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Tuesday, December 7, 2010

SIGNS ARE STARTING TO FALL INTO PLACE

If gold closes positive today it will be moving higher at a 76% clip.


Today will mark the 14th day of the current daily cycle. We will soon enter the timing band for the next cycle low. The dollar is now deep into the timing band for a cycle low and could bottom sometime this week.

Sentiment is starting to get frothy. Traders are starting to find reasons for why gold and silver will just continue higher indefinitely. (JPM short squeeze)

All signs that an intermediate top is approaching. Trust me we will get a profit taking event. They come like clockwork about every 20-25 weeks.

I went over in the weekend report what to look for to spot a potential top.

Stay on your toes here folks!

329 comments:

  1. What do you think the odds are the cycle low will manifest in a shallow and mostly sideways manner before giving us another leg in January prior to an IT correction?

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  2. Gary,

    We havent seen any more SOS days after the one at 1200 levels last week. Don't you think we should see a few more SOS days in stocks.

    V

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  3. Pat,
    Profit taking events of an intermediate degree have to create enough fear to clean bullish sentiment. That doesn't occur with a weak sideways move.

    V,
    We don't have to see another SoS day. The one we got was large. I think it's safe to say we've probably lost the big money support under this market. Once the emotional retail traders are all in we will probably see a sizable correction. Certainly well below the 1200 level, which is about where the big boys exited.

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  4. Gary,

    a last question: usually, Dec is a good month for stocks...but we are over extended on the cycle, so do you think in view of your experience that the market will continue to rally until January 1st, or could trouble show up earlier?

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  5. Sophia,
    I really have no idea. But I tend to think we will probably top sooner than that as the dollar is now very deep in the daily cycle.

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  6. Gary,
    Are you saying we might see a $200 plus drop in gold? That's different than your original 11/28 weekend report. BTW, good to see you're still alert and not suffering from margarita hangovers.

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  7. Gary, Not sure if you've answered this but you're selling back to (when time comes)what level of core? 50%?

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  8. Mary,
    I doubt we would see a $200 pooint correction, but $100-$125 is probably likely.

    I'm suffering more from sunburn than alcohol at this point.

    How's the temps in DC BTW?

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  9. Mary,

    I think Gary was talking about S&P....I hope so... :-)

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  10. Poly,
    50% is my core but it will be different for different people.

    It should be small enough that you can weather an intermediate correction without freaking out and selling at the bottom, but large enough that you won't be pulling your hair out if gold just keeps running.

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  11. Gary,

    So the markets can sell off any time with any excuse. Is it ok to short equities at 1230-40 levels and just wait patiently till next month for covering at below 1200 level.

    V

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  12. Doc wrote

    All signs that an intermediate top is approaching. Trust me we will get a profit taking event. They come like clockwork about every 20-25 weeks.

    arent we only on week 19 right now? I too believe the intermediate top will come , but even another day or two like this makes for huge gains. (NO LEVERAGE OF COURSE)-but i still have a large position and the account is daily % up is unreal. BUT NOW stocks are gettng too high above 20sma for it to last too. starting to peel off some profits

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  13. My "Gary account" follows Gary....LOL. 50% it is.

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  14. Gary,

    I have to say thanks for your calm and reasoned reports that I get daily. they are a real help in keeping me disciplined and focused on the long-term.

    It's not easy sitting here with cash on the sidelines while things continue to rally, but it is made a lot easier by your rational explanation of where to find the next buying opportunity.

    I am about 80% invested at the moment and am starting to gradually scale out of some positions that are historically more volatile. I don't want to be heavily in these when the top comes as they tend to crash hard.

    I am interested in how you will reduce your core position to 50%, will it be a reduction across all your holdings to maintain the balance. Or are there some instruments that you prefer for your core holdings.

    For example I am 50% in a senior gold producers ETF and 30% in junior companies. So I guess I am wondering whether to reduce evenly or to sell the juniors before the correction.

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  15. V,
    You would have to be nuts to sell short.

    Wait till we enter the next bear market before you short.

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  16. I will trim evenly across the board.

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  17. Ugh, you had to remind me about the temperature. While you're running around nearly naked, we've got an Arctic blast from Canada that has me parked in front of a fireplace trying to defrost. I'm paying dearly for not attending! Thanks for asking though.

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  18. I've bought 50 Dec 53 put contracts to fade this open.

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  19. Gary,

    I am all in cash now. Exited too early last week! I guess I have to sit tight and wait for the next opportunity to get back in.

    F

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  20. Wes: I agree. My stuff is showing a near-record level of stocks seriously extended, and I am playing the short side small---which is probably a good sign because emotionally it feels like they will never go down!

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  21. The Key Relationship Between US Real Rates And Gold Prices

    http://www.zerohedge.com/article/guest-post-key-relationship-between-us-real-rates-and-gold-prices

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  22. DG,

    I'll not fight the rally. I have a tight stop on this, and it's a cheap price (.23) to begin with, so the only way this can become real money is for us to collapse from here.

    A real lottery ticket.

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  23. I sold partial positions at the open. My greed was hitting that level of gut buzz. At core now.

    45% invested in PMs. Will ride until an intermediate correction. What a ride since July!

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  24. GDX massive reversal right at open - on very heavy volume. Looks like intermediate top is right here, just like Gary had spoken about it.

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  25. And btw, the donut guy.. go order a dozen from Krispy Kreeme today..

