Thanks for the update. May I ask, is the performance of the miners still within the bounds of your current model or are they warning you of something amiss?
I remain unconvinced as to the value of buying miners. Buying a ton of DGP/GLD makes sense. I posted last week that we might have a day like this. My account is down marginally because I am all in DGP. I am NOT saying miners won't go up and I am NOT saying they will not outperform, but I believe trading is about looking at the upside and the downside, and GLD/DGP to me has no downside whereas the miners may or may not. If I were as loaded with GDX and GDXJ as I am with DGP I'd be having an unhappy day. Given how fragile the stock market looks and all the credit problems flying around I'd rather own gold than a share of a business---any business. Just my take on the miner/GLD question.
Directions from a subscriber on how to set up phone notification any time I tweet. Which the website does automatically anytime anything is posted.
"I am now subscribed to your twitter feed, but in an alternative way to tweetymail. I will get SMS (text) messages to my cell phone. Although my twitter account "follows" many people, I am able to have just the tweets from garysavage1 get texted to my cell phone.
All I had to do was type
follow garysavage1
and send that text message to 40404. This tells twitter to send all tweets from garysavage1 to my cell phone. You don't even have to have a twitter account, so anyone can do this. International subscribers will have to use a different code. Please refer them to your twitter page: http://twitter.com/#!/garysavage1 and have them touch the link that says "Text follow garysavage1 to your carrier's shortcode" I hope this is useful info. It was inspired by your blurb on your welcome email which talks about tweetymail."
As I mentioned yesterday also in agreement with you being I am heavy DGP also and no miners...Brian mentioned that he thought it was worth it to be in miners because they are up 30% and DGP less, maybe you can point out for me how the miners are up 30% because I dont see it.
Elaine: A good rule of thumb is not to let a gain turn into a loss. That forces discipline, and if you had a decent gain that is back to break-even it may be because something has changed.
I'm positioned more aggressively with miners versus just gold and DGP. Right now I'm actually very light and have been since 10 days ago on that gap up surge. I will be looking to get heavy here again soon.
With where gold is right now relative to the miners, they are actually a lot less riskier than you'd think. Definitely if somehow it turns out we are out of Gold's C-wave, then the miners are going to be punished but I, as you and most everyone here, don't believe that to be the case.
We will also get to see a test of the "avoid broken parabolas" idea. Does silver gets crushed this DC or does it decline more normally (maybe 2-3 X gold's decline). It'll be interesting to watch. I am out of AGQ as of this morning waiting to see what happens.
DG, I agree with you that miners are less of a one-way bet than GLD. Here's how I see the odds;
Gold up hard, market up hard, miners up hard. Gold up hard, market flat, miners up or flat. Gold up hard, market tanks, miners hold or down. Gold flat, market down, miners down. Gold down, market up, miners down.... Gold down, market down, miners down hard. Seems like a weak hand to me...
I wish I could prove this relationship with a graph. Any technicians out there who could do this?
Although, I will say this, I do believe that if there were to look for a potential out-weighted move in regards to the gold bull, miners would be the place to be... but with a lot of volatility.
Is this the beginning of the daily cycle correction or is there more to this (gold and the miner's retreat) than I think? It looks like things are doing what they are supposed to do - am I wrong?
But the miners also topped way before gold...which means gold will still be rallying when miners begin their descent into a D-wave....so it all balances out :)
A recent SMT forecast posited HUI running from 600-800 or 600-900 at the C-top. This would be approx. +33% or +50% in HUI, which NUGT would amplify to +66% or +100%.
If GLD runs up 25%, then DGP gets +50%.
If HUI underperforms this model and only *keeps up* with GLD's 25% rise then you will not lose versus gold.
The risk must be then the possibility that HUI will not even *keep up* with GLD, let alone outperform or rocket-blast.
How much is that risk, that miners will not even *keep pace* with gold, let alone outperform? If they are extremely likely to at least keep up for this season, then the risk may be worth taking because of the potential sky-high reward.
AAAHHH, didnt mean to say GDP ( Gross Domestic Product) :)
Meant to say my miners are still currently up 35% and DGP is only up 17% off lows. So the pullback doesnt hurt as much if you look at your gains , not your one-2-3 day loss.
Those daily losses will be back soon, OR , you could sell and will get in again -( Higher or lower ) BUT while still holding your 35% gains now :)
The reason you would rather be heavy DGP with no miners is because you feel that you have a better sense of where gold is going (whether up or down), but dont feel that with the miners...its that simple...am I right?
Alex: So just buy more DGP. If you'd by $50,000 of miners buy $75,000 of DGP. Then at least you will win if gold goes up and you don't have to pick the "right" miners. Some are down and many are up less...and the decline is only one day old so far! Let's see what happens over the next week.
"When the Miners top" and we see maybe a large sell off candle ...You could be in DGP or GLD or AGQ and say to yourself " I'm selling 1/2 now and I may have 1 or 2 more days to sell , before this tops."
Sounds like a plan LATER ON, now its the Miners for me.
WW: Not quite. People are bullish on the miners BECAUSE they are bullish on gold (and for other reasons), but gold is the driver. Miners are simply one step removed, as we saw in 2008. And don;t say ""that can;t happen again" because it can and probably will---I just don't know when. Much of what is happening these days has little historical precedence. If gold goes up, gold will go up, and the miners will only very likely go up.
I agree the next decline will tell a tale to what is the best reward/risk investment...I tend to agree that DGP and like will be it perhaps. Interesting days ahead.
Would someone please tie the following into the discussion in a very simple way. I do not know how to ask my question - DGP is down only minimally, at least so far... what might be the interpretation?
Today's closing:
DGP 53.59 down .35 .065% NUGT 33.87 down 2.14 5.94% GLD 157.19 down .58 .37% GDX 58.48 down 1.81 3.00% GDXJ 36.80 down 1.66 4.32%
With sincerest thanks in advance and with kindest regards,
Not to beat on it, but John Doody's model says that relative to gold, the miners are as cheap as they've been two other times since 2001, and each time the miners gained well over 100%.
Also, miners are a diversifying asset because they are often negatively correlated to the market - negative betas - with very low correlation coefficients.
NEM beta = 0.52 ABX beta = 0.65 GG beta = 0.71
GDX 3 year R2 = 0.01 - no relationship to market moves
It looks like NUGT is down double GDX's decline for the day, as it's supposed to be. Why is GDX (miners) down so much more than gold today?
Gary wrote earlier that the miners were both discounting (anticipating) gold's upcoming mid-cycle decline and participating in the stock market sell-off, if I understood.
Farm Girl,
Thank you, that is helpful technical answer for my own question about the risk of miners merely not *keeping up* this cycle. Hopefully G won't change his mind about them either.
WW, I had a bunch of wiring that I got done as I AGAIN ran out of 2x4s to frame the ducts. So much for my math..
Ah let's see.... GLD puts? Nah.. gold might go down 40$ when the "deal is done" but I'm not playing that particular trade. So since I'm not in it, it will probably work out fine for you! If you really want to go in, go small, maybe 10 puts max? Don't spend all my money! The DCL might end up being a lot less than we're anticipating depending on circumstances, you might be better off passing on this trade and going in with more on the way up.
As I mentioned yesterday, UUP (US$ ETF) had a BB and bounced nicely today. Despite the heavy decrease in the US markets, neither SPY, QQQ or DIA had a BB crash although DIA kissed the line without breaking it. Chart-wise, this has taken a small amount of pressure of GLD's upwards trajectory, brought the market indexes closer to bottom where if it were to run its' course untouched, we'd have 3-5 days of lower prices. We shall see if the Big Boys put out a press releasing saying the "US Economy Needs Our Help! (by going further into debt)". In other news, I am going to mow my lawn now.
Someone on this blog mentioned trading in their Grandkids accounts. I was wondering if you could tell me if this is possible to trade in Gold/GLD for educational accounts for Grandkids or if there are other types of accounts for them such as gift accounts with a limit we can contribute tax free to them per year and just trade in the accounts for them?
