly wages have gone down.
    Not likely Feds will raise rates in March.

    Metals so far, holding their own…

    1. Gary Post author

      Yes.
      This will probably just boil down to whether the dollar has formed it’s DCL or not. We may not really know until Monday.

  10. Goild

    The miners are strong.
    They did not fall as much as gold.
    Today is payday and so SPY may close higher.

    1. Arthur

      Usd/Jpy is traded on non regulated market (forex = otc market, over the counter).
      Its priced in usd (how many yen for 1 dollar)
      (Order is -> I bought or sell x $us against yen)

      Yen futures is traded on cme ( regulated market -> http://www.cmegroup.com/trading/fx/g10/japanese-yen_contract_specifications.html )
      its priced in Yen ( 1 contract = 12,500,000 Japanese yen )
      (Order is -> I bought or sell x yen futures contracts at maturity y )
      you can trade options on these futures contracts.

      Yen futures are a derivative of forex Usd/Jpy.
      In both case you trade currency but either the underlying (forex) or the derivative of the underlying (future market).

  13. Option Trader

    It would be very good news for the bulls if we have an hourly close at 11am, in the green. This would confirm the bearish/selling volume in to bullish/buying volume.

  14. jonsyl

    as I’ve been saying nothing to do but watch unless you’re a nano trader. Vix telling you complacency abounds as most feel the best is yet to come with tax cuts and deregulation. Unless vix moves with conviction on some event not worth risking a position.

  19. Steffmeister

    About predicting markets, I’ve seen a guy pointing out a low in Gold 13months in advance. That is impressive!

    No it is not possible to predict the future, however if the pattern plays out in a certain way it’s possible to do scary accurate prediction like the one I pointed out above.

    There is proof of the chart with dates and everything in a forum near you 🙂 I am going to post it here, just wait a minute or 2 …

  20. Don

    Gary, buying the ‘dips’ looks like a brilliant strategy and it works well in a bull market. That said, you have repeatedly stated that breakouts are a bad time to buy so that would mean that anyone who has bought on a dip should sell on a breakout. Correct?

  22. Don

    I love playing commodity related assets. At least there is some semblance of rational in that they generally respond to supply and demand. I hate playing the stock markets since they have been hi-jacked by the banks and companies buying back their stock no matter what the price and without regard to fundamentals. Studying financial reports has become a complete waste. of time. Since the game has become all about taking money from the many for the benefit of the few, it is now all about sentiment and not much else. The term ‘investing’ now really means ‘gambling’.

    1. WallStreetJesus

      Commodities (futures) have many advantages tax wise over stocks.

      I just bought some Cocoa, haha we will see how that trade works out.

    2. jeffd5584

      Good point Don. The stock market is the most widely followed (by the masses), so it’s nothing more than a political tool (Gary has mentioned it as have many others). I sometimes LOL while watching how stupid the charade has become. Two instances in the past year come immediately to mind (although today could make the top ten…Note: no matter the number on NFP, the machines always “buy)…Last year (sometime in late april), the Nikkei crashed on some moronic statement by Abe. Literally down 600 pts or more, ES immediately reacted in the over night market lower, then did another robo-buy, at one point up maybe 20+ pts off the overnight lows…finally near the end of the day it sold off hard.

      My favorite are big earnings disappointments that are simply papered over via VIX manipulation or crude oil gunning. It’s just a bag of tricks market with no real liquidity. If/when the momo gets going on the downside, they simply shut down some exchange and then pummel the VIX into submission and break off the momentum.

      It just seems that nothing works any longer if the markets even “correct”. A year ago we were 27% lower than now…Think about that.

    1. Robert

      The time to short the stock market must be soon tho? Maybe on the next gold bottom it should be the catalyst for 1300+ me thinks

  25. Option Trader

    Well, we got the hourly close in the green for SLV. This should bode well for the metals.
    We are at resistance here so I’m impressed that it is holding up well
    SLV is flagging here… so it will be interesting to see a break out,
    Miners are leading the metals but I’m somewhat concerned that GLD is leading SLV.

  27. Strike

    Consider an alternate scenario – same outcome, different path. I don’t favor it, but i acknowledge its existence as a possibility.

    Everything is so buttoned up neatly in Gary’s and Ped’s nearly identical scenarios. Down then up for gold. Logical explanations for each. How can you go wrong? Especially since it basically agrees with my own preferred independently-arrived-at path, except for gold’s target price?

    Here is how: look at Jan – March 2016. Never a pause. just up up up. What if DXY decides to go straight down from here without firming first? And $GOLD correspondingly takes off from here to 1320 or so? A lot of people will then miss a NUGT/ JNUG double. And would miss a lot more if the recent 1377 high is tested.

