Don’t be fooled by this jump in gold today
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chris…thanks for the link……
A dead cat bounce. The market is rocketing up and going loco. I have a big holding in loco and added more rig (transocean @ 7pe) the past few days.
I’ve done the opposite. I’ve been slowly selling my positions in loco these past few months. I think the loco market will head higher until October/November. After that who knows. It’s better to start dumping positions now than be a day too late, at least for me.
You could just trail a stop
That’s a good point Gary.
Chris, I do like the strategy of consistently taking profits so you are not too late and no longer have any gains.
Sometimes you take profits too soon. I got out of gopro and twitter and gave up another 100k gain in twitter if I had held longer.
I hear you, Paul. But I am starting to get that nervous feeling in my stomach. I trust my gut feeling. Anyhow, it’s been a great ride for me. Most of the stocks I bought in late 2009 early 2010. I’ve made a handsome profit. It’s enough for me.
I’m with you Paul. The markets will not be able to loco forever but right now they seem to have no serious headwind.
Stewart Thomson disagrees. http://www.321gold.com/editorials/thomson_s/thomson_s_082614.html
Somasundaram is one cool cookie Gil. And besides what’s the hurry: Savour gold’s rise like sipping an expensive claret!
Don’t get your message! Who is Somasundaram?
In that article you posted, Stewart Thomson stated:
“If anyone deserves the “man of the year” title, it’s probably WGC director P.R. Somasundaram. I’m in complete agreement with his superb assessment of the current gold market.”
Of! Course. I spaced. Was reading about him earlier today. Thanks.
The Indian managing Director of the World Gold Council
http://www.aajkikhabar.com/News/National/-Gold-likely-to-regain-sheen-in-second-half-of-2014-/772262.html
Gil, he’s the new guy in charge of India’s GWC. Sorry can’t google up attachment, A
Interesting article in the finance section of today’s WSJ. Not particularly bullish though!
Stewart Thomson has been saying the same thing for over a month. Eventually he will be right.
The key word here Aido is “eventually”!
True; however, Stewart does not change every time there is a reaction in gold. He has been very consistent.
Gil…thanks for the link…always good to hear encouraging metal news…..
Gold is still tracing out its pennant formation Gary. It should take another month and some days before terminating and finally breaking out one way or another. Between now and then the rises and falls in price should keep narrowing with the center price between 1290 and 1300 by my estimation. In the interim that makes gold neither a buy nor sell except for those trading the swings.
That makes total sense.
Thanks Gil. Now the really big question for early October is this……which way will gold break? Is it finally going to shoot up or will it disappoint and take another dive? I often watch the dollar most closely at such times but during October the broad markets themselves could play a larger role. Of course we are nearing the end of QE day by day and so it strikes me we are nearing a really interesting pivotal point for commodities, equities, metals, currencies and bonds. I do not think it a mere coincidence that so many resources are down during this timing band nor that markets are reaching new highs. My beliefs had been that there would be inversions in trends during August/September that would see some commodities bounce while the US equity markets corrected but that has not really played out thus far. The corrections were quite modest, nothing like I had anticipated. That leaves open the possibility of another taper-tantrum once QE is finally retired for good. Either that or the shorts will get squeezed stupid one more time and that will power up the indices again in spite of the Fed exits. It will be an interesting time no doubt but I cannot call it yet. What we do know is that gold will get decisive about its direction once this pennant completes but it is a coin toss today as to whether we get a wreck or a rocket. I would not want to be on the wrong side of the trade though. It could be an abrupt move.
I disagree; it won’t take a month for gold to make a move.
What makes you so sure.
Whether gold goes higher or lower, time is just about up. Note the six-point triangle (it is not a pennant):
http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&yr=1&mn=3&dy=0&id=p89002059267&a=365217243
Perhaps not. Most however are referring to this as a pennant so that will suffice as an acceptable definition to convey what is being discussed without getting too technical. Your green line expresses optimism. It assumes we will break out. Like I asked before….what makes you so sure? There are equally good chances we break down as the dollar is still strong and rising. Even if the dollar falls back in the next few days the trend remains up, not down.
If you click on it again you’ll see that I have added the “red” scenario should the breakout be to the downside. Yes, I do believe a bullish breakout is more likely, but I did not say that I am sure. Either way, a breakout won’t take a month.
OK. I see it now. Did you add that after I looked? Afraid I did not notice the red line first time around. Your termination point is the same as mine in any case. Early October at the latest so that is what I have my eye on although I certainly agree the break could come sooner. I don’t feel we will get a continuation past then though. It is either up or down resolutely. I think I will just wait for a decision by the market unless there is a good tipoff to trend before then.
Good discussion guys. No doubt we will have to breakout but it seems like the consensus is a breakout will not happen in the next couple weeks. A lot can happen over the next month… What will cause or drive the breakout (no matter which direction) will be of crucial.
Matthew….according to your chart we could see 1180 gold by the end of October which would create a triple bottom……and possibly signal a break to the upside……
Yes, but, all things considered, I think the odds favor a quick move to the $1268-$1257 area followed by a sharp reversal.
For what it’s worth, here’s a big picture look…
http://stockcharts.com/h-sc/ui?s=$GOLD&p=M&yr=15&mn=0&dy=0&id=p08072021124&a=362062180
The weekly picture shows more strength than weakness…
http://stockcharts.com/h-sc/ui?s=$GOLD&p=W&yr=1&mn=3&dy=0&id=p33399707640&a=361926967
As the tenacious GDXJ is telegraphing, the miners are not worried about a big plunge —in fact, just the opposite. After 8 weeks against arc resistance, big gains could come very quickly once we get a weekly close above it.
http://stockcharts.com/h-sc/ui?s=GDXJ&p=W&yr=3&mn=3&dy=0&id=p41657923021&a=359708986
I’m happy to make money in the stock market while gold goes nowhere. Up 12% in the last 3 weeks using leveraged funds out of the cycle bottom. Breakeven stop means no risk.
