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Sunday, December 5, 2010


Not exactly a margarita but at least there isn't any snow. (I'll be working on the margarita's tonight)


  1. Looks pretty relaxing!
    Enjoy..you earned it!!

  2. New High in Silver tonight. I'm going to repost my comment from the last thread because I think its worht discussing....

    Anyone seen this from Zero Hedge?
    I know most of us are aware of JPM's short interest in PM's, and the potential fallout/stratospheric rise in Silver/Gold when they get squeezed.

    This video, as well as numerous high profile guests at KWN are presenting the move as imminent.

    The video also claims that SLV uses JPM as its clearinghouse. That sounds like a potential for counter party risk when the silver short blows up in JPM's face. They may not be able to meet their obligations. What happens to entities that are cleared through JPM if this occurs?

    Interesting times. I'm sensing a triple digit up day in gold. I also think it will be followed in the not too distant future by triple digit down days. I'd love to hear opinions regarding the risk of JPM's imbalances in the silver markets.



  3. looks like Gary is having a great time! I wish i could have went there to meet some of the turkeys but unfortunately i am still out of the country till later this month. Gary, will you plan something else early next year, like maybe after the C is over??

  4. fubsy that story is nothing new...i am surprised it took a cartoon for you to be aware of the silver shenanigans. I believe we will see much higher prices but like Gary said nothing goes straight up. I am sure JP Morgue will cover its shorts little at a time as not to create panic. If your old turkey then you dont have much to worry about...just buy silver and sit on it for a few years.

  5. You might be ready for low carb now!

  6. This comment has been removed by the author.

  7. Raz,
    This isn't the first I've seen of it. I've been following the JPM/Blythe Masters Silver short for several months. Its just interesting that the James Turk, Jim Rickards, Ben Davies, and Eric Sprotts of the world are sensing overwhelming interest in the physical markets driving the paper shorts to cover.

    I do think the cartoon is relevant, though as it highlights the magnitude of Masters derivatives bets, and the potential they have for creating a very messy situation in the financial community.

    With JPM leaning heavily short, and if the video is accurate that they would need three months to cover at todays volumes, all it will take is a catalyst to ignite the fireworks.

    What makes you think they will get out slowly if they are leveraged and losing? If Silver continues higher, JPM could be forced to cover. Its sactually a lovely bit of retribution if it occurs.

  8. ahh Gary

    reaping the rewards of your work!! Good for you!

    so what time do the markets open in Hawii?? 5.30 a.m.?? Close at noon?? If I was having a few Margaritas at night there, I would lighten up on my p.m. positions too, since sleeping in could get costly :)


  9. http://silvergoldsilver.com/ SOLD OUT

  10. Anyone know why the spread on SLV vs real silver has grown to 60 cents up from 30 earlier this year? This seems odd because the listed expense ratio is only .5%/year

  11. Is everybody onboard for the silver "bomb" protest on the 11th then? They are calling for everyone to buy 1 ounce of physical silver to crash JP Morgan. I'll do my part and grab a 100 ounce bar and see what it does in the days that follow. :)

  12. Seeing Gold steady and Silver up 2%makes me happy. 30 is a breath away. 33 to 35 is within reach before intermediate top at this rate.

  13. Looking buff, Savage.

    I don't see your lap-top? ;)

    Looks like new highs coming this month.

  14. I like the 6 packs...not bad... :-)
    Enjoy the break, well deserved!
    Sophia from freezing London

  15. GOSH .. It's Desparate Dan at the beach!
    Good condition for an old geezer....

    Must be the turkey philosophy - stops grey hair [and makes muscles...??]

  16. Hi Sophia .. it's magic up north here in Lancashire ... the trees are all white and lacey and the sky blue. Who needs Hawaii?!

  17. This comment has been removed by the author.

  18. hi John,

    will move up North then...London, no more snow, had it on Friday, beautiful parks, but now grey and cold....
    Have a great trading days guys!!

