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A New Development for Gold: Now the Hedge Funds Are In

April 19, 2016

I have said for a while that if we want to see any sustained move in the metals we need large funds to start buying. We can see by the increased investment in EFTs such as GLD that big money has begun to invest some money in the sector. This article posted over at Gold-Eagle recaps what we have seen this year and the similarities from 2012. These are crucial buyers with large wallets that can support moves higher.

We all know that gold has seen a positive 2016. Even with the stock market performing well, it seems as though many money managers and bankers the world over are perfectly happy to invest in gold. We’ve seen that in the past months with Chinese central banks investing more in gold. But what if it’s not enough that central banks are buying up gold? What if you needed to see the hedge funds move in on gold before you made a decision?

Click here for the full article.

Discussion
92 Comments
    CFS
    Apr 19, 2016 19:50 AM

    Velcomen to the Vestern Vorld Veimar Republic.

    CFS
    Apr 19, 2016 19:53 AM

    In case you did not notice, the U.S. Dollar is about to fall seriously.

      Apr 19, 2016 19:03 AM

      it did get wacked………………94 …..

      Apr 19, 2016 19:29 AM

      SGE?

        CFS
        Apr 19, 2016 19:36 AM

        Shanghai Gold Exchange

          Apr 19, 2016 19:54 AM

          Yep I realise CFS SGE was in response to dollar getting whacked! Best, A

      Apr 19, 2016 19:40 PM

      dx has to go down further.Eur/usd target 1.2.Having said that from 10th march todate gold has fallen with the dx.Usually they are inversely correlated.That makes it very bearish for gold too.

    Apr 19, 2016 19:55 AM

    We posted the notice several days ago…….concerning the hedge funds……… πŸ™‚

    Apr 19, 2016 19:57 AM

    $17 silver on the way…………

    Apr 19, 2016 19:59 AM

    SOMEONE PUT OUT A NOTICE ON THE………………………….SGE………. πŸ™‚

    Apr 19, 2016 19:14 AM

    Meanwhile, in the LOL department…

    On April 16, 2016 at 2:30 am,
    Birdman says:

    “…I went short gold miners (and silver) several days back at what will likely prove to have been the exact top for the shares.

    The charts back me up too as do the technicals. Silvers run is finished. So has gold’s. Now only the crying remains for the bulls as their hard sought gains begin to evaporate…”

      Apr 19, 2016 19:15 AM

      Hope , he did not buy that DUST…………… πŸ™‚

        Apr 19, 2016 19:18 AM

        Jerry, I still hold a DUST position and I may even add to it soon.

          Apr 19, 2016 19:33 AM

          Stick to your guns birdman.You are on the money. There is a positive divergence on the macd and that alone speaks a thousand words birdman.Besides that all indicators are in oversold territory.I have my finger on the trigger ready to pull.Price is nearing my target i.e. the lower line of the andrew’s pitchfork at 1.8.Tommorrow is gonna be the day imho.

            Apr 19, 2016 19:41 AM

            You see oil declining tomorrow Don?

            Apr 19, 2016 19:31 PM

            Technicals look tremendously weak for oil birdman.Oil is about to decline birdman too.No asset will escape the grip of the deflationary pressure that is coming.Oil has dropped to 10.65 in dec of 1998.History doesn’t repeat itself, but it does rhyme πŸ™‚ Do not bet on higher prices in oil birdman.

            Apr 19, 2016 19:10 PM

            I was only wondering about your take for tomorrow. Not the next few years!

            Apr 19, 2016 19:29 PM

            I am not trading oil atm birdman.Every asset is a beast of its own but technicals look weak.This week or early next week oil is gonna plummet imho.

          Apr 19, 2016 19:35 AM

          BIRD………..just a note ….gary , says not to buy DUST for at least 4-5 yrs., but, then again his GURU STATUS is at 45%, that was in the reply section posted today.

            Apr 19, 2016 19:41 AM

            Right. He is not a guru in any case. That tag is given for the purpose of comedy. He approaches every trade with a certainty that defies explanation yet is only correct half the time of less as he exhorts followers to buy his picks. As far as I can tell he was really only good on his NASDAQ and gold calls.