Sure you can trade on behalf of your grandkids, just open a custodial account in their name and contribute up to the gift tax limits allowed by law. These are rather generous limits and your spouse could also contribute.
BUT careful, these are not 529 educational accounts, they do not come with tax breaks to you. Also once you make that gift to a minor, it becomes their asset, you are not allowed to withdraw or transfer the asset out.
Instead of "trading" you could also just open up an investment plan DIRECTLY with a mutual fund or a transfer agent for equities you like. You could also open a custodian account in Tocqueville Gold mutual fund for example, that has paid handsomely to buy & hold reinvestment holders.
Poly, Thanks for the information. Currently I have 6 young Grandkids ages of 12 - 18 months, that I would like to be able to put something aside for them next year that will grow in time. With Gold topping out possibly in 2016, I want to make sure whatever I put the funds into, they can easily move to something else down the line. I won't always be able to put funds aside in the future, however I figured if I took some GOLD profits from this year and planned for next year, I would be ready to set things up for them. Just trying to plan ahead. I don't mind gifting it to them, just have to figure out that the funds grown in their name, not mine (tax wise).
When planning for a decade and more out, don't forget the large blue chips. Sure we likely have a future bear market coming, but in the long run these industrials are super returners. Some quality names are paying 4%-6% dividends, which in real terms is an amazing return. Reinvested and compounded, a nice gift in 20 years. Quality equities are a very good inflation hedge too. Food for thought.
Poly, I need to investigate further how to set these types of funds up as I would need to get them started and managed. I opened up and initially funded educational accounts for my first two Grandsons for college so their parents could keep adding and I think they ended up using the funds already as the only thing I heard back on was the funds were losing money. So just want to make sure something is there for them in 10 years for the older grandkids and that what is invested, stays invested until needed.
I have Coverdale IRAs for my kids (for educational expenses). I've mostly traded gold and PM shares the past 2.5 years. At one time or another, I've had CEF, DGP, AGQ in them, along with various miners, GDXJ and SIL. From the bottom of '08 to now, the youngest daughter's account is up 668% in spite of today's shellacking. It was up quite a bit more at the end of April.
at ease, note the Coverdale limit PER CHILD is $2k from all sources. It's after tax, so all those earnings in my accounts are tax free. Good thing since the U she wants to attend next year is raising tuition 20% now AND another 20% next year.
Poly, when I first started them, the limit was $500 a year. For the youngest two kids, I will be able to cover 100% of their expenses for at least four years.
I truly did not see that coming. The 8-year low in gold (which resulted in some miners selling for less than 1/2 their book value) is how those accounts catapulted. I got almost all those gains pre-Gary, btw...
Obviously more left in this bull, but when I see typical 4 year programs costing $200k per child today, I know a significant annual contribution is required just to get close, even with great returns.
Fortunately, the college sophomore is at a state institution, and the last one has designs on Univ of Wash. We'll see...
Hard to believe how cheap my own degree was compared to the job/career I have versus the incredible expense and dearth of jobs for today's youth. I'm surprised there hasn't been a revolt amongst the young, but I guess that what game machines and iPhones help suppress.
From Harvey Organ tonight Good evening Ladies and Gentlemen:
Gold closed today (at comex closing time) at $1615.00 down $1.60 from yesterday. Silver finished the day down 14 cents to $40.55. Today was a vintage gold and silver raid. I happened to have my computer on at work. London finished early today at 11 am and within seconds, the crooked bankers sold massive quantity of future gold and silver contracts pulling the precious metals into the loss column after being up in the physical phase of the day. As I pointed out to you yesterday, the modus operandi of the bankers is now to whack the precious metals the day after they exercise options as these holders received a futures contract but they have not yet decided whether to put down 100% of the money to take delivery or pitch to another future month. The bankers try to influence their decision. We have one more day of this and then we are off to the races.
Poly, the all time high in food stamps welfare is to keep people just fed enough that they don't organize. Give 'em peanuts while you give the elite trillions. Give 'em peanuts while you squash SS.
I still think the big goal of the budget fiasco is to generate enough fear to screw those on fixed incomes for another few years, via rammed-down-their throats SS curtailment. The fear factor is rising, and so with it, the political cover to do what they want to do.
Gold is just due for a daily cycle correction. It has to happen sooner or later. If the dollar is ready to rally then this seems like as good a time as any.
BTW the selling isn't from crooked bankers, just nervous longs.
Have to check with other son, as I know he puts away for his kids, so can't duplicate on the educational efforts. I just want to put money away for them, however they choose to use it, up to them.
I asked this last night--you may have missed it or it may be too complex of a question to answer in a blog post. Just wondering how a "currency crisis" or "mini crisis" (as referred to in a couple of your recent reports) would affect the average person (i.e. hyperinflation?/bank holidays? etc.)?
Doc is referring to the graph Gary showed in tonight's letter, sentimenttrader stuff. Doc sold his silver today. Like Gary he expects stocks to correct and does not believe that PMs will escape damage given the run they have had.
Given the tools available to add leverage these days, I do not believe miners justify the additional degree of risk. They are equities and will correlate with equity cycles. Just because they have a lower Beta than the broad market does not make them uncorrelated or negatively correlated to the broader equity market cycles.
Beta and other metrics measure day to day performance. What we need to measure is cycle to cycle performance. Very unlikely that miners will escape a left translated cycle decline in equities.
Traditionally investors used miners to express their bullish intent with PMs. However with the availability of ETFs and leveraged ETFs which directly invest in PMs, the risk of another dimension of uncertainty is probably unwarranted.
While the "Deal or No Deal" drama in the US is getting the attention, the real action is going to be in Europe as the ESSF stuff unravels. We may back to 3rd edition of Greek bailout #2 and this time the markets may not give the benefit of the doubt. Very likely we are going into the DX up PM up mode soon.
I did not say gold sentiment is at all-time highs. I noted that sentiment is at similar levels that has stopped all intermediate cycle rallies out of the 2008 low. It's amazing how quickly one's words can get morphed even when they are written down.
Keep an eye on the 20sma, it looks like gold loves to hop off that 20, unless things get panicky and we head for the 30sma. If hearts start popping out of peoples chests then the 50sma, but with a rally like we just had hearts will remain in chest.
Well I think I will be the brave soul that goes on record and says the dollar will surely rise, unless it decideds to tank. Gold will go up unless it decides to go down.
AKA..sign me up for the wait and see, no clue right now club.
The manufactured rally really put a stink into things I think....wondering how we would view things had that not occured.
WW, SLV August 35 or 36 puts for the next lottery? If the silver price holds into the open, might be worth checking out, it's easier for you on the east coast, I'm too tired to get up at 6am on the west side. Again, high risk, don't disown me, bla bla...
There are a lot of very smart folks on the same track as you explained regarding the miners. There are some more reasons that John Hussman has explained in his weekly letter.
Here is an excerpt from a long ago letter.
Not surprisingly, the combination of all of these is rare but extremely powerful. In the rare instances when 1) The rate of inflation has been higher than 6 months earlier, 2) Treasury bond yields have been lower than 6 months earlier, 3) the NAPM Purchasing Managers Index has been below 50, and 4) the Gold/XAU ratio has been above 4.0, the XAU has soared at an astounding rate of 123.63% annualized. In contrast, when none of these have been true, the XAU has plunged at -53.21% annualized. That's a gaping difference.
http://www.hussmanfunds.com/html/gold.htm
What we are seeing at the moment is a lot of folks that don't care for volatility and that is completely understandable.
Please accept my apologies if I mischaracterized your statements. I was trying to be purposely vague so as not to give away subscriber-only information, but I probably should have just quoted you directly.
Dont disown me but I already played the lottery before the close with the Aug GLD puts I mentioned to you earlier :) Lets see what happens my slanted eyed friend!
