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Wednesday, June 22, 2011

DEFLATION IN OUR FUTURE

Make no mistake, the four-day rally we just saw was nothing more than short covering in front of the Fed meeting just in case Bernanke surprised us with QE3. As expected he confirmed that QE2 would end on schedule. The dollar rallied and the market sold off on the news.

Folks, I don't think this is over yet. In the chart below you can see that every intermediate cycle low exhibits some kind of capitulation volume as market participants panic.


We clearly have not seen any kind of a panic selloff yet. As a matter of fact volume has been running slightly lower than average. This is not what happens at a true intermediate bottom.

The average duration of an intermediate cycle is between 20 and 25 weeks. Two of the last three intermediate cycles bottomed perfectly in that timing band. The March cycle was slightly shortened by the Japanese tsunami which generated tremendous bearish sentiment in a very short time.



However there is no serious calamity that should shorten the current cycle. One could claim that the Greek situation is driving the decline, and once it gets resolved the correction will end. I think that's highly unlikely. The market has known for over a year that Greece is going to default. There's no surprise there. I suspect the next Black Swan will come in July as Spain, or Portugal, or Irish bond yields spike, or something completely out of the blue occurs, like an implosion of the Australian housing market. It's in times of stress that flaws in the system break.

Since we don't have any capitulation volume yet, and it's still too early for the intermediate cycle to have bottomed, the assumption is that this correction isn't finished. 

So far the market is still following the template I laid out in "The Bear is Back" post. I expected some kind of counter trend rally to relieve the extreme bearish sentiment levels and oversold conditions. We are getting that rally now (it may have already ended).

Once the counter trend rally runs its course the market should have another leg down bottoming in late July to mid August. At that point I expect Bernanke to freak out and initiate QE3. That will be the signal for a more durable, and probably explosive rally.

But remember, the most violent rallies occur in bear markets!

469 comments:

  1. Interestingly, the Gold:XAU ratio just tagged its rising trendline that began when gold stocks started falling in April:

    http://stockcharts.com/h-sc/ui?s=$GOLD:$XAU&listNum=2

    If the trendline holds, gold stocks are going to get hammered even more than the metal.

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  2. Gary,
    Just wanted to ask again, what do you think will happen with the big banks?
    I've got some January puts on WFC, BAC and C as well as some November puts on LNKD (I think that stock will go to 15 by December if not sooner).
    Building up cash position and holding tight for the buy opportunity coming in the metals (BTW, I started preparing for this event BEFORE I subscribed to your premium site :)

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  3. General investors in stock market have no idea what is in front of them. Personal accounts and 401Ks get demolished and people think buying on the way down is "dollar-cost-averaging".

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  4. The government has made it painfully clear that the banks will be protected at all costs. Personally I won't touch the banks long or short.

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  5. Wall
    you need to pick a bank that the gov is mad at and wants to make a example out of. short that bank and you will do good. =)

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  6. She is cute and tells me what I want to hear about Gold in the short term.

    http://custom.yahoo.com/talking-numbers/?sec=topStories&pos=9&asset=&ccode=

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  7. Harry235, nice link. She looks better than Marc Faber

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  8. Gary,

    On the cycle count chart for the dollar you have 6/3 as the end of the last daily cycle, correct?

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  9. Gary,

    Im confused, the dollar chart is from 6/16 and it says day 11 in the cycle. If the new dollar cycle began on 6/8 that would put us at day 7 of the cycle, wouldn't it?

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  10. Day one occurred on June 8. Today is June 22. There are 11 trading days between June 8 and June 22.

    Hence the dollar cycle is on day 11.

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  11. Gary,

    I see, you update the days daily but not the actual chart, hence the chart is from 6/16.

    Thanks

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  12. Yes it's too much work to redo the charts every day. I redo them every week or two or if I think a cycle has bottomed.

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  13. Gary,

    Sorry to trouble you about this again, stocks first cycle day?

    If I count 19 days (as shown) that puts us at 5/27 being the first day, is that correct?

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  14. Amazing- opposing views are offering a rare chance to evaluate tools and information sources:


    James Turk now predicting 40$ silver before July 4th!


    I used to be a huge Turk fan thinking that he must have unique perspectives based on customer demands and knowledge of "backwardation" etc.


