A recap on the markets and gold
Gary kicks off today standing by his call for a bounce in gold around the corner. Going along with his call he has some thoughts on why the bounce might be more powerful than most people think.
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+1 on preparing the shopping list of quality companies for bottom fishing. Cheers!
Emmm… Did you possibly mean » investments list « [both long & short – just got a copy of Livermore’s book – he said something to the effect that there’s no such thing as the long side or the short side….
… The only side is the ‘…right side…’
😉
The way I see it Gary and Doc are fairly far apart: Doc sees a drift lower for PM stocks and says to wait. Gary is looking (sounds like this week) for a bounce and it could be a good one. Neither think it is a good time to back up the truck. Doc sounds a bit more cautious. Guess we’re responsible for our own decisions….as it should be. I’m standing pat with about 20% in.
Good thoughts Silverdollar. I tend to see things more like Gary does, and mentioned on the weekend show that we may open up Mon & Tuesday with a PMs dip, due to a strengthening dollar. Part of the reason for the strengthening USD is due to some flight to safety out of Europe and China, but it will likely be short-lived. I expect to see the greenback start pulling back down toward the support at 94, and that should take the pressure off commodities and allow them to rise in August.
I’m like you though and only about 20% in the miners at this point. I would anticipate the pop to start earlier than Doc’s forecast of the 3rd week in August, but Doc is very accurate so I always consider his thoughts.
You are spot on Silverdollar that everyone is responsible for their own investment decisions and the results that they receive. The commentary that Doc, Gary, Rick, Chris, Al, Cory, and the the other commentators offer are just their opinions, so ultimately it comes down to developing your own plan, with your own time horizons, risk tolerance, and goals. That will be different for all of, but I wish everyone the best with their investment plan.
This Greek stock market opening into a decline is likely the primary reason why the US dollar is climbing higher today, as projected that it would on the weekend blog:
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Greek stock market bloodbath as exchange reopens
Greek stock market plunges by a fifth upon reopening, survey points to dramatic economic slump
http://finance.yahoo.com/news/greek-stock-market-bloodbath-exchange-112237193.html
I’m still looking to draft you for Pres. I haven’t found among the present clowns anyone I could vote for. Where do I send my donation?
funny.
What “bothers me” about the current narrative in gold is that many smart people expect a bounce and then a move to the lower lows.
Every smart guy – in my book – that I read expects this.
It seems that everyone one has this figured out properly. And this makes sense.
So typically, when things are figured out by many and they make sense… they don’t occur. This is what bothers me.
My 2cts.
LPG
Yep, I’m normally more comfortable being a contrarian than running with the herd, but when we started discussing an August bounce in PMs it wasn’t (and likely still isn’t) the mainstream viewpoint.
We are in a precarious situation with PMs down at these levels because they could break down below that falling wedge just as easily as bouncing. I’m playing it cautiously at present, and still holding most of the funds on the sideline waiting for the major bottom.
LPG – Best of luck to you sir!
GL to you as well Shad, and hope all’s well.
Best as always,
LPG
This was a great chart from 1907 Copper Bear as a analogy to where we are today in the Gold space from those articles Silverbug Dave posted on the weekend blog.
Very interesting as we definitely look like we are in that falling wedge in Phase III.> The bottom wouldn’t have to look this way though if, after trending gradually lower later this year or early 2016 , that we break to the upside out of the falling wedge.
This is why I am waiting for the final plunge in Gold to see if it will be breaking the trend line and a free fall like this chart (posted below), or if it will be more gradual, staying in the Falling Wedge pattern, and then finally breaking out to the upside to kick off the new Gold bull.
If the Falling Wedge pattern does break down below the trend line, then the bottom would fall out like that, and it could still happen in the next month or two.
However, it is more likely that we’ll just keep trading in the range with a bias to the downside into that falling wedge later this year or early 2016 as Doc has noted.
http://forum.rambus1.com/wp-content/uploads/2013/12/sc-154.png
At which point would gold be according to the chart?