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  26. @MLMT
    If this is the exact intermediate top then I'll be a happy guy. I still think there's a bit more froth coming. But was ready to get lighter. Up 50% on the year. Thanks Gary! Drink a Pina Colada for me. And get some sunscreen.

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  27. Open's and intraday can be misleading. Wait till the close and see if the reversal holds.

    We are getting close though. So if close is good enugh for you, you could start trimming.

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  28. Well that shook some folks out and instilled a bit of fear, no doubt. Now what, that's the key (at the risk of stating the obvious). If we can regain 30.5 & 1425 and hold there a bit, we're off to the races again, for a short while, at least.

    Ought to get some of those who sold the panic to chase a bit. Still think we could see a real panic spike up before the int high is in, but that's just a guess.

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  29. Yesterday I read somewhere, maybe zero hedge, an uplifting statement on PMs I would like to share:

    There are thousands with billions waiting to get in.

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  30. Looks like PMs are stabilizing.. and may gain back the lost ground for the day.... Gold needs to climb above 1418 level (from where we got that big spike) and GDX needs to take out early Nov highs.

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  31. It may indeed be the intermediate top but the markets are rarely so accommodating. It seems that everyone by now is expecting a serious whack in PMs which makes me wonder whether we are going to get one.

    I did sell another 5% into the open so now I am 85% invested but my reasoning for that was not timing, just discipline. Every time I have a 100% gain in 6 months I trim a bit. So I sold some EXK and NGD and AGQ but I doubt this is the intermediate top yet.

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  32. More importantly, there are billions with thousands, too.

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  33. When billions with thousands show up to buy PMs, by then the thousands with billions would have left.

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  34. Significant number of conditions this morning that a top was made at the open.

    I'm in agreement with gary saying signs are close, but I guess I'm saying I think it actually has already happened and that would be my bet if I had leverage to sell.

    (I have no bet on it though. I have minimal core looking for INT low).

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  35. Lotta vol selling the gap opens in the leading stocks like GDX, GDXJ, SLW.

    Ownership is being transferred.
    Look intraday on any chart.

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  36. I got back into my core and happy about it, was an unbelievable run from the summer. Gold $1,432, well above the previous highs and already off some $20. That qualifies as close enough to a Gary top in my book.

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  37. Possible 2b reversal forming in the S&P and NDX if we can end down at the close.

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  38. Gary:

    Thanks for the updates while on vacation.

    One more strike against Bernanke - stretching cycles and messing up Gary's vacation! :)

    Does look like we have a top in.

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  39. I find gary's thoughts to calmly wait to see the close valid and a full reversal back up after the volume gaps this morning would be more than interesting.

    Nobody is more clearly aware than me last few months that bull mkts surprise to the upside :-)

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  40. FWIW: GLD is not showing up (yet) on the BoW list. I would think that if today's high is NOT the IT top, then would should see at least a little BoW at today's low, especially considering that the low came in exactly on the lower rising channel line, a perfect place for a bounce higher. If today's high is indeed the IT top, then after this bounce, we would expect prices to break thru the lower channel line.

    GDX, GDXJ, SIL, and SLV also not showing on BoW list. However, SLW --IS-- on the list. We'll see what the list looks like at EOD.

    Caveat: Gary has said that the only stock/etf that gives reliable signals on the SoS/BoW lists is SPY, so use GLD and the other PM etf's at your own discretion.

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  41. i'll buy back hl @10 slw@ 38, assume we will have 2 more up days?

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  42. Volume in GLD and gold futures does not look larger than normal. I would expect to see climactic volume (larger than normal) if this were a normal IT top.

    However, we did get high volume around the 11/9 reversal, and MLMT has said that a retest of that high should come on low volume if that retest is going to fail. He said that high volume would indicate the market was going to punch thru that earlier high and make new highs. So far, we are on track for the retest and failure (that is, we go lower from here), but we'll need to see what the remainder of the day brings.

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  43. some on tv said $gold go to $1850...silver?

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  44. GDX now showing up on BoW list, near the top. SLW still on the list, but dollar value has gone down. Still no GLD, SLV, GDXJ, or SIL on the list.

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  45. to be or not to be?
    Ha! Nice one, redwine!
    {8-D

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  46. You have BoW and SoS data available for past dates. See where GLD shows up on the day of or the day before the intermediate top was hit... I haven't looked myself.. Just a suggestion.

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  47. MLMT,

    I'm thinking that if we do indeed have an IT top here, then we shouldn't see much BoW action on gold, silver, or miners. We would expect to see that happen near or at the IT bottom which according to Gary would be at least a couple weeks out.

    If we start seeing GLD and other related etf's on the BoW list, then that MIGHT be an indication that the top is not in because the big boys are still buying.

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  48. Gary,

    Think we will still get another chance to sell near the highs as you mentioned earlier?

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  49. Where is DG today? Kinda quiet around here...

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  50. This comment has been removed by the author.

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  51. I've been out doing my consulting thing (I actually have a job!). Not doing much trading. Am lightly short and out of PM's waiting for the dip. Sorry to miss the last little run-up (I got out at about $1380) but will be back in size soon. Am also wanting to short more stocks but need to see a tape clue that "this is it" (Like Gary has wanted---and now seems to have---for gold).

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  52. PIMA,

    >Volume in GLD and gold futures does not look larger than normal. I would expect to see climactic volume (larger than normal) if this were a normal IT top.

    You are looking at DAILY numbers on a chart in the MIDDLE of the day and comparing the bar size to the previous days that show *entire* days.

    If you look intraday like I said at any major security in the sector you will see LARGE volume - well more than the last few weeks - occuring at the gap opens.