      Apr 19, 2016 19:24 AM

      Matt, your technicals clearly won the battle here and I hope you and Birder can stop fighting as both your perspectives are valid…sometimes you are right but not always. I do think the shorts will have there day eventually, but hopefully at a much lesser retracement. $17.50 silver next.

        Apr 19, 2016 19:39 AM

        It’s not my fighting, Confused. Bird is despicable in his approach to differing with me and it is crystal clear that he, not I, brought back the attacks when he returned weeks ago.

        I am definitely not always right, but I have to point out that all the buying I did last year worked out extremely well even though it appeared to wrong for a long time.

        In addition to specific opportunities for everyone’s consideration, I pointed out three important things months ago that proved to be dead-on.

        -Focus on value

        -Focus on the weekly charts, not daily, and

        -Don’t sell too much because surprises will be to the upside!

        Birdman, frankly, has been worthless, as usual, but few seem to realize it.

          Apr 19, 2016 19:41 AM

          P.s. – Bird would be ruthless if I were the one that had been wrong today. He reaps what he sows, as he should.

          Apr 19, 2016 19:25 AM

          You are right BM can be a meany and I see your points. I still think he has some good things to bring to the table that’s all. Now let get back to making money.
          Good luck

            Apr 19, 2016 19:36 AM

            I have fantastic gains today, hope you do too.

        Apr 19, 2016 19:16 AM

        Homosexuality kills.

          b
          Apr 19, 2016 19:12 PM

          Where did that come from wayne?

            Apr 19, 2016 19:03 PM

            It came from Heaven.

      Apr 19, 2016 19:33 AM

      Matthew best to ignore BM outright. His comments about Africa are all that I can credit him with. He’s solely an attention-seeker, more so when he reverts to calling himself Birdman! Best, A

        Apr 19, 2016 19:44 AM

        You are absolutely right, Andrew, but his attacks on me and my calls are a bit more extreme than those he delivers to most others, and they are always inaccurate.

        Best to you, maybe I’ll learn…

          Apr 19, 2016 19:23 AM

          You are a promoter. All of them disgust me.

      Apr 19, 2016 19:56 AM

      One day of trading does not change my outlook whatsoever, Matthew. I took strategic positions for good reasons and have no intention to unload them even if they are early.

      If you feel confident about a directional change you will hold to that unless the market and technicals change but in the meantime a hedge is more than satisfactory to whether the existing trend.

      You should know that of course or you would never have held losing gold miner positions during the worst years in the belief that a turnaround would eventually come. Unless you trade like a butterfly and flit in and out like a twit you are generally better off holding once you have become certain that the trade will at some point go in your favour.

        Apr 19, 2016 19:21 AM

        Good time to sell some junk, premiums seem to be great.

    Apr 19, 2016 19:57 AM

    Matthew, Neither of us are can forget what he said to us in earlier posts. Besides he only lays into you because he knows you’re more than a match for him!!

      Apr 19, 2016 19:00 AM

      I don’ regret a word of what I said Andrew because my beliefs have not changed. I can accept you but as a rule have no respect for the clergy because of the perversions against Christianity so many have commit. Sorry, I won’t apologize about that.

    Apr 19, 2016 19:26 AM

    Gold and Silver are obviously entering new bull markets. Many will miss due to the negative Cots currently. They then try to read the charts with that negative bias as their backdrop and misread. The majority of gold and silver stock charts are clearly bullish if one knows anything about technical analysis. Yes, the Cots are negative. That means there will be a sharp but short correction [in time] along the way. Negative Cots in a bull market and negative Cots in a bear market need completely different interpretation. Read the charts without bias to reach the correct conclusion.

      Apr 19, 2016 19:51 AM

      +1 to each and every line of your comment.

      All known info is reflected in the chart.

      Apr 19, 2016 19:49 PM

      Nice post, Kent

    Apr 19, 2016 19:56 AM

    Gold has run into some resistance at the 55 month EMA today (currently about 1,253).

    http://schrts.co/ttRtYG

      Apr 19, 2016 19:31 AM

      So Matthew where do you think silver will go without getting any kind of pullback? Just trying to figure out where I can think about taking some profits and then repositioning myself.

        Apr 19, 2016 19:44 AM

        $18.50 seems like an easy minimum but if you’re talking about booking profits in your miners, I would look at each of their charts as well.