    For the record this is not my favored scenario – my leveraged position is near zero. But I am uncomfortable when my favored scenario gets delivered with a bow on it and is even wrapped by two of my favorite analysts. And I understand the likely cycle outcomes, and the historical accuracy of the Nikkei/Yen/Swissy etc thermometer. But I am not 100% comfortable.

    Maybe that’s a good omen.

    1. jeffd5584

      Agreed Strike. I find that my best trades in this market seem to make the least sense when I initiate them. i.e. my confidence level is low. OTOH, my worst trades seem to have all the logic behind them, but it’s usually just another trap. There is just a heck of alot of predatory algo behavior happening that creates a very “stop and start” type of environment. No matter the market, a lot of gaps, a lot of gap and stalls and a lot of discontinuous type trading nowadays.

    2. Bv

      Thanks for mentioning this as this is what has been playing on my mind as I missed part of the gain made in the miners last year when I sold, expecting a retrace and as you say, it never happened. I’m in exactly the same position now sitting in cash, waiting for a retrace before buying again. Is there a line in the sand? Ped has talked about $1225 for gold being a ceiling, if gold breaks that and holds, are we off to the races? Thanks everyone who posts, been some excellent discussion lately with very little sniping.

      1. Gary Post author

        This is the mentality I’m trying to break with this video. This is how most traders think.

        “If such and such a price is broken then away we go.”

        The problem is the vast majority of the time that kind of thinking doesn’t work. Once the initial impulse off the bottom is over then what tends to happen is that once that target price is broken a profit taking event occurs.

        This is why I say most traders buy breaks and then lose money when the break outs don’t deliver a sustained move.

        During the middle phase of an intermediate rally buying breakouts is almost always a losing strategy. You need to buy dips.

        1. Pedestrian

          Just putting a price on it Gary. No crime in that. What will not go down usually goes up so it just means having a target that is a line in the sand. All I am doing is reading the charts, not trying to second guess. I appreciate what some guys are saying about it being difficult to trade because charts can’t always mean what you think they are saying. It’s like there is two interpretations for every pattern. What can we do except try to choose wisely then not fight the tape. Hell, I can’t really say I know for sure (even though I said 100% in jest). So we wait now until Monday. If gold goes up the bulls here (majority) will be vindicated and can enjoy the bragging rights.

        2. Bv

          Gary Post author
          January 23, 2017 at 6:24 am

          Gold still hasn’t produced anything identifiable as a half cycle low, so we could get a 2-3 day dip this week.

          Don’t let it freak you out if it happens. It will be a buying opportunity.

          Or gold could just break right through the resistance at 1220 and leave everyone behind that tried to get cute.

    1. macman1519

      Gold is stuck, no force up, get ready for the drop into pm with a major US dollar rally starting on Monday with gold goin down, be careful all.

  29. Goild

    Yes, next week may be a different story.
    Two days ago NUGT topped at around 12 and so it is likely that today ‘s $12:10 is the top for the week.
    I am done for the day with a green smile.
    Good trading to all.
    Enjoy the weekend.

  31. Option Trader

    To maintain a bullish bias:
    GLD needs to close today above 115.70
    SLV needs to close above 16.50

    Both metals are currently above Tuesday’s break out levels. We have had some big economic data come out this week that normally has less favorable reaction with the metals,

  32. terrywg

    @ped @zkotpen,

    just shorted gold futures at 1220. Long USDJPY at 112.56 and short EURUSD at 1.0783. No hard stops.

    we are going to end the day with USDJPY back within its corrective structure and EURUSD under 1.08. It’s looking very bullish for the USD in the ST.

  33. ras

    energy complex beginning to perk up. This could prop up the SM for a while. nugt pulling back to the vicinity of 11(+/-)?

  34. ras

    gdx/gdxj holding above the mid line of weekly BB for 3rd week. Minor daily dips notwithstanding, weekly trend likely up until gdxj pushes up to 42 plus. Time will tell.

    1. mike trike

      I remember that chart from years ago Steff. Mr Merlin and the whole forum are required reading for me every few weeks or months. Cheers.

  39. Option Trader

    GLD $115.70
    SLV $16.50

    Both holding support here. I’d like to see this continue into the close.

    1. Pedestrian

      That’s the lure to keep you captive over the weekend. It’s why I like to be back in cash by Friday. Got screwed too many times staying too long at the party.