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  53. This comment has been removed by the author.

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  54. PIMA,

    Appology. You referenced GLD and I was using SLW,GDX,GDXJ, etc.

    Yes. GLD is not showing as much dramatic volume in comparison to last few weeks. There is more at the open than normal, but it isn't blatent like the other stocks.

    I think the excitement was in the stocks and not so much GLD in the last few weeks. It's sorta like seeing the real estate bubble and saying that property in Iowa doesn't look that bad - without actually considering vegas, florida, and CA instead.

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  55. Starting to look like the real deal here, the IT top. GLD and gold futures have both busted thru their lower channel lines. Silver futures and SLV just now approaching their lower channel lines.

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  56. Looks like fun has started. Looking for gold futures to open under 1388 by the 9:30am ET NYSE open

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  57. 'course, there are channels within channels within channels. The first ones to go (the ones getting busted today) are the steeply uptrending ones that have been in place for only the last week or so. Next to go would be the ones in place since the July low. And the really big one is the one going back to the October 2008 low.

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  58. high beta AGQ drop 10 points...

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  59. Agreed--- I think it has begun! I sold a little early so am anxious for this correction so I can buy in at cheaper prices!!

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  60. Cheering on the correction here as well. Sold this morning most of my holdings this morning...

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  61. Pretty good drop. Tomorrow will provide more clues as to where we're at. The markets are wonderfully mental.

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  62. Yes,
    Cashed out the rest of my AGQ's

    Picked up some HL puts -- nothing crazy -- Just to have a little skin if this is the IT

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  63. This "core position" issue... If we only knew for sure that this was the IT top, we could sell everything and buy back in at lower prices! I hate hanging onto even a small position and watch it lose money every day for the next two or three weeks. But as sure as I sell that position, the market would turn around and head higher, leaving me without any position at all!

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  64. Picked up some Dec. QID 12 calls earlier for a short term trade.

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  65. The correction that follows a HIGHER HIGH is often more severe than the correction that follows a DOUBLE TOP or a LOWER HIGH. IMO, gold, silver and gdx will all quality for higher high.

    WRT core position - having a core position is the only way to keep the emotion out. It is as important as maintaining stops, taking partial profits or any other position management mantra.

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  66. pima, the #1 reason I believe in the wisdom of a core position during a bull market is that, unless a huge correction is expected, and it isn't right now, it's too easy for a surprise on the upside to cause a panic. With a core position, one can be more patient and still capitalize on unexpected moves (usually to the upside during the bull). Without a core, one ends up being whipsawed and chasing and buying and then selling again at inopportune times. Discipline, is what it brings, to me (grasshopper).

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  67. MLMT,

    You said, "The correction that follows a HIGHER HIGH is often more severe than the correction that follows a DOUBLE TOP or a LOWER HIGH. IMO, gold, silver and gdx will all quality for higher high."

    If I read you correctly, you are expecting a more severe correction here because gold, silver and gdx are all correcting from a HIGHER HIGH. Is that right?

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  68. A benign sell off considering they are PM's.

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  69. The "impending JP Morgan silver short explosion" may be the perfect timing tool for market tops. I saw that care bear video and immediately sold out of all my AGQ.

    You can expect to hear the JPM story repeated by silver newbies every time silver blows off from now on.

    And when your brother-in-law and next-door neighbor start telling you about JP Morgan's silver short position, you'll know the PM bull market is finally over.

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  70. Bede,

    The reason I point out higher high is... if someone is going to look at past intermediate corrections, then do take into account if those corrections came from a higher high or a lower high or a double top - that's all.

    I am expecting 1315 to be taken out, but I expect 1260 to hold for now. And I think 1260 WILL hold - only time will tell the truth though.

    IMO, gold will open below 1388 by 9:30am and will not get back above that level for the rest of the intermediate correction.

    So far gold is just 2% from the highs. So little damage is done yet. But holding on in the hopes of selling at the highs is stupid IMO.

    Gary has been warning about intermediate top for a while now. It is finally here and we are correcting from a higher high.

    Also, there will be many fake bottoms that will lull retail into thinking that the bottom is in... If you are tempted to buy, then this ain't the bottom. Very likely most will be shit scared to buy at the bottom...

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  71. and the $US was up sharply, broke 80 today. is it $0.3 from forming it's swing low?

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  72. MLMT and Godzilla,

    Thanks for your comments re core position.

    Okay, now how about some feedback regarding what to keep in the core? A cross section of GLD, SLV, and miners, or just the PM's and no miners, or just the miners and no gold or silver?

    Thanks!

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  73. So Gary, since we're paid subscribers, are you also including your list of daily supplements?

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  74. I know the PMs look like they will continue down from here but didn't Gary mention that there would still be another bounce once we got this initial leg that could carry prices to even slight higher highs? Did I misunderstand him?

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  75. PC,

    I had AGQ, EXK and SIL, so I dropped my more volitile positions, AGQ and EXK. I'm down to about 50%.

    GLTA

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  76. To Our Success, I say,,,

    I've trimmed on Gary's data and comments. I am down to a core position. I am up big since August 1st. I am happy with life like I've never felt in quite some time.

    My weight got away from me and even that is down. My marriage is under stress and now I have allowed myself the time, due to Gary, to administer or addressing issues that may remedy the problems life throws our way.

    I am blessed to share with some of you here on this board and I look forward to good times ahead, OR, good direction going forward, with all the issues life presents.