        I believe this move is just getting started. Here’s SLV (18 for it equals roughly 18.50 for silver):

        http://schrts.co/DoqypA

          Apr 19, 2016 19:56 AM

          I would agree with you.

            Apr 19, 2016 19:36 PM

            To tell you the truth, I look at resistance levels for profit-booking zones but I don’t generally use them as fixed targets. For bigger sales, I prefer to look for signs that the trend is weakening significantly before I act.

    Apr 19, 2016 19:07 AM

    On the topic of gold and miners, Martin Armstrong has written the following comments today:

    “There has been no breakout and there is major overhead resistance. Caution is now advisable. It is best to take profits…..” ~~ Martin Armstrong

    Gold Stocks: 7 Month High? — Armstrong Economics April 19, 2016
    https://www.armstrongeconomics.com/markets-by-sector/precious-metals/gold/gold-stocks-7-month-high/

    Apr 19, 2016 19:15 AM

    I said repeatedly that gold is still in a bearish trend as long as it does not rise above the 1307.64 level.I have been saying for quite awhile now that an expanding diagonal triangle(EDT) is forming.Atm we are in wave c of wave 4 of this EDT which could very well have a truncated v wave giving the overextended iii wave.Giving that this wave 4 has taken the shape of an expanding flat,wave c must be an impulse wave and it should not exceed the end of wave 2 at 1307.64.That is why I said many times that this is the mother of all bull traps because many analysts are taking this impulse wave as the start of a bull trend.Besides that gold is forming a rounding top and that is bearish for gold.A rounding top may forms at the end of an extended upward trend and often indicates a reversal in the long-term price movement.The commercial net shorts are at record levels.The 50 weekly ubb is turning down and the weekly rsi is nearing the overbought territory and macd and signal line are nearing a crossover(i.e. macd falling below the signal line) which is bearish too.Besides all this gold is still trending between 2 parallel lines on the weekly.One can draw the upper trendline from 1st oct 2012 to 7th march 2016 and the lower trendline from 26th sep touching 16th dec 2013 and see by himself what I am talking about.There is a great probability that we could see 750 by year end.A waterfall decline like we had in oil.

      Apr 19, 2016 19:22 AM

      Thanks Don. I would not want to speculate on 750 but in general agree that technicals favour a correction in gold and miners in the not so distant future.

      Apr 19, 2016 19:53 AM

      There is not a gut….in gold………..we have a gut in oil.

      Apr 19, 2016 19:00 PM

      Don
      Just wondering if you are currently trading tis gold market, or, just waiting for the predicted pullback of gold below 1050 (and maybe 750)
      Brian

        Apr 19, 2016 19:14 PM

        I do stock trading for living brian and I trade ups and downs.A swing trader but on a longer timeframe.I am interested in price trends and patterns and I careless what is the name of the stock.The trend is my friend being it to the upside or downside.My number one motto is not to marry to any position and not to trade on emotions.I am very objective in my views and when I see that the tide has shifted I will be the first to trade accordingly.

          Apr 19, 2016 19:08 PM

          Sounds good to me Don. I like your style brother!

          Apr 19, 2016 19:24 PM

          Good to know your strategy, I was just curious.

    Apr 19, 2016 19:54 AM

    Don,
    I completely agree re the weekly gold chart. I’m thinking gold and silver might just double bottom instead of seeing new lows. Silver is looking stronger than gold on the weekly chart.

    The banks, JNK and oil all…have more head fakes going on than Steph Curry. The junk bonds and banks, as well as oil are due for a smack down! Which should bring the stock exchange with them in a couple weeks. Things are getting close to a tipping point.

      Apr 19, 2016 19:58 AM

      ditto on the silver………

      Apr 19, 2016 19:20 PM

      If the pattern that I referred to( i.e. the expanding diagonal triangle) in my previous posts realizes itself ,we will see lower lows.That is a certainty and when I say that we could have a waterfall decline in gold, I really mean it.What happened to oil is gonna happen to gold.It is a question of time.

        Apr 19, 2016 19:51 PM

        It only makes sense to have one final flush to this bear market. There is still too many deadbeat miners. So, I agree.