      1. Option Trader

        I’d have to say that one of the best Video’s that Gary put out recently… discusses there only a few days, during a bull market move, that carry most of the gains up. The majority of days are in consolidation and most traders get caught trying to catch the one day thrusts. That’s pretty much a hard thing to do. As long as you allocate some long term positions to catch these quick moves, some money aside for day trading isn’t a bad thing.

  40. Option Trader

    I really like this blog a lot. And I like the fact that there are bulls and bears here. Because at the end of the day… we all see things differently and can benefit from someone else’s analysis.

  43. macman1519

    Went long gold for one reason, Trump, more uncertainty, threats and rediculous decisions by Trump and his cronies. Seems that as long as this continues gold creeps up. The weekend will have more threats between Trump and Iran, and who knows what will piss off herr Trump next. He will respond in his usuall bull in a China factory. Buy gold, it continues to climb the Trump wall of worry.

  44. Andrew

    This feels so much like last year with the miners. No real correction. GDX, GDXJ slowly closing in on their 200day moving averages and as LiesandDamnLies pointed out China will be back in full force next week. Metals look bullish too. Even tho gold has not popped through 1220-1225 there is also no real selling.

  45. macman1519

    Totally agree Andrew, but we have Trump adding feul to gold’ s booster rockets. I’m now of the opinion that gold hasn’ t a good chance of making any meaningful pullback due to the uncertainty, any small attempt at a decline will be immediately bought. Now how high will gold go???

    1. Andrew

      Interesting thought, Trump could be like a Greenspan put for Gold. I guess the pullback to 1180 is a good example, a lot of people had 1160 or even 1140 on their card, but it got bought rather quickly. Of course at some point there will be corrections, but for now you make a good point.

  46. macman1519

    How herr Trump is perceived by ourvallies and why gold will continue to rise

    MEDIA
    The Wrap
    Donald Trump Beheads Lady Liberty on Der Spiegel Cover

    German publication takes a stab at defining the new American administration
    Tim Kenneally | February 3, 2017 @ 10:25 AM
    der spiegel trump cover lady liberty beheading beheaded
    Give me your tired, your poor, your de-nogginized…

    German publication Der Spiegel is making waves with its new cover, which depicts newly minted American president Donald Trump with Lady Liberty’s severed head in one hand, and a bloody knife in the other.

    The coverline for the issue reads “America First,” a slogan employed by Trump to describe his administration’s foreign policy.

    1. bill

      Take that liberal EU trash rag fake news toilet paper elsewhere Mac. Look we get it and you are fully within your right to express your views, but there is a lot more behind Golds recent moves than Trump. How about China on the verge of collapse, Iran shooting fireworks and so on and so in.

      You obsessiveness with Trump or even the politics of Trump is meaningless gebberish. Run for office and charge things but you your own man never mind the Status Quo, it’s a big club and your not part of it.

  47. macman1519

    You cannot have world opinion believe that Trump is insane, and gold not go up. Personally, i think Putin is the puppet master, he’ s imprisoned people for leaking info to CIA, Trump has personally not said one word about the escalation of war in the Ukraine, but instead threatens war with Iran for firing one test missile. The magician at work. Watch this, not that other stuff that is way more important.
    Man, can hardly wait for that video of Trump with the hookers in Moscow to come out, and u know it will when Trump’s usefullnes to putin has been exhausted. The last remaining damage that can be given to the US by Putin, will be to release the video to totally embarrass Trump, but he wont be, but more importantly to embarrass the USA for being so stupid as to elect such an immoral, megolomanic moron. Tic, tic, tic………….

  48. dboz

    TIN FOIL hat again, huh? Relax. You are making it way worse than need be. Everything will be great again. Give it more than 2 weeks. The establishment and media and left are in complete meltdown mode as they no longer have any control. That’s all it is. Hysteria. If you thought a community organizer could run the world, surely a billionaire business man can.

    1. macman1519

      Dboz, in two weeks what positive has he achieved? Alienated Mexico, Germany, Japan, Australia, and those are our allies, but totally ignored buy not saying one word about russian escalated aggression in the Ukraine, removed laws that keep our streams and rivers clean, removed a law that protects the consumer, removed a law that now allows insane people can have a gun, so now Trump can buy one, The repeal of Obama care is now repair, wanted an investigation of voter fraud that does not exist, has lied repeatedly under the guise of alternative facts, has alienated muslims, thereby encouaging them into the arms of terrorists and made thevworld less safe. Yup hes been in office for only two weeks and look what he has done. Dboz i have respected your work concerning stocks, but your blind allegiance to a moron of epic proportions lessens your credibility greatly. How can i trust your perceptions when you wont see what is so evident to the rest of the world. Trumps best line at the prayer breakfast slipped past the media. Trump actually said, ” I will fix the world” Der feurher speaks. Whe the fk thinks they can fix the world??? An insane person, that is who. Have a nice weekend, it’s only going to get worse with Trump. Buy gold!!!It cant help but go up as long as Trump is in power.