In that Phase III on the graph after the triangle, and in that falling wedge pattern. My point was that while we absolutely could break down below the support in a waterfall decline down to the major bottom, that it was more probably that we’ll stay in the falling wedge pattern and eventually pop out to the upside, followed by a grinding whipsaw. I just thought that chart gave us a potential analogy for where we’ve been, and one of the 2 paths Gold could take next. Food for thought.
I agree that it will Not be a V-shaped recovery if we stay in the falling wedge and only head slightly lower through-out the balance of the year, but rather more of a U-shaped slow consolidating bottom that washes out the sentiment, but gives people time to take positions in the survivors that will excel in the climb back up into a new bull.
For clarification, if we did get a final capitulation like that 1907 copper chart at the end where it just nosedives, then the recover would be a bit quicker and more like a V-shape, but at this point we are just hovering back in that $1080-$1094 range without a real sense of direction. I’m hoping we get the August bounce to build up a little bullish momentum before the next leg down, but if we plunge…..so be it.
I agree LPG!
LPG:
That’s much more than 2cts. worth! Thanks for the thoughts.
I think Gary is correct saying the bounce should come soon ( even tho Doc thinks different. The herd is shorting right now, and the herd usually looses.
I hope the bounce is this week, so we can get on with the washout phase.
this week or early next week chartster.Technicals are still bearish for gold but they will soon change.Mark my words.
Don,
I agree.
Good thoughts Chartster & Don Corleone.
The COMEX could be in troubled times…?!
I think many people pontificating on metals are either naïve or setting up the retail investors. Pick your number 850, 700 ,500 250. There is a shortage of metals, supply and demand dictates that it should be going up. Also the miners are shutting down, what does that tell you? You still can’t get eagles right now, do you think that will improve much when the miners are mostly closed ?
Its just like all the other markets in the world right now, you don’t have to be smart to make tons of money, you can just manipulate your way to prosperity. Its been proven, there is no risk and no jail time for the manipulator’s.
Is the coming bounce in metals the physical run on the COMEX…?!
Is this the end of paper pricing, could phyz control price soon…?!
I think so.
The gold and silver markets are COMPLETELY BROKEN AND DONE.
there will be NO RECOVERY, period.
Not months and months. NONE.
first of all the so called retail investor buys gold when IT IS HIGH, NOT WHEN IT IS LOW.
the retail investor will not touch gold until there’s fathers fathers are dead and buried.
THE SO CALLED CHINA DEMAMD IS A MYTH.
THEY ARE SLOWING DOWN.
INDIA WILL WAIT.
we will stay in this NEW RANGE UNTIL IT GETS WACKED AGAIN.
this is the same old same old for four years now.
THERE IS NO CATALYST FOR HIGHER PRICES.
this sector is completely toast.
A stock. Armed crash will only make it worse for gold and silver
Oil is crashing, that will make it worse
It doesn’t even matter what the $ does.
What have I been saying all along?
The precious metals were dead.
The precious metals are dead.
They will be dead for a long long time.
Don’t try to compile a Christmas list
Just stay out of the sector at all costs
I imagine many have felt this way at the end of a nasty bear in any sector. One day the gold bear, too, will end. Those who know how to read charts and have their shoppìng list will do extremely well at that time.
James,
Stay focused for when the bottom is in. The faster it falls at the end, the fast the recovery and it means a small window to get in. This washout is meant to bewilder the gold bugs. The commercials will rush in once we hit bottom.
I buy gold on a continuous basis as a means of savings and investment,both.
The dollar will die,James will die. Gold will endure.
If there is a recovery, maybe even the “beach ball” effect takes place, there will be lots of opportunity to make money, the last bull went for how long?
I don’t see “a small window to get in” scenario, no need to panic.
I didn’t mean panic. I meant seize the day.
I understand Chartster, nice and profitable to buy at about an actual bottom.
