The Doctor Is In – Fri 9 May, 2014

Market Commentary from the Doctor

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Featuring:
Richard PostmaCory Fleck

Comments:
  1. On May 9, 2014 at 10:03 am,
    CDs says:

    The rise in the dollar had nothing to do with gold or silver. The apparent rise was due to the Euro drop because of ,s non-action.

  2. On May 9, 2014 at 10:06 am,
    CDs says:

    ,s should read. Draghi’s. My IPad thinking it knew better than me again!

  3. On May 9, 2014 at 10:08 am,
    original jj says:

    Hey Doc I just tossed up my weekly gold chart and to my eye this weeks close is bearish action and next weeks close better be $1310++ or the weekly indicators are rolling over….yet again! Silver looks very weak!

    David Morgan.lol…this guy has called sooooo many bottoms kn Silver these past few years oh Im sure he will get it right one day and will of course let us all know oc his correct bottom call

    • On May 9, 2014 at 10:39 am,
      seabhac says:

      yeah, the silver guru is never wrong. I know – for he told me so himself

    • On May 9, 2014 at 11:44 am,
      glenfidish says:

      Hi original, Just for the sake of knowing I have 4 gaps on HUI INDEX including your 212 gap. The other three that I see are lower. The 190.21 being the lowest. I will wait personally to at least have some covered before I enter. Gold 1180? possibly.. We shall see.

    • On May 9, 2014 at 1:51 pm,
      RICHARD says:

      You’re correct. The chart does not look good for silver in particular—-not yet indicative of a large sell off in either metal but a “grind down”—things better reverse next week or we may have a short term problem on our hands.

    • On May 10, 2014 at 8:28 am,
      cib says:

      this next little drop in silver is bottom…….its a head fake

  4. On May 9, 2014 at 10:12 am,
    J........the Long.............ootb says:

    New rule change for ENGLAND……..
    ….TAX AUTHORITY CAN NOW RAID BANK ACCOUNT WITHOUT COURT ORDER……………..is that like a BAIL IN……….

    • On May 9, 2014 at 10:14 am,
      J........the Long.............ootb says:

      People will be hiding their money in other places…………silver in tin cans will be safer than the banks…………….

      • On May 9, 2014 at 10:15 am,
        J........the Long.............ootb says:

        NO COUNTER PARTY RISK……………..

        • On May 9, 2014 at 10:54 am,
          franky says:

          THE NEW WORLD ORDER CORRUPTION RULES !!!!!!!! THE WORLD POPULATION DON’T KNOW WHAT”S COMING !

    • On May 9, 2014 at 1:40 pm,
      CDs says:

      This is not law yet. Trial balloon.

      • On May 9, 2014 at 1:47 pm,
        J........the Long.............ootb says:

        really wanted to see IF IRISH WAS AWAKE………….

        • On May 9, 2014 at 3:04 pm,
          Birdman says:

          The Irish never sleep Jerry. I know, I was married to one. A sweet lass from county Antrim. Almost ruined my sorry life but I loved her anyway.

  5. On May 9, 2014 at 10:18 am,
    pg says:

    Hey Doc – I am watching (In Canada) I AM Gold, Yamana and a bunch of silver companies and they look very enticing but discipline tells me that they will go lower into June-August time frame.

    • On May 9, 2014 at 10:36 am,
      original jj says:

      Agree pg I see the reason for bottom feeding perhaps….but there clearly is NO confirmation of a new uptrend unfolding like early Jan

    • On May 9, 2014 at 1:53 pm,
      RICHARD says:

      Yamana in particular looks like the next support is around $5.80-$6.00. I’ll probably take a run at it there if the charts look okay.

      • On May 9, 2014 at 2:20 pm,
        Pg says:

        I am with you.

  6. On May 9, 2014 at 10:19 am,
    original jj says:

    Doc last June saw an 80 pip drop in the HUI….as gold fell $200 and silver $4….what are you seeing that suggest this June will be bullish?

    • On May 9, 2014 at 1:56 pm,
      RICHARD says:

      I’m not necessarily seeing June as particularly bullish but we’re getting long in the tooth in this cycle when we hit June. I would like to see a May, June, and July like we saw in 2012—-of course, 2013 was a disaster—from the charts, it seems 2012 (or a semblance thereof) holds more promise then 2013.