      1. dboz

        How do you alienate muslims when BO has bombed them and ruined their countries, and you think telling them they may not get entry into our country may alienate them? You are a left ring extremist and only see the world through the eyes of MSNBC.

  49. bill

    I’m sure everyone saw that 10 year T close… its clear as day the Fed and the Gov want inflation…remember these are futures so three months form now prices will be up and up big…so June going into the summer months.

    Sticking with my Feb long call

  50. Robert

    Whats your opinions gents?

    Based on today’s close it seems that gold still has a chance to spike to the 1230 – 1250 level. If this happens I think the max that GDX will go to is 25. Notice that spike on GDX chart on Wed? Those are usually a tell of price target sometimes. So its possible that we may have 1 more push up to GDX 25 if today was not the top and then the correction starts.

    So how far down will miners go? If we look on the first bull cycle run at the beginning of last year, gold fell more than the miners on pullbacks. Gold might drop to 1180 or less and miners will have only like a 8% drop based on this history. So at 25 GDX, a fall to 23 could be the max on the pullback. The half cycle low drop in GDX last week was only about 3%. So since this next pullback will be a daily cycle low I think we should get at least 5-8%, hopefully a bit more but I wouldn’t press shorts too far for a short term trade.

    So to be conservative we can expect GDX to drop anywhere from 23 – 23.7 but hopefully we get lower like 22 to shake out all the late comers. I am hoping for GDX 22 or lower.

  53. macman1519

    How will this affect gold dboz, now ur boy has the whole EU against him, and still no word from der feurher on Russia. Buy gold!!!!

    French President attacks Trump’s comments on Europe
    Largest party in European parliament calls Trump’s likely pick for EU envoy “hostile”
    Valletta, Malta (CNN)EU leaders, led by French president Francois Hollande, have denounced recent attacks on Europe by Donald Trump as they met for a summit to debate the future of the union.

    Hollande described Trump’s statements as “unacceptable”, and German Chancellor Angela Merkel called on the EU to press ahead with its own plans whatever the US says.
    EU leaders have been rattled by Trump’s comments on Europe and the NATO transatlantic alliance. He has voiced his support for Britain’s departure from the EU, criticized European refugee policies and called NATO “obsolete”.
    Hollande hit out at Trump as he arrived at the informal summit on the future of the EU in Malta. “There are threats, there are challenges. What is at stake is the very future of the European Union,” he said.
    President of the European Union Jean-Claude Juncker, center left, and British Prime Minister Theresa May at the Malta summit.
    President of the European Union Jean-Claude Juncker, center left, and British Prime Minister Theresa May at the Malta summit.
    “It is unacceptable that there should be, through a number of statements by the US President, pressure on what Europe should be or what it should no longer be.”
    Merkel called on fellow EU leaders to unite, as she arrived for the summit in Valletta, Malta’s capital. “I already said that Europe has its destiny in its own hands. And I believe the stronger we state clearly how we define our role in the world, the better we can take care with our transatlantic relations,” she said.
    NIC ROBERTSON: Europe must come to terms with Trump’s hostility
    Austrian Chancellor Christian Kern criticized Trump’s ban on travel from seven Muslim-majority countries as “highly problematic.” He blamed some of the migration problems on US intervention in the Middle East. “There is no doubt that America shares responsibility for the refugee flows by the way how it intervened militarily,” he said, according to AFP.
    Concerns about Trump’s ‘decisions and attitudes’
    The concerns about Trump continued into the discussions. Malta’s Prime Minister Joseph Muscat said EU leaders expressed concern about some “decisions and attitudes” of the Trump administration during their deliberations at the summit.
    “Obviously there was concern among the EU 28 on some decisions that are being taken by the new US administration and some attitudes that are being adopted by the said administration. Nevertheless there was no sense of anti-Americanism. There was a sense that we need to engage with the United States just the same, but we need to show that we cannot stay silent where there are principles involved.”
    The President of the European Council, Donald Tusk, said protecting Europe’s “unique” relationship with the United States was still the “highest political priority” for not just the EU, but for all of Europe. Speaking at a press conference at the Malta summit, Tusk said that transatlantic cooperation “has until now been a key pillar of the free world.”
    His remarks were markedly more conciliatory than earlier int he week, when he called the Trump administration an “external threat to Europe.”
    Potential EU envoy ‘hostile’
    The criticism of Trump came after it was revealed that the European Parliament’s main political party is attempting to block Trump’s expected choice for US ambassador to the European Union.
    A letter from the Group of the European People’s Party, or EPP, urges the EU to reject US businessman Ted Malloch, calling him “hostile and malevolent” and accusing him of “denigrating the EU.”
    Ted Malloch, Trump's expected choice for EU envoy.
    Ted Malloch, Trump’s expected choice for EU envoy.
    “In these statements, the prospective nominee expressed his ambitions ‘to tame the bloc like he brought down the Soviet Union,’ eloquently supported dissolution of the European Union and explicitly bet on the demise of the common currency within months,” they say in the letter to the presidents of the European Council and European Commission.
    “We are strongly convinced that persons seeing as their mission to disrupt or dissolve the EU, should not be accredited as official representatives to the EU.”
    Opinion: Europe must come to terms with Trump’s hostility
    The letter ends by urging EU leaders Donald Tusk and Jean-Claude Juncker not to accept Malloch should he be Trump’s pick. Envoys to the EU must be approved by the European Council, the European Commission and signed off by EU leaders.