After reading your post I have to think about trading my medals for fiat money. Maybe sell everything and get more fiat. Accumulate as much fiat as possible. There’s a shortage of fiat. Back up the truck. It has nowhere to go but up forever. To the moon. 10 -20 years from now fiat will be worth a lot more. I don’t care that they keep printing it, it has to be worth more. Besides there is a finite supply of the paper they print it on. No wait….. I mean the computers that digitally make it are somehow going away…… no wait that don’t sound right…. perhaps the electricity that makes the computers that make the digital money is going away because Obama is shutting down the coal miners too…. no wait…. he don’t like drillers either….. oh yeah… he does like to print money and give it to the something for nothing people and bail out big business.
Thinking is hard….. Maybe the thing to do is we should all be the something for nothing people. Its working so well, that maybe we should expand it!!!
Gregd now you are learning
You can’t spew the same old tired mantras “fiat is bad, gold will endure”
You need to think way out of the box
LOL
LOL is right. What would you prefer, James, a car or a receipt for a car? Yes, that’s an appropriate question. Fiat “money” got its start as a receipt for real money. The ONLY reason it is irredeemable now is that most people are completely ignorant of nearly every important fact governing their lives.
It seems like every gold forecaster is saying the same thing now. That gold will rally soon but it will fall to lower lows later in the year.
Yep, that was LPGs point up above….when everyone is coming to the same conclusion, the market often does just the opposite. It will be fascinating to watch over the next week or two for sure.
Someone said: When everyone is thinking the same thing….there is no thinking taking place! Paraphrased.
I Think you nailed it !!
Did Gare say gold NERDS?!? lol That’s what I have been calling them for a while now! lol Actually I call them PM nerds.
We call you Machine Gun Kelly…..the 3xLeveraged ETF nerd 🙂
I just became a 3x leverage nerd again as well. Hoping for an end of the day bounce with more pizzazz this time. Come on and bounce!
JNUG – 03:32:40
Bought shares @ $7.68
You’re brave than me, trying to catch end of the day bounces. I guess I’ve been 3xburned too many times.
What do you make of GDX testing last week’s lows, while GDXJ is still a few % up from last week’s lows?
GDX has actually gone down by a bit higher % than GDXJ in this down cycle. Does this mean it will move up a greater % in the next up-cycle? Or are juniors now favored over mid to large miners?
It is unusual the strength in the Jrs versus the Majors, but GDXJ also has some solid mid-tier and smaller producers in it that are so beat up that it is softening the downside momentum.
Well, it doesn’t look like it is going to be much of a bounce. It used be there’d be a $1-2 move at the end of the day, but now it was a $.10 move. Oh well, you gotta be in it to win it 🙂
In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value.
Alan Greenspan
Deficit spending is simply a scheme for the ‘hidden’ confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights.
Alan Greenspan
There are about three hundred economists in the world who are against gold, and they think that gold is a barbarous relic – and they might be right. Unfortunately, there are three billion inhabitants of the world who believe in gold.
Janos Fekete
PF
Last week I mentioned there is no rush to buy gold.
You are not going to miss out.
Gold is in a deep, long SECULAR bear market.
The trend is very clear.
Even if gold were to rally briefly, it will be met with selling.
It is just shorts covering.
You mentioned a price target of $5000
I asked where did you get that target from?
Who made it up?
If you really believe gold is going to $5000 one day then $200 either way makes absolutely no difference.
Sit tight and wait for a trend change and confirmation.
This is still my advice to you.
Actually it was Martin Armstrong who said gold was going to $5000.
“Gold should back off and retest the support… We should see gold at $5,000 by the end of 2015.” December 22, 2011
So much for him being a GURU.
It was Gary who said it would go to at least $5000 in the long-term.
Peter Schiff has also been talking about that number for the past several years.
Doc also said that gold would eventually get to $8000.
Rob McEwen also mentioned $5000.
Jim Sinclair $4000-5000
Egon von Greyerz $4500
In the long run aren’t we all dead?
Gold is a currency.It is,by all evidence,a premier currency.
No fiat currency,including the dollar,can match it.
Alan Greenspan
Oct.29,2014
Talking about 3 billion people –
Silver $15 bucks an ounce
Gyokuro green tea – $20 bucks an ounce
Just some food, er tea, for thought
Yes, James, and water is more than gas.
