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Wednesday, September 29, 2010


"You can’t make big money, unless you think big money." Others have said it as well – you can’t achieve that which you can’t conceive. In the world of investments, if you can’t imagine something happening, like a stock or a commodity going up many times in value, then it is highly unlikely you would buy and hold such an item if it did, in fact, go up many times."  Izzy Friedman


  1. GARY,

    The pictures in last nights report WERE in the email. What I mean is that they email was almost 1meg in size and clearly had photos embedded within it.

    However, either you used a new program to compose the email or simply the email was corrupted before transmission and the pictures (which are attached to the end of text emails as per internet standards) were undecodable.

    Could have been as little as a single bit flipping due to random static in the air.

    Unless it happens again, just ignore. However, MINIMALLY you should reboot your computer just to clear and reload memory.

  2. Bit of interesting but not so useful info: on average, one bit per 1 gig of RAM will flip values (0->1 or 1->0) per month due to background gamma radiation from space.

    This is why servers and mission critical systems use ECC (error checking and correcting) memory.

    Consumer devices don't use it (it isn't viewed as cost effective since nobody cares if a house PC crashes). Since most of us have 1G or more RAM, we are easily susceptible over time to a bit flip. (Much less so years ago.)

    A bit could flip in your email program, the OS, a display driver, whatever. When weird stuff happens for no apparent reason, just reboot.

  3. Just an additional remark to your last article "GOLD RISING AGAINST ALL CURRENCIES":

    Shortterm view (since 2010-08-24). Gains in Gold in

    USD: +8%
    EUR: +0%
    CHF: -1%
    GBP: -5%
    JPY: -7%

    The maximum gain was on 2010-09-08 with + 2-5% in in all these currencies.

    My takeaway with this:
    -> since 2010-09-08 all gains in Gold are just a result of the USD-weakness
    -> so there's no bubble (even if it might look like one in USD)

  4. Gary you said in the report "I will eat my hat if it doesn't at least go to 5000".

    Do you wear a Mexican burrito on your head? :-)

  5. hiptwist (sounds painful...) - Yes .... in real terms (ie against most currencies and commodities) gold peaked over 3 months ago.

    I don't think, though, that that necessarily implies that the USD price won't continue to rise. But, as Gary says, probably after a dollar correction.

  6. As a member of the Council of Foreign Realtions (CFR), and working for one world government, I'm appalled that you folks won't just have faith and buy paper of all kinds. We must have you be "patriotic", as the illusion builds upon itself.

    We don't care about your sovereignty, but encourage you to. We create all sorts of paper for your consumption, so please AVOID tangible commodities, especially alternative currencies like the PM's! :)

  7. what just happened - that sharp drop on gold?

  8. Gold has been up 8 days in a row. A down day or two to consolidate wouldn't be a bad thing.

  9. Gold fell around the time the Chicago PMI number came out better than expected.

  10. Gary,
    an east coast rain-soak-er day here ( I know western US people don't know what that is, lol) with gold pausing now, would it be a good time to re-balance my portfolio? I have a some holdings that have not really taken off-- like ANO, RBY, FVITF and HMY.


  11. Tom,

    I am holding my RBY. I think the recent weakness is due to big Rob selling his shares to pave the way for Goldcorp to take them out. I expect by the end of this year we will get a nice premium for our shares.

    Looks like a little tree shaking this morning before the big move up!

  12. SLW is among the top list of buying on weakness. Happy for that :)

    On the other side, many S&P or russel ETFs are on the "selling on strenght" list.

  13. Thanks Jesse. I'll give them all another week or two. There's one whole quarter to go yet in the year plus we really are just getting ready to start this massive move.


  14. Gary

    will today be the daily cycle top?
    I just add my position at 1314 .so sad

  15. mayday,mayday ..... get outta dodge! the bucking bull is alive & well ;)

  16. HUI dipped under 500 briefly-- (ughhh)

  17. Sell leverage at 1300 and add back at 1314. bad move

  18. Perhaps the daily cycle low is still in front of us. I would imagine the reversal of sentiment will be quick. Most who ae bullish a skeptically so. All i hear is how expensive gold is, so a drop of 40 points or so, would likely result in "I told you so" commentary by media, and shorts would pile on. The dollar is due for a rally, too.

    But in the big picture, Gold and Silver are destined for much higher prices as the govt is in deep doo doo, and easy money is the only thing they have left to wipe their butts.

    I added appx 5% more to my position yesterday, but on a drop of 30 to 40 points followed by swing low this late in the daily cycle and I will be picking up more.


  19. Agree with you Fubsy--
    I still have some dry powder and will be tempted to pull the trigger on pullback! I expect the correction (if we actually get one) to be pretty brief in duration!