    1. dboz

      They are against him because he called them out. Not paying their fair share and ripping us off. New sheriff in town. They need us more than we need them. We saved their ass twice, we have they done for us?

  54. macman1519

    Guys, soetimes events happen that supercede charts, trends, fibs and all the analytical jargon anyone can come up with. Has Trump become the story? Has he destabilized thevworld and will continue to do more on this road to making everyone unsure of what the fk is going on. Is he a russian puppet, is he mentally unbalanced, is he being manipulared by Steve Bannon, a self professed Leninist, is he in a job he has no clue how to do, is he an immature, narcissist suffering borderline persoality disorder????? No one knows which apply, but here is the rub, all are suspected. When was the last leader of the free world held in such low esteem. He daily makes a mockery of years of US practice on the world stage under the guise of shaking things up. He isnt shaking, he’ destroying things. The world reaction to Trump is one of increasing disbelief, slowly evolving to dislike and and out and out hatred. That what Trump campained on, has brought to his presidency, as having the most divided citizenry since the Civil War, and is now expanding this hatred to Mexico, Germany, Australia, Japan, the arab and persian world, and now to the EU. In just two weeks. Dboz laughs it off and says to give him time?????? Well, markets are reacting, gold is reacting. The Fed says they will wait to see what Trump does next before acting. Everyone is in a state of disbelief, except for Russia. Russia loves it! As long as this state of affairs continues and continues to get worse, gold will continue to rise, dips will be shallow, and markets will be manipulated even more by the elite and their biggest supported der Feurher, Donald Trump.

    1. MegaMind

      macman1519, you hit the nerve,,,

      I was looking for the black swan event and looks like you found it…

      Its an 8 yeat event…

      Its trump presidency…

      If gold rallies… it will top in 2024…

      it could very well top at 5,000…

    2. Steve

      In the 5 stages of grief, you’re in the anger phase. There’s still bargaining, depression, and acceptance to come. Breathe deeply.

  56. Pedestrian

    I think Robert has made a good point up above. I have been noticing the same thing where miners are not as responsive to gold as normally expected. They sure are not selling off the way we might imagine if a large gold pullback was in the wings.

    And that’s the problem with technical analysis sometimes where we need to keep discussions of gold charts separate from discussions of miners otherwise its easy to be led astray when a correlation is not working as anticipated. Truth is when I examine mining indexes with various SMA and EMA variations they look really bullish.

    Especially out on the weekly levels.

    In the past two weeks the charts on miners have shown positive MA crossovers that can’t be ignored. But down at the short period trading levels where I spend my days its often less important because on those time frames you can still make money regardless of what the big picture trend is doing.

    I may have to concede that the guys who are betting long are going to be correct in spite of the indicators that say gold still has a leg down. I don’t want to discourage anyone here that’s for sure. Particularly because I don’t have much skin in the game on long positions since its not really my focus most days.

    Conclusion: mining stock may have turned the corner already and is more in step with the trend of rising equities than it is with gold itself. We may not see anything more than a minor corrective decline there as implied by the Bollingers but it is one that should probably be bought once it is complete.

    I still think gold will stall out here though and that should happen beginning in the coming week. If gold has indeed turned bullish though it is a warning that global equities are going to soften and perhaps that is coming sooner than later. The relationship between gold and stock markets looks to be inverse this time around (it is not always that way). So a correction in stock markets should be seen as bullish both metals and miners as well as bonds.