    If this intermediate low does end up crushing silver, I will have to wonder what else is "BS" from Turk/KWN gang and reconsider my goldmoney.com account....


    http://www.fgmr.com/trading-current-positions.html

    ReplyDelete
  15. here r our future sellers
    http://screencast.com/t/7C0C4vI9xkxF

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  16. Beksachi,
    I'm in a similar situation as you... Don't however disregard the possibility of a further delayed IT cycle low and a short rally for silver up in the lower 40's. Then the hammer falls, thus proving both sides correct!
    I'm getting more and more thick-skinned when it comes to the Silver crew's projections as it is most likely correct in the long term, but it can still hurt you in the short term. They can always cry manipulation and thus exonerate themselves from their projection failures. That is why I find it useful to regard their data with a fair bit of scepticism. Again, all this talk about end of the world, we're probably not there yet so no major implosion in the fiat currencies yet. In the longer term though I think that we can all agree that PM's will outlive the paper currencies, it's just a matter of squeezing out the most of it!
    /D

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  17. This might be a meaningful swing on gold, if this turns out to be a LT cycle. Should be intersting.

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  18. Hi Gary:

    Since we are looking at an A-wave for Gold and a more substantial rally for stocks in late July / early August, does it mean we will have only 1 intermediate $$$ rally cycle? I would think that after a major 3 year cycle low, the $$$ would have 2-3 RT intermediate cycles…

    Thanks!

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  19. its all about the dollar :o)

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  20. wow the dollar is really flexing its mighty muscles

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  21. That was a good post Gary. I particularly liked the SPX chart showing capitulation selling at intermediate lows although I prefer to call it buying as that's really what it is, smart money buying everything they can get their hands on at fire sale prices.

    Shows how simple it can be.

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  22. NJ,
    That's a tough one to call. I expect Bernanke to begin QE3 at the bottom of this intermediate cycle. That could start an extremely left translated three-year cycle that would potentially destroy the dollar.

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  23. Silvers really holding up well this morning compared to gold.

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  24. Anyone new to this blog and cycle theory should read TSI trader's latest post. He gives another explanation and summary of where we are in the gold cycle. It's nice to see conformation of the prevailing theory expressed in other sites who are analyzing the same data.

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  25. As expected, We are getting a nice Gap Down in Silver SLV. :)

    Love that 7 Count !

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  26. question: are we going below 1530 today on Gold? Hope so...

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  27. sophia, why is $1530 significant?

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  28. Look like we already did....

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  29. Gary, nice call on silver. You kept me on the right side of the trade lately when I might otherwise have gone in the other direction based on my (incorrect) reading of the charts.

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  30. Eamon, because for me we haven't moved much..Yes, yesterday was short covering as Gary said it, but 1530 seemed always to hold well...So I was just asking...

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  31. This comment has been removed by the author.

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  32. Wow, nice call on gold Gary.

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  33. I think that I am puzzled...The end of QE2 was given 6 months ago, so now, people are feeling uneasy, but they still buy US Treasuries despite the fact that by June 30th, Ben will not buy them anymore and nobody else will take their spot...The rest is noise

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  34. This comment has been removed by the author.

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  35. Wow. If this is part of not being able to make money in a bear market, looks like I am going to make a lot non-money today. For those who shorted silver on my silver-sell-signal post yesterday, now is a time to just sit and not look at your profit as it is probably going to tank hard for a lot more than a few days. "No one has ever gone broke taking a profit", but lots of people have gone broke taking small profits which do not offset the inevitable losers.

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  36. I guess 1530 was a good support after all... :-)

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  37. The US is the new emerging market! 2 days sharp rally, followed by big selloff...P&L getting trashed for the big boys as they cannot cover on time, not good, not good...

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  38. Gary-
    Do we have a failed daily gold cycle at 1512 or 1520? Thanks.

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  39. The safe short play IMO are SPY and USO (oil) as deflation and the economy is tanking.

    Although Im short SLV and EUO too, these pose some risk, Silver being tied to the gold, fed and safe haven play and EUO tied to further US gov/fed weakness and ECB plans.

    They're a quad dollar backed trade, so be careful thinking you're diversified when they're highly correlated.

    For now, enjoy the short ride and if you want on, get it now before it gets expensive! Don't forget, Gold IT cycle low coming, save the big guns for that.