  20. I'm thinking that today is showing some fund liquidations that want to lock in their profits for the month. If so then it seems like a very reasonable pullback (unlike last quarter that saw close to a $50 one-day pullback). We'll see how it holds from here but I would think this is at least contributing to the weakness.

  21. I meant the funds are locking in profits for the quarter.

  22. BOW numbers continue to look good for the stock market intraday. let's see if they hold up after the close? For those few of us still interested in the Stock Market?

  23. Yeah, Daniel, some of us stock people still exist. I post only about stocks, in part because I have nothing useful to add on PM's above what Gary says. I have not been posting lately because everything is pretty neutral from my perspective. We had some seriously overbought readings but they have all worked off. If I had to, I'd buy rather than short, but I am very light right now outside of PM's and a few "toys" (minor positions to get my cookies off). The BoW #'s do look interesting.

  24. If that was a stock market mid-cycle low, this seems like a muted bounce so far. I'll be adding QLD this afternoon (apparently at only slightly lower prices than where I sold last Friday).

    I'm anticipating beginning of month strength, but my adds will be half positions in hopes of a bad initial reaction tomorrow morning.

    If that doesn't happen. I'll live with partial adds.

  25. GARY,

    Your discussions on RSI last night covered something I never said assuming you were addressing my recent comments. In fact, your comments actually agree with mine - while ignoring the argument I was making.

    I have never said RSI was a useful way to call a top in a Wave C. It is quite clear there are multiple overbought levels in major rallies.

    What I said was that at times of severe RSI readings (such as yesterday), a pullback of reasonable and not insignificant nature followed almost each and every one of them with high certainty.

    Nothing you said addresses that and in fact if you look closely at your main chart from the report (and also charts of SLW and GDX) you will see they *confirm* my statement and show declines of 5-15%, if not more. At most of the high RSI periods your circled.

    I just want people to be clear on my statements. I'm saying we are due for a pullback now and suggest it is already happening. Today appears to be the crack.

    I'll add, furthermore, that I do NOT expect a pullback to 'oversold' levels. Again I *AGREE* with you here. We will only pullback moderately. It will not be a smash or to some clearly easy buy point. But I suggest it will still be enough to warrant not buying yesterday or the day before.

    We will see. I'm doing the best I can and prepared to be wrong. I just don't want my comments misconstrued. I'm not trying to harm anyone on this board or panic them out of their positions. I will NOT be selling my current longs in any way. I'm only looking to increase more and trying to get the best point possible within the near future.

    I'll post, of course, when I suspect that is for whatever it is worth.

  26. TZX--
    Sounds like you cleared that up--
    Will look forward to hearing when you are close to pulling the trigger!

  27. For some idea, I'll mention my current thoughts on what such a short pullback might bring:

    1260 (+/- 10) would seem doable.
    1235 would be "buy it all"

    Hard call. Erratic as hell. Try to guage the buy point by looking at gold. If I had to pick a point: $21.25

    SLW: $24-24.50
    $22 would be a gift

  28. CORRECTION: $20.25 on silver. Not $21.25.

  29. Bob Hoye out again last night with another public post. (Note: he posts like this when is fairly confident in the outcomes he is predicting)


    He called 2008/9 crash like a genius. (Actually he called it like somebody who had put in a LOT of work and study and EARNED the result.) He hasn't done as well in the last 2-6 months, but I view his comments as quite good and dangerous to ignore.

    Again he is predicting "upside exhaustion" in silver (where day 5 out of a possible 6 days for the decline to begin was yesterday). His exhaustion stuff is probably close to my RSI comments.

    He is also saying the dollar is about to bounce. With this I agree as well. It has exhausting momo to the downside by my look.

    NOT reasons to sell longs. Just comments that MAY be useful to try and get good entry for additional positions.

  30. Goldera,
    Remember in bull markets timing mistake get corrected. Although as we head into the close it doesn't look like a timing mistake.

  31. It's been really quiet here today...

  32. Yeah-- I thought maybe the comment system was fried?

  33. This comment has been removed by the author.

  34. Finally, something I can post about: The Euro is sufficiently overdone to the upside that I will be buying euo (euro inverse etf) tomorrow. Perhaps this fits with Gary's dollar being due for at least a bounce. Can the euro and dollar both go down vs. everything else? Boy, I like the PMs more every day.

  35. Gary, i'm not sure what we are seeing is an half daily cycle low.

    Today it started to look to my indicators as a daily cycle low approaching, a cycle made of 25-27 market days.

    If that will prove correct, we should see about a week of declining price, and then a big bounce over the actual max.

  36. The daily cycle runs about 35 to 40 days and just about all of them lately have run the full amount before bottoming. At day 23 it's too early to have a full daily cycle low although we could still get a stretched half cycle if the dollar was to put in a bounce soon.