  7. On May 9, 2014 at 10:42 am,
    pg says:

    You saw the dats o jj – here is an interest fact from the 1920′s – 1930′s

    Homestake mining (now Barrick Gold ), traded for $50/share in 1924 and paid a $5/share dividend and rallied to $100/share into Oct. 29 and dropped to $75 by 1931, but all the mining shares stopped dropping and rallied into bull rally into 1935 – DOW bottomed in June 1932 and Silver bottomed in Dec. 1932.

    We could be setting up for a similar event where by we will see a correction this summer in all markets and then everything rallies into 2015.75 or later and it will be during the correction from the late 2015-early 2016 (or later top in stock indexes) where we will see mining shares repeat their move from 1931-35.

    Watch Barrick and other major producers for signals.

    Regards,

    • On May 9, 2014 at 11:08 am,
      J........the Long.............ootb says:

      pg………..I agree with you 100%
      John Hathaway says…..”do not get hung up on the day to day moves of gold.”

  8. On May 9, 2014 at 10:44 am,
    pg says:

    One more note – Homestake rallied to $550/share and paid a $56/share dividend in 1935.

    • On May 9, 2014 at 10:54 am,
      original jj says:

      well as much as that historic data suggests fantastic % $$$ gains i try and keep reality in place….one resistance level overcome at a time….its how the bull ran from 2000..11

      • On May 9, 2014 at 11:24 am,
        PG says:

        What this data shows is that the best time to buy Ho9mestake was 1924 and hold till 1935 – look at all that happened between 1924-35, as Jessie Livermore said “Be Right and Sit Tight”.

        Doc – I agree this summer may present the best time to buy mining shares but we may have to wait a couple of years before THE MOVE comes.

        Regards,

        • On May 9, 2014 at 11:37 am,
          original jj says:

          well it all sounds good but Im very leary this time around governments of the world who will so tax rev starved that the set royalties towards the miners….time will tell

        • On May 9, 2014 at 1:59 pm,
          RICHARD says:

          I couldn’t agree more—-we may have a higher high in some of these stocks come this fall and then another consolidation. I don’t see these markets going nuts but a gradual increase higher over the next 3-5 years. I believe we’ll have to take positions and then be patient. However, I don’t really care if we increase our positions 100% and it takes 4-5 years.

    • On May 9, 2014 at 12:17 pm,
      Birdman says:

      PG, we all know why gold miners soared. It has been discussed here in detail already. I appreciate you keep mentioning it but please take more of the facts into account. Stocks soared because of US government and Fed policies that caused mining revenues to radically diverge from the rest of the economy. The government was buying all the gold that miners could produce at rates well in excess of production costs which incidentally went into decline during the depression. So that is a price to earnings story and not a “gold” story as you might imagine. To put it another way, mines were just a damn good buy because they became so profitable.

      • On May 9, 2014 at 12:24 pm,
        PG says:

        Thats my point the next deflationary collapse will produce the same outcome, study up a bit more…..”it is not different this time” you will see as everything that goes up must come down….for now watch it unfold

        • On May 9, 2014 at 1:15 pm,
          Birdman says:

          You will have to include assumptions that mirror the past to make that work the same way in the future PG. For example, do you believe that gold will once again be confiscated and do you also believe that prices will subsequently be fixed at a much higher rate than they were selling for in the free market beforehand? Do you even believe that the US will be able to control gold prices for the globe if China turns out to have a share of total supply verging on the many thousands of tonnes? There are a great many assumptions that must be made in order to give validity to the idea that a major US or Canadian gold mining company might see its share prices perform as did Homestake during the 1930′s. My point is simple…..history rhymes but it DOES NOT repeat exactly as before. Be careful in trying to project the past into the future.

          • On May 9, 2014 at 2:23 pm,
            Pg says:

            Birdman -not directed at you

            -ITS THE DEBT STUPID, this is aa debt crisis nothing more, nothing less, you can spin it however you like, TOO MUCH DEBT IN THE WORLD.

            Regards

          • On May 9, 2014 at 4:53 pm,
            Big Al says:

            Agree completely Pg!

          • On May 11, 2014 at 6:32 am,
            Birdman says:

            It is all relative to how much growth you get, PG.