        Apr 19, 2016 19:06 PM

        I hope you are correct Don. Listening to a few interviews tonight though and the bullishness on metals remains in the stratosphere. Almost nobody seems to believe that gold can correct from here. The excuses and rationalizations are all over the place.

        For example….gold and silver are *small* markets and can’t fall if serious money gets involved. Or this one…price is consolidating in time and recent bullishness is being worked off without any declines likely in the near future. After that its up and away so get busy buying now.

        Or another is that now the “smart money” has arrived its all blue sky’s ahead as gold finally finds its footing. Today’s latest bull incarnation is to attribute silvers sudden spike to the new Chinese price fix as if that really has any bearing on anything.

        But what almost nobody says is that things that rise eventually also correct.

        Nothing ever goes straight up or straight down. So did all the armchair analysts lose their heads all of a sudden such that gold will mysteriously only rise from here without even a pullback?

        Apparently these guys just forgot all about how normal markets work with regular ups and downs. But then…you know, now that the “manipulators” have finally lost control the prices of gold and silver will be returning to their real value! I think it was Andy Hoffman who made that assertion.

        Unbelievable. Truly amazing. Only in the gold world does this kind of logic pass the smell test and not get challenged by anyone! But here is a shocker for the bugs….even gold will experience the feelings of gravity again.

        Record Commercial short positions assure us that this market still has two dimensions.

          Apr 19, 2016 19:56 PM

          Be greedy when the others are fearful and fearful when the others are greedy and remember birdman good things comes to those who wait.It is all about timing when it comes to trading 3x leveraged etfs.My self assurance comes from the technical background that I have.If it was not for the technicals I would be gambling and not trading.Commercials are canny people and one thing I never do in trading is betting against them.

            Apr 20, 2016 20:32 AM

            So you have both missed this entire run up % wise so far then Don & Bird ?
            You are still in DUST & adding to it Bird ?
            There is a time to hedge…but I don’t think its right now.
            Cheers.

            Apr 20, 2016 20:10 AM

            Pay attention Skeeta! I have posted on this innumerable times already.

            I was in miners and NUGT since the December low when I told everyone here I had turned bullish and then I sold those at what I thought was the gold top some weeks back. It was not perfectly timed but so what?

            I have since strategically entered a DUST trade to try and catch some of the correction back down. I was a little early there. It has been a waiting game thus far but I still believe it will reward given time so no worries, mate.

            Just so you know I am no longer entirely in the gold bear camp. I play both sides of the trade if it looks like there is an opportunity. It is both normal and expected following a parabolic run like gold and silver have seen recently to see a strong retracement.

            I don’t know exactly when it will happen but am holding because the odds favour such a move. If G-d wills it then I will succeed with my choice of bets.

      Apr 19, 2016 19:46 PM

      I like the way they talk about “naked shorts”………..it seems there are a lot of people who do not know what is going on……

        Apr 19, 2016 19:48 PM

        “the exchange does not set the price , the market does”…………per the article , I guess the LONDON FIX is bs…….. πŸ™‚

          Apr 19, 2016 19:59 PM

          “the contracts are physically settled”………per the article………hummmm.

            Apr 19, 2016 19:13 PM

            OOTB,
            What the article says in it’s example was. The COMEX is primarily used by bullion buyers as a hedge for the physical delivery. Example: If a bank sells a ton to another bank, the do a put and a call for the same value. So when they sign the contract, the phyz is not paid for until it’s delivered. They hedge the bet on both sides so they have the same value from contract to delivery. There is no price setting or manipulation there. It’s just a hedging mechanism for phyz.
            Like I said, we live and learn…πŸ˜•

            Apr 19, 2016 19:15 PM

            The London ” Fix ” is another story.

            Apr 19, 2016 19:30 PM

            LOOKS LIKE A screwed up mess…………….to me……..

            Apr 19, 2016 19:36 PM

            It actually makes a lot of sense. I just never knew it was used primarily for that type of transactions. I’m still blown out by Not knowing it..
            Not many understand it’s true uses.

            Apr 19, 2016 19:32 PM

            Looks like a whole lot of GURUS…….do not know either……….. πŸ™‚

    Apr 19, 2016 19:51 PM

    Yes, I never looked at the use of the COMEX as a hedge for physical delivery. I thought it was more speculative trading. I guess we live and learn.