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  40. Sophia,

    Best bond manager, Jeff Gundlach, buying treasuries as Bill Gross sells them. Gross was dead, dead wrong. I'd worry when Gundlach sells them.

    Money Market funds of Vanguard and Fidelity, 40 to 50% in Euro paper. Smart people are switching to Treasury MMF's.

    There are buyers of Treasuries.

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  41. Nice call Gary, DG

    Well said Poly, Save the big money for that move. I really hope this goes on for the next few days. we'll see

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  42. DG,
    No one ever said you can't make money in a bear market. I said it's very hard to make money in a bear market.

    The last month has been a classic example.

    How many people were unable to short on the violation of the daily cycle low? I think it's safe to say that quite a few held off hoping for a bounce and then ended up chasing.

    Then if they didn't cover on the tag of the 200 day moving average they got caught in that violent counter trend rally. How many get knocked off out of their short positions during that rally.

    Now the shorts are in the same position. If they missed the exact top do they chase into today's gap or do they hope for a rebound, and if the rebound comes will they actually be able to sell it?

    Markets go down differently than they go up. Because of that it's hard to make money on the short side. I've been doing this for a long time and I can honestly say it's very difficult for me to make money shorting.

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  43. DG, maybe you could patent & lease your SLV system out to the big banks

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  44. DG….Nice call on silver! I took a small play on it, since I was getting soooo bored.

    Real interesting from an education view point. Last Thursday "the sky is falling"...Friday until mid-day yesterday this bull is going up forever...mid-day until today, aggg Armageddon. And nothing has happened. Greece was as anticipated, and was very likely….FED no news except what was given before….maybe the big news was Ben saying “NO QE3”…might be his take to crash commodities on purpose before QE3... maybe that is Ben’s plan, monetize debt, stop to crash commodities, monetize debt….repeat rinse wash.

    Not looking forward to the inflation deflation debate again. I guess my view of deflation and inflation is slightly different, but I don’t consider deflation a period of falling prices. When prices surge 100% to 300% and drop from stupid levels, I don’t call that deflation…a period of falling prices or what have you, but deflation I would view as a permanent fall in prices due to economic conditions not a fall in prices due to prices surging beforehand.

    In other words the multi-decade trend line needs to trend down…Oil was in the 30s what in early 2000s. (so using oil as an example)…oil would need to fall to at least 30’s and stay there for me to consider deflation a REAL reality. But as many know this isn’t possible since the marginal cost is say $80….In otherwords, I don’t see sustained deflation unless the entire system truly turns on itself, and we get something like the great depression, banks need to go under, and wages need to start falling as unemployment goes up…which all means the dollar has to reverse path and increase substantially in value. Anyways a point of view beyond equating deflation with falling prices…in fact if oil were to fall to 50, the upwards trend would still be intact and inflationary, which implies a 5%-7% inflation in oil since early 2000s.

    WOW what a great blog!

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  45. Thanks Haggerty,

    That gold cycle plan to spike above $1,550 and drop ended up being spot on, did you get yourself some?

    This type of gold drop after a spike is a classic gold cycle top move.

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  46. Haggarty,
    If this is the start of gold's intermediate decline, and it probably is, it should last at least a month.

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  47. so much emotion

    prepare for some wild swings.

    remember gold went as low as 1511 last week. i hope we don't trade below that for longs.

    1525 is the key support. gold still healthy if it maintains this end of the week.

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  48. Gary
    Another huge Gap down before the open, trapping all the longs again. The market had the opportunity to react like this yesterday during trading hours. Maybe this is a new trend?

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  49. All
    I have to argue that it is hard to hold on the short side, I got in to this trade way too early and it has pounded me a little. I bought a few more puts yesterday on GLD but I wish I had bought more. If I see a decent price at the open I will buy a few more

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  50. Edwin,
    Even a move down to 1320 is still a healthy bull market in gold. This is just a normal profit-taking event that happens like clockwork every 20 to 25 weeks.

    This is essential to clear sentiment, clear out the weak holders, and build the base for another move up.

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  51. Gary, great work recently btw! Seems that your reports and blog posts are cyrstal ball'ish lately. Look forward to your call to get back into PM's...patiently, somewhat lol.