WW, Ah.. grasshopper... That's fine, if it goes down they both will but I'm thinking percentage-wise the SLV would return more. Next time the wife and I visit NYC (don't know when), your chauffeur can drive us around perhaps?
My one and only post - then back to the shadows. Economically, next year leading up to the election only contains bad news. Obama needs a very dramatic episode to hang on Repubs for the duration. Downgrade is inevitable, they want a villain and a smoking gun. They've been working on the narrative for the past couple of weeks, along with trial balloons (no $ in the coffers for Grandma) to gauge bullshit meters. No outcry in 6 o'clock news = pass. Dems vote down new House bill in Senate on Friday, play rope a dope and run the clock until their Senate bill comes up. But their version ends up too odious for Repubs and fractures the present fragile coalition like an egg. Shit hits fan on Tues. Market tanks, miners along for the ride big time. Outside reversal day for gold sometime next week?
Go long - Obama's ginormous balls, Machiavellian strategery, media as White House PR firm. QE3 in August at Jackson Hole in response to market devastation starts parabolic gold ascent.
How will I meet up with you if I am able to make it...remember I mentioned that I will be going for another surgey around that time, its not scheduled yet though, might have to wait?
The most my system has made on any one trade is approximately 120 dollars. I was waiting to sell some at 1640 since the system went to a buy at 1518, but lightened up a bit right now. It will surely rocket up now:)
I hate to say it but I didnt even know the "GUNKS" were that beautiful , and I am from the East coast! ( Maybe because we have the White Mts in N.H., also beautiful for hiking and skiing/snowboarding).
'I hate to say it', because those pics are awesome...I wish I had gone there before my lower back injury.
After being assisted with cycles for a yr now, I DO believe in their power at bottoms , and you can load up and ride the following move. RIGHT NOW , however, I have something else on my mind--Since cycles become left trans & right trans, turn on you and change etc...so WHERE ARE WE?
I have been thinking a parabolic move is ahead , THEREFORE I expected THIS MOVE off of the bottom to be stronger than ,say,last summer. So I am comparing MINERS 2010 to 2011...side by side. ( I am more involved in Miners at this point).
TODAY, I believe , will answer my question whether THIS move off the bottom is even as strong as last sumnmers. GDXJ-
open 2 charts in side by side tabs & compare for yourself. (click charts to enlarge).
http://www.screencast.com/t/meizPGKYrvj
http://www.screencast.com/t/5bPNBdeLEZ
Today could reveal weakness in the current move I.M.H.O.
I am NOT WORRIED , I just tend to trade more in varying mkts
Quantifiable Edges, a very good statistical resource like sentimentrader.com, has gone to a very rare maximum bullishness stance with a 5 out 5 one a one day outlook on equities, and a rare 4 out of 5 on a 3-day outlook. He can be early and subject you to drawdown along the way but is not often wrong.
Gary, I live in the Hudson Highlands, just south of the Gunks (which are only in NY BTW). If you plan a get-together, please let me know. I would really enjoy meeting up with you all.
Sophia, yes, very bullish stating that Wednesday's sell-off was extreme enough to trigger many studies suggesting reaction to the upside. He is usually out of the market, often early on these calls and scales into positions by 1/4s and is getting 3/4 invested.
Russell, Take note of a poster ' Andybuji' from last night, in this tread. He makes sense, but like a passing stock tip, do you bite and run with it or do you watch the action and be ready to adjust accordingly. I will have some triggers established going into next week, for sure.
Gary also, if you have some spare change (the place is expensive) you should stay at Mohonk Moutain House near the Gunks. It's an incredible please - feels like the hotel in "The Shining" but more adirondacky (if that's word). http://www.mohonk.com/
The only problem I have with Jason is that he only looks at statistical data. The problem is that we are in a period unlike any other time in history, with the possible exception of the Great Depression.
The guy at S&P who has the job to decide re US downgrade is probably more influential right now than the FED Chairman. Imagine the chain events that this will set off.
wild shot, look in the model portfolio link and you will find the entry levels.
My suggestion is to use your personal entry-level as a stop and not let your trade turned negative.
Let's look at reality here people the miners are falling viciously and gold hasn't even corrected yet. When gold does decide to correct the miners are going to take a real beating.
I think I would suggest everybody take their profits on mining positions immediately.
Actually, I prefer waiting for the result of the debt ceiling and sell into it, rather than tryimg to get long here....getting long Gold is probably an easier bet for the time being....
Gary and mr.T, other east-coasters, I am over in Scranton, PA. and can be in the Junk areas in 2 or so hours. Gary, if time allows you, maybe make a meeting for breakfast, lunch or dinner... Would be nice to have a chance to meet you, Gary, from your tracker-east followers...
I was waiting on the big gap on the miners + a little momentum because they get sucked down with equities. I'm willing to give it a chance thru today because we are still up on the trade. Lower than today and it's something bigger than a gap fill.
If this is a dollar backtest of the triangle then the big move is ahead. If the dollar breaks up into the triangle then the 3 year low is in for me and it was a dollar gap fill on the UUP chart.
I really think that the Treasuries should selloff more violently than the equities at this stage...If the US lose their AAA, you can bet the wizz that the Treasuries will take a decent beating
Looks like your going to have a little gathering of the subs at the Gunks...I cant believe how beautiful that place is and I didnt even know it was there!
I really have no idea how far down the miners will drop. We saw a wicked correction during it. The gold just consolidated.
Gold hasn't even begun to move down into its cycle low yet in the minors are already taking a beating. If stocks are moving down hard and gold starts to move down I really doubt that the miners are going to the diverge. It seems more likely they will intensify the correction once gold starts to drop.
I think the bottom for the dollar is in, looks very similar to 08, going to help gold correct and thats about it...then gold will continue to ignore the dollar and they will rally together.
I have to admit that I am a bit perturbed. I entered my positions early.....got what I believed is a strong hand, but now it looks like we are just going to trade in and out of miners. I can handle a draw down.... just not a change in trend. If I knew miners were to be traded, I would have just settled on a single gold position.
Moves like this leave only two options for the trader, either we're bidding or sitting on our hands, but selling this move is an emotional rookie mistake, IMO.
DG, yes. Duuude, to late for selling miners probably, possible to still short some GLD or futures here against your miners as partial hedge with a stop near highs 1620s, cover it when you see miners outperforming when they started being accumulated.
This action in the miners is not a whole lot different than any other. They're more volatile and we all knew it. One should use it to their advantage, or they'll get torn up.
Completely agree, Gary can't do everything for us. Just because you missed it, this was part of the comment only minutes ago (scroll up) that I was referring to:
"Gary:
...My suggestion is to use your personal entry-level as a stop and not let your trade turned negative.
Let's look at reality here people the miners are falling viciously and gold hasn't even corrected yet. When gold does decide to correct the miners are going to take a real beating.
I think I would suggest everybody take their profits on mining positions immediately."
WW, I don't know re DUST hedge - not sure how hedged you are or your overall exposure so hard to say ... GDX going for another gap fill at $54 is a possibility too ...
You're right, except the miners have already tipped their hand on direction (higher) with the last rally. And of course, proper sizing goes a long way to shaping how we view moves.
I'm not concerned in the least about a drawdown, but if I were too heavily invested I might feel every tick lower. :)
Well we all know that a daily cycle low looms ahead. The last year, miners have led the way lower, but gold always led the way higher.
http://screencast.com/t/affluence
I am positioned to take a draw down, but a recommend to sell or prepare to sell ahead of a daily cycle low should have been made a week ago. Too late to jump out now.
Folks I suggest that you do not let your mining positions turn into a loss.
Take a step back and look what has happened in the last two days. Gold has barely even moved yet the miners have corrected 7% and are threatening to move back below the 200 day moving average.
Don't fool yourself into thinking that the miners are going to bounce off of support levels. The miners are not going to stop dropping until gold finds a bottom. We're not even sure if gold has found the top yet.
At this rate if gold drops back down to tag the breakout level at 1578 the mining stocks could make new lows. There's no reason to ride that kind of a draw down.