    I discussed what I thought might happen with the dollar in tonights report.

  37. Gary,

    What is your plan for the pending D wave later this Spring? Do you intend to just move to the sidelines or will you look to short gold in some fashion? Also, do you have suggestions for folks who hold junior stocks AND physical?


  38. I learned my lesson a long time ago. Never short a bull market. Haven't we seen enough surprises on the upside already?

    I will just go to cash and enjoy doing nothing for a couple of months.

  39. I noticed in 2008 we never got a weekly close above 515 on the HUI. The index tagged 520 back then but quickly reversed. This time 515 has been rebuffed so far, but a weekly close above it should be key.

    As far as buying on weakness during this recent run, it's been very tricky. I'm like TZX-trying to pick my spot to add some capital, but I just can't stomach buying at such high over sold readings. I do wish I would have listened to Gary early in the year and just taken a year off from watching my account. I had a juicy position in SLW and GDXJ. :( Oh well, live and learn. I do have a core position in the pms, but I want to load up for the rest of the C-wave and just forget about it.

    I did notice that many of these rocket ships FINALLY got a 20 DMA touch today (SLW and ANV) so that's good. I've also used a dialed up RSI reading (2) and watch it on the daily charts-once it gets oversold on a 2-3 day time period, that seems to be a good area to add.

    Can some of you give me examples of how you use leverage. As much as DOC likes to talk buying futures, I'm most likely not going that route.

    Great job this year Gary. I think you are a class act.

  40. I meant high over bought levels...It's hard to add in the nose bleed areas! :)

  41. Some juniors I'm looking at if anyone has any insight...I'm also looking at HL, SVM, SSRI, SLW for the additional core.


  42. JAWHAWK,

    A suggestion?

    Jeepers man, I've got one.
    Get a real broker that has canadian stocks directly and stop trading pink sheet crossovers. All you are doing is asking for a market maker to screw you over both directions on the trade.

    Might as well just throw your wallet out your window.

  43. From my view it is simple.

    Gold goes to 5000 easy. So a 3.8X. Silver is undervalued, and I will be kind, so say double. So 7.6 X.

    Silver miners will do at least twice silver, so say 15X. And I am being kind!

    Gold is an ass, it’s a jerk, it doesn't follow rules. The only way to make money is to buy and ride.

    Look boys, I am done, I am ready to rid a d-wave, h-wave, or whatever. I didn't come to this blog because of Gary. I came because he thought the same way I did and he had extra tools. Great tools, and he has done a great job BTW!

    In terms of what I am doing...simple drink beer as I am now, and let what we already know to happen actually happen.

    My only point, and I couldn’t care less about today. The US is doomed, the reserve currency of the world is doomed, and the competition to devaluation has begun. I don’t care who. I am done with trading. That is fine and done before with play. But not now…..not now, the freaking fundamentals are screaming, and there is no f-ing way I am going to lose my position.

    Anyways, boys and gals, from me, this is the last opportunity to add before things go nuts. Don’t use leverage btw. I am not a great timer, never pretended to be. Anyways my views. I locked in my 120% portfolio and I am not moving. I will not be punked out by simple yearly transactions, when the ultimate goal is so obvious! Either way I get to drink beer though…..freaking computer. Spend time with the computer or drink beer and have a good time with the family and make money………Look I know what I know, so I am done with the short term stuff. Win Win from my view.

    As always good luck to all traders(I have officially left your ranks)

  44. "....if you can’t imagine something happening, like a stock or a commodity going up many times in value..."

    I just thought that I might have given the wrong impression earlier with my posts on gold having peaked against most major currencies and commodities.

    I am in the same club as all of you who agree with Gary.... we're definitely in a long term gold sector bull market, and I look forward to substantial gains in the portfolio of juniors I have held now for 6 years.

    Gary, your knowledge of cycles and your overall view is refreshingly accurate, and I rate this blog highly!

  45. I am also glad to be in the club. I was disillusioned with the stock market and with trading.

    I knew gold was a good long term strategy and I prefer buy and hold to trading.

    But I needed someone to help me ride the gold bull when it tries to throw me off.

    Furthermore, many of the proponents of the gold market simply recommend... err gold! But I was more partial to silver as it was relatively undervalued.

    Gary's blog really fitted all these considerations.

    And by using things like cycles, Gary has helped improved my understanding of the markets. No one is perfect of course but cycles is better than no cycles.

    I said I was a Recovering Alcholic who needed to kick the trading habit. I think I have. Maybe I should call myself Recovered Alchoholic :-)

  46. Jay,
    Don't forget that any break out is going to occur at overbought levels. So to say that one can't buy because of overbought levewls is to say you can't buy a breakout.

    I've found the biggest favor one can do themselves in the middle of a C-wave thrust is to throw their oscillators away.


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