Sorry Moscow Frank, but Doc doesn’t share your opinion.
Click download link to listen on this device: Download Show
I hope you’re right, Frank—-the good news is that even if we trade down, gold is acting well and doesn’t look like it will plummet anytime soon. That should give some of the stocks a chance to begin putting in their lows soon rather then later.
I agree with you …..”gold is acting well”….., We have seen several months, that, when you come in on MONDAY…..there was a followup smack down, almost immediately. Will they let it run, then smack it down, who knows. As you mentioned silver is acting very well,,,considering we are up two days rather nicely, which is not typical. So, using that as a SIGN……I think things are changing….as Sinclair says….”silver is gold on steroids”…………………just my thinking………………CCF(contrarian’s contrarian frank)
INDY ON THE HOT SEAT………………….
NOT SO HOT SEAT TUES……….METALs are SMOKING…………
Good thoughts FFM CCF…..The BOOT…..OOTB…..The Long.
Yes, since “Silver is Gold on Steroids”….it will be interesting to see if Gold can keep climbing a bit longer, and then Silver may go into overdrive.
Gold is still rangebound under the recent $1157, and $1178 prior peaks, but if we got a close above $1157 then we could be in a longer counter-trend rally for the Precious Metals. Doc could be right that the gains may be capped still with a tendency to fall further later in the year. However, having said that, this move up in the miners is very encouraging and showing some real strength.
Some of the miners I hold like Yamana, Argonaut, Stillwater, Coeur, Sandstorm, etc… are up rather nicely from last week to this week. I’m getting nervous that the rally may not last long, so I’ll likely trim some of them back into the strength today. Overall though, very encouraging action.
last couple of weeks miners were very week when gold went up, Glencore was going down, miners are going up now after Glencore stopped it’s decline and rallied off it’s lows, watch out if it decides to go lower than where it hit last week
A lot is happening in Glencore………
Sinclair is right: Silver is surely gold on steroids; silver is down 70% while gold is down ‘only’ 41% from the highs!
Doc, 106 or 107 on the GLD; what’s that in spot gold?
silverbug dave:
It should be about $1,110. Basically, Thursday’s gold price before the move Friday & Monday.
All The Best,
JIM
FFM…you made the big time..headlines and all….don’t forget your pontoon fishing buddies…on a side note…The Gators are for real..let’s see what they do with LSU….
Gator……I told you they were looking good………I never forget a friend…..
As making the headlines, REALLY BIG SHOOW……OWL is going into syndication soon and needs a comedy skit………. 🙂
I’M FREE……..
that mean ……the BOTTOM IS IN…………………..
OWL AND I ……….are sworn to secrecy …….besides, if Gary, Rich, Doc, and Cory find out how much I am making, ,,,,the OWL will have to fly to Canada for the winter.
Something about being goosed……………
Talk about getting goosed………METALS ARE UP TODAY AGAIN…….Torture Tuesday for the shorts…………..
Several players seem to be relentlessly buying gold. Stock market up too.
These markets are saying QE4 is coming. QE4 could be the death nail in disguise.
ONE BUCK is down………..
followed by a ?
Gold seems pretty firm to me. I am betting on a reversal and strong close. Based on gold stocks and silver stong moves.
Would you say the samething if we were already in December ?
It seems that you always come with the “Tax season” argument …
Technically we have a divergence on the weekly, a triangle and the possibility
that we have finished the ending diagonal …
Just saying …
https://www.dropbox.com/s/qn15h9wu35rgaf1/XAU%20WEEKLY.jpg?dl=0
Gabriel, those are some interesting technicals—-here’s some of the technicals I’m wrestling with (there are others)—-the momentum indicators are showing absolutely no significant momentum to this small bump up and neither are the strength indicators. There are some others as well. I’m not saying that we might not “hang” up here for awhile longer then I anticipate but what I’m looking at currently is not screaming significantly higher at this time. Of course that could change.
We also have three lower lows on the ADX on the weekly …
So we can move sideways for a while and reverse.
Doc, the ptoblem I have with being short here is over 3.5Billion in short position has been taken in the last 2 weeks. All those positions are now underwater. Do the calculation yourself. That has NOT happened in over 3 years.