Take your profits in mining stocks and look to buy when we get a sign that gold has finished its daily cycle correction.
May get a little tiny follow up bounce off the 10sma tomorrow, and possibly monday, then cracked over the head on debt ceiling crap monday night into tuesday.
Gary,
ReplyDeleteThanks for the update. May I ask, is the performance of the miners still within the bounds of your current model or are they warning you of something amiss?
.
ReplyDeleteRight now the miners are both discounting a coming daily cycle correction in gold and subject to the selling pressure coming off of the stock market.
ReplyDeleteThank you very much! Maybe they'll be early pulling out of the dive too
ReplyDeleteGary
ReplyDeleteCan you refresh the board on instructions to receive text updates when you make new posts
Thx
.
ReplyDeleteSF,
ReplyDeleteUnfortunately I have no idea how to tell you to receive text messaging. A subscriber sent me those directions and I have since deleted the e-mail.
Miners are already as cheap right now compared to gold as they were on July 5th.
ReplyDeleteSF,
ReplyDeleteSubscribe to Twitter and to garysavage1, have Twitter text you
I'll be glad to see some long shadow candles around 58.00 in GDX
ReplyDeleteI remain unconvinced as to the value of buying miners. Buying a ton of DGP/GLD makes sense. I posted last week that we might have a day like this. My account is down marginally because I am all in DGP. I am NOT saying miners won't go up and I am NOT saying they will not outperform, but I believe trading is about looking at the upside and the downside, and GLD/DGP to me has no downside whereas the miners may or may not. If I were as loaded with GDX and GDXJ as I am with DGP I'd be having an unhappy day. Given how fragile the stock market looks and all the credit problems flying around I'd rather own gold than a share of a business---any business. Just my take on the miner/GLD question.
ReplyDeleteDirections from a subscriber on how to set up phone notification any time I tweet. Which the website does automatically anytime anything is posted.
ReplyDelete"I am now subscribed to your twitter feed, but in an alternative way to tweetymail. I will get SMS (text) messages to my cell phone. Although my twitter account "follows" many people, I am able to have just the tweets from garysavage1 get texted to my cell phone.
All I had to do was type
follow garysavage1
and send that text message to 40404. This tells twitter to send all tweets from garysavage1 to my cell phone. You don't even have to have a twitter account, so anyone can do this. International subscribers will have to use a different code. Please refer them to your twitter page: http://twitter.com/#!/garysavage1 and have them touch the link that says "Text follow garysavage1 to your carrier's shortcode"
I hope this is useful info. It was inspired by your blurb on your welcome email which talks about tweetymail."
Gary --
ReplyDeleteIs there any statistical evidence of GDX and GDXJ acting as precursors of GLD moves?
This comment has been removed by the author.
ReplyDeleteDP,
ReplyDeleteSometimes they do and sometimes they don't.
DG,
ReplyDeleteAs I mentioned yesterday also in agreement with you being I am heavy DGP also and no miners...Brian mentioned that he thought it was worth it to be in miners because they are up 30% and DGP less, maybe you can point out for me how the miners are up 30% because I dont see it.
Gary,
ReplyDeleteDoesn't the price of oil effect the miners also?
William,
ReplyDeleteYes it impacts profit margins.
Gary,
ReplyDeleteIf we entered a few days after you, should we modify our stops to our own entry points?
Thank you.
Sure because they must use a ton of oil to run all their machinery.
ReplyDeleteElaine: A good rule of thumb is not to let a gain turn into a loss. That forces discipline, and if you had a decent gain that is back to break-even it may be because something has changed.
ReplyDeleteElaine,
ReplyDeleteSounds reasonable.
Do you think that today action in miners will intensify on rising debt limit? Gold doesn't even start the correction, so it might be severe...
ReplyDeleteDG,
ReplyDeleteI'm positioned more aggressively with miners versus just gold and DGP. Right now I'm actually very light and have been since 10 days ago on that gap up surge. I will be looking to get heavy here again soon.
With where gold is right now relative to the miners, they are actually a lot less riskier than you'd think. Definitely if somehow it turns out we are out of Gold's C-wave, then the miners are going to be punished but I, as you and most everyone here, don't believe that to be the case.
This comment has been removed by the author.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteWe will also get to see a test of the "avoid broken parabolas" idea. Does silver gets crushed this DC or does it decline more normally (maybe 2-3 X gold's decline). It'll be interesting to watch. I am out of AGQ as of this morning waiting to see what happens.
ReplyDeleteMiyagi,
ReplyDeleteDid you come out of the dungeon yet??
DG, I agree with you that miners are less of a one-way bet than GLD. Here's how I see the odds;
ReplyDeleteGold up hard, market up hard, miners up hard.
Gold up hard, market flat, miners up or flat.
Gold up hard, market tanks, miners hold or down.
Gold flat, market down, miners down. Gold down, market up, miners down.... Gold down, market down, miners down hard.
Seems like a weak hand to me...
I wish I could prove this relationship with a graph. Any technicians out there who could do this?
Although, I will say this, I do believe that if there were to look for a potential out-weighted move in regards to the gold bull, miners would be the place to be... but with a lot of volatility.
Fun mike Felix
ReplyDeleteThx for the info
Earlier today I noted...
ReplyDeleteI look at it this way. look at the miners and they bottomed Mid June, so they led the way up. and 3 examples
1) Exk STILL up 35% ( was over 50% before pullback)
2) SVM STILL up 35% (was 50% before pullback ..$8-$12))
3)AG STILL up 40% (was up $60% off bottom)
Gold was (July 1) $1480 + 10% = $1628 (today)
With DGP, it is
Bottom was roughly $45.19 + 17+ % = $53.20 (NOW)
so really todays pullback in Miners STILL beats GDP in current positions ( just not daily)
Mr. T
ReplyDeleteYou forgot...
Mr. T stops buying gold chains, hip hop industry stops buying gold chains, miners go out of business!
Is this the beginning of the daily cycle correction or is there more to this (gold and the miner's retreat) than I think? It looks like things are doing what they are supposed to do - am I wrong?
ReplyDeleteAlex,
ReplyDeleteBut the miners also topped way before gold...which means gold will still be rallying when miners begin their descent into a D-wave....so it all balances out :)
A recent SMT forecast posited HUI running from 600-800 or 600-900 at the C-top. This would be approx. +33% or +50% in HUI, which NUGT would amplify to +66% or +100%.
ReplyDeleteIf GLD runs up 25%, then DGP gets +50%.
If HUI underperforms this model and only *keeps up* with GLD's 25% rise then you will not lose versus gold.
The risk must be then the possibility that HUI will not even *keep up* with GLD, let alone outperform or rocket-blast.
How much is that risk, that miners will not even *keep pace* with gold, let alone outperform? If they are extremely likely to at least keep up for this season, then the risk may be worth taking because of the potential sky-high reward.
Miyagi,
ReplyDeleteI am thinking about buying some GLD Aug 153 puts for this Daily Cycle correction...what do you think, am I nuts?
AAAHHH, didnt mean to say GDP ( Gross Domestic Product) :)
ReplyDeleteMeant to say my miners are still currently up 35% and DGP is only up 17% off lows. So the pullback doesnt hurt as much if you look at your gains , not your one-2-3 day loss.
Those daily losses will be back soon, OR , you could sell and will get in again -( Higher or lower ) BUT while still holding your 35% gains now :)
DG,
ReplyDeleteThe reason you would rather be heavy DGP with no miners is because you feel that you have a better sense of where gold is going (whether up or down), but dont feel that with the miners...its that simple...am I right?
William
ReplyDeleteMaybe evens out...Maybe not??
If Miners make 120 % ( they already gained 50% on first leg up) , top out and you get out with 100%
-You get 100%
If DGP gains 75 % (its only gained 18% so far) and you sell after top for 60%
-you get 60%
Its all about the % gained...and where you get in and where you exit really :)
Alex,
ReplyDeleteAgain...if gold tops after the miners when this C-wave tops will you be up more then?