  9. On May 9, 2014 at 11:41 am,
    glenfidish says:

    pg, sit tight strategy is not the best for everyone. There are always fluctuations far and in between. For some of us we need to pull money out to pay for daily, weekly, monthly expenses. If you have a big pile that does not need to be touched then your approach would be understandable. For many investor these past 2+ years has been tormenting. Some never sold and still have not sold on the way down. JMHO

  10. On May 9, 2014 at 11:50 am,
    PG says:

    I was not proposing a strategy but simply trying to point out that, we will get our bull market and regardless how you invest, there is a tremendous opportunity that was presented to us in 1999/2000.

    A bit more patience will be required. :)

    • On May 9, 2014 at 2:20 pm,
      Marc, San Diego says:

      PG,
      spot on.

  11. On May 9, 2014 at 12:07 pm,
    Birdman says:

    “That’s pretty amazing…the dollar just screamed up” ~~ Richard Postma
    ———-

    Come on Doc! This was way too easy. It was not amazing that the dollar rose. It was in fact entirely predictable and to prove my point I will refer you back to comments I made on this site over one month back telling you exactly where the Euro would get stopped out (at 1.40 precisely) and with added comments about where it would go next (down). By inference I was telling you about the dollar and in fact I made a number of comments specifically stating that we would see USD rise (not fall as most of you keep insisting). Now, I don’t expect you to throw the Bird a bone here or anything but I will ask you to take into account that the Euro decline now presents a hazard to gold. I think you are a terrific technical guy by the way. What I don’t think anyone here gets well is politics. The dollar MUST rise because that is (official) confirmation that serious inflation does not really exist. In fact though, we all know there is much more inflation than the records state. Several points higher in all probability and some report the real rate could be as high as 6% or better. So when we confront that fact against a backdrop of historically low interest rates the spread is actually fearsome. So you might wonder, why does that matter that the dollar MUST rise? And the answer to that question is the same one as why rates will be held below (real) inflation for a considerable period of time into the future. In a nutshell we cannot pay our debts and we sure as hell cannot afford the costs if interest rates rise too much. Look, these are all connected and intertwined. We need stealth inflation and we need it to carry on for a number of years or our problems will not be manageable. In order to achieve that it is expedient that the dollar not show too much weakness as that will signal deliberate devaluation. At the same time, inflation numbers cannot be acknowledged at their true rates and this is why we will get low core numbers even as energy and food rocket ahead off the public’s radar. Sp politics determine that the dollar look strong even if that means it has only strengthened relative to Euro weakness. This is why Mr Draghi will talk up interventions and QE exactly at the time our own QE is winding down. You have got to appreciate the beauty of this program. We get inflation even when “officially” very little exists and we get dollar strength despite an obvious devaluation. So USD goes buoyant. You owe me a Canada Dry Mister!

    • On May 9, 2014 at 2:03 pm,
      RICHARD says:

      Bird, the fat lady has not sung yet—-one week doesn’t make a trend. After we posted last time I believe the dollar dropped lower and I didn’t ask for my Canada Dry then ( but I may ask for it in the future.).

      • On May 9, 2014 at 2:20 pm,
        Birdman says:

        I will keep one on ice. Just in case. I do agree that the fat lady has not sung on metals yet. We don’t yet know for certain how gold will respond. What we do know for sure is that I was 100% correct that the dollar would rise versus a falling (policy induced) Euro. Try not to avoid the topic I wrote about above. You were wrong ;)

        • On May 9, 2014 at 2:29 pm,
          RICHARD says:

          Bird, you’re right—-we were due for a bounce at long term resistance for the Euro and long term support for the dollar. The important thing is if we’re now going to embark on a multi week move up for the dollar or will we stay in the trading range we’ve been in over the last few weeks and eventually take out long term support. Time will tell the story.

          • On May 9, 2014 at 2:34 pm,
            Birdman says:

            Thanks Doc.

      • On May 9, 2014 at 2:23 pm,
        Gary says:

        Based on the euro having 5-8 weeks down into it’s intermediate cycle low the dollar should rally for 5-8 weeks. The FOMC meeting is 6 weeks away FWIW. If stocks are down big into their yearly cycle low we could see Yellen abort the taper and restart QE. That would be the trigger for the dollar to seriously start down into it’s three year cycle low due to bottom later in the fall.

