Comments on the breakouts in gold and the conventional markets
Doc joins us today to chat about the breakouts we are seeing in the markets and gold.
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Gary, some miners (eg EGO) up way over 50% from recent lows. Many juniors even higher. You have not mentioned sentiment in a while – could you share the sentiment reading for gold at this time? YOu were waiting for 40/50 to signal IC top. Also, congrats on your calls – definitely one of the very few analysts who’s calls have been right on.
The current sentiment in gold is at 29% bulls. Let me clarify that sentiment usually gets to 40-50% bulls and then turns back down…if the asset is still in a bear market. If the asset is in a bull market then sentiment goes much higher before the intermediate rally tops and begins a correction.
In a bull market sentiment often pushes to the 70 or even 80% bulls before a top.
So far gold is acting like a new bull market climbing a wall of worry rather than a bear market rally trying to turn everyone bullish quickly and generate the fuel for another leg down. That being the case then sentiment still has a long long way to go, and this initial rally off the final bear market low could go much further than anyone anticipates.
That’s why I want to catch this first daily cycle. That’s often where the really big gains are made, at the very beginning of a bull market, and at the very tail end during a bubble phase.
The reason the gains are so big is because the bear trains traders to only expect price to go down. So basically everyone is just expecting that gold is crying wolf again so no one is willing to buy. That leaves lots and lots of traders to eventually chase the move higher. And that produces that big move off the initial bottom.
God logic Gary. Another few days of this action and you may have me convinced. I think gold will reverse next week though but we will see.
I know, Gary! Yet, it may take them breaking through another resistance point before the Doc and others hop on board. By then they will be up by 70% from the lows.
Take a core position people! Then just add if they do trade sideways to down like Doc has been saying. This will be the mother of all bull markets.
Excellent advice. I think there will be an after Christmas sale on PM stocks; at least that is what I am waiting for to deploy my remaining funds.
Doc:
You still short gold?
If we don’t end lower by December I guess we can claim malpractice. J/K…We love you, Doc.
Tom, yes I am—-I shorted it through dzz and so there isn’t a lot of significant movement either way as a %—I’m slightly underwater and will hold unless I move down about 20% from my position.
Doc, how low do you think PVG could fall?
BB—about 5.
BB; I just looked at PVG and it had a big reversal day—It looks like it’s starting to roll over here especially on the daily charts. KDX has not shared in this rally at all and it could be because it had a rally earlier then a lot of the PM stocks. KDX is not going anywhere much based on some of the technicals. It could be this might be the first step up in the PM stocks and that when gold moves down in it’s next move, the PM stocks could also only to consolidate for the next move. We’ll see with time.
Thanks, Doc. I must remember to buy more@5.
Doc,
I try to do my analysis and then listen to what you have to say about the markets. I got to tell ya, man , I like it when I agree with you!
Thanks for all you do and have a great weekend!
Doc will be proofed right chartster.Mark my words.He shorted a bit early nevertheless he is still on the money.
Thanks guys—-maybe I’ll have to eat crow on this prognostication but the fat lady hasn’t sung yet. I believe this is a right translation on the intermediate cycle and still believe we’ll be lower then this price come December. Another piece of data to consider—-The commercial COT report this week. For the second week in a row the shorts dominated—silver came in with another net short of about 8000 contracts and gold came in with another net short of about 4500 contracts. Just some info to consider—even if we increase a little in a lot of these PM stocks, in most of them we’ll still be trading in monthly ranges—this move currently is nothing compared to the high prices in the last bull run for the stocks. There’s plenty of time to get on board and I’ll bet a lot of these price increases will have to come back for a double bottom. We’ll see.
Don’t worry, Doc. Even if you do have to eat crow. We are just starved for this bull to start. Most of us are down 90% from the highs in our resource stocks!! We just don’t want to miss out on the huge gains when this corrects.
Remember…Those who dispense advice and talk about their losses and gains are called Financial Advisors. Those who dispense advice and only talk about their gains are called liars.
Vix is spiking up. Now up 3.2%.
The rally is might be about to end soon as vix is climbing and oil is correcting again and may fall to 46 to 48.
Watson The IBM machine two years ago on Jeopardy proved that computers were smarter than humans, and now computers control the market. NAH! it couldn’t happen we humans are indispensable. Besides The Twilight zone was a fictional program from the 1950’s. Just joking HA! HA! DT
Ha, that’s funny DT.