    Together we may help ourselves and grow to help our families and our community.

    God Bless Everyone.
    Tom

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  77. why are the sell offs so much more violent then the moves up? metals are getting crushed

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  78. TommyD
    like Donald Trump said: it is better to be rich and unhappy then poor and unhappy.
    Keep your head up and lets make some money

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  79. MLMT,

    Gold at 1390 almost to your 1388 at 10:51 EST.

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  80. TommyD-

    Nice comments. Great that you are taking the time to work on your marriage, I know first hang it's tough to make a good marriage last and thrive. My wife and I just went through some excellent counseling and are back in a better place.

    I need the reminder that good gains in gold and silver are no as important as family.

    Blessings to you and everyone else here. Let's prepare for the next intermediate bottom...2011 could be a spectacular year, but despite Gary's poo-pooing of the conspiracy types---please stock up on some physical (at least a small amt), food, etc.

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  81. So gold hit's 1390 after hours and breaks Gary's swing high target of 1397. Does after hours count for a swing high?

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  82. Burrito, I believe so. There's really no such thing as after-hours on gold, it's a global market. Right now Asia is setting the price.

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  83. @ CB

    "I know first hang "

    Was that a freudian slip?

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  84. I want to see it on the chart. in order for that to happen it will have to stay below $1397 in the morning.

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  85. I do not post here often. But I would like to say kudos to Gary for his great analysis. I told him he was crazy to think GDX would hit new all time highs. I am here to man up and say I was way wrong. You have done a great job. Keep up the good work.

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  86. Gary,
    Excellent comments again tonight after today's sell off.

    There's one thing I don't understand, though. If indeed the dollar is heading up right into a bull trap high, at which point it will reverse and start its long overdue big decline (i.e. ONE swing yet to come - a high), then how do you envisage gold first bouncing off a daily low, then making a swing high and going down, and only then to finally bounce off the intermediate low (i.e. THREE swings yet to come - low, high, low)?

    Assuming the single dollar high should line up with the final gold low, how could -prior to that- gold be making both a significant low and high all within the single ongoing dollar uptrend?

    Wouldn't that argue that on this occasion, gold's daily and intermediate lows will coincide (hence no gold low nor high prior to its big ultimate low), meaning gold will +not+ shortly bounce up significantly (and of course accordingly not reverse down from +that+ particular bounce-that-wasn't)?

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  87. Gary, Burrito, Lowtax

    B
    > So gold hit's 1390 after hours and breaks
    > Gary's swing high target of 1397. Does after
    > hours count for a swing high?

    L
    > Burrito, I believe so. There's really no such
    > thing as after-hours on gold, it's a global
    > market.

    G
    > I want to see it on the chart. in order for
    > that to happen it will have to stay below
    > $1397 in the morning.

    From Gary's Dec 7th:
    > If gold forms a swing high tomorrow by
    > moving below $1397 [...]

    Huh? So that means the after hours <$1397
    does not count? I tend to side with B and L
    that it does.

    Now that gold has moved below $1397,
    that +will+ show show up on the chart,
    won't it? Or am I missing something here?
    Even if it wouldn't close <$1397, it has
    still traded there anyway, which as far as
    I have understood it, constitutes a swing?

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  88. Yes, that was a slip. I no longer want to hang myself!

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  89. Burrito, that must have been some counselor! ;-)

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  90. Gary (and Walter and others)

    Go to www.bigcharts.com......put GCZ10 in your ticker spot , and you will get , ON THE CHART, GOLD 24hrs a day , and that low shows up on the chart too.


    WHAT SAY YEE GARY...Good enough??

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  91. Alex,
    Perhaps I'm doing something wrong, but at bigcharts.com the GCZ10 chart simply stops at Comex closing time. (Apparently Asia doesn't exist to them...?). No <$1397 gold there, to my eyes.

    Anyway, I use this 24h live chart and <$1397 clearly shows up right there:
    http://www.fxstreet.com/rates-charts/live-charts/

    (Choose XAU/USD for gold or XAG/USD for silver,
    all the way at the bottom of in its popup menu.)

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  92. Walter

    that's strange..i just went there and tried again and got 1391 as a current reading and it was on the chart too.

    I did try your link and got it tho...thx

    not sure why your bigcharts chart doesn't work...i get Gold overnight with GCZ10 and DXY for the dollar

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  93. Gary: I have a question about allocation. Since, for example, SIL is a lot more volatile than GDX, it's hard to know what your risk/exposure is. Do you have any numbers you use to measure as a guesstimate? For example: If GLD is 1, then GDXJ is a 2.5 (times as volatile)? Maybe SIL is 3 X GLD? SLW--? You get the idea. Or am I trying to be too calculating here?

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  94. If you look at the 4 hour chart, gold has very good support at the 1392 level. It might form a cup and handle on this chart.. Also on the seasonal chart for gold, at 7th of december exactly, it has a sharp drop, but only for 1-2 days, then it continues up. + the euro could be forming the handle of a cup-handle towards the usd.

    Looking at the euro/usd chart instead of the dx have some advantages, since it is the euro everything is about now. The dx index has other 'noise-interferences'.

    (But maybe wishful thinking, since i'm long..)

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  95. Alex - Perhaps it has something to do with bigcharts being part of marketwatch.com. When I enter www.bigcharts.com in my browser I automatically get redirected to bigcharts.marketwatch.com. Bigcharts.com as separate website doesn't seem to exist any more, at least not from where I sit (Europe).