  19. This comment has been removed by the author.

  20. pre-mkt in U.S.

    Futures are down,
    gold is down,
    dollar up .77!,
    BUT gold stocks are up a bit pre-mkt (so far)


    NG up .20 = new high $15.12
    SLV up .43 = $29.12
    EXK up .11 = $6.98
    HL up .22 = $10.70
    SLW up .50 $39.80

  21. @alex-
    I guess slowly but surely dollar and euro are ceasing to be currencies while PM's are becoming primarily currencies.

    Plus ca change, plus c'est la meme chose.

  22. Remember what happened when last time dollar was up big and both silver and gold were up. Some things never change :-)

  23. JD

    The more that things change....the more they stay the same...

    (believe it or not, I only know what that meant because its in a song by the group RUSH) :)

  24. AND...there goes gold breasking above this mornings consolidation...and the dollar is starting to drop...

    HUI up 5.20 so far

  25. SVM is issuing new shares. After this kind of big run up it's not surprising to see, really. Watch out for more of this, it may help mark an intermediate top. No telling for sure, but it wouldn't be a shock.

  26. Good. We need more suckers on sinking ship to bring it down sooner.

  27. As Gary has said, watching the miners and AGQ march forward like this while under invested is difficult.

  28. Inspite of Gary's repeated warning about an impending intermediate top in Gold, I wonder why so many people are so bulled up.

    If gold can go up with dollar going up, gold can come down with dollar going down..

  29. @mlmt
    For sure. Changes in dxy don't have to reflect anything about gold's value. If Euro implodes, dollar is supported, but values of both vs. gold can decrease. On current trajectory, seems precisely where we're headed.

  30. @ Poly: Yup...sure is difficult...Just hope Gary is right about the intermediate top and then another huge leg up similar to the July - current run!

    Gary, enjoy your vacation!

  31. M,
    Trying to pick a top in a strongly trending market simply because it's overbought is a wonderful way to go broke.

    just wait till we see a topping sign. Ussally an exhaustion move. We would still have a bounce out of the next daily cycle low so even then one doesn't have to time the top exactly as we will get a second chance, and it often makes marginal new highs before finally rolling over into the intermedite correction.

    Alright I'm off to explore beautiful MAUI.

  32. Gary,


    Where's the mullet?!

  33. SoS numbers on GLD prior to significant tops:

    10/14/10 -12.5
    6/17,23, and 24 - could not find any
    6/7/10 -37
    5/12/10 -127.5
    5/11/10 -60.4
    5/6/10 -24
    1/11/10 -26.5
    1/6/10 -69.6
    12/2/9 -26
    12/1/9 -99
    2/11/9 -18
    12/17/8 -38
    12/11/8 -18
    3/5/8 -18
    2/29/8 -9
    2/21/8 -10

    Not all tops had SoS on GLD, but many did. However, the high SoS numbers sometimes came in several days prior to the top. So I'm thinking a high SoS number may serve as a warning--or even a confirmation--if it lines up with what we're expecting due to cycle analysis.

  34. I may do a little research on BoW at gold bottoms, or if someone else wants to do that, be my guest.

    I used the WSJ SoS page and clicked on the history button to get historical numbers. Their numbers go back only a few years, so it's hard to get a statistically significant sample. But the SoS numbers looked like a pattern, at least to me.

  35. Thanks Pima,

    How often did you witness SoS without a giold top, or did you not look for it?

    If you're only looking at gold tops and searching for SoS you might find that SoS of similar size may be far more common.

  36. Silver turns 30 today, happy birthday!

  37. Poly,

    I did not do that kind of research (finding SoS numbers on GLD when no significant top occurred say within a week or so after the SoS), as that would have taken many hours. You would need to go back in time, one day at a time and look for GLD on the SoS page. Very tedious.

    Maybe there is a faster way to do this? For example, if the WSJ page has a filter where you could enter GLD and it would display dates where GLD had an SoS amount and what that amount was, then you could do this kind of research in a reasonable amount of time. If they had an amount filter (show me only amounts that are greater than some number. e.g.), that would be even better.