This is where twilight zone meets Groundhog Day.
Thanks, Doc. I hope to buy more PVG@5.
I hate holding long. Takes too LONG to get me profits. I guess that’s why they call it long. Then I get out too early. I am gonna milk my gold and oil positions for all they are worth this time.
You know what they say Jason….dump the losers fast but be slow to sell the winners.
Back in 2000-2003, the $Hui took about 7 months to tag its 200 week moving average. Currently that MA is at 288. If this is truly the bottom, I expect we will get to that MA even quicker and probably surpass it by quite a bit before a major correction to let the 50 WMA catch up. I am in full agreement with Gary, this is going to be an incredible bull run in the miners. I caught lightning in a bottle in 2009-11 and let it slip away. I am going to try to catch it again and keep the lid on tight!
TA is good.
So we breakut the triangle …
The ADX is rolling over … soon we will have a “tongue alligator” 🙂
Momentum is up … above 50 moving average
and we may end this diagonal
I see “sharks” on the DMI………must be looking at the bottom, I can not see their “I”s
Lol.
Just saw red sharks and green flying fish.
Watch the 200 dma and 50 weekly ma ppl.Those 2 resistances are impenetrable like area 51.Reinforced concrete with electric fence followed by a machine gun bunker and a minefield and surveilled by drones.Move with caution.
Agree it will not be easy but I think that we have a new FUNDAMENTAL situation
following the TPP and what China and Russia will do now:
From A.MacLeod:
“China’s next move could well follow after this weekend, when the IMF and World Bank hold their annual meetings in Lima. It will be the IMF’s last chance to take a more constructive approach to China.
If the IMF fails to do so, we should expect China to step up her “tai chi” against America and her currency even more, in either of two ways.
She could temporarily withdraw entirely from key commodity markets, destroying the US shale-oil industry and inflicting enormous commodity-related losses on the western banking system. That might be too aggressive.
Alternatively, China could continue to dispose of the bulk of her remaining dollar reserves, cashing them in for commodities, and giving her embattled suppliers some breathing space. The latter restrained course would be more in keeping with securing her strategic objectives.
The sting will be the insistence that, in future, trade deals for raw materials will be conducted more often in yuan, once China’s dollar reserves have reduced to more modest levels. ”
TA is good but we have to read between the lines before going into area 51 :).
Doc, how does one buy or sell the VIX? Is there a stock symbol?
TVIX XIV
uvxy vxx xiv and tvix
Don is right—if you don’t want to be too aggressive go with VIXY; if you want to be more aggressive go with something like UVXY—-I tend to be conservative in my positions unless technicals scream about a position.
Is this just an enormous short squeeze in beaten down oil companies?
Silver up for the week……………
GOLD ABOVE…..1156.40………so, per someone I can not mention,,,,GOLD IS BULLISH.
$982…..PLATINUM is the winner of the day…….and week….Up $100 this week.
I might be stretching it here, but, is looking gooood…………..
M.Belkin………at KWN………
WARNS GOLD ABOUT TO BE unleashed…………
CAD at important resistance:
http://schrts.co/RDHGtq
I think that resistance will fail.
Monthly (the blue fork is based on monthly closes):
http://schrts.co/PSmvbb
GDM (Gold Miners Index):
http://schrts.co/jC9kBk
Earlier today I did take a position in GPL and then it spiked—unlike some of the PMs that haven’t moved much with this move, GPL was looking particularly good. It’s now banging its’ head up against resistance.
GLD:SLV ratio:
-every time it spikes through the 250 day ema, the ema becomes more significant.
-granted that the spikes are getting deeper
-the spike down this week went 6% below the ema
http://stockcharts.com/h-sc/ui?s=GLD%3ASLV&p=D&yr=2&mn=0&dy=0&id=p39476083704&a=410431976
Correction:
-not 6% but 2% spike below the 250 day ema
DOC:
On the 08/28/15 KER, you said you thought silver would hit $12.50-13.00 by October or November. Are your technicals still showing silver reaching these levels before the end of 2015? Also, with the possibility of both a PM decline & tax loss selling upcoming, does SLW @ $10.00 look achievable by late December? Thanks!
All The Best,
JIM
Miners up 30% from their recent lows. Things are looking good. I still think gold at least tests the 100 week moving average before the intermediate cycle tops.