Be careful. My advice is buy some call protection.
great info…DAVE………..thanks.
Interested at the contrast in Gary and Doc’s thinking. Tough call but Silver is sure supporting Gary and it makes sense that Silver is out ahead given the extreme ratio.
ditto on the ratio
And the ratio continues to drop albeit slowly. In the past several weeks down from about 75-76 to 72-73
Several interesting articles on physical AG shortages on zero hedge this morning on how the mom and pop trading is way up worldwide and the recent premium growth increases on AG is nearly double AU premiums.
AG virtually almost unavailable in my area even with the higher premiums. Billions of mom and pops out there who can afford AG but few can afford even an ounce of AU.
Lot of stuff happening, which has not happened before….change is in the air…..OOTB
MORE QE……….and ZIRP…………
Another technical that should be an encouragement to the gold bulls at this time would be the beginnings of a “gentle” sweeping up of the 50 day MA.
yes. What is interesting is that you negatives are outweighing the positives in your eyes. I could understand that if Gold is sitting at a higher price with the path of least resistance and history saying it is going to fall again but it is sitting pretty low.
Doc:
I like your comments today. Possibly the miners can hold themselves at a higher level than in the recent past, even if gold does drift down. Let’s remember, many of them are so oversold, possibly anticipating gold to really fall out of bed and head to $1,000. With that becoming more and more unlikely as time passes, we have to assume there should be some early buyers of miners; willing to take a small downtrend in stride with the odds that they won’t visit recent lows again. By the way, were you in medicine?
Silver, yes; I was in medicine.
The general market is getting quite strong so that could hurt gold with money chasing stocks.
Who is going to tender their COSWF to SU for 6.80 a share (U.S.)? I will hold and hope that Imperial will make a higher bid. COP sold their COSWF to the Chinese years ago for about $37 a share if memory serves. Maybe COP will buy back their COSWF for 10 a share, or maybe the Chinese will make an offer for more COSWF.
Here’s another good technical in my favor—-the good old contrarian indicator what with all you guys putting all kinds of bruises on the good doctor with excellent thoughts and technicals. I do sense the same feelings a lot of you are.
The 50 day for oil has dropped to the 44 area and it looks like it is flattening now and should start turning up. Major oil stocks just went above their 50 day but not by a lot.
Just a comment about the conventional markets—-look at the dow; it’s currently right up against the 50 day MA and the upper BB. I’ll bet tomorrow we get a move down and then monkey around at these levels for awhile. Then late next week gets interesting. If this market slices through the 50 day MA and holds for awhile, the bulls have a chance in their argument that this was just a correction.
THEY need to keep it above 16,000………but, I bet you are correct.
Doc, Cory
When you guys use the words “my technicals” I really don’t understand what you are looking at because the charts i look at say BUY, BUY, BUY. Both in Gold Stocks and Gold.
Sound like you guys have a patent on “your technicals”. 🙂
Peter
I kind of agree with you Peter……………I think Aug was the low……….
The average house price in the suburbs (905 area) of Toronto has risen to an eye popping 733,000 as announced on the news today. Based on that bubble, stocks are looking more attractive with better long term upside. I can’t see how prices can keep going up. That 733K is probably 10 times the average family income. I think in the 70’s when I lived in Montreal the prices were about 3 times family income.
that 70’s price would be about correct,,,,,,they use to say……..2x your income….
just as a safe ratio ….2 x that is……could have stretched 3x in the later years , because of the higher interest rates.
Well, anyways………….$700k……is crazy…….
I hope the bubble pops so I have a chance to buy some investment property. Dent is forecasting huge drops in major cities in North America.
I bet some that are at $700k,,,are thinking there is still plenty of upside, with $1million on the table.