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  52. Alex in Montana,
    Thank you for your post getting me straight on treasuries. It makes total sense that Ben can stop purchases knowing full well that the flight to safety from EUO and other places( as dollar strengthens ) will roll into treasuries for a 'said amount of time.' There will be a time when people leave treasuries.
    When do you think, INHO, this will take place?

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  53. Gary,

    yeah definitely. Gold bull still intact. It doesn't go to zero.

    Steepness of the drop though.. we can't put a number on that one. Just hopefully not lower than 1309 the low for the year.

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  54. Crude getting butchered, doesnt really help the gold:oil ratio, for those following it.

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  55. each one of these commodities follows a cycle and each one has a bunch of different players, (this is a game of cat and mouse)

    a little different but they all share one thing in common these commodities are priced in USD.

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  56. exk super high beta, back to 5 dma

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  57. Takin my Profits on my ZSL Position (great trade ) .will reload . should we bounce to 20sma

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  58. Gary: Fortunately no one needs to get "the exact top" in a bear mkt anymore than one needs to get "the exact bottom" in a bull market. You just need to get the area right so you don't get too far in the hole and put pressure on yourself. I did not get the exact top on a single position of my 8-10 positions, yet every one is profitable. "Exact top" means nothing. If you shoot for perfection of course you will fail at that, but that is n the goal. The goal is to get the heart of the move.

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  59. Tommy D,

    I'll take a stab at answering your question as to getting out of Treasuries:

    1) Risk Off trade in full swing since April 30. Treasuries anticipated that by double bottom early April.

    2)Gary and others believe if stocks and economy tank Bernanke prints again. So do I.

    3) If stocks down 15% to 20% AND economic numbers miserable market will anticipate Bernanke printing again.

    4)That anticipation period will probably be low in Trasury yields.


    5) In any case if Gary says buy gold, silver, mining shares etc., then do that as the rise in those will far exceed anything you could make in Treasuries.

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  60. Update to SLV Chart:

    http://screencast.com/t/XzpRbXXmm

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  61. Cramer was telling people to buy GOLD last night.
    I knew then it was the top,lol.

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  62. Trader Lady, that was what I was reading everywhere, buy, buy buy, so I bought puts in GLD and SLV. :)

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  63. Very high first half hour volumes suggest range extension of first hour 1259-1267 range today - roughly 2x the size of the range or more. That means stats say we are looking at about 1250 ES as a target to the downside or 1275 or so if we go the upside.

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  64. GDX -3.26 ..was really a "bear kiss" yesterday..a beautiful day :-)

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  65. holy banana, bad economic news everywhere

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  66. I need some advice. Should I sell my July SLV 35 Puts and buy SLV Aug 35 Puts?

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  67. if this is the start of the intermediate decline and this is a left translated daily cycle then it should decline for about 12 to 15 more days so your July puts should be fine

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  68. Gary, thanks. Much appreciated

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  69. Thanks Gary! You were calling it yesterday on the perma bulls crying. :)

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  70. I'm not selling my July's yet.

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  71. The final duel http://bit.ly/mqqajs :-)

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  72. Gary,

    $1511 would constitute a failed daily cycle, correct?

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  73. Gary,
    Bought some GDX puts with you're HUI call yesterday, Mahalo. Up over 50% this AM.

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  74. I could use some help: I will be on business in Italy in September. In the States I use a data stick that connects my laptop to my cell phone carrier for internet access so I can stay on top of things and trade. Does anyone know of such thing in Europe? Any company someone here can recommend? How can I connect to cell phone waves there on my own current laptop?

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  75. Monster August Gold futures volume this morning. I'm still holding my August Gold shorts from 1542 from 2-3 weeks back. I think this leg down is the real thing. 1511 should fall later on today or early tomorrow.

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  76. DG
    http://www.tim.it/consumer/o123922/promozione.do

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  77. DG, I have one such internet stick for my laptop in Ireland. I imagine any mobile phone shop in Italy will be able to sell you also

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  78. After weeks of misery with them, my SLV Puts have finally turned green today :o)

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  79. Eric,

    Yeah volume is high August gold, still short at 1538 couple weeks back.

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  80. This comment has been removed by the author.