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  96. Trond,
    I hadn't noticed the cup+handle, but once you do I'd say it shows equally well on the daily chart. Not sure if it qualifies though, as symmetrically it looks somewhat out of whack.

    On the other hand, if it is a c+h I'd say the 1392 level (=38.2% Fib) will not hold but instead expect a sharp spike down to 1380 at some point, which is the 50% Fib between the 1329.80 low and 1431.20 high.

    At least that is what happened with the larger Dec 2009 - Jul 2010 c+h, which also ultimately spiked down to 1157, its 50% Fib between 1045 and 1266. Of course right from that spike down the current rally started and never really look back so far...

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  97. Walter,
    Gold will have a bounce out of its cycle low whether the dollar drops or not. We've already seen gold trade in tandem with the dollar. It even dropped down into an intermediate cycle low in July as the dollar was dropping.

    At this point gold is trading on it's own cycle, with the C-wave being exacerbated by a collapsing dollar.

    Regarding the swing. Whether or not gold has formed a swing in the after market is irrelevant. It will form a swing in the New York market if this is an intermediate correction. When it does it will be my signal to trim.

    DG,
    I'm not sure why you care what the relative volatility is unless you are going to try to trade the bottom with stops.

    I'm not going to stop out of positions. If I'm early then I will just let the bull correct my timing mistake.

    But I think you've probably got the ratios pretty close although I think GDXJ is probably closer to 1.7 than 2.5.

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  98. Knowing, approximately, the relative volatility to GLD makes sense for those still calculating their core position.

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  99. Gary,
    Ok, I understand, the swing should be made in NY trading time. I find it a bit peculiar that apparently neither Asian nor European trading qualify for valid swings, but never mind.

    Of course you're right that if this is an intermediate correction, the swing will ultimately assert itself in all markets. However, I'd personally consider the whole point of a swing to be to serve as both an as-early-as-possible and yet as-reliable-as-possible warning/confirmation, and as such I'd argue it doesn't really matter when or where it takes place.

    Nevertheless, the question was when/what +you+ considered a swing and your answer is absolutely clear. Thanks!

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  100. It is interesting to note that there are so many comments about a higher high coming, this can't be IT, worst case downside is 138x or 135x. This is what major tops are made of - belief that we can't dump big.

    The sentiment at bottom (127x IMO) will be like - oh shit we are headed to triple digits or we are headed to 104x or 115x. There will be lot more talk of much lower targets - which will be an indication that the bottom is near/in.

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  101. MLMT [elementary??]
    These x figures - I assume they are sentiment levels.
    Can you indicate where I might access them please?
    Thanks

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  102. Steve,

    Those are prior intermediate tops in gold (if I remember right).

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  103. Thanks, Gary. It wasn't for stop purposes, but if I think I am long about $300,000 worth of PM's and it's all in SLW vs. in GLD (not that I buy GLD), that's quite a difference in actual exposure. I am not planning on tight stops, which I only use for certain kinds of trading.

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  104. Dollar and Gold both confirmed their respective low/high Swings this morning. Let the fun begin.

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  105. So, many here sold that open, I'm sure (I trimmed a bit, but waiting for the rest), so now it can bounce big. ;-)

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  106. Onlooker,
    That is how it usually works :)

    However it's too late in the intermediate cycle to press hard on the long side anymore.

    The easy gains have already been made.

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  107. The dollar just might come back down and test the 79.80 area (80.20 on the futures) and give us a bit of bounce here in the PMs. That's what I'm hoping for to trim some more.

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  108. Gary

    what are you doing awake?? :)

    does a bounce here usually last very long? thx

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  109. So Gary... I know, in the letter, you said we don't need to ask but, did you sell?

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  110. There goes the coveted 1387 on gold in RH.

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  111. Looks like that bounce isn't coming just yet. I sold the rest that I planned to sell when that last little bounce failed at about 1392. Of course, as it turned out, I would have been better off making all my sells at the open. Just figures.

    I'm at about 50% now.

    NOW we can get that big bounce. :-)

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  112. My read says that Friday or possibly though much less likely Thursday is when commodities and equities get taken to the cleaners. Lets see, SPX needs to bounce off 1206 area and close near opening levels for the perfect set up day. China rate hike may provide the trigger Thursday night.

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  113. Well, unless we get a surprise to the upside, I think I am done for the year. Took profits and now down to core. I feel real good. I want to thank Gary for being a great coach and keeping me focused. guess its twiddle the thumbs time and looking forward to enjoying the Holiday season...damm I wish I was in Maui...

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  114. Metals taking a real bath now.

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  115. Gold will backtest 1388 in RH (RH = regular hours; NY hours) most likely tomorrow to suck in more buyers and shake out those (if any) who shorted the breach of 1388 level. That will likely be the last chance for longs to unload before we get a 50-60 pt down day on Gold.

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  116. Impressive yes, but epic will be a 4-5% gold drop and a 8-10% move down in the PM's. We've had those days before

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  117. IMO don't even think of buying here... We haven't yet seen the 5% gold down, 10% gdx down day yet - I am sure it is just around the corner...

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  118. this is not the place to buy but rather stay short

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  119. Gary: After two trips to about $1420, you stated you think that we need a third (a second test of that area) out of the coming daily cycle low. How likely is that? I wouldn't expect it given how stocks trade, but you know a hell of a lot more about gold trading than I. A bounce, yes, but all the way back to $1420 again? Can you expand a bit? (Here or in tonight's letter). Thanks.