If you look at the bubble period during 1999-2000, the rise was parabolic. If you set stop and you feel you can win. However, there is still 40% chance that the stock moves lower immediately after you purchase it. You have to set a lower stop. Also you almost certainly be stopped out and pay commission and end up trading thousand of times. In a stop scenario, fill price for retail investors usually very low. It is expensive for small investors and only enrich the brokers.
I don’t think we are at the final stage of the bubble yet so we have to struggle with stop out for many months, maybe two years. But we have to keep in mind that we are participate in a musical chair game and nobody tells us when the music stops. So I sold my tech stocks early in the year and I don’t regret.
The price for hard asset is low and why don’t we have some patience and invest in asset which is lower. We know there have been a lot of monetory inflation and hard asset has never failed in a inflationary environment.
I like your take on investing Lawrence… Take your profits and don’t be sorry if you miss out on some further moves up. Then take that money and look for undervalued assets and be patient. We have already been through a tough time as precious metals investors and I feel now would be the wrong time to ditch the PMs and move meaningfully back into the stock market. That being said I am on the record as saying I think the PMs will not run way higher int he immediate short term.
Most of the “crew” down in Reno would agree with you, Cory
No need for leverage. With the right stocks I am up about the same.
“DON’T BE FOOLED BY THIS JUMP IN GOLD TODAY”
Thanks for reminding me!
Looks like we are going to have an outside day on gold anyway.
RIG is rocketing up – a turnaround. Up 3.2% now.
Lowest volume of the year takes S&P to record highs – are investors being set up for a sucker punch?
Almost certainly. “They” love to tease widely-followed indices such as the S&P up to, and then JUST OVER, “big fig” numbers such as…. yes!… S&P 2000. Recall they trick-boinked the NASDAQ to just over 5000 back in the Dot-Com-to-Dot-Bomb lunacy of 2000. They might do it again, but time is running out for that. I think the S&P over 2000 is the lynch-pin this time. Consider : in 2000 the headline “top” was the NASDAQ at just over 5000; in 2007 it was the Dow at just over 14,000. Who’s turn is it now? Yes… S&P… now just over 2000. Perfect “big fig” number from which to pull the plug on this Fantasy FairyTale.
Dang, can’t believe I did that! “Whose turn”, not “Who’s turn”. I’ve got to quit sniffing Elmer’s Glue before 7pm, that’s all there is to it.
Is that kind of like drinking wine before 7 p.m.?
Beer isn’t just for breakfast anymore Big Al.
Betcha it is the Nasdaq!
MAD ~ I was thinking “exactly” the same thing today. Although I owned some stock when NASDAQ hit 5000, I remember my broker encouraging me to buy more stocks and increase my position because it was going to 10,000. Unfortunately, I listened. ~ Brian
Ouch!
This is always historically a very low volume period every year. So that is nothing our of the ordinary. And I’ll say this: Traders never come back to their desks after the labor day holiday looking to fight the trend.
All the Fed has to do is keep the market trending up and then traders will take over next week and probably into the FOMC meeting. At the worst we may get a sideways consolidation for a week or two but that will be a buying opportunity.
This market isn’t going to top until the Nasdaq tests the all time highs. And the Fed absolutely isn’t going to allow any significant decline before they finish tapering QE. As Rick and Doc are fond of saying; you can take that one to the bank. 🙂
We had this discussion in Nevada while driving back from one of the Idaho North properties.
The double top you mentioned above will probably happen.
Yep, the Fed will want markets at record highs for when QE ends. By then the EU will probably have QEed. Nothing short of a Russian invasion of Ukraine will bring these markets down now IMPO – Gazza and Iraq are mere side-shows it seems.
why dont you stop this incompetent analyst from talking , in one yr, he did not get one direction in gold , he keep adding doubt in a difficult market with out any added value in his words . he does not consider gold in other currency, monetary base nor adeguate tecnical analisys . Find somebody that bring value
As I have said a million times Mr. Vanburen,
We listen to everyone!
Last I checked Anrea is either a Mizzzzzzz or Mrs. even if she used to be Andrew at one time. In our times, you have to consider all the options!
Not so fast, there, Gil. In typical French fashion, “Andrea” can be male or female. Example : the opera “Andrea Chénier” by Umberto Giordano.
http://en.wikipedia.org/wiki/Andrea_Ch%C3%A9nier
Chenier was absolutely “male”.
Yeah, I know. JUST when ‘ya think you’ve got EVERYTHING figured out, the French find SOME way to confuse ‘ya.
Hey give me a break Gil – I don’t do sex-change!
Big Al, that’s the thing I value most out of this site; listen to everyone! Market is not math; rather work like 14-day weather forecast. It’s hilarious to expect any analyst to be so accurate to what second what minute it will rain even with the best tools available at hands…. Gee… I read the absurd comment and I wish I didn’t… Franky’s comments seem more valuable than this.
Somebody holding a gun to your head and forcing you to listen, there, ‘Sparky?? Didn’t think so.
Meanwhile silver breaks out from it’s downtrend:
http://www.gold-eagle.com /sites/default/files/thomson082614-3.png
C’mon cheer yourselves up guys and gals (‘Andrea’ included). Give yourselves an instant KWN fix.
http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/8/26_Expect_Skyrocketing_Gold_As_China_%26_Russia_Continue_Buying.html
Why not Rev. A little KWN propaganda with breakfast never hurt anyone.
Or did it?
We’re up way before the rest BM!
We hear you loud and clear: https://www.youtube.com/watch?v=SHhrZgojY1Q