    But a bullish turn in gold won’t likely happen without a pullback in stock markets.

    I still contend that the dollar will rise WITH gold in this next phase but that bonds will also continue their move higher. So we will probably not see the usual sell off in this sector that has accompanied stock market declines in the past.

    All this really refers to is that the correlations we are accustomed too may be changing and gold (and miners) will probably perform better than expected based on years past when the first thing dumped to raise cash was metals positions. On the contrary, I think they will be bid.

    In short, I am bullish commodities and gold in spite of my persistent worries that gold has still failed to reach what I think is an important support line. As always, it is best to keep an open mind and be prepared to shift with the trend whatever it might be.

  57. Pedestrian

    For whoever it was that was going to short LABU the other day.

    Be glad you didn’t do that. Yesterday LABU finally broke out of its symmetrical triangle and should be on its way up again. I have been waiting for this quite awhile now but got so busy yesterday I completely missed when it turned bullish late day leaping 2 dollars and breaking out of the pattern. Still time though. Check the chart for yourselves. I think its a buy right here. Major upper resistance implies something in the 70 dollars area although how long it takes to get there is anyone’s guess.

  58. Pedestrian

    Just a last thought for the morning.

    If you are following a pattern and suddenly realize there is an error in the analysis or that your initial expectations are not going to be correct, do NOT be afraid to say so and change your position at the drop of a hat!!! We all want to be good. Hell, some of us want to be the best. But you cannot do it by holding to something you wrote last week or even yesterday. Markets change and we need to change too

    So what if people mock you online with comments like “But yesterday you said blah, blah blah and now you are flip-flopping so you don’t know what you are talking about”.

    My only answer to that is “so what”. I can change like the wind if I want. Talking about charts is a little like being a politician. Nobody expects your assurances or implied promises to be met. We all get to be wrong sometimes and one thing I can tell you is this….

    It never pays to be “right” and then lose money over stupid pride.

    It’s why I hate being pigeon-holed as Bull or Bear. There is just no profit taking sides when trading.

    1. dboz

      You have taken an inner look and appear to be better for it after some introspection. Sometimes it’s good to view the macro (as you just did) as you can get lost in the micro. Big picture says money into miners and gold, world is getting shaken, markets are showing negative divergence. Just look at the monster wedge on the Dow. If that does not scream bear, I don’t know what does. IMO they will use Trump as the excuse when they pull the plug. As macman points out, the setup for blame is perfect. They have to execute the plan quickly while the froth is boiling over and before he can change much. That will force him to handle the fires instead of implementing change to the establishment. See, we told you he was bad. Two birds at once. Take down conservatives and the market off the blame of one person. Populism is bad, trust us (establishment) we can make all this better. Capitalism will be the scapegoat. Just my macro view. Will see how it plays out.

      2. Pedestrian

        You could be absolutely right Boss. I have read a few others speculate that the inner sanctum elites would be prepared to take down the markets and put tremendous pressure on Trump forcing him into seeing things there way. That old expression “You can’t fight Wall Street” was not written as comedy. Donald against the whole world will probably never work for long. There are too many levers that can be pulled outside Washington and having a stock crash so early in the term would probably chasten him to know who is in charge behind the scenes.

        Not that I know or anything. Just speculation. But a stock crash would not surprise me one bit if it came this month and it came right out of the blue. I think we need to keep our minds open to all possibilities.

        There seems to be a power struggle behind the scenes and we little guys are just pawns in the battle.

  59. LiesandDamnLies

    PED

    Your starting to remind me of a friend I made at Uni in Canberra way back in 1974 called “Daws” he was from Victoria which played Aussie rules football. He had never seen a game of rugby league. I was from NSW and had never watched a game of Aussie rules.

    To cut a long story short there was a pissup for the rugby league grand final which Daws knew about. He cheered every team that took the lead. It was remarkable he always backed a winner.

    Your wobbling as much as Daws

    1. Pedestrian

      LOL! I guess one guys wobble is another guys winner.

      But look at it my way for a moment. When I go into my kitchen and turn on the faucet do you really think it matters to me if the water was delivered by a pump or it came to the house by gravity feed? In other words it does not matter if it was pushed uphill or fell off a cliff as long as I get the damned water in my cup!

      And that’s why I don’t take sides. It’s a distraction from the real objective.

      How else can you win at trading?

      1. LiesandDamnLies

        PED

        No wobble.
        I made a call over a week ago about the Chinese exchanges being off line. Predictions are good and have a few trading days to go. How is your 100% SLV going.