  38. Thanks for doing the legwork, Pima.

  39. Days like today it's hard to sit on your hands. I am sad I have already taken a big piece of my position off and yet not so sure I shouldn't take a little more off now at the higher price. Needing Discpline SUCKS! But hopefully it pays.

  40. Yeah I hear you Pima, working with that WSJ page is not easy. I personally wouldn't bother with it, but believe if you could draw any conclusions from the data you have to know every instance of GLD SoS days and corresponding gold movement, not the other way around. As you state, that would take a while.

    Thanks for sharing.

  41. RQ,
    all depend on $USD?? where $USD heading next couple of days??

  42. oa,
    $USD up today. Gold up today. Market has a way of trying to confuse. I tend to agree with you but the market always tries to confuse. My best guess is that this is a dead cat bounce on the dollar but if I knew for sure I would be on the beach drinking Gatorade like Gary full time.

  43. Gary,

    Thanks for the amazing post over the weekend. Its coming.. It is here... low volume retest of the highs.. the retest may create lower highs or higher highs.. that is not a given... You warned us all in the weekend post.

  44. Did we just see an exhaustion move in silver or just some resistance at the $30 level that it needs time to break through? Thoughts?

  45. Possibly just some resistance at $30 level AND taking out lows of the day for the cash market (lows since 9:30am ET)

  46. I haven't seen anything that suggests large postions coming off. When they do, we will have a volume spike that tricks retail investors into believing the gold trade is on and they will pile in allowing big money to dump. Nothing like that yet.

  47. Fubsy,

    IF (I am not saying this is... I am merely saying IF) this is a retest of the highs (as far as gold is concerned), it WILL be a low volume retest.. retests of the highs are usually low volume. If highs get tested on high volume, those highs do not hold.

  48. fubsy/MLMT

    Stop looking at gold. Look at the dollar today. It hasn't been able to get back above 80, and if it can't do that then it's heading back down.

  49. Bede,

    Go back last 5 years. Almost every key level on most US indices (SPX, NDX, Nasdaq, USD etc etc) has mostly been gapped over or gapped under. Rarely do they breach the level (be it to the upside or downside) during regular trading hours.

  50. Fubsy,
    jp morgue would have just covered their position much earlier if it was possible to get their stops run over. With unlimited backing from the government they can close their position bit by bit and take advantage of sell offs to make up some of the losses. They will not cover when the price goes up but rather wait for a sharp pull back then unload positions. This way you have a somewhat orderly retreat.

  51. @MLMT
    A low volume test of highs would not get me to change my positions so its a non event unless we make a swing high on the weekly in which case i will lighten up on some of my positions. Otherwise, I'm looking to sell into strength aka Jesse livermore :)

  52. Raz
    Not buying it. I think Blythe is feeling the heat. They are choking on their shorts right now. Its all about performance, and they are getting killed in the metals. They did not foresee this kind of strength in the physical market and are going to be run over unless they cover into intermediate drops which will serve to minimize those drops. I think we are going to see the strength of this bull unfurl over the next couple months. But hey, like anyone else, I'm often wrong.

  53. looks like Garys target for silver will be reached before gold even makes new high. Looking for $33 as a new target now

  54. Did Gary have a specific target for silver. All I remember was him saying hypothetically IF it went to $31...what was his target?


  55. Gary,

    Given the time difference and the beach :-) what time do you think tonight's report will be out?

  56. hi everyone,

    I signed up for Twitter so I can get updates from Gary. I am not sure how it works. Is it possible to get an email notification from Twitter when Gary sends a message?


  57. gary,
    look at 5 yrs chart, why cde are lagging others?

  58. did anyone hear Docs call??

    Rumor hass it he says Gold was on day 12 from Nov 15 and could run for 2 wks....or....break a new high and fail ,turning into nxt intermediate low.

    since gold / silver are higher with dollar HIGHER , seems like dollar will go to 78 later and gold will keep running till that nxt swing low in dollar.