Silver would have to rise by more than 50 fold when priced in Dow not dollars to get back to its 1980 high. Which would you rather buy?
http://stockcharts.com/h-sc/ui?s=%24SILVER%3A%24INDU&p=M&yr=20&mn=11&dy=30&id=p02006327870&a=418802210
For those who can see that monthly chart, notice that the silver/Dow ratio fell in time to stop the 55 month ema from crossing the 233 month ema. However, if we use the much more widely followed 50 and 200 period moving averages, the silver/Dow ratio had its giant monthly “golden cross” more than 7 years ago and it is still good.
http://stockcharts.com/h-sc/ui?s=%24SILVER%3A%24INDU&p=M&yr=20&mn=11&dy=30&id=p73535731438
Actually, Avi Gilburt has (had) an interesting angle.
Below is an abstract from his July 29. article, posted last week in full by Agatha:
” […]
So, for now, I am going to be looking for a lower low within the next week or so, which would complete wave v of 3, which will then kick off a multi-week corrective rally for wave 4.
[…] ”
GL to all investing/trading.
LPG
Yes, I like Avi’s outlook and will just repost this thought from last week:
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On July 31, 2015 at 11:24 pm,
Shad says:
That makes sense to me that there would need a counter-trend relief rally to get bullishness going before the final leg down. Once people start getting bullish on the rising tide (likely in the miners/small producers first), then the last washout can occur cleansing sentiment, and then the long consolidation and gradual climb out starting a new bull market.
Avi Gilburt has been mentioning that in the Elliot wave count we just finished or will be finishing next week the end of the downward Wave 3. He also believes a counter-trend leg up in a Wave 4 could have some legs and improve sentiment, and then the Wave 5 would take Gold all the way down to it’s major bottom. It sounds like a similar thought process.
Bouncing up for an August Wave 4, and then declining down in the last major Wave 5 down would also allow the larger monthly falling wedge pattern to continue to play out. Gold would remain in that pattern and eventually dip down lower to put in its major lows before eventually breaking out to the upside. As Doc mentioned, that may take until 2016 if the pattern goes all the way out to the apex of that wedge, but it also could break out or decide to break down before that.
Lastly, a bounce up, proceeded by the final plunge down would also match up with the expected weakening US dollar, followed by a surging US dollar. Gold would rise on the weakening dollar, and then put in its major low on the Wave 5 down when the dollar strengthened. When this happens it should also mark the low in the CRB index and for the commodities sector.
This seems like the most likely path to me.
Having said that, there is no doubt that Gold has continued to flirt with $1080 support repeatedly and even dipped down below it into the high $1070′s a few times, it always could just fall out of bed down to the $1000-$1045 zone eveyone’s been watching for, and this would negate the falling wedge pattern and lead to a more severe breakout to the downside. Personally, it would be great to get the low over with, but that scenario would likely be more dramatic.
Wave 4 came and went at 1433. good luck.
It seems clear to me 3 billion people have spoken
When the majority agree on something, TAKE THE OTHER SIDE!!!
You mean the representatives of the bullion banks that control the paper price of gold for those that exert control through fiat currency are currently speaking.
Hyperinflation is always and will continue to be a currency event.
It is not a product of economic events, but more of a final loss in confidence in the currency.
A strong dollar equals no hyperinflation.
If the dollar holds .7200 USDX then there will be no hyperinflation, only standard inflation.
If the dollar breaks to .6200 there will be some hyperinflation.
If the dollar trades below .5200 there will be hyperinflation of the century.
Jim Sinclair
Matthew,
You don’t need to give me a class in that.
I LIVE BY COPPERING THE PUBLIC PLAY AT ALL TIMES and have said that on this site for years.
But when the majority need food and tea that’s trumps an industrial metal in a world that is slowing down fast and hard
You logic is faulty. When the public all agrees, all income levels are represented. Even those who have assets, like you, are extremely bearish right now.
Once again stocks come roaring back and everyone who thinks stocks are crashing are disappointed again.
THEY WILL NEVER LET THIS STOCK MARKET CRASH
Famous last words. Even if correct in nominal terms, it doesn’t mean stocks won’t crash in real terms (that is, measured in gold rather than promises).