Yes the GTA is cray-cray Paul! Our sub 1,300 square foot attached house in central Toronto is worth between 820 & 870k right now….absolutely ridiculous! This reminds me of the Japanese bubble. I lived in Tokyo just as the zero interest rate environment was ushered in. I think this bubble will begin the slow grind down in about a year from now. Low interest rates combined with a low CND isn’t helping as it is stoking foreign demand and supporting speculation. Depending on housing speculation is NOT a sustainable way to run an economy. Part of me feels like there will be a major collapse soon, but the other part also wouldn’t be surprised if we add another %15 before the grind down begins in earnest. Is this a hyper inflation in tangible asset prices or what?
doc- thats what gary has said…
Hi Doc, Can I ask for your read on GDX. Im guessing that you are right on gold and Im thinking the regular market will move down at least a little bit here pretty soon. When that happens, Im thinking the miners will follow suit. Can I get your take on GDX? TIA
Doc Fan, I take my read on GDX off of the chart on GDXJ—-the two could separate somewhat but the chart on GDXJ shows it going very far in the near future as a limited possibility. The GDX chart shows more promise. Either way you could have some upside yet for both but they’re not ready to launch yet. It appears to be a tradable rally but not a long term hold yet unless you’re willing to see it back fill yet for awhile.
Thanks Doc.
Al,
With all due respect if there is one word that cannot be used to describe precious metals it is resilient.
They have been crushed for four years.
Anything that goes from $49 to $14 or $1900 to $110 is not resilient.
The precious metals have been crushed, captured and cornered.
It is all stocks, all the time as stocks are now and for the foreseeable future the safe haven play against zirp and QE to infinity.
Please stop calling gold and silver resilient.
When gold goes to 3K and silver to 100 you’ll find out that they are very resilient.
Well, James T L, true over the last 4 years but recent action in gold and silver has not been so bad, especially given the move of the US dollar index USDX frm 80 to 100 over the past year.
I mean the crashes in gold and silver were not really on great US dollar strength. Last year, gold was already down from $1900 to under $1300 and the USDX was still only about 80, up from the 2011 low around 72. Then late 2014 we had the 25% move in the USDX from 80 to 100 and gold lost only another $100-150 or so.
The bear market is stringing out nicely now. Unless it collapses again in price like some of the miners have then it may be a rounded bottom quite close to where we are now if we are lucky. So once you accept these lower price levels gold and silver have shown some resiliency in the last year I would say – but not in 2012-2013 of course!
I heard an interesting comment on a video recently about the general markets, that a subsequent downmove in general stocks might hit (a) the weakest stocks that could collapse again a second time and (b) the stongest stocks that haven’t really turned down yet. I think that may also applpy to the late stages of this gold bear market where the weaker stocks have cratered a second time rcently after some kind of weak consolidation in the past couple of years and strong stocks like Franco-Nevada started to break down too. Stocks in the middle and gold itself just continued in this slow grind sideways to down.
It was on CNBC’s Options Action, with Carter Worth.
http://www.cnbc.com/2015/10/05/this-is-a-new-opportunity-to-buy-gold-technician.html
This is a new opportunity to buy gold: Technician
CNBC-5 hours ago
“We’ve seen a long downtrend in gold and it looks to me that it could be coming to an end,” Carter Worth said Friday on CNBC’s “Options Action …
and on general stocks:
We’re in a bear market: Carter Worth
CNBC-29 Sep 2015
Link below.
We’re in a bear market: Carter Worth
CNBC-29 Sep 2015
http://www.cnbc.com/2015/09/29/we-are-in-a-bear-market-carter-worth.html
You also have to realize Janet Yellens boss Ben Bernanke spoke and in no uncertain terms told her don’t dare think of raising interest rates.
Let the party continue.
Buy buy buy!
I’ll have to say, Doc has been right on his GLD short so far. I’m surprised. I really thought that w/GDX’s rise today, that GLD would have risen too. Maybe the old tell of “GDX leads GLD” is no longer true. I won’t short GLD, but I am in cash. I think Doc has insights that I didn’t fully appreciate yet. I’ll spent more time listening to him.
Doc, what would you need to see to get bullish on GLD? GDX? For a swing trade, i.e. for several weeks or months. Thanks.
… besides TIME. Am looking for a TA setup that you would buy please. Thank you.
Bill, right now I would like to see a couple of weekly closes for GLD above 111. A weekly close above 116 would then be huge. That’s at today’s prices. A couple of weekly closes above 16 for gdx could allow it to run for some time. Then it’s pretty clear to 18. At that point I could give you some other thoughts.