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  120. Just shorted some AAPL at 318. Once everyone thinks a stock is perfect, it easy for it to tank during a mkt decline. Yesterday's reversal and then breaking yesterday's low this morning isbearish. But it IS a great company so I am nervous ( a good sign). I posted a few days ago that emotionally I felt like gold was never going to go down again...right at the top. Our own emotions are a great guide as to what the next move is. ""Shorting AAPL---are you nuts?"

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  121. just set limit order AGQ 128 for now (20 ma)

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  122. AGQ dropped from $145 to $110 last month and that wasn't part of any intermediate decline. I would think $25 silver and below is easily in the cards. That would be AGQ approaching $100.

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  123. oa92000: Don;t trade randomly. The chance of AGQ stopping there for more than a bounce is very small. You've been following Gary this long---why buy at the beginning of an intermediate decline? We topped out just yesterday! There will be lots of points on charts that could conceivably mark a stopping point, but they will all fail as gold tanks. Patience and discipline. Go take a walk!

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  124. Agq can go to 90 on an intermediate decline, if not lower.

    Think in terms of time, not price. Do not buy agq until January, when Gary gives the word.

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  125. No doubt, silver (and therefore AGQ) is more likely to knife right through the 20 DMA, and possibly the 50. It's way too early to be buying the dip.

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  126. DG,
    thx, just cancel my AGQ order..

    patience Is a virtue

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  127. MLMT,

    You seem to have a pretty good feel for this market. What's your background?

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  128. The 20DMA of AGQ offered some great points to buy this past few months. But of course that was "the past few" months :)

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  129. Has anyone see this? http://goldscents.blogspot.com/2010/12/signs-are-starting-to-fall-into-place.html

    Looks like he (Toby Conner) is coping Gary's advice and charging for it.

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  130. We probably have 5-6 weeks before it will be time to buy again. Now is a good time to go on vacation for a while folks.

    DG,
    After the kind of run we've had the market is going to try to buy the dip when gold puts in the daily cycle low. I expect gold will at least come close to the highs during that move and it may even make marginal new highs.

    It's way too deep into the intermediate cycle to get suckered into that trade though.

    So other than maybe playing the 2b reversal for traders there isn't going to be anything to do for a while.

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  131. BC,

    Toby is Gary. He has two sites. The Toby site is a joint venture with a marketing guy which Gary has said has brought him additional customers.

    ReplyDelete
  132. BC gary=toby connors.Same person on two website :-)

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  133. Gary,

    When do you expect that bounce that could that the PMs at or close to the recent highs?

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  134. Prof Depew on Minyanville today shows that, in Demark Theory, a Monthly Sell Setup on Silver has occurred, so 1-4 bars implies January through April probably won't be much fun for silver traders. Also, next year, a YEARLY Sell setup will record, meaning 2012-2015 will probably be very rough for silver. Depew is bullish silver long-term, but he sees better opportunities elsewhere and does not believe it will outperform stocks as he thinks it will have less to do with currencies and more with industrial uses. He is therefore getting rid of his silver in 2011 that he's held for 9 years...

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  135. Ck,
    That's no the way intermediate cycles work. They dip for one daily cycle usually. Then we should get the final move down into the three year cycle low in the dollar index. That should drive the final leg up in this C-wave.

    Anyone waiting till April will mostly likely miss the largest part of this C-wave. Not the best strategy in my opinion.

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  136. Steven,
    We will just look for a swing low next week as the most likely bottom.

    I wouldn't recommend trying to catch that bounce though as it could roll over quickly.

    Which is to say there's no guarantee gold will test the highs.

    At this point there isn't going to be anything to do for at least a month.

    Be prepared to be bored for a while.

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  137. Gary

    in previous reports you stated that you feel this C-Wave would have 3 up-legs instead of 2 ( no quote intended). to avoid a d-wave down now to your core position, you must be correct i would imagine...

    I am wondering why you think 3 waves.? is that based solely on the fact that you expect the dollar 3 yr low?

    ReplyDelete
  138. Thanks for clearing that up. Being a newbie to all this I have enjoyed the great information from everyone and have learned much from Gary on how to navigate this market.

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  139. Gary, do you have a target for the bottom on gold? are we going under 1300?

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  140. What is the DOC's blog URL address?

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  141. This comment has been removed by the author.

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  142. GARY/ALL,

    Stockcharts $GOLD **INCLUDES** 24hr data (based on my examination of the chart compared to other data sources and the FAQ comments at stockcharts.), so it will always end up showing what happened last night "on the chart", but MUCH MUCH LATER.

    You are making a major mistake thinking/talking like this and using that data.

    The FLAW here is that that chart is updated EOD (end of day) *only* (see "EOD" on chart title) due to stockcharts systems.

    So you are actually making a mistake in a number of ways.

    The lows of last night ARE real and WILL show up on that chart, but only *after* the CLOSE today. Over 12 HOURS later. Welcome to the fast response crew.

    So you have a DOUBLE delay in the feed you are using. The idea of waiting for it to 'show up' whenever stockcharts systems kick in is only delaying your response via cheap data and being misinformed about what you are looking at.

    (You could likely get even more info about the nature of the $gold quote by calling them. I haven't).

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  143. the DOC:

    http://www.thedocument.com/

    ReplyDelete
  144. If $GOLD did *not* include 24hr data (or close to it) then the chart would have a bunch of gaps and look like GLD which is only US hours. It doesn't.

    Go compare the charts yourself and also notice the "EOD" on the gold chart.

    The talk of how everybody is executing on the $1397 is messed up.