        If your a trader what got into your head to make a 100% prediction of anything to do with markets.

        Lies

        1. Pedestrian

          It’s OK to be wrong on any call you made. It’s also cool to be right. So congratulations if what you said came true. But on the days you are mistaken in front of a group of peers who are all anonymous anyway and you cannot swallow your pride and admit it, then how much harder must it be to do that with your own family and friends who know you in person?

          What is being achieved by pointing fingers and saying how smart you are and how stupid the other people are? Don’t you even realize that your handle is not your real name and its likely nobody really cares anyway?

          A week from now its all forgotten anyway.

          Hell, I don’t even know what you said because I am not interested in what the Chinese do on holidays.

          1. LiesandDamnLies

            PED

            You comment others posts. Don’t object when people comment on your posts. Your all over this website and I am not sure that you deserve the attention.

            Cheers Lies

          2. Pedestrian

            Cheers back to you, man.

            Sorry if I sounded defensive. It’s not intentional. I just think these kinds of sites work best as collaborative efforts. Too many other boards break down into recriminations, mocking, accusations and insults over minor calls and mistakes.

            Nobody ever wins.

            But good discussions in a group are fantastic for keeping your mind focused. A lot of people here have insights and say things I might have missed. That really helps keep me on track and its valuable to say the least. Especially when it helps me avoid an error.

            Maybe I will go back and look at that post of yours. I was really short time last week.

  62. Gary Post author

    This week was a classic example of why I don’t put too much weight on chart patterns. Last weekend we were told the charts were bearish because they had printed a reversal pattern.

    Well we know how well that worked out.

    Charts are my least favorite tool. Big money can paint the charts just about any way they want. I prefer cycles and sentiment as my first choice, and then charts as my third confirming tool.

    If it was as easy as having some charting software then every retail trader would be rich.

    There is a reason why the banks never lose money. They are the market or the most part.

    1. WallStreetJesus

      I think charts are a wonderful thing. You can look at the chart and tell where 90% of the people place their stops so you have a lot of liquidity in that area.

      The high frequency traders have access to the order book so they can see all the stop orders just setting there.

      Computers are a marvelous thing. They can instantly swoop down and pick the low hanging fruit for easy gains in micro seconds.

  63. Robert

    Ped that is some good insight. I am pretty sure the elite will try to find away to get rid of Trump and a stock market crash makes sense. The perfect weapon. However, I feel we are getting close to a world war more than ever. There is just too much things happening. All countries are seeming to be preparing for something big. Gary has said that he feels gold will just chop in a range for the next 2 yrs but I doubt that things won’t escalate big time whilst Trump is on power. Gold may surprise us 1 day soon by next year and go up $100 in a day

    1. WallStreetJesus

      Yes a $100 up day in gold maybe only be a “tweet” away.

      Trump is going to be good for the metals.

  64. Pedestrian

    The gold chart really troubles me some days.

    Silver is no different. In spite of very bullish weekly set ups the near term is still not giving me encouragement. For example, if I view silver on a weekly chart the 45 degree angle positive move since middle December looks just like a bear flag and nothing more.

    Actually on the daily chart it takes no effort to identify a parallel channel for the period consisting of the last month and a half although it does not look outwardly like a straight forward bear flag, but it still is. Gold is a little different with that little scoop on the tail end representing the latter half of January until now.

    But it too has the appearance of a triple top if nothing else.

    SLV meanwhile has tagged the 200 week moving average twice but just cannot get out its own way and break out even as it follows the 200 downward (check a 5 year chart to see what I mean). And GLD is faring no better even though it has previously broken out of its own 200 week but has since fallen back.

    So where are we now? Well SLV has been above the 100 day SMA for just a few days now and I don’t think it will hold. That is an overshoot and nothing more. And GLD has not reached that resistance level but also appears to have topped.

    I don’t know how anyone can consider long positions just yet. I sure won’t be doing it until I have some confirmation silver will stay aloft. I guess I will stick with my view that we have a corrective move down impending. Will it be Monday for sure?

    Who the hell really knows. I just think it is premature to make commitments the way the charts are setting up and the commercials in silver seem to agree. Why else would they still be so short that metal if they really believed it has a big surge coming this month?

    Silver weekly: That’s just a big old bear flag and nothing more on the chart.
    http://finviz.com/futures_charts.ashx?t=SI&p=w1

    1. WallStreetJesus

      Short term I agree with you and think the next move is down as well. I think the dollar is due for a bounce.

      The COT’s look pretty good for gold. However silver, platinum and palladium are at the point where you could possibly get one of those big overnight drops forcing futures traders to bail.