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  81. Update to SPX Daily Chart 1247 ish :


    http://screencast.com/t/tv4UCiEg

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  82. Gann,
    Thanks for sending along the updated SLV chart. Now I follow why you dumped ZSL. And to me it cofirms again why Garys cycle work is so priceless. You do a wonderful job with charts by pointing out things I never came close to seeing, but I think it also illustrates how TA only tells part of the story. Mostly here I think I`m kind of having the AHA! moment and thinking out loud with my fingertips. :)

    Something else that has ocurred to me is your charting often shows the other side of the story and I think continually reminds me of how precarious this whole affair is. Excellent as fair as `Stay on your toes!` and take nothing for granted! Thanks again.

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  83. THX

    This could be a start of another decline into next week for SLV.but i am happy with my Scalp on ZSL.

    I had 15k long ZSL @ 17.28 sold this morning for a great profit.now waiting to position my self Long, Should Silver and SPX Selloff Hard in the next few days .

    Goodluck

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  84. Is this chart good? thx!

    http://stockcharts.com/h-sc/ui?s=SH&p=D&yr=1&mn=0&dy=0&id=p91302804117

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  85. Nice trade Gann360...well done!

    Guys, do you think that we could have a period of Gold down, stocks up as we had in January 2011?
    I cannot remember what was happening in January for the DX...

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  86. Outstanding trade! Good for you. Is your gut feeling that PMs will continue to correct? Thanks again.

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  87. Gary-
    We had a failed intermediate cycle last year in July 2010 when SPX broke the Feb 2010 intermediate low, correct? But, we were able to regain the highs and keep rallying into May 2011. Was this due to the Transports not confirming that intermediate low break? Looking at the TRANS, we are actually quite a ways from the approx 4900 intermediate cycle low.


    Thx

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  88. Éamonn "bad economic news everywhere"

    This reminds me of a study about 20 years ago that demonstrated how companies clump their bad news in order to hammer their own stock price so that their options (the officers) get repriced, or set low. And, with that out of the way, smooth sailing ahead. I think if the floodgates open on bad news (the kind which impacts the markets) it's because the smart money is OUT and wants to get the decline in. The added bonus this time will be setting the stage (or making the case) for QE3. Fools...

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  89. Gary,
    I read you talking about failed daily cycles. Could you explain to me what exactly it is and how it impacts everything? Thanks...

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  90. so silver doesn't want to go below 35

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  91. Patience! Geez - down 4.5% before noon isn't enough, huh?

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  92. It could continue to Correct.but i will wait and see if it does.

    But, as Gary has pointed out, You dont wanna get Caught on the wrong side of this Monster.
    should it continue to correct, Great , get ready to go long , when the Time is Right.

    Remember Patients is the name of this Game.

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  93. Gann and or Alex,

    would it not be better to short AGQ rather than go long ZSL for short play on silver? That way the cantango works in your favor.

    Rgds,

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  94. True Strength Index still below 0 on SLV and downward trendline still intact. Stochastics also rolling over.

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  95. gary, really an excellent job. you have helped my trading so much. is there any book or something for learning this cycle analysis that you do? take care greg

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  96. you dont have to Short Silver ,Via an Ultra.(2x) You can also Short Via a Single (1x )

    Sure the Gains .are not the Same, But ,Nor are the Loses .

    as i stated .i am now in Cash

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  97. MBS,
    I think last year was a combination of a couple of things. First we needed to consolidate the gigantic move out of the 09 bottom. It's not unusual to have a failed intermediate cycle in the first year of a cyclical bull market as that consolidation runs its course.

    Second; the unforeseen catastrophe with the BP oil spill probably triggered a more severe move down than would have happened naturally.

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  98. You can also short silver futures.

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  99. Quite the reversal today...
    I'm surprised that a few tech stocks are in the green.

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  100. A weekly MACD cross in Gold today.

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  101. Hiyo Silver! Drop one more buck...please?

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  102. Yes the gap down was too large on the QQQ. I'm sure the hedgies are going to try and fill that gap.

    For those brave souls, that would be the spot to sell short,ias the hedge funds will exit longs once the gap is filled.

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  103. Evrything gapped down Gary, SPY, SLV, GLD, you figure the same for those as well?

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  104. Cool_Looser, shoot pimaCanyon an email if you want any good explanations of cycle analysis. If you subscribe, see Swing Low and Swing Low on Terminology page under Charts and Documents.

    It sort of amounts to basic candlestick logic. Kind of anyways.