Alex,
ReplyDeleteOK..thanks for the response.
Alex: So just buy more DGP. If you'd by $50,000 of miners buy $75,000 of DGP. Then at least you will win if gold goes up and you don't have to pick the "right" miners. Some are down and many are up less...and the decline is only one day old so far! Let's see what happens over the next week.
ReplyDeleteBut William
ReplyDeleteIts a good point that
"When the Miners top" and we see maybe a large sell off candle ...You could be in DGP or GLD or AGQ and say to yourself " I'm selling 1/2 now and I may have 1 or 2 more days to sell , before this tops."
Sounds like a plan LATER ON, now its the Miners for me.
WW: Not quite. People are bullish on the miners BECAUSE they are bullish on gold (and for other reasons), but gold is the driver. Miners are simply one step removed, as we saw in 2008. And don;t say ""that can;t happen again" because it can and probably will---I just don't know when. Much of what is happening these days has little historical precedence. If gold goes up, gold will go up, and the miners will only very likely go up.
ReplyDeleteDG
ReplyDeleteyes , you could leverage DGP and have a nice gain indeed.
and I agree.."time will tell"
:)
DG,
ReplyDeleteYou basically agreed 100%...what do you mean not quite...lol??
Shalom B., or anyone else, what are the disadvantages of holding PHYS over GLD?
ReplyDeleteI agree the next decline will tell a tale to what is the best reward/risk investment...I tend to agree that DGP and like will be it perhaps. Interesting days ahead.
ReplyDeleteWould someone please tie the following into the discussion in a very simple way. I do not know how to ask my question - DGP is down only minimally, at least so far...
ReplyDeletewhat might be the interpretation?
Today's closing:
DGP 53.59 down .35 .065%
NUGT 33.87 down 2.14 5.94%
GLD 157.19 down .58 .37%
GDX 58.48 down 1.81 3.00%
GDXJ 36.80 down 1.66 4.32%
With sincerest thanks in advance and with kindest regards,
Rose
Not to beat on it, but John Doody's model says that relative to gold, the miners are as cheap as they've been two other times since 2001, and each time the miners gained well over 100%.
ReplyDeleteAlso, miners are a diversifying asset because they are often negatively correlated to the market - negative betas - with very low correlation coefficients.
NEM beta = 0.52
ABX beta = 0.65
GG beta = 0.71
GDX 3 year R2 = 0.01 - no relationship to market moves
Farmgirl,
ReplyDeleteThe top 10 are only up 6.6% YTD
Rose,
ReplyDeleteIt looks like NUGT is down double GDX's decline for the day, as it's supposed to be. Why is GDX (miners) down so much more than gold today?
Gary wrote earlier that the miners were both discounting (anticipating) gold's upcoming mid-cycle decline and participating in the stock market sell-off, if I understood.
Farm Girl,
Thank you, that is helpful technical answer for my own question about the risk of miners merely not *keeping up* this cycle. Hopefully G won't change his mind about them either.
dollar make a swing low today?
ReplyDeleteWW,
ReplyDeleteI had a bunch of wiring that I got done as I AGAIN ran out of 2x4s to frame the ducts. So much for my math..
Ah let's see.... GLD puts? Nah.. gold might go down 40$ when the "deal is done" but I'm not playing that particular trade. So since I'm not in it, it will probably work out fine for you!
If you really want to go in, go small, maybe 10 puts max? Don't spend all my money!
The DCL might end up being a lot less than we're anticipating depending on circumstances, you might be better off passing on this trade and going in with more on the way up.
Off topic, but anyone on here sail?
ReplyDeleteIf so, I have a few questions about boats. You can email me at cmtcmt [at] gmail.com. Real name is Mike.
As I mentioned yesterday, UUP (US$ ETF) had a BB and bounced nicely today.
ReplyDeleteDespite the heavy decrease in the US markets, neither SPY, QQQ or DIA had a BB crash although DIA kissed the line without breaking it.
Chart-wise, this has taken a small amount of pressure of GLD's upwards trajectory, brought the market indexes closer to bottom where if it were to run its' course untouched, we'd have 3-5 days of lower prices. We shall see if the Big Boys put out a press releasing saying the "US Economy Needs Our Help! (by going further into debt)".
In other news, I am going to mow my lawn now.
Mr M
ReplyDeleteYou can always use 2 x 4's. Best to always get 3-4 extra.
funmike,
ReplyDeleteThats what I do, I always buy more 2X4's...I have my very own little lumber yard now.
Trading Accounts for Grandkids?
ReplyDeleteSomeone on this blog mentioned trading in their Grandkids accounts.
I was wondering if you could tell me if this is possible to trade in Gold/GLD for educational accounts for Grandkids or if there are other types of accounts for them such as gift accounts with a limit we can contribute tax free to them per year and just trade in the accounts for them?
Eamonn, you were worried about US debt or the USD. I understand that you can trade in Canadian funds which might be safer.
ReplyDeleteMrMyagi may be able to help with something in place of GLD. I know there are plenty of Canadian miners.
paste:
ReplyDeletehttp://www.zerohedge.com/news/es-volume-surges-close-33-billion-sale-hits-tape
at ease,
ReplyDeleteSure you can trade on behalf of your grandkids, just open a custodial account in their name and contribute up to the gift tax limits allowed by law. These are rather generous limits and your spouse could also contribute.
BUT careful, these are not 529 educational accounts, they do not come with tax breaks to you. Also once you make that gift to a minor, it becomes their asset, you are not allowed to withdraw or transfer the asset out.
Instead of "trading" you could also just open up an investment plan DIRECTLY with a mutual fund or a transfer agent for equities you like. You could also open a custodian account in Tocqueville Gold mutual fund for example, that has paid handsomely to buy & hold reinvestment holders.
Poly, Thanks for the information. Currently I have 6 young Grandkids ages of 12 - 18 months, that I would like to be able to put something aside for them next year that will grow in time. With Gold topping out possibly in 2016, I want to make sure whatever I put the funds into, they can easily move to something else down the line. I won't always be able to put funds aside in the future, however I figured if I took some GOLD profits from this year and planned for next year, I would be ready to set things up for them. Just trying to plan ahead. I don't mind gifting it to them, just have to figure out that the funds grown in their name, not mine (tax wise).
ReplyDeleteWhen planning for a decade and more out, don't forget the large blue chips. Sure we likely have a future bear market coming, but in the long run these industrials are super returners. Some quality names are paying 4%-6% dividends, which in real terms is an amazing return. Reinvested and compounded, a nice gift in 20 years. Quality equities are a very good inflation hedge too. Food for thought.
ReplyDeletePoly,
ReplyDeleteI need to investigate further how to set these types of funds up as I would need to get them started and managed. I opened up and initially funded educational accounts for my first two Grandsons for college so their parents could keep adding and I think they ended up using the funds already as the only thing I heard back on was the funds were losing money. So just want to make sure something is there for them in 10 years for the older grandkids and that what is invested, stays invested until needed.
at ease,
ReplyDeleteI have Coverdale IRAs for my kids (for educational expenses). I've mostly traded gold and PM shares the past 2.5 years. At one time or another, I've had CEF, DGP, AGQ in them, along with various miners, GDXJ and SIL. From the bottom of '08 to now, the youngest daughter's account is up 668% in spite of today's shellacking. It was up quite a bit more at the end of April.
at ease, note the Coverdale limit PER CHILD is $2k from all sources. It's after tax, so all those earnings in my accounts are tax free. Good thing since the U she wants to attend next year is raising tuition 20% now AND another 20% next year.
ReplyDeleteGood thing there's no inflation...
The education savings accounts are great, but the contribution limits per child a tiny.
ReplyDeletePoly, when I first started them, the limit was $500 a year. For the youngest two kids, I will be able to cover 100% of their expenses for at least four years.
ReplyDeleteI truly did not see that coming. The 8-year low in gold (which resulted in some miners selling for less than 1/2 their book value) is how those accounts catapulted. I got almost all those gains pre-Gary, btw...