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  145. DG

    To add to what Gary said (and to reiterate what he has said before, I believe), the fact that this gold daily cycle is shaping up to be right translated makes it quite possible (if not probable) that it will make a new high before the interm cycle fails.

    Of course it's not a 100% thing, so there's the risk. And the likelihood of lower prices than present is quite high as we work into an interm low. So the higher odds play is to sell here rather than hope for the big bounce. At least that's my take on it, and how I've played it.

    Although I may attempt to play a bounce out of the daily cycle for a trade (if a good entry is apparent), with a quick sell trigger on the bounce. The downside is that I get stuck with the position that I didn't plan to carry into the interm low, that the longer term bull will bail me out of.

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  146. Gary, with all due respect

    Fuck your bullshit cycles

    PM's are about to BTFO and I am buying the dip

    You should know in parabolic moves cycles get twisted

    L8er

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  147. pimaCanyon

    Thank you for Doc's url. Question, is there others on this blog that also subscribe to the Doc too?

    ReplyDelete
  148. The clear question to pose to stockcharts if anybody cares (which you SHOULD cause this is real money) is to find out:

    1) if $gold is 24hr data or what subset of time thereof (i'm telling you it is by examination, but you should NEVER trust others when your money is at stake. You guys are acting like a bunch of sheep on this whole 'overnight data' thing instead of getting the correct answers like your MONEY DEPENDED ON IT...which it does.)

    2) If 24hr data, then where is the CUTOFF between days. It might be midnight; it might be LBMA market, it might be US market.

    Do things right when you need to depend on data. Dont' argue in the dark.

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  149. p.b.

    'with all due respect' ???

    that wasnt very respectful , but to each his own.

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  150. TZ: What about the day's range shown at Kitco shown on the left ("Low/High") at kitco.com?

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  151. TZ,
    All I care about is seeing a swing on the chart. It will occur if an intermediate decline has started so worrying about the Asian market is kind of a waste of time.

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  152. P B,
    Wouldn't it be more civil to just say you were buying here and leave out the rude comment.

    Manners really aren't that tough.

    BTW cycles absolutely do not get twisted in a parabolic run. We've had many C-wave tops and the cycles worked just fine at everyone of them.

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  153. DG,

    Kitco shows 24hr data on most of their charts/readings.

    As for whatever "day" high/low you are looking at, *again*, you should CONFIRM and not guess from them how they define a "day".

    The cutoff could be any of a number of different options. The "day" might be 24hr, US only, LBMA-to-LBMA, etc.

    Don't guess. Ask THEM. (or don't use the source if you cant' determine answer as trustworthy).

    I'm amazed how many people want to make a million, but won't either actually CALL somebody to answer a critical question or PAY a small amount to get correct data. (Not jabbing at your DG. Just trying to let people understand that people don't get successful in life by bumping around into walls or cheating from 'the guy taking the test next to you' who is probably dumber than they are.)

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  154. Don't know about stockcharts, but TOS charts show daily candles beginning when the stock market closes for the day. The trading that occurs after 16:30 Eastern appears in the next day's daily candle. That candle shows on the chart after 16:30 on the current day.

    You can also monitor AH trading in both futures and equities when you're looking at smaller timeframes than the daily.

    So there's no way you'll miss the AH action on TOS charts.

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  155. GARY,

    The fact is you use $gold on stockcharts for your call and to write your newsletter.

    I'm telling you that the break below $1397 occurred HOURS ago and will magically 'appear' on that chart about 4 hours from now for your comments tonight.

    If you intend to take actions based on that chart, then you will be 12hrs behind people who know how the chart is constructed and whether or not the asian data is going to appear on it after 4pm.

    I'm simply highlighting based on my examinination that it includes that data and will show the break you suggest. Having to wait for that long a period of time due to poor data might result in large losses in the future.

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  156. Remember,

    I'm using a DIFFERENT source for data (esignal), so I don't care as much.

    I also count overnight data in all numbers and calls so the $1397 break is already a done deal for me.

    Also, Gary, your technique isn't as fast in-and-out of the market. More methodical and controlled, so the $GOLD delay/issue may not be of concern.

    It is still important for people to KNOW about it however - even if they then *dismiss* it.

    Anybody who wanted to take some action on $1397 at $GOLD from stockcharts is (I am *suggesting only*; reader beware as always) already hours late and will see it this evening when the chart updates.

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  157. PIMA,

    Technically, for NYMEX/COMEX/GLOBEX, a "day" in gold starts at:

    6pm SUNDAY NIGHT till
    5:15pm MONDAY EVE (eastern)

    at 6pm Monday night you start
    the TUESDAY session (till 5:15pm Tuesday).

    Friday's session ends 5:15pm.

    Most paid chart services will follow this convention cause it mirrors the main US exchange (from my experience).

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  158. This comment has been removed by the author.

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  159. instead of gold, maybe should buy some coffee .. :-)

    http://www.mongabay.com/commodities/price-charts/coffee-price.html

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  160. Gary

    in previous reports you stated that you feel this C-Wave would have 3 up-legs instead of 2 ( no quote intended). to avoid a d-wave down now--- to your core position, you must be correct i would imagine...

    I am wondering why you think 3 waves.? is that based solely on the fact that you expect the dollar 3 yr low?

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  161. I do not post here often. But I would like to say kudos to Gary for his great analysis. I told him he was crazy to think GDX would hit new all time highs. I am here to man up and say I was way wrong. You have done a great job. Keep up the good work.