GDX looks a lot more promising then GDXJ at this point as far as the technical charts. The next 2 days are going to be very important for GDX whether this is just a mere bump up.
Marty’s gold report has a low in gold at the end of November/beginning December with a final low most likely around the April, 2016 timeframe. The bankruptcy of Barrick Gold could be a catalyst for a low.
Short term….Marty’s gold arrays indicate gold heading lower this week and up next week.
The Parable of Milk and Baby Formula
—————————
Mohamed is a milk producer and his company is very large.
He is not just the most important milk producer in his country but he is also the biggest exporter in the world.
Mohamed also produces powdered milk baby-formula from his milk supply. But that market is quite competitive even though there are endless numbers of mothers to buy his product. It is because the market of suppliers is crowded and none of them can agree on pricing that is in the interests of everyone else.
Demand is high…..but supply can be made to be higher.
If he increases his production levels the price falls quickly and he moves a lot of milk.
If he drops production the price of formula rises but he gets fewer sales.
So Mohamed cannot grow his business even though he is the dominant player. He either sells a lot of milk products at a low price or he sells less milk products at a higher price but he cannot ever enjoy a time when both price and production are rising together.
So Mohamed devises a plan to eliminate the competition.
He will sell milk and milk products at a loss until the other guys cry uncle and bankrupt or they become targets for him to acquire. He figures it won’t take long because the marginal costs of this business means most will face angry lenders sooner rather than later. They will lose lines of credit and their ratings will drop.
Investors will abandon them and take overs will ensue as stock prices fall.
Pretty soon they won’t be in business at all as heavy debt gets called due to falling prices.
And in this scenario Mohamed wins big.
Because then he can keep production high even as prices start to rise because supply from all the other guys has been wiped out due to his competitive advantage and ability to drown high cost producers in their own costly lower-volumes of milk.
So Mohamed puts his plan into action.
He cranks up production to maximum in an effort to destroy the competition. But something funny happens along the way. Prices don’t fall in an orderly manner. Instead, they crash because cows are a funny kind of animal.
They DON’T stop producing milk just because of a price war!
So the milk keeps flowing. Every single day. In fact milk supply actually starts to rise as some producers bring new dairy animals on line to meet their revenue targets in a lower profit environment.
Supply explodes.
Prices take the elevator ride down (kind of like a Bungee jump to be honest).
In just one short year almost NOBODY is making a profit anymore. Even Mohamed is on the ropes and his country has started selling bonds to raise capital to make up for the shortfall in national income caused by the severe drop in baby formula income and profits.
To end the bleeding, all Mohamed needs to do is stop producing formula. Not by a lot either. He only needs to kill off a small fraction of his herd and send them to the abattoir to become steaks and pretty soon market prices will rebound to normal levels.
But he can’t do it. There is a problem at Headquarters and pride is in the way. The plan calls for increased production, not a retreat from the front lines of a supply war. And once plans are made they are difficult to alter since all the troops have already rehearsed the dance steps.
So price keeps crashing.
First by 10% then by 20%….30%….and 40%……..with no end to the declines in sight.
But the mothers are loving it! Some are even planning on having more children. With milk prices this low nobody even breast feeds anymore and needless to say but they all have extra money for other family expenses each month.
But they should be careful not to spend the theoretical profits.
Mohamed only needs to drop his formula production by two million liters a year and prices could double or treble overnight. Right now he produces 31 million liters annually but next year if that falls to 29 the marginal excess will be wiped away and milk will become quite dear again.
Just like it always was in a world where growing demand of populations almost always exceeds the available supply.
I am only talking about milk of course!
You guys knew that.
Several players seem to be relentlessly buying gold. Stock market up too.
These markets are saying QE4 is coming. QE4 could be the death nail in disguise.
The free chart on this site of the Dow 30 is almost exactly flat over 1 year, below the highs with a hump in price in between.
The silver 1yr chart looks a little better than gold especially on today’s upmove over $16 on Tuesday 6 October 2015 .
Reply to this comment
Good questions to Doc, Cory!
Really trying to put me on the spot…………..Indy