Congrats Ben. Very impressive.
ReplyDeleteObviously more left in this bull, but when I see typical 4 year programs costing $200k per child today, I know a significant annual contribution is required just to get close, even with great returns.
Fortunately, the college sophomore is at a state institution, and the last one has designs on Univ of Wash. We'll see...
ReplyDeleteHard to believe how cheap my own degree was compared to the job/career I have versus the incredible expense and dearth of jobs for today's youth. I'm surprised there hasn't been a revolt amongst the young, but I guess that what game machines and iPhones help suppress.
We've lost our will to revolt, rather sad.
ReplyDeleteFrom Harvey Organ tonight
ReplyDeleteGood evening Ladies and Gentlemen:
Gold closed today (at comex closing time) at $1615.00 down $1.60 from yesterday. Silver finished the day down 14 cents to $40.55. Today was a vintage gold and silver raid. I happened to have my computer on at work. London finished early today at 11 am and within seconds, the crooked bankers sold massive quantity of future gold and silver contracts pulling the precious metals into the loss column after being up in the physical phase of the day. As I pointed out to you yesterday, the modus operandi of the bankers is now to whack the precious metals the day after they exercise options as these holders received a futures contract but they have not yet decided whether to put down 100% of the money to take delivery or pitch to another future month. The bankers try to influence their decision. We have one more day of this and then we are off to the races.
Poly, the all time high in food stamps welfare is to keep people just fed enough that they don't organize. Give 'em peanuts while you give the elite trillions. Give 'em peanuts while you squash SS.
ReplyDeleteI still think the big goal of the budget fiasco is to generate enough fear to screw those on fixed incomes for another few years, via rammed-down-their throats SS curtailment. The fear factor is rising, and so with it, the political cover to do what they want to do.
Gold Is for Investors, Miners Are for Traders
ReplyDeletehttp://seekingalpha.com/article/282253-gold-is-for-investors-miners-are-for-traders
Harvey is a kook :)
ReplyDeleteGold is just due for a daily cycle correction. It has to happen sooner or later. If the dollar is ready to rally then this seems like as good a time as any.
BTW the selling isn't from crooked bankers, just nervous longs.
Ben and Poly, So you say I can contribute up to $2k per year per child, with gains allowed due to trades?
ReplyDeleteHave to check with other son, as I know he puts away for his kids, so can't duplicate on the educational efforts. I just want to put money away for them, however they choose to use it, up to them.
ReplyDeleteGary,
ReplyDeleteAny chance of a bounce up before the daily cycle drop in gold?
I was surprised to see precious metals can now be traded in Fidelity IRAs.
ReplyDeleteAt Ease,
ReplyDeleteI'm not sure what you are asking me. Markets can do anything. We all should know that by now.
We don't even have a swing in gold yet, nor a trend line break. Until we do there is no confirmation of a cycle top other than weakness in the miners.
Gary, May I ask if you have conditions that would lead you to abandon the miners for the intermediate cycle? Thanks.
ReplyDeleteMy largest position will be gold but I will have some exposure to miners.
ReplyDeleteGary, you answered my question. Thank you
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteGary,
ReplyDeleteDoc has noted that gold sentiment is now at all-time highs, which is a very bearish indicator.
What do you make of this?
Gary,
ReplyDeleteI asked this last night--you may have missed it or it may be too complex of a question to answer in a blog post. Just wondering how a "currency crisis" or "mini crisis" (as referred to in a couple of your recent reports) would affect the average person (i.e. hyperinflation?/bank holidays? etc.)?
Thanks.
David: The Hulbert gold index is dead neutral; the Rydex exposure index is dead neutral, the public opinion index shows slightly too many bulls...??
ReplyDeleteDG:
ReplyDeleteDoc is referring to the graph Gary showed in tonight's letter, sentimenttrader stuff. Doc sold his silver today. Like Gary he expects stocks to correct and does not believe that PMs will escape damage given the run they have had.
Given the tools available to add leverage these days, I do not believe miners justify the additional degree of risk. They are equities and will correlate with equity cycles. Just because they have a lower Beta than the broad market does not make them uncorrelated or negatively correlated to the broader equity market cycles.
Beta and other metrics measure day to day performance. What we need to measure is cycle to cycle performance. Very unlikely that miners will escape a left translated cycle decline in equities.
Traditionally investors used miners to express their bullish intent with PMs. However with the availability of ETFs and leveraged ETFs which directly invest in PMs, the risk of another dimension of uncertainty is probably unwarranted.
While the "Deal or No Deal" drama in the US is getting the attention, the real action is going to be in Europe as the ESSF stuff unravels. We may back to 3rd edition of Greek bailout #2 and this time the markets may not give the benefit of the doubt. Very likely we are going into the DX up PM up mode soon.
I did not say gold sentiment is at all-time highs. I noted that sentiment is at similar levels that has stopped all intermediate cycle rallies out of the 2008 low. It's amazing how quickly one's words can get morphed even when they are written down.
ReplyDeleteKeep an eye on the 20sma, it looks like gold loves to hop off that 20, unless things get panicky and we head for the 30sma. If hearts start popping out of peoples chests then the 50sma, but with a rally like we just had hearts will remain in chest.
ReplyDeleteWell I think I will be the brave soul that goes on record and says the dollar will surely rise, unless it decideds to tank. Gold will go up unless it decides to go down.
ReplyDeleteAKA..sign me up for the wait and see, no clue right now club.
The manufactured rally really put a stink into things I think....wondering how we would view things had that not occured.
WW,
ReplyDeleteSLV August 35 or 36 puts for the next lottery? If the silver price holds into the open, might be worth checking out, it's easier for you on the east coast, I'm too tired to get up at 6am on the west side.
Again, high risk, don't disown me, bla bla...
Farm Girl,
ReplyDeleteThere are a lot of very smart folks on the same track as you explained regarding the miners. There are some more reasons that John Hussman has explained in his weekly letter.
Here is an excerpt from a long ago letter.
Not surprisingly, the combination of all of these is rare but extremely powerful. In the rare instances when 1) The rate of inflation has been higher than 6 months earlier, 2) Treasury bond yields have been lower than 6 months earlier, 3) the NAPM Purchasing Managers Index has been below 50, and 4) the Gold/XAU ratio has been above 4.0, the XAU has soared at an astounding rate of 123.63% annualized. In contrast, when none of these have been true, the XAU has plunged at -53.21% annualized. That's a gaping difference.
http://www.hussmanfunds.com/html/gold.htm
What we are seeing at the moment is a lot of folks that don't care for volatility and that is completely understandable.
What a market... I remember when Gary was saying that gold will break 1,000 dollars. Today it did 1628.80. What a truly amazing bull market!
ReplyDeleteDoc,
ReplyDeletePlease accept my apologies if I mischaracterized your statements. I was trying to be purposely vague so as not to give away subscriber-only information, but I probably should have just quoted you directly.
Miyagi,
ReplyDeleteDont disown me but I already played the lottery before the close with the Aug GLD puts I mentioned to you earlier :) Lets see what happens my slanted eyed friend!
My slanted eyed mentor that is. You are a true Miyagi!
ReplyDeleteMel Gibson would be very proud right now!
ReplyDeleteBrian is the you hang gliding?
ReplyDeleteWW,
ReplyDeleteAh.. grasshopper...
That's fine, if it goes down they both will but I'm thinking percentage-wise the SLV would return more.
Next time the wife and I visit NYC (don't know when), your chauffeur can drive us around perhaps?
yes
ReplyDeleteMiyagi,
ReplyDeleteI will be your chauffeur, and I will be glad to take you and the wife out to dinner! Danielsan will find a way to apply his gratitude, one day!
George,
ReplyDeleteA currency crisis would cause commodity prices to spike.
Brian,
ReplyDeleteWhere are you coming from...looks like your landing on the beach?
Gary,
ReplyDeleteHave you ever been to New York, or plan on it?