    Failed daily cycle means momentum is to the downside. The Swing High occurred before the middle of the daily cycle which runs about 1 month on average. Sooner than average means weaker than average on average.
    Your question is more intermediate in nature; ie, there’s a lot more too it.

    Hope this helps. Not sure everyone would agree with me.

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  105. I don't know about precious metals. They are at the top of their trading range just now beginning an intermediate decline. Stocks are already halfway into their decline.

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  106. SPX 10Min Gained the 20SMA but the SLV 10 Min Did not.

    Anyways i may Scalp Should the SLV 10 Min Chart setup. This would be the Possible Setup: Careful

    http://screencast.com/t/X7s0ttXEWt

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  107. Gann,
    Honestly, do you really make, and more importantly keep, any long-term money with these short-term scalps?

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  108. In every other intermediate cycle of this C-wave a daily close below the lower trendline never recovers. If this is the case with this intermediate cycle, if we close below 1525 today we should continue lower from here.

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  109. Gann,

    I think you would have been better off just holding your ZSL until days end.

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  110. Yup, gap is closed on QQQ, time to short?

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  111. Gary ,We all have different Styles.

    I do make Money.I do this for a Living,I have been doing this for 20 Years .My 10Min Scalping Size is Not the Same as My Swing Trading Size.

    But they are Big enough that a .15 cent Move is 2k Gain, in Possible Minutes..

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  112. Just curious.
    A lot of people try to day trade but very few actually making money at it.

    Just wondering if you had actually checked your results over the last couple years to see if you were really making money.

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  113. Interesting how the S&P tagged teh 200 day again and bounced up. Kind of feels like once that 200 day level gives way all hell will break loose

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  114. Gary,
    On my daytrades, I have made money on all but 3 transactions since January.
    The amounts aren't huge but it all adds up.
    Besides, I only found your site in March... Since then I've reduced my daytrading but still jump on when all my indicators line up for "living expenses" income.

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  115. Gary,

    Its all your fault I dont daytrade anymore!!!

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  116. Check results...
    Imagine that?!#
    Maybe Hulbert can learn something.

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  117. Gary this was my Setup for the SLV 10Min Scalp

    http://screencast.com/t/LYWgnXULDId

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  118. I don't have your bankroll Gann, good move there.

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  119. $.15 is fine, but what you do if it costs you a $1.50 because you missed the move?

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  120. It is all part of a big cylce. Sometimes that cycles are very long. Sometimes the cycles are very short. If you keep your patience you can exploit the benefits of trading the dynamics of both or all ends of the trading range timeframes.

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  121. to: DG

    Recently went to Zermatt with Gary. Via Zurich, Florence. I have a DROID
    Global 2{ phone has sim card] which has its own WI-FI site
    which can be used internationally. You pay for both data, separte charge voice. Must make arrangements by phone in advance. I have Verizon in US, their relationships with Vodaphone were great as I stayed connected on the train
    from Zurich to Florence etc. rates are pro rated. Zermatt coverage was intermittent, however, I knew I would be dinning with Gary.

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  122. I took a position in TWM a few minutes ago. Looking at the Russell 2000, which has been relatively weak, it is close to filling its gap this morning. Simply placing a bet here that the weakness is a trend and not a one day event.

    There is a close stop on TWM below 43.65, and with the Russell having a ton of overhead supply in the form of a well defined H&S, my reason for taking this trade is the high reward to risk ratio. If stopped out, TWM drops 4%, but if the neckline breaks and we play out a deflationary event, there is potential of 25-30% gain if the H&S pattern plays out, which is a logical target in such an event.

    I'm risking 1% of portfolio on this trade.

    Also holding
    EUO (2% risk on portfolio)
    SLV OCT 32 Puts (1.5% risk on portfolio).

    For comparison sake, at signs of a d-wave bottom in gold, I will position myself 50-65% invested with opening positions, and will layer in toward 100% invested. Currently I'm appx 23% invested.

    fc

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  123. Apple will generate some $6MM in sales per employee. Greece will generate some $30,000 per citizen.

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  124. Greece’s GDP is about $330 billion .One little tech company AAPL in one little town called Cupertino, California, will generate close to $150 billion in 2012.

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  125. on a good close above the 20SMA & Big red Candle,,,i would Cut my Losses.as i stated previously.