  59. Old Turkeys are making lot's of money today. Just did the math on what I could have made by keeping my full position. (Gonning to go cry now). LOL At least I made enough I can laugh at myself and still have a decent core position. Much better than loosing money.
    Note to self : Read old turkey story daily!

  60. Leilani, On your twitter acct their is a page where you can set it up to send you a text message when he puts something up.

  61. Leilani,
    i dont think twitter emails you the notifications but you cant try tweetymail.com as an addon. That doesnt work for me either but i have heard others who use it.
    he had silver at 31 and gold at 1340ish

  62. Maybe Gary should go to the beach more often... :)

  63. I would be careful getting drawn in, I know the lights are flashing brightly :)

    This is going to script and the buying today felt a little panicked at times.

  64. Poly, You are so right. I felt the panic like I missed the boat and I have been through it enoungh to know that means raise your stops on leverage and sit on yours hands. Eaiser said than done in most cases. I personally already sold down to a core position so I am ready for panic selling. That may take a while?

  65. Tonight's report will be late as we are only half way through our trip today. It will be probably another 6 hours or more before i get back to the hotel

    I can say there isn't going to be much to report though. We certaily don't have nay topping sign yet. So we will just continue to twiddle our thumbs for now.

  66. Gary,

    By trip do you really mean "pub crawl"?


  67. This comment has been removed by the author.

  68. How is that any of your business, Nick?

  69. This comment has been removed by the author.

  70. Hey Gary,
    If you have time, stop by the Love Shack in Kihei and say hi to my Auntie Lila...The Pleasure Queen of Maui. Hope you guys are enjoying the warmth of the islands!

  71. This is interestng. Its hitting the mainstream. Getting closer to a top.


  72. ALL Bush tax cuts extended 2 years. 13 month extension of jobless benefits. Payroll tax cuts in works. Got to think gold is going to fly on this one.

  73. Hey all,
    Anybody remember that discussion about trading platforms that allow you to sell X based on price changes in Y? Sell miners based on price of GLD, for example? I see Ameritrade offers this (Trade Triggers)-anybody else? I have ShareBuilder and they don't. I looked at Interactive Brokers, but their tools are way over my head. I want the simplest service that will do the job.


  74. So, if I get laid off, how long can I collect benefits? Sounds like a pretty good deal. Just keep the over head down. I could surf, read tons of books and blogs, and watch all the movies I ever wanted. Leaisurely hikes in the morning. Extra time with the kids. Damn, sign me up. Ok Uncle Sam, put me on the payroll. Now, if I could only get the boss to lay me off.

  75. Gary-

    We could be twins!

    Except I would be the twin with no muscles.

  76. Gold bearish sentiment is at an extreme, according to the highly reputable Ned Davis Research:


    Anyone else find this shocking!

  77. This comment has been removed by the author.

  78. Amazing that Ben and Europe are talking about QE3 etc when the current programs aren't even close to being done.
    PM's to the moon I guess...

  79. Since someone was nice enough to share their research of the SOS details, here is my bit. All the GLD SOS numbers for 2010:

    20100106 -69.63
    20100111 -26.56
    20100125 -24.46
    20100201 -33.33
    20100202 -64.84
    20100211 -36.24
    20100218 2.02
    20100225 -51.78
    20100226 -0.34
    20100303 -178.18
    20100316 -219.26
    20100318 -18.07
    20100326 -17.25
    20100329 -223.12
    20100401 -26.96
    20100405 -43.14
    20100409 -125.81
    20100415 7.59
    20100420 -20.22
    20100421 -17.81
    20100427 -75.73
    20100430 -18.23
    20100505 -5.42
    20100506 -24.13
    20100511 -60.4
    20100512 -127.52
    20100524 -28.98
    20100525 7.05
    20100526 -45.5
    20100607 -37.35
    20100622 -14.22
    20100624 -45.37
    20100629 -1.77
    20100630 26.47
    20100702 -68.39
    20100707 -10.64
    20100709 -21.13
    20100728 9.2
    20100730 -1.36
    20100802 4.03
    20100803 -7.45
    20100812 -49.25
    20100816 -35.04
    20100818 -8.86
    20100907 -4.27
    20100914 -9.92
    20100916 -24.02
    20100922 -2.54
    20100923 -25.84
    20100924 -54.24
    20100928 -5.28
    20101006 -3.45
    20101014 -12.48
    20101020 -9.85
    20101025 -23.27
    20101105 -4.89
    20101108 -55.17
    20101111 -22.2
    20101123 -2.56
    20101129 -28.64
    20101130 -12.62
    20101203 -15.37

  80. Josh,

    In etrade, it is called a conditional order. Not difficult to use IMO.
    E.g. If last price of GLD <= 133 then [sell order]...

    Hope this helps :-)

  81. Markets look to gap up strongly today and the miners could go berserk. S&P futures up over 12 and gold up over $10 already.

  82. Gary,

    You were going to respond to this question in the Monday report but I didn't notice the answer. Here is the question again. Perhaps you can just answer it here if that is easier. Thanks.


    Gary (or anyone else with cycle theory knowledge as Gary may be sitting with his Mai Tai right now),

    I understand we are in the normal timing band for an intermediate decline in gold. However, we are also in a very bullish time-frame for PMs. How can we tell if perhaps this will be a stretched cycle. This also seems to be a right translated daily cycle for gold, no? Could this also lend credence to a stretched intermediate cycle (or one that runs to the upper end of the normal timing band which I think would still be another 3-4 weeks). Some folks (Sinclair, Ben Davies and others) are calling for a year-end rally in gold that could be $1600-$1800 (and double that percentage for silver). Very tough call here. I tend to side with Gary because, well, he has been beyond accurate on his medium-term calls such as the July bottom. But can't he be right that we go into an intermediate decline but it happens in 3-4 weeks after gold goes much higher. What should one look for to determine if this will be a stretched cycle and does anyone think this is a likely event? Lots riding on this call here. Thanks in advance

  83. Gary,

    Sorry for bothering you with a question while you're on vacation, but I'm wondering whether you have a read on sentiment levels for Gold and Silver right now.

  84. Fusby,

    FWIW, someone posted this the other day.

    Gold bearish sentiment is at an extreme, according to the highly reputable Ned Davis Research:


    Anyone else find this shocking!

  85. Sentiment from sentimentrader.com show readings that are bearish for gold.

  86. Steve,
    Got back too late from our drive around the island to go into what we would look for.

    However sentiment is getting too bearish for stocks and gold to continue too much higher. Not to mention we are starting to get late in the daily cycle for gold and very late in the intermediate cycle for stocks.

  87. Looks like we are going to get the gap up in gold that Gary was talking about.

  88. Today's little $5 gap isn't what I'm talking about. A large $20 gap up to $1450 would be cause for concern.

  89. Thanks Gary,

    You mean bullish not bearish, right? Just let us know when we should go back down to core!

  90. Hey Will,

    Nice job on the SoS numbers for GLD!! How/where did you get those? Was it a one-day-at-a-time look at the WSJ SoS page? Or do you keep a record for yourself on a spreadsheet (something I intend to do from now on)? Is there a better source for these numbers than the WSJ site?

    Do you have a list of BoW numbers for GLD for 2010? If so, could you publish those too?

    Thanks much!!

  91. hi Gary,

    Just to check...Are you envisionning a correction in both stocks and gold? I am really confused, I agree with you that stockes should correct, but each time there is chance, there is a talk of further QE or tax cuts etc...what could trigger a correction from your point of view?

  92. sophia,
    When sentiment reaches extreme bullish levels we just run out of buyers. We are rapidly approaching those levels in both stocks and gold.


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