      • On May 9, 2014 at 2:27 pm,
        Pg says:

        Doc – I surprised that you would respond to birds comments, everyone on this planet knows that by the end of this decade- US dollar is done.

        • On May 9, 2014 at 2:31 pm,
          RICHARD says:

          Bird doesn’t want it to take that long before he travels to my house to share his best Canada Dry with me. Bird was talking about the next major move for the dollar and of course he could be right—-in the longer term, the odds are what you’re saying.

          • On May 9, 2014 at 2:38 pm,
            Birdman says:

            Doc is correct PG. The dollar is in for a whole lot of pain. We both agree on that. Just not quite yet. There is so much politics in the path before that happens that most people could probably go broke betting against the buck between here and there. That’s why I limit my bets to something I can actually afford….like a bottle of Canada Dry and not a kidney!

  12. On May 9, 2014 at 12:26 pm,
    PG says:

    Birdman – sounds like you get a lot of your understanding from Martin Armstrogs’ work ….imo

    • On May 9, 2014 at 1:05 pm,
      Birdman says:

      I read him infrequently PG. My analysis and viewpoints are entirely my own and rarely based directly on the work of another. For the most part I do not read the news nor follow popular thought. I will say though that some of what Armstrong has written has impressed me. In particular, his views on why capital flows will keep stock markets in the US buoyant is fascinating and I have come around to his way of thinking.

  13. On May 9, 2014 at 12:36 pm,
    glenfidish says:

    I just want to say thanks to all of you for your own contributions. Nice that I found this site and great source of knowledge I will add to my tools. Keep up the great work.

    • On May 9, 2014 at 1:03 pm,
      irishtony says:

      glenfidish…Welcome yes you did find a great site, lots of info, great guests & even better contributors….IMO

      • On May 9, 2014 at 1:14 pm,
        Big Al says:

        You bet Mr Irish, GREAT contributors!

  14. On May 9, 2014 at 12:53 pm,
    Dan, calgary says:

    I am not as confident as Doc is that this market is ready to start breaking out soon. I have some $ in an uranium explorer as sometimes they move separately from the PM stuff. The USD is looking too strong and silver is looking too weak IMHO.

    http://stockcharts.com/h-sc/ui?s=$GOLD:$SILVER

    This chart doesn’t seem to want to break down. A rising ratio is not good for anything but the dollar and conventional markets IMHO.

    • On May 9, 2014 at 2:34 pm,
      RICHARD says:

      Dan, if you have a chart close to you; I hope we have a gold situation for the months of May, June, and July like we did in 2012. History doesn’t always repeat but it certainly rhymes. The weekly charts right now are suggesting that possibility.

      • On May 9, 2014 at 2:50 pm,
        Dan, calgary says:

        Thanks Doc, I did look at those months and see a similarity. The G/S ratio chart is making new highs over the last several months but the RSI is a bit weaker overall.

        • On May 9, 2014 at 2:54 pm,
          RICHARD says:

          The weekly on the gold charts will tell us in the next 2-3 weeks whether we have a similar scenario as 2012. Currently, it certainly is not telling us we’ll see a 2013 type of year—-of course that could change and if it would, I would comment about that.

  15. On May 9, 2014 at 12:55 pm,
    PG says:

    Dan, I too have investments in Uranium stocks, take a look at the US Dollar in 2002-2008 and look at Uranium stocks. Strong dollar did not hurt sector.

    • On May 9, 2014 at 1:02 pm,
      Dan, calgary says:

      Cool. I just can’t live on hopium for the rest of my life. I need something other than G&S to study.

      BTW; thanks to all for the info and recent civility on this site. It is a fantastic site, AL and crew.

      • On May 9, 2014 at 1:06 pm,
        Dan, calgary says:

        U.to has an oversold RSI and is showing a bit of life today. I don’t own any at this moment but may put some lower risk capital into it IMHO.

      • On May 9, 2014 at 1:15 pm,
        Big Al says:

        Many thanks Dan!

  16. On May 9, 2014 at 1:17 pm,
    PG says:

    Dan – here is more than just hope for the Uranium sector, spot price is capitulating these last few weeks but look at Camceo, summer could present next great buying opportunity and I believe this sector could come to life later this year and into 2015. The fundamentals for this sector going forward are very good, like any other sector we follow, knowledge and timing.