      Its like farming. The commercials sell (plant) and wait for the harvest. When things look the best right at the top of the move they begin the harvest. Silver, platinum and palladium are looking ripe for harvesting.

      1. Pedestrian

        That’s an excellent comparison, Gary. It sums up perfectly how I feel looking at those charts. Like harvest time is here and I am loathe to be part of the crop that’s about to get put in the grain bin.

    2. Gary Post author

      The correct strategy during the middle phase of an intermediate degree rally is to buy dips.

      Once the 5 day RSI reaches oversold that is one’s signal to buy.

  66. Pedestrian

    Just heard Avi say there are only 20% gold bulls right now. Seems kind of low given the RSI. Maybe he is using outdated information. Anyone here have the Sentiment Trader numbers? Just this past Thursday there was over 400 million pouring into GLD and call options went nuts. Someone has been buying like crazy given the volumes and that’s generally a good set-up for a take down.

  68. Goild

    Hey Ped,

    You are still thinking short?
    As I see it the odds are that next week is going to be a another good week for gold/miners.
    You would ask me why?
    Just consider this. Forget about TA.
    We had the week previous to last a red Candle, last week a taller and almost fully engolfing green candle.
    Consider that the candle formation is just right for an entry according to books.
    We have not seen yet a really strong movement. The scenario is just ripe for it to happen.
    The odds of a red candle next week are say 5%, a doji 25%, a green candle 70% I think.
    With the FOMC and Fridays report out of sight, gold has carte blanche to go up. It is leading to correct the election day unexpected drop. Friday also showed that the SM and gold up are compatible. I dumped my 5 NUGT lots on the red week. Now I need to get in again. First thing on Monday I will try to get two lots.
    So you can ponder things and have a take for this coming week: what would be the candle like?

    Gary,

    We do not have a dip here. The next dip for NUGT might be 1, 2, 3 dollars up.
    So I will try to get on board asap.

  69. macman1519

    Trump ha shown his insanity again, now he is calling Americans killers just like Putin, buy gold, gonna get worse and worse!!!! Read below

    Washington (CNN)President Donald Trump appeared to equate US actions with the authoritarian regime of Russian President Vladimir Putin in an interview released Saturday, saying, “There are a lot of killers. You think our country’s so innocent?”

    Trump made the remark during an interview with Fox News’ Bill O’Reilly, saying he respected his Russian counterpart.
    “But he’s a killer,” O’Reilly said to Trump.
    “There are a lot of killers. You think our country’s so innocent?” Trump replied.
    A clip of the exchange was released Saturday and the full interview is scheduled to air Sunday.
    It was an unusual assertion coming from the President of the United States. Trump himself, however, has made similar points before.
    “He’s running his country and at least he’s a leader, unlike what we have in this country,” Trump told MSNBC’s “Morning Joe” in December 2015.
    Source: CNN

    What’s next for US and Russia? 01:28
    He continued, “I think our country does plenty of killing also, Joe, so you know. There’s a lot of stupidity going on in the world right now, a lot of killing, a lot of stupidity,” Trump said.
    US Rep. Adam Schiff, a California Democrat who serves on the House Intelligence Committee, called Trump’s claim false.
    “This is the second time Trump has defended Putin against the charge that he’s a killer by saying in effect that the US is no better or different,” Schiff told CNN. “This is as inexplicably bizarre as it is untrue. Does he not see the damage he does with comments like that, and the gift he gives to Russian propaganda?”
    In the interview with O’Reilly, Trump noted that just because he respects someone “doesn’t mean I’m going to get along with them.”
    “He’s a leader of his country and I say it’s better to get along with Russia than not, and if Russia helps us in the fight against ISIS, which is a major fight, and Islamic terrorism all over the world, a major fight — that’s a good thing. Will I get along with them? I have no idea,” Trump said.
    Trump and Putin spoke on the phone last Saturday, and the two discussed cooperation in the fight against ISIS, among other areas.
    Voter fraud?
    O’Reilly also asked Trump whether criticism about comments he makes that he cannot back up with facts are valid. The Fox host brought up Trump’s claim that votes from 3 million undocumented immigrants helped Hillary Clinton get more votes in November.
    “Well, many people have come out and said I’m right. You know that,” Trump replied.
    “I know, but you’ve got to have data to back that up,” O’Reilly replied.
    “Let me just tell you, when you see illegals, people that are not citizens, and they’re on the registration rolls…” Trump said.
    “Look, Bill, we can be babies, but you take a look at the registration, you have illegals, you have dead people, you have this. It’s really a bad situation. It’s really bad.”

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