    Scalping is an art, which was Taught to me by a Master Scalper,He Taught me Gann and the Art of Quick Scalping.

    if and only if , the setup is there, i would of taken a Bigger Position, if we were ,lets say .at the top of a channel and Hiting the 20 SMA on the Ten minute for the first time and another Moving average say the 200 sma on the 60min or 5 min chart ,all at the same time..along with a 7 count or multiples of .

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  126. Gann,
    If I get down to the T&C Islands, I'm pulling a chair next to you for a week.

    ReplyDelete
  127. Gary,
    I would love to be in a cash position where I could just garner the information from your analysis, make periodic trades and do very little daytrading. A couple of years will hopefully get me there so you can't retire until 2014 mmmkay?

    ReplyDelete
  128. Losses are always going to be a part of Trading, As long as you Cut them Early,You should be Fine,

    as you pointed out, Rockie Trader holds on to losses ,and sells winners to quickly.

    that is a recipy for bisaster. it took me years to Control my emotions and Patients...to be able to make money..

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  129. Mr M,

    I would like to pull a chair next to Gary and pick his brain so I can learn quicker, just in case he retires soon.

    ReplyDelete
  130. Gann,

    You How do you control your Patients? I hope you dont torture them...loll ;)

    ReplyDelete
  131. Gann,
    I guess what I'm asking is do you think you will make more money trying to scoop up $.15 winners instead of just holding through a daily cycle, which in Silver's case could be a $5-$10 move?

    ReplyDelete
  132. William,
    I'd love to sit with Gary as well to understand the cycles analysis better but I'm afraid he'll make me lift weights..

    ReplyDelete
  133. Bought some QQQ Aug puts when it hit 54.80.

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  134. Gann,
    Well your sure driving it home now! More power to you and thanks for sharing with us.

    ReplyDelete
  135. Gann,


    Thanks for the chart. What is the the number as of right now that needs to hold? I can't tell from your numbers on the side of the chart which one is which. Thanks much!

    ReplyDelete
  136. Gary,

    Do you expect Gold to have 2 short daily cycles left or 1 extended daily cycle to reach the intermediate low? I know you say that gold's intermediate cycle keeps stretching, and usually comes in at 25 weeks. What was the longest intermediate gold cycle that you have seen?

    ReplyDelete
  137. IWM came within .05 of filling its morning gap, and has backed off appx .5%. Let's see whether it has the muster to make a move higher from here. It would take some serious short covering/committment of longs to push it through. i just don't think that many traders were short going into this move, but its possible that new shorts could be jittery and cover into any strength here.

    Fun game! i out the odds of breaking past yesterdays high on the IWM at appx 30%.

    fc

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  138. SLV: Until silver goes to $28, Cramer is not a backer of silver. He still likes gold.

    ReplyDelete
  139. Mr M,

    Im a bodybuilder so I would make Gary lift weights...lol

    ReplyDelete
  140. 86,

    I couldnt resist, that was like the 3rd time...lol

    ReplyDelete
  141. Anyone else take that QQQ short on the gap fill?

    Gary you would be an excellent daytrader!!

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  142. William,
    I was laughing til I had tears! I needed that!

    Mr M,
    the weights would be preferable to making you climb the rocks! Or using you for a punching bag.

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  143. The primary pressure behind the last 24 hour reversal in the gold market is the announcement of a release of 90 million barrels of oil from the strategic oil reserves and the poor work report released this morning in USA."But, as a good friend pointed out to me today, why did Obama wait until the price of oil had already fallen 22% from its recent high around $115 per barrel? How can there be a "shortage" if the price has already dropped like that without the SPR supply? It tells me that the Government wants commodities prices even lower in order to promote the appearance of no price inflation for the purpose of justifying the next round money printing "

    ReplyDelete
  144. William,
    Yesterday I took out one half of a beam in the basement and as I single handedly brought it down, I felt like Gary in a competition.
    I think it weighs 100lbs....

    ReplyDelete
  145. Gann,

    Im suprised you didnt take that QQQ short on the gap fill.

    ReplyDelete
  146. FC, I took the trade with you on TWM.
    THX! Kerry

    ReplyDelete
  147. MrMiyagi, you've gotta post pics of all your work down there. Sounds like things are moving along nicely!

    ReplyDelete
  148. 86,

    Glad I could make ya get a good laugh...now im rolling thinking about it...lol

    Mr, M

    lol...Gary could lift that 100lb. basement joist with one arm, even his bad side!