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  162. If gold makes its way back to 1388 today in RH, holding longs may be a bad idea.

    The bottom that gold put in is decent. Look at the 5 min chart of /GC --> you will see that the bottom got retested on low volume - this is what you want to see for a reasonable bottom. If gold closes near 1388, I will expect gold to gap under today's low by the time NY markets open.

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  163. Alex,
    yes I think we have more more leg up. Part of the reason is that the three year cycle low is due in the spring but also because what we just saw was no C-wave top.

    We will see miners stretched 40-60% above the 200 DMA at a final C-wave top. The gold:silver ratio will drop to 40-45.

    The Gold:XAU ratio will be below 5.

    None of those things have happened yet. Until they do I think the odds are very small we've seen the end of this C-wave.

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  164. Thank you Gary-

    good point regarding a C-Wave top , rather parabolic and over extended...thx

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  165. Gary,
    I have to agree with TZ. At the time of your Dec. 7 report, Gold was very close to if not below $1397 (re:Kitco.com). Would be good to get that context.
    To this point (i.e. gold already below your target sell stop), do you wait for the market open or do you try to sell in the pre-market?

    Thanks!

    PS class reply to the rude dude.

    BTW did you swim in the Seven Sacred Pools? Was there on my honeymoon and loved it.

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  166. Did you see how gold touched 1387-88 level and retrace back.

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  167. FMOC next Tue.. think $USD shound move down again to ??

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  168. I usually don't trade in the premarket because of limited liquidity.

    I think you fellas must be more worried about a half percent than I am. I don't care if I miss the moment the swing is formed or not. And actually we can't officially have a swing until the close because we could trade high enough to form an outside day.

    A few hours certainly isn't going to erase 4 months of gains so catching the exact moment the swing occurs isn't a major issue for me.

    We did see the seven pools on Monday although I didn't swim in them. (forgot the swim suit)

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  169. Gary,

    None of your C-wave-top criteria were met with the following exceptions:

    1) GDXJ exceeded its 200 day MA by 47 percent
    2) SLW exceeded its 200 day MA by 91 percent!!

    SLW is out there!

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  170. P.C.

    actually-

    NG was 100% over its 200sma ,
    and HL and EXK ,etc were about 90% over too...

    what a run , hope it wasnt a top ;)

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  171. Now we are talking!!

    http://marketing2.direxionfunds.com/forms/GoldMiners2x?elq=7f0d6b28d5c14254af2da3397fe0a604

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  172. @Daniel,

    Leveraged ETF releases by Direxion have marked a MAJOR top/bottom... And so have the reverse-splits. Something to keep in mind....

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  173. Alex,

    thanks. Yeah, I should have mentioned that the only individual miner I looked at was SLW. I also checked GDX (less than 40 percent stretched, 20 something if I recall), GDXJ (met Gary's criteria), and SIL. SIL does not have 200 days of data, so there's no 200 DMA yet on Prophet charts. However, I just checked TOS and they calculate a 200 MA! They must be using what's available (approx. 120 days). Using that MA, SIL was stretched 97 percent.

    So it does look like the junior gold miners met Gary's criteria for a C wave top. The silver miners that we looked are way beyond Gary's criteria. However, the other ratios that Gary mentioned are not within the range he's expecting, so hopefully, this C wave is not done yet!

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  174. MLMT-
    Yes I am aware of that. Will wait for Int. Bottom etc.

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  175. GDX barely outperformed GLD over the past year. There are those who think the components of the HUI, XAU & GDX are targets of naked shorting.

    GDXJ is up 63% over the past year, ps...SLV is up almost 60%.

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  176. Might have to start a coil watch for SPX.

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  177. That blows, I want 3x ETF's :)

    Interesting they have a bear miners ETF. Cool stock symbols too, DUST and NUGT.

    But why play a leveraged gold miner ETF like NUGT when the junior miners ETF GDXJ appreciated more than 2x this underlying NUGT index!

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  178. SLW down 12% in 2 days. amazing...

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  179. If anyone is interested?
    these Direxion ETF's are 2x bull and bear GDX (no GDXJ)

    http://www.direxionshares.com/pdfs/PR_Gold_Miners.pdf

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  180. http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&b=5&g=0&id=p81021002026

    4:05pm; no update yet on $GOLD;
    chart date still says Dec 7

    when it updates, the day should be approx:

    high 1405
    low 1372

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  181. They are not tracking GDX, they are tracking $GDM

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  182. "SLW down 12% in 2 days. amazing..."



    SLW is up 1136% since it launched back in 2005, 614% over the past 5 years, 158% over the past year, etc. YTD 154 vs 53% for SLV.

    Let's get some perspective.

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  183. http://stockcharts.com/h-sc/ui?s=$GOLD&p=D&b=5&g=0&id=p81021002026

    they updated gold at about 4:15-4:20pm eastern

    high and low approximately as expected

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  184. Since the high on $GOLD at stockcharts of $1404.10 for today's bar happened *yesterday* early evening at 7pm or so, it is quite clear that they include 24hr data.

    And also that any activity occurring after 4pm eastern will not be visible using this chart/source until almost 24hrs later after the main market has closed the following day.

    Use it or don't use it as you see fit, but be sure of the issues involved before you lay your money down.

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  185. >it is quite clear that they include 24hr data.

    Or something like that give or take. Remember, these are only my comments based on my own observation - maybe wrong. The phone number and email of stockcharts offices is easily available to anybody who wants to be sure of the EXACT answer.

    ReplyDelete

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