    Patience will be required.

    • On May 9, 2014 at 1:24 pm,
      Dan, calgary says:

      PG, thanks for the info, that timeline is convenient if the real PM market starts rising in mid 2015 after a USD recovery. Rotate into Uranium then into the PMs next year may be a viable strategy IMHO.

  17. On May 9, 2014 at 1:39 pm,
    CDs says:

    What,s posting too fast?

    • On May 9, 2014 at 1:51 pm,
      J........the Long.............ootb says:

      do not worry about that…..it will post what you write….sometimes AL forgets to put his glasses on………..and can not speed read……………..joke………..

      • On May 9, 2014 at 2:10 pm,
        irishtony says:

        Jerry…Any truth in the rumour that AL wears wine coloured sunglasses when he is out playing golf ?

        • On May 9, 2014 at 2:24 pm,
          Birdman says:

          Those are glasses? I thought they were wine bottles!

        • On May 9, 2014 at 4:54 pm,
          Big Al says:

          Absolutely none, Mr Irish!

      • On May 9, 2014 at 5:08 pm,
        Big Al says:

        Speed read? What does that mean?

        • On May 10, 2014 at 8:34 am,
          J........the Long.............ootb says:

          it is like, skim reading thur an article,,,,,,kind of like skimming off the top, you know, like govt politicians do……………………

    • On May 9, 2014 at 5:09 pm,
      Big Al says:

      Common, that question coming from a chemistry professor?

  18. On May 9, 2014 at 2:09 pm,
    original jj says:

    Uranium back when Eric Sprott was nailing every sector he suggested as an early entry at $14 yellow cake he was calling for $100 based alot on his $150 oil call from the $40 level I rode that uranium bull back then and like gold yellow cake had many calling for $250 to $500 uranium….then 2008 happened

    FWIW…Fuckashima nuclear accident has created a very negative outlook towards the nuclear sector…yes we still need reactors or we will be in the dark but the sector lacks what is needed most Momentum!!!

    If your long a u308 stock place stop losses and reenter as the bull shows some strength or you may find that $2.00 stock will be undwewater for a very long period.

    Good Luck!

  19. On May 9, 2014 at 2:25 pm,
    Birdman says:

    Gary is choked the dollar went up. Maybe that’s why he is absent today.

    • On May 9, 2014 at 4:52 pm,
      Big Al says:

      Absent because he spent an hour with us earlier recording the upcoming Weekend Show.

      • On May 10, 2014 at 7:42 am,
        Birdman says:

        Just playing, Al. I assumed as much.

  20. On May 9, 2014 at 2:31 pm,
    Birdman says:

    Almost at 80 today, Gary!!!! Momentum buddy. More to come. This trade has life. Want to know why? The market sniffed out that Draghi is serious and intervention is virtually guaranteed. Look how European bonds responded. You think they want to lose that love in a day or a week? Not on your life. So this has legs now. It is not even close to June yet but the Euro is falling like a rock. Exactly as it should.

  21. On May 9, 2014 at 2:59 pm,
    Birdman says:

    My bet? Gold rises modestly Monday morning along its current flight path but plunges sharply below 1280 come Tuesday morning. That will be a gloomy day for this trade but I just don’t see how it can play out any other way right now. If gold does not respond to the Euro or dollar action that is current right now I will be very surprised.

  22. On May 9, 2014 at 4:43 pm,
    bb says:

    Just wanted to say, Bird, I remember your call on the dollar and euro.
    Impressive for a feather lover. Oh, and I know what you mean when you say “she destroys me but I love her anyway” (something like that) I might have run into her cousin.

    Would liked to have heard from Gary today tho.
    Thanks to everybody, special to Doc

    • On May 9, 2014 at 5:14 pm,
      Big Al says:

      Way in the past I probably ran into a lot of her cousins! (Way in the past being better than 40 years ago!)

      • On May 9, 2014 at 5:20 pm,
        Skeeta says:

        …”To be sure, to be sure”.

    • On May 11, 2014 at 6:28 am,
      Birdman says:

      Thanks b. Every once in a while I do get a good call. That was a beauty.