    ReplyDelete
  149. Mr M, you should design it to look like the interior of Ft Knox, and fill it with gold bars.

    ReplyDelete
  150. Mr M,

    Im doing my whole house over single handedly (actually single leggedly, im an amputee from motorcycle accident), well actually my wife is clean up crew. I do framing, electric, plumbing, sheetrock, paint, everything.

    ReplyDelete
  151. William,
    had an order in @ 54.80 on the way up and chickened out a few cents early. Got to thinking I`m extended enough and really just trying to pick up a few gains along the way to IT low. Yeah, maybe play it a little safer. Like Gary said, if half the move is gone in stocks....... I guess makes more sense to me to try to play a more full move. I read something by Doug Casey once that has always stuck with me but the execution is a lot tougher than it sounds. His point was; most people try to make 10% on 100% of their money, where as he tries to make 100% on 10% of his money. That`s an Exact ringer for waiting for the IT low.

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  152. Thank you to the several people who responded about my "data stick in Italy" question.

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  153. Gann,

    You see, if you had better control over those damn "Patients" they would have let you hold onto ZSL alittle longer! LOL ;)

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  154. 86,

    I hear you, couldnt be more true.

    Doug Casey said the other day he sees a major correction coming in gold also.

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  155. William,
    Your harder than woodpecker lips Man! That`s really amazing. You have a great attitude and I`m glad your here.

    ReplyDelete
  156. William

    Yeah , you Can't dance at every wedding right.lol ?

    Just got back from lunch,Wow nice fall on Silver .....I will now wait for the next setup...

    ReplyDelete
  157. Did you ever listen to any of his interviews? There are some on youtube. He really is a sharp cat!

    ReplyDelete
  158. 86,

    loll...woodpecker lips, not nails??? LOLLL your crazy! Thats good, I like that one.

    ReplyDelete
  159. So what? Sell off for the rest of the session?

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  160. Both Gold and GLD trading below the 50 dma. :)

    The flood gate is WIDE open now.

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  161. Gann,

    Lunch?? Dont you know that we dont eat here at Smart Money, we all starve until gold reaches its intermediate cycle bottom!!

    ReplyDelete
  162. its "you're crazy", not "your crazy"

    ReplyDelete
  163. GLD 120Min Chart Bearish Backtest, wish i would of seen this This Morning!

    http://screencast.com/t/FABbrZHCxDf

    ReplyDelete
  164. I think all Gold investors are crazy, thats why gold goes from 1577 to 1462 in 4 days...lol

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  165. My gold system went short today at 1522.

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  166. William,
    you need a break brother! Take two of these and call me back in ten;

    http://www.youtube.com/watch?v=nGeKSiCQkPw

    ReplyDelete
  167. 86,

    That dog was really talking.


    Veronica,

    My system told me to short gold at 1550!

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  168. Gold is going to break that 1511 level today.

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  169. Wow look at Silver ,,, Damn that 20SMA hIT ON THE 10mIN WAS pretty much the High of the Bounce and now new lows,,,,

    ReplyDelete
  170. DG,

    You say silver will probably tank hard for more than a few days. Any guesses as to time-frames and targets? Just guesses, thanks!

    ReplyDelete
  171. Anyone adding to shorts when gold crosses $1511?

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  172. William, your system must be better than mine:)

    ReplyDelete
  173. Gold MACD crossover, True Strength Index back below 0, stochastics rollover, most likely going to close below the lower trendline and 50DMA....why not short here and forget about waiting until it breaks 1511.

    ReplyDelete
  174. Veronica,

    I really wish you would tell us all what your system is!! Dont you want to help your fellow traders make money too, I thought we were all like one big family!!

    ReplyDelete
  175. bullion trader,
    The average duration of a daily cycle in gold/silver is 20 to 25 days. Today is day eight.

    ReplyDelete
  176. They are really throwing the kitchen sink at spy.

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  177. I think the oil being released from the strategic reserve occuring NOW is to give the commodities correction a *nudge* in the right (down) direction. Commodities absolutely must correct before The Bernank can start the next phase of dollar destruction.

    ReplyDelete
  178. WTF Just happened here, why the Pop?

    stepped out for 15 minutes

    ReplyDelete

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