Kill Devil Hills
ReplyDeleteBrian,
ReplyDeleteYou are a brave soul.
Yes I've been to New York many times. I will be flying into Newark on September 12.
ReplyDeleteA bunch of us are going to the shawangunks for a two-week climbing trip.
Wow...thats in New Jersey? I never knew. Would I be able to come there and meet you and watch you guys climb?
ReplyDeleteWOW..thats really beautiful over there..I would love to hike there. I am going to have to go there one day for sure.
ReplyDeleteMy one and only post - then back to the shadows. Economically, next year leading up to the election only contains bad news. Obama needs a very dramatic episode to hang on Repubs for the duration. Downgrade is inevitable, they want a villain and a smoking gun. They've been working on the narrative for the past couple of weeks, along with trial balloons (no $ in the coffers for Grandma) to gauge bullshit meters. No outcry in 6 o'clock news = pass. Dems vote down new House bill in Senate on Friday, play rope a dope and run the clock until their Senate bill comes up. But their version ends up too odious for Repubs and fractures the present fragile coalition like an egg. Shit hits fan on Tues. Market tanks, miners along for the ride big time. Outside reversal day for gold sometime next week?
ReplyDeleteGo long - Obama's ginormous balls, Machiavellian strategery, media as White House PR firm. QE3 in August at Jackson Hole in response to market devastation starts parabolic gold ascent.
Why bother with the Tetons after you have been to Jersey!
ReplyDeleteThe "Gunk's" are right outside of New Paltz, New York. Sure you can come. I've never been there myself but it looks beautiful.
ReplyDeleteAndy,
ReplyDeleteWhy back to the shadows...stay for a while!
Gary,
ReplyDeleteHow will I meet up with you if I am able to make it...remember I mentioned that I will be going for another surgey around that time, its not scheduled yet though, might have to wait?
Remind me before I leave and I'll send you my phone number.
ReplyDeleteOk...will do! We can get that burrito after the climb :)
ReplyDeleteDoes Toby go on these trips?
ReplyDeleteGLD on BOW list.
ReplyDeleteThe only thing that I've found to have any predictive value is the SPYDER's. And that is often early as evidenced by the last signal.
ReplyDeleteI don't think watching GLD money flows is going to be worth the trouble.
The most my system has made on any one trade is approximately 120 dollars. I was waiting to sell some at 1640 since the system went to a buy at 1518, but lightened up a bit right now. It will surely rocket up now:)
ReplyDeleteI hate to say it but I didnt even know the "GUNKS" were that beautiful , and I am from the East coast! ( Maybe because we have the White Mts in N.H., also beautiful for hiking and skiing/snowboarding).
ReplyDelete'I hate to say it', because those pics are awesome...I wish I had gone there before my lower back injury.
BTW, the dollar has formed it's swing low this AM.
ReplyDeleteThanks v
ReplyDeleteI'm in on the $
After being assisted with cycles for a yr now, I DO believe in their power at bottoms , and you can load up and ride the following move. RIGHT NOW , however, I have something else on my mind--Since cycles become left trans & right trans, turn on you and change etc...so WHERE ARE WE?
ReplyDeleteI have been thinking a parabolic move is ahead , THEREFORE I expected THIS MOVE off of the bottom to be stronger than ,say,last summer. So I am comparing MINERS 2010 to 2011...side by side. ( I am more involved in Miners at this point).
TODAY, I believe , will answer my question whether THIS move off the bottom is even as strong as last sumnmers. GDXJ-
open 2 charts in side by side tabs & compare for yourself. (click charts to enlarge).
http://www.screencast.com/t/meizPGKYrvj
http://www.screencast.com/t/5bPNBdeLEZ
Today could reveal weakness in the current move I.M.H.O.
I am NOT WORRIED , I just tend to trade more in varying mkts
David,
ReplyDeleteGot it. Well, thanks for that. Anyway, I just didn't want folks to think I couldn't read a sentiment chart!
Gary
ReplyDeleteIf you don't have it for Toby, something to think about.
http://www.petinsurance.com/
A requirement for all spoiled dog and cats. My girlfriend has it and it pays for itself every year.
Oh and her dogs name is also Toby.
Quantifiable Edges, a very good statistical resource like sentimentrader.com, has gone to a very rare maximum bullishness stance with a 5 out 5 one a one day outlook on equities, and a rare 4 out of 5 on a 3-day outlook. He can be early and subject you to drawdown along the way but is not often wrong.
ReplyDeleteGold is holding up pretty well here in the face of the rallying dollar. Gonna be interesting to see what the miners do today.
ReplyDeleteWhat does it mean Michael? 5 out of 5 one day outlook?
ReplyDeleteDoes it mean that they are very bullish as of today?
This comment has been removed by the author.
ReplyDeleteAnybody know what is the GDX break even price?
ReplyDeleteWildshot,
ReplyDeleteIt's in the subscriber section on the premium site.
Gap fill on miners.
ReplyDeleteAny predictions re the SPY and Gold given the stalemate on the deficit fix at this late hour. Any equity put buyers? How will gold react?
ReplyDeleteGary, I live in the Hudson Highlands, just south of the Gunks (which are only in NY BTW). If you plan a get-together, please let me know. I would really enjoy meeting up with you all.
ReplyDeleteSophia, yes, very bullish stating that Wednesday's sell-off was extreme enough to trigger many studies suggesting reaction to the upside. He is usually out of the market, often early on these calls and scales into positions by 1/4s and is getting 3/4 invested.
ReplyDeleteRussell,
ReplyDeleteTake note of a poster ' Andybuji' from last night, in this tread. He makes sense, but like a passing stock tip, do you bite and run with it or do you watch the action and be ready to adjust accordingly.
I will have some triggers established going into next week, for sure.
"The entry level" number is what I am after as I did not buy GDX.
ReplyDeleteGary, could you post the GDX break even number on the sub site?
Gary also, if you have some spare change (the place is expensive) you should stay at Mohonk Moutain House near the Gunks. It's an incredible please - feels like the hotel in "The Shining" but more adirondacky (if that's word).
ReplyDeletehttp://www.mohonk.com/
Michael,
ReplyDeleteThanks for the info, will look at the website...
I agree that a lot of people are calling for 1260-1220 bottom but it might never come
The only problem I have with Jason is that he only looks at statistical data. The problem is that we are in a period unlike any other time in history, with the possible exception of the Great Depression.
ReplyDeleteThe guy at S&P who has the job to decide re US downgrade is probably more influential right now than the FED Chairman. Imagine the chain events that this will set off.
ReplyDeletewild shot,
ReplyDeletelook in the model portfolio link and you will find the entry levels.
My suggestion is to use your personal entry-level as a stop and not let your trade turned negative.
Let's look at reality here people the miners are falling viciously and gold hasn't even corrected yet. When gold does decide to correct the miners are going to take a real beating.
I think I would suggest everybody take their profits on mining positions immediately.
Actually, I prefer waiting for the result of the debt ceiling and sell into it, rather than tryimg to get long here....getting long Gold is probably an easier bet for the time being....
ReplyDeleteGary and mr.T, other east-coasters,
ReplyDeleteI am over in Scranton, PA. and can be in the Junk areas in 2 or so hours. Gary, if time allows you, maybe make a meeting for breakfast, lunch or dinner... Would be nice to have a chance to meet you, Gary, from your tracker-east followers...
Alex,
ReplyDeleteThanks for those charts. Likely the 50 gets taken out..sooner rather than later. Do you have an adding strategy?
GARY -
ReplyDeleteThanks, I took some profits on the miners. I don't read the boards usually, so please let us know via post when to reestablish. Thanks.
I was waiting on the big gap on the miners + a little momentum because they get sucked down with equities. I'm willing to give it a chance thru today because we are still up on the trade. Lower than today and it's something bigger than a gap fill.
ReplyDeleteI added 10% more shares to each of my positions, with bids for 20% more quite far below current prices in case traders want to puke 'em out.