If you believe in Jesus Christ, you believe the world we know will end. I apologize for upsetting you non-believers, but I have to defend Him because He is not here right now in the flesh. If you think that is bad, you should see what He wrote about gold and silver. Go Trump !!!
Frank you are opening up a can of worms.
I would love to here what he thinks of gold and silver
Can of worms is right. Tell him James. By the way….thanks again to you Al for finally seeing the light and ending the tribulations of Heavy hitter and his bizarre interpretation of biblical prophecy. I happen to love the bible and was really repulsed by what he was saying day in and day out.
A Listener, It must have been ready hard for you to skip over HH posts.
Gold is an alternative investment that is not in favor at the moment. This is true of many other quality companies that are trading at depressed levels. Over the past two years, I believe many investors have thrown the towel in and simply index their funds via. either mutual funds or sector ETFS. The problem here is that the “herd” is all positioning the same way, in the index. Money managers cannot invest in gold mining shares. They would almost be breaching their fiduciary duty. They need performance and they need to show that they are invested in rising share prices. That means they need to buy the Facebooks, Apples, and Amazons. That is the reason I said awhile back that the SPX needed to fail 2040 in order for gold to perform and if not weakness would persist. Now, as LPG states above, the gold community believes in a rally followed by a lower low. The problem with this thinking is that most are probably positioned for this scenario already. That is why it seems to fail.
I want to see gold slightly lower around 1050 to see if we get an upward response to correlate with the mining shares. Otherwise, with failure here, I would be looking for 945 to reassess. There is no doubt that the markets are representing a global slowdown and funds continue to rush toward index oriented funds that concentrate in a select few stocks. The last time I checked about 4 stocks represent about 20% of the SP index? Go figure, that is where the bubble is.
Crash in real terms, like against gold.
Matthew where have you been.
The Dow gold ratio is now like 17 to 1
So much for the 1 to 1 ratio the gold bugs keeping preaching
James, 17 to 1 is very high by historical standards. Where have YOU been. I am more bullish gold because this countertrend move has gone so far. YOU are the one that will tell people to buy gold as 1 to 1 approaches and I am selling. You simply don’t know what value looks like.
Did you know that, based on the Shiller PE, the Dow is currently at pre-crash 1929 levels?
Did you know that the Dow/gold ratio was just 5.8 before the crash of 1987?
Did you know that the Dow/gold ratio hasn’t even retraced 38.2% of its move down from 1999 to 2011? It would have to hit 20 and would be PERFECTLY NORMAL if it did so before resuming its downtrend.
Did you know that during the 1970s, the ratio plunged almost 90% before it had a big bounce? Or that he ratio nearly tripled during that bounce?
Did you know that we’re seeing the same pattern today? In 1999, the ratio was over 44 and by 2011 it had fallen nearly 90% to 5.8. We have also now had a bounce in which the ratio has roughly tripled (5.8×3=17.4).
http://www.sharelynx.com/chartsfixed/115yeardowgoldratio.gif
What the hell is happening with this site [ ‘scuse me… more specifically, this thread…] ?
For the last 30 minutes, the vast majority of my reading has consisted of nothing other than a compendium of platitudinous mantras, repeated and re-phrased ad nauseam.
What’s that tattered old stock market adage..?.. ”Sell in May & go away” ..?..
This being the 1st week of August, I may go down in the Guinness Book of World Records as being the tardiest on the planet to ”…go away…”, so I’ll be back in mid-September.
Must run now, the airport limo just pulled up.
Bye Bye all.
Gary has not noticed that the bounce which used to happen in gold and still happening in other market is no longer allowed. Gold has been in a theoretical perfect decline for the last two years. The decline is so perfect that it could be a textbook example. A natural market does not go this way.
Hope everyone had a good WE.
When we start referring to CNBC headlines… I tend to get “scared” 🙂 🙂 🙂
Keep in mind Richard/Doc/Charlie’s wise words from his interview today: prepare the shopping list – ie: have a plan.
GL to all investing/trading this week.
LPG