ReplyDeleteAlso bidding for GPL but that one doesn't seem to want to work lower yet.
Perhaps I'll get filled on the rest of my orders later today or tomorrow.
If this is a dollar backtest of the triangle then the big move is ahead. If the dollar breaks up into the triangle then the 3 year low is in for me and it was a dollar gap fill on the UUP chart.
ReplyDeleteGary,
ReplyDeleteHow close do you think GDX could get from the mid-June bottom?
I really think that the Treasuries should selloff more violently than the equities at this stage...If the US lose their AAA, you can bet the wizz that the Treasuries will take a decent beating
ReplyDeleteGary,
ReplyDeleteLooks like your going to have a little gathering of the subs at the Gunks...I cant believe how beautiful that place is and I didnt even know it was there!
Wow Gary, you were so right about Silver!
ReplyDeleteI really have no idea how far down the miners will drop. We saw a wicked correction during it. The gold just consolidated.
ReplyDeleteGold hasn't even begun to move down into its cycle low yet in the minors are already taking a beating. If stocks are moving down hard and gold starts to move down I really doubt that the miners are going to the diverge. It seems more likely they will intensify the correction once gold starts to drop.
I think the bottom for the dollar is in, looks very similar to 08, going to help gold correct and thats about it...then gold will continue to ignore the dollar and they will rally together.
ReplyDeleteHeavy support at 1615, seeing many buyers here...if I were in miners I would take profits here above 1615
ReplyDeleteGary, Michael,
ReplyDeleteThere must be some news or rumors about a deal...the equity market is goimg up against all odds while the precious metals are weak....
Fainally took out 1615 support...now the miners are going to take a beating and a half.
ReplyDeletesold DIA at small profit---posted yesterday bought small amt near close.
ReplyDeleteStaying very defensive.
Sniff, I should have listened to you Michael, since your text, the NSQ is up 20 points!
ReplyDeleteHere's a great new interview with Jim Rogers. Says US won't default w/o debt ceiling increase, just a charade.
ReplyDeletehttp://www.thedailybell.com/2738/Jim-Rogers-Americas-the-Largest-Debtor-Nation-in-the-History-of-the-World-and-Its-Just-Getting-Worse
Gary, Model Portfolio remains unchanged even though you call for selling miners on the blog.
Using DUST as a hedge.
ReplyDeleteGary,
ReplyDeleteAre you still planning to hold GLD old turkey through the correction?
Okay, Selling 50% of my Position in my SILVER SLV,,,, Short Here and Banking $1.32.going to let the other Half Ride. :)
ReplyDeleteWolf,
ReplyDeleteSmart fella.
I have to admit that I am a bit perturbed. I entered my positions early.....got what I believed is a strong hand, but now it looks like we are just going to trade in and out of miners. I can handle a draw down.... just not a change in trend. If I knew miners were to be traded, I would have just settled on a single gold position.
ReplyDeleteDuuude,
ReplyDeleteDon't sweat it. :)
Moves like this leave only two options for the trader, either we're bidding or sitting on our hands, but selling this move is an emotional rookie mistake, IMO.
ReplyDeleteThanks SB.
ReplyDeleteMichael: Are you a subscriber at Quantifiable Edge?
ReplyDeleteSB,
ReplyDeleteThat is of course the move recommended by the blog owner here just moments ago, you realize.
DUUUDE,
ReplyDeleteUse these dips to buy if your not planning on trading in and out of miners...thats all:) Doubt there is a change in trend...just a hard correction.
Felix,
ReplyDeleteI didn't see where Gary recommended it, just in the subscriber letter than it was an option for those too heavily loaded.
Maybe I missed it, but Gary can't do everything for us. Only the cycles, the risk management is up to us. :)
DG, yes.
ReplyDeleteDuuude, to late for selling miners probably, possible to still short some GLD or futures here against your miners as partial hedge with a stop near highs 1620s, cover it when you see miners outperforming when they started being accumulated.
Gold will find support on the 10sma today, if we break then on with the suffering.
ReplyDeleteThis action in the miners is not a whole lot different than any other. They're more volatile and we all knew it. One should use it to their advantage, or they'll get torn up.
ReplyDeleteMichael,
ReplyDeleteDefinitely too late to sell miners now...may be better off taking DUST as a hedge, no?
SB,
ReplyDeleteCompletely agree, Gary can't do everything for us. Just because you missed it, this was part of the comment only minutes ago (scroll up) that I was referring to:
"Gary:
...My suggestion is to use your personal entry-level as a stop and not let your trade turned negative.
Let's look at reality here people the miners are falling viciously and gold hasn't even corrected yet. When gold does decide to correct the miners are going to take a real beating.
I think I would suggest everybody take their profits on mining positions immediately."
SB,
ReplyDeletebidding here is like catching a falling knife :)
I hope nobody is selling miners now...we will most likely see a small bounce tomorrow.
ReplyDeleteW2,
ReplyDeletethat's not a good point. People may have entered late and this move turns their position into loss. Definatelly not the best scenario.
Sophia,
ReplyDeleteYesterday was a 96% down volume day. It's not unusual to have some kind of a relief rally after that kind of intense selling pressure.
I have started to nibble.
ReplyDeleteI can weather a draw down if miners go lower.
James
High5,
ReplyDeleteRead the last paragraph in last night's report.
WW, I don't know re DUST hedge - not sure how hedged you are or your overall exposure so hard to say ... GDX going for another gap fill at $54 is a possibility too ...
ReplyDeleteIvanG,
ReplyDeleteYou're right, except the miners have already tipped their hand on direction (higher) with the last rally. And of course, proper sizing goes a long way to shaping how we view moves.
I'm not concerned in the least about a drawdown, but if I were too heavily invested I might feel every tick lower. :)
funmike,
ReplyDeleteThe model portfolio will continue to hold GLD through the correction.
My personal portfolio isn't the same as the model portfolio, but I am holding a percentage of GLD through the correction in my personal portfolio.
Ivan,
ReplyDeleteIm not refering to those who bought now! And I dont believe Gary was either when He said "Sell immediately"
Well we all know that a daily cycle low looms ahead. The last year, miners have led the way lower, but gold always led the way higher.
ReplyDeletehttp://screencast.com/t/affluence
I am positioned to take a draw down, but a recommend to sell or prepare to sell ahead of a daily cycle low should have been made a week ago. Too late to jump out now.
Ivan,
ReplyDeleteI was refering to those who bought on Gary's signal.
I think this settles the debate "Is it the news or the cycles?" News would favor gold to rise, Cycles are in timing band for decline
ReplyDeleteRussell,
ReplyDeleteNews on a debt ceiling deal will make gold puke a bit more.
I'm hoping for another day like this tomorrow in order to get some super sweet fills. :)
ReplyDeleteW2,
ReplyDeletethose who bought then now see 75% of the profit wiped out. What would you do :)
Interview video with Casey Research Chief Economist Bud Conrad: Money is not worth the paper it's not printed on.
ReplyDeletehttp://www.caseyresearch.com/cwc/economic-crisis-part-i-video-interview-bud-conrad
Gary,
Sorry, my mistake. I need a cup or two of coffee.
Folks I suggest that you do not let your mining positions turn into a loss.
ReplyDeleteTake a step back and look what has happened in the last two days. Gold has barely even moved yet the miners have corrected 7% and are threatening to move back below the 200 day moving average.
Don't fool yourself into thinking that the miners are going to bounce off of support levels. The miners are not going to stop dropping until gold finds a bottom. We're not even sure if gold has found the top yet.
At this rate if gold drops back down to tag the breakout level at 1578 the mining stocks could make new lows. There's no reason to ride that kind of a draw down.
Take your profits in mining stocks and look to buy when we get a sign that gold has finished its daily cycle correction.
SB,
ReplyDeleteMay get a little tiny follow up bounce off the 10sma tomorrow, and possibly monday, then cracked over the head on debt ceiling crap monday night into tuesday.